Overview of Andhra Bank
This leading bank in the Deccan plateau was founded by noted freedom fighter Bhogaraju Pattabhi Sitaramayya in 1923 with a paid up capital of Rs.1 Lacs. Today, this medium sized public sector bank is a leading bank in South India combing key towns and cities in this region. Listed on both NSE and BSE, Andhra bank offers an array of banking and financial services to millions of customers in India. Together, Andhra bank has over 2,350 branches globally including India served by a strong staff of over 20,000 employees.
Headquartered in Hyderabad, the joint capital of Telangana and Andhra Pradesh, the bank also has representative offices in foreign locations, primarily based in UAE and USA. In the consumer banking division, it offers a full range of deposit services that includes Savings & Current account, Fixed deposit and Recurring deposit services for all categories of customers.
Recurring Deposit (RD) From Andhra Bank
There are two types of Recurring Deposit schemes offered by this bank which come with salient features and benefits at par with market standards. Your RD is linked to your savings account for ease of mapping and debit instructions. You can manage your RD account conveniently with internet and mobile banking options from Andhra Bank.
Recurring Deposit schemes from Andhra Bank
Andhra Bank RD schemes are of two types:
- AB Recurring Deposit
- AB Recurring Deposit Plus
The former is the traditional deposit scheme that comes with no maximum ceiling in terms of the deposit amount and the investment period ranges from 6 months to 10 years. A nominal penalty is applicable for closure within 6 months.
The latter is a new age RD scheme which comes with the advantage of interest accruals on deposit not being subjected to TDS along with other benefits borrowed from the conventional scheme. An attractive feature of the AB Recurring Deposit Plus is an exclusive option which lets the depositor step up the amount up to 10 times of the originally opted amount.
Features of Andhra Bank Recurring Deposit
AB Recurring Deposit
- No cap on monthly deposit amount
- The depositor can choose a deposit period ranging from 6 months to 10 years
- Compounded interest rates are applied on a quarterly basis
- During the initiation phase, the depositor can fix the amount he wishes to invest on a monthly basis. The deposit amount cannot be altered.
- Penalty (in slabs) applies if the depositor wishes to terminate the scheme before 6 months.
AB Recurring Deposit Plus
- Deposit period can range from 6 months and can go up to 60 months.
- Interest rates are dependent on the term and can vary slightly depending on various conditions. Senior citizens are eligible for an additional 0.50% on the standard rates.
- The monthly deposit amount can be in multiples of Rs.100 which is capped at Rs.1,00,000.
- The depositor needs to choose a “core amount” which will act as a reference point for stepping up the installment amount.
- Deposit amount can be increased up to 10 times the core amount as decided by the depositor.
Interest Rates Offered on Andhra Bank’s Recurring Deposit
The rate of interest depends on the various inputs such as the maturity period or deposit period and the amount accumulated in the account at the time of applying interest rates on a quarterly basis. Typically, the rate of interest starts from 8.25% and can go up to 8.50% depending on the period of investment. Check with the nearest branch for latest rates on term deposits or visit the website for up-to-date information on rates and features.
Additionally, senior citizens and existing/retired staff of Andhra Bank are eligible for an additional rate of 0.50%. Corporates and firms with large value deposits can qualify for an enhanced rate of interest. Check with the nearest branch for latest interest rates since Andhra Bank revises key rates on a periodical basis.
The applicable interest rates are the same for both schemes as per the standard rate system of the bank for deposit products.
Process for Opening a Recurring Deposit with Andhra Bank
RD accounts can be opened at any of the branches of Andhra Bank. If you’re an existing account holder with a specific branch, approach them for signing up for an RD account. Standard documents and proofs relating to identity, address and PAN should be produced along with duly filled forms. Non savings/current account holder will be required to open one for ease of auto debits and usage.
Terms and Conditions of Recurring Deposit Scheme of Andhra Bank
- For the regular time deposit, minimum period of investment is 6 months and the maximum is 10 years.
- For AB Recurring Plus, the period can range from a minimum of 6 months with a cap of 60 months (6 years).
- No cap on maximum monthly deposit amount for the regular RD scheme and for the Recurring Plus, the maximum amount is Rs.1,00,000/-
- In the AB Recurring Plus scheme, the depositor will be required to choose the “core amount” which will act as a base amount for stepping up monthly installment value.
- The deposits made during a month shall not fall below the core amount and the step up’s cannot exceed 10 times the base value.
The interest accrued on a quarterly basis is payable after deduction of applicable taxes. In case of the AB Recurring Plus scheme, the interest accruals are not subjected to TDS (Tax Deduction at Source). This scheme also helps individuals, corporates and firms who wish to build a large corpus over a period of time with its flexible and progressive features.
Penalty Clause (RD Premature Withdrawals in Andhra Bank)
For premature withdrawals, Andhra bank levies a penalty on all closures before 6 months term in the slabs below.
- Rs.10 if the outstanding balance in the RD account is less than Rs.100.
- Rs.20 if the balance is between Rs.100 to Rs.1,000.
- Rs.50 for all any balance value exceeding 1,000 rupees.