Flexi fixed deposit: Key features, benefits, and differences from regular FDs

Flexi fixed deposit: Key features, benefits, and differences from regular FDs

06 February 2024 | By INDIE

What is a flexi FD? This question is a frequently asked one, especially among those looking for new investment alternatives. Also called a flexible deposit account, a flexi fixed deposit (FD) is a new financial product that blends the benefits of an FD and savings bank account. It is a hybrid product, providing the security of an FD while maintaining the flexibility offered by a savings account. Let's look at this account’s features, advantages, and distinctions from the traditional FDs.

Key features of flexi deposits

Dual benefits

You are not just making a set fixed deposit. A flexi deposit also contains a connected savings bank account for frequent transactions, offering a complete financial solution.

Automated management of finances

Excess funds in your savings bank account are automatically transferred to your FD, ensuring that your money is always working for you without the stress of manual transfers.

Fixed income with flexible savings

A flexi fixed deposit blends the convenience of a savings account with the security and consistency of a fixed deposit.

Partially withdraw funds

Unlike regular fixed deposits, you can withdraw a portion of your deposit without having to break the entire amount, permitting you to keep up with your long-term savings goals.

Earnings with liquidity

Flexi deposits are ideal for unexpected needs. You can get hold of your stored cash whenever you require, without forfeiting your returns.

Daily or monthly interest

Depending on the bank's policy, the interest on a flexi deposit may be calculated daily or monthly. This means that the more you save and the longer you save, the more interest you earn.

Advantages of flexi fixed deposits

You can invest an amount of your choice

Flexi deposits allow you to invest a sum that corresponds with your financial objectives and circumstances.

This deposit helps with increasing your earnings

Flexi fixed deposit interest rates are usually higher as compared to the rates offered by conventional savings bank accounts, helping your funds grow more effectively.

You can rely on the deposit’s liquidity

Recognising the uncertainty of life, your bank may permit a premature withdrawal for your flexi deposit.

Flexi deposits offer personalised investment time frames

The investment duration of your flexi deposit can be flexible, depending on your bank’s terms. Based on your financial goals, you can pick a short-term or long-term tenure for your flexi deposit investment.

Opening an account is a simple process

The flexi deposit account opening process, like the online FD opening process, is a simple one with minimum documentation required.

You can access the auto-renewal option

Many flexi deposits provide an auto-renewal option to make managing the investment easier, eliminating the need to track maturity dates.

You can avail a loan against your flexi deposit

You can also exercise the option of borrowing against your flexi deposit. This way, you can arrange for the funds without having to prematurely withdraw funds from your deposit.

Differentiating flexi FDs from normal FDs

Build-up of interest

Flexi FDs can offer daily or monthly interest computations, potentially resulting in larger returns than the standard FDs' interest calculation.


Standard FDs frequently demand breaking the full deposit to have access to cash, however, flexi FDs allow partial withdrawals.

Flexibility with investment amounts

Unlike traditional FDs which often have a predetermined minimum deposit requirement, flexi FDs allow you to choose the amount of your investment.

Automatic transfer of funds

Excess funds in savings account are immediately moved to the flexi FDs, which is not available in regular FDs.[KT1]

Choosing the right FD for you

Both flexi FDs and conventional FDs have distinct advantages. A flexi FD is an excellent alternative if you desire high returns as well as periodic liquidity. It is ideal for people who want a dynamic approach to saving, in which your funds can earn high interest and be available for immediate use. On the other hand, a traditional FD offering a fixed interest rate can be better suited for the long term. Regular FDs are a sound alternative for people who want to store money for a long time without having to access it. Finally, choose between these two types based on your financial goals and liquidity needs. You can consider INDIE by IndusInd Bank if you are looking to open a fixed deposit to enjoy market-leading interest rates of up to 7.75% per annum. INDIE fixed deposits offer flexible payout options, and you can even start with a minimum deposit of Rs. 1,000!

Disclaimer: The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.