For instance if you want to make a purchase of 50,000 then a fixed deposit of 55,556, you will save 1,687 in 12 months. By comparison, but instead if you buy through a credit card and pay in EMIs, ICICI Bank will charge 13 per cent for a year and 15 per cent for 18-24 months on reducing balance.

Also if one is unable to repay on time, then a penalty is charged. If you have the cash, the easiest route to such purchases is breaking the fixed deposit, though there will be a penalty of 50-100 bps.

"It is useful if you have been saving for a specific goal, but want to make a purchase for which you don't have sufficient cash. This way, you don't have to break the fixed deposit you have earmarked," Sadagopan said.

This facility is like an overdraft that now many banks offer against fixed deposits, though in the overdraft case, you have to pay regularly; else, the interest will add up.

According to Sadagopan the EMI on debit card scores due to convenience. In case of overdraft, banks extend 80-90 per cent against the fixed deposit amount and charge one-two per cent more than the fixed deposit rate.