Regarding Bank FD interest calculation
This query is : Resolved
14 September 2010
Please guide me for Bank FDR interest calculation. I want to verify the return amount of FD but i am not able to get exact amount which is written on FD Receipt
Principal amount - 1500000
FD Interest rate - 9%
for period - 1 year & 11 months
Maturity amount - 1779100.64
Please guide me formula so i can check for other FDR receipt also.
Principal amount - 1500000
FD Interest rate - 9%
for period - 1 year & 11 months
Maturity amount - 1779100.64
Please guide me formula so i can check for other FDR receipt also.
15 September 2010
Falguni,
Generally Banks calculate interest on FD on a compounding basis. Frequency of compounding is different for different FD products. In your case interest is compounded quarterly. Please see the table below
Period Amount(Begin) Int rate Amount(end)
Qtr 1 1500000 2.25% 1533750
Qtr 2 1533750 2.25% 1568259
Qtr 3 1568259 2.25% 1603545
Qtr 4 1603545 2.25% 1639625
Qtr 5 1639625 2.25% 1676517
Qtr 6 1676517 2.25% 1714238
Qtr 7 1714238 2.25% 1752809
2 mos 1752809 1.50% 1779101
Excuse me for the mis-alligned table.
Interest rate above is for the quarter (i.e 9%/4). Through Simple excel calculation you can reproduce this table. Please get back in case its not clear.
Generally Banks calculate interest on FD on a compounding basis. Frequency of compounding is different for different FD products. In your case interest is compounded quarterly. Please see the table below
Period Amount(Begin) Int rate Amount(end)
Qtr 1 1500000 2.25% 1533750
Qtr 2 1533750 2.25% 1568259
Qtr 3 1568259 2.25% 1603545
Qtr 4 1603545 2.25% 1639625
Qtr 5 1639625 2.25% 1676517
Qtr 6 1676517 2.25% 1714238
Qtr 7 1714238 2.25% 1752809
2 mos 1752809 1.50% 1779101
Excuse me for the mis-alligned table.
Interest rate above is for the quarter (i.e 9%/4). Through Simple excel calculation you can reproduce this table. Please get back in case its not clear.
16 September 2010
Thank you Mr. Bajaj. Thank you for your kind guidance. It will definitely help me for my work.
Falguni
Falguni
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