Commercial Applications
Answer
Distinction between Fixed Deposit Account and Recurring Deposit Account
| S.No. | Basis of Distinction | Fixed Deposit Account | Recurring Deposit Account |
|---|---|---|---|
| 1. | Objective | To earn interest on lumpsum savings. | To save regularly and earn interest. |
| 2. | Frequency of deposits | Only one deposit at a time (lumpsum). | Fixed regular monthly deposits. |
| 3. | Period of deposit | Fixed period (e.g., 1, 3 or 5 years). | Fixed period (12 to 72 months). |
| 4. | Rate of interest | Higher rate of interest. | Moderate rate of interest. |
| 5. | Withdrawal | Only on maturity date. | Only on maturity date. |
| 6. | Document issued | Fixed Deposit Receipt is issued. | Pass book is issued. |