Bank deposits in plain words: what to know before opening one
A deposit is the simplest way to keep money safe. How deposits differ, what interest and capitalisation mean and what to look for in the contract. · 5 min read
How a deposit works
You give the bank money for a set term, and the bank pays you interest for it. The rate is annual: 6% a year on 10,000 lei is about 600 lei over a year, before taxes and the contract's conditions.
This article explains general concepts and is not a recommendation to choose a specific bank or product. Compare the current terms of several banks yourself.
Terms you will see in the contract
- Term: how many months the deposit is opened for. Longer terms usually pay a higher rate.
- Early withdrawal: whether you can take the money out early and what then happens to the interest.
- Capitalisation: interest is added to the deposit, so next time interest is earned on a larger amount.
- Top-ups and partial withdrawals: whether they are allowed.
- Currency: deposits can be in lei or foreign currency, with different rates and different risks.
- Tax on interest income — check whether the bank withholds it for you.
Guarantees
In Moldova, individuals' deposits in banks are guaranteed up to a limit set by law. Before opening a large deposit, check the current guarantee limit and, if your amount is larger, consider splitting it between banks.
Deposits and your goals
A deposit suits money you will not need in the coming months — for example, savings for a big goal. For an emergency fund, quick access matters more than the rate. Add the deposit as a separate account in your tracker so your total balance is complete, and a savings jar shows how much is left to the goal.