Full formBanking & Finance
CDAstands forCompulsory Deposit Account
Full Form of CDA
What is CDA?
The full form of CDA is Compulsory Deposit Account. It was a special type of bank account introduced by the Government of India in 1974 under the Compulsory Deposit Scheme (CDS). The scheme required individuals with taxable incomes above a certain threshold, initially ₹15,000 per annum, to deposit a portion of their income—typically 4% to 8%—into these accounts. The deposited amount was locked in for a fixed period of five years and earned interest at 8% per annum. The primary objective was to curb inflation by absorbing excess liquidity, promote savings among taxpayers, and mobilize funds for public infrastructure projects. CDA was administered by scheduled banks and non-compliance attracted penalties. The scheme played a significant role in India's fiscal policy during the high-inflation 1970s and early 1980s, functioning as a compulsory savings tool distinct from voluntary instruments like PPF. However, it was discontinued in 1985 as tax reforms made it redundant. Today, CDA is primarily of historical importance for banking and economics students. For competitive exams such as RBI Grade B, NABARD, and UPSC, questions on CDA occasionally appear under Indian banking history, helping aspirants understand the evolution of savings and tax-compliance mechanisms in the country.
CDA का फुल फॉर्म
अनिवार्य जमा खाता
Example
In 1980, my grandfather had to open a CDA account because his annual income exceeded the taxable threshold set by the government.
CDA — frequently asked questions
What is the full form of CDA?
CDA stands for Compulsory Deposit Account, a type of savings account introduced by the Indian government in 1974.
Is CDA still valid in India?
No, the Compulsory Deposit Scheme was discontinued in 1985 and these accounts are no longer issued.
What was the interest rate on CDA?
The Compulsory Deposit Account offered an interest rate of 8% per annum during its operation.