Understanding the 6.7% Quarterly Compounded Rate of India Post’s RD Scheme

The Post Office RD applies a quarterly compounding mechanism to its 6.7% nominal rate, which means interest is added to the balance every three months. This method accelerates growth compared with simple‑interest products. Depositors start the first instalment at the time of account opening; subsequent payments are due by the 15th of each month for accounts opened early in the month. After completing one year, the holder may also apply for a loan worth up to 50% of the eligible balance, with flexible repayment options either as a lump sum or in instalments.