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Canara Bank offers recurring deposit (RD) schemes that allow the retail customers to deposit savings every month and earn a competitive interest rate over the specified tenure. In addition to monthly instalment payment, the bank also offers a scheme to make daily instalment payments. Here is all that you should know about Canara Bank RD schemes.
The interest rates given in the table below are effective from 27 November 2020.
|Deposit Tenure||Interest Rate for Regular Customers (% p.a.)*||Annualised Yield for Regular Customers (% p.a.)*||Interest Rate for Senior Citizens (% p.a.)*||Annualised Yield for Senior Citizens (% p.a.)*|
|180 days to less than 1 year||4.45||4.52||4.95||5.04|
|1 year only||5.25||5.35||5.75||5.88|
|Above 1 year to less than 2 years||5.20||5.30||5.70||5.82|
|2 years and above to less than 3 years||5.40||5.51||5.90||6.03|
|3 years and above to less than 5 years||5.50||5.61||6.00||6.14|
|5 years and above to 10 Years||5.50||5.61||6.00||6.14|
*Interest rates are subject to change from time to time.
This is the regular RD scheme where you have to make a minimum deposit of Rs.50 per month over the stipulated period to earn interest as applicable. The minimum period for the account is six months and in multiples of three months thereafter. The maximum period is 120 months.
Canara Dhanvarsha – A Flexi RD Scheme:
This scheme is a flexi RD scheme that requires you to make a minimum monthly deposit of Rs.1,000 and in multiples of Rs.100 thereafter. The maximum monthly instalment allowed is Rs.1 lakh. The minimum deposit tenure is one year, and in multiples of three months thereafter. The interest is compounded quarterly in this case.
Nitya Nidhi Deposit Scheme:
The Pigmy Deposit Scheme from Syndicate Bank is merged with New Nitya Nidhi Deposit (NND) Scheme of Canara Bank with effect from 1 April 2020. The scheme intends to collect the small savings of daily savers and includes daily door collection through the bank agents. The minimum contribution per month is Rs.50. The tenure for the account is 63 months. An interest rate of 2.50% p.a. is applicable with effect from 1 October 2020.
Income tax will be deducted at source (TDS) by the bank if the interest earned on the FD and RD accounts across all the bank branches exceeds Rs.40,000 per financial year for regular customers. The limit for senior citizens is Rs.50,000. Note that TDS will be applicable at 10%.
TDS is now reduced from 10% to 7.5% due to the pandemic, effective from May 2020 until March 2021. Submit Form 15G or 15H, as applicable, to request the bank not to deduct tax at source only if your annual income is within the basic exemption limit.
Figure out the returns you can expect with our free RD calculator’s help based on the monthly instalments you can make in an RD account over a certain period.
When it comes to the flexi nature of the monthly deposits, you are allowed to make a deposit of up to 10 times the original instalment amount including the regular instalment for the month.
The initial deposit and the regular monthly instalments are supposed to be received as a debit from NRE SB account or by way of the other approved inward remittances.
In the case of regular RD scheme, a penalty of Rs.1.50 for every Rs.100 instalment per month will be levied for accounts with a tenure of up to 5 years and Rs.2 for every Rs.100 instalment per month for accounts with a tenure beyond 5 years. A delay of more than four months will lead to repayment of simple interest on a monthly product basis.
The maximum amount that can be contributed under the NND scheme is Rs.1,000 per day, i.e. Rs.30,000 per month. With respect to premature closure, the table below gives the necessary details.
|Similar Banks Offering RD|
|SBI Bank||HDFC Bank||ICICI Bank||Indian bank|
|AXIS Bank||KOTAK Bank||Union Bank of India||Canara Bank|
|Bank of Baroda||IDBI Bank||Bank of India||Andhra Bank|
|Central Bank of India||Allahabad Bank||PNB|
|Syndicate Bank||Corporation Bank||RBL Bank|