How Recurring Deposit Maturity Is Calculated
In an RD you deposit a fixed amount every month, and each installment earns compound interest for the time it stays in the account. Indian banks compound RD interest quarterly, so this calculator converts your annual rate into the equivalent monthly growth rate of quarterly compounding and grows every installment month by month — the same approach banks' own calculators use.
Example: ₹5,000 per month at 7% for 5 years → you deposit ₹3,00,000 and receive roughly ₹3.6 lakh at maturity — about ₹60,000 of it pure interest. Later installments earn less than earlier ones because they compound for fewer months.
RD vs FD: the same total money in an FD earns a little more (all of it compounds from day one), but an RD matches how salaried people actually save. RD vs SIP: an RD's rate is guaranteed; a SIP is market-linked — historically higher over long horizons, but never guaranteed.
Also see the FD Calculator for lump sums and the PPF Calculator for the 15-year tax-free scheme.