Distinguish between the following:
Current account & Recurring deposit account
ANSWER:
Basis of Difference
|
Current Account
|
Recurring Account
|
Meaning
|
It is opened by business people and others who do regular banking transactions.
|
In this type of account, people save a fixed amount regularly for a specific period.
|
Mode of withdrawing money
|
Withdrawal is made through cheques.
|
The customer cannot withdraw the money before the expiry of the fixed period.
|
Preferred by
|
It is preferred by businesspersons, firms and institutions.
|
It is preferred by fixed income group class.
|
Restriction on number of withdrawals
|
There are no restrictions on the number of withdrawals till the balance in the customer’s account is more than that required.
|
The customer can receive the amount only after the expiry of the specified period.
|
Interest rate
|
No interest is given.
|
Interest rate is comparatively higher than that given in the savings account but less than that given in the fixed deposit account.
|
Overdraft facility
|
Overdraft facility is given.
|
Overdraft facility is not given.
|
