RD Accounts / SIP Accounts
(RD) Recurring Deposit / SIP (Systematic Investment Plan) accounts provide the facility of saving small amounts of money every month to meet future financial goals. The scheme is also called by the name Systematic Investment Plan (SIP). The investment in Recurring Deposit / SIP accounts earn interest at the rates applicable to Time / Fixed deposits for the corresponding period of investment.
These accounts are ideal for investors, who want to plan to save / invest a fixed amount of their income at every month and earn relatively higher interest on their investments for future liabilities like education and marriage of children, purchase /construction of house etc.
Salient features of Bank RD / SIP Accounts
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Usually Recurring Deposit Accounts are maintained by banks for Saving Bank / Current Account holders only.
The Interest Rate is as applicable to Term / Fixed deposit accounts in the concerned bank.
Usually deposits for longer periods attract higher interest rates.
The interest is usually compounded at quarterly rests.
Account holder other than Senior Citizens are not eligible for any exemption.
- A pass book is issued in Recurring Deposit Accounts.
- Delayed payment of monthly installments invite penalties.
- Monthly instalment can be deposited by way of standing instruction from Saving Bank or Current Account.
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