Being one of the largest private sector lenders in India, HDFC Bank is well-known for offering competitive interest rates on a broad range of financial products. When it comes to a Recurring Deposit account, HDFC Bank offers attractive interest rates with a host of benefits. The customers can open an HDFC RD account for a minimum term of 6 months to a maximum of 120 months. An RD account allows the customers to earn interest on the deposited amount at the maturity of the term. The deposits are made on a monthly basis through a standing instruction from the savings account to the RD account. Based on the term of the deposit, customer’s age, and other factors, the customers can earn an interest of 5.75% up to a maximum of 6.80%.
|Term of the Deposit||Interest Rates (Subject to Change)||Interest Rate for Senior Citizens||Interest Rates for NRIs|
Key features of HDFC Recurring Deposits:
- Deposit Amount: An RD account can be opened for a minimum of Rs.1,000 up to a maximum of 14,99,900 as the monthly deposit amount.
- Term of Deposit: The account holder can choose to open an RD account for a term ranging from 6 months to 10 years.
- Switching to Fixed Deposit (FD): At the maturity of the RD account, it can be converted into an FD account.
- Interest Rate: The account holder can earn an interest ranging between 5.75% - 6.00% on the deposit value, senior citizens can earn an additional 0.50%.
- Nomination: The HDFC Netbanking users can add or edit the nominee details instantly.
How to Open an HDFC Recurring Deposit?
The HDFC Netbanking users can open an RD account by following these simple steps:
- Sign in to your account
- Locate Recurring Deposit menu on the left side of the screen
- Click on Open Recurring Deposit
- Choose the amount of deposit
- Choose the deposit term
- Use the drop-down options to complete the details
- Click on Continue to review the details and confirm to complete
- Your RD account details will be displayed on the screen and added to your Netbanking section
- The RD advice will be sent your mailing address within 3 - 4 working days.
How to Liquidate An HDFC Recurring Deposit?
If the account holder decides to close the RD account before the maturity, the following steps can be followed on the HDFC Netbanking section -
- Sign in to your account
- Click on Recurring Deposit menu listed on the left side of the screen
- Click on Liquidate RD
- Choose the RD account number
- Click on Continue
- Review the details and click on Confirm to liquidate
- The details of the RD liquidation will be displayed on the screen
The interest payable on such account will be lower of the base rate for the original / contracted term for which the RD account has been opened. The base rate is the rate applicable to an RD account of less than 1 crore as on the date of opening the account. If the account is closed within a month, no interest is payable apart from the principal amount.
Factors to Consider Before Opening an RD Account:
- Instalments: The instalment amount is chosen by the account holder at the time of opening the RD account which cannot be changed later. HDFC Bank doesn’t accept partial payment of instalment. The bank can close an RD account if more than 6 instalments are overdue. The interest rate on these types of accounts is subject to the premature liquidation policy of the bank.
- Lock-in Period: The RD account comes with a lock-in period of one month. If the account holder opts for a premature liquidation, he/she will only get the principal amount without any interest.
- Maturity: At maturity of the account term, the total earned interest along with the principal amount is credited to the account holder’s funding account provided all the due instalments are cleared. The maturity amount may change due to various factors such as due instalments, premature liquidation, new tax rules, etc.
- Tax Deducted at Source (TDS): The interest earned through an RD account is subject to TDS as per the Income Tax rules.
More you need to know about Recurring Deposit
- Recurring Deposit Interest Calculator
- HDFC Recurring Deposit
- Recurring Deposit
- Compare Recurring Deposit Rates of HDFC Bank with Other Banks and Institutions
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News About HDFC Recurring Deposit Interest Rates
Bulk Deposit Rate Cut By HDFC Bank: Down By 125 BPS to 5%
Interest rates on deposits with maturity dates over a year away and with a value of over Rs.5 crore have been slashed by HDFC Bank by 125 bps (basis points). This will take effect on Friday, and the new interest rate will stand at 5% for such deposits.
Following suit with a number of banks that have reduced deposit rates post demonetization, HDFC has narrowed the differential between its bulk deposit rate with that of the State Bank if India, to 75 bps (previously 200 bps).
Most banks have slashed their effective interest rates on deposits owing to the massive influx of funds following the de-recognition of Rs.500 and Rs.1,000 value currency notes. The total value of deposits (released by RBI) between the 10th of November and the 10th of December, 2016 was reported to be Rs.12.44 lakh crore.
9th January, 2017
HDFC Bank Reduces Interest Rate for Deposits
In news which is likely to impact the savings of thousands of customers, HDFC Bank reduced its interest rate on fixed deposits. The new interest offered by the bank stands at 7% for a one-year term, a cut of 25 basis points. Rates for other tenures have also been reduced, with HDFC now offering 7% interest on two and three-year terms as well. This move could have a huge impact on its customers, for other private banks offer much higher rates, with ICICI and Axis Bank offering 7.25% compared to 7%. A major reason why HDFC chose to reduce rates was to ensure that their margins did not suffer following the RBI rate cut.
The rate cut issued by RBI has reduced the cost of loans, which means that banks will have to resort to other means to maintain parity. The current rate cut has meant that the actual interest is just 0.59% after tax deduction, which could lead to customers opting for other investments.
9th November, 2016