The Fixed Deposit (FD) account module enables you to create fully functional fixed deposit accounts with features that allow your customers to deposit a certain amount of money for a specified period of time, apply interest on the accounts, and set in a lock period on an agreed term during which the customer cannot withdraw without incurring a penalty for premature closure.
With the FD account, you can effectively manage and provide your customers with a secure and rewarding fixed deposit account experience.
Note: The FD account is an instance of an FD product under which it is created. As a result, settings and configurations of the FD product automatically apply to all accounts linked with that product.
Similar to a savings account, there are two ways to create a fixed deposit account on the console:
- The Customer (Clients) module
- On the console, navigate to the Business > Clients menu. This page displays a list of all your existing customers.
- Select the desired customer. You can also search for the customer using either the customer's name, CIF number, or external ID. This implies that the customer's account must first exist on the system.
- Navigate to the Fixed Deposit section and click on the New Fixed Account button to create a fixed deposit account. If the customer already has an account(s), the page will display all the FD account they hold in your organization.
- Fill out the fixed deposit account creation form with the required information. See the sections below.
- Account Module
You can also create a fixed deposit account on the Account module.
Note: Using this route, the fixed deposit account can only be created for customers who already have an existing account in your organization. Where this is a new customer, we recommend you create the fixed deposit account using the customer module.
To create an account using the route, follow the steps below:
- On the console, navigate to Account > Deposit menu. This page contains an overview of all deposit accounts (savings and fixed deposits) in your organization, including the account number, balance on the account, and the product type each account belongs to.
- Click on the account name. You can also search for the customer using either the customer's name, account number, or external ID.
- On the customer’s portfolio page, click on the New Fixed Account button.
- Fill out the deposit account creation form with the required information. See the sections below.
- Product: Select an existing product that the account will be associated with. The fixed deposit product must exist prior to account creation.
- Submitted On: Enter the account creation date
IMPORTANT: The submission date is different from the account activation date. An account can be created and remain pending until it is activated.
- Field Officer: Select a field officer from the employee drop-down list.
- Currency: The currency field is automatically filled from the selected fixed deposit product and cannot be modified.
- Decimal Places: The decimal places field is automatically filled from the selected fixed deposit product and cannot be modified.
- Interest Compounding Period: Select the frequency at which the interest earned on an FD account is calculated and added to the amount. Available options include Daily, Monthly, Quarterly, Semi-Annual, and Annual.
- Interest Posting Period: Select the frequency at which interest should be added to the account. Available options include Monthly, Quarterly, Bi-Annual, and Annually.
- Interest Calculated Using: Select the method used to calculate the interest earned on a fixed deposit account.
- Daily Balance: Here, the interest is calculated on the balance in the account each day. The interest earned is added to the account at the end of each day, and the calculation is based on the balance at the end of that day.
- Average Daily Balance: The interest will be calculated on the average balance in the account each day.
- Days In Year: Select an option based on your financial days in a year configuration.
Available options are 365 Days and 360 Days.
- Deposit Amount: Enter the total deposit amount.
- Deposit Period: Also known as the tenure or maturity period. This refers to the length of time for which the account will be active.
- Lock-In Period: Enter a Lock-In Period for each account. During this period, the customer's deposit cannot be withdrawn without incurring a penalty. The lock-in period can be set in Days, Weeks, Months, and Years.
The following fields: Minimum Deposit Term, In Multiples Of, Maximum Deposit Term, Currency In Multiples Of fields, For Premature Closure, and Apply Penal Interest, are automatically filled from the linked product and cannot be modified. Other fields are also populated by default, but they can be modified if needed.
- Transfer Interest To Linked Savings Account: Click on the checkbox to enable interest transfer to a linked savings account
- Link Savings: Select a link savings account to which the interest will be transferred to
- Maturity Instruction: Select the “Transfer to Savings” account option to enable the system automatically transfer the maturity amount(principal + interest) to a select savings account (of the customer) once the account reaches its maturity date.
- Transfer To Savings: Once the Transfer to savings option is selected on the maturity instruction field, a list of the savings accounts the customer has in your organization will be displayed. Select one of the savings accounts to which the maturity amount will be transferred.
- Is Withholding Tax Applicable: Click the checkbox to enable withholding tax on the interest earned on the fixed deposit account.
- Valid From Date: Select a start date for which the interest rate will become active or valid.
For example, if 6th March 2023, is specified as the valid start date, the interest rate will remain valid and in effect.
- End Date: Select an end date for the interest rate for which the interest rate will become ineffective.
- Interest: Enter an interest rate.
Select one or more charges that will be applied to the account. These charges need to be pre-defined in the Charges section. It's worth noting that the Charges section includes a specified due date field, which enables you to set a particular date for the charges to be due and deducted.
A preview will be displayed with all the details. It is important to carefully review the data entered for any errors. Once you are sure the details are correct, you can click the Submit button to finalize the creation of your customer’s deposit account.
The maturity instruction implementation can also be applied to Fixed Deposit Accounts that were created before the maturity instruction feature was introduced to the system. To add this feature, simply close the account, and you will be prompted to choose a savings account, in which the maturity amount will be transferred.
Follow the steps below to add maturity instructions to an existing FD account:
- Select an existing Fixed Deposit Account.
Note: The Account must have an “Active” status.
- Navigate to the Take Action button and select “close” or “premature close”.
- You will be directed to a close account form containing the maturity instruction action. Under the “Action” field, select “Transfer to Savings”.
- On the Transfer to Savings fields, a drop-down list containing the customer's savings account(s) will be displayed. Select a savings account to receive the maturity amount.
- Enter all required details and click the Submit button.
With this implementation, the maturity amount will be automatically sent to the selected savings account.
Updated 7 months ago