RD Calculator India 2025-26 — Recurring Deposit Maturity & Interest
A Recurring Deposit (RD) is India’s most popular monthly savings instrument — ideal for salaried individuals who want to build wealth systematically without needing a lump sum. You deposit a fixed amount every month, the bank pays compound interest on your growing balance, and you receive the full maturity amount at the end. Over 10 crore RD accounts are active across Indian banks and Post Offices today.
⚡ RD Quick Reference — FY 2025-26
SBI RD Rate6.50%
Post Office RD (5 yr)6.70% ✓
HDFC / ICICI RD6.80 – 7.10%
Axis Bank RD (3 yr)7.25%
Kotak RD7.40%
Senior Citizen extra+0.25 – 0.50%
TDS threshold (general)₹40,000 / yr
TDS threshold (senior citizen)₹50,000 / yr
DICGC insurance cover₹5 lakh / bank
Minimum instalment₹100 / month
Compounding frequencyQuarterly
Missed instalment penalty₹1.50 – ₹2 per ₹100/mo
Post Office premature closureAfter 3 years only
How RD Interest is Calculated in India
RD uses quarterly compounding applied to each monthly instalment separately. The first instalment earns interest for the full tenure, the second for (tenure minus 1 month), and so on until the last instalment earns interest for just one month.
M = R × [(1+i)^n − 1] / (1 − (1+i)^(−1/3))
M = Maturity · R = Monthly instalment · i = Quarterly rate (annual÷4) · n = Total quarters
This staggered compounding is why RD maturity is always slightly less than an equivalent FD at the same rate — because not all instalments earn for the full term.
RD Rates — Major Indian Banks 2025-26
Bank Rate Comparison
Bank1 yr2 yr3 yr5 yr
SBI6.50%6.80%6.75%6.50%
HDFC Bank6.60%7.00%7.00%7.00%
ICICI Bank6.70%7.00%7.10%7.00%
Axis Bank6.70%7.10%7.25%7.00%
Post Office———6.70% ✓
RD vs FD vs SIP — The Complete Comparison
RD vs FD: If you have a lump sum, FD always gives more interest than RD at the same rate — because the full principal earns compound interest for the entire tenure. At 7% for 1 year, ₹1 lakh in FD earns ₹7,186 while ₹8,333/month in RD (same total) earns only ~₹3,800. Choose RD when you don’t have a lump sum and want to invest monthly from salary.
RD vs SIP: RD at 6.5–7% is guaranteed, zero-risk, and ideal for goals under 3 years. SIP in equity mutual funds targets 12% CAGR but with market risk and negative years. For short-term goals (1–3 years), RD wins. For long-term goals (5+ years), SIP in diversified equity funds historically outperforms RD significantly. Smart approach: RD for emergency fund and short-term goals, SIP for long-term wealth.
Frequently Asked Questions
What is the RD interest rate in India in 2025-26?+
RD rates for 2025-26 range from 6.5% to 7.25% at major banks. SBI offers 6.5% for 1 year, 6.8% for 2 years. HDFC and ICICI offer 7.0–7.1% for 2–3 year tenures. Axis Bank offers up to 7.25% for 3 years. Post Office RD offers 6.7% for the fixed 5-year tenure with complete government backing. Senior citizens get an additional 0.25–0.5% at all banks.
How much will I get if I invest ₹5,000 per month in RD for 5 years at 7%?+
Investing ₹5,000 per month in RD for 5 years at 7% annual interest (quarterly compounding) gives: Total invested ₹3,00,000. Total interest earned approximately ₹57,700. Maturity amount approximately ₹3,57,700. After 30% tax on interest, post-tax maturity is approximately ₹3,42,610. Compare this with SIP in equity funds targeting 12% CAGR: same ₹5,000/month for 5 years could give approximately ₹4,12,000 — but with market risk.
Is RD interest taxable? How much TDS is deducted?+
Yes — RD interest is fully taxable as “Income from Other Sources” at your income slab rate. TDS is deducted at 10% when your total interest from all RDs and FDs at one bank exceeds ₹40,000 per year (₹50,000 for senior citizens). Submit Form 15G (under 60 years, income below ₹3 lakh) or Form 15H (senior citizens) to avoid TDS deduction.
What happens if I miss an RD instalment?+
Missing RD instalments incurs a penalty — typically ₹1.5 to ₹2 per ₹100 per month. SBI charges ₹1.5 per ₹100 per month. HDFC Bank charges ₹2 per ₹100 per month. If you miss 4–6 consecutive instalments, the bank may auto-close your RD at premature rates with penalty. Always set up auto-debit from your savings account for RD instalments.
Post Office RD vs Bank RD — which is better in 2025-26?+
Post Office RD at 6.7% for 5 years comes with sovereign government guarantee — zero credit risk. Bank RDs offer 6.5–7.25% with DICGC insurance only up to ₹5 lakhs. For amounts under ₹5 lakhs: choose the higher-rate bank RD. For amounts above ₹5 lakhs: Post Office RD wins on safety. Key difference: Post Office RD cannot be closed before 3 years, while most bank RDs can be closed anytime with penalty.
Can I open an RD online in India?+
Yes — all major banks allow online RD opening through net banking or mobile apps. SBI: YONO app or net banking. HDFC: NetBanking. ICICI: iMobile or net banking. Axis: Mobile banking app. Post Office RD can be opened at any post office or through India Post Payments Bank app. Online RDs can be set up with auto-debit from your savings account.