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Recurring Deposit (RD)

Recurring Deposit (RD) is a simple savings option where you invest a fixed amount every month and earn guaranteed interest over a chosen tenure. It’s ideal for building disciplined saving habits with assured returns.

What is RD?

Recurring Deposit (RD) is a type of savings scheme offered by banks and post offices where you deposit a fixed amount every month for a chosen period (usually 1 years to 10 years). At the end of the tenure, you get back the total deposited amount plus interest, which is compounded quarterly.

It is considered a safe and low-risk investment option with guaranteed returns, making it suitable for people who want to build savings gradually instead of investing a lump sum.

Benefits of RD

1. Guaranteed Returns

Your investment is safe as RD offers fixed interest rates and assured maturity value, unaffected by market risks.

2. Disciplined Savings Habit

Since you deposit a fixed amount monthly, it helps you build consistent saving habits over time.

3. Flexible Tenure

Choose a tenure ranging from 1 years to 10 years based on your financial goals and convenience.

4. Low Monthly Investment

You can start an RD with as little as ₹100 per month, making it accessible for everyone.

5. Loan Facility Against RD

Banks allow you to avail loans or overdrafts against your RD balance in case of emergencies.

6. Open to Everyone

From students to salaried individuals, anyone can open an RD and grow their savings gradually.

FAQs

Q1. Can I change my monthly deposit amount later?

No, the chosen amount stays fixed for the entire tenure.

Q2. Is RD better than FD?

RD is for monthly savers, FD is for lump sum investment.

Q3. Can minors open an RD?

Yes, with a guardian’s consent.

Q4. Is the RD amount safe?

Yes, it is risk-free and regulated by banks/post offices.
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