When it comes to saving money securely and earning interest, Indian consumers often turn to traditional banking options like Fixed Deposits (FDs) and Recurring Deposits (RDs). Both offer stable returns and low risk—but which one suits your needs best?
In this article, we break down the differences between Fixed Deposit and Recurring Deposit schemes, and help you decide which one is ideal for your financial goals. Whether you’re using Net Banking, Mobile Banking, or popular digital apps like Moneyview, knowing where to park your money wisely is key.
🏦 What is a Fixed Deposit?
A Fixed Deposit is a financial instrument provided by banks and NBFCs where you invest a lump sum amount for a fixed tenure at a pre-decided interest rate. Once you invest, the amount stays locked-in for that duration, and you earn interest periodically or on maturity.
Key Features of Fixed Deposit:
- One-time lump sum deposit.
- Higher interest rates than savings accounts.
- Tenure ranges from 7 days to 10 years.
- Premature withdrawal possible (with penalty).
- Can be opened easily via Online Banking, Net Banking, or apps like Moneyview.
📅 What is a Recurring Deposit?
A Recurring Deposit allows you to deposit a fixed amount every month for a pre-determined tenure. It’s ideal for salaried individuals or those with a steady income who wish to save small amounts regularly.
Key Features of Recurring Deposit:
- Monthly deposits, fixed amount.
- Suitable for long-term disciplined savings.
- Interest is compounded quarterly or monthly.
- Penalty on missing monthly installments.
- Can be opened using Mobile Banking or Net Banking from the comfort of home.
🔍 Fixed Deposit vs Recurring Deposit: A Comparative View
| Feature | Fixed Deposit (FD) | Recurring Deposit (RD) |
| Deposit Type | Lump sum | Monthly installments |
| Interest Rate | Slightly higher | Slightly lower than FD |
| Investment Discipline | One-time | Monthly commitment |
| Returns | Higher for long tenure | Moderate but consistent |
| Flexibility | Lock-in amount | Regular savings |
| Withdrawal | Premature withdrawal possible (penalty) | Premature closure possible |
| Ease of Opening | Available via Online Banking, Moneyview, branch | Available via Mobile Banking, Net Banking, branch |
💰 When Should You Choose a Fixed Deposit?
Choose a Fixed Deposit when:
- You have a lump sum amount to invest.
- You want a safe and stable return on your investment.
- You’re looking to save for short to medium-term goals.
- You don’t need immediate access to the money.
- You prefer not to commit monthly amounts.
With the rise of Online Banking and platforms like Moneyview, opening a Fixed Deposit is easier than ever. You can compare rates, choose your tenure, and even opt for auto-renewals directly through your bank’s Net Banking dashboard.
Example:
Suppose you receive a yearly bonus of ₹1,00,000. Instead of keeping it idle in your savings account, you invest it in a 1-year Fixed Deposit earning 7% interest. You earn ₹7,000 by the end of the year without doing anything further.
💳 When Should You Choose a Recurring Deposit?
Choose a Recurring Deposit when:
- You want to build a savings habit.
- You have monthly income, and want to invest a portion regularly.
- You have future financial goals, like travel, education, or gadget upgrades.
- You want an easy, automated investment tool via Mobile Banking or apps.
Many banking apps and digital finance platforms like Moneyview allow you to set up auto-debit instructions so that your RD amount is deducted every month automatically.
Example:
You decide to deposit ₹5,000 every month into a Recurring Deposit for 2 years at an interest rate of 6.5%. By the end of 2 years, you’ll have saved over ₹1.3 lakh including interest.
📱 How to Open FD or RD Using Online Platforms
Today, most banks offer Fixed Deposit and Recurring Deposit services through:
- Net Banking portals (ICICI, HDFC, SBI, etc.)
- Mobile Banking apps (YONO SBI, HDFC Mobile, Axis Mobile)
- Digital financial apps like Moneyview, where you can track and manage your investments.
Steps to Open FD/RD Online:
- Log in to your Net Banking or Mobile Banking app.
- Go to “Deposits” section.
- Select “Open Fixed Deposit” or “Open Recurring Deposit”.
- Enter amount, tenure, interest payout preferences.
- Confirm and authorize the transaction.
No paperwork. No long queues. Just safe digital banking at your fingertips.
🧠 Pro Tips for Choosing Between FD and RD
- If you’re saving for a specific future goal, like buying a bike or going on a trip, RD can help you stay on track.
- If you have surplus funds from salary hike, gift, or bonus, put it in FD to earn better returns.
- Check for tax implications. Interest earned from both is taxable as per your income slab.
- Senior citizens usually get extra 0.25%-0.50% interest on FDs—make the most of it!
- Always use secure apps like your bank’s Mobile Banking service or trusted finance platforms like Moneyview.
📝 Conclusion: What’s the Final Verdict?
Both Fixed Deposit and Recurring Deposit are great tools for building wealth the safe way. The choice between the two comes down to your financial situation and discipline.
- Go for Fixed Deposit if you have a lump sum amount and prefer one-time investment with better interest.
- Choose Recurring Deposit if you want to save regularly and cultivate financial discipline.
With Online Banking, Net Banking, and Mobile Banking services available 24/7, starting your savings journey is just a few clicks away. Use platforms like Moneyview to monitor your deposits, compare interest rates, and plan your finances smartly.
I am a digital marketing executive as well as content writer in the banking blogs. My goal is to provide simple, interesting and reliable information to readers through my articles so that they always stay updated with the world of banking.
