Established in 1964 as the Industrial Development Bank of India, IDBI was a development financial institution offering financial services to the industrial sector. Today, IDBI Bank is a subsidiary of LIC (Life Insurance Corporation), rendering financial and banking services to consumers. As compared to other services offered, IDBI RD (Recurring Deposit) scheme is one with the lowest risk factors and better interest rates than savings and current accounts.
Recurring Deposit is an investment scheme that allows investors to make regular payments and produce better returns on investment. Opening an IDBI RD account will not only save you money but will reap various benefits in the future. Use the IDBI Bank RD calculator to know how much you save through regular deposits per month with an RD plan.
The calculator computes the total savings amount for a specific deposit for a fixed tenure and interest rate. It will offer you a better insight into how much you will earn upon maturity.
What is an IDBI RD Calculator?
IDBI RD calculator is an online tool that calculates the total savings amount and interest earned on an investment in an RD scheme. The bank provides an attractive interest rate of up to 5.80% on its recurring deposits.
The recurring deposit scheme at IDBI is known as the Systematic Savings Plan (SSP). It helps you to sum up your savings at your complete convenience. With your regular salary, you can begin saving any fixed amount from Rs. 100 to less than two crores per month. Your set amount will automatically be deducted from your savings account every month.
Moreover, IDBI hasn’t fixed any maximum investment amount on an RD. The IDBI RD calculator determines the investment value and the interest earned upon maturity that a user adds. It operates on inputs such as interest rates, RD terms, and monthly deposit amounts.
How to Use an IDBI Bank Recurring Deposit Calculator?
IDBI recurring deposit calculator is an easy-to-use, free, and online calculator. You must enter the desired tenure, monthly deposit amount, and interest rate to get the desired output. Once these values have been added, the calculator will provide you with the total investment amount you stand to attain upon maturity.
Furthermore, the IDBI Bank recurring deposit calculator uses a mathematical formula to compute the investment value upon maturity. Below is an illustration to help you better comprehend the use of the IDBI Bank RD calculator.
Assume that Mr X wishes to invest ₹ 10,000 every month in an IDBI RD scheme for five years. The IDBI recurring deposit interest rate is 5.8%. Hence, you can obtain the following maturity amount on the investment using the IDBI RD interest rates calculator:
You must enter the following inputs in the calculators:
- IDBI RD Interest Rate: 5.8%
- Monthly investment amount: ₹ 1,000
- RD Term: 5 years
The IDBI RD calculator will produce the following outputs:
Total savings = ₹ 69,697
Total investment amount: ₹ 60,000
Interest earned = ₹ 9,697
Therefore, if you make an investment ₹ 60,000 today at an interest rate of 5.8% per annum, the IDBI RD may offer you a return of ₹ 69,697 in five years. The interest earned on the investment would be ₹ 9,697.
What are the Benefits of the IDBI Bank RD Calculator?
IDBI Bank RD calculator offers multiple benefits to its users. Some of them are:
- Saves Time: As the tool can calculate values within seconds, it will help investors save time and effort that may be wasted on complicated manual calculations.
- Accurate Output: One of the significant benefits of the calculator is that it calculates the precise value of the return you will earn on an investment. Moreover, the possibilities for any incorrect values or errors are almost nil compared to manual calculations, which are highly likely to produce inaccurate results due to miscalculations.
- Future Planning: Based on the output provided by the calculator, you can plan your investments. The tool will help you choose a scheme that may be beneficial for meeting your financial objectives.
- Let’s You Compare Different Schemes: The calculator will help you compare different types of RD plans. This will ultimately help you decide on the best investment plan that fits your financial objectives.
- Easy to Use: The IDBI RD calculator is an easy-to-use online monetary tool. You are simply required to fill in the essential inputs. The calculator will do the rest and provide an estimate that a user may gain upon account maturity.
- Free to Use: The bank doesn’t charge you a penny to use this tool.
Hence, you can use it as often as you want to differentiate and calculate various returns on RD investments before you pick the plan that fulfils your needs.
How to Calculate the Maturity Amount and Interest Earned on an IDBI Recurring Deposit?
The bank decides and fixes the interest rate for recurring deposits. Most banks' interest rate on RD typically varies from 5% to 7%. The IDBI bank recurring deposit interest rate varies from 5.6% to 6.55%, depending on the types of citizens and tenure chosen. The interest rate on an IDBI RD account or, for that matter, of any bank is compounded quarterly.
For example, if you create a recurring deposit in April, your RD won’t gain simple interest until June. The interest will be compounded only at the end of June. In other terms, the interest will gain interest.
You might know that the banks have four quarters for an RD investment, which include January to March, April to June, July to September and October to December.
Formula & Example of IDBI Recurring Deposit Calculator
The interest rate under the recurring deposit scheme is determined considering various parameters such as the chosen RD scheme, funds invested, and desired tenure.
The formula below will compute the recurring deposit's maturity amount and interest earned.
M = R [(1+i) n – 1]/ 1 – (1+i) -1/3
In the above formula,
- ‘M’ stands for maturity value,
- ‘n’ stands for the number of quarters,
- ‘i’ stands for rate of interest/400
- ‘R’ stands for monthly instalment
Let us consider an example to understand how this formula works.
Let us assume that you plan to deposit ₹ 10,000 every month in an IDBI RD plan for five years or 60 months. The IDBI RD plan offers an interest rate of 6.55%. Hence, you can determine the maturity and interest earned using the following formula:
M = 15000*[(1+6.50/400)^(120-1)](1-(1+6.50/400)^(-1/3))
M = ₹ 7,10,844
The maturity value you get is ₹ 7,10,844, the interest earned would be ₹ 10,844, and the total investment for 60 months will amount to ₹ 6,00,000.
IDBI Recurring Deposit Interest Rates 2022
We have enlisted IDBI recurring deposits' interest rates in the table below:
|Interest Rate (% p.a.)
|> 1 Year to < 18 Months
|18 Months to < 30 Months
|30 Months to < 3 Years
|3 years to < 5years
|> 5 years to 7 years
|> 7 years to 10 years
Note: The interest rates provided above are as of August 2022 and subject to change in the future.
Significant Features of IDBI Recurring Deposits
IDBI RD plan comes with multiple features. Below are some significant ones:
- The scheme allows you to earn the best interest on investing in the RD scheme for at least five years.
- If you are a senior citizen, you get a chance to earn the highest interest at a maximum of 6.55%.
- IDBI facilitates the RD account opening process with minimal documentation, making the entire procedure hassle-free.
- The bank offers built-in insurance coverage under Group Insurance Accident Insurance Policy.
- You can start a deposit with a minimum amount of ₹ 500.
- The bank doesn’t charge any fee for executing your standard instruction.
How to Open a Recurring Deposit Account with IDBI?
You can open an RD or Systematic Savings Plan account with IDBI Bank using three simple methods, which are as follows:
Phone Banking Method
Call on IDBI’s phone banking toll-free numbers:
- 1800-22-1070 (24x7 service)
Ask the executive to guide you through the account opening process. Once thorough with the procedure, log into the IDBI mobile banking app using your phone banking credentials. Follow the instructions or steps as conveyed by the customer service executive.
Visit the Bank.
Locate the nearest branch of IDBI at apps.idbibank.in/idbiapp/branch-atm.aspx. Ask the concerned official for the RD form. Fill up the application form correctly and submit it with the required documents.
Give a Missed Call
You can also give a missed call on the aforementioned toll-free numbers. One of the service executives will call you at the earliest and guide you through the FD account opening process with IDBI Bank.
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Frequently Asked Questions (FAQs)
Are there any fees for executing standard instructions for RD with IDBI Bank?
IDBI Bank doesn’t charge fees for executing standard instructions pertaining to RD accounts.
What is the least amount you have to pay to open an RD account with IDBI Bank?
The applicant must deposit a minimum amount of ₹ 5000 to open an RD account with IDBI Bank and a multiple of ₹ 100.
Who is eligible for the IDBI Bank Systematic Savings Plan Plus (SSP Plus) recurring deposit scheme?
All individuals, NRO, and NRE, either single or jointly and HUF (Hindu Undivided Family) customers are eligible to apply for the IDBI SSP Plus RD scheme.
Are senior citizens entitled to get any benefits from IDBI bank RD?
Senior citizens receive higher interest rates on the RD than regular citizens.
What is the maximum interest that IDBI Bank offers on its recurring deposit?
The IDBI offers a maximum interest rate of 5.75% for senior citizens and 5.25% for regular citizens on a recurring deposit.
Would you have to pay penalties on your monthly instalment of IDBI RD?
In case of missed payments, you will be penalised. You will have to pay a monthly interest rate of ₹ 12 per ₹ 1,000 or a fraction of it or as may be defined by the Bank for the delayed period.
Does the government levy tax on the interest you earn on bank RD? How?
The government levies 10.3% TDS on the interest earned on your recurring deposit if it exceeds ₹ 10,000. However, no interest will be charged below deposits of ₹ 10,000. Also, 20% TDS will be charged if you fail to provide PAN details to the bank.
Will you get a receipt for the IDBI RD amount deposited?
No, the bank won’t provide you with any receipt. Nevertheless, the interest and deposited amounts will be displayed on the summary page and account statement.
What tenure range does IDBI Bank's recurring deposit scheme offer?
The IDBI Bank RD tenure ranges from 6 months to 10 years.
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