Start investing in corporate bonds

June 18, 2020

Bank fixed deposits (FDs) have been the most popular retail investment product in India historically. But the FD interest rates have been continuously going down over the years and looking at current circumstances, they will probably remain at these low levels for some time to come.  The RBI repurchase rate (repo rate) is nearing an all-time low of  4%, which has also meant that banks have reduced their FD rates to as low as 5.1% (SBI for 1 year FD).

Repo rate

While investing in stocks gives an opportunity to earn a higher rate of return than FDs, it comes with a higher risk, which may not suit most people who currently invest in FDs. High quality corporate and PSU bonds are a great alternative to Bank FDs.  In some cases, investing in a Bank’s bond gives you almost 10 to 15% higher returns as compared to the same bank’s FD.

Indian retail investors have very little exposure to corporate bonds, due to a lack of understanding of the product and also because these have traditionally been a product sold to High Networth Individuals (HNIs) and institutions. As part of our Rainmatter initiative, we have now partnered with GoldenPi, a bonds platform democratizing access to bonds that were until now inaccessible to Indian households to power our corporate bonds platform.

Introducing investing in corporate bonds

With the help of GoldenPi, we are working with various bond houses to aggregate the best tax-free and taxable bonds for you. You can start investing in these bonds with a minimum of just Rs 10,000. As part of the beta release, we currently are offering tax-free bonds, and soon will have taxable bonds as well. The maximum limit per order is Rs 2 lakh currently.

Why tax-free bonds?

They carry an implicit sovereign guarantee (safer than bank FD) and currently yield around 4.5% tax-free. PSU Bank FDs currently have yields of around 5% to 5.5%  pre-tax and just around 3% to 3.5% post-tax (highest tax slabs), so tax-free bonds offer almost 30 to 40% higher yield as compared to bank FD.

How to invest

Visit to see the list of bonds currently being offered.

Tax-free bonds

Select the bond you wish to invest in(order window is open from 9 am to 3 pm)

Select the tax-free bond

Make payment

You will have to pay using your bank account mapped to the Zerodha account to transfer funds. You will not be able to pay using the funds lying in your trading account.

Once the payment is processed, the bonds will be credited to your demat account by the end of the day and will start showing up under your holdings on Kite and Console from the next day. The buy average price will also be automatically updated.

Unlike FDs, the bonds we are offering also trade on the exchanges. But bonds don’t trade as actively or as frequently as stocks, and hence the last traded prices (LTP) on the exchange may be misleading. But what this also means is that if you did decide to exit the investment before maturity (like breaking a bank FD), you can do so by placing a limit sell order directly from Kite on the exchange (we will soon start showing daily indicative prices of your bond holdings on Coin, if you wish to place a sell order on the exchange). But do note that if you do decide to sell before maturity, the price of the bond could have either gone up or down from your buying price based on how the interest rates in the economy have changed in the interim. Outside of the coupon or interest, you have earned, you could have a profit or loss based on the price you bought and sold (price typically goes up when interest rates in the economy go down, and vice versa) if you sell before maturity.

Please do let us know your feedback and suggestions on this TradingQ&A thread. If you are new to bonds, we’d suggest you get started learning about investing in Bonds on Varsity.

Happy investing,

Founder & CEO @ Zerodha

Post a comment

  1. Deepak says:

    What’s the timeline for letting the users invest in corporate bonds ?
    Need an exact time line no generic answers please (Zerodha team)

    • Shruthi says:

      Hi Deepak, we understand an exact timeline will help, however, sharing an estimate for now, this is expected to be on Kite in a few weeks. Will keep you posted.

  2. Rishik kedia says:

    Portal is not working. Please fix the issue

    • Shruthi says:

      Hi Rishik, we are working on making a wider selection of corporate and tax-free bonds available. We’ll keep you posted on it.

  3. AVINASH says:

    The page still not working

  4. Richard says:

    Your portal ( is still not working.
    Also not showing any bonds on Coin app.

  5. Aditya says:

    Your portal ( is still not working.

    Where can I buy corporate bonds?


    I have an account with you. I want to buy Corporate Bonds. Your portal ( is not working. Please look at it and resolve this problem urgently.

  7. satheesh says:

    does coin support FDs corporate and bonds now?

  8. Shirish says:

    Sorry I meant Bonds not Bonda 🙂

  9. Shirish says:

    No bonds available in Coin. Is there any other way to invest in Bonds. I was looking for Bonda and not bond funds.

  10. Kirti says:

    Still no sign of any bonds in coin, how can buy bonds through zerodha

    • Shruthi says:

      Hi Kirti, we’re working on making a wider selection of tax-free and taxable bonds available. Will keep you posted.

  11. Naveen Kadahalli says:

    Hi, can I gift the tax free bonds?(once I bought through zerodha?

  12. Ashvini Rastogi says:

    Please share when corporate and tax free bonds would be available on kite or console.

    • Shruthi R says:

      Hey Ashvini, we’re working on making a wider selection of tax-free and taxable bonds available. Will keep you posted.

  13. Prathyusha says:

    Provided links no more exist, did zerodha stopped selling bonds ?

    • Shruthi R says:

      Hey Prathyusha, we are working on making a wider selection of tax-free and taxable bonds available. Will keep you posted on this.

      • Karthick says:

        As of today 15-Aug-2023, I still see the same message in your dashboard for Corporate bonds, just like promise for SWP/STP.

  14. shakthimaan says:

    Where to see the Bonds that are under 80 CCF tax benefit?

  15. Viraj Shah says:

    This is just for trading in existing listed securities… Is there something in Zerodha through which I can apply for new issues of NCDs / Bonds

  16. Kannan says:

    Hello Team,

    I could see only the government bonds in section (G-secs on coin interface) but corporate bonds are not visible whereas I see corporate bonds on Golden Pie website.

    As i understand from Coin console, that Zerodha partners with Golden Pie for bonds investment, how does it differs on the list of bonds? Please clarify and advise how do I invest in corporate bonds (debentures) like TATA capital finance etc..


  17. Sharath says:

    Had bought 10 units of SBIN-N5. Now they neither appear in the kite dashboard nor the holdings. Also not able to find it in the drop down to sell.

  18. Shashank says:

    Can we pledge bonds in kite trading

  19. Chaitanya Khade says:


    How much time does it takes to credit sovereign gold bonds securities to d mat account??
    I have purchased this bonds around 10 days back till the time i only received amount paid confirmation mail

  20. Unnikrishnan says:

    Hi Bhuvanesh, I am trying to find out when can i buy a bond at the face value (during the issue, i suppose) and how can i do that ? because two bonds on the zerodha portal is offered at prices higher than the face value and low YTM compared to coupon. I want to buy at face value. Also is there a restriction on how much money an individual could invest in PSU taxfree bonds ? thank you …

  21. Kiran says:

    Can this be used to pledge to get margins ??

  22. Tejas Patel says:

    Hello Sir,
    Can retail investors buy NCD’s
    In Zerodha Account ?

    • Matti says:

      Yes, you can. Simply add the NCD to your Kite Marketwatch and place a buy order. Since these are listed on the exchange, the transaction works like any other stock.

  23. Punit says:

    List the banks accepted for paying for corporate bonds?

  24. Senthil kumar n says:

    Hi – Two Q’s..
    Can i invest in tier 2 bank bonds ?
    Applicable Transaction charges ?

  25. Tangudu neelakantha says:

    Coin app has not reflected the same I guess. Is it only available on web?

  26. Jitendra says:

    Liquidity is very important in debt instruments.
    Will you please give more details about liquidity in these bonds viz.
    (1)Can we prematurely withdraw these bonds?
    (2)What are the charges involved for premature withdrawal
    (3)How much time is required to get back my money etc.

    • Bhuvanesh says:

      1. Yes, you can try selling on the exchange. But the liquidity is patchy, but you need to be cognizant of the fact.
      2. We don’t charge any brokerage. Just the statutory taxes and charges will be applicable.
      3. The settlement is T+2, just like it is for stocks.

  27. Subbarao Chamidiboyena says:

    Can this be used to pledge to get margin?

  28. Harsh Doshi says:

    Where can I get list of all the taxable bonds/ NCDs for Retail investors in India on daily basis? Does Zerodha provide such list on daily basis?