Bonds as alternative to FDs!

SEBI allowing companies to issue bonds or non-convertible debentures (NCDs) at minimum face value of Rs.10,000/- has opened up retail participation in the segment. It is currently at four percent. The bond marketplaces & bond investment platforms expect retail participation to grow from 4 percent to around 10-12 percent within the next two years. According to these firms, there are around five to six lakh retail bond investors in the country, which is expected to grow to around two million over the next three years. This bond investment gives approx. 50 percent higher returns than fixed deposits (FDs) with lower risks than equity and also brings certainty to the returns. With this move Sebi is giving investors a clear alternative to FDs.