Tata motors, the country's biggest automotive company in terms of revenue has mobilized Rs.264 crore through a revised Fixed deposit scheme that it introduced in August this year. The company is authorized to raise Rs. 1,300 crore from the scheme.

The rate at which the market has responded to the revised scheme has reduced considerably when compared to the previous scheme when the company managed to raise funds worth Rs. 2,700 crore in nine months.

The huge amount collected previous year was because of higher interest rate (11 percent) offered by the scheme. The rates have now been reduced by 325 basis points to 8.75 percent for a period of three years.

The company raised an average of Rs. 300 crore per month in the previous FD scheme at a time when FD schemes from other companies were not doing very well. According to the annual report of the company, it had introduced the scheme to meet its funding requirements.

A Tata Motors spokesperson said: "Tata Motors had introduced a fixed deposit scheme, under which we could raise about Rs 2,700 crore. We did raise that amount. On the date of the annual general meeting (AGM) this year (August 25, 2009), we renewed our FD scheme. The company is now authorised to raise about Rs 4,000 crore. Since August 25, Tata Motors has raised about Rs 264 crore."

Market experts say that Tata scheme was introduced at a time when liquidity in the market was very low and people preferred to save money. Since the scheme offered an interest rate higher than most bank FD schemes it received a good response from depositors.

The revised rate applicable to Tata motor scheme is still higher than various banks like ICICI, HDFC and SBI.