Question

Write a detailed note on the four types of deposits.

Answer 1

Instructions:
Write about savings deposit, current deposit, fixed deposit, and recurring deposit.

Solution:

• Savings deposit:
  • Allows the public to deposit their savings in the bank and receive an interest amount for the deposited money.
  • Savings deposits feature a limited number of withdrawals.
• Current deposit:
  • Allows people to deposit and withdraw money many times in a day and does not receive any interest for the deposit money.
  • Current deposits are used mainly by traders and industrialists.
• Fixed deposit:
  • Allows people to deposit money for a fixed period of time for which the interest money for that period will be calculated accordingly.
  • The interest rate fixed for that period will be given fully if the money is withdrawn after the specified period.
  • If the customer withdraws the money before the maturity period, then the interest rates will become lower.
• Recurring deposit:
  • Customers receive a specific interest amount every month for a specified period of time.
  • The interest rate of recurring deposits is higher than that of saving deposits but less than that of fixed deposits.
  • Similar to fixed deposits, the interest rate will be less if the deposits are withdrawn before the maturity date.