Recurring Deposit account also called RD. RD is a unique plan to Deposit fixed monthly investments for a Fixed Term. Let’s discuss what is a Recurring Deposit account and Features and benefits of RD.

What is a Recurring Deposit account (RD)?

RD stands for Recurring Deposit. RD scheme is popular among middle-class families to earn a decent interest rate.

Recurring Deposit account is primarily available in all banks of India and Post offices as well. RD tenure ranges from 6 months to 10 years, and investors can select any term according to their needs.

RD is a small savings plan every month that allows investors to get decent interest at the end of RD tenure.

What is a RD Account

Features and Benefits of Recurring Deposit account

  1. Interest rate:- RD & FD have the same interest rate. Therefore banks pay higher interest as compared to savings accounts.
  2. Minimum investment:- Banks offer different minimum investment plans to the users. They can choose small investments as low as 100 rupees.
  3. Investment Term:- Minimum plan of RD is 6 months, and the maximum is 10 years
  4. Withdrawal:- Customers are not allowed to withdraw money in the mid-range of RD. If the customer still wants to withdraw cash, then the bank can impose a penalty on him.
  5. Loan:- Loan facility is available on RD.
  6. Additional interest rate:- Senior Citizens can get a different interest rate compared to others.
  7. No Limitations:- Single user can open multiple RD

Interest Rate on RDAccount for General Citizens and Senior Citizens from Top Banks of India

Bank’s NameInterest Rates for General CitizensInterest Rates for Senior Citizens
SBI – RD Interest Rates 4.40% – 5.50%4.90% – 6.20%
HDFC Bank – RD Interest Rates 4.40% – 5.50%3.50% – 5.50%
ICICI Bank – RD Interest Rates 3.50% – 5.50%4.90% – 6.25%
PNB – RD Interest Rates4.40% – 5.30%4.90% – 6.90%
BOB – RD Interest Rates4.30% – 5.25%4.80% – 5.75%
IDFC First Bank – RD Interest Rates6.75% – 7.25%6.75% – 7.25%
IDBI Bank – RD Interest Rates7.00% – 7.15%7.50% – 7.50%
AXIS Bank – RD Interest Rates4.40% – 5.75%4.65% – 6.50%
Indian Bank – RD Interest Rates6.25% – 6.30%6.75% – 6.80%
Indian Overseas Bank – RD Interest Rates4.90% – 5.20%5.40% – 5.75%
Canara Bank RD Interest Rates 4.45% – 5.85%4.95% – 5.75%
Kotak Bank – RD Interest Rates4.30% – 5.20%4.80% – 5.70%
Bandhan Bank – RD Interest Rates 4.50% – 5.25%5.25% – 5.74%
Post Office – RD Interest Rates5.80% – 5.80%5.80% – 5.80%

FAQ (Frequently Asked Questions)

1. Full Form of RD Account

Ans:- Recurring Deposit Account

2. What are the benefits of an RD account?

Ans:- Below are the benefits of RD account:

  1. The main benefit of an RD account is that banks pay higher interest rates.
  2. Start with a low amount as 100 monthly bases.
  3. Save slowly slowly
  4. Easy documentation
  5. Best for short term

3. Can I withdraw money from recurring Deposits?

Ans:- Premature withdrawal is not allowed. Even then you would like to withdraw money then the bank will penalize you.

4. Is RD (Recurring Deposit)Risky?

Ans:- RD is a fully risk-free investment with an assured good return.

5. Is Recurring Deposit Safe?

Ans:- In RD, your funds are safe and secure. At the end of RD tenure, you will get a higher interest rate. The interest rate in RD same as the interest rate in FD.