Unlocking the Potential of Cumulative and Non-Cumulative Fixed Deposits

Fixed Deposits

When it comes to investing your money, there are a plethora of investment avenues available. Investors, particularly those who are risk-averse, tend to seek options that provide guaranteed returns with minimum risks involved. This is where fixed deposits (FDs) come in.

FDs have been a popular investment option for decades, thanks to their stability, guaranteed returns, and safety. However, to make the most of FDs, you need to understand the two types: cumulative and non-cumulative fixed deposits.

In this article, we will take a deeper dive into what cumulative and non-cumulative fixed deposits are, where to invest in them, and the available apps that make investing in these FDs are easier and more convenient. We will also take a closer look at FD interest rates for senior citizens and how they can benefit from fixed deposits.

What are Fixed Deposits?

Fixed deposits are a safe, low-risk investment instrument offered by banks and other financial institutions in which you deposit a sum of money for a fixed period of time (known as tenure) to earn a fixed interest rate. At the end of the tenure, you get back your initial investment along with the interest earned.

These deposits are ideal for those who want to invest their money for a certain period of time and earn a fixed return. FDs are also known for their low risks, and they are secured by the Deposit Insurance and Credit Guarantee Corporation (DICGC).

What is Cumulative Fixed Deposits?

Cumulative fixed deposits are those in which the interest on the deposit gets added up to the principal. As a result, the interest gets compounded for the full tenure, and the maturity amount will be higher than the interest payable on non-cumulative or simple fixed deposits.

The compounding frequency can differ depending on the FD scheme you choose; it could be monthly, quarterly, half-yearly, or annually. You can choose the frequency that suits your needs best.

Cumulative FDs are suitable for investors who prefer to earn a lump sum at maturity. Since in these types of deposits, interest is paid out at the end of the tenure, they help to accumulate a considerable corpus over a more extended period.

What are Non-Cumulative Fixed Deposits?

Non-cumulative fixed deposits are those in which you receive interest payouts at regular intervals. The frequency for payout could be monthly, quarterly, half-yearly, or annually – based on the scheme you chose. The interest earned on these deposits is not compounded and, therefore, remains fixed throughout the tenure.

Non-cumulative deposits are a great option if you are looking for regular income flows. Such deposits provide a fixed income stream that can be used to meet regular expenses. Elderly citizens who have retired and want to secure a regular income can also benefit from non-cumulative fixed deposits.

How to Invest in Fixed Deposits?

With the advent of technology, investing in fixed deposits has become more convenient than ever. Now, you can open an FD account online or use an FD app. Here are some options available to you:

Bajaj Finserv App

The Bajaj Finserv App is a reliable name in the field of finance, and they have a simple app that allows you to open and manage your FD account easily. The Bajaj Finserv App will guide you through the entire process of opening an FD account, choosing the right scheme and fixed deposit interest rates, and finally depositing the amount.

In December 2023, prevailing fixed deposit rates within the industry typically range between 5-6% p.a. for the general customer base, with an additional 0.75% interest for senior citizens. In contrast, Bajaj Finserv Digital FD stands out by offering an impressive interest rate of 8.85% p.a. (only for digital fixed deposits.) This substantial lead positions Bajaj Finserv ahead of its competitors in the market. Notably, Bajaj Finance, the parent company, holds a triple-A rating as a Non-Banking Financial Company (NBFC). This robust financial standing contributes to the offering of an attractive interest rate, further reinforcing the appeal of Bajaj Finserv Digital FD.


ICICI Bank is one of the leading private banks in India. They have an easy-to-use website and app that is ideal for people looking to invest in fixed deposits online. The ICICI Bank app gives you all the information about fixed deposit investments, interest rates, and maturity period options.


HDFC Bank offers various fixed deposit schemes with different tenures and interest rates. You can open an FD account with them online by visiting their website or using the HDFC Bank mobile app.

FD Interest Rates for Senior Citizens

Senior citizens are a valuable demographic for financial institutions. They are frequently offered exclusive FD plans by banks, NBFCs, and fintech companies. These plans often have higher interest rates with several additional benefits such as flexible tenure options, preferential interest rates, and no TDS (Tax Deduction at Source) on interest earned on certain FDs.

It is, however, important to note that senior citizens can only avail of these benefits if they meet the age criteria set by the financial institution. Generally, the age criterion for receiving senior citizen benefits is 60 years or above.

Unlocking the Full Potential of Cumulative and Non-Cumulative Fixed Deposits

Based on your investment goals, you can invest in either a cumulative or non-cumulative fixed deposit. Cumulative deposits are ideal for growing your corpus over a more extended period, while non-cumulative deposits offer regular income flows.

When selecting an FD scheme, it is essential to consider several factors such as tenure, deposit amount, and the interest rates offered by the concerned bank or institution. With an investment app like Bajaj Finserv, you can get all the necessary information and assistance you need to make an informed investment decision.


In conclusion, fixed deposits are a great low-risk investment option that provides guaranteed returns. Cumulative and non-cumulative FDs have their respective benefits, and it is essential to choose one based on your financial goal.

Several financial institutions now offer online FD accounts and have easy-to-use mobile apps, allowing investors to manage their investments and monitor their deposits conveniently from their mobile devices.Seniors looking for a low-risk investment option with regular income flows can opt for senior citizens’ special FD plans, which offer exclusive benefits.So, take advantage of this safe and proven investment option and let your funds grow securely with cumulative and non-cumulative fixed deposits.



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