Types of Post Office Recurring Deposit Scheme | Post Office Recurring Deposit Interest Rates | PO (Dak Khana) RD Revised Rate
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Post Office Recurring Deposit Interest Rates
- The India Post Office offers RD interest rates as high as 5.80%.
- Quarterly interest is compounded on RDs with India Post Office.
- The India Post Office accepts deposits as low as 100 rupees.
- The India Post Office gives older citizens an RD rate of up to 5.80%.
Special Features of Post Office Recurring Deposit Interest Rates
- The account can be started with cash or a check, and there is also a nomination option.
- After three years from the date of starting the RD account, it is possible to close it early.
- If the RD account is prematurely closed, interest will be paid at the rate applicable to the Post Office Savings Account at the time of the untimely closure.
- The maturity date will be 5 years after the date of opening.
- The account can be extended for another 5 years if necessary.
- After one year, one loan of up to 50% of the balance is permitted.
- The term of the deposit varies from 5 to 5 years.
- To use this service, go to any India Post Office branch.
- TDS deductions are subject to existing income tax standards, with 1 rupee levied for every 100 rupees at the time of opening the RD account.
Types of Recurring Deposit Schemes at the Indian Post Office
India Post Office Recurring Deposits are categorized into three types based on their tenure:
- Short-Term RD
The duration of your deposit with this form of India Post Office Recurring Deposit spans from 6 months to 3 years. This type of RD is ideal for folks who want to create a saving habit
- Medium-Term RD
When you don’t want to commit for a long period of time and aren’t sure how much advantage you’ll get from RD, a medium-term recurring deposit is a smart choice. It strikes the appropriate blend of flexibility and investment commitment, allowing you to weigh the pros and cons. The tenure usually lasts between three and seven years.
- Long-Term RD
When you want to make a return on your investment but don’t have the funds to invest in a fixed deposit, a long-term RD is the ideal option. By investing in recurring deposits, you gain the flexibility of making monthly investments while earning a return comparable to a fixed-income investment. The tenure usually lasts between seven and ten years.
RD Account at the India Post Office
Customers of the India Post Office can put their surplus funds in a recurring deposit account for a set length of time. During account opening, a customer needs to make a deposit into their RD account. During the term of the deposit, the customer makes periodic deposits and withdraws any money in the account.
PO RD Rates Governing Factors
Post Office Recurring Deposit Interest Rates are influenced by a variety of factors. The following are some of them:
- The interest rate of all banking instruments, including recurring deposits, is affected by changes in the Cash Reserve Ratio (CRR) and repo rate as instructed by the RBI.
- Recession – During a recession, the RBI releases cash into the market, thereby infusing liquidity. Banks decrease RD rates as a result of abundant liquidity and low loan demand.
- Inflation – Inflation has a beneficial influence on the interest rate on a fixed deposit. As a result, in periods of growing inflation, RD rates tend to be higher.
- Current Economic Situation – When the economy is growing, people take out more credit to suit their personal and corporate needs. Banks offer higher interest rates during periods of high credit demand in order to attract additional cash through recurring deposits.
India Post Office RD Interest Calculator
The amount of RD maturity you will receive is determined by the following three factors.
- Deposit amount: The initial sum deposited by a customer in the India Post Office is called the deposit amount. On larger deposits, a higher interest rate may be offered. The India Post Office accepts deposits of up to 100 rupees.
- Interest Rates- The India Post Office pays a higher interest rate on longer-term recurring deposits and a lower interest rate on shorter-term deposits. The highest deposit interest rate offered by India Post Office is 5.80 percent.
- Deposit period- The bank offers a low interest rate on short-term RDs and a higher interest rate on long-term RDs.
Recurring Deposits with India Post Office: How Long Do They Last?
With India Post Office, you can open a Recurring Deposit account for a minimum of 5 years and up to a maximum of 5 years.
Post Office Recurring Deposit Withdrawal before Due date
It is possible to withdraw an RD early from India Post Office Bank. According to their banking policies, India Post Office Bank may levy a minimal penalty.
There will be a charge of 1 rupee for every 100 rupees.
Partially withdrawing funds from an RD account is not permitted.
Post Office Recurring Deposit Penalty on Payment Failure
If you pay beyond the due date, the bank may allow you a grace period of a few days. If you fail to pay your installment by the due date, India Post Office Bank will impose a penalty in accordance with their policies.
There will be a charge of 1 rupee for every 100 rupees.
Residents of India and HUFs (Hindu Undivided Families) are eligible to open an RD account. NRIs can open RD accounts using their NRO and NRE accounts.
Banks also offer an RD plan for children who are under the financial supervision of their parents.
A Post Office RD in India can be opened for a minimum of 5 years and a maximum of 5 years.
When your RD account matures, you can request that the bank transfer the principal amount as well as the collected interest component to your linked savings account. After the RD matures, you can put the money into fixed deposits.
www.indiapost.gov.in is the official Website of India Post.