03 Aug, 2023

Comparison: Recurring Deposits vs. Fixed Deposits in Nepal

Recurring Deposit (RD) and Fixed Deposit (FD)  introduced by banks are the most popular investment options in Nepal. The main advantage of investing in FD and RDs is to earn fixed returns over a fixed period of time without taking any risk. Both FD and RDs can be opened in Nepal by visiting the bank branch. It can also be opened through mobile banking apps or using internet banking if you have a savings account maintained at the bank you want to apply for RD/FD. 

With many similar features and benefits of these accounts like stable returns, capital protection people get confused which saving option they should go with. So let’s understand its with this blog.

List of some important differences between these accounts are:

Factors                                        Fixed Deposit                                                                                                                            Recurring Deposit 
Frequency of deposit       For a fixed deposit, you have to deposit the amount in one lump sum.For Recurring Deposits you can deposit funds at regular intervals. 
Deposit period                              Three months to ten years Three months, six months to ten years 
Who can open                              Any person having an account in a bankPeople who have a regular source of income
Amount to be deposited                                                  Minimum of Rs.10,000 (It varies from bank to bank)Minimum Rs.500 (It varies from bank to bank)
Interest payments                  Interest payments are available monthly or quarterly.                  Interest payments on RD are made at the time of maturity. 
Withdrawal Withdrawal can be done after the tenure expires. Premature withdrawal can attract penal charges.                                                          Withdrawal can be done after the tenure expires. But some banks allow premature withdrawal in Nepal while some can attract penal charges on premature withdrawal. 
Auto-renewalFDs have an auto renewal option. It is automatically renewed on maturity of the deposit.Auto renewal option is not available in RDs.
Ideally Suited For                   Who doesn't wants to take a risk and want to invest a lump sum amount.Who doesn't wants to take a risk and want to invest small amounts periodically.

Common Features of FD and RD   

RDs and FDs are popular among people due to some common features. Here is a brief about them.

  • Both FD and RD accounts provide fixed income. These accounts are based on a fixed interest rate.
  • As the interest rate is fixed, the return on FD and RD is guaranteed.
  • You can usually avail loan facilities based on your FD and RD.
  • FD and RD both allow for premature withdrawal but some banks don't impose any charges while some impose charges on premature withdrawal.

Also read - Understanding the basics of Recurring Deposit (RD) account in Nepal

So now after knowing all the key differences between RD and FD you can easily choose the best suited option for you. 

How will Saral Banking Sewa help you ?

Saral Banking Sewa is one of the leading bank comparison sites in Nepal. You will be able to understand, compare or get more information about loan products, deposit accounts, fixed deposits and recurring deposits and credit card of all the commercial and development banks of Nepal by logging into the Saral Banking Sewa. Also, you can contact us via phone call, messenger, and WhatsApp for any further queries. 

Contact us:

WhatsApp/Viber: 9851361107

Telephone No.: 01-5269107 

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