Subordinated Debts

"A Subordinated Debt (Sub-Debt) refers to an investment scheme that Non-Banking Financing Companies provide as per the directions of Reserve Bank of India. Sub-Debts offer greater returns on the principal invested when compared to the returns generated from a regular savings account. The offer of Sub-Debt is being made to enhance the long-term resources of the Company and to augment the business activities carried on by the Company. This will be treated as a part of Tier II capital of the Company. Sub-Debts Investors need to remember that they cannot withdraw money before maturity without necessary approvals from the regulatory authorities.

It is necessary for every individual to diversify his or her investment portfolio into various types of fixed income and variable income investment sources. A longer tenure for your Sub-Debt means you invest for longer period of time to enjoy the power of compounding returns."

Advantages of Subordinated-Debt

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Investors can look forward to the following benefits from their investments.

• Assured Returns- Periodical and guaranteed return on investments
• High Capital Appreciation- Cumulative Subordinated-Debts compounds interest annually. Hence, SD amount is substantially appreciated by the end of tenure.
• Additional Source of Income- The investor can select the frequency for non-cumulative SD plans. Therefore, they can act as an additional source of income.

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