The post office has announced updated interest rates for the Recurring Deposit (RD) scheme. Effective from January 1, 2024, the new interest rate is set at 6.7% per annum, compounded quarterly.

Account requirements and limits

  • Minimum Deposit: Rs 100 per month, in multiples of Rs 10
  • Maximum Balance: No upper limit

Eligibility for opening an account:

  • A single adult
  • Joint Account (up to 3 adults)
  • A guardian on behalf of a minor or a person of unsound mind
  • A minor above 10 years in their own name

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Note: Multiple accounts can be opened by a single individual.

Deposits:

  • Accounts can be opened with cash or cheque (date of deposit considered as cheque clearance date)
  • 2. Minimum monthly deposit is Rs 100, in multiples of Rs 10
  •  For accounts opened by the 15th of a month, deposits must be made by the 15th of each subsequent month
  • 4. For accounts opened after the 15th, deposits are due by the last working day of each month

Defaults:

  •  A default charge of Rs 1 per Rs 100 denomination applies for each missed month
  • To continue the account, missed payments and default charges must be paid first
  • After four consecutive defaults, the account becomes discontinued and must be revived within two months, or no further deposits can be made

Advance deposits:

  • Deposits can be made in advance for up to 5 years if the account is active
  •  Rebates are available for advance deposits of at least 6 months

Loan facility:

  • Loans up to 50% of the balance are available after 12 installments and one year of account continuation
  • Loan interest rate is 2% above the RD interest rate
  • Loans must be repaid before maturity or will be deducted from the maturity value.

Premature closure:

  • Accounts can be closed after 3 years with the applicable savings account interest rate if closed prematurely.
  •  No premature closure is allowed if advance deposits have been made.

Maturity:

  • The RD account matures in 5 years (60 monthly deposits).
  • Accounts can be extended for another 5 years with the original interest rate.
  • Extended accounts can be closed anytime, with interest calculated based on the completed period.

Death of account holder:

  • Nominees or legal heirs can claim the balance by submitting an application at the post office.
  • The account can be continued until maturity by the nominee or legal heirs after claim sanction.

These updates ensure more flexibility and benefits for account holders, enhancing the overall value of the RD scheme.

How much will be the your return if you will invest Rs 5,000 or Rs 10,000 every month? 

If you invest 5,000 every month your maturity value in 5 years will be Rs 3,54,957. Similarly, if you invest 10,000 every month your maturity value in 5 years will be Rs 7,09,902.