Monthly investment

₹

Rate of interest (p.a)

%

Time period

Years

Invested amount | ₹ |

Est. returns | ₹ |

Total value | ₹ |

Total investment

Total interest

Indian Overseas Bank (IOB) is a public sector bank with headquarters in Chennai. The bank ranked 7th in the EASE Reforms for Public Sector Banks 2019 – a joint report prepared by the Boston Consulting Group and Indian Banks’ Association.

Under its term deposit schemes, the bank offers more than 15 products, of which recurring deposits provide worthwhile returns. Depositors can use an IOB RD calculator to ascertain the returns earned from opening such accounts.

The Indian Overseas Bank RD calculator is an online tool that is useful for calculating the maturity value of a recurring deposit based on the invested amount, rate of interest, deposit tenure. It is free to use and shows the results instantly upon entering the values.

An IOB RD scheme can be availed by any individual irrespective of their occupation or income. The minimum amount required to open an RD account is Rs.50.

Read More IOB RD Interest Rates

Interest on a recurring deposit account with IOB is compounded every quarter. Meaning, deposit holders will earn interest every 3rd month from the time of deposit and 4 times in a year.

Individuals holding an RD account can use the IOB RD interest rates calculator to determine their returns. The formula used by this calculator is mentioned below –

**M = R x {(1 + n) x n – 1} / 1- (1 + i) ****(-1/3)**

Here,

- M is the maturity amount.
- n is the number of quarters within the deposit period.
- R is the amount deposited in the RD.
- i is the rate of interest divided by 400 (owing to 4 quarters).

*Consider the following example to understand the formula better:*

*Mr. Amol is aged 54 and resides in Guwahati. He opens an RD account with IOB and deposits Rs.5,000 every month for 4 years. As per the table illustrated above, he will earn a rate of interest of 6.80%.*

Here,

- n = 16 (4 years x 4).
- R = Rs.5,000.
- i = 0.017 (6.80 / 400).

Now, when placed in the formula –

M = 5,000 x {(1 + 16) x 16 – 1} / 1- (1 + 0.017) (-1/3)

Hence, M = Rs.276,418.

So, Mr. Amol will receive Rs.2,76,418 when he invests Rs.5,000 every month for 4 years at a rate of interest of 6.80%.

If Mr. Amol was a senior citizen, his maturity amount would have been Rs.2,79,431 as per an applicable rate of interest of 7.30%.

As manual calculations can be subject to errors and can be time-consuming, individuals can use an IOB Recurring Deposit calculator to know their RD maturity amount**.**

Some of the factors that influence the rate of interest on an IOB RD are –

**Deposit tenure**

The primary factor that affects RD interest rates is the deposit tenure or maturity period. Longer periods invite higher rates and vice versa. From the table listed above, the rate for depositing for 1 year to 1 year 364 days is 6.60% while that of 3 years to 10 years is 6.80%.

**Age of the depositor**

The second factor that impacts the rates of interest is the depositor’s age. Senior citizens will earn 0.5% additional interest compared to other customers.

**Reverse repo rate**

The last factor is the reverse repo rate, one of the instruments of monetary policies of the Reserve Bank of India (RBI). The RBI borrows money from the commercial banks (like IOB) and pays them interest as per the reverse repo rate. If this rate is high, banks will earn more interest on the deposits and, in turn, increase the rate of interest on their term deposits (like recurring deposits).

Advantages of using an IOB Bank RD calculator are –

- Provides accurate results.
- Calculations do not require much hassle.
- Generates results promptly.
- Enables users to determine the amount and tenor of deposit.

Worthy to remember, individuals opening a recurring deposit with the Indian Overseas Bank can use an IOB RD Calculator to have a broad understanding of their investment prospects in advance.

MOST POPULAR ON GROWWVERSION - 5.2.4

STOCK MARKET INDICES: S&P BSE SENSEX | S&P BSE 100 | NIFTY 100 | NIFTY 50 | NIFTY MIDCAP 100 | NIFTY BANK | NIFTY NEXT 50

POPULAR MUTUAL FUNDS: QUANT SMALL CAP FUND | ICICI PRUDENTIAL COMMODITIES FUND | NIPPON INDIA SMALL CAP FUND | PARAG PARIKH FLEXI CAP FUND | GROWW NIFTY TOTAL MARKET INDEX FUND | SBI SMALL MIDCAP FUND | TATA DIGITAL INDIA FUND | AXIS SMALL CAP FUND | ICICI PRUDENTIAL TECHNOLOGY FUND | HDFC INDEX FUND SENSEX PLAN | HDFC SMALL CAP FUND | AXIS EQUITY FUND | CANARA ROBECO SMALL CAP FUND | TATA SMALL CAP FUND | UTI NIFTY FUND

MUTUAL FUNDS COMPANIES: GROWWMF | SBI | AXIS | HDFC | UTI | NIPPON INDIA | ICICI PRUDENTIAL | TATA | KOTAK | DSP | CANARA ROBECO | SUNDARAM | MIRAE ASSET | IDFC | FRANKLIN TEMPLETON | PPFAS | MOTILAL OSWAL | INVESCO | EDELWEISS | ADITYA BIRLA SUN LIFE | LIC | HSBC | NAVI | QUANTUM | UNION | ITI | MAHINDRA MANULIFE | 360 ONE | BOI | TAURUS | JM FINANCIAL | PGIM | SHRIRAM | BARODA BNP PARIBAS | QUANT | WHITEOAK CAPITAL | TRUST | SAMCO | NJ