The only benefit of choosing Corporate Fixed Deposits over Bank Fixed Deposits is higher interest rate. Corporate Fixed Deposits gives you better return but bear a risk of losing money if company defaults. Thus the advantage of higher returns gets nullified with the higher risk.
Wealth2Health: Fixed Deposits with loan-against-deposits up to 75%
To overcome this neutrality, Dewan Housing Finance (DHFL), Triple A-rated Housing Finance Company, has come out with a unique product “Wealth2Health”, a combination of fixed deposit with loan-against-deposits, which allows up to 75% withdrawal during healthcare emergencies with an option to reinvest the same money.
In Fixed Deposits, once you deposit money you cannot get any other benefits till maturity. You will only get a prefixed return along with the principal amount at maturity. Though you can break and withdraw money but premature withdrawal comes with a penalty which might turn your return into negative figures.
The ‘Wealth2Health’ deposit scheme comes with an option of withdrawing up to 75% of the deposited amount without any penalty. The best part is that there will not be any additional interest rate on the withdrawal amount. The interest on the withdrawal cum loan will be setoff with the interest rate of fixed deposits. But remember there fixed deposit interest will be provided only on the remaining amount in the fixed deposit. This means no interest will be given on the withdrawal amount.
Suppose you open a fixed deposit of Rs 1,00,000 with DHFL for one year on 1st April at 9.00% p.a. Due to come health problems, you withdrew Rs.75,000 on 1st May and re-deposited this amount on 1st September. So the interest on Fixed Deposit would go like this:
- Rs. 1,00,000/- x 1 month x 9% p.a. = Rs. 750/-
- Rs. 25,000/- x 4 months x 9% p.a. = Rs. 750/-
- Rs. 1,00,000/- x 7 months x 9% p.a. = Rs.5,250/-
So, by doing so you forgone your interest of Rs. 2,250/- but avoided the penalty of premature withdrawal.
Features of Wealth2Health Scheme
- The Minimum Deposit under Wealth2Health deposit Scheme is fixed at Rs. 25,000/- which will fetch interest rate in the range of 9% to 9.50% for tenure of 12 months to 60 months maturities.
- Only Individuals are allowed to avail Wealth2Health deposit Scheme. HUF, Company, Partnership firms etc. are not liable to take this scheme.
- Wealth2Health deposit scheme comes with a deposit card, which is filled with the maximum limit of 75% of the deposited amount.
- The deposit card can be used to pay the medical bills and hospital bills at cashless hospitals at a discounted price.
- The first deposit holder could use the card for any family members.
- Accidental Death Insurance Cover of Rs.1 lacs is also attached with the card for first deposit holder.
- The withdrawal amount can be repaid once the insurance amount is received from the Insurer.
- The updated List of Medical Institutions and Hospitals is available on www.health4sure.in. Further, for any query you can send mail at email@example.com, with a copy to firstname.lastname@example.org
- For the details of available discount, you can call at the Vidal call center at 08049166710.
- Since this is not an Insurance Produce, you will not get any deduction under section 80D.