0
A Fixed Deposit involves locking a particular amount of money for a certain time period, say Rs 20000 for 1 year, at a much higher rate of interest than being given on amount in a savings account. The interest on Fixed Deposit varies with the state of economy, being much higher when inflation is high (so that people save more and spend less), sometimes being as high as 10% per annum , to as low as 6% per annum, when economy is going good and inflation is low.
To create a FD, you normally need to have a savings account with that bank. Since interest accrued on a FD is much much higher than that on a savings account, its wise to keep money parked in these instruments.
However one must be sure to balance their needs well so that they do not have to break an FD before maturity to meet their daily requirements. It means that if a FD is broken before its maturity, a penalty is applied, and hence the returns come out to be much lower comparatively. So make sure your needs are well taken care of, before you park the money in fixed deposits.
There are so many popular Banks like HDFC, Axis, ICICI and NBFCs like Bajaj Finserv which offers high interest rate on Fixed Deposit.
Dorothy Deckow
Wiki User
∙ 12y agoA Fixed Deposit is a special type of deposit account that can be opened by any customer. The customer will deposit a large sum of money with the bank for a predetermined period of time (Usually in months or years). The bank will offer a good interest rate to the customer for parking his/her money long-term with them. The customer wouldn't break his deposit mid term and keep it until maturity because if he does so, he will be charged a penalty for doing so.
Add your answer:
Earn +20 pts
How is a certificate of deposite different from a regular savings account?
Savings Account: A savings account is one in which customers save their monthly savings and they are not like the current account. Though the money is available at any time for the customer to withdraw, money is not as frequently deposited/withdrawn from it like the current account. Hence banks offer a meager interest rate for the money held in this account. Certificate of Deposit: A CD Account is one in which the customer deposits a big sum of money (Usually a few thousands and upwards. There is actually no limit to the amount of money you can deposit in a CD) for a fixed duration of time (Atleast 3 months or higher). Since you agree to keep the money deposited with the bank for a fixed/agreed upon duration, the bank gives you a very good interest as payment for keeping the deposit
How do you withdraw from a fixed deposit account?
You cannot withdraw from a fixed deposit account without cancelling the note, which will likely incur a cancellation fee...
How do you write a letter to bank manager for closing fixed deposit?
To Manager Subject: Closing Fixed deposit account. This is to inform you that, My Fixed deposit will mature on 01/12/2012, Kindly request you to transfer the fixed deposit to my Saving account, details are mention below. Name: Saving bank account: your faithfully *****
Can you deposite a payday loan into someone elses account?
Banks will allow deposits into members' accounts. Get your loan then carry the money to their bank if the payday loan people won't do a direct deposit.
Are Fixed Deposits Bought?
No FD's are not bought. They are types of deposit account which are opened in banks for a fixed period....
Fixed deposit is current asset or fixed asset?
Fixed deposit is under fixed assets. Under fixed assets, there are 3 category that is tangible fixed assets (land, machinery, dll), intagible fixed assets (pattern, franchise, dll) and investment (fixed deposite,dll).
Does the lien holder have the title of your car?
where payment cannot made directly to the supplier cheque are deposite in special bank account known as no line account
Theo had a balance of - 4 in his savings account After making a deposite he has 25 in his account What is the overall change to his account?
The overall change to his account was making a deposit of 29. The math would be -4 + 29 = 25 for his current balance.
What do you think the word deposite means?
What do you think the word deposite means
Can you deposite your sisters check?
Be honest and give your sister her check back. ;). She would have to write "pay to the order of (name of account holder)" along with her endorsement.
Can a Canadian citizen apply for a US credit card?
yes. like having a CIBC account in Canada can help you to get a credit card from Bank of America, what you have to do is to open an account in Bank of America and transfer your paychecks for deposite directly into your bank account.
The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed?
Net Fixed Assets is the term used for the difference between the balance of a fixed asset account and the related accumulated depreciation.
What are the functions of Habib Bank Ltd?
saving account fixed account current account
What is the journal entry for lost of fixed assets?
debit loss of assetcredit fixed asset account
How do you withdraw from a fixed deposit account?
You cannot withdraw from a fixed deposit account without cancelling the note, which will likely incur a cancellation fee...
How is a certificate of deposite different from a regular savings account?
Savings Account: A savings account is one in which customers save their monthly savings and they are not like the current account. Though the money is available at any time for the customer to withdraw, money is not as frequently deposited/withdrawn from it like the current account. Hence banks offer a meager interest rate for the money held in this account. Certificate of Deposit: A CD Account is one in which the customer deposits a big sum of money (Usually a few thousands and upwards. There is actually no limit to the amount of money you can deposit in a CD) for a fixed duration of time (Atleast 3 months or higher). Since you agree to keep the money deposited with the bank for a fixed/agreed upon duration, the bank gives you a very good interest as payment for keeping the deposit
What are the types of deposits in SBI bank?
State Bank of India offers different types of accounts. They are: a. Savings Account b. Current Account c. Fixed Deposit Account d. Recurring Deposit Account e. Senior Citizen Deposit Account f. Senior Citizen Pension Account g. Etc.
