Certificates of this type are becoming more and more popular every year among the population and among large financial organizations. They are convenient and have a number of features that allow you to get significant benefits from the use of financial instruments.
What is a certificate of deposit
The description of this concept is indicated in the Civil Code of the Russian Federation. In short, a bank certificate of deposit is a security that confirms the fact of depositing and storing a certain amount of funds into a banking organization by a legal entity or individual. The period of validity of this document, storage conditions, repayment, interest rate and any other required information are also indicated there.
Securities of this type have many varieties and subspecies, which may differ from each other depending on which particular person contributed funds, how and on what conditions.
Release Features
Not all banks work with similar financial instruments. However, those who nevertheless provide their customers with such an opportunity, issue certificates of deposit in a strictly defined way. So, the rules for carrying out such operations are carefully prescribed in the legislation. In total, there are two types of release options - one-time and permanent. In the first case, an exception is made for one specific client, and he receives a unique security intended only for him, specially issued for such a case.
Most often, this attitude is only for truly valuable for the bank legal entities or individuals that can have a significant impact on the income of a financial institution. The second option is intended for a large mass of people or enterprises. These are simple forms, even if fulfilled with all the requirements of the law, into which, if necessary, certain data is entered, after which the certificate of deposit is transferred to the depositor.
Repayment of certificates of deposit
The main difference between these securities from the usual bank deposit agreement is the ability to transfer the document itself to another person, who gets the opportunity to withdraw the funds indicated in the paper, regardless of who they actually belong to. Thus, the procedure for redeeming these certificates is not particularly difficult. You just need to bring a certificate of deposit to the bank, present it to the manager and request a refund of the funds indicated in it.
Types and forms
All issued papers of this type are divided into several types and varieties. Some believe that a bill of exchange and certificates of deposit are one and the same thing, but in reality they are different things.
For example, the first document most often does not have a specific expiration date, as well as any special conditions for storing funds. That is, it can freely withdraw money at any time. The second document most often has an expiration date and indicates certain conditions, such as interest received by the owner. Among other things, such securities are registered and those that work with any bearer. The former implies that only the person in whose name the paper is written can receive the funds. The second has a wider application, and it can be cashed by absolutely any person who currently owns the certificate.
Savings certificate
Among other things, such securities are further divided into those issued to individuals and those that are aimed at legal entities. In this case, the names differ. For example, if the word “savings” comes first, then this document is intended for an individual. The main difference from paper, which is focused on legal entities, is that upon repayment the amount can be received not only in cash, but also in cash.
The most common example of such financial instruments is a deposit certificate of Sberbank. Some other banking organizations also issue such securities, but the Savings Bank is the most popular and demanded.
Deposit document
A certificate of deposit is a tool that is already intended for legal entities. In general, there are no special differences from the previous one, except that all repayment options are available exclusively in non-cash form. It should also be noted that most often such certificates are issued in the “bearer” version and can serve as a means of settlement between different organizations and their representatives for goods or services received.
Design Features
Any official document has rules for filling in different fields, rows and tables prescribed by law. This also applies to such a security as a certificate of deposit. Moreover, the first restrictions arise even at the issue stage, because the only currency in which these documents can be is the Russian ruble. At the same time, both a Russian citizen and a person with or without other citizenship can receive funds under a certificate. The type of document, its series and number, as well as the date when the amount was paid, must be registered on the security. The amount of funds itself is also prescribed in this paper together with a clearly stated obligation of the financial organization to return the money under certain conditions.
The certificate also indicates the validity period, percentage and data of the organization that issued the paper. Naturally, all required signatures and stamps should also be there. An interesting feature is that it is not written anywhere what data on the document should not be, so if desired, the recipient of the certificate may require to specify some unique data that may have one or another relation to the potential future owner of the funds, the features of their return, and so on . If the certificate is of a registered type, all owner data must appear in it.
disadvantages
Like any financial instrument, certificates have certain disadvantages. They are not too safe for open storage, especially if issued "bearer". That is, if a third party has seized this security in one way or another, it can withdraw all money without any restrictions and absolutely legally. Another point is taxes. The funds received under the certificates are taxed as on ordinary income of individuals, which is not very profitable in most situations.
The last and most important negative factor is deposit insurance system. A regular deposit is also involved in it in case of any problems with the banking organization where it was stored. But the certificate of deposit is not involved in this, and in case of problems the only way to return yours remains only the court.
The overall result
In general, the use of such settlement tools between individuals or legal entities is an interesting and convenient opportunity. It has certain disadvantages, but there are enough advantages. In any case, this option must be taken into account and, possibly, even actively used in certain situations when other types of financial instruments will be unprofitable or inaccessible.For the best use of this possibility of storage and transfer of funds, it is recommended to study the conditions and requirements of various financial organizations and only make the final decision based on the results of such a study.
