The Post Office Recurring Deposit (RD) Scheme is one of the most trusted saving plans in India, loved by millions for decades. It’s designed especially for individuals who wish to build a secure fund by depositing small amounts every month, while earning a steady interest.

Currently, the Post Office RD offers an attractive interest rate of 6.7% per annum, compounded quarterly. The minimum amount you can deposit is ₹100 per month, or any amount in multiples of ₹10. There is no upper limit, making it flexible for all income levels.

Who Can Open an RD Account?

An RD account at the Post Office can be opened by:

• A single adult.
• Joint account holders (up to three adults, either Joint A or Joint B).
• A guardian on behalf of a minor.
• A guardian for a person of unsound mind.
• A minor above 10 years of age, in their own name.

You can open multiple RD accounts if you wish.

How to Make Deposits

• You can open an RD account through cash or cheque. For cheques, the date of deposit will be the date the cheque is cleared.
• The minimum monthly deposit is ₹100, and you can increase this in multiples of ₹10.
• If you open the account on or before the 15th of the month, subsequent deposits should be made by the 15th of every month.
• If you open the account after the 15th, deposits must be made by the last working day of each month.

What Happens in Case of Default?

• If you miss a monthly deposit, a default fee applies — ₹1 for every ₹100 denomination (proportional for other amounts).
• To continue, you must first pay the missed installment plus the default fee, then pay the current month’s deposit.
• If you miss 4 consecutive deposits, your account becomes discontinued, but you can revive it within 2 months from the fourth default. After that, no further deposits are allowed if not revived.
• If there are up to 4 missed deposits, you may extend the maturity period by the number of missed months and pay the pending installments during that extended period.

Advance Deposit Option

• You can pay your RD installments in advance for up to 5 years.
• A rebate is available for advance deposits — for a ₹100 denomination, you get a rebate of ₹10 for 6 advance installments or ₹40 for 12 installments.
• Advance deposits can be made at the time of opening or anytime later.

Loan Facility

• After you deposit 12 installments and the account runs for at least 1 year (without discontinuation), you can avail a loan up to 50% of the balance.
• The loan can be repaid in a lump sum or in monthly installments.
• The loan interest rate is 2% higher than the RD interest rate and is calculated from the withdrawal date to the repayment date.
• If you do not repay the loan before maturity, the loan plus interest will be deducted from the maturity amount.
• To apply, submit the loan application form along with your passbook at the Post Office.

Premature Closure

• You can close your RD account after 3 years from the date of opening by submitting the prescribed form.
• If you close the account prematurely, you will receive interest as per the Post Office Savings Account rate — even if the account is closed just one day before maturity.
• Premature closure is not allowed during the period for which advance deposits have been made.

Maturity & Extension

• The standard RD account matures after 5 years (60 monthly deposits).
• You can extend the account for another 5 years at the same interest rate applicable when the account was opened.
• An extended account can be closed anytime during the extended period. For completed years, the RD rate applies; for a partial year, the Savings Account rate applies.
• You can also keep the account for up to 5 years after maturity without making further deposits.

Repayment in Case of Death

• If the account holder passes away, the nominee or legal heirs can claim the balance by submitting the required documents at the Post Office.
• The nominee or legal heirs may also continue the RD account till maturity by applying at the concerned Post Office.

👉 Check out our RD Calculator

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💡 The Post Office RD Scheme is a safe, government-backed way to develop a habit of regular savings. Small monthly contributions can lead to a significant corpus at maturity, helping you achieve your financial goals with ease.