Is term deposit and fixed deposit same ?

 I came across a query several times: is term deposit same as fixed deposit? The term deposit and fixed deposit are closely related concepts, but are not always the same. While both term deposits and fixed deposits share several features, namely a fixed tenure, fixed rate of interest, maturity date, and penalty for premature withdrawal, there are subtle differences.

• A term deposit is a broader category of deposits where you lock in a sum of money for a fixed period at a predetermined interest rate. Fixed Deposits (FDs) are one popular type of term deposit.

• The term deposits may also include Recurring Deposits (RDs), certain Post Office deposit schemes, foreign-currency deposits, senior-citizen term deposits, etc. These products broaden the idea beyond just “one lump sum invested for a fixed time.”

• Fixed Deposits are more specific. You deposit a lump sum amount, the interest rate is fixed for the entire duration, and at the end of the tenure, you receive accumulated interest (or interest as per payout options).

• Term deposits include more flexibility in the type of product, and fixed deposits are one of those. 

• Term deposits may have varying interest rate structures or may involve more flexible versions, while fixed deposits tend to have stricter locking and often better rates (depending on tenure and bank).

I hope you understood their differences.

In India, the terms "Term Deposit" and "Fixed Deposit" are often used interchangeably, but they generally refer to the same type of financial product with a few nuanced distinctions based on context. Let me share some insights to answer your question: is term deposit and fixed deposit same.

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Is Term Deposit Same as Fixed Deposit?

Here’s a detailed explanation:

Both types offer secure investment options with fixed returns but differ in terms of deposit frequency and flexibility. Your query for is term deposit and fixed deposit same should be solved.

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When I was trying to decide which deposit to choose. I went to a bank and spoke to the manager. I was left more confused about term deposit vs fixed deposit. Let me tell you about the options and if they have any advantages and disadvantages. You need to think of your financial goals before choosing one. 

Is term deposit and fixed deposit same?

From my understanding, term deposit and fixed deposit are the same. Mostly, bankers tend to use the word ‘deposit’. It is a stable and safe return on their investments. Term deposits and fixed deposits are kept for a fixed maturity where the depositor is not allowed to withdraw until the end of the maturity period. 

Since there is no big difference between term deposit and fixed deposit. Let me share another investment option for customers i.e. Recurring Deposit. In case, you want to make a premature withdrawal you will end up paying an added penalty for breaking the withdrawal rule. 

Many banks allow people to convert their Recurring Deposits to Fixed deposits. For the most part, fixed deposits are kept for a longer period than other types. You can take the funds in the form of Term Deposits, Savings Accounts and Current Accounts. 

That is all from my end on term deposit vs fixed deposit.