About this calculator
A fixed deposit pays a set rate for a set time. Most Indian banks add interest every quarter, so the yearly yield is a little higher than the quoted rate.
How it is calculated
- Maturity = P × (1 + r ÷ n)^(n × t), where n is how many times a year interest is added.
- Effective yield = (1 + r ÷ n)^n − 1.
Assumptions. The rate is fixed for the whole tenure, interest is reinvested (cumulative FD), and nothing is withdrawn early. Tax is not included.
Questions
Why is the effective yield higher than the rate?
Because interest is added several times a year and then earns interest itself.
Does premature withdrawal change this?
Yes. Banks usually cut the rate and may charge a penalty. Ask your bank.
Is this exact?
It is a standard formula using the numbers you enter. Your bank, fund or lender may round differently or use different dates, so treat it as a close estimate and check the final figure with them.