Recurring Deposit
A structured savings plan with regular deposits over a fixed duration.
Detailed Description
Recurring Deposit
What is the primary purpose of a Recurring Deposit?
The primary purpose of a Recurring Deposit is to encourage disciplined savings by allowing individuals to deposit a fixed amount at regular intervals.
How do interest rates on Recurring Deposits compare to savings accounts?
Interest rates on Recurring Deposits are typically higher than those offered on regular savings accounts, ranging from 5% to 8% per annum.
What are the eligibility criteria for opening a Recurring Deposit?
Most banks require applicants to be at least 18 years old and have a valid ID, along with an existing savings account to facilitate monthly deposits.
Can funds be withdrawn from a Recurring Deposit before maturity?
Generally, premature withdrawal is not allowed, but some banks may permit it with a penalty or reduced interest rate.
What are common uses for Recurring Deposits?
Recurring Deposits are commonly used to save for short- to medium-term goals like vacations, weddings, education expenses, or to build an emergency fund.