Company Fixed Deposit is a fixed deposit scheme offered by a company. It works similar to a bank deposit where you earn interest income. Company FDs offer much higher returns than bank FDs, since they entail higher risks. The higher the risk, the higher is the interest rate offered.

.Furthermore, company fixed deposits are 'unsecured'. This means, you have no lien on the assets of company, in case it goes into financial difficulties and is wound up.Hence, it is of utmost importance to obtain professional financial advice with regards to Company Fixed Deposit.

Returns offered by Company Fixed Deposits:
Returns offered by Company fixed deposits are higher compared to the Bank FD. However higher the return higher the risk. Hence, be careful before choosing a company with say a 15 per cent coupon rate as against one with a 11 per cent coupon. While the higher return may be tempting, the safety may be lower.
Before investing you can also check for the rating given to the Company FD and also the past track record of making timely interest payments.