Snapshot
Recurring Deposits (RDs) are one of the safest and easiest investment options for individuals who want to save a fixed amount monthly. In 2025, several banks and NBFCs in India are offering competitive RD interest rates ranging from 6.50% to 8.50% p.a. Choosing the right RD scheme can help you grow your money with minimal risk.
This article is your quick and easy guide to the best RD interest rates in 2025. It compares top banks and NBFCs offering rates between 6.50% and 8.50% p.a., helping you choose the right recurring deposit scheme to grow your savings safely. With expert tips, comparison tables, and RD calculators, it’s designed to make smart investing simple—whether you’re just starting or planning for long-term returns.
What is a Recurring Deposit (RD)?
A Recurring Deposit is a savings scheme where you deposit a fixed amount every month for a pre-decided period. In return, the bank pays you interest at a fixed rate.
Key Features:
- Monthly deposits (starting from as low as Rs. 100)
- Fixed interest rate
- Tenure: 6 months to 10 years
- Safe and low-risk
- Ideal for salaried individuals and beginners
Note: Interest earned is taxable as per your income slab.
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Top 8 RD Interest Rates in India – July 2025 (Latest)
| Bank/NBFC | Regular RD Rate (% p.a.) | Senior Citizen RD Rate (% p.a.) | Tenure |
|---|---|---|---|
| SBI | 6.50% | 7.00% | 1 to 10 years |
| HDFC Bank | 7.00% | 7.50% | 6 months+ |
| ICICI Bank | 7.10% | 7.60% | 1 to 10 years |
| Axis Bank | 7.05% | 7.55% | 6 months+ |
| IDFC First Bank | 7.50% | 8.00% | 6 months+ |
| Kotak Mahindra Bank | 7.30% | 7.80% | 6 months+ |
| Bajaj Finance | 8.10% | 8.50% | 1 to 5 years |
| Mahindra Finance | 7.90% | 8.40% | 1 to 5 years |
Fact Flash ⚡: NBFCs like Bajaj Finance offer higher interest but are less liquid than bank RDs.
How to Choose the Best RD Scheme in 2025
Consider these factors:
- Interest Rate: Higher rate = more return
- Tenure: Choose based on your goals
- Bank/NBFC Safety: Prefer reputed and AAA-rated institutions
- Payout Frequency: Usually, interest is paid on maturity
- Premature Withdrawal Rules: May include penalties
| Factor | What to Look For |
| Rate of Interest | 7% or more for best returns |
| Institution Safety | AAA rating, RBI-regulated |
| Tenure Flexibility | From 6 months to 10 years |
| Lock-in/Penalty Rules | Low or no penalty on early withdrawal |
| Digital Accessibility | Easy to open/manage via mobile app or net banking |
Fact Flash ⚡: Always calculate post-tax returns using an RD interest calculator before investing.
RD Returns Calculator: Estimate Your Maturity Amount
Formula used:
A = P × (n(n+1)/2) × r/1200
Where:
- A = maturity amount
- P = monthly deposit
- n = number of months
- r = annual rate of interest
Example:
- Monthly deposit: Rs. 5,000
- Tenure: 3 years (36 months)
- Interest Rate: 7.5%
Estimated Maturity = Rs. 2,00,250 approx.
| Monthly Deposit | Tenure | Interest Rate | Maturity Value (Approx.) |
| Rs. 1,000 | 2 years | 7.0% | Rs. 26,100 |
| Rs. 5,000 | 3 years | 7.5% | Rs. 2,00,250 |
| Rs. 10,000 | 5 years | 8.0% | Rs. 7,50,000+ |
🧮 Note: Use your bank’s RD calculator for exact figures.
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Special RD Schemes for Senior Citizens
Senior citizens enjoy 0.50% extra interest in most banks. Some banks even offer dedicated RD schemes for them.
Best RD Interest Rates for Seniors – July 2025
| Bank | Senior RD Rate | Max Tenure |
| Bajaj Finance | 8.50% | 5 years |
| IDFC First Bank | 8.00% | 10 years |
| SBI | 7.00% | 10 years |
Fact Flash ⚡: Opt for 3-5 year tenure for higher compounding benefits.
Bank vs NBFC: Where to Open an RD in 2025?
| Feature | Banks | NBFCs |
| Interest Rate | 6.5% – 7.6% | 7.5% – 8.5% |
| Safety | Very High (RBI-regulated) | High (check credit rating) |
| Liquidity | High | Moderate |
| Tenure | Up to 10 years | Up to 5 years |
| Online Access | Yes | Yes |
Fact Flash ⚡: Always check the credit rating of NBFCs before investing.
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Documents Required to Open an RD
- PAN Card
- Aadhaar Card
- Passport-size Photo
- Bank Account details
- Mobile number linked with Aadhaar
📌 Note: Most banks allow online RD opening through internet banking or mobile apps.
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Final Tips for RD Investment in 2025
- Start early to take advantage of compounding
- Compare at least 5 banks/NBFCs before finalising
- Use auto-debit to avoid missed payments
- Consider taxation (interest is fully taxable)
📌 Pro Tip: For tax-saving options, consider PPF or 5-Year Tax Saver FD instead of RD.
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Conclusion
Recurring Deposits in 2025 continue to be one of the best low-risk investments for salaried individuals and risk-averse investors. With interest rates touching up to 8.50%, there is real potential to grow your savings steadily. By choosing the right bank or NBFC and tenure, you can maximise returns and meet your financial goals.
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Frequently Asked Questions (FAQs)
Bajaj Finance offers up to 8.50% for senior citizens.
Yes, the interest is fully taxable as per your income tax slab.
Yes, but banks may levy a penalty and reduce interest.
You can start with as low as Rs. 100 in many banks.
In RD, you deposit monthly. In FD, you deposit a lump sum amount.
Yes, if you invest with reputed NBFCs with AAA ratings.
Yes, almost all banks and NBFCs offer online RD opening.
Banks may charge a penalty or reduce the interest rate.
Long-term RDs offer better compounding and higher interest.
Yes, most banks offer 0.50% extra interest to senior citizens.
