This post covers SBI Recurring Deposit Interest Rates, features, maturity amount along with other details. Recurring Deposit is a good way to accumulate money for any goal in safe and consistent manner. You deposit a fixed amount every month and at the end of it – on maturity you get your principal and accumulated interest.
SBI Recurring Deposit Interest Rates has been last revised on 8th January 2021. General Public can get 3.90% – 5.40% while senior citizens get 4.40% – 6.20% depending on the tenure of deposit. The table below gives the details.
The table below shows SBI Recurring Deposit Interest Rates & the maturity value for Rs 1,000 monthly deposit for general public and senior citizens for 1 to 10 years.
The interest on SBI Recurring Deposit is compounded quarterly and is computed using the formula below.
M=R[(1+i) (n-1)]/1-(1+i)(-1/3))
Where, M = Maturity value
R = Monthly Instalment [60 for Post office RD]
N = number of quarters (tenure) [20 for Post office RD]
i = Rate of interest/400
SBI Recurring Deposit suits someone with consistent regular income (like salary) and would like to accumulate certain amount for a goal without taking much investment risk. An example could be if you want to buy car in next 2 years, you can easily open a RD account with any leading bank and start saving. If you deposit Rs 5,000 every month for 2 years at 7%, you would get about Rs 1,29,000 at maturity. This would be good for downpayment of the car.
It’s also for someone who may not have lump sum amount available for fixed deposit but would like to lock prevailing higher interest rate for long period of time. An example situation is – In March 2013 SBI was offering 9% interest rate on their recurring deposits for 10 years. I had opened a RD with Rs 5,000 just to lock a high interest rate for 10 years. On maturity I would get about Rs 9.7 lakhs – which is good accumulated amount. As of today SBI is offering 5.4%. So I have a good investment. It’s always good idea to lock when interest rate cycle reverses and it goes high.
Whenever a depositor fails to pay the instalment on due date for three consecutive months a service charge of Rs 10/- is applicable. Penalty in case of delay in payment of instalment of RD of 5 years or less shall be Rs 1.50 for every Rs 100 per month and Rs 2.00 for every Rs. 100 per month for the account on more than 5 years. For example, if you deposited Rs 1,000 every month in SBI RD for less than 5 years maturity – If you miss payment for 1 month, you will need to deposit that instalment next month with Rs 15 as penalty (1.5 * 1000/100). If the same RD was for more than 5 years tenure, your fine would be Rs 20.
In case there is no instalment payment for six consecutive months, the SBI recurring deposit account would be closed and the available balance would be paid back to the linked account.
Everyone hates paying taxes and always are on lookout for Options to Save Tax. However…
Are you worried and confused about Lien amount in SBI? Well you are not alone.…
Get details of latest Sovereign Gold Bond Price, Issue details, taxation and how to invest.…
Download the Excel based Income Tax Calculator India for FY 2020-21 (AY 2021-22). This compares…
Piramal Capital & Housing Finance, has come out with Piramal Capital & Housing Finance Ltd…
IIFL Home Loan, the Housing Finance company from IIFL Group has come out with IIFL…
View Comments
Plz tell me that why the my rd not deducted this month ?
Please contact your branch or customer care.
Hi sir,
I want to invest 1,000 every month for two years. Pls suggest me the best.
Choose which ever bank offers highest interest rate for your duration - here is comparison of RD interest across major banks in India
Hi sir,
I want to invest 10,000 every month for two years. Pls suggest me the best.
Here is comparison of interest rates on recurring deposit across all major banks in India.
what is best plan for child education, pl suggest . i can save 4000 per year
Hello sir. Can anybody replies me pls.
And please let me know the calculation also if possible
Sir i am paying Rs.5000 every month in sbi for one year. What amnt will i get after one year. pls suggest me
Assuming you invested at 8% interest rate, you would get Rs 62,648 on maturity. Of this Rs 60,000 is the principal amount and Rs 2,648 would be interest earned.
Hi sir, as per my calculation it is 4800/- and your calculation is 2648/-. How it is pls let me know.
If you deposit Rs 5000 for 1 year at 8%, you get Rs 400 as interest. In case of 1 year RD, you deposit 1st installment for 12 months, 2nd installment for 11 months and so on. So you cannot get Rs 4800!
Hello Sir,
Can you please suggest to me monthly account or fixed deposit, which is best sir, i have only 20,000 present... but this amount belongs to my child, tell me which is the best....
I have compared the recurring deposit interest rates across all major banks in India. The FD rates are also in this range. You can have a look and decide for yourself.
dear sir,
i want to invest 2000 rs. but should i invest in rd or Mutual fund
@Ashish this information is not enough for suggesting where to invest. It depends on your risk bearing capacity, duration of investment among other things.
I would like to invest 6000/- per month for a period of 3years.which will be better for me..rd or mutual fund??? Please suggest.
It depends on your risk profile and tax bracket. Debt Mutual funds are risky but more suited for higher tax bracket else go for recurring deposit.
Sir I'm going to fix deposite of Rs 200000 lac for 5 years. then what amount I'll get on maturity time. pls tell
A fixed deposit of Rs 2 lakhs for 5 years at annual interest of 7% would give you Rs 2.8 lakhs at maturity.