Canara Bank RD Interest Rates -Open RD Account Online

With an unbroken record of profitability, Canara Bank is one of the best banks to offer a wide range of popular services to its customers. One of the services that this bank offers is recurring deposit. Canara Bank RD interest rates are one of the best in the market and this encourages people from all sectors to invest their earnings in it. Recurring deposit is a safe and secure option in which you can invest small amounts on a month-on-month basis and build up the habit of savings. 

Canara Bank RD Interest Rates 2024 

Canara Bank RD rates are generally favourable for individuals who want to diversify their portfolio with a safe investment option. Moreover, like most other banks Canara Bank RD rates are more if the investor is a senior citizen. Here are the interest rates applicable for Canara Bank RDs for general and senior citizens: 

* Interest rates may change from time to time. 

Features of Canara Bank Recurring Deposit Interest Rates

By opting for Canara Bank recurring deposit you can take advantage of all the features it offers along with the Canara Bank RD rates: 

• You can start your investment journey with a minimal amount of ₹50 per month only. 
• There is no ceiling on the maximum amount you can invest as instalments, but it should be in multiples of ₹50 (if it is your primary investment). 
• You have to keep the principal growing for a minimum of 6 months. Generally the longer you invest for the better will be the Canara Bank RD rates. 
• Canara Bank RDs comes with a nomination facility. 
• You can opt for the loan against RD facility. The loan cannot however be more than 90% of the total amount. 
• As per Income Tax rules, TDS may apply to the earned money. 

How to Open Canara Bank RD Account Online?

You can open an RD account online via Net Banking very easily. Follow these steps to avail of benefits that come with Canara Bank RD rates: 

• Step 1: If your Net Banking account is not active, activate it by filling up the Net Banking activation form at the Canara Bank branch. 
• Step 2: Use your username and password to log into your Net banking account. 
• Step 3: From the menu find out and select the ‘E-Recurring Deposit’ option. 
• Step 4: You will find an RD form. Fill up the form with all the crucial information like tenure and amount. If you are a senior citizen check the box that wants senior citizen confirmation and provide supporting documents. 
• Step 5: After the successful opening of the bank account the bank will automatically credit the pre-fixed fund from your savings account to your RD account. 

How to Open Canara Bank RD Account Offline?

Follow the steps we mention below to open your Canara Bank RD account and start accumulating profit from Canara Bank RD rates: 

• Step 1: Visit the Canara Bank branch where you have a savings account and ask for an RD form. 
• Step 2: Fill out the form with details such as RD amount and tenure. Do not forget to mention the nominee’s name. 
• Step 3: Provide standing instruction if you want automatic deduction of monthly instalments from your savings account. 
• Step 4: Submit essential documents for identity and address proof. 
• Step 5: Deposit the first instalment. You can make the payment with cash, cheque, or online. 
• Step 6: The RD account will be live after verification of all your data. 

How to Calculate RD Interest Rates in Canara Bank?

You can easily calculate the maturity amount with the help of a few information such as Canara Bank RD rates, your monthly instalments, and tenure. There are two ways to calculate this. One is with a formula and the other is using online platforms. Here is a demonstration of the two modes: 

RD Calculation Formula 

A = P x (1 + R/N)^NT

In this formula: 

• A represents the maturity amount
• P represents the principal amount from which compounding will start 
• R represents the annual rate of interest 
• N represents the number of times the interest is going to be compounded in a year 
• T represents tenure 

Let’s say, your (not a senior citizen) monthly instalment (P) is ₹2,000, the interest rate (R) is 6.15%, and the tenure (T) is 3 years. 

Then, A = 2000 x (1 + 0.0615/4)^4×3 = ₹79,216.

With this formula, your maturity amount at the end of the tenure would be ₹79,216. Your total investment for the entire tenure would be a total of ₹72,000 and the interest gain would be of ₹7,216. However, there is a greater chance of error while using this method. This is the reason online RD calculators are safer as they provide accurate results quickly. 

Canara Bank RD Calculator

Here’s how to use an RD calculator and find out your maturity amount: 

• Step 1: Enter the monthly investment value. 
• Step 2: Adjust the interest rate as per Canara bank RD rates. This rate might differ from one tenure to another.
• Step 3: Finally choose the tenure for which you wish to invest.
• Step 4: After this the calculator will automatically show you the results. 

Eligibility Criteria for Canara Bank RD Account

You are eligible to start an RD account at Canara Bank and accumulate wealth as per the applicable Canara Bank RD rates if you are one of the following: 

1. An individual 
2. A joint account holder 
3. A guardian on behalf of a minor 
4. Hindu Undivided Family (HUF)
5. A company 
6. A Proprietorship firm 
7. An association
8. An institution 
9. A trust 

Documents Required for Canara Bank RD Account

Apart from the application form the bank prescribes the documents one has to submit to start an RD account in Canara Bank. They can be divided into two parts: identity proof and address proof. 

Identity Proof 

1. Photograph of depositor/s (2 copies)
2. Copy of PAN card 
3. Voter ID 
4. Aadhaar card 

Address Proof

1. Driving licence 
2. Valid passport 
3. Flat maintenance bill (not older than 2 months) 
4. Bank Statement, Passbook (not older than 3 months) 
5. Electricity/Phone Bill (not older than 2 months)

Types of Canara Bank RD Accounts

Canara Bank offers three types of RD schemes for investors:

1. Regular Recurring Deposit 

If you are someone who wishes to build a habit of saving a certain amount of money every month then Canara Bank regular recurring deposit is a good option for you. It also offers special rates for senior citizens.

• Minimum Deposit: ₹50/month 
• Maximum Deposit: No ceiling 
• Tenure: 6 months to 120 months
• Interest Rate: 6.15% to 7.25% for the general citizens and 6.65% to 7.75% for senior citizens 
• Eligibility: Indian residents 

2. Canara Dhanvarsha 

Apart from the Canara Dhanvarsha’s interest rate, you can benefit from a lot of other attractive features like multiple monthly instalments, flexible instalments, no penalty for premature withdrawal or delayed payments, etc. by investing in this flexi RD scheme.

• Minimum Deposit: ₹500/month 
• Maximum Deposit: ₹1 lakh/month
• Tenure: 1 year to 10 years
• Interest Rate: 6.15% to 7.25% for the general citizens and 6.65% to 7.75% for senior citizens 
• Eligibility: Indian residents 

3. Nitya Nidhi Deposit Scheme 

This scheme is a result of an amalgamation of two schemes: Syndicate Bank’s Pigmy Deposit Scheme and Canara Bank’s New Nitya Nidhi Deposit Scheme. It is based on a daily door collection of small savings of daily savers of small means. 

• Minimum Deposit: ₹50/month
• Maximum Deposit: ₹30,000/month
• Tenure: 63 months
• Interest Rate: 2.00% on maturity (in effect from 01.10.2022) 
• Eligibility: Indian residents 

Canara Bank RD Premature Withdrawal Rules

A 1.00% penalty will be levied if you close your RD account prematurely. It is applicable for all accounts that investors had opened on or after 04.02.2011. According to Canara Bank’s premature withdrawal rules, that account will earn interest at 1.00% below the interest rate that was applicable on the date of deposit. 

Canara Bank RD Penalty

There is a penalty involved for two different types of scenarios. Take a note of the points mentioned below to avoid these: 

• There is a penalty of ₹1.50 and ₹2 for every ₹100 (respectively for tenures less and more than 5 years) for delay of instalment payment. 
• If you delay to remit more than 4 instalments, the RD account will be repaid at Simple Interest. 

How to Close Canara Bank RD Account Offline?

To close your RD account at Canara Bank go through the following steps: 

• Step 1: Visit the bank and fill out an RD account closure form. Note that if this was a joint account both the parties need to be present and provide a signature. 
• Step 2: Attach the KYC documents and submit the form to the officer-in-charge or the branch manager. 
• Step 3: Submit the RD certificate or RD receipt. 
• Step 4: After verification, you will be able to withdraw the maturity amount. You can also opt for a transfer of the money to another account. 

TDS on Canara Bank RD

As per the individual’s income tax slab, the earning that comes through the Canara Bank RD rates is taxable. The bank deducts a 10% TDS at the source if your earnings from the interest exceeds ₹40,000 per annum. For senior citizens, it is ₹50,000 per annum. 

The bank will deduct a 20% TDS if you do not submit your PAN details. 

Loan Against Canara Bank Recurring Deposit

Canara Bank allows loans against its RDs. 90% of the deposit amount is the maximum loan that is available. Here are some things to consider before taking a loan against your RD: 

1. This is a secured loan.
2. If you have to get the loan, your recurring deposit will be collateral for the loan.
3. If you default on any loan repayment the bank will adjust it with the amount available in the RD account. 
4. You have to pay a lower interest if you opt for this facility in comparison to a personal loan. 

Conclusion

Now you have a comprehensive idea about Canara Bank RD rates for 2023. With this information, you can decide the amount of monthly instalments, and tenure necessary to meet your financial goals. It is recommended to go through all scheme-related documents before investing your hard-earned money with any investment instrument. 

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Disclaimer

This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.