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Types of Deposit Accounts

class 9 banking unit-2

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Saanvi Devarasetty
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8 views14 pages

Types of Deposit Accounts

class 9 banking unit-2

Uploaded by

Saanvi Devarasetty
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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TYPES OF DEPOSIT Saanvi Devarasetty

ACCOUNTS
DEPOSIT ACCOUNTS

Deposit accounts is broadly classified


into two types:-

Demand deposit

Time deposits
DEMAND DEPOSITS
Demand deposits are those which
are repayable by the banks ‘on
demand’ by the depositor.

These deposits have no time


restrictions by the banks – no
minimum maximum periods are
stipulated.

Savings bank and current accounts


fall in this category.
SAVINGS ACCOUNT
Savings deposits, which are also demand
deposits, are subject to restrictions on the
number of withdrawals as well as on the
amounts of withdrawals during any specified
period.

Its interest is paid at a fixed rate of 4-7% p.a

Minimum balances are maintained


FEATURES OF SAVINGS
ACCOUNT
The main objective of savings account is to promote savings.

There is no restriction on the number and amount of deposits.

Withdrawals are allowed subject to certain restrictions.

Money can be withdrawn either by cheque or withdrawal slip.

No loan facility is provided against saving account.

Internet banking for accessing accounts through online is also available.

Nomination facility is available is case of savings accounts.

Standing Instructions can be given to the bank to carry out instructions.


CURRENTS ACCOUNTS

The current accounts bear no interest and they account for the
smallest fraction among the current saving and term deposits.

The people who use current accounts are: Businessman, firms,


companies, and public enterprises etc.
Current account can be opened by an individual who has attained
majority, two or more individuals in their joint names, sole
proprietorship concerns, partnership concerns, HUF, Limited
Companies, clubs, societies, Trusts, executors and administrators,
others.
FEATURES OF CURRENT
ACCOUNTS

Penalty is
charged if It charges No
It needs a
It is a non- minimum interest on restriction No
higher Does not
interest balance is the short It is of a on the restriction
minimum promote
bearing not term funds continuing number on the
balance to saving
bank maintained borrowed nature and withdrawal
be habits
accounts in the from the amount of s made.
maintained
current bank deposits
account
TERM DEPOSITS
The accounts which is opened for a particular fixed period (time) by
depositing particular amount(money) is known as Fixed(Term) Deposit
Account

There are three types of Term deposits available:

Fixed deposit

Re-investment deposits

Recurring deposit
FIXED DEPOSITS
Fixed rate of interest is paid at fixed,
regular intervals and the principal
amount is returned at the end of the
maturity period.
This interest may be paid in cash to
the depositor or may be credited to
his savings account, as instructed by
him.
FEATURES OF FIXED
DEPOSIT
The main purpose of fixed deposit account is to enable the individuals to earn a higher rate
of interest on their surplus funds

The amount can be deposited only once.

The period of fixed deposits range between 15 days to 10 years.

A high interest rate is paid on fixed deposits

Withdrawals before maturity are not allowed. In case of emergencies the bank charges a 1%
(deduction may vary) from the interest payable as so on that date on the basis of the period
for which the deposit was actually transferred.

The depositor is given a fixed deposit receipt at the time the deposit was made.
RE-INVESTMENT DEPOSITS

Interest is
compounded quarterly
and paid on maturity,
along with principal
amount of the deposit.
RECURRING DEPOSIT
A recurring deposit is a type of term
deposit in which a specified fixed amount
is deposited at regular intervals for a fixed
term and the repayment of principal and
accumulated interest is made at the end of
the term.
RD is generally opened to finance pre-
planned future purposes like expanses of
daughter wedding, purchase of costly
items like land, luxury car, refrigerator or
air conditioner, etc
FEATURES OF RECURRING
DEPOSIT
•The main objective of recurring deposit is to develop regular
savings habit among the public.
•The minimum amount that can be deposited is Rs.10 at regular
intervals
•The period of deposit is minimum six months and maximum ten
years
•The rate of interest is higher than other accounts
•No withdrawals are allowed
•The bank provides loan facility. The loan can be given up to 75% of
the amount standing to the credit of the account holder.
THANK
YOU

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