The Canara Bank Recurring Deposit account enables an individual to save a certain amount of money on a monthly basis where he/she can earn interest as applicable on a Fixed Deposit (FD) account. The Canara Bank RD Interest Rate is available for as 6.00% and high as 7.00% for regular citizens and ranging from 6.50% to 7.50% for senior citizens. The rate of return offered by the bank is based on the tenure and other eligibility criteria. Canara Bank provides an option to open an RD account for a minimum of 6 months up to a maximum of 10 years. An RD account can be opened for a fixed tenure which can be liquidated if required. However, the interest rates on these types of accounts are subject to premature liquidation fee as per the terms and conditions as specified by the bank.
Given below is a list of interest rates offered by Canara Bank on its RD scheme according to the tenure of the deposit. The rates given below are w.e.f. 28.05.2018.
|Tenure||Regular RD Interest Rates (p.a)||Senior Citizen RD Interest Rates (p.a)|
|180 days to 269 days||6.35%||6.85%|
|270 days to less than 1 year||6.35%||6.85%|
|1 year only||6.50%||7.00%|
|Above 1 year to less than 2 years||7.00%||7.50%|
|2 years & above to less than 3 years||6.20%||6.70%|
|3 years & above to less than 5 years||6.20%||6.70%|
|5 years & above to less than 8 years||6.00%||6.50%|
|8 years & above to 10 years||6.00%||6.50%|
*The above interest rates are for investments less than Rs.1 crore
Factors for Opening a Canara Bank RD Account
In order to open an RD account, an individual is required to meet the eligibility criteria specified by the bank. The following factors are essential to consider before opening Canara Bank Recurring Deposit Account –
- Eligibility: Canara Bank RD account is available for any individual, joint account, Hindu Undivided Family (HUF), guardian of a minor, a company, an association, proprietorship firm, a trust, or any institution who fulfils the eligibility requirements.
- Deposit Amount: An account can be opened for a minimum of Rs.50 per month for a fixed term without any cap on the maximum amount.
- Term of Deposit: An RD account can be opened for a minimum period of 3 months up to a maximum of 10 years.
- Rate of Interest: Depending on the deposit amount and the account term, the interest will be compounded on a quarterly basis. Senior citizens are entitled to an additional 0.50% interest rate over and above the regular interest rate for individuals below 60 years of age.
- Premature Withdrawal: If the account is liquidated before the maturity, the account will be subject to premature withdrawal charges as specified by the bank.
Canara Bank Recurring Deposit: Eligibility Criteria
The eligibility criteria for opening a recurring deposit account in Canara bank is as follows:
- Any individual is eligible to open a recurring deposit account with Canara bank.
- An individual can also open a recurring deposit account with another person. The account will be a joint account.
- A minor can open a recurring deposit account in Canara bank under the supervision of the natural or legal guardian.
- A Hindu Undivided Family (HUF) is also eligible for opening a recurring deposit account in Canara bank.
- A proprietorship firm, a company, a trust, an association or an institution is eligible to open a RD account as a group.
Documents Required to Open Canara Bank RD Account
- The application form for opening a recurring deposit account in Canara bank.
- A copy of the applicant’s PAN card.
- If the applicant does not have a PAN card, then he or she has to submit the Form 60/61.
- 4 passport size photographs of the applicant.
- Address proof of the applicant along with the address according to KYC rules.
- Any documents that the bank may require from the proprietorship firm, the company, trust, the association or institution.
How to Apply for a Canara Bank RD Account?
In order to apply for an RD account, the individual is required to visit any of the Canara Bank’s branch with the following documents –
- Bank specified application form
- PAN card copy or Form 60 or 60 in the absence of PAN
- 2 copies of photographs
- Proof of identity
- Proof of address
- Other documents based on the applicant’s profile
Premature Withdrawal Of Canara Bank Recurring Deposit
Any premature withdrawal or closure of the recurring deposit account by a person in Canara bank will be charged a penalty of 1%.
Canara Bank Dhanvarsha RD Scheme
Canara Dhanvarsha is a flexible recurring deposit scheme which allows the account holders to deposit more than the monthly required amount. Under this scheme, the customer can choose to invest surplus/bonus funds into their Canara Dhanvarsha account. The extra deposits will reward the account holder with additional interest over and above the contractual interest on the required monthly deposits.
Canara Bank Dhanvarsha RD Scheme is available for both residents as well as non-resident Indians. By making a minimum monthly deposit of Rs.1,000 up to a maximum of Rs.1 lakh, the Canara Dhanvarsha RD account can be opened for a minimum of 1 year up to a maximum of 10 years. This scheme doesn’t provide any special interest rates for senior citizens. Facilities such as nomination, loan facilities, etc. are applicable under this scheme.
Benefits of An RD Account
An RD account is considered to be one of the ideal avenues for saving money conveniently. Moreover, the nest-egg built through an RD account with a systematic and regular saving approach can help a customer in achieving his/her financial goals to a large extent.
RD accounts are popular for various features which are beneficial to the account holder. A customer can open an RD account and earn interest on it by paying a small amount every month for a specific duration of time. At maturity, the account holder will earn interest on the RD account based on the deposit value, the tenure of the account, and the terms and conditions specified by the bank. Additionally, Canara Bank RD holders can expect the following benefits and features from their accounts -
- Deposit Amount: Canara Bank RD account can be opened for a minimum of Rs.50 per month. If the customer wants to save more, he/she can choose to increase the amount in multiples of Rs.50. Moreover, there is no cap on the maximum deposit amount making it more desirable and convenient to individuals who have a higher savings goal.
- Deposit Term: Based on the customer’s requirements, he/she can choose to open an RD account for a minimum of 6 months to a maximum of 10 years.
- Rate of Returns: The interest is compounded on a quarterly basis which offers high returns even when the customer wants to opt for the premature withdrawal. The rate of interest is based on the term of the deposit, account holder’s age and other factors such as tax rules, premature withdrawal, etc.
- Loan Facility: Considering the fact that most RD account holders move a considerable amount of their income to an RD account, an emergency or an uncertain situation can force the customer to consider liquidation or premature withdrawal. However, in order to ensure a certain kind of financial protection for the customers, Canara Bank offers a maximum of 90% of the available deposit balance as the loan against the RD account. The calculation of the permissible loan amount is based on the value of the deposit, deposit terms, and other eligibility factors as per the terms and conditions of the bank.
- Nomination: The RD account holders can choose to either edit the nominee’s details which were provided at the opening of the account or modify the details later during the account term.
FAQs on Canara Bank Recurring Deposit
How can I open an RD account in Canara Bank?
Customers/applicants can visit any of the Canara Bank’s branch to open an RD.
Is there a difference between the interest rates for RD and FD?
No, most banks provide similar interest rates for both RD and FD accounts.
What are the documents required for opening an RD account?
In addition to the filled in application form, applicants are required to have the following documents –
- Pan Card copy or Form 60 or 61 (in case of no PAN)
- 2 passport size photographs of the applicant
- Proof of identity and proof of address
- Specified documents based on the applicant’s profile
An RD account can be opened for as low as Rs.50 per month while there is no limit on the maximum amount of deposits.
An RD account can be opened for a minimum period of 6 months to a maximum period of 10 years.
Yes, however, there are certain types of RD account that don’t have a renewal option.
Yes, you can either add the nomination while opening the RD account or before the maturity by contact the branch,
Yes, a customer can avail a maximum of 90% of the total deposit balance as the loan amount. It is a secured loan where the loan is given against the FD account, hence the deposits in the FD will be held as collateral.
Senior citizens are entitled to an additional 0.50% of interest rates on any of the FD accounts.
Yes, however, the liquidation will be subject to premature closure charges.
Yes, a guardian is allowed to open an RD account on behalf of a minor.
Canara Bank levies a 1% premature withdrawal charge based on the deposit amount, account opening and renewal dates.
With pan-India presence, Canara Bank can be contacted through telephone, email, or a branch visit.
More you need to know about Recurring Deposit
- RD Calculator
- Recurring Deposit
- Compare Recurring Deposit Interest Rate of Canara Bank with Other Banks and Institutions
- Tax on Recurring Deposit Interest Rates