Bond investing: 5 online platforms where you can easily open online account and invest in bonds

A good number of bonds are providing high yields. That’s the reason a lot of investors who are lookin for attractive but rlatively safer investmnt options are exploring to invest in these bonds. Many investment platforms provide such investors with an opportunity to invest in bonds offered by government, corporate and other entities. Here, we take you through five prominent bond platforms where you can invest in a variety of bonds.

Paisabazaar

Paisabazaar has recently opened its platform for investing in bonds. The minimum investment is Rs 1,000, and the platform claims to provide up to 13.50% return on bond investments.


How to invest in bonds through Paisabazaar

You need to complete the Know Your Customer (KYC) process and link your bank and demat accounts. Once onboarded, you can explore bond offerings and compare coupon rates, credit ratings, yields, maturity periods and other key features investment details. You can select a bond that aligns with your financial goal and complete the transaction online.

IndiaBonds

The minimum investment amount ranges on the bond selling platform from Rs 10,000 to Rs 10 lakh depending on product type and underlying bonds.

How to invest in bonds through IndiaBonds

1.Login/sign up

Login /sign up to IndiaBonds

2. Select a bond

Select a Bond according to your preference

3. KYC (paperless)

Complete online KYC, it takes less than 3 mins

4. Online payment

Make direct payment to Clearing Corporation

Jiraaf

The bond platform claims to have more than 2 lakh users and Rs 2,000-plus investments. You can invest in invest in corporate bonds, securitised debt instruments (SDIs) and high-yield fixed deposits (FDs) on Jiraaf. The minimum investment is Rs 10,000.

How to buy bonds on Jiraaf

Step 1: Fill in the basic details

Click Continue to proceed.

Step 2: ID Verification

PAN Verification (keep a soft or physical copy of your PAN card handy).

For the physical copy, capture the front side of your PAN card. When capturing the PAN card, hold it in your hand, slightly below your chin, for a clear view, or simply upload the soft copy from your device.

Review the PAN card details again before proceeding to the next step.

Aadhaar Verification

You’ll be redirected to the Digilocker page.

Enter your Aadhaar number, captcha, and the OTP received on your Aadhar-linked mobile number. Then click Allow to share details.

Step 3: Add additional details

Provide information like marital status, father/spouse’s name, and the occupation type.

Step 4: Bank account details

Add your bank account details and click Continue. Verify the details via UPI or direct bank account information.

Step 5: Demat Account Details

Enter your Demat account details as prompted.

Step 6: Identity Confirmation

Allow camera and location access on your device for photo verification

Stay still until the circle turns green, then capture your photo

Next, digitally sign by following the instructions provided

Step 7: Final Steps

Review your KYC form and confirm all details

Generate the final document, enter your Aadhaar number, and wait for the OTP

Once you enter the OTP, your KYC submission is complete

Grip Invest

Founded in 2020, the bond purchasing platform claims to have 5 lakh-plus investor community. The company says that it has enabled Rs 5,420 crores of investments. You can invest in corporate bonds, SDIs and corporate fixed deposits through the Grip Invest investment.

How to invest in bonds through Grip Invest

Register on Grip using only their mobile number and email ID

View all available Bonds available for investment

Complete the one-time KYC process to begin investing

Select a Bond based on investment objective and risk appetite, and place the order digitally

Funds are instantly transferred to the NSE Clearing Account via UPI or Net Banking

Bonds are credited to the customer’s Demat account on a T+1 days basis

Interest/ principal payouts are credited to the customer’s bank account

Bondbazaar

Bondbazaar claims to have a bouquet of 8,000-plus bonds on its online platform. It says that customers do not incur any brokerages, account opening costs or other such charges on Bondbazaar.

How to invest in bonds through Bondbazaar

Create an Account: Sign up on Bondbazaar without any charges, no account opening, brokerage, or maintenance fees.

Complete KYC: Submit your KYC documents digitally for smooth verification.

Link Your Demat and Bank Account: Bonds are held in demat form, and all interest and principal payments are credited directly to your bank account.

Browse and Select Bonds: Choose from government bonds, corporate bonds, and other categories based on your investment goals.

Place an Order: Buy bonds with a few clicks on a real-time trading platform.

Monitor and Sell Anytime: You can also sell bonds easily on the platform anytime you want, providing liquidity and flexibility.

How bonds work

Bonds can be government, corporate, municipal, junk bonds, etc.

In a bond, the investor lends money to an entity such as the government or a corporate. They, in return of that investment, usually get regular payments from the bond issuer. At the end of the maturity period, the investor gets their principal back with final interest.

High-interest bond and the risk

Santosh Agarwal, CEO, Paisabazaar, told ET Wealth Online Investors should note that bonds with lower credit ratings usually offer higher yield to maturity (YTM) and vice versa. Thus, make sure that you invest in a bond after carefully assessing the bond issuer’s credit rating, financials, coupon rate, the frequency of coupon payment and not solely based on their returns.

Repo rate impacts bond rates

The increase in the repo rate usually causes the bond prices to fall and the yields to increase. When new bonds offer higher yields than the existing fixed-rate bonds with similar risk profiles, the prices of existing bonds generally fall to make their returns more competitive, says Agarwal. Low-rated or long-duration bonds tend to be more sensitive to such changes and may see larger price fluctuations.

Impact on debt mutual funds when bond rates fall

Since debt mutual funds also invest in bonds, a change in bond price impact debt returns.

In the current scenario, debt mutual fund investors and existing bond investors should not rush to sell their holdings simply because the prices have declined. They should continue holding their investments as doing so may help them avoid losses arising from interim price fluctuations, provided the issuer fulfils its obligations.

What new bond investors can do

New investors can consider staggering investments across different maturities and evaluate bonds on the basis of credit quality, yield and risk rather than chasing higher returns, advises Agawal. Debt mutual fund investors should also choose funds aligned with their financial goals and investment horizon instead of making decisions solely in response to repo rate changes.