Zerodha Launches Fixed Deposits on Coin Platform

Zerodha has announced the introduction of fixed deposits (FDs) on its Coin platform, allowing users to invest in FD options from multiple partner banks and monitor their investments through a single dashboard. Essentially, Zerodha is functioning as a distributor for FD offerings from partner banks, including Suryoday Small Finance Bank, Utkarsh Small Finance Bank, and Unity Small Finance Bank. In these partnerships, platforms typically receive backend commissions from banks for attracting deposits, and users incur no fees, maintaining the competitive edge of Zerodha’s longstanding zero-cost model for retail investors.

Analysts observe that FD distribution generates minimal commissions and will not significantly drive primary revenue. Instead, this move seems aimed at capturing a greater portion of user savings, particularly from risk-averse investors.

Addressing Key User Challenges

“By incorporating FDs into Coin, Zerodha tackles a major issue: fragmentation,” the analyst mentioned. Users commonly have deposits spread across different banks, complicating tracking efforts. A unified interface enhances user convenience and keeps them engaged within the platform.

Improving User Retention and Engagement

Importantly, this strategy may bolster user retention and engagement. With options for equities, mutual funds, and FDs all in one place, Zerodha solidifies its position as a comprehensive platform, widening the potential for cross-selling higher-margin products such as trading and derivatives.

Overall, while the integration of FD distribution may provide some incremental commission income, Zerodha’s broader goal lies in strengthening user relationships, enhancing wallet share, and promoting long-term platform loyalty rather than seeking immediate revenue growth.

Zerodha launched Coin in April 2017 as a direct mutual fund platform, which has now grown into a more extensive investment solution. Additionally, in FY25, Zerodha reported an 11.5% decline in consolidated revenue year-on-year, totalling Rs 8,847 crore, while profits reached Rs 4,237 crore during the same time frame.