With interest rates on the rise for more than a year, fixed deposits (FDs) which have traditionally been a ‘boring’ investment choice, have risen in popularity. It’s no surprise then, that many online investment platforms have been offering FDs from varied banks and NBFCs to their customers.
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Stable Money, an online investment platform, which was co-founded by Saurabh Jain and Harish Reddy in late 2022, debuted last month by offering FDs to its customers. Currently, they offer FDs from five entities including Axis Bank, Utkarsh Small Finance Bank and Bajaj Finance.
Their aim is to add 15-20 banks by next year and also offer corporate bonds, sovereign gold bonds and other fixed return products. This week, they launched new features such as FD laddering and FD switch for their customers.
Moneycontrol spoke to Jain about Stable Money’s FD-first approach, how one can invest on their platform and whether it is safe to do so, and more.
Here are a few important points that he highlighted:
1. Attracting money into FDs - while FDs may not grow at the same pace as stocks and mutual funds, given their sheer volume (32 percent of household savings are in FDs and similar assets), even 8-9 percent growth per year will be a decent growth. FDs will also benefit from growing digitization – last year, one out of every four FDs was done digitally. Customer segment-wise, Jain says they have seen that in the metros, those 25 years and above, do like to start parking some money in safe assets such as FDs. On the other hand, those in Tier-I and Tier-II cities, start investing in FDs even from a younger age.
2. Investing via Stable Money – One can compare and search for FDs that one is interested in. To begin investing, one has to do a simple KYC (know your customer) process which can be done completely online. “We have seen that when someone comes to book an FD next time, they are able to do this in 30 seconds,” says Jain.
3. Is it a safe platform for investments – Jain says that whenever one makes an investment on Stable Money, the money goes directly to the bank / NBFC concerned and not to them. Similarly, when an FD matures or the customer makes a premature withdrawal, the money goes directly to the customer’s bank account. At no point in time, the money comes to Stable Money.
4. On comparison with online bond platform providers (OBPPs) – Jain says Stable Money, too plans to start offering bonds in another 3-6 months. Jain said that they have applied for all the required licences for this.
5. Recent launch of new features – FD Laddering - which will enable Stable Money’s customers to spread their corpus across FDs of different tenures (say, 1, 2 and 3 years) by picking the highest-return FDs across different banks and NBFCs, all on the same platform. FD Switch - Stable Money has created a calculator which can help its customers evaluate the net gain or loss from breaking an FD (resulting in a penalty charge) and re-investing that money in another FD (where the interest rate is higher).
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