Mutual fund FMP though not having guaranteed returns enjoy a long term capital gains tax if above 3 yrs. Whereas the Income from Bank FD itself is not guaranteed due to the contingencies like NPA (Non Performing Assets).
According to me,
People should change their mindset and believe in new financial products for their investments. Today due to the rise of NBFC (Non Banking Financial Corporations), new investment products are in demand. On account of easier mobility of the funds accross the globe. Thus facilitating global investments for higher returns which may be riskier than that of conventional banking.