Call Deposit

A call deposit is a type of short-term deposit account where funds are held with a bank or non-banking financial company (NBFC) and can be withdrawn at any time without a fixed maturity period, unlike a fixed deposit which locks money for a set tenure. The term call deposit comes from the ability to call back or withdraw the funds on demand. Interest rates on call deposits are typically lower than fixed deposits but higher than a regular savings account. In the context of credit cards, some issuers or fintech platforms may require a call deposit as a collateral security or fixed deposit lien when issuing a credit card, particularly in cases where the applicant has a limited credit history or is a first-time credit user. The deposit remains in the account but is marked as lien (restricted) and cannot be freely withdrawn while the card is active. If the cardholder defaults, the issuer can appropriate the deposit. The deposit itself continues to earn interest during the lien period, and the full amount is released when the card is closed and all dues are settled.