Axis Bank RD Calculator
Axis Bank RD calculator is a simple online tool available for free. One can use it to estimate the interest and RD maturity amount. In this article, we have covered the Axis Bank RD calculator and its interest calculation in detail.
Recurring Deposit Calculator
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What is an Axis Bank RD Calculator?
Axis Bank RD calculator is an online tool that helps to estimate the interest earned by investing in a recurring deposit scheme. For RDs, the maturity amount is the sum of monthly investments and the interest earned during the investment period. Also, for recurring deposits, the interest compounding is every quarter.
Axis bank offers multiple schemes for varying tenures. Also, one can choose between tenures ranging between six months to 120 months. The minimum amount for Axis Bank RD investment is INR 10, and there is no maximum limit.
The Axis Bank RD calculator determines the interest and the value of the investment at a future date. The recurring deposit calculator is easy to use the tool, and works on the following inputs:
- Monthly deposit amount: Monthly investment amount in a recurring deposit account.
- Interest rate: The interest income that a recurring deposit investment earns. Axis bank determines the recurring deposit interest rates. The rate of interest in recurring deposits for different banks is available online.
- RD term: The tenure of the recurring deposit investment (in years).
On entering the above details in the RD calculator, it computes the following results:
- Total investment: Sum of monthly deposits in the scheme.
- Wealth Gained: Interest income from the recurring deposit investments.
- Total Corpus created: Sum of monthly investments and the wealth gained. In other words, it is the maturity amount that one receives from their RD investments.
How to use an Axis Bank RD Calculator?
The Axis Bank RD calculator is available online for free. It is easy to use and simple tool. One has to just enter the details such as monthly deposit amount and Axis Bank recurring deposit rate to determine the maturity value. The calculator helps in calculating the wealth created from an investment. Furthermore, the Axis Bank RD calculator uses the future value formula to determine the investment's maturity value. The following example helps in understanding the Axis RD calculator better.
Mr Ram plans to invest INR 30,000 per month in a recurring deposit scheme for seven years. The Axis Bank recurring deposit rate is 6.50%. The maturity value of the investment for Mr Ram using the Axis bank RD calculator is:
The following are the Axis Bank recurring deposit RD Calculator inputs:
- Monthly investment amount: INR 25,000
- Axis Bank Recurring Deposit Interest Rate: 6.50%
- RD Term: 7 years
On entering the above inputs, the RD calculator displays the following:
- Total Investment: INR 21,00,000
- Wealth Gained: INR 5,61,175
- Total Corpus Created: INR: 26,61,175
The investment of INR 21,00,000 made today at 6.50% interest per annum would be INR 26,61,175 in seven years. The interest income for Mr Ram will be INR 5,61,175.
Benefits of using an Axis Bank Recurring Deposit Calculator
The following are some of the benefits of using the Axis Bank recurring deposit RD calculator:
- Simple and easy to use: The calculator is a simple tool that requires one to input a few details to estimate potential returns.
- Saves time: The calculator computes the results faster, helping individuals from performing complex calculations.
- Accurate results: It provides accurate results, and also the chance for error is low.
- Comparison: One can use the RD calculator to compare various recurring deposit schemes. Also, the comparison helps in shortlisting a scheme that benefits the investor the most.
- Future planning: The Axis bank calculator estimates the returns from an investment, and helps in better financial planning. Also, estimating returns help in planning their investments and goals in a better way.
- Free to use: The calculator is an online tool that one can use multiple times to compute and also compare returns from different recurring deposit investments.
How is interest and maturity amount on an RD calculated?
Banks set the RD interest rates and these range between 5%-7% for most of the banks. The interest in RDs is compounded every quarter, and the investor will earn simple interest during the quarter. For example, if an investor invests in an RD in the month of July, the RD will earn simple interest until September. At the end of September, the interest will earn interest. In other words, the interest is compounded at the end of September. The quarters for RD investment are April to June, July to September, October to December, and January to March.
The formula for RD interest rate and maturity value
One can calculate Axis Bank RD maturity amount and interest earned using the formula below.
Where M is the RD maturity value
R is the monthly instalment. It is the amount the investor wants to invest on a monthly basis.
n = investment horizon in quarters. It is the number of quarters the investor wants to stay invested.
i = interest rate/400. The Axis Bank sets the interest rate on Axis Bank RD under RBI guidelines.
Mr Sohil wants to invest a monthly instalment of INR 50,000 in an RD scheme for a tenure of 3 years or 36 months. The interest rate offered by the scheme is 6.5%. Mr Sohil can calculate Axis Bank RD interest and maturity amount using the following formula.
M = 50000*[(1+6.5/400)^(36-1)](1-(1+6.5/400)^(-1/3))
M = 19,91,219
For a total investment of INR 18,00,000. The interest earned is INR 1,91,219, and the maturity value is INR 19,91,219.
Current Axis RD interest rates
Current Axis Bank RD interest rates are given in the table below.
|Tenure||General Recurring Deposit Interest Rates||Senior Citizen Recurring Deposit Interest Rates|
|1 year 11 days to 12 months 29 days||6.40%||6.90%|
|9 months to 364 days||6.05%||6.55%|
|1 year to 17 months 29 days||6.40%||6.90%|
|18 months to 10 years||6.50%||7.00%|
Note: Axis Bank RD rates are subject to change periodically
Axis Bank RD interest rates are higher than their savings account rates. The interest on Axis Bank RDs is compounded every quarter. Also, Axis Bank will pay the investment and interest amount upon maturity. Axis Bank sets the Axis RD rates.
Below are the factors affecting Axis Bank RD interest rates
- Investment horizon: The tenure of the investment affects the RD interest rates. The higher the tenure, the more is the RD interest rate.
- Age of the investor: Axis Bank pays an additional 0.5% interest on its RDs to senior citizens. Hence age is one of the deciding factors for RD interest rate.
- Economic condition: Axis bank RD rates depend on the repo rates and inflation rate in the economy.
What are the documents required to open an RD account in Axis Bank?
For opening an RD account with Axis bank, following is the list of documents required:
- Account opening form
- Recent passport size photograph
- KYC Documents
- For Company & Individual: PAN Card, Voter's ID, Aadhar Card, Passport Copy, and Driving License
- HUFs: HUF declaration deed, self-attested PAN card, and HUF’s bank statement
- Partnership Firms: Certificate of Incorporation, Partnership deed, and ID proof of the partners.
However, to invest in an Axis bank recurring deposit, one has to meet the eligibility criteria. Following is the eligibility criteria to invest in Axis Bank Recurring Deposit is:
- Resident Individuals
- Non-Resident Indians (NRIs) and Persons of Indian Origin PIOs
- Sole proprietorship firms
- Trusts and companies
- Partnership Firms
- Public and Private Limited companies
Frequently Asked Questions
What is the highest RD rate for Axis Bank?
The highest interest rate on Axis Bank RD is 6.5% for a tenure of 18 months-10 years. Also, for the same tenure, Axis Bank offers senior citizens an additional 0.5% interest. Hence the highest Axis Bank RD interest rate for senior citizens is 7%.
How are RDs taxed?
Investment in Axis Bank RD schemes does not qualify for tax saving under Section 80C of the Income Tax Act. Furthermore, the interest income is taxable as per the individual's income tax slab rates. Moreover, the interest from Axis Bank RDs is subject to TDS of 10%. This rate is applicable if the interest income exceeds INR 40,000 (INR 50,000 for senior citizens). In case, the investor doesn't submit the PAN Card details. The TDS rate will be 20%. Also, one can estimate their tax liability using an income tax calculator.
Is there a Premature withdrawal facility of recurring deposits available with Axis Bank?
Axis Bank allows investors to withdraw their RD investment prematurely. However, they charge a penalty for premature withdrawal. Also, the penalty is in the form of interest. Investors will receive 1% less interest on the contracted interest rate.
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