Deposits & Advances

amdprasad, ssim, hyderabad

Relationship
Deposits Banker is a Debtor & The Depositor is Creditor Advances Banker is the Creditor & The Borrower is the Debtor

Classification of Deposits
Demand / Short Term Deposits Time / Long Term Deposits Savings Account Current Accounts Fixed Deposits Recurring Deposits

Savings Account
It is useful for small money deposits (minimum deposit is fixed ) No fixed term of deposit Day to Day operations Operations permitted through a cheque or withdrawal form Passbook must accompany the withdrawal form ATM / Debit cards are allowed Interest will be paid as fixed by RBI Presently 3.5%pa Interest on the minimum balance between 10th to Last working day of the month

Savings Account
Minimum Balance to be maintained Penalty for not maintaining minimum balance Transactions are restricted to 150 pa (Not practiced) Cheque book charges are applicable Transfer of deposit is possible Joint Deposit is possible Joint with minor not allowed Special minor is permitted no cheque book Nomination is available

Current Account
Useful for Business entities No fixed term of deposit Day to Day operations Operations permitted through cheques only ATM / Debit cards are allowed Minimum Balance to be maintained Penalty for not maintaining minimum balance Unlimited Transactions are allowed Cheque book charges are applicable Transfer of deposit is possible BCTT applicable for Rs. 1.00 lac and above cash transaction Nomination is available

Term Deposits
Fixed Term Fixed amount Interest is fixed as per the term of the deposit No operations Loan facility is available against lien on the deposit Cumulative deposit / interest payment deposits are available Premature cancellation is subject to penalty TDS is applicable Nomination is available Transfer of deposit is possible with in the bank only

Recurring Deposit
Fixed Term Fixed monthly installment amount Interest is fixed as per the term of the deposit Accumulated installments and interest is payable on maturity Deposit Passbook will be issued No operations Premature cancellation is subject to penalty Loan will be available against lien on deposit TDS is applicable Nomination is available Transfer of deposit is possible within the bank only

Types of Customers
Who is a customer? Not defined Sec 131 of NI Act 1881 used a word called Customer Old View By Sir John Paget Duration Theory Great Western Railway vs London & County
Bank

Modern Theory Rejection of Duration theory Ladbrok vs todd,, The Central Bank of India
Ltd vs Gopinathan Nair (Kerala)

Relationship
General Relationship Debtor Creditor Special Features Must Demand Payment Only at the branch where the account is kept Within Banking Hours

Banker is not a Debtor in

Banker as Trustee Safe Custody Banker as Agent Bills / Cheques for collection Jai Sports Ltd vs New Bank of India Ltd (1948) Bankers duty of secrecy
 Where disclosure is under compulsion of law  Where there is a duty to the public to disclose  Where the interest of the bank requires disclosure  Where the disclosure is made at the express or implied consent of the customer

Bankers lien
A lien is a right to retain the goods or securities belonging to the debtor until he discharges a debt due to the retainer thereof Received in Ordinary course of business Set-off Fixed deposit

Accounts of Customers
Preliminary Inquiries- Introduction
                   Indian Bank Vs Catholic Syrian Bank Ltd Liability of the Introducer Who can Introduce KYC Guidelines Forgery Facsimile Principal & Agent Individual Account, Joint Account, Partnership, Companies , Minor Minor as agent Stamping Revocation / Cease / Termination Signature Special / General Donor / Donee Stamping Individual Account, Joint Account, Partnership, Companies, Minor Signature Power of attorney & Mandate Revocation / Cease / Termination

Specimen Signature Mandate

Power of Attorney

Accounts of Customers
Minor Married Women Mentally Challenged Insolvency Joint Account Partnership HUF (Joint Hindu Family) Joint Stock Companies Clubs Associations and Societies Trustees Executors and Administrators Death of the Customer

Know Your Customer (KYC)