Certificate of Deposit (CD) is a
money market instrument. CDs can be issued by scheduled commercial banks and select
All-Country Financial Institutions (FIs) that have been permitted by BB to
raise short-term resources. Minimum amount of a CD should be Rs.1 lakh, i.e.,
the minimum deposit that could be accepted from a single subscriber should not
be less than Tk.1 lakh and in multiples of Tk. 1 lakh thereafter.
The maturity period of CDs issued by
banks should not be less than 7 days and not more than one year, from the date
of issue. CDs may be issued at a discount on face value.
In this, a person invests his money in
COD and after the end of maturity period he receives money along with interest.
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