Posted in Finance, Accounting and Economics Terms, Total Reads: 438
When a person requests and obtains a return on deposits made to the retirement, he is required to reinvest a certain amount into his/her fund to receive the specific payout from the fund on retirement. This reinvesting fund is known as redeposit.
The cash management policy in which the central bank transfers the funds to chartered banks is also called redeposit. When the funds are transferred to chartered banks, there is an infusion of cash into the system. This prevents the interest rates from rising too high.
If an employee can request funds from the deposits made to the retirement funds, he will have to redeposit the certain amount back to the retirement fund to maintain the fund they are due to receive and to maintain the time when they can retire.