Premature withdrawal of Recurring Deposit

If the account holder withdraws the deposited amount before its maturity, the rate of interest that he/she will receive shall be the one applicable to the period for which the deposit has remained with the bank, with a one per cent penalty for premature withdrawal. In RD premature withdrawal is possible however the interest rate offered would be less as compared to the normal base rate which is approximately 8.40% per annum (interest rates vary according to bank stipulations). However some banks would deduct interest rate by 1% to 2% for the period during which the deposit remained in the bank. Usually, the minimum lock-in period for a RD account is 3 months and if a premature withdrawal is made before this period, the account holder would earn zero interest and only the principal amount that was deposited would be refunded to him/her by the bank. In addition to penalty on interest, incentives offered on the RD are also cancelled.

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Franklin India TaxShield

4. ICICI Prudential Long Term Equity Fund

5. IDFC Tax Advantage (ELSS) Fund

6. Birla Sun Life Tax Relief 96

7. DSP BlackRock Tax Saver Fund

8. Reliance Tax Saver (ELSS) Fund

9. Religare Tax Plan