Deposit (finance)

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A deposit is money placed with some other entity. It is a credit for the party who placed it, and it may be taken back (withdrawn), transferred to some other party, or used for a purchase. It is often used with respect to banks, where deposits are usually their main source of funding.

Individuals and corporations need money to pursue their daily business. They place the money on deposit to earn interest, using the money market. Types of deposits are:

  • Transactional account (checking account or current account, by country), the depositor has the right to use the money at any time, sometimes short notice periods are agreed; also called call deposit or sight deposit
  • Term deposit (also time deposit), bear a fixed time and fixed interest rate[1]
  • Overnight lending occurs usually from noon to noon, using a special rate. to give as security or in part payment.

See also[edit]


  1. ^ term deposit, Investopedia, accessed 2012-05-14.