Another concern is that you may not be able to make a premature withdrawal from a company FD. This means that you can face a liquidity crunch. In times of a financial emergency, this can be quite troubling. If this is something that is not acceptable to you, then you may want to avoid investing in a company FD.
Moreover, to deal with this situation, it is better to have a diverse investment portfolio. Depending on your age, earnings and risk handling capacity, you can decide on how much to invest in a company or bank FD besides other options such as mutual funds and stocks.
For example, a new investor who is more open to risks can invest more in a company FD. On the other hand, someone who is nearing their retirement may be looking to keep risks at an absolute minimum. Herein, a larger portion of or a complete investment only in a bank FD would be much more suitable.
Thus, company and bank FDs can each come with their share of pros and cons. It is important to be aware of and evaluate the same before investing in the same.