How to open a recurring deposit account

Learn how to open a recurring deposit account
Open an RD account
4 mins
16 July 2024

Opening a recurring deposit (RD) account is a great way to save money and earn interest on it. It is a type of account where you can deposit a fixed amount regularly for a specific period and earn interest on the deposited amount. RD accounts are a popular investment instrument as they offer a relatively high rate of interest when compared to regular savings accounts.

While RDs are excellent for inculcating discipline and building a corpus over time, Fixed Deposit (FD) can be a better option if you have a lump sum to invest. FDs offer competitive interest rates for a fixed tenure and provide easy access to your money upon maturity.

Types of recurring deposit (RD)

  1. Regular recurring deposit account
    As the name suggests, a regular recurring deposit account is a standard recurring deposit account where you deposit a fixed amount every month for a specific period. The minimum deposit amount usually ranges from Rs. 100 to Rs. 500, and the tenure of the deposit is usually between 6 months to 10 years. The interest rate on the deposit varies from one financial institution to another.
  2. Senior citizen recurring deposit
    Senior citizen recurring deposit is a type of recurring deposit account designed specifically for senior citizens. The minimum deposit amount and tenure of the deposit is the same as that of a regular RD, but the interest rate offered is higher.
  3. RD account for minors
    Recurring Deposit (RD) accounts are not just limited to adults, but minors can also open an RD account to save money. The process of opening an RD account for minors is similar to that of a regular RD account, except that the minor cannot operate the account independently. The parent or guardian can open and operate the account on behalf of the minor until the minor reaches the age of majority.
  4. RD for NRI
    Financial institutions also offer options for non-resident Indians to open recurring deposit accounts. NRIs can save money with small monthly investments while earning a reasonable rate of interest. They have the option to invest either through NRE or NRO accounts.

How to open recurring deposit account

Offline application

  1. Visit to the financial institution's branch where you have a savings account.
  2. Fill the recurring deposit (RD) application form, providing information like installment amount, payment mode, deposit tenure, nominee details, and other required information.
  3. Make the initial installment payment using a cheque or cash.
  4. The representative will process your application within the specified timeframe.

Online application

  1. Log in to your account using net banking or mobile app.
  2. Find and click on 'Open an e-RD Account' on the dashboard.
  3. Enter your account number, preferred instalment amount, and duration. Check the interest rate and choose a nominee.
  4. Agree to the terms and conditions by ticking the checkbox.
  5. Submit your application.
  6. You'll see a confirmation message, and an email with the RD receipt will be sent to your registered email address. The specified amount will be debited accordingly.

Benefits of investing in RD

  1. Regular savings habit
    Recurring Deposits help create a savings habit by requiring individuals to deposit a fixed amount regularly. This consistency is essential for building a significant savings amount over time and reaching financial goals.
  2. Stable returns
    RDs provide stable and predictable returns, making them an attractive option for risk-averse investors. The fixed interest rate ensures that individuals can anticipate the growth of their investment over the tenure.
  3. Flexible tenure options
    Investors have the flexibility to choose the tenure of their RD based on their financial goals. With tenures ranging from 6 months to 10 years, individuals can align their investments with short-term or long-term objectives.
  4. Loan facility
    Many financial institutions offer the option to avail loans against RD. This feature provides liquidity to investors during emergencies or financial needs without the necessity of breaking the RD prematurely.
  5. Low-risk investment
    RDs are considered low-risk investment options. Unlike market-linked instruments, RDs are not affected by market fluctuations, ensuring that the invested capital remains secure and steadily grows over time.
  6. Nomination facility
    RD accounts offer a nomination facility, allowing investors to nominate a beneficiary. In the event of unforeseen circumstances, the nominated individual can claim the amount.


Opening a recurring deposit account is a simple and convenient way to save money and earn interest. By following the steps outlined above, you can easily open an RD account in India. It is important to compare the interest rates offered by various financial institutions before taking any decision. With regular deposits you can achieve your financial goals and secure your future.

You can consider both RD and FD to create a well-rounded savings strategy that caters to both your short-term needs and long-term goals.

Frequently asked questions

What is the minimum amount required for a recurring deposit account?

It generally requires a minimum amount of Rs. 100, but it may vary among financial institutions.

What is the minimum duration for an online deposit?

The minimum duration for RD account is 6 months, but it can vary. It's advisable to check with the specific financial institutions before investing.

Is it possible to open a recurring deposit account using Internet banking?

Yes, you can open a recurring deposit account using Internet banking.


As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

For the FD calculator the actual returns may vary slightly if the Fixed Deposit tenure includes a leap year.