Fixed Deposits:
This type of deposits are made with the bank for a certain period of time.e.g. 1 month,3 month,6 month 9 month 12 month, 5 years etc.
Fixed Deposit ofers higher interest rate because the bank need not to maintain cash reserve for the deposit on the other hand the money can't be withdrawn before the maturity. As the money remains with the bank for a longer time, in addition the bank need not to maintain cash reserve, they provide higher interest rate on such deposits.
***Though the depositer can withdraw his money at any time but in that case the policyholder must give penalty.
Savings Account:
Non trading customers who want to save and have less transactions unlike current accounts.
No comments:
Post a Comment