SBI Recurring Deposit (RD) Vs Post Office Recurring Deposit (RD)

A recurring deposit (RD) account is a special kind of term deposit offered by banks. RDs help people with regular incomes deposit a fixed amount every month into their accounts. The interest rates on RDs are similar to that on fixed deposits (FDs). The difference between the two is that FDs require customers to lock a particular amount until a given maturity period while RDs require customers to make regular contributions. The minimum period of an RD is six months and the maximum is 10 years.
State Bank of India (SBI), the largest lender of the country, and the Department of Posts or India Post, both offer recurring deposit options to customers. Given below is a comparison of RD accounts offered by SBI and India Post:

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Recurring deposit (RD) accounts offered by SBI:

Key features of SBI recurring deposit scheme:
1. Customers have to make monthly deposits of minimum Rs 100 and in multiples of Rs 10 said SBI on its website, sbi.co.in. There is no limit on the maximum amount that one would like to deposit.

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2. The minimum period of an SBI RD is 12 months while the maximum is 120 months.

3. The interest rate offered on SBI RDs is as applicable on its TDR (term or fixed deposits) / STDR (special term deposits) for the period of the RD.

4. A loan / overdraft up to 90 per cent is available against the balance in an RD account.

5. RDs also invite TDS or tax deducted at source.

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6. Premature withdrawal is allowed on RDs and for this, rules for TDR/STDR are applicable.

7. A nomination facility is available on RDs and it is advised to avail of the facility, said SBI.

8. SBI issues passbooks for RD accounts.

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Terms and conditions of SBI recurring deposit accounts:
1. Penalty charges for non-deposit of monthly instalments are as follows:

2. For account of period 5 years and less --Rs. 1.50 per Rs. 100 per month is applicable.

3. For account of period above 5 years- Rs. 2.00 per Rs. 100- per month is applicable.

4. Instructions for disposal of maturity proceeds are accepted at the time of opening of accounts, said SBI.

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Interest rate on SBI recurring deposit accounts:

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SBI revised interest rates on fixed deposits with effect from March 28, 2018. As mentioned above, the interest rates on RDs are the same as that on FDs.

Here are the interest rates on retail domestic term or fixed deposits 'Below Rupees One Crore':

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(All figures in % per annum)