Zerodha getting into the Fixed Deposit game is great news.

They are launching FD investing directly on their mutual fund platform, Coin, powered by a Delhi-based fintech startup called Blostem in which Zerodha's Rainmatter is also investing.

But, what does this really mean? And why is this great in my eyes? That is what this is about.

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See, the benefit of all these new-age tech-based FD investing platforms is that tou can invest in an FD without having to open a savings account with that specific bank.

- That one step is the BIGGEST point of friction which is being eliminated with more and more platforms coming up - Like Stable Money

- How does it work? You open the app, pick an FD from a list of banks, complete your KYC once, and pay. Done

Players like Stable Money proved the model. And its nice to see so many bigger platforms make a foray since.

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But, why am I so happy about this?

I have many reasons. But two stand out (both of which I have written about before).

- First, it makes FDs accessible and attractive, offering rates up to 9.10% from Small Finance Banks

- Second, and this is the REAL reason, it’s about saving investors from themselves

I have said this again and again. MOST people should not be picking stocks.

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They get lured in by the promise of 4x returns. They see screenshots on social media. They dive in.

But, then what happens? They lose money. A LOT of money.

Why?

- Cuz they have no real risk appetite. They have no investment thesis. They are just gambling

- When the market turns, they panic-sell at the bottom. They end up with a huge, negative return

Had those same people just put that money into an FD... what would have happened? They wouldn't be rich. But their capital would be 100% safe. (Up to ₹5 lakhs is DICGC insured).

They would have earned a guaranteed 7%, 8%, or 9% or whatever. And, they would have fared SO much better.

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This move is also a window into Zerodha's core strategy.

They are building a "Great Wall" between their two platforms.

- Kite is for active traders. The fast-moving, high-risk game

- Coin is for passive, long-term investors. MFs, G-Secs, and now FDs

Not 100% sure how right I am, but it is my understanding that it’s a deliberate design to reduce "impulsive trading and emotional decision-making."

Thus, a very positive trajectory. No?