A recurring deposit calculator is used to find out the maturity amount/ value of a recurring deposit (RD). There is a simple formula which helps in calculation of maturity amount and interest on an RD. There are some things that the customers need to take care of for the calculation of RD amount.
Customers should look each month's installment as a separate deposit. Compounding takes place quarterly, and not monthly. Every monthly deposit earns a different interest and the maturity is the sum total of the maturities (enhanced values) of different months.
Formula used to calculate compound interest on each RD deposit is:
The formula for simple interest is:
As per IBA (Indian Bank Association) the formula used to calculate RD interest is: