The Recurring deposit account is an account where an investor deposits a fixed amount of money every month for a fixed tenure (mostly ranging from one year to five years). This scheme is meant for investors, particularly for fixed income group, who want to deposit a fixed amount every month, in order to get a lump sum after certain conveniently fixed period. The small monthly savings in the Recurring Deposit scheme enable the depositor to accumulate a handsome amount on maturity. Interest at term deposit rates is computable on quarterly compounded basis. Longer the period for which monthly deposits are agreed to be made higher is the rate of interest.
This is an ideal plan to cultivate the habit of regular savings. Monthly regular saving builds a good corpus to provide for your short Term as well as long Term financial requirements.
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