RD Calculator
Calculate Recurring Deposit maturity amount, total interest earned, and effective annual yield for any monthly deposit. Supports quarterly, monthly, half-yearly, annual, and simple interest compounding.
Calculator
Maturity Amount
₹ —
Total Invested
₹ —
Interest Earned
₹ —
Maturity Amount
—
How RD Calculator Works
What is a Recurring Deposit?
A Recurring Deposit (RD) is a savings scheme offered by Indian banks and the Post Office that lets you deposit a fixed amount every month for a chosen tenure. At maturity, you receive your total deposits plus the interest earned — making it one of the most accessible ways to build a corpus through disciplined monthly savings.
Unlike a Fixed Deposit which requires a lump sum, an RD lets you start with as little as ₹100 per month. Banks typically offer RD tenures from 6 months to 10 years, with quarterly compounding as the standard method for calculating interest.
RD Interest Formula
Indian banks use quarterly compounding for RDs. The maturity amount is calculated using the annuity formula applied to monthly instalments:
re = (1 + r/4)1/3 − 1 (effective monthly rate from quarterly compounding)
A = P × [(1 + re)t − 1] / re
Where P is the monthly deposit, r is the annual rate as a decimal (rate ÷ 100), re is the effective monthly rate, and t is the tenure in months.
For simple interest RDs (used by some rural banks and certain Post Office schemes):
I = P × (r/12) × t × (t + 1) / 2
Worked Example
₹5,000/month for 12 months at 7% p.a., quarterly compounding:
- r = 7 ÷ 100 = 0.07
- re = (1 + 0.07/4)1/3 − 1 ≈ 0.5800% per month
- A = 5,000 × [(1.00580)12 − 1] / 0.00580
- A ≈ ₹61,945
- Total invested = ₹5,000 × 12 = ₹60,000
- Interest earned = ₹1,945
- Effective Annual Rate (EAR) ≈ 7.19%
RD vs FD — Key Differences
| Feature | Recurring Deposit (RD) | Fixed Deposit (FD) |
|---|---|---|
| Investment Type | Monthly instalments | One-time lump sum |
| Minimum Amount | ₹100/month | ₹1,000 (varies) |
| Flexibility | Regular savings habit | Requires upfront capital |
| Returns | Slightly lower (staggered deposits) | Higher (full amount earns from day 1) |
| Best For | Salaried savers, goal-based savings | Lump sum parking, short-term goals |
Both RD and FD are low-risk, capital-guaranteed savings instruments. Use an RD if you have a regular income and want to save monthly. Use an FD if you have a lump sum to invest. For the same-money, same-rate mathematics behind this choice, read the full FD vs RD comparison.
RD Interest Rates in India (2026)
| Bank | General (1–3 years) | Senior Citizen |
|---|---|---|
| SBI | 6.5% – 7.0% | 7.0% – 7.5% |
| HDFC Bank | 6.6% – 7.25% | 7.1% – 7.75% |
| ICICI Bank | 6.7% – 7.2% | 7.2% – 7.7% |
| Post Office RD | 6.7% (5-year fixed) | Same |
| Small Finance Banks | Up to 8.5%+ | Up to 9.0%+ |
RD rates closely track FD rates. Senior citizens typically receive an extra 0.25%–0.5% on both instruments. Rates are revised periodically by the RBI’s repo rate decisions.
TDS on RD Interest
Interest earned on RDs is taxable as “Income from Other Sources” at your income tax slab rate. Banks deduct TDS at 10% when aggregate interest income from a single bank (across all FDs and RDs) exceeds ₹40,000 in a financial year (₹50,000 for senior citizens). Submit Form 15G (or Form 15H for senior citizens) to avoid TDS if your income is below the taxable limit.
RD vs SIP — Which is Better?
An RD delivers guaranteed returns (currently 6.5–7.5% p.a.) with zero market risk, making it ideal for short-term goals and emergency funds. A Systematic Investment Plan (SIP) in an equity mutual fund can deliver 10–15% p.a. over the long term but carries market volatility. Use RDs for money you need within 1–3 years; use SIPs for goals 5+ years away where you can ride out market cycles. Use the SIP Calculator to compare.
Accuracy & Sources
Last reviewed: July 2026. Formula source: Annuity formula with effective monthly rate — standard for Indian bank RDs. All calculations run in your browser. No data is sent to any server.
Frequently Asked Questions
Most Indian banks calculate RD interest using quarterly compounding applied to each monthly instalment. The formula derives an effective monthly rate: r_e = (1 + r/4)^(1/3) − 1. The total maturity is then: A = P × [(1 + r_e)^t − 1] / r_e, where P is the monthly deposit and t is the tenure in months. Use the calculator above for instant results at any rate and tenure.
At 7% p.a. with quarterly compounding, ₹5,000/month for 12 months gives a maturity of approximately ₹61,945. Total invested: ₹60,000. Interest earned: ₹1,945. Effective Annual Rate: 7.19%. The interest is lower than an equivalent FD because RD deposits are staggered — the last instalment earns interest for only 1 month, unlike an FD where the full amount earns from day one.
The Effective Annual Rate (EAR) is the true annual return after accounting for compounding. For a 7% RD compounded quarterly, the EAR is (1 + 0.07/4)^4 − 1 = 7.19%. For a simple interest RD, the EAR equals the nominal rate (7%). The higher the compounding frequency, the higher the EAR relative to the stated rate.
Yes. RD interest is fully taxable as 'Income from Other Sources' at your income tax slab rate. Banks deduct TDS at 10% when combined interest income from all RDs and FDs at a single bank exceeds ₹40,000 per year (₹50,000 for senior citizens). If your total income is below the taxable limit, submit Form 15G (Form 15H for senior citizens) to your bank at the start of the financial year to avoid TDS deduction.
Most Indian banks offer RD tenures from 6 months to 10 years. The Post Office Recurring Deposit has a fixed 5-year tenure. Some banks allow shorter tenures of 3 months for special schemes. This calculator supports tenures from 1 month to 10 years (120 months) to accommodate all Indian bank and Post Office RD options.
An RD (Recurring Deposit) accepts monthly instalments — ideal if you save from a monthly salary. An FD (Fixed Deposit) accepts a one-time lump sum — ideal if you have surplus funds to park. FD returns are higher than RD at the same interest rate because the full principal earns interest from the first day, whereas in RD, each instalment earns only for its remaining tenure. Both are capital-guaranteed instruments with similar interest rates.
Use RD for guaranteed, risk-free returns (6.5–7.5%) on short-term goals or an emergency fund. Use SIP (Systematic Investment Plan) in equity mutual funds for long-term wealth creation: equity SIPs historically return 10–15% annually over 10+ years, but carry market risk. A balanced approach: park 3–6 months of expenses in RD as a liquid emergency fund, and route your long-term monthly savings into SIPs for superior growth potential. Use the SIP Calculator to compare projected returns.