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SBI RD Interest Rates 2020

SBI RD Rate of Interest, 2020

Last Updated 25th Nov 2020

Tenure General Rates Senior Citizen Rates
1 year to 1 year 364 days 5.50% 6.00%
2 years to 2 years 364 days 5.50% 6.00%
3 years to 4 years 364 days 5.70% 6.20%
5 years to 10 years 5.70% 6.50%
    SBI RD Calculator
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    SBI Recurring Deposit

    • SBI offers RD interest rates up to 5.70%
    • Interest on RD with SBI is compounded quarterly.
    • SBI accepts minimum deposits starting at 100.
    • For senior citizens SBI offers RD rate upto 6.50%.
    SBI RD Rates - Special Features
    • Nomination facility is available
    • loan facility is available up to 90% of your RD amount
    • The deposit tenure ranges from 1 year to 10 years
    • Visit any SBI branch to avail this service
    • TDS deductions are subject to the existing income tax rules as at the time of opening the RD account

    SBI Recurring Deposit Schemes Types

    Based on the tenure SBI Recurring Deposit can be classified into three types, these are:

    Short-Term RD

     

    Under this type of SBI Recurring Deposit your deposit’s tenure ranges between 6 months to 3 years. Such RD is best suited for those who are looking to develop the habit of savings. 

    Medium-Term RD

    When you are not willing to commit for the long tenure and are not sure how much benefit you can get from RD, then opting for medium term recurring deposit is a good decision. It provides the right balance of flexibility and commitment to invest  so that you can assess its benefits. The tenure basically ranges between 3 years to 7 years. 

    Long-Term RD

    The long term RD is best suited when you want to earn the return on your investment but do not have the lump sum amount to invest in fixed deposit. By investing recurring deposits you get the flexibility of making monthly investments, and earn the return similar to FD. The tenure basically ranges between 7 years to 10 years.

    SBI RD Account

    SBI offers recurring deposit option to their customers to park their periodically generated surplus savings for a fixed tenure. A customer is required to make a deposit once into their RD account at the time of opening the account with the bank. The customer then makes periodic deposits and withdraws any money in the account during the tenure of the deposit.

    Regular RD

    • Nomination facility is available
    • Loan facility is available up to 90 percent of your RD amount
    • The minimum tenure of this RD is 1 year
    • The minimum deposit to be made in this account is 100

    Holiday Saving RD

    • Turn your holiday dream into a reality, by using your RD to finance your holiday trip through Thomas Cook
    • Option to choose a holiday package from Thomas Cook
    • The cost of the chosen package is divided by 13; the 13th installment is paid by Thomas Cook
    • Option to change the maturity instructions and move the funds to your linked Savings Account
    • The minimum tenure of this RD is 1 year
    • The minimum deposit to be made in this account is 100

    SBI Recurring Deposit Rates

    There are some factors that affect SBI Recurring Deposit interest rates. These are as follows:

    • Policies Framed by RBI : The change in Cash Reserve Ratio (CRR) and repo rate as directed by the RBI affect the interest rate of all banking instruments including the recurring deposit.
    • Recession – In times of recession, RBI releases funds in the market and hence injecting liquidity in the market. As a result of high liquidity and low credit demand, banks reduce the rates on RD.
    • Inflation – Inflation has a positive effect on a fixed deposit interest rate. Hence, RD rates tend to be higher in a period of rising inflation.
    • Current State of Economy – In a booming economy, people take larger credit to meet their personal and business requirements. In periods of high credit demand, banks offer higher interest rate to garner more funds through recurring deposits.

    SBI RD Interest Calculator

    RD maturity amount that you will get depends on the following three parameters

    • Deposit amount – This is the initial amount deposited by a customer in SBI. Higher interest rate might be offered on larger deposits. SBI offers deposit amount starting at 100.
    • Rate of Interest- SBI offers a higher rate of interest on recurring deposits of longer tenure and lower interest rate on deposits held for a shorter period. Highest interest rate offered by SBI is 5.70% for deposit amount.
    • Period of deposit- Bank offers low interest rate for short tenure RDs and higher interest rate for long tenure RDs.

    Duration of Recurring Deposits with SBI

    You can open a Recurring Deposit account with SBI for a minimum tenure of 1 year which can go up to maximum tenure of 10 years.

    Premature withdrawal of RD with SBI

    Premature withdrawal of RD with SBI Bank is allowed. SBI Bank may charge a nominal amount of penalty as per their banking norms.
    However, Partial withdrawal of RD account is not allowed.

    Penalty for delayed installment of RD with SBI

    Bank may give you grace of some days if you delay the payment beyond the due date. In case you do not pay your installment after due date, SBI Bank will charge a penalty as per their norms.

    Illustration: Mr. A opens a RD account for tenure of 1 year with periodic deposits of ₹ 5,000 per month at an interest rate of 5.70%. In this case, the maturity amount at the end of 1 year will be ₹ 61,876 and includes the collected principal and total interest earned on the principal amount during the period at ₹ 1,876. Similarly, you can calculate the interest and maturity amount for higher tenures by using RD calculator.

    FAQs

    What is the eligibility for opening an RD account?

    Indian residents and HUF (Hindu Undivided Families) can open RD account. NRIs can also open the RD account through NRO and NRE accounts.
    Banks provide RD scheme for minors as well, under the guardianship of parents to supervise their finances.

    What is the general tenure/duration of SBI Recurring Deposits?

    SBI RD can be opened for minimum 1 year to maximum tenure of 10 years.

    Is premature withdrawal allowed in RD accounts?

    The amount can only be withdrawn on maturity. In case of emergency you can break your RD before maturity, but after that your account will be closed. Banks may deduct 1 or 2 percent penalty from the interest accrued on your RD amount for the period for which the amount was with the bank.
    The minimum lock in period is 3 months and if the depositor request a premature withdrawal before that, he earns zero interest and only the principal amount will be refunded to him. Apart from cancelled interest, any incentives offered are also withdrawn.

    Is partial withdrawal of RD accounts allowed by SBI?

    Partial withdrawal of recurring deposit is not allowed by SBI. However, some banks offer the facility to obtain Loan or Overdraft by keeping your RD as collateral. On the other hand, premature withdrawals are allowed by post offices if you have an RD account with them for at least a year. The withdrawn amount is considered a loan, which has to be paid in lump sum.
    Premature Closure is allowed, but with some penalty.

    What exactly happens on maturity of RD account?

    On maturity of your RD account, you can ask the bank to transfer the principal amount and the accumulated interest component directly into your linked savings account. You can also invest your RD amount in fixed deposits after maturity.

    Is nomination facility available in SBI RD account?

    Nomination facility is available in SBI recurring deposits. Whether you open it in single name or joint name, only one nominee per account is permissible. You should ensure that the nomination is followed as per RBI rules. You can change the nominee through declaration in appropriate form.


    SBI News - Nov 2020
    • 2020-11-11 : SBI to focus on financial inclusion
      SBI is planning to increase the share of its newly created business vertical, financial inclusion and micro-markets from the current 12% to 20% by March 2022. The bank recently created a separate FI&MM vertical within the bank with an aim of financial inclusion of rural and semi-urban areas to improve customer experience in the hinterland.
    • 2020-11-05 : SBI net profit rises to ₹4,574 crores in Q2
      SBI September quarter net profit jumped 52% year-on-year to Rs 4,574.16 crore as the provisions declined during the quarter. Credit growth for the bank logged an improvement of 6.02% over the previous year driven by home, personal, car, two-wheeler and gold loan along with mudra and business loan. Total advances at the end of Q2 were at Rs 23.83 trillion. Further, total Deposits which includes fixed and recurring deposits grew at 14.4% on a yearly basis to Rs 34.70 trillion, out of which current account deposit grew by 8.55% YoY while saving bank deposits grew by 16.28 per cent YoY.
    • 2020-08-06 : SBI reports Q1FY21 net profit of Rs. 4776.50 crore
      State Bank of India reported a net profit of Rs.4776.50 crores for the period ended June 30, 2020, as against a net profit of Rs.6909.95 crores for the period ended March 31, 2020. The Bank posted a total income of Rs.87984.33 crores backed by retail loans like home, personal, car, two-wheeler, and gold loan along with the business and mudra loans. Further, the bank total deposits which include FD, RD, current and savings account grew at 15.96 per cent YoY.
    • 2020-06-05 : State Bank of India reported the highest ever yearly net profit
      State Bank of India registered a Net Profit of Rs.3581 Crores bolstered by retail business loan, FDs and RDs in Q4FY20, an increase of 327% over Q4FY19. For the full year FY20, Net Profit stood at Rs. 14,488 Cr backed by retail loans like home, personal, gold, two-wheelers, and car loan along with business and mudra loan against Net Profit of Rs 862 Crores in FY19. This is also the highest ever yearly Net Profit recorded by the Bank.
    • 2020-01-20 : SBI revises its recurring deposit rate
      State Bank Of India revised RD rates. Recurring deposit rate for one year to 6 years stands at 6.10%. Further, Rd rates for the senior citizen for the same period is 6.60%. SBI RD can be started with a minimum monthly deposit of just Rs 100. The new revised rates are in effect from 10 January 2020.
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