Axis bank provides the facility of opening a Recurring Deposit and earn profits on the deposited money in the form of interest. An Axis Bank recurring deposit account can be opened for tenures ranging from 6 months to 120 months (10 years). The Axis Bank RD interest rate ranges from 4.40% p.a. to 7.30% p.a. Senior citizens are entitled to get a 0.50% extra interest over the regular ones.
Axis Bank RD Interest Rates 2021
|Tenure||General Interest rates (p.a.)||Senior Citizen Interest Rates (p.a.)|
|9 months – 11 months 24 days||4.40%||4.65%|
|1 year 5 days – 1 year 10 days||5.10%||5.75%|
|1 year 11 days – 12 months 29 days||5.10%||5.75%|
|1 year – 1 year 4 days||5.15%||5.80%|
|11 months 25 days – 364 days||5.15%||5.40%|
|13 months – 13 months 29 days||5.10%||5.75%|
|14 months – 16 months 29 days||5.10%||5.75%|
|17 months – 17 months 29 days||5.10%||5.75%|
|18 months – 1 year 364 days||5.25%||5.90%|
|2 years – 29 months 29 days||5.40%||6.05%|
|3 years – 4 years 364 days||5.40%||5.90%|
|30 months – 3 years||5.40%||5.90%|
|5 years – 10 years||5.50%||6.00%|
Axis Bank Recurring Deposit – Special Features
- The minimum deposit amount needed to open an RD account at Axis Bank is Rs. 500
- The tenure ranges from a minimum of 6 months to a maximum of 120 months (10 years)
- Senior citizens can avail up to 0.65% extra rate of interest than general rates
- The minimum amount can be deposited in multiples of Rs. 10
- Premature withdrawal is allowed with a nominal penalty as per the bank norms
- TDS deduction on Axis Bank Recurring Deposit interest rates is applicable subject to the existing rules as at the time of opening the account
- The late payment penalty is Rs. 10 per Rs. 1000 per month
- Partial withdrawal is not allowed on Axis Bank RD account
Premature Withdrawal Facility and Rules on Axis Bank RD
Individuals can withdraw prematurely from their Axis Bank RD account, but a penalty equivalent to 1% of the applicable interest has to be paid by them. Such a feature would help individuals to meet their financial crunch at a time of need. However, it should be noted that partial withdrawal from the RD is not applicable.
Moreover, if there is a delay in the monthly payments, the bank will charge Rs. 10 per Rs. 1000 a month. For instance, if the deposit amount is Rs. 2000, the late payment penalty will be Rs. 20
How to Calculate Axis Bank RD Interest?
The interest offered on Axis Bank Recurring Deposit is compounded at each quarter.
The formula used for calculation of the maturity value is –
A= P x (1+R/N) ^ (Nt)
A is Maturity Amount.
P is Recurring Deposit.
N is Number of times the interest is compounded.
R is Rate of interest.
T is Tenure.
Here is an example of the same,
Rahul deposits Rs. 500 each month for 9 months. The rate of interest applicable on her Axis Bank Recurring Deposit account is 6.5% (for regular RD). The sum on maturity would be –
A= P x (1+R/N)^(Nt)
= 4500 x (1+6.5/4)^(4×9/12)
= Rs. 4,623.
Hence, the interest income from the recurring deposit is Rs. 123.
Important Note: The interest in RD with Axis Bank is calculated quarterly.
Eligibility Criteria for Axis Bank RD
- The applicant should be an Indian resident or a HUF (Hindu Undivided Families)
- NRIs can opt for an RD account through NRO and NRE accounts
- In case of a minor, he/she can open an Axis Bank RD account under parental guardianship to supervise your finances
Documents Required to Open an RD Account with Axis Bank
- Individuals would require submitting these documents to open an Axis Bank RD account.
- Documents that serve as identity proof such as Aadhaar card, PAN card, Passport, driving license, ration card, etc.
- Documents that serve as an address proof, namely, passport, electricity bill, telephone bill, etc.
How to Apply for a New Axis Bank RD Account?
Individuals can apply for an Axis Bank Recurring Deposit –
- Via Internet Banking.
- Via Mobile Banking.
Individuals opting for the offline application would be required to visit their nearest branch to complete the formalities.
However, individuals applying through internet banking or mobile banking would have to access the official website of Axis Bank or the bank’s mobile app respectively and complete the formalities accordingly.
Axis Bank RD Calculator
The simplest way to check how much profit you will make upon maturity of your Axis Bank RD account is to use the online calculator of Axis Bank RD calculator which can be accessed on various websites. This is by far the simplest method to evaluate the interest. All you need to do is provide the basic details in the fields like amount, tenure and the rate of interest.
For example, if you want to check how much profit you will earn if you are depositing Rs. 1000 per month in an Axis Bank RD, for a period of three years; all you have to do is to fill the fields asking for the details like the installment amount, tenure, which is 3 years and 0 months. If the rate of interest is 6.50%, your RD maturity details will entail the maturity value as Rs. 39, 824, where the aggregate interest amount is Rs. 3,824.
Taxation of Axis Bank Recurring Deposit
Under the guidelines laid down by the Income Tax Act 1961, all Recurring Deposits are liable for taxation.
The proceeds earned by an individual would incur a TDS at the rate of 10% if the accrued interest exceeds Rs. 10,000 in a financial year. However, individuals who would not be able to furnish PAN would incur TDS at the rate of 20%.
However, individuals can protect their earnings against TDS by submitting a declaration under Section 197A. They can do so by filling a 15G or a 15H form, whichever is applicable in their case.
Axis Bank RD Rates – Frequently Asked Question.
Ques. What is the minimum monthly instalment for Axis bank RD?
Ans. The minimum monthly instalment needed to open an Axis Bank RD account is Rs. 500 whereas the maximum amount can be made in certain multiples and has got no limit.
Ques. Does Axis bank allow partial withdrawal of the funds?
Ans. No. Partial withdrawal of the deposited amount is not allowed by the bank.
Ques. Does the bank charge any tax on the interest earned?
Ans. Yes, the interest earned on the RD account is taxable under the Income Tax Act, 1961. If the total projected interest crosses Rs. 1000 in a financial year, TDS is deducted accordingly, i.e. 10% if the PAN details are shared and 20% in case you haven’t shared it.
Ques. Is a nomination facility available in Axis bank RD?
Ans. Yes, Axis Bank provides nomination facility to its customers on RD account. Only one nominee is per account is permissible, whether it is in a single name or joint name. The nomination process should be carried out as per the RBI rules. One can change the nominee through declaration in the appropriate form.
Ques. Is investing in the Axis Bank RD worth?
Ans. Axis Bank RD interest rates are indeed one of the best competitive rates in the market and one can expect a decent return on investment by putting the money in the Axis RD account. Recurring deposits can allow you to park your money periodically and earn interest on your surplus savings. It is strongly recommended to read and understand all the investment-related documents carefully before proceeding with the investment.