How this calculator works
An RD invests a fixed amount every month at a fixed interest rate. Each month's deposit earns interest for a different length of time, so the maturity value is calculated using the same monthly-compounding approximation used for SIP calculations:
Monthly rate r = Annual rate ÷ 12 ÷ 100. Number of months n = tenure in months.
FV = R × [((1 + r)n − 1) ÷ r] × (1 + r), where R is your fixed monthly deposit.
Total deposited is simply R × n. Interest earned is the difference between the maturity value and the total deposited.
Why the actual bank figure may differ slightly
This calculator uses a standard monthly-compounding formula, the same one used for mutual fund SIP projections. Indian banks, however, often compound RD interest quarterly rather than monthly, using a slightly different calculation internally. Because of this, the maturity amount your bank actually pays out may differ marginally — usually by a small amount — from what this calculator shows. Use this as a close, reliable estimate rather than the exact figure your bank will quote.
Banks may also apply their own rounding conventions and, for RDs opened by senior citizens or under special schemes, different rate slabs. Always confirm the exact maturity value with your bank before relying on it for planning.
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Talk to a CA →What is a Recurring Deposit (RD)?
A Recurring Deposit is a bank savings product where you deposit a fixed amount every month for a chosen tenure, and the bank pays a fixed interest rate on it. Unlike a mutual fund SIP, the return isn't market-linked — the rate is set by the bank at the time you open the RD.
Is this exactly how my bank calculates RD maturity?
Close, but not exact. This calculator uses a standard monthly-compounding approximation, the same formula used for SIP calculations. Banks often use quarterly compounding for RDs, with a slightly different formula — so your actual bank payout may differ marginally from this estimate. Treat this as a close estimate, not the exact bank figure.
Is RD interest taxable?
Yes, RD interest is taxable — same as FD interest. It's added to your total income and taxed at your applicable slab rate, and TDS may apply if the interest earned crosses the threshold set by your bank.
What's the difference between RD and SIP?
An RD is a fixed-rate bank product — you know the interest rate upfront and the bank guarantees it. A SIP invests your monthly amount into a mutual fund, where returns are market-linked and not guaranteed. RDs suit capital safety; SIPs suit long-term growth with market risk.
This tool is for quick estimation only and is not a substitute for professional financial advice. Confirm the exact rate and compounding method with your bank before making a decision.
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