RD Calculator
Compute a recurring deposit's maturity value using the standard quarterly-compounded RD formula.
- Invested
- Value
- Invested
- ₹3.00L
- Interest earned
- ₹59.66K
Assumes a constant 7% annual rate, compounded quarterly (the standard RD convention).
Independent · No commissions · No fund-house data — how the numbers are computed
How it works
A recurring deposit (RD) is the instalment version of a fixed deposit: you deposit a fixed amount every month for a chosen tenure, and every instalment earns the rate contracted when the account was opened. Indian banks compound RD interest quarterly, the same convention as cumulative FDs, and post offices run a 5-year RD on identical mechanics.
This calculator computes the maturity value using the standard Indian-bank RD formula with quarterly compounding. The rate defaults to 7% — representative of bank RD rates, and fully editable since each bank sets its own — with the tenure set in months (default 60, i.e., 5 years) because banks quote RD tenures that way.
An RD earns less than an FD of the same rate and tenure — not because the rate differs, but because each month's instalment is invested later and compounds for less time. The first instalment earns interest for the full term, the last for barely a month; the maturity value is the sum of all of those.
M = R × [(1+i)^n − 1] / [1 − (1+i)^(−1/3)]R is the monthly instalment, i the quarterly rate (annual rate ÷ 4) as a decimal, and n the number of quarters in the tenure. This is the standard Indian-bank RD maturity formula with quarterly compounding — equivalent to summing each monthly deposit compounded for its own remaining time.
Frequently asked questions
How is RD interest calculated?
Indian banks compound RD interest quarterly. Each monthly instalment starts earning from its deposit date and compounds every quarter until maturity, so earlier instalments earn more than later ones. The standard maturity formula is M = R × [(1+i)^n − 1] / [1 − (1+i)^(−1/3)], where R is the monthly instalment, i the quarterly rate and n the number of quarters — the formula this calculator uses.
Is RD interest taxable?
Yes, exactly like FD interest — it is added to your income and taxed at your slab rate. RD interest also counts toward the TDS threshold: banks deduct 10% TDS when your total interest at that bank crosses the annual limit (₹50,000 for most depositors, ₹1 lakh for senior citizens from FY 2025-26). RDs carry no Section 80C benefit.
What happens if I miss an RD instalment?
Banks charge a small penalty per delayed instalment — commonly quoted per ₹100 per month of delay, with the exact figure set by each bank. Repeated defaults can get the RD discontinued and converted to an ordinary deposit for the amount already paid. Post-office RDs allow a defaulted account to be revived within a window by paying the arrears plus the default fee.
Can I withdraw an RD before maturity?
Yes, RDs can be closed prematurely, on FD-like terms: the bank pays interest at the rate applicable to the period the deposit actually ran, minus a penalty typically around 0.5–1%. Partial withdrawal is generally not allowed — closure is all-or-nothing — though post-office RDs permit one loan of up to 50% of the balance after a year of regular deposits.
How is an RD different from a SIP?
Both invest a fixed amount monthly, but an RD earns a contracted, guaranteed interest rate from a bank, while a SIP buys mutual-fund units at market prices, so its value fluctuates and its return is not guaranteed. RD interest is taxed yearly at slab rates; fund gains are taxed only on redemption, under capital-gains rules. RDs suit short, certain goals; SIPs accept volatility in exchange for potentially higher long-term returns.
Go further
The lump-sum version — same quarterly compounding, one deposit.
The market-linked monthly habit an RD is most often compared with.
Why monthly investing behaves differently in funds than in deposits.
The guaranteed-versus-market-linked trade-off behind the RD/SIP choice.