recurring-deposit

Vocabulary Word

Definition

'Recurring Deposit' (RD) is a kind of savings account where you deposit a fixed amount of money every month to grow your savings. The bank pays you interest on your deposits.

Examples in Different Contexts

A recurring deposit in banking is a type of term deposit that allows individuals to deposit a fixed amount regularly into their account and earn interest. A bank manager might say, 'Recurring deposits are ideal for individuals looking to save regularly with the benefit of earning interest similar to fixed deposits.'

Practice Scenarios

Accounting

Scenario:

Our company needs a safe yet beneficial financial plan. We need to boost our reserves while earning a decent return.

Response:

I believe a recurring deposit could be beneficial. Not only would it build our reserve, but we would also earn interest over time.

Business

Scenario:

We need to plan out our finances for the upcoming project. The funds required are quite huge and we need to have a solid backup funding plan.

Response:

How about starting a recurring deposit with the bank? It can serve as a reliable backup for our future business investments.