Post Office Recurring Deposits: With a network of over 1.5 lakh post offices across the country, India Post offers nine types of government-sponsored savings schemes at its designated branches and that includes a five-year recurring deposit (RD) account. Notably, interest rates applicable to all the post office saving schemes are decided on quarterly basis. If you have invested you money in this acount, you should know that for the current quarter, which will end on September 30, 2019, it will give you a return of 7.20 per cent, according to information available on indiapost.gov.in. 

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According to India Post's website, the government has reduced the interest rates applicable on small savings schemes by 10 basis points in the current quarter. Those who are interested in the scheme should know about the post office recurring deposit (RD) scheme given below:

1. Post office RD account

According to the India Post website, interested individuals should know that for opening a five-year recurring deposit account, they need to invest a minimum amount of Rs 10 per month. They can also make monthly deposits in multiples of Rs 5, and depositor can have more than one account in his/her own name, or jointly with another person. Notably, he/she can make subsequent deposit up to 15th day of next month if the account is opened up to 15th of a calendar month. They can also deposit up to the last working day of next month if their account is opened between 16th day and last working day of a calendar month.

They should know that amounts deposited are repayable in lump sum at the end of the period of five years from the date on which they made the first deposit along with interest as prescribed from time to time. 

2. Rules for premature withdrawal of recurring deposit

Those who have deposited their amount with Post Office recurring deposit (RD) are allowed to make one withdrawal up to 50 per cent of the balance after one year. However, this withdrawal should be repaid in lump-sum along with interest at the prescribed rate at any time during the currency of the account, said the website.

3. Late payment charges for RD

Customers should also know that the monthly deposits should be credited on any day of the month, If they fail to pay monthly installment, it may lead to a default and the default fee of five paise is charged for every five rupees. In any RD account, if there is monthly default amount, he/she has to first pay the defaulted monthly deposit with default fee along with the current month deposit.