Canara Bank is a leading public sector bank in India that offers its customers the benefit of availing a recurring deposit (RD) account to help them save in a disciplined manner.
The following are the key features of the Canara Bank Recurring Deposit*:
|Canara Bank Recurring Deposit|
|Deposit Amount||Minimum Rs. 50 per month
No Maximum Amount
Equal Amounts deposited every month
|Tenure||Minimum 6 months
Maximum 120 months (10 years)
Tenure Increases in multiples of 3 months
|Interest Rate||Minimum – 6.20% per annum
Maximum – 7.50% per annum
|Interest Rate (Senior Citizen)||0.50% more than general RD interest rate|
|Interest Payout||RD balance compounded quarterly, interest payout occurs at maturity|
*The features of Canara Bank recurring deposit are liable to periodic change.
Canara Bank RD Rates 2019
The following are the Canara Bank RD Rates for 2019 over various time periods*:
|RD Time Period||RD Interest Rate (General Public)||RD Interest Rate (Senior Citizens)|
|6 months to less than 9 months||6.35%||6.80%|
|9 months to less than 12 months||6.40%||6.90%|
|Over 1 year to less than 2 years||7.00%||7.50%|
|2 years to less than 3 years||6.70%||7.20%|
|3 years to less than 5 years||6.20%||6.70%|
|5 years to less than 8 years||6.20%||6.70%|
|8 years to 10 years||6.20%||6.70%|
*Interest Rates updated as of 15/02/19.
Canara Bank Recurring Deposit Eligibility Criteria
The following individuals and organisations/institutions are eligible for opening a recurring deposit account with Canara Bank:
- Individuals (jointly or self)
- Guardian on minor’s behalf
- Hindu Undivided Family (HUF)
- Proprietorship Firm
- Institution etc.
Canara Bank Recurring Deposit Application Form
A recurring deposit application form can be obtained either from a Canara Bank Branch or downloaded from the Canara Bank Official website. After download of the Canara Bank RD application form from official website is completed, it needs to be filled out and submitted with a nearby branch to complete the account opening process.
Documents Required for Opening Canara Banks RD
The following is a list of key documents required for opening a Canara Bank recurring deposit:
- PAN Card Copy / Form 60 / Form 61
- 2 passport photos of primary depositor (s)
- Proof of identity and address (as per applicable KYC requirements)
- Additional documents as per requirements of RD for HUF, company, trust, etc.
Premature withdrawal Penalty for Canara Bank RD
Premature withdrawal is allowed in case of Canara Bank recurring deposit with applicable withdrawal penalties. Under existing rules, Canara Bank RD premature withdrawal penalty is 1% for deposits opened on 04/02/2011 or later. Thus applicable interest rate for prematurely closed recurring deposit is 1% less than the interest rate on booking date as per the original RD tenure.
Canara Bank Loan against Recurring Deposit
Depositors can avail the benefit of obtaining a loan against Canara Bank RD. The amount of loan that can be availed is up to 90% of the recurring deposit balance at the time of availing the loan. The applicable interest rate on Canara Bank Loan against FD scheme varies on a case by case basis depending on the tenure of the loan as well as the applicable RD interest rate.
Taxation of Canara Bank Recurring Deposit
The interest earned from a Canara Bank RD is fully taxable and TDS is deductible at the rate of 10% of interest earned at the time of maturity if total interest exceeds Rs. 10,000 for the financial year. This threshold TDS deduction amount has been increased to Rs. 40,000 per year with effect from AY 2020-21. The income from Canara Bank RD interest also has to be declared by the depositor in his/her IT returns for taxation at the applicable slab rate.