Recurring deposits are an ideal savings instrument for individuals who want to earn fixed deposit-like interest on their surplus income but without making a lump-sum deposit.

RBL Bank offers the recurring deposit facility at attractive interest rates to ensure sustainable but accelerated wealth appreciation. Individuals can open an RD account with RBL Bank for a lock-in period ranging from 6 months to 20 years.

At the end of the maturity period, depositors can withdraw their accumulated deposits along with the accrued interest as on that date. Depositors can learn the matured value of their deposits prior to opening an RD account with the aid of an RBL RD calculator.

The RBL RD calculator is an online tool that is available to users free of charge. Prospective depositors can use this tool to calculate the returns they can earn from their monthly deposits in an RBL Recurring Deposit scheme. It works on three variables – rate of interest, monthly deposit amount, and maturity period.

Therefore, prospective depositors can alter the variables as per their suitability to find what works for them.

RBL Bank Recurring Deposit Interest Rates 

The rates of interest applicable on RBL Bank Recurring Deposits as of 16th May 2020 are presented in the table below –

Maturity periods For deposits below Rs.2 Crore For deposits of Rs.2 Crore and more up to Rs.3 Crore
Normal interest rates (%) Senior citizen interest rates (%) Normal interest rates (%) Senior citizen interest rates (%)
180 days 6.40 6.90 6.40 6.90
181 days – 240 days 6.65 7.15 6.65 7.15
241 days – 364 days 6.65 7.15 6.65 7.15
12 months – less than 24 months 7.20 7.70 7.2 7.7
24 months – less than 36 months 7.25 7.75 7.25 7.75
36 months – 36 months 1 day 7.50 8.0 7.5 8.0
36 months 2 days – less than 60 months 7.0 7.50 7.0 7.5
60 months – less than 120 months 7.15 7.65 7.15 7.65
120 months to 240 months 6.65 7.15 6.4 6.9

How is Interest Calculated on RBL Recurring Deposit?

The interest for the RBL Recurring Deposit amount is computed on the principles of the compound interest method of calculation. The interest is compounded every quarter from the date of the initial deposit. For example, if Rahul opens an RBL Recurring Deposit account on 15th May 2020, the interest on the balance in his RD account would be compounded on 15th August, 15th November, 15th February, and 15th May, and so on until maturity.

The formula for calculation of the compound interest on the accumulated deposit amount in RD is given below:

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

In this RD formula,

  • M represents the maturity value,
  • R stands for the deposit amount,
  • n denotes the lock-in period in quarterly terms, and
  • i is the rate of interest divided by 4.

This formula is used industry-wide for the calculation of recurring deposit maturity value. It is also the functioning formula in the RD Calculator RBL Bank.

Example of RD calculation: 

Rahul opens an RBL RD account on 15th May with an initial deposit amount of Rs.2000. He opts for a lock-in period of 36 months and 1 day and enjoys an interest rate of 7.5% p.a. on it. 

As per the formula, R = Rs.2000, n = 12 [36 months = 12 quarters], and i = 0.01875 [0.075 / 4]

M = Rs. [2000 x {(1 + 12) x 12 – 1} / 1 – (1 + 0.01875) (-1/3)]

Or, M = Rs.81,543

Ergo, if Rahul deposits Rs.2000 per month for 36 months, his total earnings from the RBL RD account on 36 months and 1 day will stand at Rs.81,543.

This calculation can be done more conveniently with the use of the RD Calculator RBL. Moreover, with the use of a calculator, the chances of miscalculation are negligible and thence, more reliable.

What are the Factors that influence Interest Earnings from the RBL RD Scheme?

The factors that affect interest earnings from the RBL RD scheme are –

  • Payout scheme

According to the recurring deposit stipulations set forth by RBL, a depositor can opt for monthly payouts of the accrued interest. However, in doing so, the interest payout will be subject to discounts based on that day’s prevailing rates.

  • Age of depositor

If a depositor is aged more than 60, i.e. a senior citizen, then he/she is liable to earn an additional 0.50% interest on deposits.

  • Reverse repo rate

Any changes in the reverse repo rate by RBI will be directly reflected in the interest rate on deposit schemes.

  • Maturity period

The interest rate is subject to the lock-in period chosen by a depositor.

What are the Benefits of Using the RBL RD Calculator?

This calculator makes for a convenient way to calculate the maturity amount on RD because it is –

  • Simple to use
  • Produces results instantaneously.
  • Yields accurate results without any miscalculations.
  • Can be used multiple times, by adjusting the variables.

Individuals can thus make decisions concerning the maturity period and sum of their RD deposit, based on the results produced by the calculator.

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