4.Types of Deposit.pptx Demand deposits and Time deposit.

types of Deposit.pptx Demand deposits and Time deposit.

1. Types of Deposit Dr.S.Jayanthi Sobhana Asst.Professor ,Department of commerce PA Sri Ramakrishna College of Arts & Science

2. In banking law, deposits are primarily classified as demand deposits and time deposits. Demand deposits can be withdrawn at any time without notice, such as current and checking accounts.

3. Time deposits are held for a fixed period, with examples including savings, fixed deposits, recurring deposits, and certificates of deposit, and they typically earn higher interest but may incur penalties for early withdrawal.  

4. Demand deposits Definition :  Funds that can be withdrawn by the depositor at any time, without prior notice to the bank.  Characteristics:  Offers high liquidity and is suitable for frequent transactions.  Examples: Current accounts  Checking accounts  Salary accounts (often have demand deposit features) 

5. Time deposits Definition :  Funds that are deposited for a specified, fixed period and cannot be withdrawn without penalty before the maturity date.  Characteristics :  Usually offer higher interest rates than demand deposits.  Examples: Fixed deposits (FDs)   Recurring deposits (RDs)  Savings accounts (while some are demand, many time deposit savings accounts have restrictions)  Certificates of deposit (CDs)  Money market accounts (blend features of both)