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Fixed maturity plans lose their shine after delay in full redemptions

Downgrades for Reliance Home Finance, Reliance Commercial Finance spook investors and distributors too.

Illustration: Binay Sinha
Illustration: Binay Sinha

Interest in fixed maturity plans (FMPs), from both distributors and investors alike, seems to have waned after a few companies delayed full redemption in certain schemes.  About 24 schemes hit the market in April, according to Value Research. The period between January and March typically sees an uptick in the launch of FMPs; close to 139 plans hit the market this year. “Distributors who have not understood the product completely and investors banking on fixed returns similar to those of fixed deposits, are the ones who have stopped showing interest in the ...