The Indian economy has shown remarkable growth after the pandemic and is continuously working towards ensuring financial stability for its residents and those living outside the country. The SBNRI survey states that 35% of the Indian population in the UK plans to return to their home country after retirement. With the growing economy, the world is bullish on investing in India.
There are various investment opportunities, including real estate, commercial FDs, Bonds, etc. altGraaf introduced a new investment option: invoice bill discounting. The platform aims to democratise investments for individual investors in India and worldwide.
This blog will discuss the top investment avenues available in India, along with their risks and returns. Let’s get started!
Top Investment Options in India
Here is a list of the top investment options in India.
1. Invoice Bill Discounting
Savvy investors are always on the lookout for investments beyond the traditional options. Invoice discounting is an intelligent option for investors to earn high returns within a shorter tenure. Invoice Bill Discounting is a financing method where a seller provides goods or services to a buyer with an agreed credit period for payment. Earlier invoice discounting was available on to HNIs or Ultra HNIs. Still, altGraaf is now on the path to making it accessible to individual investors in India and those residing out of India. The five types of invoice discounting offered on the platform are as follows:
1. altWings
Through altWings, an invoice bill discounting product by altGraaf, individuals can invest against the invoice receivables of business via altGraaf for a 30- 90-day tenure against 12-14% annual returns. altGraaf’s rigorous credit screening process ensures that only creditworthy companies are listed on the platform, offering investors transparency and confidence.
2. altBlu
There are two versions of the altBlu invoice bill discounting product: one with trade credit insurance and escrow control and the other with escrow control only. The insurance-backed option covers up to 90% of the principal if the buyer fails to pay, providing added security in insurance protection compared to the latter version. With rigorous due diligence, altGraaf ensures only creditworthy borrowers access the platform, offering investors a balanced blend of security and growth potential.
3. altSmart
altSmart allows individual investors to invest against businesses’ invoice receivables via the altGraaf platform for a 30-90-day tenure. This invoice bill discounting product is secured by a bank guarantee with escrow control on repayments, ensuring returns even in the event of buyer default. With altSmart, investors diversify portfolios with stable returns and contribute to economic growth while enjoying a hassle-free investment experience.
4. altArmour
altArmour is an invoice bill discounting product that offers individual investors to earn returns by financing business invoices, but instead of a bank guarantee, each invoice is protected by trade credit insurance. The insurance protects investors’ principal and interest entirely if the buyer defaults. The product offers a 90-day tenure with an 11-12% yield, managed through an escrow account. altGraaf processes insurance claims to ensure investor repayments even in case of defaults.
Like all investments, invoice bill discounting product investments carry risks, and investors must review all investment opportunities carefully before investing. However, with these choices of Invoice Discounting products across the risk spectrum from very low to high risk, investors can select opportunities that align with their risk appetite and return expectations.
Primary Benefits of Investing in Invoice Discounting
- Short Tenure (30 days to 90 days)
- Fixed Returns
- Not linked to market fluctuations
- Competitive Yields
Primary Risks
- Credit Risk (Ability of the borrower to repay)
- Liquidity risk (Ability to liquidate before maturity)
2. FD
Fixed Deposits are often considered the most secure investment choice. They can invest a specific amount for a set duration and receive assured returns upon maturity. Indians outside the country can open their FD account with a bank or a NBFC. However, the limitation is that investors can only withdraw their funds after maturity.
3. Mutual Fund
A mutual fund is an investment where a certified fund manager supervises the capital gathered from numerous investors who share a common objective. This pooled capital is invested in various assets such as equities, bonds, money market instruments, or other types of securities. Investment in Mutual Funds is facilitated through NRO or NRE accounts. Returns vary based on fund types (debt, equity, or hybrid) and investment durations. Mutual funds are an effective method to expand one’s portfolio, but profits are only realised when one stays invested in the particular fund for a significant time. Therefore, if you’re looking for higher returns in a much shorter tenure, consider investing in altBlu and altWings.
Why Invest in India?
If one lives in London looking for investment opportunities, one can invest in prominent asset classes like equity, mutual funds, and fixed-income investments like FDs and bonds. However, India has many choices if one is already invested in these and looking for better investment options to diversify their portfolio. The five new invoice discounting products by altGraaf will provide the most promising returns.
Who can invest in altGraaf?
- All individuals residing in India
- Individuals residing outside India who have an NRE/NRO account
Final Words
India is in its golden period with total FDI inflows at $971.521 Bn for FY 2023-24. Investing across geographies can help one diversify their portfolio and earn maximum returns with proper risk mitigation. The World Bank stated, “Over the past decade, the country’s integration into the global economy has been accompanied by economic growth. India has now emerged as a global player.” Various investment options have the growth potential to offer returns that beat inflation. However, it is advised to thoroughly analyse all investment avenues before investing in them.
Frequently Asked Questions
- Who can open an NRE/NRO account?
For Indians living abroad, there are two account options for managing their money in India:
- NRE (Non-Resident External) Account: This account allows you to hold funds earned outside India in either foreign currency or Indian rupees. With NRE accounts, you can freely transfer the money back to your country of residence whenever needed.
- NRO (Non-Resident Ordinary) Account: This account holds Indian rupees only. However, a key factor is that once money is deposited into an NRO account, you cannot transfer it back to your country of residence.
Investing with altGraaf requires using funds held in an NRO account.
- I am an Indian living in London. Can I invest in the invoice discounting products offered by altGraaf?
All Indian residents living in and outside the country can invest in invoice discounting. Please note that if you reside outside India, you must have an NRO account before you invest in altGraaf.
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