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The latest cut in deposit rates by Mahindra Finance has made its fixed deposit unattractive, believe financial planners. The AAA-rated NBFC has cut deposit rates by a sharp 100 basis points, making it the highest cut in recent times. Investors will now earn 5.7% for one year, 6.2% and 6.3% for two and three-year deposits and only 6.45% for a five-year deposit. As compared to this, the post office pays 5.5% for 1-3 year deposits and 6.7% for a five-year deposit, making it a better space to park money for a five-year term.“The sharp cut in deposit rates has made many corporate fixed deposits unattractive. Investors need to review their portfolios,” says Mohit Mittal, Product Head (Investments), Bajaj Capital. As an alternative to fixed deposit, he recommends the GOI bonds which pay interest rates of 35 basis points higher than the post office national savings certificate (NSC) to investors in low tax bracket, with the interest rate being reset every six months. Currently, GOI bonds pay an interest of 7.1%.