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Question
Distinguish between the following:
Current account & Recurring deposit account
Solution
| Basis of Difference |
Current Account | Recurring Account |
| Meaning | It is opened by business persons 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. |
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