Fixed & Recurring Deposits

Everyone wants to choose a financial instrument which offers high returns. The most commonly used secure instruments for investment are Fixed Deposit (FD) and Recurring Deposit (RD).
In Fixed Deposit, an amount is deposited for a fixed period of time. A fixed deposit provides interest on the deposited amount.
Whereas, in Recurring Deposits,the customer deposits fixed amounts in small intervals for a long period. The main purpose of a RD is to develop the habit of saving on a regular basis. When the term of RD expires, the whole amount is repaid along with the interest amount. The repeated occurrence of deposits makes it different from FD.


Major Difference between FD and RD

In RD, an investment is made at a fixed period, whereas in FD, the investment is one-time.

RD works well for people who wish to invest minimal amount monthly or at any fixed period.

The investment in FD is a higher lumpsum.