The investors who want to start recurring deposits are mostly concerned with sustaining the installments. So to consider this, the bank offers convenience and complete flexibility to the depositor where the amount can be invested in lumpsum, as and when available. Flexi Recurring Deposit (or Flexi RD) provides a facility of depositing as per customer’s convenience.
Flexi RD has two sections one is the core amount, the deposits made by the account holder when the RD is opened, and the other one is the flexible amount, which the depositor deposits every month, according to the funds available in his/her pocket.
Some Notable Points:
- Flexi Recurring Deposit Structure: The account must be opened with the core amount which is 1000 per month minimum for a specific period of time. A flexible deposit is defined in specific multiples of viz. 100 with a ceiling of 10x the core core installment.
- Interest on Flexi RD: On the core amount the interest is charged proportionately at the applicable rate of interest for the period of recurring deposit. On the flexi amount, the interest is charged for the period from the date of deposit at the rate applicable at the time for a similar deposit.
- Due Date & Penalty: The core amount is due on a particular date while the flexible amount can be deposited any time when the funds are available. The penalty is attracted at the time when the depositor fails to deposit the said installment of core amount in a month.
- Some Vital Issues:
- The customer has to pay tax on the interest income accrued, at the time of return filing if applicable. And the bank doesn’t issue a TDS certificate.
- The TDS is deducted by the bank from the amount before paying to the customer at the time of maturity.
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