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Know About Question on different types of Accounts and Instruments
How many different types of Accounts and Instruments are in the bank?
Traditionally banks in India have four types of deposit accounts, namely Current Accounts, Saving Banking Accounts, Recurring Deposits and, Fixed Deposits. However, in recent years, due to ever-increasing competition, some banks have introduced new products, which combine the features of the above two or more types of deposit accounts.(Different types of Accounts and Instruments)
What is different between a saving account and a current account?
Saving accounts are one of the most popular deposits for individual accounts. These accounts not only provide cheque facilities but also have a lot of flexibility for deposits and withdrawal of funds from the account. Most of the banks have rules for the maximum number of withdrawals in a period and the maximum amount of withdrawal. However, banks have every right to enforce such restrictions if it is felt that the account is being misused as a current account. Till 24/10/2011, the interest on Saving Bank Accounts was regulated by RBI and it was fixed at 4.00% on a daily balance basis. However, wef 25th October 2011, RBI has deregulated Saving Fund account interest rates and now banks are free to decide the same within certain conditions imposed by RBI.
Information About Question on different types of Accounts and Instruments
Current Accounts are basically meant for businessmen and are never used for the purpose of investment or savings. These deposits are the most liquid deposits and there are no limits for the number of transactions or the number of transactions in a day. Most of the current accounts are opened in the names of firm/company accounts. A checkbook facility is provided and the account holder can deposit all types of cheques and drafts in their name or endorsed in their favor by third parties. No interest is paid by banks on these accounts. On the other hand, bank charges certain service charges, on such accounts.(Different types of Accounts and Instruments)
What is BSBDA?
- Under the guidelines issued on August 10, 2012, by RBI: Any individual, including the poor or those from weaker section of the society, can open a zero balance account in any bank. BSBDA guidelines are applicable to “all scheduled commercial banks in India, including foreign banks having branches in India”.
- All the accounts opened earlier as ‘no-frills’ accounts should be renamed as BSBDA. Banks are required to convert the existing ‘no-frills’ accounts’ into ‘Basic Savings Bank Deposit Accounts.
- The ‘Basic Savings Bank Deposit Account’ should be considered as a normal banking service available to all customers, through branches.
- The aim of introducing ‘Basic Savings Bank Deposit Account’ is very much part of the efforts of RBI for furthering Financial Inclusion objectives.
What is Cheque?
A cheque is a negotiable instrument instructing a Bank to pay a specific amount from a specified account held in the maker/depositor’s name with that Bank. A bill of exchange drawn on a specified banker and payable on demand.“Written order directing a bank to pay money”.
What is a Demand Draft?
A demand draft is an instrument used for effecting the transfer of money. It is a Negotiable Instrument. Cheque and Demand-Draft both are used for the Transfer of money. You can 100% trust a DD. It is a banker’s check. A check may be dishonored for lack of funds a DD can not. A cheque is written by an individual and a Demand draft is issued by a bank. People believe in banks more than individuals.
What is the difference between Cheque and Demand Draft?
- A cheque is a negotiable instrument instructing a bank to pay a specific amount from a specific account held in the maker/depositor name with that Bank. Issuer account balanced once check is honored and credited to the receiver bank account. A cheque can be bounced.
- A demand draft is an instrument used for effecting the transfer of money. It is a negotiable instrument. Balance is deducted from the account once Draft is issued from the account. DD cannot be bounced.(Different types of Accounts and Instruments)
#Different types of Accounts and Instruments
@different types of Accounts and Instruments
Different types of Accounts and Instruments
Different types of Accounts and Instruments
Different types of Accounts and Instruments
Different types of Accounts and Instruments
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