Question

What is the difference between fixed deposit and recurring deposit?

Answer 1

Fixed  Deposits:
They are also called as term deposits because the money is deposited with the bank for a fixed period of time. The deposit can be withdrawn after the expiry of maturity period;However , the depositor has an option to borrow against the security of these deposits.These deposits carry more than the saving deposits.The rate of interest varies from 6%per annum to 12% per annum , depending on the period of deposit.
Recurring deposit:
This also called as cumulative deposits. These deposits are very convenient to those who cannot deposit huge amounts at a time .A fixed amount in the multiples of rs.10 may be deposited every month for a period one or more years.These deposits carry a interests more than that savings bank and less than that of term deposit.

Answer 2

Fixed deposit :In a fixed deposit ,the depositor invests a lump sum of amount with the bank for a predominated period. The bank offer a fixed return for the same; typically the rate is higher than what is offered on the savings bank account. However the fixed deposit cannot be easily withdraw and converted into cash.

Recurring deposits : Unlike fixed deposit; investments in recurring deposits are made over a period of time. Hence, investors invest a given sum of money at regular interval of period like every month or every quarter, at the end of the investment period they get predetermined amount.