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Fixed Deposit Saving Deposit Recurring Deposit Current Account Deposit

This document discusses the different types of deposit accounts offered by banks in India. It describes fixed deposits, which have a fixed term and offer higher interest rates. Savings deposits have lower interest rates but allow limited withdrawals. Recurring deposits require monthly installments over 6-120 months. Current accounts are for business use and offer no interest but allow unlimited transactions. The document also outlines know your customer (KYC) guidelines for banks to prevent money laundering and better understand customers through identity verification and transaction monitoring.

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chakravarti singh
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121 views27 pages

Fixed Deposit Saving Deposit Recurring Deposit Current Account Deposit

This document discusses the different types of deposit accounts offered by banks in India. It describes fixed deposits, which have a fixed term and offer higher interest rates. Savings deposits have lower interest rates but allow limited withdrawals. Recurring deposits require monthly installments over 6-120 months. Current accounts are for business use and offer no interest but allow unlimited transactions. The document also outlines know your customer (KYC) guidelines for banks to prevent money laundering and better understand customers through identity verification and transaction monitoring.

Uploaded by

chakravarti singh
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
ACCOUNTS
1)
2)
3)
4)

Fixed Deposit
Saving Deposit
Recurring Deposit
Current Account Deposit

1.FIXED DEPOSIT

Deposits with the bank is for fixed period of time


Principal is repayable on expiry of the term
Also known as term deposit
Deposit period=3-6 years
No cash reserves to be maintained
High rate of interest

Rate of interest:

After october 1997,banks were permitted to charge their

own interest rates


Interest to be paid according to the schedules in the act
Interest rate varies from bank to bank
Depends upon the amount and period of deposit

Period of deposit:

Minimum period of deposit was reduced to 7days from April


1997
Maximum period=5-10 years

Payment of interest:
Interest may be paid quarterly or half-yearly or on the
request of the depositor
It is based on half-yearly rests or quarterly rests
Amount is credited to the depositors saving or principal
a/c
Withdrawal is not permitted through cheques

FIXED DEPOSIT RECEIPT:


It is a document of title

Features:

Not a negotiable instrument


Cannot be transferred by mere endorsement
Duly assigned and given to the bank
No cheques can be drawn
FDR signed by the depositor and presented by 3 rd
party,banker to get Letter Of Authority

Amount can be claimed by courts order if FDR is lost


Amount due can be attached by court
No stamp to be fixed if the depositor is the prospective
claimant
FDR is concerned with Donotio Mortis causa
Joint FD repayable to all or to one person
Limitation period=according to conditions printed on back
of the receipt
If FDR is lost/destroyed-duplicate receipt
-Indemnity Bond

FDR

2.SAVINGS DEPOSIT

Meant for personal savings


Interest rate is less than that of FD
Until 24.10.2011, interest rate=4%

Restriction on withdrawal:

Number of withdrawal is 50 for 6 months


Minimum withdrawal amount through,
(i)cheque =Rs.5
(ii)Form =Rs.1

Restriction on deposit:

Cheques and other instruments payable to 3rd parties


cannot be used

Minimum balance:

banks prescribe their limit


Usually,Rs.500-Rs.1000

Payment of interest:

Calculated quarterly or longer rest on the minimum balance


Calculated between 10th and 30th/31st of every month
Interest is credited twice in a year

NO FRILLS BANK ACCOUNT:


o
o
o

Recently introduced
Accounts are opened with nil balance
Provide banking facility to all sections of society

AADHAR ENABLED BANK


ACCOUNTS:
o

Accounts opened under Mahatma Gandhi National Rural


Employment Guarantee Act

3.RECURRING DEPOSIT

Also known as cumulative deposit


Fixed amount of money is deposited every month(in
multiples of Rs.100)
Rate of interest is similar to FD
Monthly instalments to be made before the last
working day of the month
Maturity period of the deposit=6-120months

Default:

If depositor closes a/c before maturity,bank:


pays no interest for deposit less than 3 months
1.5% for 6 months
4% for 12 months
Accumulated amount with interest is paid after a month of
payment of last instalment

4.CURRENT ACCOUNT
DEPOSITS
Introduced for business purpose
No restriction on number/amount of withdrawal
Deposits to be paid on demand(demand liability of the
banker)
No interest is given

Previliges:

3rd party/endorsement cheques can be deposited for


collection
Overdraft facility
Loans and advances are given

Characteristics:

No cash handling by the customer


Bankers collect cheques etc.
Regional Rural Banks(RRB) may pay 0.5% interest below
borrowing rate fixed for RRB
From May 1983,interest is paid at savings a/c rate for
deceased depositor from date of death till payment to
legal hiers

SAVINGS PLUS AUTO SWEEP FACILITY A/C:

Surplus amount in savings a/c is converted to term


deposits
Earns interest at a high rate
Provides liquidity
Minimum balance of savings a/c=Rs.5000
Auto sweep may be weekly or monthly
Reverse sweep facility =withdrawal is made in multiples of
Rs.1000 through cheques,ATMs etc.

PREMIUM SAVINGS ACCOUNT:

Similar to savings a/c


offers additional facilities like SMS alert,RTGS/NEFT free
internet banking
Minimum bal.=Rs.25000

MULTI OPTION DEPOSIT


SCHEME(MODS):

Combination of FD and saving or current a/c


Minimum deposit amount=Rs.10000
Minimum subsequent deposit amount=Rs.5000
Period of deposit=12-60months
Overdraft facility

KNOW YOUR
CUSTOMER(KYC)

KYC

To protect the interest of the customers,RBI


advised banks to exercise diligence in
understanding the customer and nature of his
business.
Guidelines are given by RBI

Objectives:
I.
II.
III.

Preventing money laundering


Improve financial dealings
Manage risks

Key Elements:
1.Customer acceptance policy

No account to be opened in anonymous name


Risks to be clearly defined
Documents to be collected and verifications to be done
Banker cannot close/open an account if they are unable to
apply customer due diligence
Circumstances in which customer can act on behalf of
other person to be specified

2.Customer identification procedure-

Customer verification through documents and photographs


For legal entites,bankers should verify:
Legal status
Any person acting on behalf of legal entity
Understanding control structure & ownership of customer

3.Monitoring transaction-

Special attention given to complex transactions


Intensified monitoring for high risk a/c
Record of all transactions
Illegal transaction to be reported
easy monitoring through customer understanding

4.Risk Management-

Apply various anti-money laundering measures

Other Aspects-

Employee training
Customer education
Credit/debit/smart/gift cards
Existing accounts

Procedure in compliance with KYC guidelines

Identification of depositors
Control of financial frauds
Identification of money laundering
Monitoring of large value cash transaction

Unique Customer Identification


Code(UCIC):
Came into existence from June 2012

Benefits:

Identify a customer
Track facilities availed
Monitor financial transaction
Improve risk profiling
Smoothen banking operation
Holistic view of CR profile

THANK YOU!

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