To guarantee a fixed rate of interest to savers over the medium term. Floating rate bond investors are not entirely safeguarded against inflation.

Suitable for conservative investors looking for guaranteed profits on a one-time investment.
Not suitable for investors who are willing to take some risk in exchange for higher returns from equity-linked investments.
Alternatives include (1) balanced mutual funds  (2) bank fixed deposits and (iii) company deposits.

Your investment in floating rate bonds is completely safe. However, there is no inflation protection, thus the deposit receives no actual profits anytime inflation exceeds the current interest rate. When inflation is lower than the current interest rate, it is possible to achieve a positive real rate of return.

The current interest rate on floating-rate bonds is 7.15% for a seven-year term.

These bonds are not listed or traded, therefore they cannot be used to secure loans. You are effectively locked in for a seven-year contract. Premature encashment is permitted with a penalty for elderly citizens after a minimum lock-in time that ranges from four to six years according on the senior citizen's age category.
The lock-in period is six years for someone between the ages of 60 and 70. It is five years if the investor is between the ages of 70 and 80, and four years if he is over the age of 80.