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.
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can anyone tell me the procedure to withdraw the amount from an E-RD on maturity. is it necessary to go to the bank in person for that ?
No the amount on maturity would be directly credited to your linked account
Hi amit ,
I have couple of queries stated as below
1.For PPF after maturity post 15 yrs can I extend it ? I read i can extend it for next 5 yrs and then again for 5 yrs.So is there any definite tenure and any limitations?
2.For SIP Do I need to specify the tenure at the begining of Investment.Like for RD i Have to specify the tenure. If Yes then what are the available option for duration (e.g- 5yrs ,10 yrs etc) and if no then how long Can I continue investing (i.e max duration any limits ?)
3.For SIP Whats the Locking period? Can I discontinue at any moment?
4.In SIP can I skip the investment for 1 or 2 months in between and then again continue if there is any financial crisis.
@ Sanmoy
1. Yes you can extend PPF any number of times in the block of 5 years after completion of 15 years maturity period. You can read more about the same here.
2. For SIP in Mutual Fund there is no maximum duration limit. However most SIP atleast need to have minimum 3 to 6 months payments.
3. Yes you can discontinue SIP at any moment by giving request to the concerned Mutual Fund.
4. Yes you can skip 1 or 2 installments in SIP and continue again in most of the cases.
Hi Amit,
RD for ten years is a taxable income?
yes any Recurring Deposit on any tenure is taxable as of today's tax laws! You never know what would be tax laws after 10 years though :)
have any scheme that deposit Rs.1000 per month for 66 months make one lack rupees
Getting Rs 1 lakh by depositing Rs 1,000 per month for 66 months, you need annual return of 14.25%. The only way to achieve such returns is doing SIP in a good equity mutual fund. But before you make any investment know the associated risks!
Hi Amit i have nri income because i am working in overseas and planning ti invest rs 52000 pm in sbi rd plan for 120 months is i have to pay tax on the income which i invested in rd plan and on the interest. Please reply
You only need to pay tax on income arising in India. In your case its the interest you earn here. So you would need to pay tax only on interest earned on RD.
Hello,
I just opened an SBI e-RD. The date that the account was created was 23rd May 2014 and closing date is 23 May 2015. However, I could not get any information about the due date for payment of each installment. It would be great if you could help me out with this.
Thanks
Debo
When You are opening SBI e-RD account, the bank automatically asks you to schedule the payment from the related savings bank account. You might have done it. If not just look into the details in your e-RD account
I am interested to open a RD Account for Rs.500 for Every Month for the tenure of 2 years . Which bank will be safe for me ? UCO or SBI Bank ? Please Suggest me.
You can invest in either - both are Government owned banks and hence carry zero risk!
my age is 25 and annual income is 300000. what plan i choose to get more 5000000 at the age 45.
what is good opening a RD account with big amount for a short period of time or with a small amount for a longer period. please tell me in term of return which i get
I am married with one daughter, working in railway under NPS. My net income is 36000. My savings plan is as under...
LIC Jivan Anand(18 yr) = yearly prm. Rs.19687.
LIC Jivan saral(22 yr)= yearly prm Rs.36030.
PPF=Rs.25000 yearly.
NEW PENSION cutting=Rs.2757 monthly.
My monthly expense is Rs.20000. I have spare money about Rs. 5000 p.m. For which i can take moderate risk.
Please suggest about my financial planning what i have done..and what extra i should do. My age is 37.
Good Plan Ya