YOU ASK:
What is the definition of Demand Deposit?
WE ANSWER:
A Demand Deposit refers to funds in bank accounts that the depositor can make and withdraw at his discretion. The most common examples of this would be savings or checking accounts, where depositors can issue checks or make withdrawals even right after a deposit is posted. Demand deposits are among the most popular savings vehicles and make up a considerable portion of the money supply of a country.
The depositor can withdraw by check as long as there are sufficient funds in his account. There is no need to make previous arrangements or preparation with the bank or institution.
The Demand Deposit can be contrasted with a term deposit, where access to the funds is restricted.
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