RECURRING DEPOSIT - DEFAULTED INSTALMENTS
In Recurring Deposit scheme, the depositor has to pay monthly deposit before the last working day of the month in which it is due. If the deposit is not made before the due date, it will be treated as Default.
Where a depositor defaults in payment of any RD monthly instalment, subsequent instalments will be accepted so long as the number of defaults does not exceed four.
Penalty at the prescribed rate will be levied on defaulted RD monthly instalments subsequently deposited during the currency of the account. Revival fee at the rate of one rupee for every hundred rupees of a defaulted instalment for each month of default (proportionate amount for other denominations) shall also be paid along with such deposit in lump-sum. The default fee shall be rounded off as prescribed under this scheme.
The account will be treated as discontinued if there are more than four RD month defaults. Revival of such account will be permitted only within a period of two RD months from the fourth RD month of default after payment of necessary default fee. If the account is not revived within this prescribed period, it will be treated as discontinued and shall not be permitted to be revived after the said period.
In an account which has defaults within the prescribed limits of four RD monthly defaults, the date of maturity will be extended by the number of RD months for which default has occurred. During the extended period, the defaulted instalments can be paid without penalty and the depositor will be entitled for the full maturity value at the end of the extended period.
In the above type of cases, defaulted instalments can also be paid with default fee during the currency period without resorting to extension. Defaulted instalments can also be paid with penalty at the time of maturity of the account and full maturity value with interest will be paid without any extension of the maturity period.
(1). If in any RD account there is monthly default(s) the depositor has to first pay the defaulted monthly deposit with default fee and then he can pay the current month deposit
(2). In RD Journal of branch offices, the penalty will be shown under the relevant column and the RD months to which defaults repaid relate noted in the remarks column.
(3). If there are more than four defaults, the account shall be treated as discontinued and revival of the account shall be permitted only within a period of two months from the month of fourth default. Revival fee at the rate of one rupee for every hundred rupees of a defaulted instalment for each month of default (proportionate amount for other denominations) shall also be paid along with such deposit in lump-sum. The default fee shall be rounded off as prescribed under this scheme.
A depositor whose account has been treated as “Discontinued” will not be eligible for the following benefits:
a Withdrawal
b Rebate on advance deposits
