Distinguish between:Current Deposit and Fixed Deposit. (2024)

Standard XII

Economics

The difference between the current deposit account and fixed deposit account are as follows:

1. Current deposit account is a type of bank account which is opened by the people in order to do business transaction which is why it is also known as business account whereas a fixed deposit account refers to the type of bank account where a fixed sum of money is deposited in the bank for a fixed period of time.

2. The current deposit account has nominal rate of interest irrespective of the sum of money deposited whereas the rate of interest is quite high in fixed deposit account as it is directly proportional to the sum of money deposited.
3. The current deposit account can be operated with lesser sum of money while fixed deposit account requires a high sum of money to be operated.

4. The current deposit account is of continuous nature and can be operated for any number of years while in fixed deposit account, the sum of money is paid to the depositor after a fixed period along with the accrued interest.

5. In current deposit account withdrawals are allowed throughout the tenure of the account whereas in fixed deposit account, withdrawals are not permitted until the expiry of the fixed period.

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