What is the difference between the bonds and FDs of PSU banks? -Sushant
Whenever you buy a PSU bank’s bond, you can't sell it back to the bank. You can get loans against it, but you can sell it only at the end of its term. You keep getting periodic returns on the bond you’ve invested in. Furthermore, in the hierarchy of payments, bond holders are given priority over depositors.
In comparison to that, you can prematurely encash a fixed deposit. There is no difference when it comes to the safety of these two products, especially in the case of PSU banks.
This article was originally published on November 01, 2012.
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