Recurring Deposit
In banking terminology, the term recurring deposit refers to the periodic placement of a fixed sum of funds with a bank or financial institution into a special term account, with a specified tenure, generally between one and five years. At the end of the tenure, the funds are typically withdrawn by the depositor with accrued interest.
FEATURES & BENEFITS :-
The Recurring deposit account is an account in the bank where an investor deposits a fixed amount of money every month for a fixed tenure.
Recurring deposit account is opened by those who want to save regularly for a certain period of time and earn a higher interest rate.
Recurring deposit scheme is meant for investors who want to deposit a fixed amount every month, in order to get a lump sum after some years.
Quarterly interest will be credited to depositor’s Bank account, if opted.
TERMS & CONDITIONS:-
The minimum investment amount in recurring deposit Rs. 100/- more investment. Interest calculation compound Quarterly.
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Frequently Asked Questions
Recurring Deposit is a special kind of Term Deposit offered by Grama Consumer Cooperative Society in which help people with regular incomes to deposit a fixed amount every month into their Recurring Deposit account and earn interest at the rate applicable to Fixed Deposits.
- Customers can avail loans against FDs up to 80 to 90 percent of the value of deposits. The rate of interest on the loan could be 1 to 2 percent over the rate offered on the deposit.
- Residents of India can open these accounts for a minimum of 3 months.
Tax is deducted by the banks on FDs if interest paid to a customer at any bank exceeds Rs. 10,000 in a financial year. This is applicable to both interest payable or reinvested per customer. This is called Tax deducted at Source and is presently fixed at 10% of the interest.