UCO Bank offers recurring deposits within its ‘UCO Sowbhagya RD Scheme’. The bank offers an attractive interest rate of 5.55% on the deposited amount. Moreover, senior citizens can avail a 0.50% additional interest rate over regular interest rates. One of the most preferred investment methods preferred by people is Recurring deposits owing to their flexibility and low deposit amount apparently. Saving a small part of your monthly earnings in the form of a deposit and seeing it grow with the attractive UCO recurring deposit interest rate can help you save a substantial amount of money in case of any emergency.
|Tenure||General Interest rates (p.a.)||Senior Citizen Interest Rates (p.a.)|
|1 year 1 day – 2 years||5.00%||5.50%|
|2 years 1 day – 3 years||5.00%||5.50%|
|3 years 1 day – 5 years||5.00%||5.50%|
|5 years 1 day – 10 years||5.00%||5.50%|
Note – The above-given RD Interest rates are for RDs Less than 2 crores
Like many other financial institutions and NBFCs, UCO Bank provides investors with information on the corpus amount they will be earning depending on the monthly investment and lock-in period of the deposit.
It helps the investors make an informed decision regarding their investment and the period for which they should keep their principal invested.
A = P*(1+R/N)^(Nt)
Suppose Ajay has invested Rs. 10000 in a UCO Bank RD for 5 years and the applicable interest rate is 6.5%. Then the maturity amount will be – Rs. 7,09,902 (Investment amount – Rs. 6,00,000 and Interest – Rs. 1,09,902)
You can calculate the maturity amount on your RD account with the help of the UCO Bank Recurring Deposit Calculator available over a plethora of websites.
The RD maturity amount depends on a number of parameters, viz.
The account opening process of a Recurring Deposit account is easy and can be done using offline as well as online methods.
The following are the entities that can open a recurring deposit account with UCO Bank –
In the case of jointly held accounts, each holder is the beneficiary for the other. It means, in case of the demise of one individual, the other becomes the legal nominee.
If the interest earned on all your RDs across all branches of UCO bank in a year exceeds Rs. 10,000, the bank deducts 10.3% TDS. Moreover, if you don’t have your IT PAN updated in the UCO bank records, the bank must deduct twice the TDS which sums up as 20.6%. So, it is highly recommended to update your PAN on your RD.
Apart from TDS, you would need to add the interest income on the UCO bank RDs and other RDs as well to your taxable income for that year. The income tax is payable based on your tax bracket. You need to be spontaneous and estimate your interest income and all the other incomes and based on the same, pay advance tax on advance tax payment dates (15th Sep, 15th Dec, 15th March, and 31st March).
UCO bank issues Form 16A to its customers providing details of the deducted tax on RD interest tax deposited by it with government treasury.
An individual can also decide to withdraw their investments prematurely; however, in that case, he/she has to bear a penalty charge. UCO Bank charges a penalty of 2% less than the lower of the following – applicable interest rate on the date of redemption or the interest rate according to the period for which the deposit was held by the bank.
In the financial system, there are numerous deposit plans. They are classified into the following categories based on the time period during which they are valid:
The length of your deposit under this sort of UCO Bank Recurring Deposit ranges from 6 months to 3 years. This type of RD is most suited for people who want to build the habit of saving.
When you don’t want to commit for a long time and aren’t sure how much value you’ll gain from RD, a medium-term repeating deposit is a decent option. It provides the appropriate balance of flexibility and commitment to invest in order for you to evaluate its benefits. The tenure extends from three to seven years.
When you want to receive a return on your investment but do not have the lump sum cash to invest in a fixed deposit, a long-term RD is the ideal option. By investing in recurring deposits, you gain the option of making monthly installments that yield a similar rate of return to FDs. The tenure restrictions.
Q1. What is the minimum deposit amount required to open a UCO Bank RD account?
You just need to deposit Rs. 100 to open the account and multiples of Rs.100 thereafter.
Q2. What is the tenure of UCO Bank Recurring Deposits?
An RD account in the UCO bank can be opened for a minimum of 12 months to a maximum tenure of 60 months.
Q3. Does the Bank Levies some Penalty on Premature Withdrawal
No, the amount can only be withdrawn upon maturity. In case you withdraw the amount before maturity, the bank deducts a 1%-2% penalty from the interest accumulated on the RD amount for the period the amount remained with the bank.
The minimum lock-in period is 3 months and if the account holder wants to withdraw the amount before that, he/she earns zero interest and gets only the principal amount refunded. Apart from nil interest, any incentives offered are also cancelled.
Q4. What is the interest rate charged by the bank for a loan against RD?
The bank charges 2% above the deposit rates for loans against RD.
Q5. Does the Bank provide a nomination facility?
Nomination facility is provided by the bank on UCO Bank recurring deposits. Whether the account is opened in a single or joint name, only one nominee per account is allowed. One should ensure that the nomination is as per the RBI rules. The nominee can be changed through declaration in an appropriate form.