Scribd Logo
Upload

Welcome to Scribd!

  • What Is Fixed Deposit

    Uploaded by

    Rohit Dhuri
    16 views2 pages
    Fixed deposits, also known as term deposits, allow depositors to earn interest by depositing money for a fixed period of time. The Reserve Bank of India sets time limits for fixed deposits, which can range from 12 months to 60 months depending on the type of account. Banks do not typically pay interest if a fixed deposit is closed before completing the 12-month period. Fixed deposits have higher interest rates than savings accounts and offer depositors a way to generate returns on their investment. The longer the deposit period, the higher the interest rate typically is.

    Original Description:

    Original Title

    What is Fixed Deposit

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    DOCX, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    Fixed deposits, also known as term deposits, allow depositors to earn interest by depositing money for a fixed period of time. The Reserve Bank of India sets time limits for fixed deposits, which can range from 12 months to 60 months depending on the type of account. Banks do not typically pay interest if a fixed deposit is closed before completing the 12-month period. Fixed deposits have higher interest rates than savings accounts and offer depositors a way to generate returns on their investment. The longer the deposit period, the higher the interest rate typically is.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    16 views2 pages

    What Is Fixed Deposit

    Uploaded by

    Rohit Dhuri
    Fixed deposits, also known as term deposits, allow depositors to earn interest by depositing money for a fixed period of time. The Reserve Bank of India sets time limits for fixed deposits, which can range from 12 months to 60 months depending on the type of account. Banks do not typically pay interest if a fixed deposit is closed before completing the 12-month period. Fixed deposits have higher interest rates than savings accounts and offer depositors a way to generate returns on their investment. The longer the deposit period, the higher the interest rate typically is.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 2

    What is Fixed deposit?

    A Fixed Deposit also known as a Term Depositis an account which allows us to depositmoney for a fixed time period. When the deposit period elapses, thedepositors get interest on the amountdeposited. way to make areturn on investmentthat issomewhat higher than a standardsavingsaccount. RBI Directives Time limits for which FDs / term deposits can bemade. Foreign Currency (Non-Resident) Account (Banks)Scheme (FCNR (B) Account) 12 months to 60months. Non-Resident (External) Rupee Account Scheme (NREAccount) and Non-Resident Ordinary Rupee AccountScheme (NRO Account) Duration is at the solediscretion of the bank offering the deposit scheme. Banks generally do not pay any interest if thesefixed deposit accounts are closed before the 12-month period.

    Types of FDs SPECIAL TERM DEPOSITS: The earned interest is addedto the principal and compounded quarterly. Thisamount is accrued and repaid along with the principalamount on maturity of the deposit. ORDINARY TERM DEPOSITS: The earned interest iscredited to the investor s account, held with the bankor in a bank account of his choice, once a quarter. Inspecific cases, interest may be credited on a monthlybasis. However, this is at the sole discretion of the bankin which the deposit is made

    Special FDs If you hold a Non Resident (Special) Rupee (NRSR)account, you can make an FD for any periodranging from 15 days to 10 years. However, theinterest ratesapplicable to the deposits will bethe same as those offered to resident investors.Further, the principal amount and the interestearned on the deposit will be non-repatriable andthe interest earned will be subject to taxdeducted at source by the banks

    Features FDs are repayable after the expiry of thespecified term varying form 7 days to 120months. They are not as liquid as savings deposits. The rate of interest paid on FDs is higher thanthat of savings deposits. Normally, the longer the term of the deposit,higher is the rate of interest but a bank mayoffer lower rate of interest for a longer period if it expects the rate to dip in future. How to choose FD

    Step 1 : Compare Fixed Deposit Interest Rate Step 2 : Apply for the best option and get aconfirmation call Step 3 : Your Fixed Deposit Account will beopened quickly

    You might also like