Question

Write notes on:
Renewal of deposits.

Answer 1

Renewal of deposits is a process whereby the deposit holder continues with the deposit for an additional time period after the completion of the initial time period of investment.
The additional period can be similar or different from the original time period. Instead of withdrawing the deposit amount this is continued.

• Renewal of deposit must need the following procedures to be completed.

1. Board Resolution:- If the company intends to renew deposits instead of refunding them, a resolution in the Board Meeting in this regard is to be passed.

2. Approval from Depositors:- The secretary has to prepare printed application forms for Renewal of Deposits, and these same forms are to be sent to all depositors at least one month before the maturity date.

3. Renewal Receipts:- After receiving the application form for renewal, the secretary has to prepare renewal receipts and is to be sent to the depositors.

4. Entries in register of Depositors:- The secretary has to make the entries of renewal of deposits in the Register of Depositors.