Plenty of institutes offer investment options for one’s financial funds. Out of these options term deposits like he recurring deposit offers a lot of benefits. When investing in this form of term deposit, one can benefit from the following features:

• Plenty of financial institutes offer good returns with the term deposits. However, only a selected few banks provide higher interests for recurring deposit as compared to fixed deposit. This options makes it beneficial for those who wish to invest a small amount of funds on a monthly basis, in order to get good returns at the end of the tenure.

• This term deposit is best for compounding interest. The interest rate is compounded on a quarterly basis for recurring deposit. Therefore, if there is no financial requirement at the end of the tenure, the funds can be reinvested for further financial requirements.

• Senior citizens are provided extra rate of interest, usually 0.5% more for a recurring deposit account other than the normal interest rate.

• The investment amounts that one can invest in this account often differ on one’s requirements. One can opt to invest a small amount such as $100 every month for a minimum deposit. Alternatively, one can invest a higher amount such as $1000 for higher returns at the end of the tenure.

• The monthly instalment amount once fixed cannot be changed until the end of the tenure. The amount cannot be made as in partial instalment nor can one exceed the fixed monthly amount. The account holder will not earn a higher interest rate for any additional amount that is invested. This encourages stringent investment behaviour on a monthly basis until the end of the tenure.

• Monthly payment can either be made through cheque or debited directly from the account held in the financial institute. One may provide standing instruction over the account to fund the fixed amount every month to the recurring deposit.

• Premature withdrawal of the recurring deposit is possible. Although a small penalty will be levied when doing so.

• While a penalty is applied in case one misses a monthly instalment, a grace period of certain fixed days is allowed whereby the applicant can make the payment within the time limit. The normal tenure lasts about one week.

• Nomination facility is available for recurring deposit, where one can nominate a single person to your account

• In addition to these features, one can also take an option to avail loans up to 80% -90% of the deposit value.