Same “fixed income” label — different risks
Bank FDs pay a contracted rate from a deposit-taking institution. Corporate bonds / NCDs pay coupons from a company; if the issuer struggles, you can lose interest or principal.
Retail bond shelves (for example on investing apps) often show 10–12% yields next to ~6–8% FD rates. That gap is not free money — it prices risk.
Compare rates, then risks
Use the Bond vs FD Calculator only for rate-path math on the same principal and tenure. Then ask separately:
- Who is the issuer and what is the credit rating?
- Can I sell early (liquidity) without a large discount?
- How are interest and gains taxed for me?
- Is there a call/put or complex structure?
Side-by-side (simplified)
| Bank FD | Corporate bond / NCD | |
|---|---|---|
| Return | Contracted deposit rate | Coupon + price path / YTM |
| Credit risk | Bank (DICGC limits apply to deposits) | Issuer-specific |
| Liquidity | Premature withdrawal rules | Secondary market / hold to maturity |
| Typical use | Safety bucket | Higher-yield sleeve after risk check |