A Mutual Fund is a body corporate that pools the savings of a number of investors and invests the same in a variety of different financial instruments, or securities. The income earned through these investments and the capital appreciation realised by the scheme are shared by its unit holders in proportion to the number of units owned by them. Mutual funds can thus be considered as financial intermediaries in the investment business who collect funds from the public and invest on behalf of the investors. The losses and gains accrue to the investors only. The Investment objectives outlined by a Mutual Fund in its prospectus are binding on the Mutual Fund scheme. The investment objectives specify the class of securities a Mutual Fund can invest in. Mutual Funds invest in various asset classes like equity, bonds, debentures, commercial paper and government securities.

An Asset Management Company (AMC) is a highly regulated organization that pools money from investors and invests the same in a portfolio. They charge a small management fee, which is normally 1.5 per cent of the total funds managed.

NAV or Net Asset Value of the fund is the cumulative market value of the assets of the fund net of its liabilities. NAV per unit is simply the net value of assets divided by the number of units outstanding. Buying and selling into funds is done on the basis of NAV-related prices. NAV is calculated as follows:

NAV =     Market value of the funds investments + Receivables +Accrued Income- Liabilities-Accrued Expenses        _______________________________________________________________________________                                             Number of Outstanding units 

The NAV of a scheme has to be declared at least once a week. However many Mutual Fund declare NAV for their schemes on a daily basis. As per SEBI Regulations, the NAV of a scheme shall be calculated and published at least in two daily newspapers at intervals not exceeding one week. However, NAV of a close-ended scheme targeted to a specific segment or any monthly income schemes (which are not mandatorily required to be listed on a stock exchange) may be published at monthly or quarterly intervals.

1. Qualified and experienced professionals manage Mutual Funds. Generally, investors, by themselves, may have reasonable capability, but to assess a financial instrument a professional analytical approach is required in addition to access to research and information and time and methodology to make sound investment decisions and keep monitoring them.

2. Since Mutual Funds make investments in a number of stocks, the resultant diversification reduces risk. They provide the small investors with an opportunity to invest in a larger basket of securities.

3. The investor is spared the time and effort of tracking investments, collecting income, etc. from various issuers, etc.

4. It is possible to invest in small amounts as and when the investor has surplus funds to invest.

5. Mutual Funds are registered with SEBI. SEBI monitors the activities of Mutual Funds.

6. In case of open-ended funds, the investment is very liquid as it can be redeemed at any time with the fund unlike direct investment in stocks/bonds.

Mutual Funds do not provide assured returns. Their returns are linked to their performance. They invest in shares, debentures and deposits. All these investments involve an element of risk. The unit value may vary depending upon the performance of the company and companies may default in payment of interest/principal on their debentures/bonds/deposits. Besides this, the government may come up with new regulation which may affect a particular industry or class of industries. All these factors influence the performance of Mutual Funds.

(a) On the basis of Objective Equity Funds/ Growth Funds Funds that invest in equity shares are called equity funds. They carry the principal objective of capital appreciation of the investment over the medium to long-term. The returns in such funds are volatile since they are directly linked to the stock markets. They are best suited for investors who are seeking capital appreciation. There are different types of equity funds such as Diversified funds, Sector specific funds and Index based funds.

These funds invest in companies spread across sectors. These funds are generally meant for risk-taking investors who are not bullish about any particular sector.

These funds invest primarily in equity shares of companies in a particular business sector or industry. These funds are targeted at investors who are extremely bullish about a particular sector.

These funds invest in the same pattern as popular market indices like S&P 500 and BSE Index. The value of the index fund varies in proportion to the benchmark index.

These funds offer tax benefits to investors under the Income Tax Act. Opportunities provided under this scheme are in the form of tax rebates U/s 88 as well saving in Capital Gains U/s 54EA and 54EB. They are best suited for investors seeking tax concessions.

These Funds invest predominantly in high-rated fixed-income-bearing instruments like bonds, debentures, government securities, commercial paper and other money market instruments. They are best suited for the medium to long-term investors who are averse to risk and seek capital preservation. They provide regular income and safety to the investor.

These funds invest in highly liquid money market instruments. The period of investment could be as short as a day. They provide easy liquidity. They have emerged as an alternative for savings and short-term fixed deposit accounts with comparatively higher returns. These funds are ideal for Corporate, institutional investors and business houses who invest their funds for very short periods.

These funds invest in Central and State Government securities. Since they are Government backed bonds they give a secured return and also ensure safety of the principal amount. They are best suited for the medium to long-term investors who are averse to risk.

These funds invest both in equity shares and fixed-income-bearing instruments (debt) in some proportion. They provide a steady return and reduce the volatility of the fund while providing some upside for capital appreciation. They are ideal for medium- to long-term investors willing to take moderate risks.

These funds adopt highly speculative trading strategies. They hedge risks in order to increase the value of the portfolio.

(b) On the basis of Flexibility

These funds do not have a fixed date of redemption. Generally they are open for subscription and redemption throughout the year. Their prices are linked to the daily net asset value (NAV). From the investors perspective, they are much more liquid than closed-ended funds. Investors are permitted to join or withdraw from the fund after an initial lock-in period.

These funds are open initially for entry during the New Fund Offer (NFO) and thereafter closed for entry as well as exit. These funds have a fixed date of redemption. One of the characteristics of the close-ended schemes is that they are generally traded at a discount to NAV; but the discount narrows as maturity nears. These funds are open for subscription only once and can be redeemed only on the fixed date of redemption. The units of these funds are listed (with certain exceptions), are tradable and the subscribers to the fund would be able to exit from the fund at any time through the secondary market.

These funds combine the features of both open-ended and close-ended funds wherein the fund is close-ended for the first couple of years and open-ended thereafter. Some funds allow fresh subscriptions and redemption at fixed times every year (say every six months) in order to reduce the administrative aspects of daily entry or exit, yet providing reasonable liquidity.

A growth plan is a plan under a scheme wherein the returns from investments are reinvested and very few income distributions, if any, are made. The investor thus only realises capital appreciation on the investment. This plan appeals to investors in the high income bracket. Under the dividend plan, income is distributed from time to time. This plan is ideal to those investors requiring regular income.

Dividend plans of schemes carry an additional option for reinvestment of income distribution. This is referred to as the dividend reinvestment plan. Under this plan, dividends declared by a fund are reinvested on behalf of the investor, thus increasing the number of units held by the investors.

Under Systematic Investment Plan (SIP), the investor is given the option for investing in a specified frequency of months in a specified scheme of the Mutual Fund for a constant sum of investment. AIP allows the investors to plan their savings through a structured regular monthly savings program.

Under Systematic Withdrawal Plan (SWP), a facility is provided to the investor to withdraw a pre-determined amount from his fund at a pre-determined interval.

The non refundable fee paid to the Asset Management Company at the time of redemption/ transfer of units between schemes of mutual funds is termed as exit load. It is deducted from the NAV (selling price) at the time of such redemption/ transfer.

Redemption price is the price received on selling units of open-ended scheme. If the fund does not levy an exit load, the redemption price will be same as the NAV. The redemption price will be lower than the NAV in case the fund levies an exit load.

Repurchase price is the price at which a close-ended scheme repurchases its units. Repurchase can either be at NAV or can have an exit load.

Some Mutual Funds provide the investor with an option to shift his investment from one scheme to another within that fund. For this option the fund may levy a switching fee. Switching allows the Investor to alter the allocation of their investment among the schemes in order to meet their changed investment needs, risk profiles or changing circumstances during their lifetime.

After the closure of the Initial Offer Period, on an ongoing basis, the Trustee reserves a right to declare Shut-Out period not exceeding 5 days at the end of each month/quarter/half-year, as the case may be, for the investors opting for payment of dividend under the respective Dividends Plans. The declaration of the Shut-Out period is envisaged to facilitate the AMC/the Registrar to determine the Units of the unitholders eligible for receipt of dividend under the various Dividend Options. Further, the Shut-Out period will also help in expeditious processing and despatch of dividend warrants. During the Shut-Out period investors may make purchases into the Scheme but the Purchase Price for subscription of units will be calculated using the NAV as at the end of the first Business Day in the following month/quarter/half-year as the case may be, depending on the Dividend Plan chosen by the investor. Therefore, if investments are made during the Shut -Out period, Units to the credit of the Unitholders account will be created only on the first Business Day of the following month/ quarter/half year, as the case may be, depending on the dividend plan chosen by the investor. The Shut-Out period applies to new investors in the Scheme as well as to Unit holders making additional purchases of Units into an existing folio. The Trustee reserves the right to change the Shut-Out period and prescribe new Shut- Out period, from time to time.

There is no lock-in period in the case of open-ended funds. However in the case of tax saving funds a minimum lock-in period is applicable. The lock-in period for different tax saving schemes are as follows:

Unit Trust of India was the first mutual fund which began operations in 1964. Other issuers of Mutual funds are Public sector banks like SBI, Canara Bank, Bank of India, Institutions like IDBI, ICICI, GIC, LIC, Foreign Institutions like Alliance, Morgan Stanley, Templeton and Private financial companies like Kothari Pioneer, DSP Merrill Lynch, Sundaram, Kotak Mahindra, Cholamandalam etc.

Choice of any scheme would depend to a large extent on the investor preferences. For an investor willing to undertake risks, equity funds would be the most suitable as they offer the maximum returns. Debt funds are suited for those investors who prefer regular income and safety. Gilt funds are best suited for the medium to long-term investors who are averse to risk. Balanced funds are ideal for medium- to long-term investors willing to take moderate risks. Liquid funds are ideal for Corporates, institutional investors and business houses who invest their funds for very short periods. Tax Saving Funds are ideal for those investors who want to avail tax benefits. An important aspect while selecting a particular scheme is the duration of the investment. Depending on your time horizon you can select a particular scheme. Besides all this, factors like promoters image, objective of the fund and returns given by the funds on different schemes should also be taken into account while selecting a particular scheme.

Choice of any scheme would depend to a large extent on the investor preferences. For an investor willing to undertake risks, equity funds would be the most suitable as they offer the maximum returns. Debt funds are suited for those investors who prefer regular income and safety. Gilt funds are best suited for the medium to long-term investors who are averse to risk. Balanced funds are ideal for medium- to long-term investors willing to take moderate risks. Liquid funds are ideal for Corporates, institutional investors and business houses who invest their funds for very short periods. Tax Saving Funds are ideal for those investors who want to avail tax benefits. An important aspect while selecting a particular scheme is the duration of the investment. Depending on your time horizon you can select a particular scheme. Besides all this, factors like promoters image, objective of the fund and returns given by the funds on different schemes should also be taken into account while selecting a particular scheme.

Yes, the fixed deposit interest is compounded based on monthly, quarterly, half-yearly or yearly interest rates. Individuals can utilize the fd interest rate calculator to determine the approximate interest they will be earning on their investment (principal amount) or FD account. Considering the fact that the FD has fixed terms, the interest compounding becomes rather simple with the interest payment frequency as one of the prime variable components.

Fixed deposit accounts can be opened under a cumulative or non-cumulative deposit scheme. Based on the type of the deposit scheme, the account will earn interest on the investment (principal amount) on either monthly, quarterly or annual basis. The account holder will have the option to choose the fixed deposit term ranging from few months to a maximum of 10 years. At maturity of a cumulative fixed deposit account, the account holder can choose to reinvest the interest along with the principal amount for an extended period of time.

Yes, the account holder can choose to receive the interest payment every month for the entire term of the fixed deposit account. Depending on the investment (deposit amount), term, and interest rate offered by the account, the monthly interest amount can be calculated. Most banks offer the fixed deposit interest calculators on their website that will come handy when you need to calculate the earnings and value of the investment

A fixed deposit online calculator will help you calculate the interest that your money will earn when kept in a fixed deposit. This will take into account your investment that's the Principal amount on maturity after the interest is compounded on a monthly, quarterly, half-yearly or yearly basis. As an example let’s say that you have a sum of Rs.15, 000 that is deposited in your bank for a period 2 years the interest the bank is paying you is an annual interest rate of 5%, The interest will be compounded quarterly for this period.

Maturity Value (A) = P x (1 + r/n)nt
= 15000 x (1 + 0.05/4)4x2
= 15000 x (1 + 0.0125)8
= 15000 x (1.0125)8
= 15000 x 1.104486101
Making the Maturity Value (A) = Rs. 16567.29.
And hence leading to the Maturity Value (FD) = Rs. 16567.29
Interest Earned Amount (I) = Rs. 1567.29.

No. Only tax saver FDs give you a tax benefit.

Life insurance is protection against financial loss resulting from insured Individual’s death. In realistic terms, life insurance provides you and your family the financial security and certainty to deal with the aftermath of any unseen unfortunate events.

Life Insurance provides you and your family with protection against all the risks involved, moreover providing you an opportunity to grow your investments. It could be viewed as a long-term investment to provide for your child’s future expenses or your expenses, post retirement.

You need insurance for Family that is financially dependent on you: If you have a family that is financially dependent on you, then you definitely need to insure yourself. The most common reason to buy life insurance is it provide protection to your family incase of any unforeseen events. The life insurance proceeds can be used to support your family members with the expenses.
Loans or liabilities: It is very important to insure yourself if you have taken a loan or mortgaged your assets. It not only provides peace of mind but also a steady source of income for your family.
Compulsory saving-cum-investment: A life insurance policy could be used as a compulsory saving-cum-investment avenue. Proceeds from the insurance policy could be used to fund future expenses such as child’s higher education or retirement funds or even a well-deserved holiday.
Partner in a firm or Self-employed: It is highly needed by people who are partners in a firm or have their own proprietor firms. Life insurance can be a critical component for specialized business applications - such as funding a buy-sell agreement. The proceeds of a life insurance policy could be used to provide cash for the purchase of a deceased owner’s interest in the business or to pay off business liabilities.
Other than the RBI Bonds, insurance products are the only other investment products that guarantee yields over a range of time - from 5 years to 25 years. Insurance companies offer single premium investment products as well as regular investment-cum-insurance products that guarantee high yields over a period.

Breadwinner - If you are the breadwinner of the family, you should insure yourself first.
Working spouse - If you have a working spouse who could use an insurance policy, both of you could insure yourselves in a joint-life policy. It could serve as a low-cost policy which covers both of you, and which either of you could use for tax-saving purposes as well.
Children - If you have children you could buy an insurance policy in their name. This would ensure that your children receive a certain sum of money in their needy years of higher education. The major advantage in such a policy is that your child or family receives a guaranteed amount of money at a specified period in life.
This type of a policy helps since the earning parent may not be alive later when the child needs money for higher education and the spouse may not be in a position to provide such a large sum of money. Moreover, a policy of this kind ensures a compulsory saving for the child’s future.
Partner/Key-person in the organization: If you have a working partner in your firm or a key-person(s) in the organization, your firm/organization could buy life insurance for them. Such a policy would insure your firm against any financial loss that would be incurred in the event of your partner/key-person’s death.

The minute you have people dependent on your income, you should insure yourself. The younger the age, the lower is your premium. We believe anybody who is married and has children or plans to have children needs to be insured. Even if you are single, earning and intending to marry, you should think of buying a policy now, as it costs less now than it will when you marry. Remember, it is never too late to buy an insurance policy. Even if you are 45, and are not insured, you could choose insurance products that provide benefits to your family and provide income during your retirement period.

Ideally, you should insure yourself for as long as you are the critical or crucial breadwinning member of the family. With the growing nuclear families and the typical Indian sacrificing mothers/wives. It may be prudent to ensure that the working man covers himself for his whole life; to ensure that his wife receives a lump sum upon his death.

The two basic elements to all individuals are Risk coverage (i.e. Term Insurance) Savings for future (i.e. Pure Endowment)

The cost of buying an insurance policy depends on:

• Your age, health and the nature of work you do
• Policy type selected.
• Sum assured.
• Policy term.
• Premium paying term.
• Premium payment frequency.
• Riders (if any) attached to the policy.

The cost of a policy could be lowered if you:

• Buy insurance at an early age (while the risk is lower).
• Insure yourself for a long period.
• Insure yourself for a large sum assured; offer to pay premium annually, thereby receiving discounts.
• Select a low cost policy such as a Term product, which offers negligible to minimum returns upon maturity. Do not buy riders or additional benefits that do not seem to add value to you or are available as other insurance policies at lower prices.

The insurance sector is classified into Life and Non-life (or General insurance as we know it). Under Life insurance, an individual’s life is covered i.e., the insured’s nominee receives a certain sum of money if the insured individual dies within a specified time.

To ensure you are safe, the least you should do is to ensure that you have - Health insurance - Life insurance, Accident Insurance

You could use some of the insurance policies as investment products. Insurance companies now offer a variety of products that allow the insured to choose his investment option. There are policies that offer a fixed guaranteed rate of return; some offer a market-linked rate while some allow the insured to select his investment option. In the current state of the market, yields from insurance products can be expected to vary in the range of 6.5 -7.5 - 8% per annum (pre tax).

Life insurance usually without medical examination, on a group of people under a master policy. It is typically issued to an employer for the benefit of employees or to members of an association, for example a professional membership group. The individual members of the group hold certificates as evidence of their insurance.

The type of policy that suits you best depends on many factors, such as your insurance objectives, your income, assets, liabilities, number of dependent members in your family and family expense. Life insurance policies are broadly classified in to three categories.

• Endowment Policies
• Money back policies
• Child Plans
• Unit Linked Policies
• Whole Life Policies
• Pension Policies

Term Insurance covers “Risk” and Risk means “Death”. Here a lump sum amount is payable only if death occurs during a selected period. If the insured survives till the end of the selected period, nothing becomes payable.

Term Insurance covers “Risk” and Risk means “Death”. Here a lump sum amount is payable only if death occurs during a selected period. If the insured survives till the end of the selected period, nothing becomes payable.

The insurer will receive a lump sum amount either at death during the term or at maturity of the term.

Whole life insurance risk covers the death of the insured, whenever it may happen. It means that there is no fixed term under whole life insurance. Most policies provide a dividend to the policy holder which helps with retirement. There are two variations in the whole life insurance products i.e.
Pure Whole Life Insurance: - where premiums are payable continuously throughout the life of the insured till death. Risk coverage is for the entire duration of life and the life insured amount is paid on the happening of the death of the insured at any time. Limited Payment Whole life Insurance: - where premiums are paid for a limited and shorter period and the option of the insured or till death if earlier. Risk coverage is however throughout the life of the insured.

Unlike endowment plans, in money back policies, the policy holder gets “periodic payments" during the term of the policy and a lump sum amount on surviving its term. In the event of death during the term of the policy, the beneficiary gets the full sum assured, without any deductions for the amounts paid till date, and no further premiums are required to be paid. These type of policies are very popular, since they can be tailored to get large amounts at specific periods as per the needs of the policy holder.

There is no particular right time for making your home loan application. As soon as you have figured out your budget and zeroed down on the property that you want to buy, you should apply for home finance.

Yes, mostly. Although a lot of loan processing work has been shifted to online platforms, still a loan applicant is required to visit the lending bank branch at least once to formally close the loan processing formalities. Many private banks have started sending their representatives to borrowers’ place to get documents and forms signed and verified.

No. Generally, banks only lend 80% of the cost of your property. The rest 20% is to be borne by the loan borrower. However, to ease out the process for customers, most banks have broken up this ration into 10-80-10 so that at the time of availing the loan, customers are only required to pay 10% of the total cost and the rest is paid by the bank.

Repayment of loan starts after the entire home loan is disbursed to the borrower. In case of under-construction properties banks allow payment of the partially disbursed amount. Towards this partially disbursed loan amount, customers are free to either repay the principal and interest amount both or just the interest amount or none at all.

Yes. All banks allow pre-payment of home loans. Some banks charge a pre-payment fee for that while others do not.

Current home loan borrowers who have a running home loan account can choose to continue with base rate or switch to MCLR. New home loan borrowers need to avail the new MCLR rates which are subject to change every set interval of time as mandated by the RBI.

Your home loan will get sanctioned as soon as all the required documents are submitted and verified successfully. This may take anywhere between 10 to 30 days.

Yes. Home loans are a great instrument to avail tax benefit. This is offered to both the interest and principal components of home finance. Under section 24(1) interest repayment of Rs.1,50,000 is eligible for exemption and on the same housing loan a principal amount of Rs.1,00,000 is eligible for exemption from tax.

Any kind of property is considered an asset and hence buying a property is considered as a wise decision. Also, real estate prices have been appreciating on an annual basis. If you are confident that your income is sufficient to cover you for a long term liability like home loan then you can surely avail one to buy a property.

EMI stands for Equated Monthly Installments. An EMI is made up of two components, principal and interest. Any loan availed by a borrower is repaid in EMIs over the loan tenure.

Since home loan is a huge loan amount and the tenure also is long, hence, almost all banks ask borrowers to furnish some collateral as security against the loan. This include the papers of property for which loan is being sought, some other property papers, any fixed deposit schemes or insurance schemes etc. that are on the loan borrower’s name.

Yes. You can apply jointly in your and your spouse’s name. Both of your incomes will be considered for determination of loan quantum.

Generally, all banks ask for proof of address, proof of identity, bank account statements and salary details from home loan borrowers. This list may differ a bit from one bank to another.

Home loan EMI payments can be made to the bank either by using offline channels like cheque, demand draft and cash or by availing the net banking facility that all banks offer to their home loan customers. Post dated cheques and Standing Instructions are another popular way to make EMI payments.

Any property document that you submit as security collateral is returned to you only once the entire home loan amount is repaid and the home loan on your name is closed.

Yes. Home loans are offered under various sub-heads. Housing finance for renovation of property or construction of house is also offered by all major banks in the country.

Yes. Most banks allow switching between fixed and floating rates. However, customers may be charged a particular fee for the same.

A. Personal loan is an unsecured loan that is given without any security. The end use of the money is not monitored either.

You can take a personal loan to meet any personal financial requirement or to repay your credit card bill, to buy electronic items, to take a vacation or to even meet the expenses of a wedding or any other function.

 A salaried individual, self-employed professionals and self-employed non-professionals can apply for a personal loan.

Most banks will provide personal loan for a minimum of 1 year.

Most banks will provide personal loan for a maximum of 5 years.

The minimum age of the applicant must be not less than 21 years and the maximum age of the applicant at loan maturity must be 65 years.

Yes, usually the banks charge a processing fee of 2-3 percent on the loan amount. You can however negotiate with the bank to reduce the fee

Personal loan can be repaid in equal monthly instalments or EMI. You can provide a post-dated cheque or can give a standing order with your bank or through electronic transfer. 

EMI or Equal Monthly Instalment includes principal and interest.

 Personal loans can be prepaid in parts or fully at any stage. Some banks might charge a prepayment penalty whereas some banks will not. Some banks will not allow the part-prepayment. So, check all the documents before finalising with the bank.

No, you will not need a guarantor to take a personal loan.

Yes, you can club the income of your spouse to boost your eligibility to avail a personal loan.

The banks do not usually let you take a loan exceeding 30- 40 percent of your net salary.

Generally, the minimum amount limit that one can take a personal loan is Rs.1,000.

Generally, the maximum loan limit is Rs.15 lakhs.

 No, you don’t have to provide any security or collateral to take a personal loan.

Yes, you have the option to choose either the fixed or floating rate of interest.

The interest rate varies from banks to banks and it is within 14-26 percent depending on your profile and the scheme that you opt for.

Banks disburse the loan within 72 hours to 7 working days provided all the documents are in place.

Yes, banks refer your CIBIL score and credit report and the minimum CIBIL score requirement is 750+.

Yes, the CIBIL score affects the interest rate offered to you. If your CIBIL score is high and if you have a good repayment history, then the bank will offer you a lower interest rate.

 If you have been a customer for a particular bank for a while, then the bank might reduce the personal loan interest rate or other such charges. Some banks will also provide you additional services.

You need to submit an identity proof as well as residence proof, your latest salary slip, form no. 16, last 6 months bank statement and a passport sized photograph that is to be affixed on the application form.

 If you don’t have a bank account with the bank, it is not mandatory to apply for one. But, if you apply for a loan with your existing banker, then you will be eligible for a relationship discount.

Some banks let you register yourself for ‘Do Not Disturb’. The executives will not disturb you with cold sales calls.

The best way to apply for an personal loan is by using the online loan application tool at BankBazaar.com The tool can be accessed on this page allowing users to choose personal loan from various banks and NBFCS as per their selection.

Various banks and NBFC’s offer personal loans ranging from a minimum amount of Rs. 1000 to a maximum amount of Rs. 15 to Rs. 20 Lakhs. The maximum and minimum loan amount depends on the underlying bank as well as the personal financial details of the loan seeker.

Various banks offer different tenure for personal loans. The most common tenure period offered by majority of banks and NBFCs ranges between 12 to 60 months.

You can take a personal loan to meet any personal financial requirement or to repay your credit card bill, to buy electronic items, to take a vacation or to even meet the expenses of a wedding or any other function.

A salaried individual, self-employed professionals and self-employed non-professionals can apply for a personal loan.

 Most banks will provide personal loan for a minimum of 1 year.

Most banks will provide personal loan for a maximum of 5 years.

The minimum age of the applicant must be not less than 21 years and the maximum age of the applicant at loan maturity must be 65 years.

 Yes, usually the banks charge a processing fee of 2-3 percent on the loan amount. You can however negotiate with the bank to reduce the fee.

Personal loan can be repaid in equal monthly instalments or EMI. You can provide a post-dated cheque or can give a standing order with your bank or through electronic transfer.

Personal loans can be prepaid in parts or fully at any stage. Some banks might charge a prepayment penalty whereas some banks will not. Some banks will not allow the part-prepayment. So, check all the documents before finalising with the bank.

Yes, you can club the income of your spouse to boost your eligibility to avail a personal loan.

Generally, the minimum amount limit that one can take a personal loan is Rs.1,000.

No, you don’t have to provide any security or collateral to take a personal loan.

Yes, you have the option to choose either the fixed or floating rate of interest.

The interest rate varies from banks to banks and it is within 14-26 percent depending on your profile and the scheme that you opt for.

Banks disburse the loan within 72 hours to 7 working days provided all the documents are in place.

Yes, banks refer your CIBIL score and credit report and the minimum CIBIL score requirement is 750+.

Yes, the CIBIL score affects the interest rate offered to you. If your CIBIL score is high and if you have a good repayment history, then the bank will offer you a lower interest rate.

You need to submit an identity proof as well as residence proof, your latest salary slip, form no. 16, last 6 months bank statement and a passport sized photograph that is to be affixed on the application form.

If you don’t have a bank account with the bank, it is not mandatory to apply for one. But, if you apply for a loan with your existing banker, then you will be eligible for a relationship discount.

Some banks let you register yourself for ‘Do Not Disturb’. The executives will not disturb you with cold sales calls.

The best way to apply for an personal loan is by using the online loan application tool at BankBazaar.com The tool can be accessed on this page allowing users to choose personal loan from various banks and NBFCS as per their selection.

Various banks and NBFC’s offer personal loans ranging from a minimum amount of Rs. 1000 to a maximum amount of Rs. 15 to Rs. 20 Lakhs. The maximum and minimum loan amount depends on the underlying bank as well as the personal financial details of the loan seeker.

Various banks offer different tenure for personal loans. The most common tenure period offered by majority of banks and NBFCs ranges between 12 to 60 months.

Yes, the fixed deposit interest is compounded based on monthly, quarterly, half-yearly or yearly interest rates. Individuals can utilize the FD interest rate calculator to determine the approximate interest they will be earning on their investment (principal amount) or FD account. Considering the fact that the FD has fixed terms, the interest compounding becomes rather simple with the interest payment frequency as one of the prime variable components.

Fixed deposit accounts can be opened under a cumulative or non-cumulative deposit scheme. Based on the type of the deposit scheme, the account will earn interest on the investment (principal amount) on either monthly, quarterly or annual basis. The account holder will have the option to choose the fixed deposit term ranging from few months to a maximum of 10 years. At maturity of a cumulative fixed deposit account, the account holder can choose to reinvest the interest along with the principal amount for an extended period of time.

Yes, the account holder can choose to receive the interest payment every month for the entire term of the fixed deposit account. Depending on the investment (deposit amount), term, and interest rate offered by the account, the monthly interest amount can be calculated. Most banks offer the fixed deposit interest calculators on their website that will come handy when you need to calculate the earnings and value of the investment.

A fixed deposit online calculator will help you calculate the interest that your money will earn when kept in a fixed deposit. This will take into account your investment that's the Principal amount on maturity after the interest is compounded on a monthly, quarterly, half-yearly or yearly basis. As an example let’s say that you have a sum of Rs.15, 000 that is deposited in your bank for a period 2 years the interest the bank is paying you is an annual interest rate of 5%, The interest will be compounded quarterly for this period.
The formula used by the bank will be A = P x (1 + r/n)nt I = A - P.
Maturity Value (A) = P x (1 + r/n)nt
= 15000 x (1 + 0.05/4)4x2
= 15000 x (1 + 0.0125)8
= 15000 x (1.0125)8
= 15000 x 1.104486101
Making the Maturity Value (A) = Rs. 16567.29.
And hence leading to the Maturity Value (FD) = Rs. 16567.29
Interest Earned Amount (I) = Rs. 1567.29.
Do all FDs give you tax benefits?
No. Only tax saver FDs give you a tax benefit.