Recurring Deposit(RD) is a special type of deposit account which enables a depositor particularly in fixed income group to save by paying into the account an agreed fixed sum of money monthly over a stipulated period. The deposits in this type of account earn compound interest on quarterly basis. Longer the period for which monthly deposits are agreed to be made higher is the rate of interest subject to rules.
Formula To Calculate RD Interest :
R [ (1+i)n – 1]
M = ——————–
1- (1+i) -1/3
M = Maturity value
R = Monthly installment
n = Number of quarters
i = Rate of interest/400
What is Recurring Deposit (RD) ?
Recurring Deposits are a special kind of Term Deposits offered by banks in India which help people with regular incomes to deposit a fixed amount every month into their RD [Read More]