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Flexi Recurring Deposit

Flexi RD - Top Banks

Last Updated 29th Jul 2021

  • Investment under Flexi RD is generally made in an initial core amount and monthly instalments.
  • Flexi Recurring Deposit is an investment scheme that comes with the flexibility of selecting monthly instalment amount and in return, generates handsome returns.
  • Account-holders can make additional deposits in a month above the core deposit.
  • Most leading banks offer Flexi RDs, which includes SBI, ICICI, PNB and Bank of India, among others.
  • Flexi RD offers loan facility, overdraft facility and nomination facility.
  • No late payment penalty is levied on the variable monthly deposit in a Flexi RD.
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What is a Flexi Recurring Deposit?

Flexi RD is a flexible term deposit that banks offer for the convenience of depositors. Here, you can invest any amount as and when available and avail lucrative returns at the time of maturity. You are required to deposit a core amount while opening the Flexi RD account and set a variable amount that must be paid on the predetermined date every month to avoid penalty. The respective banks set the minimum and maximum caps for deposit under a Flexi RD. Flexi RD account holders can change the monthly instalment amount based on the funds available, and no late payment penalty is charged on this additional deposit. Banks generally have a wide range of deposit tenures available for such deposits, and they decide the interest rate according to the chosen tenure.

Banks offering Flexi Recurring Deposit Schemes

If you are planning to invest in a Flexi RD, you must compare your options first. Below goes the list of banks offering Flexi Recurring Deposit.

Bank Interest Rate Minimum Investment Amount
ICICI Bank 3.50% to 5.50% Rs. 500
SBI 5.00% to 5.40% Rs. 100
PNB 4.40% to 5.30% Rs. 100
Bank of India 6.25% to 6.70% Rs. 500
Central Bank Of India 6.20% to 7.00% Rs. 100
IndusInd Bank 7.25% to 8.00% Rs. 500
Indian Bank 3.95% to 5.25% Rs. 25
Karur Vyasya Bank 6.75% to 7.00% Rs. 100

ICICI Bank Flexi RD

This deposit offers lucrative interest rates ranging from 3.50% to 5.50% with tenures ranging from 12 months to 120 months. Along with no compulsory monthly deposits, ICICI Flexi RD also allows customers to make multiple deposits in one month. No pre-closure penalty is charged for breaking the iWish Flexi RD deposit before maturity.

State Bank of India Flexi RD

SBI Flexi deposit interest rates range between 5.00% to 5.40% The interest is compounded quarterly with a minimum deposit of ₹ 0 Cr. The maximum limits, however, is up to ₹ 50,000. You can invest in the SBI Flexi RD for a tenure ranging from 5 to 7 years with the flexibility of choosing the amount to be paid and the number of deposits to be made every year.

Punjab National Bank Flexi RD

With a nominal minimum deposit of ₹ 6, you can invest under this scheme for a tenure ranging from 6 months to 120 months. PNB offers a general interest rate of 4.40% to 5.30%, while the interest rates for senior citizens range from 4.90% to 5.80%. PNB Flexi RD account holders are not charged any penalty for late payments or premature closure of the account. Furthermore, this Flexi RD offers loan and overdraft facility.

Bank of India Flexi RD

Bank of India offers an interest ranging from 6.25% to 6.70% with a minimum deposit of Rs. 500. The tenure can be anywhere between 6 months to 120 months. This deposit allows you to make flexible instalments and also avail the nomination facility.

Central Bank of India Flexi RD

The interest rates of Flexi RDs offered by the Central Bank of India range from 6.20% to 7.00%. This deposit can be made with any amount ranging from Rs. 100 with the option to step up or step down the monthly instalment. The deposit tenure can start from 6 months during which account holders can make additional fund deposits besides monthly deposits.

IndusInd Bank Flexi RD

This term deposit can be opened with a minimum deposit of Rs. 500. Customers can enjoy full flexibility regarding monthly instalments. The interest offered on this deposit ranges from 7.25% to 8.00 with an available deposit tenure between 12 months to 120 months.

Indian Bank Flexi RD

This term deposit can be opened with a minimum deposit of Rs. 25. Customers can enjoy full flexibility regarding monthly instalments. The interest offered on this deposit ranges from 3.95% to 5.25% with an available deposit tenure between 6 months to 120 months.

Karur Vysya Bank Flexi RD

This deposit allows customers to choose the core amount that shall be paid in a single instalment. You can deposit any amount from Rs. 100 to a maximum of ₹ 2 Lakh and make multiple monthly deposits. The interest rate starts at 6.75% and goes up to 7.00%. No penalty is charged by this bank for delay in payment.

Features and Benefits of Flexible RD

As the name suggests, Flexi RD is offered to help customers avail flexibility in deposit while making long-term investments. Such deposits come with a number of beneficial features as listed below.

  • Flexible monthly instalments : Flexi RD requires an initial core amount deposit, but variable amounts for monthly instalment can be set according to the funds available at that time. The additional deposit can be made in specific multiples of the core amount.
  • Upper deposit limit : The maximum deposit amount is mostly fixed by banks which cannot be exceeded while making deposits during the RD tenure. For example, SBI Flexi rd doesn't allow you to above ₹ 50,000 in a year.
  • Variable interest rates : The rate of interest applicable to the core amount is calculated as per the deposit tenure, while interest on the flexible deposit is applicable from the date of deposit. Interest rates on Flexi RD vary from one bank to another with most banks offering higher interest to senior citizens. For instance, BOI offers an interest of up to % while ICICI Flexi RD offers up to %.
  • Flexible deposit tenure : Customers can choose the tenure of deposit, considering his financial goals. However, banks state a range of available deposit tenures from which you have to choose a suitable period.
  • Loan facility available : You can get a loan against your recurring deposit balance. Since the recurring deposit acts as the collateral, interest rates are lower and loans are easily approved.
  • No Pre-closure charges : Most banks do not charge any penalty for closing Flexi RD before maturity. Some banks levy a nominal pre-closure charge.

How Flexi Recurring Deposits differ from Normal Recurring Deposits?

Normal recurring deposit is a term deposit in which you need to make fixed monthly instalments for a certain period of time. Flexi RD, on the other hand, allows customers to choose the number of monthly instalments according to their convenience.

The core amount deposited while opening the Flexi RD has to be paid on the predetermined date every month. However, in Flexi deposit, you can choose to make additional deposits up to a specific amount above the core amount, which is not allowed in normal RDs.

Late payment penalty is only levied on the core amount and not on the variable amount in Flexi deposit, while in a normal RD, the penalty is charged on the entire monthly instalment. The interest rate, however, is the same for both deposits.

FAQs

What is flexible RD?

Flexible RD is a term deposit with the flexibility to invest any lump sum according to the convenience and availability of funds of the investor. You can choose the amount of monthly instalment and the tenure for which you want to stay invested. Under the flexible RD scheme, you will receive attractive returns on your deposit at the end of the tenure.

Who can open a Flexi Recurring Deposit?

Any resident individual willing to invest in a term deposit can open a Flexi recurring deposit. Such individuals also include senior citizens who are mostly offered preferential interest rates. Many banks also allow minors to open a Flexi recurring deposit. Federal Bank offers Flexi recurring deposits to Non-resident Indians exclusively.

How can I withdraw money from Flexi Recurring Deposit?

Most banks don't allow partial withdrawal from Flexi Recurring Deposit before the end of the deposit tenure. You can withdraw your money at the time of maturity of the RD. However, Corporate Bank allows you to withdraw up to 50% of the balance in Flexi recurring deposits at the end of the first year and second year.

Is TDS applicable on Flexi Recurring Deposits?

In Flexi Recurring Deposit, no TDS will be deducted for those submitting self-declaration forms stating that their income is below the taxable limit. For avoiding TDS on Flexi Recurring Deposit, you need to submit the 15G form if your age is below 60 years and 15H form if you are a senior citizen, that is, above 60 years of age.


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