Whoever said wishes don’t come true hasn’t explored our offers!
  • Difference Between Recurring Deposit and SIP

    Setting aside a fixed amount of money every month specifically for savings or investment is the best way to create wealth. Systematic Investment Program (SIP) in Mutual Funds and Recurring Deposits are two most popular ways to invest a fixed amount every month. In a SIP, the investor has to set aside small amounts of money either monthly or quarterly rather than having to invest a lump amount. In a Recurring Deposit scheme, a person deposits a fixed amount every month for a predefined period of time. At the end of the tenure, he gets back the interest and investment amount.

    For people willing to invest a fixed amount every month rather than a single time investment of huge amount, opening a RD, PPF or starting a SIP are the most preferred options.

    RD VS SIP

    SIP Vs RD - Product Structure

    Recurring Deposits - In a Recurring Deposit scheme, the individual has to first choose the tenure and monthly deposit amount. Once the plan starts, the investor must deposit the amount every month over the tenure. Generally, the tenure varies from a minimum of 6 months and thereafter in addition of 3 months to a maximum tenure of up to 10 years. Recurring Deposit proves to be gentle on one’s pocket given that the investor decides the amount and also the risk is considerably low.

    Interest rates for recurring deposits are decided based on the tenure and deposit amount. The rate of interest for recurring deposit generally varies from 7% to 8% and senior citizens are offered a higher rate of interest. Recurring Deposit accounts can be started at banks or post offices. Unlike SIP, in RD you will know how much to expect at the end of tenure. For example, if you want to save a corpus of Rs. 3 lakh for an international trip, you can use a RD Calculator to decide how much you have to deposit every month and for how many years to save Rs. 3 lakhs.

    One of the main disadvantages of Recurring Deposits is the fact that it is not tax efficient. Interest income from RD is added to income for declaring tax liability and a TDS will be applicable on the RD interest if it exceeds Rs. 10,000.

    Systematic Investment Plan - A SIP can be chosen by investing in mutual funds. In a SIP, the investor has to deposit a small sum every month or every quarter and the amount of investment can be as low as Rs. 500. If you choose a mutual fund scheme and invest in SIP, based on the plan that you have opted for they will allocate your money in debt or equity. In recent times, equity mutual funds have generated good returns which have been in excess of recurring deposit or fixed deposit schemes. The returns generated by SIP mutual funds have been around 12% to 22% in the last 5 to 10 years. One of the main disadvantages of SIP lies in the fact that even if you keep depositing the amount, nothing can be promised and if the stock markets crash, you might end up losing more than what you get. Also, you will have to hold the fund for a long time to get good returns.

    Which is Better Systematic Investment Plan Or Recurring Deposit

    Factors Recurring Deposit (RD) Systematic Investment Plan (SIP)
    Investment Scheme In a RD scheme, you will have to invest in a deposit plan that will give you fixed rate of returns. You can also opt for flexible recurring deposit scheme if you are looking for more flexibility. In a SIP for mutual funds, you can choose between debt or equity type of funds depending on your risk capability.
    Risk Factor Recurring Deposits are not prone to risks and is one of the safest form of investment. Returns that you can expect from the SIP are variable. There can be a risk of capital and returns depending on the stock market. But, recent data shows us the SIP gives good returns if held for a long period of time.
    Investment Type In a Recurring deposit scheme, the investor has to deposit a fixed amount every month. Systematic Investment Plan is a way to put your money on mutual funds. Investment can be done on a periodic basis - daily, weekly, monthly or quarterly.
    Returns As the rate of interest is fixed in a recurring deposit scheme, the return is also fixed and known at the time of investment. The returns from a SIP for mutual funds is dependent on debt and equity markets and is also based on the fund scheme chosen by the investor.
    Liquidity Recurring Deposit is liquid but premature withdrawal or closure will attract penalty charges. In terms of liquidity, a SIP is better when compared to RD. SIP can be closed and the money can be withdrawn without any penal charges.
    Taxation Recurring Deposit amount or the interest earned on it are not exempted from tax. SIP investments and returns are exempted from tax only when invested on Equity Linked Savings Scheme (ELSS) funds.
    Instalment Frequency Recurring Deposit usually come with monthly instalments SIPs offer flexible instalment plans of daily, weekly, monthly, quarterly etc.
    Investment Goal Recurring Deposits usually serve short-term savings goal and do not help in long-term wealth growth. SIPs can help in all kinds of investments goals, whether short- or long –term, depending on the frequency of investment, funds chosen and other factors.
    Recurring Deposit - Sitemap

    Customer Reviews

  • Page 1 of 50 1 2 3 4 5
    • Kotak Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 5.0/5 "Blown Away!"
      The personal loan service was prompt from Kotak Mahindra, but within the time they process my personal loan application. I have arranged the required loan amount so that was the reason I haven't got the loan with kotak. The rate of interest is nominal with Kotak mahindra.
      Was this review helpful? 0
      , faridabad
      Reviewed on Sep 23, 2017
    • Punjab National Bank Home Loan
      "Be consistent in the details"
      PNB HOUSING FINANCE LIMITED
      0.5 1.0/5 "Really Bad"
      PNB housing finance was not a good one for me, though they were okay in the process. They have charged me 100% of the processing fees when I was supposed t be charged only 50%. I had to pay more than 11k. They need to be consistent in the whole process.
      Was this review helpful? 0
      , vadodara
      Reviewed on Sep 23, 2017
    • LIC Life Insurance
      "Jeevan key saat be or Jeevan key baath be"
      LIFE INSURANCE CORPORATION OF INDIA
      0.5 4.0/5 "Great!"
      I have taken a life insurance from LIFE INSURANCE CORPORATION OF INDIA. Its a term insurance of 10 years. The annual premium is 25000 which i used to pay through cheque. After the completion of my maturity period i will get 4 lakhs. And in every 2 years i will get 30000.
      Was this review helpful? 0
      , allahabad
      Reviewed on Sep 23, 2017
    • Bank Bazaar Personal Loan
      "Good service"
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      Bank bazaar gives a simplified data to the customers, It is easy to compare and choose the product with the help of bank bazaar website. The website of bank bazaar is easy to use and user friendly. The bank bazaar customer service has reached me within a hour time after I gave my requirement bank bazaar website,
      Was this review helpful? 0
      , srinagar
      Reviewed on Sep 23, 2017
    • ICICI Bank Personal Loan
      "Average service"
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      In concern to my perosnal loan, I got a quote in the beginning from ICICI bank but after that few changes were made in the rate of interest so that was the reason I haven't got the loan with ICICI bank. The Customer service is not up to the mark and they haven't fulfill my requirement . The rate of interest was nominal when compared with others, The follow up need to focused with ICICI executives.
      Was this review helpful? 0
      , srinagar
      Reviewed on Sep 23, 2017
    • SBI Saving Account
      "Not satisfied"
      STATE BANK OF INDIA
      0.5 2.5/5 "Just OK"
      I am not happy with State Bank of India. It is a salary account and there are no benefits as such. When ever I have applied for a loan they have not processed the same. The online banking is also not good and overall the bank is not recommendable from my end.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Bank Bazaar Home Loan
      "Satisfactory"
      PNB HOUSING FINANCE LIMITED
      0.5 4.0/5 "Great!"
      The services at Bankbazaar has been good and the experience is satisfactory. I faced no issues or inconvenience faced. The website is also good and it is very much informative and very easy to browse through and choose the best bank in the market.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Punjab National Bank Home Loan
      "Overall good"
      PNB HOUSING FINANCE LIMITED
      0.5 4.5/5 "Excellent!"
      PNB housing finance was very much cooperative and they collected my documents and processed my papers. The disbursement also happened as earlier as possible. The interest rate and processing charges is normal and the overall experience is perfect.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • review Consumer Durable Loan
      "Good service"
      BAJAJ FINSERV
      0.5 4.0/5 "Great!"
      I got the refrigerator and laptop with the help of Bajaj Finserv Consumer durable loan. There is no rate of interest with the Bajaj consumer durable loan but the late fee and the charges are high with BAJAJ. I have closed the loan within 9months of time after getting the fridge and laptops. I payback the loan amount through ECS mode.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • Universal Sompo Health Insurance
      "Good policy"
      UNIVERSAL SOMPO GENERAL INSURANCE
      0.5 3.0/5 "Satisfactory"
      I can say it is an average policy to use and I got the Universal sompo health insurance policy from past 2years. I pay Rs.4000 to renew the policy. This policy covers only 3 members which is myself, my spouse and my son. I never had any claim experience yet. The medical coverage is good with this policy it covers Upto 2lakhs.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • LIC Life Insurance
      "Good policy"
      LIFE INSURANCE CORPORATION OF INDIA
      0.5 4.0/5 "Great!"
      I got the life insurance policy with LIC around 5years. This policy has the tenure of 10years. I pay the premium of Rs.1200 in every 3months once. I pay the premium using LIC website. The policy coverage and the plan benefits are good with this policy.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • SBI Saving Account
      "Good banking service"
      STATE BANK OF INDIA
      0.5 4.0/5 "Great!"
      I use the State bank of India savings account for more than 3years. I don't use their net banking and their mobile application . The customer service is average with SBI, The rate of interest is nominal with SBI. I am satisfied banking with SBI.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • HDFC Bank Credit Card
      "Good "
      HDFC BANK
      0.5 4.0/5 "Great!"
      The good thing about HDFC Bank is they use their own servers for the transactions and payments on the card. But I guess they have too many customers that the servers are slow. I hold a credit card and the offers are good and the services are also good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Saving Account
      "Good account to use"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      I have started using Kotak mahindra salaried account for past 10months. I use the net banking and the mobile application which is easy to use and user friendly. The customer service is good with Kotak mahindra. They have offered me a personal loan and a credit card but I have got only personal loan.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • ICICI Bank Credit Card
      "Average "
      ICICI BANK
      0.5 3.0/5 "Satisfactory"
      ICICI Bank is also not up to the mark in the credit card. The one thing I do not like is the bank uses the third party servers for payments and that is not safe. The transaction needs to be more secured. There are charges for the card and in all not that happy to use it.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Bank Bazaar Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      For more than a year I am with bank bazaar. The bank bazaar customer service has reached me within 2hours of time. The response was very quick and fast from bank bazaar.The website of bank bazaar is easy to use and user friendly. I would say bank bazaar rendered very good service.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • SBI Cards Credit Card
      "Need more offers and features"
      SBI CARDS
      0.5 3.0/5 "Satisfactory"
      SBI is average on the credit card services. The bank could work on their service and the overall offers and also on the credit limit. When compared to the other banks they could not be recommendable. They could be more proactive and friendly.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Credit Card
      "Excellent services"
      KOTAK MAHINDRA BANK
      0.5 5.0/5 "Blown Away!"
      Kotak Mahindra bank is also good in the credit card services. The offers are good and the credit limit is also excellent. They use their own servers to make a payment and that is very secured. It also works fast. The services and response at the customer care is good.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    • Kotak Personal Loan
      "Good service"
      KOTAK MAHINDRA BANK
      0.5 4.0/5 "Great!"
      The Kotak mahindra executives took around 3week time to disburse my loan amount. The rate of interest which they have offered was high when compared with others banks. The required loan amount was not disbursed and I am not satisfied with the loan amount.
      Was this review helpful? 0
      , hyderabad
      Reviewed on Sep 23, 2017
    • HDFC Bank Saving Account
      "Average"
      HDFC BANK
      0.5 3.0/5 "Satisfactory"
      HDFC Bank is also average in the savings account. I hold a savings account and they could be more professional and the bank will not be recommendable. They are not up to the mark when compared to Kotak Mahindra bank. There are charges involved as well.
      Was this review helpful? 0
      , mumbai
      Reviewed on Sep 23, 2017
    Common Loader Icon
    Page 1 of 50 1 2 3 4 5
  • reTH65gcmBgCJ7k
    This Page is BLOCKED as it is using Iframes.