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How to Open Recurring Deposit RD Account 2026
RD Account - ₹100/month minimum. Compound interest. 5-year typical. Tax saving option (5-year RD).
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About This Guide
Recurring Deposit (RD) - regular monthly savings with fixed interest. Min ₹100/month at post office, ₹500-1,000 at banks. Tenure: 6 months to 10 years. Interest 6.5-7.5% (current). Compound calculation. 5-year RD eligible for 80C tax deduction (post office). TDS applicable beyond ₹40K interest/year.
Eligibility Criteria
- Indian resident
- Adult OR minor with guardian
- Aadhaar mandatory
- PAN
- Bank account
- HUF eligible
Documents Required
Keep these documents ready before starting application. Missing documents = delayed approval.
- Aadhaar
- PAN
- Photo
- Bank passbook (existing)
- Initial deposit (₹100+)
- Address proof
- Form 15G/H (no TDS preference)
Step-by-Step Application Process
Follow these steps in order. Each step is critical - skip none.
Choose Institution
Post Office or any bank.
RD Application Form
Available.
KYC + Documents
Aadhaar + PAN.
Tenure + Amount
Min ₹100/month at PO. ₹500+ at banks.
Standing Instruction
Auto-debit setup from existing bank.
Monthly Auto-Debit
On chosen date.
Maturity
Lump sum + compound interest.
TDS at Source
Form 15G/H to avoid (eligible).
Key Benefits
- Discipline savings
- Compound interest
- ₹100/month accessible
- Multiple tenures
- 5-year tax-saving option
- Government-backed (PO)
- Loan against RD
- Premature closure allowed (with penalty)
What Happens After Application?
Account active immediately.
Frequently Asked Questions
Best place?
Post Office: highest interest typically + ₹100 entry. Banks: convenience + branches.
Tax saving 5-year RD?
Post Office 5-year RD: Section 80C eligible up to ₹1.5L. Bank 5-year RD: similar. Verify with bank.