Are you looking for a safe and disciplined way to grow your savings with guaranteed returns? The PNB RD Scheme (Recurring Deposit Scheme by Punjab National Bank) allows you to start investing with as little as ₹100 per month and offers attractive interest rates, making it a smart option for both beginners and seasoned savers.
Whether you’re a student saving pocket money, a salaried professional, or a retired individual looking for stable growth, this scheme is tailored for anyone who values security, consistency, and good returns.
PNB RD Scheme
| Feature | Details |
|---|---|
| Minimum Investment | ₹100 per month |
| Tenure | 6 months to 10 years |
| Interest Rates | 6.35% to 7.25% (General), 7.00% to 7.75% (Senior Citizens) |
| Loan Facility | Up to 80-90% of deposit value |
| Premature Withdrawal | Allowed with nominal penalty (1%) |
The PNB RD Scheme is an excellent choice for those who want to build wealth gradually while enjoying the safety and trust of a nationalised bank. With low entry requirements, flexible tenures, and competitive interest rates, it’s a practical tool for meeting short-term or long-term financial goals.
Whether you’re saving for a big purchase, a child’s future, or just aiming to develop a disciplined financial habit, this scheme makes it simple and rewarding.
What is the PNB RD Scheme?
The PNB Recurring Deposit Scheme is a monthly investment plan where you can deposit a fixed amount every month for a pre-decided tenure. In return, you earn compound interest on your deposits, which helps you build a substantial corpus over time. It’s perfect for people who can’t invest a large sum in one go but can save small amounts consistently.
Think of it as planting a seed every month and watching a tree grow steadily. At the end of the chosen period, you receive the maturity amount, which includes both your monthly deposits and the interest earned.
see also: Want to take a personal loan?
Interest Rates for 2025
As of March 2025, Punjab National Bank offers the following interest rates on RD accounts:
For General Public:
- 6.35% to 7.25% per annum, depending on tenure
For Senior Citizens:
- 7.00% to 7.75% per annum (0.50% extra on applicable rate)
These rates are compounded quarterly, which means your interest earns more interest every three months—a powerful benefit for long-term savers.
How Does PNB RD Work?
Let’s break it down with an example:
Example:
- Monthly Deposit: ₹1,000
- Tenure: 5 years (60 months)
- Interest Rate: 6.75% (as applicable)
Using the standard RD maturity formula, your maturity amount will be approximately ₹70,000, with interest earnings around ₹10,000. You can use the PNB RD calculator to estimate your returns based on your budget and tenure.
Who Should Invest in PNB RD?
This scheme is perfect for:
- Young earners or students looking to build a saving habit.
- Salaried professionals aiming to plan for short-term goals (like a holiday or gadget purchase).
- Retirees or homemakers wanting safe and stable income.
- Parents saving monthly for children’s education or marriage.
The low entry point (just ₹100/month) makes it inclusive and accessible to all income groups.
Benefits of PNB RD Scheme
Guaranteed Returns
You earn fixed interest throughout the tenure, unaffected by market volatility.
Loan Facility
Need urgent funds? Get a loan or overdraft up to 90% of your RD balance without breaking the deposit.
Flexible Tenure
Choose a period that suits your goal: from 6 months to 10 years.
Easy Online Management
Existing PNB account holders can open and manage their RD online through PNB Net Banking.
Senior Citizen Advantage
An extra 0.50% interest ensures better returns for those aged 60 and above.
How to Open a PNB RD Account
Step-by-Step Guide:
Option 1: Online
- Log in to PNB Internet Banking
- Go to “Deposit Services”
- Select “Open RD Account”
- Choose amount, tenure, and nominee
- Confirm and submit
Option 2: Offline at Branch
- Visit your nearest PNB branch
- Fill up the RD Account Opening Form
- Submit KYC documents (Aadhaar, PAN, etc.)
- Deposit your first installment
Taxation on RD Interest
The interest earned on RD is taxable under ‘Income from Other Sources’. If the total interest across all bank FDs and RDs exceeds ₹50,000 in a financial year (₹75,000 for senior citizens), TDS (Tax Deducted at Source) of 10% will be applied.
To avoid excess deduction:
- Submit Form 15G/15H (if eligible)
- Track your annual interest earnings
see also: SBI’s Highest Interest Paying FD Scheme 2025
PNB RD Scheme FAQs
Q1. Can I invest more than ₹100 in PNB RD?
Yes, you can invest any amount in multiples of ₹10, starting from a minimum of ₹100/month.
Q2. What happens if I miss a monthly RD installment?
A small penalty may be charged for missed payments, and it might affect your interest slightly.
Q3. Can I close my PNB RD account early?
Yes, but you may lose part of your interest earnings due to a 1% penalty on the applicable rate.
Q4. Is the PNB RD Scheme safe?
Absolutely. PNB is a government-owned bank, and your deposits are insured up to ₹5 lakh under the DICGC scheme.
Q5. Can NRIs open an RD account in PNB?
Yes, NRIs can open NRE/NRO RD accounts. However, interest rates and rules may vary.
