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There functionality of Deposit Accounts covers typical use-cases of deposit account in microfinance which are Fixed-Term Deposits and Certificate of deposit.
- Fixed-Term Deposit (FD): is money deposited at bank/mfi that cannot be withdraw for a specified term/tenure (unless a penalty is paid). When the term is over it can be withdrawn or it can be held for another term.
- Certificate of Deposit (CD): Certificate deposit is different from that of fixed-term deposit in terms of its negotiability. CD is negotiable and can be rediscounted when the holder needs some liquidity, while time fixed deposit must be kept until maturity.
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- Maturity date: Given commencement date and tenure lenth, maturity date is known.
- Accrued interest on maturity: Given the deposit does last until maturity date as intended, the amount of interest accrued on the deposit over the term can be calculate using algorithm
- Maturity amount: Given the deposit does last until maturity date as intended, this is simply the sum of origin deposit amount and the accrued interest on maturity.
Renewing a Deposit Account
Its typically to allow a customer to renew an existing deposit account on maturity.