Highest RD Rates for 2020 by Different Banks
|Bank Name||Interest Rate||Tenure|
|Jana Small Finance Bank||8.50%||2 year|
|Utkarsh Small Finance Bank||9.00%||2 year 1 day to 3 year|
|Fincare Small Finance Bank||9.00%||456 days to less than 2 years|
|Suryoday Small Finance Bank||8.75%||Above 2 years to 3 years|
|Ujjivan Small Finance Bank||8.30%||799 days|
|ESAF Small Finance Bank||8.25%||365 to 545 days|
|IDFC First Bank||8%||1 year|
|Equitas Small Finance Bank||8.30%||30 months|
|RBL Bank||7.65%||2 year to less than 3 year|
|DCB Bank||8%||3 year|
|IndusInd Bank||7.50%||1 year|
|Axis Bank||7.00%-7.60%||9 months-10 Years|
|Kotak Bank||6.50%-7.30%||1 year-10 years|
|HDFC Bank||6.25%-7.40%||6 months-120 months|
|ICICI Bank||6.25%-7.50%||6 months-10 years|
|SBI Recurring Deposit||6.25%-6.40%||1 year-10 year|
|CitiBank||6.00%-7.50%||365 Days-1095 Days|
|IDBI Bank||6.00%-7.05%||1 Year – 20 years|
|Indian Overseas Bank||5.75%-6.80%||180 days-10 years|
|Allahabad Bank||6.50%-6.75%||180 days - 10 years|
|Bank of India||6.25%-6.70%||180 days – 10 years|
|Canara Bank||6.20%-7.00%||180 days - 10 years|
|Central Bank of India||6.20% - 7.00%||180 days - 10 years|
|Punjab and Sind Bank||6.25% - 7.00%||180 Days - 10 years|
|Bank of Maharashtra||6.00% - 6.60%||6 months - 10 years|
|UCO Bank||6.70% - 6.75%||1 year - 10 years|
|Yes Bank||7.00% - 7.25%||6 months- 10 years|
|Syndicate Bank||6.50% - 6.80%||1 year - 10 years|
|Union Bank of India||6.50% - 6.85%||180 days - 10 years|
|South Indian Bank||6.50%- 7.60%||1 year - 10 years|
|Bandhan Bank||6.40% - 7.55%||6 months - 10 years|
|Corporation Bank||6.50% - 6.80%||1 year - 10 years|
|Karur Vysya Bank||6.75% - 7.00%||180 days - 10 years|
|PNB||6.25%- 6.75%||180 days - 10 years|
|DHFL Bank||8.00%||1 year - 10 year|
|DBS Bank||5.75% - 7.50%||180 days - 10 years|
|Lakshmi Vilas Bank||6.50% - 6.85%||180 days - 10 years|
|Central Bank of India||6.20% - 7.00%||180 days-10 years|
|Andhra Bank||6.26% -6.80%||6 months - 10 years|
|Indian Bank||6.00% - 6.75%||180 Days- 10 years|
What is Recurring Deposit?
For Indians, Recurring Deposit is considered as the most popular investment scheme. It is an investment option offered by Banks and Financial Institutions in India. This is considered as the low-risk option offering higher returns than savings account coupled with flexible tenure choices.
Individuals who do not wish to invest large sum of money but still wish to earn guaranteed return, can opt for Recurring Deposits. At the end of the scheme, user will receive a sum of their deposit along with payable interest as predetermined by the bank.
How is interest on RD Calculated Online?
Most Banks compound the RD interest on a quarterly basis. The RD Interest calculation is done basis the following formula:
Where M, R, n, and I stands for
R= Monthly Installment
n= Number of Quarters
I = Rate of Interest/400
A user can calculate the applicable interest and the maturity that they can procure from a Recurring Deposit Scheme online by visiting the respective Bank’s website. Bank’s have the online calculator that a user can use for doing the accurate interest calculation.
Steps to use the RD Calculator
The user interface of RD Calculator at most sites of the Bank are designed for the easy accessibility of the user.
Below are the steps to navigate through the calculation process.
- Key in the monthly deposit amount, interest rate and tenure.
- Once all figures are in place, click on the button which will reflect the maturity amount.
- Within fraction of seconds, the exact calculation will be displayed to the user.
Features and Benefits of Recurring Deposit Scheme
Recurring deposit schemes generally are more flexible schemes as compared to Fixed Deposit Schemes, which is highly preferred by citizens to save money for hay days. They can choose the tenure and monthly payment according to their convenience. Shared below are the features of the scheme which individuals can benefit from.
- The interest rate of the scheme is determined annually.
- The compounding of the scheme is done quarterly and not annually as is generally perceived.
- The deposit is done monthly by the user.
- Tenure of the RD scheme is in multiples of 3 months.
- A loan of up to 80-90% on your RD amount can be availed by pledging it as security deposit.
- Minors are also allowed to open RD accounts to inculcate the habit of saving. However, this should be done under the supervision and guardianship of parents.
- The rate of interest for senior citizens under RD scheme is usually 0.5% more.
- Premature withdrawals attract only a small amount as penalty.
- The tenure can be chosen from 7 days to 10 years. It is at complete convenience of the user to select the tenure suiting their need.
- The minimum deposit amount for RD can be as low as Rs.10. It allows to save money on a regular basis and reap benefits later.
Who can invest in Recurring Deposits?
Indian residents and Hindu Undivided Families are eligible to open a Recurring Deposit with their bank. Minors under the guidance and supervision of their guardians also can open recurring deposit accounts.
Recurring deposit will be the best bet for those who cannot opt for investing higher amount and willing to put their foot forward in a low-risk investment option. The returns earned are higher with regular deposits in Recurring Deposit schemes.
What are the factors affecting RD Interest Rates?
Various factors play a role in determining the interest rate to be offered to the applicant. Below we will be discussing those factors.
Banks and Financial Institutions
It would be wise to invest in Recurring Deposit schemes with Bank’s and NBFCs as they are the safest. This majorly affects the interest rate which an individual is offered and the maturity amount one may get.
Interest rate on Recurring Deposit depends on tenure. Tenure is the duration for which the money is deposited.
Age of the applicant
The interest rate of Senior Citizens on Recurring Deposits is higher than rest of the individuals. The minimum age criteria of senior citizens may vary as per the provider.
Current Economic Environment
As the economic scenario changes, the interest rate varies according to it. Change in repo rate by the RBI, inflation and so on.
Income Tax on Recurring Deposits
Investing in RD also qualifies for taxation like FD. The tax is levied@ 10% p.a and it is deducted at source i.e TDS, if the deposit amounts to more than Rs.10,000. Interest earned on RD is taxable and not on the full maturity amount.
Individuals who do not account for taxable income must submit Form 15G/15H or Exemption Certificate under Section 197 or any other applicable Tax Exemption Certificate with the bank to avoid TDS on RD.
This tax exemption certificate or form should be submitted every financial year for each Recurring Deposit Held with the bank.
How does Afinoz RD Calculator Works?
Afinoz RD Calculator is very simple and convenient to use. Just key in the Deposit Amount, Rate of Interest, and Deposit Tenure and within the blink of an eye, the accurate calculation will be displayed to the user.
It will help the user make an informed decision on how much amount he/she should invest monthly and how much will be the maturity amount.
Q) What is the minimum and maximum tenure, an individual can opt for to open a RD account?
Ans) For RD account, the minimum tenure starts at 6 months and may extend up to a period of 10 years.
Q) Does Interest earn on Recurring Deposit scheme accounts for TDS deduction?
Ans) As per Income Tax Law the TDs levied will be at the rate of 10% if the deposit amounts to more than Rs.10,000.
Q) Can an individual begin with investing small amounts in RD?
Ans) The minimum investment amount varies from bank to bank and can be as low as Rs 10.