Why are more than half of FD investors exploring alternative investments?
For years, fixed deposits have been the comfort zone for Indian savers. They offer predictable returns and are easy to understand. But as investors look more closely at what their money earns after tax and inflation, some are beginning to ask if they should put at least a part of their savings elsewhere.
A 2026 online survey by Per Annum, an alternative investment platform, of 10,000 investors with existing or past exposure to fixed deposits and the stock market found that 52% of respondents had moved a portion of their FD corpus into alternative investments. The search for higher yields and greater control over their portfolios was cited as a key reason.
HIGHER RETURNS ARE A KEY REASON
The biggest factor behind the shift appears to be the search for better returns.
Fixed deposits remain popular because of their predictable nature, but investors also have to look at the returns they actually earn after taxes and the impact of inflation. For some savers, this has encouraged them to explore alternatives such as peer-to-peer (P2P) lending.
According to the survey, 52% of respondents had already shifted a part of their FD money to alternative investments, rather than just considering the option.
P2P lending is among the alternative investment avenues being explored by investors looking beyond FDs.
Under the model, investors lend money to borrowers through a platform and can earn returns from the interest paid by borrowers. However, unlike a traditional fixed deposit, P2P lending does not come with a guaranteed return or repayment.
INVESTORS ARE NOT GIVING UP ON FDs COMPLETELY
The survey does not suggest that investors are walking away from fixed deposits altogether.
Around 35% of respondents said they viewed P2P lending as an additional allocation alongside their FDs. This means they were using alternative investments as another part of their portfolio rather than replacing their existing fixed deposits.
Another 13% continued to keep most of their money in FDs, mainly because of the safety they offer.
The findings therefore point towards diversification rather than a complete shift away from traditional savings products.
SMALLER CITIES ARE ALSO JOINING THE TREND
The interest in alternative investments is not limited to India’s biggest cities.
According to the survey, 62% of respondents were from Tier 2 and Tier 3 cities, while 38% were from Tier 1 cities.
The data suggests that investors in smaller cities are also exploring newer investment products as digital platforms make them easier to access.
This could also indicate a wider change in how people outside major metros manage their savings and investments.
WHO IS EXPLORING ALTERNATIVES?
Investors between 35 and 50 years formed the largest age group in the survey, accounting for 35% of respondents. This group represented a combined portfolio value of Rs 53 crore.
Investors aged 18 to 35 accounted for a portfolio value of Rs 21 crore.
The survey also found that senior management professionals made up 40% of respondents, while business owners accounted for nearly 30%.
Female investors represented 17% of the respondents, with a combined portfolio value of Rs 8.6 crore.
Meanwhile, the survey’s findings point to a gradual change in investor behaviour rather than a sudden exit from fixed deposits.
For some investors, the FD continues to serve the purpose of providing predictable returns and a sense of safety. At the same time, they are exploring other avenues for a potentially higher return on a portion of their money.
In effect, the trend is less about choosing between an FD and alternative investments and more about deciding how much money should go into each.
As investors become more comfortable with digital investment platforms and look for different ways to diversify, alternative investments could increasingly find a place alongside traditional savings products.
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