Fixed Deposit

A Fixed Deposit (FD), also called a Term Deposit or "Mudhdhati Khata," is a deposit account where you lock a lump sum with a bank or finance company for a fixed tenure (typically 3 months to 5 years) at a pre-agreed interest rate that stays fixed for the entire term. It is meant for individuals, minors (via guardian), NRNs, firms, and institutions who want guaranteed, higher returns than a savings account on money they don't need immediate access to. In Nepal you generally need a linked savings/current account at the same bank, into which the principal and (usually quarterly) interest are credited. Rates sit within Nepal Rastra Bank's interest-rate corridor, senior citizens typically get an extra ~1%, tax is deducted at source (TDS) under the Income Tax Act 2058, and you can borrow up to ~90% of the deposit against the FD instead of breaking it early.