Kotak Mahindra Bank has increased the Recurring Deposit (RD Account) interest rates. The new interest rates on RD account have come into effect from today i.e. December 28, 2022.
This is the second time that the private sector bank has increased the interest rate of RD account this month. The last time the bank increased the RD interest rate on December 9, 2022. After the change, the private sector bank is offering an interest rate of 7 per cent per annum on RD tenure between 15 months to 21 months.
How much has been increased
The interest rate on RD account has been increased by 75 basis points (100 basis points/bps = 1%) for certain tenures. The bank has increased the interest rate on RDs for 6 months, 12 months, 15 months, 18 months and 21 months. The interest rate offered on RD account opened by senior citizens has also been increased. The revision in RD account interest rate is only for fixed tenure and up to 50 bps. RD account interest rate has been increased for 6 months, 12 months, 15 months, 18 months and 21 months.
General Recurring Deposit Interest Rate
| tenure | Interest rate applicable from December 9 (in percent) | Interest rate applicable from December 28 (in percent) |
| 6 months | 5 | 5.75 |
| 12 months | 6.25 | 6.75 |
| 15 months | 6.50 | 7 |
| 18 months | 6.50 | 7 |
| 21 months | 6.50 | 7 |
Senior citizens get more interest
Senior citizens planning to open a Recurring Deposit account will be eligible for higher interest rates in Kotak Mahindra Bank. The highest interest rate offered on Senior Citizens RD accounts is 7.50 per cent per annum for a tenure between 15 months to 21 months. Kotak Mahindra Bank is offering an RD tenure of minimum 6 months and maximum 10 years.
Senior Citizen Recurring Deposit Interest Rate
| tenure | Interest rate applicable from December 9 (in percent) | Interest rate applicable from December 28 (in percent) |
| 6 months | 6 | 6.25 |
| 12 months | 6.75 | 7.25 |
| 15 months | 7 | 7.50 |
| 18 months | 7 | 7.50 |
| 21 months | 7 | 7.50 |
Penalty on RD account
If there is a delay in the scheduled RD installment payment or premature closure of the RD account, then a fine is imposed on the RD account holder. As per the website of Kotak Mahindra Bank, late payment of RD installment will attract a fine. The applicable interest rate on Fine RD account will be 2% per annum. The penalty for premature withdrawal of RD depends on when it is withdrawn. If the RD account is closed prematurely within one month of deposit, no interest will be charged.
