Documents Required for RD Account

A Recurring Deposit (RD) scheme is an excellent investment option for senior citizens in India. The scheme offers a regular source of income and helps in building a corpus of funds for the future. An RD account allows people to deposit a fixed amount of money every month for a specified period and earn interest on it.

Documentation is necessary while opening an RD account to ensure the authenticity of the account holder, comply with legal and regulatory requirements and maintain proper records of transactions. It is crucial to submit all the necessary documents to open an RD account and prevent any issues in the future. The government has mandated that banks and financial institutions must follow strict KYC norms while opening any type of account. This is to prevent money laundering, terrorist financing and other illegal activities. Before opening an RD account, there are certain documents that senior citizens need to submit. Detailed below are the list of documents required for opening a Senior Citizens RD in India.

• Application Form: Duly filled and signed application form The application form in the bank's prescribed form for opening Senior Citizens RD.
• Age Proof: Senior citizens need to provide proof of their age to open an RD account. The age proof can be any government-issued document like a passport, voter ID, or Aadhaar card.
• Identity Proof: Senior citizens need to submit proof of their identity, which can be a passport, voter ID, driving license, government ID, senior citizen ID, PAN card, or Aadhaar card.
• Address Proof: Address proof is necessary to open an RD account. Senior citizens can submit documents like a passport, voter ID, telephone bill, electricity bill, bank statement with cheque, or Aadhaar card as address proof.
• Passport-size Photographs: Senior citizens need to submit 2 passport size photographs along with the documents mentioned above.
• PAN Card: A Permanent Account Number (PAN) card is necessary for opening an RD account. It is a unique 10-digit alphanumeric code issued by the Income Tax Department of India.
• Form 60/61: If you do not have a PAN, you will have to submit Form 60. This form is an alternative to PAN and it is mandatory to submit it while carrying out financial transactions. If you have provided an incorrect PAN while carrying out any transaction, you will have to submit Form 61.
• Nomination Form: A nomination form needs to be filled while opening an RD account. The form mentions the name of the nominee who will receive the money in case of the senior citizen's unfortunate demise.
• Form 15H: If the senior citizen's annual income is below the taxable limit, they need to submit Form 15H to the bank. This form declares that the senior citizen's income is below the taxable limit and hence, no tax needs to be deducted from the interest earned on the RD account.
• Introduction by an existing bank customer: An introduction by an existing bank customer can be a powerful tool in attracting new customers. It can help potential customers gain trust in the bank, provide insights into the bank's services and ultimately lead to a positive banking experience. Some of the banks may required you to submit the introduction by an existing bank customer.
• Any other Document: Any other document may be required by the bank based on the applicant's profile.

Reasons to Submit Proper Documentation to Bank for Opening Senior Citizens RD Account

When opening a Recurring Deposit (RD) account, submitting proper documentation is essential. Proper documentation not only helps in establishing the identity of the account holder but also ensures compliance with various regulatory requirements. Banks are required to follow Know Your Customer (KYC) norms set by the Reserve Bank of India (RBI). Proper documentation helps in establishing the identity and address of the account holder, which is a crucial requirement under KYC norms.

Here are some reasons why submitting proper documentation is crucial when opening an RD account:

1. Compliance with KYC norms: Banks are required to follow Know Your Customer (KYC) norms set by the Reserve Bank of India (RBI). Proper documentation helps in establishing the identity and address of the account holder, which is a crucial requirement under KYC norms.
2. Prevents fraud: Submitting proper documentation helps banks in verifying the authenticity of the account holder's identity. It reduces the risk of fraud, which is prevalent in the financial sector.
3. Legal compliance: Proper documentation ensures compliance with various legal requirements. It helps in establishing the source of funds, which is crucial in preventing money laundering and terrorist financing.
4. Tax compliance: Proper documentation helps in complying with tax regulations. Banks require a PAN card or Form 60/61 for opening an RD account. This ensures that the account holder's income is correctly reported to the Income Tax Department.
5. Smooth operation of the account: Submitting proper documentation ensures the smooth operation of the account. It helps in avoiding delays and ensures that the account holder receives regular updates about their RD account.

Proper documentation assures the bank that the account is being opened by a genuine person and helps in preventing fraudulent activities. Banks are required to maintain proper records of all transactions to prevent any discrepancies. This helps in identifying any illegal activity and resolving the issue at the earliest.

Documents Required to Withdraw Money from the RD Account Before Maturity

When you need to withdraw money from a Recurring Deposit account before its maturity, the required documents might differ from bank to bank. There are some common documents which most banks require for processing the premature withdrawal which are as detailed in the following table.