Understanding the dangers of small finance bank and corporate fixed deposits
While fixed deposits from small finance banks and corporations often provide better interest returns, they also come with unique sets of risks. Deposits in small finance banks are overseen by the RBI and protected by DICGC insurance, which covers up to ₹5 lakh for each depositor per bank; however, any balance exceeding this amount is subject to the bank's fiscal health. Conversely, corporate FDs lack DICGC protection, meaning the return of your principal relies entirely on the financial stability of the issuing company.
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