SBI Recurring Deposit (RD) scheme is an ideal scheme if you want to grow your savings in a safe and reliable environment with guaranteed returns. It offers the option to invest small amounts at regular intervals and earn attractive interest on them over time. This article deals with how the SBI RD scheme works, with current interest rates (in 2025), and how much you will earn if you invest ₹3,500 monthly for 5 years.
What is the SBI RD Scheme?
SBI RD is a low-risk saving scheme whereby you deposit a fixed amount every month for a specific period (generally, 1-2 or- 5 years). It is for people who want to build wealth safely without any market-related risks. The interest rates get revised every three months, and on maturity, you get back the total value of your deposits and interest earned.
SBI RD Interest Rates (March 2025 Update)
The SBI RD scheme offers competitive interest rates, ensuring steady growth of your savings. Here are the latest rates as of March 2025:
| Investment Period | Interest Rate (General) | Interest Rate (Senior Citizens) |
|---|---|---|
| Less than 1 year | 6.80% p.a. | 7.30% p.a. |
| 1 to 2 years | 7.00% p.a. | 7.50% p.a. |
| 5 years and above | 6.50% p.a. | 7.00% p.a. |
Note: These rates are subject to change every quarter.
How Much Will You Earn by Investing ₹3,500 Monthly for 5 Years?
So, breaking it down: you invest ₹3,500 every month in SBI’s RD scheme for 60 months.
- By the month: ₹3,500
- Yearly: ₹42,000
- Investing over 5 years: ₹2,10,000
Maturity Benefits
- General Investors (6.5% interest): ₹2,48,699.
- Senior Citizens (7% interest): ₹2,52,037.
It thus composes the vast growth of your money: it grows almost exponentially thanks to compounding, under which you earn interest on interest over time.
How Compounding Works In SBI RD?
The following is how it works: SBI RD becomes so powerful because of compounding.
- Monthly deposit amounts earn interest every quarter.
- The interest is added to your principal.
- The following quarter, earn interest on the new total.
- That same thing happens over the year, and your savings will grow exponentially, as always.