What is a Recurring Deposit (RD)?

A Recurring Deposit is a special type of term deposit offered by Indian banks which help people with regular incomes to deposit a fixed amount every month into their RD account and earn interest at the rate applicable to Fixed Deposits.

RD Interest Calculation Formula

The interest on an RD is compounded quarterly in most Indian banks. The formula used for calculating the maturity value is:

M = R [(1+i)^n - 1] / [1 - (1+i)^(-1/3)]

Where:
M = Maturity Value | R = Monthly Installment | n = Number of Quarters | i = Interest Rate / 400.