Types of Different Deposit Products & Services; Services to Customers & Investors
Different types of Deposit Products
Savings Bank Account
- As the name suggests this type of account is suitable for people who have a definite income and are looking to save money. For example, the people who get salaries or the people who work as laborers. This type of account can be opened with a minimum initial deposit that varies from bank to bank. Money can be deposited at any time in this account.
- Withdrawals can be made either by signing a withdrawal form or by issuing a cheque or by using an ATM card. Normally banks put some restriction on the number of withdrawal from this account. Interest is allowed on the balance of deposit in the account. The rate of interest on savings bank account varies from bank to bank and also changes from time to time. A minimum balance has to be maintained in the account as prescribed by the bank.
Current Deposit Account
- Big businessmen, companies, and institutions such as schools, colleges, and hospitals have to make payment through their bank accounts. Since there are restrictions on the number of withdrawals from a savings bank account, that type of account is not suitable for them. They need to have an account from which withdrawal can be made any number of times.
- Banks open a current account for them. Like a savings bank account, this account also requires a certain minimum amount of deposit while opening the account. On this deposit, the bank does not pay any interest on the balances. Rather the account holder pays a certain amount each year as an operational charge.
Fixed Deposit Account
- Some bank customers may like to put away money for a longer time. Such deposits offer a higher interest rate. If money is deposited in a savings bank account, banks allow a lower rate of interest. Therefore, money is deposited in a fixed deposit account to earn interest at a higher rate.
- Note: This period of deposit may range from 15 days to three years or more during which no withdrawal is allowed.
Recurring Deposit Account
- While opening the account a person has to agree to deposit a fixed amount once in a month for a certain period. The total deposit along with the interest therein is payable on maturity. However, the depositor can also be allowed to close the account before its maturity and get back the money along with the interest till that period.
- The account can be opened by a person individually, or jointly with another, or by the guardian in the name of a minor. The rate of interest allowed on the deposits is higher than that on a savings bank deposit but lower than the rate allowed on a fixed deposit for the same period.
The Recurring Deposit Accounts may be of the following types:
- Home Safe Account or Money Box Scheme
- Cumulative-cum-Sickness deposit Account
- Home Construction deposit Scheme/Saving Account
CASA Deposit Account:
- CASA is the acronym for Current and Savings account, which is commonly used in the banking industry across West Asia and South-East Asia. Banks usually receive the majority of their funds from various kinds of deposit schemes like current accounts, Savings Accounts and term deposits.
- CASA deposit is the amount of money that gets deposited in the Current and Savings Accounts of bank customers. The bank pays very low or no interest for deposits in current accounts whereas the deposits in Savings Accounts receives slightly higher interest rates. It is the cheapest and major source of funds for banks. This fund source is in turn used to distribute Home Loans, Personal Loans etc.
Reinvestment Deposit Account:
- This is special term deposits. This plan helps you to earn interest on interest, thus giving you a two-fold income. You deposit your money with us for any period between six months to 10 years, and we pay you interest on your deposited money plus on the interest you earn.
Services to Customers & Investors
Individual Banking—Banks typically offer a variety of services to assist individuals in managing their finances, including:
- Checking accounts
- Savings accounts
- Debit & credit cards
- Wealth management
Business Banking—Most banks offer financial services for business owners who need to differentiate professional and personal finances. Different types of business banking services include:
- Business loans
- Checking accounts
- Savings accounts
- Debit and credit cards
- Merchant services (credit card processing, reconciliation and reporting, check collection)
- Treasury services (payroll services, deposit services, etc.)
Digital Banking—The ability to manage your finances online from your computer, tablet, or smartphone is becoming more and more important to consumers. Banks will typically offer digital banking services that include:
- Online, mobile, and tablet banking
- Mobile check deposit
- Text alerts
- E Statements
- Online bill pay
Loans—Loans are a common banking service offered, and they come in all shapes and sizes. Some common types of loans that banks provide include:
- Personal loans
- Home equity loans
- Home equity lines of credit
- Home loans
- Business loans
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