Urban Money

IDFC RD (Recurring Deposit) Calculator

A Recurring deposit is a healthy savings practice that helps you meet the need for consistent savings for a set period while generating significant returns. In this scheme, the investor usually saves monthly money for a set tenure. You can invest in a recurring deposit from IDFC bank for tenures ranging from 6 months to 10 years. The investment will generate returns based on the investment tenure. To determine the maturity amount of this scheme, interested investors can utilise the IDFC RD Interest Rates Calculator.

The monthly amount to your recurring deposit earns interest on the cumulative deposit every quarter. IDFC bank provides interest rates in accordance with the tenure of investment. This means that according to your needs, you may save for any duration. The IDFC RD calculator helps you determine the right investment amount and tenure to meet your financial needs. You can use the IDFC Bank RD calculator to determine the total amount of interest your investment will garner over time.

What is an IDFC RD Calculator?

The IDFC RD calculator helps investors determine their investment's maturity value based on the applicable interest rate compounded quarterly. Some factors that influence the final maturity amount are the number of deposits, applicable interest rates, compounding frequency, and the investment duration. An interested investor can use the IDFC RD calculator to do the following:

  • Developing an effective recurring deposit scheme investment strategy 
  • Determine the investment duration for which they are planning to hold the investment amount
  • Compare the return on investment at different interest rates to decide on the best option for you
  • Calculate the total maturity value the investor will get at the end of the investment period

How to Use the IDFC RD Calculator?

Below is the step-by-step process for using the IDFC bank RD calculator:

Step 1: Enter the amount you are willing to invest in the recurring deposit scheme monthly.

Step 2: Enter the applicable interest rate.

Step 3: For the third and final step, the investor needs to specify the number of years they want to hold the investment.

Once you have followed all the abovementioned steps, the IDFC RD calculator will display the final maturity amount earned. You can view the total RD investment, total interest accrued, and final maturity amount.

Benefits of Using IDFC Bank Recurring Deposit Calculator

Customers who use the IDFC RD calculator can take advantage of a superior investment strategy and financial quotient. Given below are some of the main benefits of using the IDFC RD calculator:

  • This is a free-to-use digital financial tool that anyone can use to gain a quick understanding of the returns on recurring deposits
  • This calculator can be used by anyone from anywhere in the world
  • You can get accurate results from this calculator, without having to calculate any complicated mathematical values manually. 
  • You do not need assistance from a finance professional to calculate the maturity value of your investment. 

How is the Interest and Maturity Amount on an IDFC RD Calculated?

If the investor wishes to continue with the periodic interest payout option, IDFC bank will transfer the interest accrued at each interval to your bank account. The interest rate remains constant throughout the investment tenure. Unless the scheme is renewed, the principal investment amount is transferred to the bank account upon maturity. When you choose an IDFC bank RD, you will receive credit for the principal amount and the interest accrued upon maturity. All these values can be easily and efficiently calculated using the IDFC RD calculator.

Formula and Example of IDFC Recurring Deposit Calculator

Any interested investor can always use the IDFC RD Calculator to determine the ideal investment tenure and amount to gain the desired maturity amount. However, knowing how exactly the calculator determines these values is also important. Given below is the formula used by the IDFC RD calculator:

M = R[1+in-1]1 - (1+i) - 13

In this formula,

  • R stands for the monthly amount invested, 
  • N stands for the number of quarters,
  • M depicts the total maturity amount,
  • I denotes the applicable rate of interest.

Let’s look at an example to understand this formula better:

Suppose X invests Rs. 5,000 per month for two years at an applicable interest rate of 4.5%. The returns from the investment will be calculated as follows:

M = 4.5[1+50-1]1 - (1+5)-13

The total maturity amount will be Rs 1,25,765

IDFC Bank Recurring Deposit Interest Rates 2022 

The table below depicts the interest rates for an IDFC recurring deposit with effect from July 2022:

Investment Period Applicable Interest Rate
6 months  4.50%
9 months 5.75%
12 months 5.75%
15 months 6.25%
18 months 6.50%
21 months 6.50%
24 months 6.50%
27 months 6.50%
36 months 6.50%
39 months 6.50%
48 months 6.50%
60 months 6.50%
90 months 6%
120 months 6%

Key Highlights of IDFC Recurring Deposits

Given below are some of the key highlights of a recurring deposit from IDFC bank:

  • Attractive Interest Rates

The most beneficial factor of an IDFC RD is the attractive interest rate, which makes it more profitable than a regular savings deposit. The interest rates for an IDFC FD are computed per annum and compounded every quarter.

  • No Penalty

Starting your savings journey with an IDFC FD account has never been more investor-friendly, as they do not charge you a penalty amount for missing an instalment payment.

Further, there are no charges for a premature withdrawal from an IDFC recurring deposit. However, the interest for the latest period will not be credited if you withdraw your deposit prematurely.

  • Start With Nominal Amounts

Even investors with lower income can now build a respectable savings portfolio with an IDFC RD account. IDFC makes this a far more viable option by providing investment options starting at Rs. 100. So you can start your investment journey with an amount you are comfortable with without having to make major changes to your budget.

  • Shorter Tenures

Like the minimum investment amount, you can choose the investment tenure for your RD depending on your financial situation. IDFC First Bank allows you to open an RD account for a period as short as six months, making it an ideal option for short-term investments.

  • Hassle-Free Documentation

If you already have a savings account with IDFC bank, you can invest in an RD account without any additional documentation. This makes the investment process very efficient and hassle-free.

  • Ideal for Short-Term Investments

If you are an investor who has set many short-term investment goals, such as an overseas vacation or upgrading your phone, an RD can be the ideal solution. This is because RD offers significant returns in a short set investment period, with maximum liquidity.

  • Save Via Installments 

Most investors start an FD account when they receive large lump sum amounts. However, this might not be everyone’s cup of tea. If your monthly income and budget result in a lower amount at the end of every month, you can use the extra funds to invest in an RD account. This means you can invest small amounts to eventually accumulate a large amount while also earning interest on the money which otherwise would have laid idle in your account.

Steps to Open an RD Account in IDFC Bank

Any interested investor can start an RD account with IDFC online and offline. Let’s look at both methods:

Offline Method

Step 1: Visit your nearest IDFC branch. Ideally, you should choose the branch where you already have a savings account. All joint applicants must visit the branch if they want to open a joint account.

Step 2: Fill out the application form. Obtain the relevant application form and fill in all the required details like name, address, age, RD amount, investment tenure, contact details, etc. Duly sign and attest wherever required.

Step 3: Submit the necessary documents. Once you have completed the application form, attach all the required documents. You will have to submit documents such as identity proof and PAN Card. To avoid paying TDS, you must submit Form 15G/15H.

Step 4: Make the first deposit. The applicant is required to make the first instalment payment for the RD account. This can be done by cash, cheque, or through online banking.

Step 5: Open your RD account. The authorised representative at the bank will then verify the forms and open your RD account.

Online Method

Step 1: Activate the netbanking facility. Login to your account with the username and password.

Step 2: Select the ‘E-Recurring Deposit’ option from the menu.

Step 3: Fill up the online RD application form. Senior citizens need to check the box which says ‘Senior Citizens’ to get preferential interest rates.

Step 4: Once you have completed all the steps mentioned above, the RD account will be opened, and the amount will automatically be credited on the due date.

Frequently Asked Questions (FAQs)

What is the highest interest rate for an RD from the IDFC first bank?

A recurring deposit from IDFC bank is eligible for the highest interest rate of 6%.

Do senior citizens get preferential interest rates for IDFC RD schemes?

Senior citizens get an additional interest rate of 0.50% on recurring deposits from IDFC bank.

Does IDFC bank allow partial withdrawals from their RD accounts?

IDFC bank does not allow partial withdrawals from their recurring deposits. However, in some cases, the applicant can avail of a loan against the deposit amount in the RD.

What happens if I miss an RD instalment payment?

If you miss an instalment payment, the amount will be deducted whenever the amount is available in the account or on the next due date. IDFC does not charge any penalty for missing an instalment.