Indian Bank RD Interest Rates

About Indian Bank Recurring Deposit

Indian Bank recurring deposits RD allow investors to invest in small amounts regularly for a fixed tenure. The Indian Bank recurring deposit rate ranges between 5.5% to 6.70% p.a. for regular citizens. For senior citizens, the RD interest rates range between 6% to 7.20% p.a. Also, the Indian Bank recurring deposit interest rates are higher than their saving account rates.

Indian Bank RDs have interest rates that range between 5.5% to 6.70% p.a.. for a tenure of 6 months to above 5 years. Also, for senior citizens, the interest rates range between 6% to 7.20% p.a.. Indian Bank offers additional interest rates to senior citizens on their RD investments. Also, the Indian Bank recurring deposit interest rates are higher than their saving account rates. Indian Bank pays interest on the minimum balance between the 10^th day and last day of the month. Furthermore, one can estimate the returns from Indian Bank RDs using an Indian Bank RD Calculator. Also, Indian Bank RD interest rates are dependent on the age of the investor, tenure of the investment, RBI policies and current economic condition in the country.
Furthermore, interest income from Indian Bank RDs is taxable as per the individual investor’s income tax slab rates. Investors have to file the interest income under the head ‘Income from other Sources’ while filing their income tax returns. Moreover, Indian Bank deducts a TDS of 10% if the interest income exceeds INR 40,000 (INR 50,000 for senior citizens). Also, Indian Bank cuts 20% if the investor doesn’t submit PAN Card details.

Indian Bank RD Features

Following are the key features of Indian bank recurring deposits:

• Tenure: The Indian Bank recurring deposit tenure ranges between 6 months to 120 months.
• Minimum and Maximum Deposit Amount: The minimum amount of investment in Indian bank recurring deposits RD is INR 100 and in its multiples thereafter. Also, the scheme has no limit on the maximum investment amount.
• Tax and TDS: Indian bank RD schemes do not qualify for tax saving. The interest income from Indian bank RDs is taxable as per investor’s income tax slab rates. Moreover, the Indian bank deducts a TDS of 10% if the interest income per annum exceeds INR 40,000 (INR 50,000 for senior citizens). The 10% TDS rate is applicable when the PAN details are submitted, else the bank charges TDS at 20%.
  Also, one can determine whether Indian bank recurring deposit interest income is above or below the TDS threshold limit using the RD calculator. Furthermore, one can estimate income tax liability with the help of Scripbox Income Tax Calculator.
• Premature withdrawal: The Indian bank allows investors to prematurely withdraw their recurring deposits. However, it attracts a penalty.
• Nomination Facility: Depositors can nominate beneficiaries for their Indian Bank RDs.
• Convenience: Opening and managing the recurring deposit investments is easy and also convenient through the Indian Bank’s online portal.
• Loan against RD: The Indian bank allows investors to take a loan against recurring deposits. Furthermore, this enables them to meet their liquidity requirements. Moreover, the hassle of applying for a new loan is eliminated.
  Investors can take loans such as home loans (loan against property), motor loans, education loans, etc., against Indian Bank recurring deposits. Also, individuals can compute their loan EMI using the loan EMI calculator. Furthermore, the loan EMI calculator works as a home loan calculator, car loan calculator, and personal loan EMI calculator. Moreover, the investor can use the EMI calculator for comparing various scenarios by changing the variables such as interest rate.

Types of Indian Bank Deposit Schemes

Indian offers the following recurring deposit schemes:

Recurring Deposit

It is a regular monthly savings scheme that has the capability to grow into a large sum. This helps investors in meeting their financial goals and also needs at the end of the investment tenure.

• Tenure: 6 months to 10 years (in multiples of 3 months)
• Minimum Deposit Amount: INR 100 and in its multiples thereafter
• Maximum Deposit Amount: No limit. However, no single deposit is allowed in a day for more than INR 2 crore, within the overall limit of INR 10 crore tagged to a single CIF.
• Nomination Facility: Available
• Tax Deducted at Source: Applicable
• Loan Facility: Available
• Premature closure: Available, however, attracts a penalty.

Variable Recurring Deposit

The variable recurring deposit scheme comes with the option of varying monthly instalments.

• Tenure: 36 months
• Initial Deposit Amount: INR 500 and in multiples of INR 100 thereafter, up to a maximum of INR 1,00,000.
• Maximum Deposit Amount: INR 10,00,000 per month.
• Nomination Facility: Available
• Tax Deducted at Source: Applicable
• Loan Facility: Available
• Premature closure: Available, however, attracts a penalty.
• Delayed instalments: No penalty for delay in instalments

Indian Bank RD Account Eligibility and Documents Required

To be able to open an Indian Bank RD account, one has to be eligible. Following is the eligibility for investing in Indian Bank RD:

• Resident individuals, including minors
• Non-resident individuals,
• HUFs

Documents required

Following are the documents required to invest in Indian Bank RDs:

• Identity proof – Driving License, Voter ID, Aadhar Card, PAN Card, Senior Citizen Card, and any Government ID card.
• Residence proof – Passport, Utility Bills, Bank statement with cheque, and the certificate is given by Post Office.

Tax Liabilities on Indian Bank Recurring Deposit

Investment in Indian Bank RDs is not eligible for tax deduction under Section 80C of the Income Tax Act, 1961. Moreover, the Indian RD interest income is taxable as per the investor’s income tax slab rates. Furthermore, investors of Indian Bank RD have to show their interest income under the head ‘Income from Other Sources’.

Also, the interest income is subject to TDS. The Indian Bank cuts TDS based on whether the investor has disclosed the PAN details or not.

If the investor submits the PAN Card details to Indian Bank, then the applicable TDS rate is10%. Also, Indian Bank cuts TDS if the interest income exceeds INR 40,000 for regular citizens and INR 50,000 for senior citizens.

If the investor doesn’t submit the PAN Card details, then the applicable TDS rate is 20%. Also, Indian Bank cuts TDS if the interest income exceeds INR 40,000 for regular citizens and INR 50,000 for senior citizens.

Requirements of Indian Bank RD Scheme

• Deposit and account: One can open an Indian Bank RD account with a minimum investment of INR 5. Also, there is no upper limit for Indian Bank RD. Furthermore, for Indian Bank variable recurring deposit schemes, the bank will not charge any penalty if the instalment payments are delayed.
• Withdrawal: Indian Bank allows investors to prematurely withdraw their RD investments. For deposits (less than INR 5 lakhs) held for a tenure of 181 days, the bank will not charge a penalty. However, if the deposits are held for less than 181 days, then the bank will charge a penalty of 1% on the interest amount. Also, for all deposits above INR 5 lakhs, the bank will charge a penalty of 1% on the interest if the investment is prematurely withdrawn.
• Nomination: Indian Bank allows investors in RD to nominate a beneficiary from the family to receive the final amount.

Can I open a recurring deposit account for a minor in Indian Bank?

Yes, a minor can open Indian Bank recurring deposit account, however under the guardianship of their parents or legal guardian.

Is it possible to renew an RD account in Indian Bank?

No, it is not possible to renew an Indian Bank RD account.

Conclusion

Indian Bank RDs are considered as a good investment for investors who want to save a small amount of money regularly. Through Indian Bank RDs, investors can invest monthly in the scheme. Since Indian RD scheme guarantees income at the time of maturity, it is a low-risk investment. Hence investors who are looking for guaranteed returns form their investment, can invest in Indian Bank recurring deposits. However, they have to take into consideration the tax that they have to pay on the interest income from Indian Bank RDs.

Resources

1. Indian Bank Fixed Deposit
2. Indian Bank FD Calculator
3. Indian Bank Savings Account