IOB, short for Indian Overseas bank provides a recurring deposit scheme to its customers with attractive interest rates. One can save a substantial amount by putting aside a small number of your earnings with the help of great IOB recurring deposit interest rates offered by the bank. One can choose from tenures ranging from 6 months to 120 months (10 years). The interest rates of

IOB RD Interest Rates 2021

Tenure Regular Rates (p.a.) Senior Citizen Rates (p.a.)
180 days to 269 days 5.75% 6.25%
270 days to 364 days 6.25% 6.75%
1 year to 1 year 364 days 6.60% 7.10%
2 years to 2 years 364 days 6.75% 7.25%
3 years to 10 years 6.80% 7.30%

Indian Overseas Bank RD Interest Rates – Special Features

  • IOB provides a loan facility up to 90% of the RD amount
  • The highest interest rates offered to general citizens is 6.80% whereas, for senior citizens, it is 7.30%
  • The minimum deposit accepted by Indian Overseas Bank starts from as low as Rs. 50
  • Nomination facility is provided by the bank so that you can nominate your family member or spouse to collect the final matured amount
  • The deposit tenure ranges from 6 months to 120 months
  • The minimum deposit amount can be deposited in the multiples of Rs. 5
  • Any Indian resident, salaried individual, housewife, small trader,
  • TDS deductions are subject to the existing income tax rules set at the time of opening an account

Types of Recurring Deposits with IOB

Indian Overseas bank extends the following RD options for its customers. The RD details in IOB bank are mentioned below :

Recurring Deposit (Regular)

A regular IOB Recurring Deposit account can be opened for a tenure ranging between 6 and 120 months. Interest in these RDs is compounded every quarter. You can start your RD at IOB with a minimum deposit of Rs. 50.

Flexi Recurring Deposit

A Flexi RD with IOB can be started with a minimum core deposit amount of Rs. 1,000/month. The maximum deposit core deposit amount can go up to Rs. 1 Lakh/month and monthly deposits can range between the minimum core amount, i.e., Rs. 5,000 and 10x the minimum core amount. It should be in multiples of Rs. 100.

IOB’s Flexi RD comes with a special feature of no limit to the total number of credits subjective to the maximum remittance being ten times the core amount. The minimum tenure under Flexi RD starts from 12 months, with a maximum tenure ranging up to 120 months. You can opt for a suitable tenure in multiples of 6 months, starting from the minimum tenure of 12 months.

IOB Eighty Plus

The IOB Recurring Deposit variant can be opted for by super senior citizens. Interest rates on IOB Eighty Plus RD are applicable at 0.75% over the regular rates of interest applicable on term deposits. You can start an IOB Eighty Plus RD with a minimum tenure of 6 months, extending up to 120 months.


An individual over 60 years of age can open this Indian Overseas Bank Recurring Deposit account to enjoy interest-earning at 0.50% higher than the regular rates. RD under Vardhan can be started with a minimum amount of Rs. 100. Also, the minimum RD tenure is 6 months, with maximum tenure extending up to 120 months.

Premature Withdrawal of Indian Overseas Bank RD Amount

IOB allows premature withdrawal of your RD amount before the maturity date but charges a nominal penalty as per their norms. Also, partial withdrawals are not allowed.

Indian Overseas Bank offers a hassle-free RD account closure prematurely irrespective of the amount of deposit or the period opted or completed. The interest rate can, however, vary from the one agreed upon during an RD account opening. Plus, interest payable will depend on the amount deposited and the period for which it remained with IOB.

The charges applicable to the foreclosure of an RD account with IOB are as follows.

Types of RDs Applicable Premature Closure Charges
RDs of up to Rs. 15,000 0%
RDs between Rs. 15,001 and Rs. 5 Lakh 0.50%
RDs between Rs. 5 Lakh and Rs. 1 Crore 1%
RDs above Rs. 1 Crore 1%

How to Calculate IOB RD Interest?

The interest on the Indian Overseas Bank Recurring Deposit can be calculated with the formula:

A = P x (1+R/N) ^ (Nt)


  • A is the Maturity Amount.
  • P is the Recurring Deposit installment
  • N is the Number of times the interest is compounded.
  • R is the Rate of Interest
  • t is the tenure

For example, Mr H, who lives in Gujarat decides to open an RD account with IOB with a deposit amount of Rs. 4000 for 3 years. The interest rate he is getting is 6.5%. In that case, the total interest amount upon maturity will be Rs 5498, and his total maturity amount will be Rs. 1,59,300.

Eligibility Criteria for Opening an IOB Recurring Deposit Account

You need to belong to either of the following categories to open an IOB Recurring Deposit account.

  • A salaried individual
  • Small trader
  • Student
  • Housewife
  • An individual with periodic income
  • A rural investor
  • An individual with limited income is able to save only in a small amount.

Documents Needed to Open RBL RD Account

Identity proof (any 1)

  • Passport
  • Voter ID card
  • PAN card
  • Driving License
  • Government ID card
  • Photo ration card
  • Senior citizen ID card

Address Proof (any 1)

  • Passport
  • Telephone bill
  • Electricity bill
  • Bank statement with cheque
  • Certificate /ID card issued by the post office

IOB RD Interest Calculator

The RD maturity amount you receive is the sum of all the below-given parameters. Alternatively, one can also use the IOB RD Interest calculator to check the interest earned on their deposit. One might need the below-given details of their RD account to calculate the maturity amount.

Deposit Amount: The initial amount deposited by a customer in their account. The minimum deposit amount for IOB RD starts from as low as Rs 50.

IOB RD Interest Rates: Indian Overseas Bank offers a higher rate of interest on recurring deposits with longer tenure and lowers interest rates for an account opened for a shorter period. The highest interest rate offered by the bank is 6.80% for the deposit amount.

Deposit Tenure: As mentioned in the previous point, low-interest rates are offered for short tenure RDs and vice-versa.

Benefits of IOB RD Account

  • One gets to enjoy attractive interest rates by IOB on recurring deposits
  • Senior citizens get the privilege of earning 0.50% over the regular interest rates
  • With great offers like loan and nomination facility, it becomes easier to save money in a convenient way

Penalty for Non Payment of Monthly Instalments

Bank grants you a few days grace to clear the pending payment which you have missed owing to some reasons. However, in case you don’t pay your instalment even after that grace period, the bank will charge a penalty as per their norms.

How to Open an RD Account at Indian Overseas Bank?

An RD account with IOB can be opened in two ways:

  1. Offline

By visiting the nearby IOB branch with all the required documents.

  1. Online – Through net banking

If you are already an Indian Overseas Bank account holder, you can use the net-banking credentials to log in to your online account and open an e-RD right away. However, if you are not an Indian Overseas customer, an account needs to open first. You can use the net banking facility and open an e-RD once the account is active,

IOB RD Interest Rates – Frequently Asked Questions

Ques. What is the minimum deposit required to open an RD account in Indian Overseas Bank?

Ans. The minimum deposit required to start an RD account in IOB is Rs. 50.

Ques. What is the eligibility to open an IOB RD account?

Ans. Any individual who is an Indian resident and HUF (Hindu Undivided Families). Moreover, NRIs can also open an RD account through NRO and NRE accounts. Bank also provides an RD scheme for minors (less than 10 years of age) under the guardianship of parents to monitor their finances.

Ques. What are the documents required for IOB Recurring Deposit Scheme? 

Ans. Any valid identity proof and address proof will suffice along with passport size photographs of the applicant and duly filled application IOB RD account.

Ques. Does IOB allow partial withdrawal of the RD account?

Ans. No, the bank doesn’t allow partial withdrawal of recurring deposits.

Ques. How is the interest calculated on the IOB RD Account

Ans. Interest in IOB account is compounded on a quarterly basis

Ques. Is there any lock-in period on the IOB RD account?

Ans. Yes, the minimum lock-in period is 3 months and if the account holder wishes to withdraw the amount before that, no interest is provided by the bank and the principal amount is refunded to the source.

Ques. Is Nomination Facility Allowed in IOB Recurring Deposit Scheme

Ans. Yes, Indian Overseas Bank provided the nomination facility.

Ques. Will my RD interest attract TDS?

Ans. No, TDS deduction on RD interest earning is not applicable as per the Income Tax Act 1961.

Ques. How much loan can I avail on an accrued RD of Rs. 50,000?

Ans. With IOB, the loan available on the accrued amount of RD is up to 90%. Hence the loan you can avail on the accrued amount of Rs. 50,000 can be up to Rs. 45,000.

Ques. Can I start a Flexi RD with a minimum tenure of 6 months?

Ans. No, the minimum tenure for a Flexi RD with IOB is 12 months.