I recommend to invest in Liquid Mutual Fund (Direct plans) as current 10 year Govt Bond yield is low at 6.7%.  I believe that the bond yield will increase over the next 1-2 years. Switch to Debt Gilt Mutual Fund (Direct Plan) when the bond yield increases to 8-8.5%. One can easily get 6-7% return which is higher than the current FDs returns.

Debt (Liquid) Mutual Fund - Direct Plans

Large Cap

(Investment in the largest 100 stocks)​

Mutual Fund

Expense Ratio

1 Yr

3 Yrs

Franklin India Liquid Fund

Mahindra Liquid Fund

Edelweiss Liquid Fund

BNP Paribas Liquid Fund

Nippon India Liquid Fund

0.12%

0.12%

0.09%

0.07%

0.18%

7.1%

7.0%

6.9%

6.9%

6.9%

7.1%

7.1%

7.0%

7.0%

7.0%