Daily Periodic Rate
The interest rate factor used to calculate the interest charges on a daily basis. The factor is computed by dividing the yearly rate by 365 days.
Debit Card
A plastic card issued by a Bank for cash withdrawal from a/c(s) through ATMs and payments at point of sale for purchases made. Debit Card denotes immediate debit to the customer's account.
Debt
An amount of money you owe to banks or credit issuers. More specifically, it is the amount of money that you have borrowed.
Debt Ratio / Debt Burden
An amount of money you owe to banks or credit issuers. It is the percentage of your income that goes to paying your debts every month. Debt ratio usually gives a clear picture of your overall financial well-being. To calculate your debt ratio, first add up all your monthly income including take-home pay (after taxes). Then add up all your monthly payments for interest bearing loans and accounts, such as mortgages, student loans, credit cards and car loans. If you rent your home, include that amount, but do not include utilities and telephone charges because they can vary on a monthly basis. Finally, divide your monthly payments by your income. Multiply the result by 100 and that number is your debt ratio percentage.
*A low ratio is under 20%, which means that you are in good financial health and are doing a good job of managing your money.
*A moderate ratio is between 21% and 40%. This means that you should look carefully at your monthly payments and start decreasing your overall level of debt, including credit cards.
A high debt burden is over 40%. You should immediately stop accumulating debt and start looking for ways to decrease your debt or increase your income.
Default
Failure to repay a loan according to the agreed upon terms.
Deferred Payment
Payments put off to a future date or extended over a period of time. Interest will usually still accumulate during deferment.
Deferred Tax Assets
Unabsorbed depreciation and carry forward of losses which can be set-off against future taxable income which is considered as timing differences result in deferred tax assets. The deferred Tax Assets are accounted as per the Accounting Standard 22.
Deferred Tax Liabilities
Deferred tax liabilities have an effect of increasing future year's income tax payments, which indicates that they are accrued income taxes and meet definition of liabilities.
Delinquency
When loan payments are not paid according to the terms of the agreement / promissory note. Late fees are often levied on delinquent accounts.
Deposit
Money placed in a customer's account at a Bank / Financial Institution.
Deposit at Call
Receipts issued to customers for amount deposited and repayable on demand. A facility normally extended for payment of earnest money deposits in tenders.
Depreciation
Depreciation means a decline in the value of capital asset. It represents a cost of ownership and the consumption of an asset over time.
Derivative
A derivative instrument derives its value from an underlying product. There are basically three derivatives :
a) Forward Contract : A forward contract is an agreement between two parties to buy or sell an agreed amount of a commodity or financial instrument at an agreed price, for delivery on an agreed future date. Future Contract - Is a standardized exchange tradable forward contract executed at an exchange. In contrast to a futures contract, a forward contract is not transferable or exchange tradable, its terms are not standardized and no margin is exchanged. The buyer of the forward contract is said to be long on the contract and the seller is said to be short on the contract.
b) Options : An option is a contract which grants the buyer the right, but not the obligation, to buy (call option) or sell (put option) an asset, commodity, currency or financial instrument at an agreed rate (exercise price) on or before an agreed date (expiry or settlement date). The buyer pays the seller an amount called the premium in exchange for this right. This premium is the price of the option.
c) Swaps : Is an agreement to exchange future cash flow at pre-specified Intervals. Typically one cash flow is based on a variable price and other on affixed one.
Detailed Statement
The detailed statement of account depicts the details of the transactions in the account (ie. Loan disbursal, EMI credit, interest debit, unpaid return of EMI, penal interest debit, if any, etc.).
Disclosure
Information pertaining to the account services, fees and regulatory requirements.
Disclosure Statement
A disclosure statement details the actual cost of a loan, including all estimated interest costs and loan fees. For credit card accounts, this information may be found in the Card member Agreement.
Disposable Income
Disposable income is the amount of income left after deductions such as income tax, pension contributions and personal insurance. It is often known as 'take home pay' - the actual pay a worker receives.
Documentation
The legal or other papers to be signed and presented during the loan process. It is also called the loan papers.
Dormant Account (In operative account)
A bank account in which there have not been any transactions for two years.
Doubtful Asset
An asset would be classified as doubtful if it has remained in the substandard category for a period of 12 months. A loan classified as doubtful has all the weaknesses inherent in assets that were classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, - on the basis of currently known facts, conditions and values - highly questionable and improbable.
Down Payment
The amount, which has to be paid by the borrower upfront while taking a loan. This amount is generally 10%-15% of the total fund required. It is also called the margin amount or margin money.
Draft
A written, signed and dated order from one Branch of a Bank to another , to pay a sum of money to a specific party.
Drawee
The person or entity on whom a draft / bill is drawn by the drawer.
Drawer
The party who draws or issues the draft / bill. In a Letter of Credit it is the Beneficiary. The person who makes or draws a bill of exchange or cheque is called drawer.
Due Date
The day a payment is due to a payee / creditor. After that date, a late fee can be charged, the payment can be recorded as late, and the account considered overdue / delinquent.
The interest rate factor used to calculate the interest charges on a daily basis. The factor is computed by dividing the yearly rate by 365 days.
Debit Card
A plastic card issued by a Bank for cash withdrawal from a/c(s) through ATMs and payments at point of sale for purchases made. Debit Card denotes immediate debit to the customer's account.
Debt
An amount of money you owe to banks or credit issuers. More specifically, it is the amount of money that you have borrowed.
Debt Ratio / Debt Burden
An amount of money you owe to banks or credit issuers. It is the percentage of your income that goes to paying your debts every month. Debt ratio usually gives a clear picture of your overall financial well-being. To calculate your debt ratio, first add up all your monthly income including take-home pay (after taxes). Then add up all your monthly payments for interest bearing loans and accounts, such as mortgages, student loans, credit cards and car loans. If you rent your home, include that amount, but do not include utilities and telephone charges because they can vary on a monthly basis. Finally, divide your monthly payments by your income. Multiply the result by 100 and that number is your debt ratio percentage.
*A low ratio is under 20%, which means that you are in good financial health and are doing a good job of managing your money.
*A moderate ratio is between 21% and 40%. This means that you should look carefully at your monthly payments and start decreasing your overall level of debt, including credit cards.
A high debt burden is over 40%. You should immediately stop accumulating debt and start looking for ways to decrease your debt or increase your income.
Default
Failure to repay a loan according to the agreed upon terms.
Deferred Payment
Payments put off to a future date or extended over a period of time. Interest will usually still accumulate during deferment.
Deferred Tax Assets
Unabsorbed depreciation and carry forward of losses which can be set-off against future taxable income which is considered as timing differences result in deferred tax assets. The deferred Tax Assets are accounted as per the Accounting Standard 22.
Deferred Tax Liabilities
Deferred tax liabilities have an effect of increasing future year's income tax payments, which indicates that they are accrued income taxes and meet definition of liabilities.
Delinquency
When loan payments are not paid according to the terms of the agreement / promissory note. Late fees are often levied on delinquent accounts.
Deposit
Money placed in a customer's account at a Bank / Financial Institution.
Deposit at Call
Receipts issued to customers for amount deposited and repayable on demand. A facility normally extended for payment of earnest money deposits in tenders.
Depreciation
Depreciation means a decline in the value of capital asset. It represents a cost of ownership and the consumption of an asset over time.
Derivative
A derivative instrument derives its value from an underlying product. There are basically three derivatives :
a) Forward Contract : A forward contract is an agreement between two parties to buy or sell an agreed amount of a commodity or financial instrument at an agreed price, for delivery on an agreed future date. Future Contract - Is a standardized exchange tradable forward contract executed at an exchange. In contrast to a futures contract, a forward contract is not transferable or exchange tradable, its terms are not standardized and no margin is exchanged. The buyer of the forward contract is said to be long on the contract and the seller is said to be short on the contract.
b) Options : An option is a contract which grants the buyer the right, but not the obligation, to buy (call option) or sell (put option) an asset, commodity, currency or financial instrument at an agreed rate (exercise price) on or before an agreed date (expiry or settlement date). The buyer pays the seller an amount called the premium in exchange for this right. This premium is the price of the option.
c) Swaps : Is an agreement to exchange future cash flow at pre-specified Intervals. Typically one cash flow is based on a variable price and other on affixed one.
Detailed Statement
The detailed statement of account depicts the details of the transactions in the account (ie. Loan disbursal, EMI credit, interest debit, unpaid return of EMI, penal interest debit, if any, etc.).
Disclosure
Information pertaining to the account services, fees and regulatory requirements.
Disclosure Statement
A disclosure statement details the actual cost of a loan, including all estimated interest costs and loan fees. For credit card accounts, this information may be found in the Card member Agreement.
Disposable Income
Disposable income is the amount of income left after deductions such as income tax, pension contributions and personal insurance. It is often known as 'take home pay' - the actual pay a worker receives.
Documentation
The legal or other papers to be signed and presented during the loan process. It is also called the loan papers.
Dormant Account (In operative account)
A bank account in which there have not been any transactions for two years.
Doubtful Asset
An asset would be classified as doubtful if it has remained in the substandard category for a period of 12 months. A loan classified as doubtful has all the weaknesses inherent in assets that were classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, - on the basis of currently known facts, conditions and values - highly questionable and improbable.
Down Payment
The amount, which has to be paid by the borrower upfront while taking a loan. This amount is generally 10%-15% of the total fund required. It is also called the margin amount or margin money.
Draft
A written, signed and dated order from one Branch of a Bank to another , to pay a sum of money to a specific party.
Drawee
The person or entity on whom a draft / bill is drawn by the drawer.
Drawer
The party who draws or issues the draft / bill. In a Letter of Credit it is the Beneficiary. The person who makes or draws a bill of exchange or cheque is called drawer.
Due Date
The day a payment is due to a payee / creditor. After that date, a late fee can be charged, the payment can be recorded as late, and the account considered overdue / delinquent.
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