58 plain-language definitions across 17 letters — use the jump bar to skip to any letter. Every term links back to the relevant product page, guide, or comparison so you can verify how the term shows up in real products.
This glossary defines the acronyms and terms used across 14paisa product comparisons and guides — from bank FDs (CAGR, DICGC) to sovereign instruments (FRB, T-Bill, G-Sec) to small-savings schemes (PPF, SCSS, SSY). Each entry below is a self-contained answer; the "See also" links beneath it point to the longer-form guide, the dedicated product page, or the comparison engine so you can sanity-check the rate or rule in real context.
14paisa is an educational comparison platform — we are not a SEBI-registered advisor. Definitions on this page are kept plain-language on purpose; for any binding rule (tax treatment, eligibility, rate) verify against the relevant regulator or the linked product page before investing.
Section 80C of the Income-tax Act lets eligible Indian taxpayers deduct up to ₹1.5 lakh per year from taxable income for qualifying investments and expenses — PPF, ELSS, EPF, NSC, life-insurance premiums, and home-loan principal repayments are the most-used. The deduction reduces your taxable income; the investment itself is taxed again on exit at slab rate unless it qualifies for EEE status (e.g. PPF).
Section 80CCD(1B) gives an additional ₹50,000 deduction over and above the Section 80C ceiling on contributions to the NPS Tier-I account. The deduction is available only to salaried and self-employed individuals who choose to contribute to NPS — it stacks with the regular 80C limit, so high earners can plausibly shelter up to ₹2 lakh in total.
AA is the second-highest investment-grade credit rating (just below AAA) assigned by Indian rating agencies. AA-rated issuers have a very strong capacity to meet obligations but carry marginally higher credit risk than AAA — yields reflect this with a small premium. Still considered safe for conservative investors.
AAA is the highest credit-rating tier assigned by Indian rating agencies (CRISIL, ICRA, CARE, India Ratings) to issuers judged to have the strongest capacity to meet financial obligations. AAA corporate bonds carry the lowest credit risk in the non-sovereign segment but still sit above government-backed instruments like G-Secs, T-Bills, and sovereign-guaranteed PPF/NSC.
Aadhaar e-KYC is the paperless identity verification process that uses your Aadhaar number and OTP/biometric authentication to instantly verify identity and address for financial accounts — bank FDs, demat accounts, mutual funds, NPS Tier-I, post office schemes, and insurance. Replacing earlier paper-based KYCs, it has cut onboarding time from days to minutes and is the most-used KYC channel in India.
Association of Mutual Funds in India (AMFI) is the self-regulatory body overseeing India's mutual-fund industry. AMFI publishes the authoritative daily NAV for every scheme, registers distributors, and sets the standard categorisation framework. NAV data on 14paisa debt-fund comparisons comes from AMFI.
Annual Percentage Rate (APR) is the yearly cost of borrowing expressed as a percentage, including interest plus fees and compounding. APR is most commonly used for loans and credit cards in India. For deposit products (FDs, bonds) the equivalent is the annualised yield — APR is rarely quoted by banks on FDs since the in-hand rate is plain interest, while APR only matters when fees are layered on.
BBB is the lowest investment-grade credit rating, sitting just above speculative-grade (BB and below) — issuers are judged to have adequate capacity to meet obligations but with greater sensitivity to adverse economic conditions. BBB-rated bonds pay meaningfully higher yields than AAA/AA but credit deterioration is a real risk; not commonly held by retail investors.
Compound Annual Growth Rate (CAGR) is the smoothed annualised return that shows what an investment's growth rate would have been if it had grown at the same rate every year. CAGR is the standard way to compare multi-year debt-fund returns, SGB holding-period gains, and FD-vs-debt-fund analyses — properly accounts for compounding versus simple-interest comparisons.
Credit Analysis and Research Limited (CARE) is one of SEBI-registered credit rating agencies in India alongside CRISIL, ICRA, and India Ratings. CARE assigns credit ratings — AAA to D — used by investors to judge bond issuer quality. Its ratings are cited on corporate-bond prospectuses alongside the other three agencies.
Central Board of Direct Taxes (CBDT) is the apex authority under the Finance Ministry that administers the Income-tax Act, 1961, TDS rules, and ITR e-filing. CBDT notifications are the only legal source for Section 80C / 80CCD / TDS thresholds cited across 14paisa product pages.
CIBIL (TransUnion CIBIL) is India's oldest credit bureau, maintaining credit histories on individuals and businesses — repayment history, outstanding debt, credit mix, and recent enquiries. CIBIL scores range from 300–900, with 750+ considered ideal for unsecured loan approvals.
A credit score is a three-digit summary of your credit history used by lenders to judge loan-eligibility — in India the standard is the CIBIL score (300–900), with 750+ considered good. Credit scores do not directly affect FD / bond / debt-fund returns but govern access to loans at competitive rates.
CRISIL Ratings is India's largest credit rating agency (part of S&P Global) — assigns ratings AAA to D for issuers across corporates, banks, NBFCs, and municipal bonds. CRISIL-rated AAA / AA bonds / FDs are widely accepted as the benchmark for "highest safety in corporate debt" on comparison platforms.
Cash Reserve Ratio (CRR) is the share of a bank's total deposits it must hold with the RBI as liquid cash — currently 4% of net demand and time liabilities. CRR is a monetary-policy lever; raising it drains liquidity from the banking system, lowering it injects funds. CRR does not directly affect retail deposit rates but signals the rate cycle.
Deposit Insurance and Credit Guarantee Corporation (DICGC) is a subsidiary of RBI that insures deposits held in Indian commercial and co-operative banks — covers up to ₹5 lakh per depositor per bank (principal + interest). DICGC does not cover cooperative credit societies, NBFCs, or primary dealers; PSU bank FDs up to ₹5 lakh are effectively sovereign-equivalent for the insured portion.
Double Taxation Avoidance Agreement (DTAA) is a bilateral tax treaty India signs with other countries to prevent the same income being taxed twice — relevant for NRIs receiving Indian interest, dividends, or property rental income. Claiming DTAA benefits requires a Tax Residency Certificate (TRC) from the country of residence plus Form 10F.
EEE (Exempt-Exempt-Exempt) is a tax status where the principal, accumulated interest, and final maturity proceeds are all exempt from income tax. PPF, EPF, and Sukanya Samriddhi Yojana all qualify for EEE; NSC and FDs do not (those are EET — exempt only at contribution). EEE is the highest tax efficiency category and the reason PPF remains a top recommendation for long-term wealth.
Equity-Linked Savings Scheme (ELSS) is an open-ended equity mutual fund qualifying for Section 80C deduction — minimum 3-year lock-in (shortest among 80C options), returns are market-linked (no guaranteed yield), and dividends/gains are taxed per slab after April 2023. Often pitched for tax-saving but the EEE-vs-EEEET comparison is structurally weaker than PPF.
eNPS is the online NPS Tier-I / Tier-II account opening and contribution channel managed by PFRDA through eNPS.nsdl.com — single-KYC onboarding via Aadhaar / PAN, with 50+ approved Pension Fund Managers to choose from. eNPS contributions qualify for Section 80CCD(1B) over and above the regular 80C ceiling.
Employees' Provident Fund Organisation (EPFO) is the statutory body administering India's EPF, EPS (pension), and EDLIS (insurance) schemes for the salaried workforce. EPFO publishes the official EPF interest rate (currently 8.25% p.a.) and sets withdrawal / advance rules. EPF is one of the few instruments with full EEE tax status.
Foreign Currency Non-Resident (FCNR) deposit is an NRI / PIO fixed-deposit account opened in foreign currency (USD, GBP, EUR, JPY, AUD, CAD) — principal and interest are fully repatriable, no TDS in India, exchange-rate risk is borne by the depositor. FCNR is the cleanest NRI parking vehicle for overseas earnings because there is no Indian tax leakage.
Fixed Deposit (FD) is a bank deposit with a fixed tenor and a contracted interest rate — interest is fully taxable at slab rate, banks deduct TDS above ₹40,000 a year (₹50,000 for seniors). Up to ₹5 lakh per depositor per bank is insured by DICGC, including accrued interest. Senior-citizen FDs usually pay 0.5% above the general category rate.
Foreign Exchange Management Act (FEMA), 1999 is the central law governing cross-border capital flows for Indian residents and NRIs. FEMA controls NRI account types (NRE / NRO / FCNR), repatriation ceilings (USD 1 million from NRO per year after tax), and the Liberalised Remittance Scheme (LRS) of USD 250,000 per financial year.
RBI Floating Rate Savings Bond (FRB) — 7-year sovereign instrument issued by RBI on behalf of the Government of India, coupon reset every six months against NSC rate, currently 8.05% p.a. Sovereign guarantee means no principal risk; interest is fully taxable at slab with no TDS at source.
Government Security (G-Sec) is a tradable debt instrument issued by the central or state government — T-Bills (≤1 year), Dated G-Secs (2–40 year), and FRB (floating 7-year). All G-Secs carry the sovereign guarantee; the yield curve is the benchmark for pricing all other rupee debt. Retail access is via RBI Retail Direct.
Insolvency and Bankruptcy Code (IBC), 2016 is the unified framework for resolving corporate insolvency in India — sets the time-bound resolution process, defines the Committee of Creditors' powers, and established NCLT / NCLAT as the adjudicating authorities. Defaulting NBFCs and corporates are sent through IBC; AA- and AAA-rated bonds avoid this risk.
ICRA Limited (formerly Investment Information and Credit Rating Agency of India) is one of SEBI-registered credit rating agencies in India — assigns AAA-to-D ratings alongside CRISIL, CARE, and India Ratings. ICRA ratings on corporate-bond prospectuses cover NBFCs, banks, manufacturing, and infrastructure issuers.
Inflation is the rate at which the general price level of goods and services rises. India tracks two indices — CPI (Consumer Price Index, used as the headline retail inflation measure; RBI's 4% ± 2% target applies) and WPI (Wholesale Price Index, producer-side). Real return on any fixed-income investment is the nominal yield minus inflation; an FD at 7% with 6% CPI delivers ~1% real.
Insurance Regulatory and Development Authority of India (IRDAI) is the statutory regulator for India's life, health, and general insurance industry — sets surrender-value disclosures, annuity-rate tables, and insurer solvency norms. IRDAI-published surrender values are the legal reference for any insurance-linked investment claim.
Kisan Vikas Patra (KVP) is a Post Office small-savings certificate that doubles the invested amount in 115 months (~9.5 years) — the current effective compounded annual rate is ~7.5%. KVP is no longer tax-free at maturity (since 2018 Budget) and earns EET status. Suitable for conservative long-horizon savers; sovereign-backed.
Know Your Customer (KYC) is the identity-verification process required for every Indian financial account — bank, demat, mutual fund, NPS, insurance, post office. KYC channels include Aadhaar e-KYC, video KYC, and offline Aadhaar-paper-based OVD. Once KYC is done with one regulated entity, CKYC makes it portable.
Liberalised Remittance Scheme (LRS) allows resident Indians to remit up to USD 250,000 per financial year outside India for permitted current and capital account transactions — investments, education, travel, gifts, maintenance. LRS is the framework governing outbound remittances; FEMA prohibits direct use for unauthorised activities.
Post Office Monthly Income Scheme (MIS) is a 5-year Post Office scheme paying monthly interest at 7.4% p.a. on the principal — interest is fully taxable at slab rate and TDS applies above the threshold. MIS is suitable for retirees needing predictable monthly cash flow; principal is sovereign-guaranteed.
Net Asset Value (NAV) is the per-unit market value of a mutual-fund scheme — the total asset value minus liabilities, divided by outstanding units. Published daily by AMFI, NAV is the authoritative price at which mutual-fund buy/sell transactions settle. NAV returns differ from point-to-point returns because they ignore the entry/exit load and timing.
Non-Convertible Debenture (NCD) is a corporate-bond-like fixed-income instrument listed on exchanges — fixed or floating coupon, secured or unsecured, AA or lower-rated. NCD tranches are usually rated by CRISIL / ICRA / CARE / India Ratings; retail NCD issues frequently offer slightly higher yields than bank FDs of the same tenor.
National Pension System (NPS) is a market-linked defined-contribution pension regulated by PFRDA — Tier-I (locked till 60, partial withdrawals tightly restricted) and Tier-II (flexible). NPS contributions qualify for Section 80CCD(1B) over and above 80C; at exit up to 60% can be taken tax-free but the remaining 40% must buy an annuity. PFRDA-licensed fund managers include LIC, SBI, HDFC, ICICI, UTI, Kotak.
Non-Resident External (NRE) account is an NRI bank account denominated in INR but funded from foreign-exchange remittances — both principal and interest are fully repatriable, interest is tax-free in India, no TDS. NRE FDs are the cleanest NRI parking vehicle for overseas earnings.
Non-Resident Ordinary (NRO) account is an NRI bank account for managing Indian-source income (rent, dividend, pension) — interest is taxable, only up to USD 1 million per financial year can be repatriated (after tax and Form 15CB/15CA). Bonds like the RBI FRB must be held in an NRO demat account.
National Savings Certificate (NSC) VIII Issue is a 5-year Post Office / bank small-savings scheme — current rate 7.7% p.a., compounded annually but credited only at maturity, fully taxable at slab except for Section 80C deduction on the deposited principal (making it effectively EET). Sovereign-backed, available at any Post Office and most banks.
Permanent Account Number (PAN) is the 10-character alphanumeric identifier issued by the Income Tax Department — mandatory for any financial transaction above ₹50,000, all mutual-fund folios, demat accounts, FD above ₹50,000, NPS, and property purchases. PAN is the primary KYC identifier under CKYC.
Pension Fund Regulatory and Development Authority (PFRDA) is the statutory regulator for NPS, APY, and PFRDA-licensed pension fund managers. PFRDA publishes official NPS returns, Tier-I / Tier-II rules, and the list of approved annuity providers at exit.
Post Office Time Deposit (PO TD) is the Post Office equivalent of a bank FD — 1, 2, 3, or 5-year tenors, currently 6.9%–7.5% p.a. interest, fully taxable, sovereign-backed. Section 80C deduction available only on the 5-year PO TD (qualifying deposit). Suitable for those who want bank-FD-like simplicity with sovereign guarantee.
Public Provident Fund (PPF) is a 15-year sovereign-backed small-savings scheme — current rate 7.10% p.a., compounded annually, full EEE tax status. Maximum ₹1.5 lakh per year deposit (qualifies for Section 80C). Partial withdrawals allowed from Year 7; loan against PPF available from Year 3. NRIs cannot open fresh PPF (FEMA restriction) but can continue existing accounts.
Reserve Bank of India (RBI) is India's central bank — sets monetary policy (Repo Rate), issues G-Secs / T-Bills / FRB, regulates commercial and co-operative banks, publishes DICGC insurance cover and the official currency-policy framework. RBI is the only authoritative source for government-security rates and auction calendars.
Repo Rate is the rate at which RBI lends short-term funds to commercial banks against government securities — the primary lever of monetary policy, currently 5.50%. Changes ripple through bank FD rates, lending rates, and corporate-bond yields within 1–3 months; bank FD rates typically trail Repo moves by 1–2 quarters.
Reverse Repo is the rate at which RBI borrows short-term funds from commercial banks — usually 25 bps below Repo. Reverse Repo drains liquidity when RBI wants to curb inflation. Movement of Repo / Reverse Repo together signals monetary stance shifts.
Senior Citizens Savings Scheme (SCSS) is a Post Office scheme exclusively for residents aged 60+ — current rate 8.20% p.a., 5-year tenor (extendable by 3 years), quarterly interest payouts, taxable. Maximum ₹30 lakh deposit, qualifies for Section 80C deduction. Often the top pick for retirees seeking predictable income with sovereign guarantee.
State Development Loan (SDL) is a state-government-issued tradable bond maturing in 10 years — sovereign-equivalent because state-government securities carry an implicit central-guarantee structure. Retail investors buy SDL indirectly via RBI Retail Direct or through debt-fund portfolios that hold SDLs as part of the duration allocation.
Securities and Exchange Board of India (SEBI) is the market regulator for Indian securities — equities, bonds, mutual funds, and alternate investment funds. SEBI registers investment advisors and regulates corporate-bond / mutual-fund disclosures. SEBI Investor Awareness is the cleanest sanity check against bank/AMC marketing claims.
Sovereign Gold Bond (SGB) is an RBI-issued bond denominated in grams of gold, with the value linked to domestic gold prices — issued in tranches, 8-year tenor (exit allowed from Year 5), 2.5% p.a. interest on the principal in addition to gold-price appreciation. SGBs are sovereign-guaranteed and exempt from capital-gains tax if held to maturity (8 years).
Systematic Investment Plan (SIP) is a method of investing fixed amounts at regular intervals (usually monthly) into a mutual-fund scheme — leverages rupee-cost averaging and disciplined saving. SIPs are most commonly used for equity funds but work for debt funds too; SIP returns differ from lump-sum NAV returns purely due to averaging.
Statutory Liquidity Ratio (SLR) is the share of a bank's net demand and time liabilities it must hold in the form of gold, government securities, or cash — currently 18%. SLR is what channels bank deposits into government-bond markets; it is not a direct lever on retail deposit rates but indirectly tightens liquidity.
A sovereign guarantee means the issuer is the Government of India — G-Secs, T-Bills, FRB, SGB, PPF, NSC, SSY, SCSS, KVP, PO TD, EPF, and SDL all qualify. Sovereign-backed instruments cannot, by definition, default on principal. The rate of return is therefore lower than on credit-risk-bearing corporate FDs / bonds.
Sukanya Samriddhi Yojana (SSY) is a Post Office small-savings scheme exclusively for a girl child below 10 years of age — maximum ₹1.5 lakh per year, current rate 8.2% p.a., 21-year tenor (withdrawable at 18 after marriage), full EEE tax status. Highest post-tax return across all small-savings schemes for parents of eligible girls.
Treasury Bill (T-Bill) is a short-term government security issued by RBI on behalf of the Government of India — tenors are 91 days, 182 days, and 364 days, sold at a discount and redeemed at face value (no periodic coupons). T-Bills are the sovereign benchmark for short-term rates; retail-accessible via RBI Retail Direct or debt-fund portfolios.
Tax Deduction Account Number (TAN) is a 10-character alphanumeric identifier issued to entities that deduct TDS — mandatory on all TDS return filings under Section 203A of the Income-tax Act. Banks, employers, and property-payers deducting TDS register and quote TAN on Form 16 / 16A.
Tax Deducted at Source under Section 195 applies to any payment made to a non-resident / NRI — interest, dividend, royalty, fees for technical services, capital gains on Indian assets. TDS rates vary by income type (often 20% for interest) and DTAA treaties can lower them. NRI banks deduct TDS on NRO interest; NRE interest is exempt.
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<a href="https://www.14paisa.com/glossary">14paisa Indian Finance Glossary</a> — A–Z plain-language definitions of APR, CAGR, NAV, SIP, ELSS, FD, PPF, NPS, SCSS and other Indian finance terms.
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