What is a deposit? Types of deposits and their features

There is never too much money: the more we earn, the more we spend. But, some lucky ones manage to accumulate a tidy sum. If you are one of them, then you will certainly wonder where to spend it.

There are a lot of ways, but you need to think about everything carefully. If you want your money to work for you, then you can try to go into business. However, not everyone is endowed with a talent for entrepreneurial activity and is likely to fail.

As an option, you can consider the temporary placement of capital in a deposit account. What's the use? Firstly, the money will be stored in a safe place that intruders will not be able to penetrate. Secondly, there will be an opportunity to earn some extra money at the expense of the deposit rate that the bank will pay.

In this article, we will consider in detail what types of this service is, its features and conditions.

The emergence of deposits

The banking system has not always been as developed as it is now. For example, until the 19th century, not a single bank existed in Russia, and even more so, no one knew what a deposit was.

At a time when only writers could dream of a monetary currency, people carried out trading operations mainly in gold, bronze or silver coins.

As now, so then, there were wealthy gentlemen who had wealth in large quantities. They hired guards who were supposed to protect their property day and night from the attempt of thieves, who for the most part were simple workers without an extra piece of bread.

As you know, there is no supply without demand, and in ancient Greece, special savings cells began to appear in temples. It was possible to store your property in them, paying in advance for this service.

In the process of evolution of financial relations, in Europe they began to pay merchants for placing their funds with the so-called first bankers. This can be considered the appearance of the first deposits, which to this day are quite popular.

What is a deposit?

This is a deposit that is placed on a special account. For the fact that a person has entrusted and placed his funds on a deposit, the bank or other financial institution in which the account is opened charges a premium (interest) on the amount of the deposit.

This benefits both parties:

the investor has placed his funds in a safe place, he does not worry about their safety;
at the expense of the old capital, the investor earns a new one;
the bank receives liabilities that it can use to lend to customers.

Of course, the current interest on deposits does not allow you to earn in the full sense of the word. But they are capable of reducing the negative impact of inflation and have proven themselves well in practice.

Types of deposits

We continue to understand what a deposit is, consider the existing types of deposits.

According to the validity period, deposits can be divided into the following positions:

Short term (up to 3 months).
Medium-term (from 3 to 6 months).
Long-term (more than 6 months).

Often, banks are interested in long-term liabilities, so deposits with a term of more than 6 months have higher rates compared to others. An exception may be the plight of a particular financial institution that lacks the money supply. In this case, banks prefer to create favorable conditions and raise rates specifically for short-term deposits.

For the population and enterprises

Depending on the type of person who is the depositor, banks open:

deposits to individuals;
contributions to legal entities.

Often, the population is offered to place deposits with a higher interest rate than firms and enterprises. This is done in order to attract as much money as possible from individuals.

Banks are interested in this, as firms and enterprises cannot keep their funds in a savings account for a long time. Financial institutions need long-term liabilities, so they are trying to attract the maximum number of deposits at the expense of the population.

Interest accrual

Depending on the method of calculating interest, deposits exist:

with capitalization;
without capitalization.

Typically, deposits have capitalization, which can be replenished at any time, and there are no restrictions on withdrawals until the expiration of the banking service agreement. Thus, the amount of the deposit is constantly recalculated and interest is charged only on the balance.

For deposits without capitalization, the rates are always higher. This is due to the fact that such deposits have a fixed term and do not imply the possibility of withdrawal or replenishment, which is more beneficial for the bank.

Which deposit to choose?

Based on the list of types of deposits listed above, it can be said that each bank has a wide range of financial services offered.

For example, Sberbank deposits are represented by the following list:

"Save."
"Replenish".
"Manage".
"Gift a life".
"Multicurrency deposit of Sberbank of Russia".
"International".
Savings account.

Financial institutions are trying to create the maximum number of possible options so that a potential client can choose the appropriate type of deposit for himself.

The main points that you should pay attention to when choosing a banking product should be:

interest rate;
bank reputation;
transparent terms of service.

Interest on deposits indicates the current market situation and the stability of the position of the financial institution that offers them. If the rate level differs sharply from the average offers of other banks, then this may indicate an unstable position or a violation of the financial component.

Deposits today play a special role: they help to save and increase funds. In this matter, it is very important to trust your money to those banks that have a reputation for being reliable. No one wants to deposit funds into an account at a financial institution about which little is known.

Transparent terms of service mean no hidden commissions on deposits. For example, they are possible with a cashless transfer from other accounts, as well as with the issuance of cash from the cash desk.