Fixed Deposits vs. Deposits: What’s the Difference?
Individuals can save money by using deposits and fixed deposits, which are provided by banks. The money in fixed deposits is locked in for a set length of time, but the money in deposits must be deposited every month for a set period of time. Both RDs and FDs can be opened online using mobile banking apps or online banking.
The characteristics, deposit requirements, tenure, interest rates, advantages, limitations, and other differences between fixed deposit and deposit are discussed below. In this article, we’ll look at what a deposit and a fixed deposit are, as well as their benefits, features, and distinctions between the two types of accounts.
What is a Deposit Account, and how does it work?
A deposit is a type of term deposit that banks offer to their clients. It enables customers with a regular source of income to deposit a set amount of money into a deposit account every month. When a consumer deposits money, he or she becomes eligible to earn interest on it.
A deposit account requires one to send the amount on a regular basis for a pre-decided time
People’s saving habits are encouraged when they have a deposit account.
Short-term, mid-term, and long-term deposit accounts are available. The interest paid by the bank will vary depending on the term chosen.
Banks offer a variety of deposit options for regular people and children.
What are the Advantages and Disadvantages of a Deposit Account?
The benefits of a deposit account that make it a better alternative for saving for the future are as follows:
A monthly minimum deposit of NRs. 500 is required to open a deposit account (the amount might vary from one bank to another)
The minimum term for opening a deposit account is six months, with a maximum term of ten years.
An individual account user can open multiple deposit accounts.
Minors can also open deposit accounts, but they must be supervised by their parents or guardians.
It is not possible to withdraw a portion of the money placed in a deposit account.
How can I open an online deposit account?
The following are the steps that must be followed by the user in order to open a deposit account online:
Log in to the banking app on your phone.
Go to ‘Open deposit account option,’ ‘investment option,’ or any other choice connected to the current deposit account opening.
Select the amount to be deposited, the duration, and the deposit account type.
Enter the date for the amount to be deducted every month.
Click ‘proceed’ or’ submit’ to continue.