Banking, mapped
MapGlossary

The spread engine

CASA vs term deposits: why current accounts are "gold"

Cheap current/savings money versus pricey fixed deposits — a cheaper deposit mix means fatter margins.


Why it matters

For an RM, a current-account customer can be worth far more than an FD customer of the same size — and you'll be asked why the bank chases the cheap money.

A worked example

₹10 lakh in a current account costs the bank ₹0 a year; the same in an FD costs ~₹70,000 — same lending, very different profit.

The picture

Current a/c (0%)Savings a/c (~3%)Term deposit (~7%)Deposit mixCost of fundscheapestcheap & stickycostlydetermines

What it leads to

This deposit mix is exactly what sets the bank's cost of funds, which is why branches chase CASA so hard.

Where it sits in the map

Follow the causation