Definition of Bank Deposits and its Types

Money placed into a banking institution for safekeeping. Bank deposits are made to deposit accounts at a banking institution, such as savings accounts, checking accounts and money market accounts. The account holder has the right to withdraw any deposited funds, as set forth in the terms and conditions of the account. The “deposit” itself is a liability owed by the bank to the depositor (the person or entity that made the deposit), and refers to this liability rather than to the actual funds that are deposited.

Deposit account A deposit account is a current account, savings account, or other type of bank account, at a banking institution that allows money to be deposited and withdrawn by the account holder. These transactions are recorded on the bank’s books, and the resulting balance is recorded as a liability for the bank, and represent the amount owed by the bank to the customer. Some banks charge a fee for this service, while others may pay the customer interest on the funds deposited. Major types

• Checking accounts: A deposit account held at a bank or other financial institution, for the purpose of securely and quickly providing frequent access to funds on demand, through a variety of different channels. Because money is available on demand these accounts are also referred to as demand accounts or demand deposit accounts. • Money market account: A deposit account with a relatively high rate of interest, and short notice (or no notice) required for withdrawals. In the United States, it is a style of instant access deposit subject to federal savings account regulations, such as a monthly transaction limit.

• Savings accounts: Accounts maintained by retail banks that pay interest but can not be used directly as money (for example, by writing a cheque). Although not as convenient to use as checking accounts, these accounts let customers keep liquid assets while still earning a monetary return. • Time deposit: A money deposit at a banking institution that cannot be withdrawn for a preset fixed ‘term’ or period of time. When the term is over it can be withdrawn or it can be rolled over for another term.

Generally speaking, the longer the term the better the yield on the money. • Call deposit: A deposit account which allows to withdraw the money without penalty, mostly without notification to the bank. Often it bears favorable interest rate, but also a minimum balance to take advantage of the benefits 1. Transactional account A transactional account is a deposit account held at a bank or other financial institution, for the purpose of securely and quickly providing frequent access to funds on demand, through a variety of different channels.

Transactional accounts are meant neither for the purpose of earning interest nor for the purpose of savings, but for convenience of the business or personal client; hence they tend not to bear interest. Instead, a customer can deposit or withdraw any amount of money any number of times, subject to availability of funds. Name A transactional account is known as a checking (or chequing account) in North America,[1] and as a current account or cheque account in the United Kingdom, Hong Kong, India and some other countries.

Because money is available on demand it is also sometimes known as a demand account or demand deposit account (DDA), except in the case of NOW accounts in the U. S. , which are technically distinct. History In Holland in the early 1500s, Amsterdam was a major trading and shipping city. People who had acquired large accumulations of cash began to deposit their money with “cashiers” in order to protect their wealth. These cashiers held the money for a fee. Competition drove cashiers to offer additional services, including paying out money to any person bearing a written order from a depositor to do so.

They kept the note as proof of payment. This idea spread to other countries including England and the English colonies in North America, where land owners in Boston in 1681 mortgaged their land to cashiers who provided an account against which they could write checks. In the eighteenth century in England, preprinted checks, serial numbers, and the very word “cheque” appeared. By the late eighteenth century, the difficulty of clearing checks (sending them from one bank to another for collection) gave rise to the development of clearing houses. Features and access

All transactional accounts offer itemized lists of all financial transactions, either through a bank statement or a passbook. A transactional account allows the account holder to make or receive payments by: ? ATM cards (withdraw cash at any Automated Teller Machine) ? debit card (cashless direct payment at a store or merchant) ? cash money (coins and banknotes) ? cheque and money order (paper instruction to pay) ? direct debit (pre-authorized debit) ? Electronic funds transfers (transfer funds electronically to another account) ? giro (funds transfer, direct deposit)

? standing order (automatic funds transfer) ? SWIFT: International account to account transfer. ? Online banking (transfer funds directly to another person via internet banking facility) ATM card n ATM card (also known as a bank card, client card, key card, or cash card) is a card issued by a financial institution, such as a bank,credit union, or building society, that can be used in an Automated Teller Machine (ATM) for transactions such as: deposits, withdrawals, obtaining account information, and other types of transactions, often through interbank networks.

It can also be used on improvised ATMs, such as merchants’ card terminals that deliver ATM features without any cash drawer (commonly referred to as mini ATMs). [1][2] These terminals can also be used as Cashless scrip ATMs by cashing the fund transfer receipt at the merchant’sCashier. [3] | | dimensions of an ATM card The size of ATM cards is 85. 60 ? 53. 98 mm (3. 370 ? 2. 125 in) and rounded corners with a radius of 2. 88–3. 48 mm. , in accordance with ISO/IEC 7810 ID-1 , the same size as other payment cards, such as credit, debit and other cards.

[Non ATM uses of an ATM card Some ATM cards can also be used: ? at a branch, as identification for in-person transactions ? for EFTPOS (Point of Sale / POS) purchases Unlike an offline debit card that is signature based, in-store EFTPOS purchases or refunds with an ATM card require authentication through a personal identification number (PIN), similar to an online debit card that is also PIN based. This means that ATM cards cannot be used at merchants that are without a direct connection to an interbank network.

For other types of transactions through telephone or online banking, this may be performed with an ATM card without in-person authentication. This includes account balance inquiries, electronic bill payments, or in some cases, online purchases (see Interac Online). ATM card networks In some banking networks, the two functions of ATM cards and debit cards are combined into a single card called simply as a debit card or also commonly called as bank card. These are able to perform banking tasks at ATMs and also make point-of-sale transactions, with both features using a PIN.

Canada’s Interac and Europe’s Maestro are examples of networks that link bank accounts with point-of-sale equipment. Some debit card networks also started their lives as ATM card networks before evolving into full fledged debit card networks, example of these networks are: Development Bank of Singapore (DBS)’s Network for Electronic Transfers (NETS) and Bank Central Asia (BCA)’s Debit BCA, both of them were later on adopted by other banks (with Prima Debit being the Prima interbank network version of Debit BCA). ATM cards misuse

Due to increased illegal copies of cards with a magnetic stripe, the European Payments Council established a Card Fraud Prevention Task Force in 2003 that spawned a commitment to migrate all ATMs and POS applications to use a chip-and-PIN solution until the end of 2010. [4] The “SEPA for Cards”[5] has completely removed the magnetic stripe requirement from the former Maestro debit cards, and the savings banks have announced that they will ship their debit cards without a magnetic stripe beginning in 2012,[6] making them unuseable in any ATM or merchant that is only capable of reading a magnetic stripe card.

Debit card | A debit card (also known as a bank card or check card) is a plastic card that provides the cardholder electronic access to his or her bank account(s) at a financial institution. Some cards have a stored value with which a payment is made, while most relay a message to the cardholder’s bank to withdraw funds from a designated account in favor of the payee’s designated bank account. The card can be used as an alternative payment method to cash when making purchases.

In some cases, the primary account number is assigned exclusively for use on the Internet and there is no physical card. [1][2] In many countries, the use of debit cards has become so widespread that their volume has overtaken or entirely replaced cheques and, in some instances, cash transactions. The development of debit cards, unlike credit cards and charge cards, has generally been country specific resulting in a number of different systems around the world, which were often incompatible.

Since the mid 2000s, a number of initiatives have allowed debit cards issued in one country to be used in other countries and allowed their use for internet and phone purchases. Unlike credit and charge cards, payments using a debit card are immediately transferred from the cardholder’s designated bank account, instead of them paying the money back at a later date. Debit cards usually also allow for instant withdrawal of cash, acting as the ATM card for withdrawing cash.

Merchants may also offer cashbackfacilities to customers, where a customer can withdraw cash along with their purchase. Types of debit card systems 1. EMV chip 2. Hologram 3. Card number 4. Card brand logo 5. Expiration date 6. Cardholder’s name [pic] An example of the reverse side of a typical debit card: 1. Magnetic stripe 2. Signature strip 3. Card Security Code There are currently three ways that debit card transactions are processed: EFTPOS (also known as online debit or PIN debit), offline debit (also known as signature debit) and the Electronic Purse Card System.

[3] One physical card can include the functions of all three types, so that it can be used in a number of different circumstances. Although many debit cards are of the Visa or MasterCard brand, there are many other types of debit card, each accepted only within a particular country or region, for example Switch (now: Maestro) and Solo in the United Kingdom, Interac in Canada, Carte Bleue in France, Laser in Ireland, EC electronic cash (formerly Eurocheque) in Germany, UnionPay in China and EFTPOS cards in Australia and New Zealand.

The need for cross-border compatibility and the advent of the euro recently led to many of these card networks (such as Switzerland’s “EC direkt”, Austria’s “Bankomatkasse” and Switch in the United Kingdom) being re-branded with the internationally recognised Maestro logo, which is part of the MasterCard brand.

Some debit cards are dual branded with the logo of the (former) national card as well as Maestro (for example, EC cards in Germany, Laser cards in Ireland, Switch and Solo in the UK, Pinpas cards in the Netherlands, Bancontact cards in Belgium, etc. ). The use of a debit card system allows operators to package their product more effectively while monitoring customer spending. An example of one of these systems is ECS byEmbed International.