Financial Education

Workbook
Class:VII
 Financial Education Workbook for Class VII

Disclaimer
This book is presented as a reading and teaching material with a sincere purpose of making
the reader financially literate. It is not intended to influence the reader in making a decision in
relation to any particular financial product/s or service/s.

Published by: The Secretary, Central Board of Secondary Education

Shiksha Kendra, 2, Community Centre,
Preet Vihar, Delhi-110301

Design, Layout & National Institute of Securities Markets (NISM) for

Printed by: National Centre for Financial Education (NCFE)
Plot no. 82, Sector 17, Vashi, Navi Mumbai - 400703
Tel: +91 22-66735100 | Fax: +91 22-66735110
Website: ncfeindia.org
 PREFACE

The CBSE's Financial Education curriculum for classes VI-X, is marked for its strong
dynamism, continuous evolution and development. The curriculum has been
developed by adopting a functional approach. In the current climate of psychological,
social and economic changes, society is influenced by explosive knowledge creation
and exponential technology growth.

The need of financial education is to improve understanding of basic financial concepts

and using them in our daily life. To know about various financial products and to become
more aware of financial risks and opportunities to enable each one of us to make
informed choices, and in return we can improve our financial well-being.

The vision of financial education is that it could enable students, at their level of need, to
understand the role of money in their life, the need and use of savings, the advantages
of using the formal financial sector and various options to convert their savings into
investments, protection through insurance and a realistic recognition of the attributes of
these options.

This financial doctrination will help us learn more about the importance and advantages
of savings, necessity of staying out of unproductive loans that are beyond our capacity
to repay, borrowing with formal financial sector, concept of interest and the power of
compounding, time value of money, inflation, the need to insure, role of major financial
sector institutions such as ministries, regulators, banks, stock exchanges and
insurance companies and basic concept regarding relation between risks and rewards.
Through this we can help ourselves and others in managing money more effectively by
accessing appropriate financial products and services provided by various financial
regulators.

Financial education will help especially those who are financially excluded at present.

The objective of this workbook is to create awareness and educate students on access
to financial services, availability of various types of products and their features and to
make students understand their rights and responsibilities as clients of financial
services.

Teachers handling the course need to inform themselves regarding the effective use of
course content, teaching methodology, management of group work and independent
individual work, management of large classes, appropriate use of assessment tools,
grading and record-keeping to benefit their students.

We would like to thank the stakeholders- Reserve Bank of India, Securities and
Exchange Board of India, The Insurance Regulatory and Development Authority of
India and Pension Fund Regulatory and Development Authority for taking the time and
effort in development of these books.

The development of this book would never have been possible but for the sincere effort,
devotion and leadership of Ms. Sugandh Sharma, Additional Director (Research &
Innovation), CBSE and Mr Sandeep Sethi, Education Officer with his team. Any further
suggestions are welcome and will be incorporated in the future editions.
 Acknowledgment

ADVISORY BODY
Mr. Y.S.K. Seshu Kumar, Chairman, CBSE
Ms. Sugandh Sharma, Additional Director (Research & Innovation), CBSE
Mr. D.T. Sudarshan Rao, Joint Secretary & Incharge (Academics & Training), CBSE

NCFE ADVISORY BODY

Shri Sandip Ghose, Director, NISM Ms. KGPL Ramadevi, Dy. Director, IRDAI
Shri G. P. Garg, Registrar, NISM & Head, NCFE Dr. Minoo Nandrajog, Professor, NCERT
Shri Gyan Bhushan, ED, SEBI Shri Sandeep Sethi, Education Officer, CBSE
Shri A. G. Das, CGM, PFRDA Ms. Poonam Sodhi, Deputy Secretary, CISCE
Shri T V Rao, GM, RBI

MONITORING AND EDITING BOARD

Ms. Sharmila Raheja Ms. Reshu Singhal
Dr. Parul Pathak Ms. Sowdhamani Arvind
Ms. Disha Grover Mr. Sandeep K Biswal
Mr. Shrey Raheja Ms. Renu Anand
Ms. Sareena P. U.

GROUP OF SCHOOLS (Material Production)

Cambridge School, Ghaziabad Kesari Devi Bajaj Public School, Ghaziabad
Delhi Public School, Ghaziabad Modern School, Barakhamba Road, Delhi
Delhi Public School, Indirapuram, Ghaziabad N.H. Goel World School, Chhattisgarh
Delhi Public School, Mathura Road, Delhi Sanskriti School, Delhi
Delhi Public School, Srinagar Seth Anandram Jaipuria, Ghaziabad
Delhi Public School, Vasundhara, Ghaziabad Shiv Nadar School, Noida
DLF Public School, Ghaziabad Uttam School for Girls, Ghaziabad
Gurukul The School, Ghaziabad

Concept and Design by : Jeetendrakumar Solanki, NISM

Poem : Tanessa Puri, R.N. Poddar School, Mumbai
Caricatures : Madhav Gupta, Bal Bharti School, Rohini, Delhi
Script : Maharaja Sawai Man Singh Vidyalaya, Jaipur
Crosswords, Jumbled Words, MCQ's : Reshu Singhal, Adnan Kohli, Sadiq Wazir,
Riya Bhuyan, Divya Aggarwal, Veni Gupta, Mayank
Pugalia, Satvik Bhatt, Aman Surana, Sanket Sharma
and Yatharth Sreedharan
 Index
Subjects Topics Page No.
History 1. Need and Sources of Borrowing 1

2. Role and Functions of the RBI 4

Civics 1. Consumer Protection 7

2. Introduction to Banking 9

Geography 1. Banking: Types of Accounts 13

2. Banking: With New Technology 17

English 1. Living with Means 20

2. The Poor Man's Wealth 22

Mathematics 1. Go for Shopping 24

2. Simple Interest Rates 26

 I, Rashi, will tell you how to calculate simple interest,
sources of borrowing and banking using internet
and mobile.

I, Mudra, will explain the role and functions of the Reserve

Bank of India. I will also teach you cashless shopping.

I am Saif and I am going to protect you as a consumer and

tell you what we should check before making a purchase.

I, Munaf, will introduce you to different types of bank

accounts and banking with new technology and will tell you
about money and peace.

So, let us have fun with crosswords, puzzles, jumbled words and abbreviations.
 AT
nk al
Ba ntr M
Ce

Nuances of
Financial Management
When from banks, money we borrow
We promise to return it after a particular number of tomorrows
There's one rule that binds us all
That is about an interest levied on what we take however big or small

Ac Bank
The Reserve Bank of India plays several roles
With consumer protection, many things the customer controls
co
When dad signed to pay my school fee a cheque
un
I wonder why suddenly he turned into a wreck t
Nowadays the internet helps us pay our dues
As for E-banking we'll learn with some clues
Can we get any- a credit card or
a debit card based on whichever we choose?

Financial education makes me sound smart

Let's try and understand why and not by-heart
In case I get confused, I quickly sketch a chart
That is something that helps set clarity apart

Banks and credit and E-banking and RBI

It is difficult but fun, I won't deny
Some rules with which we need to comply
There's a lot in real life waiting for us to apply

Consumer protection and its nitty gritty

Loan Have you wondered if there is such a committee?
Financial management is becoming a subject so busy
Sim
Inte ple
It forms the core in each and every small and big city.

rest
Class VI Review

Barter

Need Want
Metal Coins
I am thirsty

DoKe

Rupee Note
I am hungry

Plastic Money
 Types of Taxes

Direct Indirect
Taxes Taxes
Income Tax Service Tax
Corporation Tax Sales Tax
Entertainment
Tax

Bill

Now we will take

you to Class VII
We will learn
This was more... Yeah,
Class VI we will have fun.
 Subject: History
Class: VII
Can I borrow a Term: 1
pen from you?

Need and
Sources of
Borrowing

Need of borrowing

One day when Karthik opened his bag he found that he had left his
pen at home. He decided to buy a new pen. The shopkeeper told
him that a new pen would cost him ` 30, but Karthik had only `20
with him. He asked his friend Anil to help him by giving him `10
which he would return the next day. This is an example of
borrowing money. Karthik borrowed `10 from his friend Anil. We
borrow because there is a gap between what we have and what we
need. Karthik borrowed `10 from Anil because he had only `20
while he needed `30 to buy the new pen.

Sources of borrowing

While in the above example Karthik borrowed from his friend Anil,
there are several other sources from which one can borrow money.
We sometimes borrow money from our friends, family, relatives,
etc. These are known as internal sources of borrowing. Apart
from these we borrow money from banks, other financial
institutions and non-institutional lenders e.g. moneylenders,
NBFCs (Non Banking Financial Companies) etc. These are known
as external sources of borrowing.

Loan is a sum of money borrowed from a financial institution and is

repaid with an Interest. Banks accept deposits from people who
have savings and lend to people who need them for various
purposes such as setting up of business, buying equipment for
factory, for purchasing house or for paying for an education. Banks
charge interest on the money lent to the people (which is called as

1
 loan) and this interest forms part of an income to the bank.
Interest is the extra money we pay along with the principal amount borrowed. Let us assume
your father borrows `10000 from a bank. This is known as the principal amount. Now when
your father decides to repay the loan after one year, it is found that he has to give the bank
`11000 . Why do you think your father needs to pay more than what he borrowed? This is
because the bank lent money to your father when he sought it from the bank in the form of a
loan.

Your father paid `1000 extra money to the bank as interest. Commonly, interest is
expressed in percentage terms. In this example we can say that your father paid an interest
of 10% on the loan. This interest amount is an income for the bank.

Exercise

Ram Lal, a farmer wants to buy a tractor. The price of a tractor is ` 3,20,000. However, Ram
Lal has only ` 20,000 with him. He decides to borrow the rest of the amount he needs to buy
the tractor. He goes to a bank and the bank agrees to loan Ram Lal the amount he needs.

Fill in the blanks

1) Gap between what we have and what we need is known as ____________________

2) Borrowing from ____________________ , ____________________ , and

____________________ is known as internal sources of borrowing.

3) Borrowing from ____________________ , ____________________ is known as external

source of borrowing.

4) __________________ is a sum borrowed from a financial institution.

5) We pay ______________ to a financial institution from where we borrow money.

6) Interest is generally expressed in ____________________ terms.

Match the following

1) Income to bank a) Interest percentage
2) Borrowing money from a bank is called a b) Non- Banking Financial Corporation
3) 10% on loan c) Interest on loan lent
4) NBFC d) Loan

2
Jumble
Time

Jumbled Words Clue Solution

Spoh Kpeere Owner of a shop
Brroow Opposite of Lend/may I ……..
Fialancin itIontitusns A group of banks
Lano You may take this from a bank
but have to return it
Iestrtne We get this on our principal
Ppalicnir Original amount

Fun Time
1) ________________ is a sum of money borrowed from a financial
institution and is repaid with an interest.
a) Loan b) Principal
c) Interest d) Money

2) _________________ on loan becomes an income for the bank.

a) Loan b) Principal
c) Interest d) Money

3) __________________ is the extra money we pay along with the principal

amount borrowed.
a) Loan b) Principal
c) Interest d) Sum of money

4) An external source of borrowing money is_______________.

a) money lenders b) family
c) NBFC's d) both (a) and (c)

5) Which one of these is not a valid reason to get a loan from a bank?
a) Setting up a Business b) Purchasing a house
c) Education d) To eat ice cream at ice cream parlour

We can borrow
money from banks
and other financial
institutions

3
 Subject: History
Class: VII
Term: 2
Who governs
all the banks?

Role and
functions
of the RBI

Role and Functions of the RBI

In every country there is one organization which works as the

central bank. The function of the central bank of a country is to
control and monitor the banking and financial system of the
country. In India, the Reserve Bank of India (RBI) is the Central
Bank.

The RBI was established in 1935 and was nationalized in 1949.

The RBI plays the role of a regulator of the banking system in India.
The Banking Regulation Act 1949 and the RBI Act 1935 has given
the RBI the power to regulate the banking system. The RBI has
different functions in different roles. The main functions of RBI are :

▪ Monetary authority
▪ Issuer of currency
▪ Banker and debt manager to Government
▪ Banker to Banks
▪ Regulator and supervisor of the financial institutions
▪ Manager of Foreign Exchange
▪ Regulator and Supervisor of the Payment and Settlement
Systems
▪ Maintaining financial stability
▪ Developmental role

The RBI is responsible for controlling the overall operations of all

banks in India. These banks may be:
▪ Public sector banks
▪ Private sector banks
▪ Foreign banks
▪ Co-operative banks,
▪ Regional rural banks

4
 As a regulator, RBI helps maintain people's confidence in the banking system and also
provides forums for redressing customer's grievances. Along with supervising the banking
system in India, RBI also issues currency notes. However, coins and one rupee notes are
supplied by Government of India and RBI only helps in its distribution. Have you seen that all
currency notes issued by RBI have, “I promise to pay the bearer the sum of
Rupees…..”written on it? This is called the promissory clause and it refers to the Bank's
obligation to pay. While every bank note issued by RBI also has the signature of the RBI
Governor on it, Rupee one notes have the signature of the Finance Secretary, Government
of India.

Exercise

1) What is the name of India's central bank?

----------------------------------------------------------------------------------------------------------------------

2) When was RBI established?

----------------------------------------------------------------------------------------------------------------------

3) Who issues currency notes in India?

----------------------------------------------------------------------------------------------------------------------

4) Who is the present Governor of RBI?

----------------------------------------------------------------------------------------------------------------------

Fill in the blanks

1) The function of the central bank is to ______________ and monitor the ______________
and ______________ system of the country.
2) The _________________________________________ is the Central bank of India.
3) The ______________ and ______________ has given the RBI power to regulate the
Banking system.
4) The ______________ issues currency notes.
5) “I promise to pay the bearer the sum” written on the currency notes is called the
______________

Match the following

1) 1935 a) RBI Governor
2) 1949 b) RBI
3) Banker to banks c) RBI was nationalised
4) Chief executive of RBI d) RBI was established

Jumble
Time

Jumbled Words Clue Solution

Cralten Bnka Controls commercial banks
Rervese Bnka fo Iiand Apex bank of India
Pcilbu Srotce Bkna Bank where a major stake is
held by a government
Patevir Srotec Bkna Bank where greater parts of equity
are held by private shareholders
Fignore Bkna Banks with headquarter in a
foreign country

5
 Fun Time
1) ______________________ is the central bank of India.
a) Reserve Bank of India b) State Bank of India
c) Rupee Bank of India d) Delhi Bank of India

2) RBI was established in ____.

a) 1950 b) 1935
c) 1949 d) 1950

3) ________________ is responsible for controlling the overall operations

of all banks in India.
a) RBI b) SBI
c) RPI d) SPI

4) Banker and debt manager to government of India.

a) SBI b) BOI
c) RBI d) PNB

RBI regulates
all the banks
in India.

6
 Subject: Civics
Class: VII
Out for shopping...
Term: 1
Time to learn

Consumer
protection

Shivansh, a 13 year old boy, loves to accompany his mother for

shopping. He enjoys shopping but feels very bad when he buys
something which stops working or breaks within a week's time after
buying. He then loses confidence in shopping and feels very low.
Please help him and make him aware about his rights as a
consumer.

In general, the consumer rights in India are listed below:

• The right to be protected from all kinds of hazardous goods and
services.
• The right to be fully informed about the performance and quality of
all goods and services.
• The right to free choice of goods and services.
• The right to be heard in all decision-making processes related to
consumer interests.
• The right to seek redressal, whenever consumer rights have been
infringed.

If there is infringement of rights of consumer then a complaint

can be made under the following circumstances:

• The goods or services purchased by a person or agreed to be

purchased by a person has one or more defects or deficiencies in
any respect.
• A trader or a service provider resorts to unfair or restrictive
practices of trade.
• A trader or a service provider charges a price more than the price
displayed on the goods or the price that was agreed upon
between the parties or the price that was stipulated under any law
that exist.

7
 Exercise

Consider the following consumer issues and recommend the consumer rights in
each situation:
1) I bought a shirt but when I came home I changed my mind. I took it back to the shop the
next day but the staff would not give me a refund. Can they do this?
______________________________________________________________________

2) I bought a pair of new shoes but the heel of one shoe broke when I wore them for the
second time. The shop is offering to repair them. Do I have to accept this?
______________________________________________________________________

3) I bought a pair of jeans for `1500 but discovered that a shop down the street was selling
the same brand for ` 1280. What can I do?
______________________________________________________________________

4) My mother washed a pair of trousers that were labeled “hand wash only” in the washing
machine, and they shrunk. What can I do?
______________________________________________________________________

5) I bought a CD player after seeing an advertisement in the local newspaper. When I

brought it home, I discovered that it was not working. What are my rights?
______________________________________________________________________

6) I bought a television set on my birthday but it did not work properly. The shop manager told
me to send it back to the manufacturer, as the shop had nothing to do with the defective
TV set. Is this correct?
______________________________________________________________________
Identify the consumer right violated in the following cases:
1) Ankit purchased a box of crackers from the market but there were no instructions
written on it regarding how to use it. __________________________
2) Sita purchased ghee from the shop but there was no quality mark on the carton.___________
3) Fiona went to a shop to buy toothpaste and the shopkeeper kept insisting her to buy a
particular brand and refused to give her the other available brands. ________________

1) Which of the following is consumer right in India?

a) Right to speak Fun Time
b) Right to be heard
c) Right of full disclosure
d) Right to complaint

We can enjoy
shopping more
using our
consumer rights

8
 Subject: Civics
Class: VII
Term: 2
Bank... keep your
money here.

Introduction
to Banking

Introduction to Banking?

What is a bank?
Bank is an institution which accept deposits and give loans in return
for an interest. Can you name a few banks that operate in India?

Deposit
When bank accepts money from public, it is called a deposit. As
the person is depositing his money, the bank gives him some
benefits in the form of interest.

Loans
When a bank gives money to public for various purposes like
building a house, buying a car, setting up a business, etc, it is called
a loan. Bank charges an interest on the loans.

Credit card
A card issued by a financial institution, usually banks, giving the
holder an option to buy goods and services without making any
actual cash payment. This is a type of short-term borrowing. It
works on the card holder's promise to pay at a later date, varying
from 30 to 50 days. If the holder fails to pay within the stipulated
time period, the issuer of the card charges an interest.

Debit card
An electronic card issued by a bank which allows the card holder
access to his account to withdraw cash or pay for goods and
services. This removes the need for the card holder to go to the
bank branch as they can now just go to an ATM or pay electronically
at merchant locations. This type of card, as a form of payment, also

9
 removes the need for cheques as the debit card immediately transfers money from the
client's account to the merchant's account.

Automated Teller Machine

ATMs are electronic machines, which are operated by a customer himself for availing
various banking services such as cash withdrawals, checking account balance, bill
payments, transfer of funds etc. ATMs provide service round the clock. The customer can
withdraw cash upto a certain limit during any time of the day or night. For using an ATM, a
customer has to obtain an ATM card from his bank. The ATM card is a plastic card, which is
magnetically coded and contains a unique card number and some security information such
as expiry date. It can be easily read by the machine.

To operate an ATM , the customer has to insert the card in the machine and then enter the
Personal Identification Number or PIN. If the authentication or PIN is correct, the ATM
permits a customer to make transactions.

Cheque
Cheques are simply a payment instruction from the account holder to his/her bank directing
to pay a certain sum of money to a specific person or to the bearer of the instrument. On
receipt of cheques, the beneficiary will deposit it with his bank which will collect the money
through clearing house system. Clearing house is a system in which banks in a city
exchange cheques with one another and settle the payments by arriving at a net amount of
payables and receivables. After exchange of cheque, the account of the issuer of the
cheque is debited and the credit is passed on to the beneficiary. An account holder should
ensure that a cheque is issued only when there is sufficient balance of funds in the account.
Cheques drawn on any bank in the country can be cleared through various mechanisms
available in the clearing system. The process usually takes 1-3 days depending on the local
clearing house procedures.

Case study: ATM and its benefits

Mr. Sharma works with an Multinational Company (MNC). Being busy he is not able to
devote time at home. His wife looks after all the household activities. One day while Mr.
Sharma was out of station on an official tour, his mother fell ill and was advised
hospitalization. It was late night and Mrs. Sharma took her mother-in-law to the hospital. She
was worried because she had little money with her. Suddenly she spotted an ATM booth
near the hospital. She immediately took out her ATM card and used it to withdraw money. In
this way she was able to arrange money for the treatment. Thus ATM cards help account
holders withdraw money at any time without the use of cheques.

1) Mrs. Sharma has withdrawn money with the help of a/an

a) ATM card b) credit card
c) cheque d) withdrawal form Fun Time

2) If you want to withdraw money by ATM, you can withdraw,

a) Only in the day time b) Any time
c) Only on week days d) On holidays

10
3) Where have you seen an ATM booth?
a) Inside the banks b) Outside the banks
c) In shopping malls d) All of the above

4) What is the full form of ATM?

a) Automated teller machine b) All time money
c) Any time money d) Advance time machine

5) What are the benefits of having an ATM card?

a) We can save time and it involves less paper work b) You can withdraw money at any time
c) Checking your account balance is easy d) All of the above

Exercise
1) What can a customer do with an ATM card?
______________________________________________________________________
______________________________________________________________________

2) How can a credit card company charge interest to the holder?

______________________________________________________________________
______________________________________________________________________

3) Bank pays an interest on ______________ (deposits or loans).

4) What are the benefits of a debit card?

______________________________________________________________________
______________________________________________________________________

Fill in the blanks:

1) Bank is an institution which accepts ____________ and gives ____________ in
return for an interest.
2) When a person deposits money, the bank gives him some benefits in the form of
____________.
3) When a bank gives money to public for various purposes like building a house or
buying a car, it is called a ____________.
4) Credit card is a form of ____________.
5) If the credit card holder fails to pay within the stipulated time period, the issuer of the
card charges an____________.
6) When a bank issues an electronic card to a person so that he can have access to his
account to withdraw cash or pay for goods and services, it is called a____________.
7) An ____________ allows a customer to withdraw cash 24/7.
8) ____________ is a system in which banks in a city exchange cheques with one
another and settle the payments.
9) Cheque processing usually takes place around ____________ days depending
upon the local clearing house procedures.
10) An account holder should ensure that a cheque is issued only when there
is____________ of funds in the account.

11
 Jumble
Time

Jumbled Words Clue Solution

Dsitope Money deposited in bank
Cditer Cdra A small plastic card issued by a bank
Electronic card issued by a bank
Dtibe Cdra which allows holder access his
account to withdraw cash.
Enicortcel Cdra Eg: Debit Card, Credit Card, etc
Atedamotu llerTe
An electronic banking outlet
Mchaeni

1) When banks accept money from public, it is known as ___________. Fun Time
a) withdrawal b) deposit
c) loan d) acceptor

2) Which among the following creates short-term borrowing?

a) Deposit b) Loan
c) Credit card d) Debit card

3) It is easier to withdraw money using __________.

a) cheque b) credit card
c) debit card d) both (a) and (b)

4) Which one of the following is NOT true:

a) Debit card removes need for cheques. b) We can use debit card only in ATM machine.
c) Bank charges interest on loan. d) ATM card is magnetically coded.

Banks gives us
so many facilities
like Debit Card,
Credit Card, ATM
and Cheque

12
 Subject: Geography
Class: VII
Different accounts Term: 1
for different people?

Banking:
Types of
accounts

Banking: Types of Accounts

Bank is an institution which accepts money from one person as

deposit and lends to other person as loan in return for some
interest. Traditionally banks in India have four types of deposit
accounts namely, Current Account, Savings Bank Account,
Recurring Deposit and Fixed Deposit.

Current Accounts

Current account is mainly opened to run a business such as

proprietorship, partnership firms, public and private companies,
trusts, association of persons, etc. that have a large number of
daily banking transactions, i.e. receipts and/or payments. It is a
non-interest bearing bank account and needs a higher minimum
balance to be maintained as compared to the savings account.
There is no restriction on the number and amount of deposits and
withdrawals made, as long as the current account holder has funds
in his bank account.

Savings Bank Accounts

Savings Bank Account is one of the most popular deposit

accounts for individuals. Saving accounts are opened to
encourage the people to save money and deposit their savings.
Interest is paid on saving accounts which is often nominal. These
accounts can be opened in single or joint names. The savings
account holder is allowed to withdraw money from the account as
and when required. These accounts not only provide cheque
facility but also have a lot of flexibility for deposits and withdrawal

13
 of funds from the account. Most of the banks have rules for the minimum balance
requirement for these accounts.

However, now banks are also required to open Basic Savings Bank Deposit Account
which do not have any minimum balance requirement . The benefit of a savings bank
account over a current account is that money in a savings bank account earns interest.

Recurring Deposit Accounts

Recurring Deposit Accounts are popularly known as RD accounts. Recurring deposit

account is opened by those who want to save regularly for a certain period of time and earn a
higher interest rate than Savings account offers. These are best if you wish to create a fund
for any special occasions such as a college education or buy a car or save for the future. In
recurring deposit account certain fixed amount is accepted every month for a specified
period and the total amount is repaid with an interest at the end of the particular fixed period.
These are suitable for people who do not have large amount of savings, but are ready to
save a small amount every month. No withdrawals are allowed. However, the bank may
allow closing the account before the maturity period. Any default in payment within the
month attracts a small penalty. Recurring Deposit accounts are normally allowed for
maturities ranging from 6 months to 120 months. These accounts can be opened in single or
joint names.

Fixed Deposit Accounts

These are popularly known as FD accounts. The account which is opened for a particular
fixed period (time) by depositing a particular amount (money) is known as Fixed (Term)
Deposit Account. Under fixed deposit account, money is deposited for a fixed period, say
six months, one year or five years. The period of fixed deposits range between 7 days to 10
years. The money deposited in this account cannot be withdrawn before the expiry of the
fixed period. The depositor is given a fixed deposit receipt, which he/she has to produce at
the time of maturity. Withdrawals are not allowed. However, in case of need, the depositor
can ask for closing the fixed deposit account by paying a penalty. The rate of interest paid for
fixed deposit varies (changes) according to amount, period and differ from bank to bank.
Usually fixed deposits are paid in lump sum on the date of maturity. However, most of the
banks also provide a facility to pay interest at the end of every month or quarter. The deposit
can be renewed for a further period.

Do you know that you can also open a bank account? According to Reserve Bank of India
rules, minors above the age of 10 years are allowed to open and operate savings bank
accounts independently. A minor of any age can also open a savings bank or fixed deposit or
recurring deposit account through his/her natural or legally appointed guardian.

Exercise
1) Which type of account can be opened and operated independently by a minor above the
age of 10 years?
______________________________________________________________________

2) What does the term 'fixed' in fixed deposit accounts refer to?
______________________________________________________________________

14
3) What is a savings bank account with no minimum balance requirement called?
______________________________________________________________________

True or False.
1) In recurring deposit accounts you are required to deposit a small amount every
month.________
2) A minor of any age can open a fixed deposit account through his/her natural or legally
appointed guardian. _________
3) Current accounts are most suitable for businessmen.__________

Answer the following questions:

1) Name the different types of bank accounts.
_____________________________________________________________________________
_____________________________________________________________________________

2) Name the account opened by a business firm to run its business on a daily basis.
_____________________________________________________________________________

3) Is there any restriction on the number of transactions made in a current account?

_____________________________________________________________________________

4) Which is a non-interest bearing bank account?

_____________________________________________________________________________

5) Name the most popular deposit account for individuals?

_____________________________________________________________________________

6) Enlist one reason for opening a savings bank account.

_____________________________________________________________________________

7) Name a benefit of savings bank account over a current account.

_____________________________________________________________________________

8) Name the account opened by those who want to save regularly for a certain period of time.
_____________________________________________________________________________

9) Why is opening of recurring deposit suited for certain type of people?

_____________________________________________________________________________
_____________________________________________________________________________

10) Will closing of a recurring deposit attract any penalty? If so, how much?
_____________________________________________________________________________
_____________________________________________________________________________

11) What is the normal maturity period allowed for a recurring deposit?
____________________________________________________________________________

12) Why is a fixed deposit account so called?

_____________________________________________________________________________

13) Is withdrawal allowed in a fixed deposit account?

_____________________________________________________________________________

14) When does a deposit holder produce a fixed deposit receipt to the bank?
_____________________________________________________________________________

15
 Jumble
Time

Jumbled Words Clue Solution

Account mainly used for large
Centurr Aoutncc number of transactions on a
daily basis.
Account that have a lot of flexibility for
Ssngiva Aoutncc deposits and withdrawal of funds
and also pays a nominal interest.
Account mainly opened for saving
Rringeruc Dsitope small amounts and earning higher
rate of interest
Amount deposited in this account
Fedix Dsitope cannot be withdrawn before
specified period of time

1) ___________should be opened to run a business. Fun Time

a) Current Account b) Recurring Deposit Account
c) Savings Bank Account d) Fixed Deposit

2) _____________ encourages people to save money and deposit

their savings.
a) Current Account b) Recurring Deposit Account
c) Savings Bank Account d) Fixed Deposit

3) ________ is opened by those who wants to save regularly

for a certain period of time.
a) Current Account b) Recurring Deposit Account
c) Savings Bank Account d) Fixed Deposit

4) The account which is opened for a particular fixed period by depositing particular amount is
known as _______________.
a) Recurring Deposit Account b) Fixed Deposit Account
c) Current Account d) Savings Account

5) The rate of interest paid for Fixed Deposit ____________.

a) varies according to period and account b) same in all banks
c) differ from bank to bank d) both (a) and (c)

So, which
bank account
will you open?

16
 Subject: Geography
Class: VII
Term: 2
Banking through
internet... wow...

Banking:
With new
technology

Banking with New technology

The rapid advancement in information and communication

technology such as widespread use of computers, mobiles and
internet has enabled Indian banks to provide more diversified and
convenient services to its customers. A few such technology
enabled services are as follows.

Real Time Gross Settlement

Real Time Gross Settlement (RTGS) system, is a system through
which electronic instructions can be given to transfer funds from
the account of a customer in one bank to the account of a customer
of another bank. It facilitates instant transfer of money from one
account to the other across cities. As the name suggests, funds
transfer between banks takes place on a 'real time' basis.
Therefore, money can reach the beneficiary instantaneously and
the beneficiary's bank has the responsibility to credit the
beneficiary's account within two hours from the time the transaction
is initiated. RTGS is settled on a gross basis which means that
each transaction is settled independently. Complete details such
as the receiver's name, bank account number, account type
(savings or current account), bank name, city, branch name, etc.,
should be furnished to the bank at the time of requesting for such
transfers so that the amount reaches the beneficiaries' account
correctly and faster. This is basically a large value remittance
system where funds can be transferred quickly with the minimum
amount to be transferred through RTGS being 2 lakh rupees. This
facility is useful to banks for their funds management, for
companies to transfer large amounts and for individuals who
require urgent payments.

17
 National Electronic Fund Transfer
National Electronic Funds Transfer or NEFT is a system whereby anyone who wants to
make payment to another person / company etc. can approach his bank and give
instructions / authorisation to transfer funds directly from his account to the bank account
of the receiver / beneficiary. NEFT operates in hourly batches and funds will be transferred
after each settlement cycle. There are twelve settlement cycles during weekdays and six
settlement cycles on Saturday. Amount is credited in beneficiary's account within two
hours. Complete details such as the receiver's name, bank account number, account type
(savings or current account), bank name, city, branch name, etc., should be furnished to the
bank at the time of requesting for such transfers so that the amount reaches the
beneficiaries' account correctly and faster.

There is no minimum or maximum limit for transferring money through NEFT.

Internet Banking
Internet banking is a system that allows individuals to carry out banking activities from
anywhere and at any time via the internet without visiting a bank branch. Through online
banking, individuals can access their account information anytime and perform all kinds of
routine transaction such as money transfers, balance inquiries, bill payments, etc. Anyone
with internet access can avail online banking facilities by registering with his/her bank.
Online banking is also known as internet banking, e-banking, web banking, virtual banking,
etc.

Mobile Banking
Mobile banking refers to the use of a cellular device to perform banking activities such as
monitoring account balances, transferring money, paying bills, etc. Similar to online
banking, a customer needs to register with the bank to avail mobile banking facilities. Until
recently most of the mobile banking facilities were offered via SMS and known as SMS
banking.

Exercise
True or False.
1) A maximum amount of two lakh rupees can be transfered through RTGS. _________

2) There is no minimum or maximum limit for transferring money through NEFT.

_________
3) To avail online banking facilities you have to register with your bank._______________

4) It is easy to pay bills through mobile banking._______________

Answer the following questions

1) What is RTGS and NEFT?
_____________________________________________________________________________

_____________________________________________________________________________

2) What is Internet banking?

_____________________________________________________________________________

3) What is Mobile banking?

_____________________________________________________________________________

4) Enlist the various details which should be furnished to the bank at the time of requesting for
RTGS facility?
_____________________________________________________________________________
_____________________________________________________________________________.
18
 5) What is the minimum amount required to be transferred through RTGS?
_____________________________________________________________________________

6) What is the minimum limit of money required for transferring money through NEFT?
_____________________________________________________________________________

7) What are the other names for Internet banking?

_____________________________________________________________________________

8) Differentiate between NEFT and RTGS.

_____________________________________________________________________________
_____________________________________________________________________________

Match the following

1) RTGS a) Banking activities done through mobile
2) Funds transferred on hourly basis b) Internet banking
3) Mobile Banking c) NEFT
4) Online banking d) Minimum amount to be transferred is 2 lakh

Fill in the blanks

1) In RTGS each transaction is settled on a ______________.
2) There are ____________ settlement cycles during weekdays and ________ settlement
cycles on Saturday in NEFT.
3) Virtual banking is also called _____________.
4) When mobile banking facilities are offered via SMS, it is called _____________.
5) Amount is credited in beneficiary's account within ____________ hours using NEFT
6) The minimum amount to be transferred through RTGS is ______________.
Fun Time
1) Under which system minimum two lakh rupees need to be transferred?
a) RTGS b) NEFT
c) Internet Banking d) Mobile Banking

2) __________ system allows individuals to carry out banking activities through internet.
a) RTGS b) NEFT
c) Internet Banking d) Mobile Banking

3) __________ allows the use of cellular device for performing few banking activicties.
a) RTGS b) NEFT
c) Internet Banking d) Mobile Banking

4) In NEFT how many settlement cycles are there in a weekdays?

a) 2 b) 12
c) 14 d) 11

5) In RTGS funds transfer between banks takes place on

a) Random time basis b) Real time basis
c) Rough time basis d) Real total basis

We have our
bank in our mobiles
and computers

19
 Subject: English
Class: VII
Term: 1
Shopping without cash...
How?

Living within
means

Living within means

11 year old Sneha was a happy little girl who lived with her parents
and Grandma. When Diwali came, her father bought a lot of gifts for
her. Sneha was excited and went to her Grandma's room to show
her gifts. “Look Grandma, Daddy bought me a whole load of Diwali
gifts.”

Her grandma looked up from the magazine she was reading and
said, "That was very kind of him. It must have been expensive.”
"Yes,” Sneha said. “He got me a Barbie doll that costs a lot of
money and he also got me loads of other toys I wanted." She then
paused and asked, "Grandma, Daddy hasn't got any money, has
he?" Her granny put the magazine down and said, "What makes
you say that?”

"Well Daddy said he didn't have the money, so he put it on his card,”
said Sneha. “If you don't have any money, you can just put what you
want to buy on your card, can't you Grandma?" Granny took a deep
breath. "You still need to have money to pay back on the card," she
pointed out but Sneha was already away to play with one of the toys
her Daddy had bought her. Grandma shook her head and got up to
find Sneha's father.

After hearing his mother's concerns, Sneha's father said, "I paid for
the toys with a debit card that takes the money straight from my
account. I did not pay with a credit card, where you pay interest and
the debt can pile up if you let it."

Now Sneha does not understand the difference between debit card
and credit card. The purchases we make using a debit card or the
money we take out from an ATM is our own money that is deposited

20
 in our bank account. On the other hand, any purchases made using a credit card is a loan.
We borrow money from the issuer of the credit card, usually a bank, to buy things with a
promise to pay them later, generally within 30-50 days . But what if we do not have enough
money to repay after that period? The issuer bank will charge interest as well as a fine for our
failure to keep our promise. This will increase our loan amount. Hence, it is important to live
within our means and not borrow money unnecessarily.

Exercise
1) How did Sneha's father pay for the toys he bought for her?
______________________________________________________________________

2) What was Sneha's Grandma concerned about?

______________________________________________________________________

3) What will happen if we fail to pay our credit card dues in time?
______________________________________________________________________

True or False.
1) Even if you don't have money, you still can buy things using your debit card. __________
2) If you purchase things using your debit card, you are not borrowing any money. ________

Jumble
Time

Jumbled Words Clue Solution

beDit arCd Help in purchases without cash
redCti arCd Help in purchases without cash but creates loan

Fun Time
1) Sneha's father paid for the toys with ____________.
a) debit card b) loan
c) credit card d) cash

2) Purchases made using ____________ card is a loan.

a) debit card b) loan
c) credit card d) cash

We should take care

which card we are
using while shopping

21
 Subject: English
Class: VII
Term: 2
Story time!

The poor
man's wealth

Ramchand and Premchand were neighbours. While Ramchand

was a poor farmer, Premchand was a rich land owner.

Ramchand used to be very relaxed and happy. He never bothered

to close the doors and windows of his house at night. Although he
had no money he was peaceful and slept soundly at night.

On the other hand, Premchand used to be very tense always. He

closed the doors and windows of his house at night. He could not
sleep well and was always worried that someone might break open
his safe and steal away his money. He envied his neighbour, the
peaceful Ramchand.

One day, Premchand called Ramchand and gave him a box full of
cash saying, “Look my dear friend. I am blessed with plenty of
wealth. I find you living in poverty. So, take this cash and live in
prosperity.”

Ramchand was overwhelmingly happy. He was joyful throughout

the day. Night fell and Ramchand went to bed as usual. But, that
night, he could not sleep. He went and closed the doors and
windows. He still could not sleep. He kept on looking at the box of
cash. The whole night he was disturbed.

As soon as day broke, Ramchand took the box of cash to

Premchand. He returned the box to Premchand saying, “Dear
friend, I am poor. But, your money took away peace from me.
Please bear with me and take back your money.”

Money cannot give you everything. Learn to be satisfied with what

you have and you will always be happy.

22
 Exercise

1) Why Premchand could not sleep well at night?

______________________________________________________________________

2) What did Premchand give Ramchand? What was the result?

______________________________________________________________________

3) Why did Ramchand return the money to Premchand?

______________________________________________________________________

Fun Time
1) Why was Premchand very tense at night?
a) He had lots of expensive things in his house. b) He had sleeping problem.
c) He was scared of darkness. d) He thought the money may get stolen.

2) Ramchand was not able to sleep the whole night because _____________.
a) he was ill. b) he was worried about the box of cash.
c) it was raining. d) there was a cold breeze.

3) What took peace from Ramchand?

a) Jewellery b) Gold
c) Winds d) Money given by Premchand

Can money give you peace?

keep your money safe...

23
 Subject: Mathematics
Class: VII
Time for shopping...
Term: 1
but be careful.

Go for
shopping

Marked Price: In big shops and departmental stores, every item is

tagged and its price is written on it. This is called the marked price
of that item. In India this is commonly known as the MRP or
Maximum Retail Price. MRP is an upper limit on the price of an item
set by the manufacturer, distributor or a governmental or regulatory
authority. Shops cannot charge customers over the MRP.
Sometimes shops also charge below MRP i.e. they offer discounts,
to draw more customers to their stores. However, in some remote
areas, tourist spots and in situations where a product is difficult to
obtain, consumers are often charged more than the MRP. This is
illegal.

Selling Price: The price you actually pay to the shopkeeper for
purchasing an item is called selling price or SP. This may or may not
be the marked price.

Cost Price: The price it costs to produce an item without making

any profit is called cost price or CP. It is also known as the original
price of any item.

Profit: When selling price is greater than cost price.

Loss: When selling price is less than cost price.

Exercise

1) Rahul bought a pair of shoes on which it was written MRP `500.

However, the shopkeeper took only `450 from him. Calculate
the discounted amount?

24
 2) On Snigdha's birthday, her mother bought a pizza for `300. Assuming cost price of that
pizza is `180, calculate the profit made by the pizza outlet.

3) The selling price and cost price of a pen is `10 and 8 respectively. Raju bought 5 pens.
However, the MRP written on each pen is `12. Calculate the total profit and discount for 5
pens. Also find out the profit and discount for 1 pen.

4) Why do shopkeepers sell products at prices lower than the MRP?

______________________________________________________________________
______________________________________________________________________

Jumble
Time

Jumbled Words Clue Solution

Singell Peirc Price we actually pay to shopkeeper.
Cost to produce any item without
Ctos Peirc
adding any profit.

1) Price tagged or written on a product in shops or Fun Time

departmental store is _____________.
a) market price b) selling price
c) discounted price d) maximum retail price

2) The price we actually pay to shopkeeper for purchasing

an item is _______________.
a) market price b) selling price
c) discounted price d) maximum retail price

3) _______________ is the cost to produce an item without adding any profit.

a) market price b) selling price
c) discounted price d) cost price

4) When selling price is greater than cost price it is known as ____________.

a) loss b) profit
c) margin of safety d) no profit no loss

5) When selling price is less than cost price it is known as ___________.

a) profit b) loss
c) margin of safety d) no profit no loss

We should always check

marked and selling
price before purchasing
any item

25
 Subject: Mathematics
Class: VII
Let us calculate Term: 2
simple interest.

Simple
interest rates

As we all know, it costs to borrow money i.e you have to pay an

interest. Similarly, we also earn interest if we deposit money in a
bank account. Interest is always calculated for a specific period of
time, usually a year. At the end of that period, interest is calculated
and added to the principal i.e. the initial amount of money you
borrowed or deposited. This is called simple interest and the rate
at which it is calculated is called Simple interest rate.

There is a formula to calculate simple interest: SI = Prt/100

Where
SI = Simple Interest
P = Principal
r = Interest rate
t = Time

Case study

Rohan wanted to buy a bike to go on rides with his friends. He had

saved `400 but the bike is being sold at `6400. He went to his father
to borrow the extra money he needed to buy that bike. But his father
had a very different idea. He told Rohan to help him in cleaning up
their garden for which he would pay him `500 every month. In this
way Rohan would be able to buy that bike after a year. His father
also agreed to help Rohan open a bank account so that he could
deposit `500 every month in a bank and earn interest.

Assuming that the bank agreed to pay an annual simple interest

rate of 12 % to Rohan on his deposits, answer the following
questions.

26
 Exercise

1) Calculate how much money Rohan will have in his bank account at the end of the year.
______________________________________________________________________
______________________________________________________________________

2) What will be the total interest amount earned by Rohan?

______________________________________________________________________
______________________________________________________________________

3) Will Rohan have the required amount of money to buy his bike at the end of the year?
______________________________________________________________________
______________________________________________________________________

Jumble
Time

Jumbled Words Clue Solution

isteretn We get on Principal amount
ppalicnir Amount invested
Duration for which principal amount
temi
is invested.

1) Amount on which we get interest is known as _______________.

Fun Time
a) principal b) interest
c) sum of money d) amount

2) ________________ is the amount we get on principal invested.

a) principal b) interest
c) sum of money d) amount

3) Simple Interest we get on principal is for specific ___________ duration.

a) year b) time
c) term d) day

4) The formula to calculate simple interest is ______.

a) SI= PQR/100 b) SI=PQT/100
c) SI=PRT/100 d) SI=QRT/100

I am going to calculate
simple interest using
formula: SI = PRT/100

27
 Time to solve Yeah, we will have fun
crosswords Rashi Saif.

CROSSWORD
1
M
2
L

3
R
4
O
5 6
I F

7
C

8
C

9
B

10
A

C T n r o T d e et h ac ea e r e h s C r o r e n Ct er n. s o s w r o k a M d r e

Across Down
2. A sum of money which is expected to be returned 1. The payment date of a loan
along with some compensation 4. First Governor of RBI
3. A system through which payments between banks 6. A sum of money saved for a particular purpose
are processed and settled individually, on real time
basis
5. It is the additional price paid for borrowing money
7. A type of short term borrowing. It gives the holder
an option to buy things without making an actual cash
payment
8. These accounts are used by businesses and there
is no set limit to the number of transactions in a day
9. Oldest surviving bank in the world
10. An electronic telecommunications device that
allows customers to complete basic banking
transactions

28
 Time for more Gaming and learning
crosswords Munaf. together isn’t it great

T I D

S L

Banking

repaid with

ABBREVIATIONS
Time for
1. ATM abbreviations

2. PIN
3. RTGS
4. NEFT

29
 Scripted by:
Maharaja Sawai Illustrations:
Man Singh Madhav Gupta, Tane
s
Lendin Vidyalaya, Bal Bharti School, Bankin
g Puri sa
g Jaipur Rohini, Delhi

20?
 Activities

1. Suppose you have `1000/- in your pocket and you want to travel to the nearest town
for a day. Take the help of your parents and prepare a list of things required while
travelling. Also, prepare an estimate of the expenses that you will incur during your
visit.

2. Ask all the teachers in your school and parents the following questions as a part of a
survey and calculate the % of people using bank accounts/ Debit card/ Credit Card
atleast twice a month:

a) Do you have a bank account?

Yes No
b) Do you have an ATM/Debit card?
Yes No
c) How often do you use your ATM/Debit card?
Never Daily Weekly Monthly
d) Do you own a credit card?
Yes No
e) How often do you use your credit card?
Never Weekly Monthly
f) How often do you check your bank statement?
Never Weekly Monthly Yearly

3. Make a list of ATM centres available in your locality (within 5 km radius of your place of
residence)?

4. Check any wrapped product of daily consumption (for example: soap, toothpaste,
biscuits, medicines, packed milk, bread etc.) and note down the details available on
the packet?

5. Prepare a poster on any one of the following topics:

a) Importance of Savings
b) Need for Borrowing
c) Shopping

6. Ask 8 person from your neighborhood the following questions and note down the
answers given by them. Also, note the total persons who gave correct answers and
explain the formula to calculate the problems in case of wrong answers being given.
a) Ballu invested Rs.10,000/- in a savings bank account that earned 2% simple interest.
Find the interest earned if the amount was kept in the bank for 4 years.
Steps:
Simple Interest (I) = P (Principal) x R (Interest rate) x T(Time)

b) Hritik deposits Rs.6000 and got back an amount of Rs.6600 after a year. Find the
simple interest he got in percentage.

Steps:
1. Simple Interest (SI) = Amount (A) – Principal (P)
2. SI/Principle x 100
7. Make a list of 5 Banks available in your locality and check if they allow opening of
minor bank account?

8. Ask the following questions to your parents:

a) Is there any difference between monthly spending during festivals and monthly
spending during normal days?
b) Take an example of any one of the festivals and note the additional things
purchased during such occasions.
c) How do you plan your expenses for the festivals?

9. Get a latest bus or train ticket bought by you or your family members and find out the
details mentioned on it.

10. Prepare a 2 minutes speech on any one of the following topics:

a) I am a bank: the benefits I provide
b) Consumer Rights
c) If I go for shopping with Rs. 1000 in my pocket.
Prepared by: