When it comes to investments, Fixed Deposits (FD) and Recurring Deposits (RD) have been popular for decades. This is because the returns from FDs and RDs are considerably higher than what one can receive from savings accounts. Both fixed deposits and recurring deposits enable people to earn a higher interest on their savings. Many people keep only a small amount of money in their savings bank account and invest the rest in term deposit schemes such as an FD and RD.
When it comes to FD vs RD, there are different factors that make them suitable for different people. Despite being term deposit schemes, both fixed deposit and recurring deposit work differently. The working principle of these deposit schemes is simple, most people feel comfortable investing their money as compared to investing in stocks bonds, shares, mutual funds, etc.