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What is the difference between a Fixed deposit and a Cumulative deposit ?

April 26, 2017cumulative deposit difference fixed

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What is the difference between a Fixed deposit and a Cumulative deposit ?

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In Fixed deposit scheme, interest is payable at specified frequencies. The scheme will be convenient for persons like pensioners, who require periodical interest payment. In Cumulative deposit scheme, interest is payable at the time of maturity along with the principal. This scheme is suitable for persons who do not require periodical interest payment and this can be thought of as a money multiplier scheme.