Top 3 Private Sector Banks Offering 7% Returns On Recurring Deposits For Senior Citizens

Investing in recurring deposits (RD) under the debt investment category is beneficial for risk-averse investors who prefer both capital preservation and secure return. RDs allows investors to deposit a small amount on a monthly basis unlike fixed deposit schemes, which require an investor to deposit a lump sum amount at a single time, allowing them to save regularly for unforeseen financial events. Recurring deposits generally have a flexible duration ranging from 7 days to 120 months to 240 months, and investors will get the principal amount as well as interest when the RD matures. Recurring Deposits do not qualify for tax deductions, however, they are subject to TDS (Tax Deducted at Source) which is deducted at a rate of 10% on interest earned over Rs. 40,000 for regular customers and Rs.50,000 for senior citizens. The rate of interest (quarterly compounded) provided on an RD is the same as the rate offered on fixed deposits, and in the banking industry, three private-sector lenders are presently giving up to 7% interest rates on recurring deposits.

IndusInd Bank

Fixed and recurring deposit interest rates at IndusInd Bank were recently updated. The revised rates go into effect on February 16th, 2022, and the bank now offers a maximum interest rate of 6.50 percent to the general public and 7% to senior citizens on recurring deposits as a result of the modification.

Tenure	Regular interest rate in % p.a.	Senior Citizen Rates p.a.(%)
09 Months	5.5	6
12 Months	6	6.5
15 Months	6	6.5
18 Months	6	6.5
21 Months	6	6.5
24 Months	6.5	7
27 Months	6.5	7
30 Months	6.5	7
33 Months	6.5	7
3 years to below 61 month	6.5	7
61 months and above	6	6.5
Source: Bank Website

Yes Bank

Yes Bank is now offering an interest rate of 4.75 percent to 6.25 percent to the general public on recurring deposits up to Rs 2 crore per month, and 5.25 percent to 7.00 percent to senior citizens on deposits maturing in 6 months to 60 months up to 120 months. These rates are effective from 4th January 2022.

Tenure	Regular interest rate in % p.a.	Senior Citizen Rates p.a.(%)
6 Months	4.75%	5.25%
9 Months	5.00%	5.50%
12 Months	5.75%	6.25%
15 Months	5.75%	6.25%
18 Months	6.00%	6.50%
21 Months	6.00%	6.50%
24 Months	6.00%	6.50%
27 Months	6.00%	6.50%
30 Months	6.00%	6.50%
33 Months	6.00%	6.50%
36 Months	6.25%	7.00%
60 Months upto 120 Months	6.25%	7.00%
Source: Bank Website

RBL Bank

On recurring deposits maturing in 24 months to less than 36 months, RBL Bank is offering an interest rate of 6.50% to the general public and 7% to senior citizens. On February 3, 2022, the bank modified the interest rates on recurring deposits.

Tenure	Regular interest rate in % p.a.	Senior Citizen Rates p.a.(%)
7 days to 14 days	3.25%	3.75%
15 days to 45 days	3.75%	4.25%
46 days to 90 days	4.00%	4.50%
91 days to 180 days	4.50%	5.00%
181 days to 240 days	5.00%	5.50%
241 days to 364 days	5.25%	5.75%
12 months to less than 24 months	6.25%	6.75%
24 months to less than 36 months	6.50%	7.00%
36 months to less than 60 months	6.30%	6.80%
60 months to 60 months 1 day	6.30%	6.80%
60 months 2 days to less than 120 months	5.75%	6.25%
120 months to 240 months	5.75%	6.25%
Source: Bank Website