Demand Deposits

Posted in Finance, Accounting and Economics Terms, Total Reads: 1028
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Definition: Demand Deposits

It is the type of account which a bank maintains where the deposits can be withdrawn at any time.

It is of 2 types: -

  • Savings Bank A/c.
  • Current A/c

The customer earns interest on deposits in the savings bank account. The minimum current interest rate on savings bank a/c is 4%. But the depositor has to maintain minimum balance (say Rs. 1000). There a few restrictions on the amount and number of withdrawals as well.

In the Current A/c there are no restrictions in the amount and number of withdrawals. But the depositor does not earn any interest on deposits.

 

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