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Which Is The Best Bank To Open A Recurring Deposit In India?


Recurring deposit is among the favorite investment avenue for those who are looking to save money in a systematic manner. This could be monthly bi-monthly, quarterly or even half yearly.

Which Is The Best Bank To Open A Recurring Deposit In India?
Recurring deposits can be made in the post office as well as banks and through chit funds. When opening a recurring deposit the best bank would be the one in which you get the highest interest rates.

But, most of the interest rate on bank recurring deposits are more or less the same. You can still compare the recurring deposit interest rate and open one. At the moment the private sector banks like Yes bank and DCB offer a slightly higher interest rate.

Most of the public sector banks offer you an interest rate of around 8.25 per cent. DCB offers an interest rate of 8.60 per cent per annum on recurring deposits and so does Yes bank. Please compare recurring bank deposit interest rates before investing, though there is only a marginal difference in the interest rate. It is also imperative to open an account considering other features.

1) Open at the same bank where you have a savings account

It would be ideal to open a recurring deposit account with a bank branch where you already have a bank account.

This will ensure that your account can get automatically debited when you need to pay for the cumulative deposit and also credited accordingly.

2) Consider post office as well

You can consider investing in the post office recurring deposit as well. They offer you an interest rate of 8.4 per cent per annum. Interestingly, you can transfer your account from one post office to the other. Also, go for a post office cumulative account if you have a post office savings account. Interest is compounded every quarter on a post office recurring deposit.

3) Looking for smaller amounts?

If you wish to open very small amounts you can do so in the post office. Amounts begin at Rs 10 per month.


Most of the banks and the post office allow joint nominations and also withdrawal.

4) Study the penalties for default on payments

Also look at the penalty that would be applicable in case you delay paying the recurring deposit amount. It could vary from bank to bank as well as the post office.


It is ideal to open a recurring account where you already have a bank account. Our comparison chart of interest rate on recurring deposits would be helpful for you to scan through the interest rates. You can also look at deposits through chit funds.

Read more about: recurring deposit
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