Recurring deposit (RD) accounts are like special fixed deposit accounts which require you to deposit the investment amount periodically instead of investing the entire amount in one go. So, RDs allow salaried people to enjoy the interest of term deposits by making monthly investments.
Post Office and almost all banks offer RD accounts. To open such an account with the State Bank of India (SBI), first log in to your onlinesbi account and click on e-RD (RD) / e-SBI Flexi Deposit link under the Fixed Deposit tab.
On the page that opens, select e-RD (Recurring Deposit) and click on the “Proceed” button to continue.
It will lead to a page where all your accounts with SBI will reflect. Select the account from which you want to start investing in RD and then enter the amount you want to deposit monthly. If you are a senior citizen, click on the given check box.
After that you have to select the number of years and months for which you want to open the RD account. To know the tenure-wise rate of interest, click on the link “View Interest rate: Domestic term deposit”. The minimum tenure to open an RD account is one year.
To get the maturity amount deposited in your savings account, select “Payback Principal and Interest” option. Otherwise, if you want to convert the maturity amount to FD, select the “Convert to STDR” option.
After going through the terms and conditions, click on the check box given against “I accept the Terms and Conditions” and then click on the “Submit” button.
A page with all the details you have entered will come up with the name of nominee mentioned in the savings bank account. If you want to keep the same person as nominee for your RD account, you have to click on “Yes”, else on “No” against the option “Do you want the nominee/s to be mapped to your term deposit account” and then click on “Confirm” button.
On confirming with same nominee, you will get a page confirming the opening of an RD account with all the relevant details, including rate of interest, maturity date and maturity amount. You may take a print out of the page by clicking on “View/Print” option.
To deposit the monthly amount automatically, click on the “Set SI” option. You will get a page showing from which account the monthly installment will be paid for which account, installment amount, date of payment of the installments each month and number of installments. After checking the details, click on the “Confirm” button to start the auto pay facility.