Recurring Deposit Interest Rates in Post Office

Nowadays, everyone wants to invest their money in a recognized to get excellent and high recurring deposit interest rates in the post office for their investments. However, most people prefer investing through the post office as RD Interest rates in the post office are good. It attracts many people due to its eye-catching feature of post office RD interest rate.

However, the RD interest rates post office fluctuate yearly, it doesn’t remain the same. Currently, the RD interest rate post office is around 5.8%, which is applicable quarterly. In this article, we will discuss the recurring deposit interest rates in post offices, the calculation of post office RD interest rates, etc.

Overview of Recurring Deposit Interest Rates in Post Office

The table below contains information about recurring deposit interest rates in a post office

Post office Rd interest rate5.8% p.a.
Missed deposit penalty1 INR for every 100 INR
Minimum deposit100 INR per month
Maximum depositNo maximum limits
TenureFive years

What are the Recurring Deposits?

Many people need to gain more knowledge about what a recurring deposit is. So here we are to help you. Regular deposits are a type of investment in which you do not have to meet the requirements according to the bank. You can deposit the money according to your convenience. Moreover, it provides a high return on the maturity of the policy. It is a great way to save money for small financial needs. Additionally, the RD interest rates in post offices are comparatively low compared to any bank.

How to Calculate Post Office RD Returns?

The maturity amount accrued at the end of 60 months for a person with an investment of Rs. 6,000 PORD at the rate of 7.2% p.a. would be Rs. 4,33,883. It is calculated based on formula A= P x (1+R/N) ^ (Nt) where :

A= Maturity Amount

P= Recurring deposit

N= Number of times the interest is compounded

R= Rate of interest

T= Tenure

Features of Recurring Deposit Interest Rates in Post Office

Here are some of the standard features of RD interest rates post office are:

  1. The insured can start their RD Interest rates in a post office account with just 1 INR, and there is no such maximum limit for the deposit into the account.
  2. A rebate benefit is provided to the insured if they are likely to pay the RD interest rate in the post office immediately.
  3. Even the facility of joint accounts is provided in post offices. Two people can mutually run a single account.
  4. According to the recent reforms, the RD interest rate in the post office is 5.8% which should be paid every quarter.
  5. The minimum tenure of recurring deposit interest in the post office is around five years.
  6. Even options are provided for transferring one post office account to another region’s post office.

Components in the Recurring Deposit Interest Rates in Post Office

Here are some components of Rd’s interest in the post office

1. Tenure  

The tenure of the post office RD is fixed at 5 years, and individuals often open accounts for medium-term investment purposes to have immediate support in case of emergencies.

2. Min. and Max. Deposit

 To accommodate individuals who have concerns about the deposit amount and interest rates, the minimum deposit for a recurring deposit is set at a low value, making it affordable and striking to a wide range of investors.

3. Deposit Date

During the 5-year tenure of a post office RD, a total of 60 deposits are required, with the first deposit made at the time of account opening. Subsequent monthly deposits must be made on or before a specific date based on the account’s opening date.

4. Penalties

Account holders of a post office RD are permitted a maximum of 4 defaults. However, if the 5th monthly payment is not made, the account becomes inactive or discontinued. Fortunately, these discontinued accounts can be revived within a period of 2 months from the 5th default.

Who is Eligible for Opening an RD Account?

Some requirements are provided for recurring deposit interest rates in the post office. However, if you want to open an RD account, you must stand on the specific eligibility criteria provided by the post office.

  • The insured must be a citizen of India.
  • The insured must be above the age of 18 years.
  • Another person can also open an account on behalf of their loved ones.
  • If you’re a minor, you can also mutually open an account with your elders or guardians.
  • You cannot open an account individually if you didn’t have crossed the age of 18.

Documents Required to Open an RD Account

  • To open an RD account, you need to fill out a post office account-opening form and provide two passport-sized photographs.
  • Additionally, you must submit address and identity proof documents such as Aadhaar, passport, PAN card, or other acceptable forms mentioned in the Income Tax Act, 1961.
  • You will also be required to provide identity proof for verification purposes during the account opening process.
  • Finally, you need to select a nominee and obtain the signature of a witness to complete the necessary formalities.

Also Read: How Many Types of Loans in Bank

Conclusion

Recurring deposit interest rates in the post office are one of the most popular and efficient ways to save your money, and at last, you will be provided with good maturity benefits. If you’re a teenager and want to save money, recurring deposit interest rates in the post office can be the best way for you. Moreover, the RD interest rates post office are meager and can quickly be paid for by anyone. In this article, we have discussed all the essential details of recurring deposit interest rates in the post office, their eligibility, features of RD interest rates post office, etc.

Recurring Deposit Interest Rates in Post Office – FAQs

What are the rules for RD in the post office?

Ans. According to the regulations mentioned for recurring deposit interest rates in the post office, it is believed that the minimum term for a plan is five years, and you have to make deposits every quarter.

Can we close the post office RD before maturity?

Ans. Yes, you can close the post office RD before maturity. However, you will not be provided with the total amount of the plan. As you’ll get only 50% of the maturity amount.

What are the benefits of RD in the post office?

Ans. Post offices are one of the most ancient and famous money-saving sources. It has been providing its services for years and gained much trust from people. The RD interest rates post office are pretty good, and one can easily bear them for fulfilling their financial needs. recurring deposit interest rates in post office attracts people for small investments.

Can RD be withdrawn at any time?

Ans. RD is different from a saving account. However, you cannot withdraw your money like a saving account. However, you’ll only be provided half of the maturity value if you want to remove it.

What is the penalty for breaking RD?

Ans. The penalty for breaking RD is paying 1% – 2% of accrued post office rd interest rate.

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