A non-callable fixed deposit cannot be prematurely withdrawn before its maturity. Because the bank is assured of the funds for the full tenure, it often offers a slightly higher interest rate compared with a regular callable FD.
| Characteristic | Non-callable FD | Callable FD |
|---|---|---|
| Withdrawal before maturity | Not allowed | Allowed with penalty |
| Interest rate | Higher by around 0.10–0.20% | Standard |
| Liquidity | Low | Moderate |
| Suitable for | Investors who are certain they won’t need funds early | Those who may need access to funds |
Non-callable FDs are suitable for investors seeking slightly higher returns and who are confident they will not need to access their funds during the deposit’s term. Ensure that you have sufficient liquidity elsewhere before locking your money in a non-callable deposit.
