Important features of bank deposit account are as noted below :
(1) Any individual (of major age) can open a bank account by following simple
procedure. An account holder is treated as bank customer and all normal banking
facilities and services are offered to him. A bank account may be single or joint.
Nomination facility is also given to account holders.
(2) Deposits in the banks are safe and secured. They can be withdrawn as per the terms
and conditions of the bank account. The benefit of deposit insurance scheme is also
available to bank depositors.
(3) Money can be deposited at any time in the case of current and savings bank
accounts. In the case of fixed deposit account, it is deposited only once and money is
deposited every month in the case of recurring deposit account.
(4) Interest is paid on bank deposits (except current deposits) The interest rate is
decided by the RBI from time to time as per the money market situation. The cooperative
banks offer nearly one per cent higher interest rate as compared to
commercial banks. Even senior citizens are offered a little higher interest rate
(normally one per cent).
(5) Interest is paid on quarterly or six monthly basis. However, if the deposit period is
less than 90 days, the interest is paid on maturity.
(6) Bank deposits have high liquidity. Banks even give loan on the security of fixed
deposit receipts.
6 Comments