BANKING
A bank is an institution which carries on the business on money deposits and money landed.
Bank Deposits :
- Saving bank deposits
- Fixed deposits
- Recurring deposits
- Current
Interest methods for these deposits are different and are as follows :
(a) Saving Bank deposits : Interest is calculated as follows :
- Deposits received upto 10th of every month qualify for payment of interest for the whole month
- After the 10th of any month, interest is given on minimum
Method : Write the minimum balance from the 10th day of each month in a multiple of 10.
For example, if the minimum balance from the 10th day of a month is Rs.250 or less than Rs.250 say it is to be 220. But if it is more than Rs.250 but less than Rs.230, consider it Rs.230.
Add all these balances.
Find simple interest on this sum for 1 month.
Current Account : They deposits of current account do not carry any interest.
There are some extra facilities which are available in current account to the depositors.
Fixed Term Deposit : In this account, the money is deposited for a fixed period and the depositor can withdraw his money only after the expiry of the specified period. The interest rates are different for different terms. If you withdraw the money before the specified period, the interest rate will be calculated for the period in which you are withdrawing the money.
Recurring Deposits or Cumulative Time Deposits : In recurring deposits, a fixed amount (in a multiple of Rs. 10) every month for a specified number of months is deposited. At the end of which he will get back the sum deposited by him along with compound interest. Recurring deposits, generally range for a period of 6 months to 15 years.
Now-a-days people think that the money with the bank is safe. There are two types of banks – Nationalised banks and non-nationalised banks. Nationalised banks are completely safe and most of the people prefer to deposit the money with Nationalised banks. Banks are the safest institutions for your money.
