Visit a nearby bank branch in your locality and collect information about various types of account available for customers to open as per their requirement. In the second part of the activity match the information given in column A with the information given in Column B.
| S. No. | Column A | Column B |
|---|---|---|
| 1. | Multiple Option Deposit | It is a temporary pass through account held by a third party during the process of a transaction between two parties unless the transaction is completed. |
| 2. | Savings Account | A kind of deposit scheme introduced by different banks, where the excess amount in the savings bank account is transferred to fixed deposit account and the account holder earns more rate of interest. If the bank receives a cheque for this account and the balance is not sufficient, the amount will be transferred from fixed deposit account to savings bank account to clear the cheque. In short, it gives the account holder the interest of a term deposit with the flexibility of partial withdrawal, whereas, the remaining cash will get better interest. |
| 3. | Current Account | It is also called cumulative deposit scheme. Any resident, individual, association, club, institution/agency is eligible to open this account in single/joint names. The account can be opened for any period ranging from 6 months to 120 months, in multiple of 1 month for monthly installment. The amount selected for installment at the start of the scheme is payable every month and the number of installments once fixed, cannot be changed. The rate of interest is compounded quarterly and the final amount is paid on maturity. |
| 4. | Fixed Deposit Account | Any resident, individual, association, club, etc., is eligible for this account. It is a kind of modest credit option available to the depositor. Two free cheque books will be issued each year. Internet banking facility will be provided without any charge. Balance enquiry, NEFT, bill payment, mobile recharge, etc., are provided through mobile phones. Students can open this account with zero balance by providing the required documents. |
| 5. | Demat Account | This account can be opened by any resident, individual, association, limited company, religious institution, educational institution, charitable institution, club, etc. Payments can be done unlimited number of times. Funds can be remitted from any part of the country to the corresponding account. Overdraft facility and Internet banking facility are available. |
| 6. | Escrow Account | It is classified as short deposit receipt and fixed deposit receipt |
| a. Short Deposit Receipt | ||
| (i) Banks accept deposits from customers varying from 7 days to a maximum of 10 years. | ||
| (ii) The period for 'short deposits' can vary from 7 days to 179 days. | ||
| (iii) The minimum amount that can be deposited under this scheme is Rs. 5 lakh for a period of 7-14 days. | ||
| b. Fixed Deposit Receipt | ||
| (i) Any resident, individual, association, minor, society, club, etc., is eligible for this account. | ||
| (ii) The minimum FDR in metro and Urban branches is Rs. 10,000 and in rural and semi-urban and for senior citizens is Rs. 5000. | ||
| (iii) Interest rate differs from bank to bank depending upon the tenure of the deposits and as bank changes the rate. | ||
| (iv) Additional interest of 0.50% is offered to senior citizens on deposits placed for a year and above. | ||
| 7. | Recurring Deposit Account | (i) This account offers stress-free transactions on the shares. |
| (ii) An individual, Non-Resident Indian, foreign institutional investor, foreign national, corporate, trusts, clearing houses, financial institution, clearing member, mutual funds, banks and other depository account. | ||
| (iii) For opening this account, an applicant requires to fill a form, submit his/her photo along with a photocopy of Voter ID/Passport/Aadhar Card/Driving Licence and a Demat account number will be provided to the applicant immediately after the completion of processing of the application. |
The correct matching is as follows:
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Multiple Option Deposit – A kind of deposit scheme introduced by different banks, where the excess amount in the savings bank account is transferred to fixed deposit account and the account holder earns more rate of interest. If the bank receives a cheque for this account and the balance is not sufficient, the amount will be transferred from fixed deposit account to savings bank account to clear the cheque.
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Savings Account – Any resident, individual, association, club, etc., is eligible for this account. It is a kind of modest credit option available to the depositor. Two free cheque books will be issued each year. Internet banking facility will be provided without any charge. Students can open this account with zero balance by providing the required documents.
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Current Account – This account can be opened by any resident, individual, association, limited company, religious institution, educational institution, charitable institution, club, etc. Payments can be done unlimited number of times. Overdraft facility and Internet banking facility are available.
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Fixed Deposit Account – It is classified as short deposit receipt and fixed deposit receipt. Banks accept deposits from customers varying from 7 days to a maximum of 10 years. Additional interest of 0.50% is offered to senior citizens on deposits placed for a year and above.
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Demat Account – This account offers stress-free transactions on the shares. An individual, Non-Resident Indian, foreign institutional investor, foreign national, corporate, trusts, clearing houses, financial institution, clearing member, mutual funds, banks and other depository account holders can open this account.
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Escrow Account – It is a temporary pass through account held by a third party during the process of a transaction between two parties unless the transaction is completed.
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Recurring Deposit Account – It is also called cumulative deposit scheme. Any resident, individual, association, club, institution/agency is eligible to open this account. The account can be opened for any period ranging from 6 months to 120 months. The rate of interest is compounded quarterly and the final amount is paid on maturity.
Explanation
This matching exercise tests students' understanding of various types of bank accounts and their features. Each account type serves different purposes: Multiple Option Deposit combines flexibility of savings with higher interest of FD; Savings Account encourages saving habits with modest credit options; Current Account suits businesses with unlimited transactions and overdraft facility; Fixed Deposit Account offers higher interest for fixed tenure; Demat Account facilitates share trading; Escrow Account ensures secure third-party transactions; and Recurring Deposit Account promotes regular monthly savings with compounded interest.
Solution Steps
Step 1: Identify the key features of each account type from Column A.
Step 2: Match each account type with its corresponding description in Column B based on features like eligibility, interest rates, purpose, and facilities.
Step 3: Verify each match by confirming that the description accurately reflects the account type's characteristics.