Fixed Deposits (FDs) and Recurring Deposits (RDs) are popular investment options by banks and financial institutions. You can safely increase your savings using both. RDs are for regular contributions, whilst FDs are for lump sum investments. Investments in FD and RD are both comparatively low risk. To understand the difference between FD and RD better, you must check out the details I shared below.
Difference Between FD & RD
Here is the diff between FD and RD in India, you must know.
FD | RD |
It involves a one-time lump sum investment for a fixed tenure ranging from 7 days to 10 years. | It is designed for individuals who want to invest small amounts regularly, usually every month, over a fixed period. |
Require a lump sum. | Involve monthly installments. |
Can be withdrawn prematurely with a penalty. | Less flexible because of regular contributions. |
At the end of the tenure, the investor receives the principal amount along with the accumulated interest. | The tenure ranges from 6 months to 10 years. |
FDs generally offer higher interest rates than regular savings accounts, typically ranging between 5% and 7.5% per annum, with senior citizens getting an additional 0.25% to 0.50%. | The interest rate on RDs is usually similar to FDs and is compounded quarterly, leading to a substantial return at maturity. |
I hope you found this helpful.
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What is the Difference Between a Fixed Deposit and a Recurring Deposit?
ruchi
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2025-05-17T15:45:04+00:00 2025-05-17T15:45:05+00:00Comment
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