DEMAND DEPOSITS

Demand deposits. A transactional deposit account held at a financial institution that allows for withdrawals and deposits. Money held in a checking account is very liquid, and can be withdrawn using checks (checking accounts), automated cash machines and electronic debits, among other methods. A checking account differs from other bank accounts in that it often allows for numerous withdrawals and unlimited deposits, whereas savings accounts sometimes limit both. Checking accounts can include business accounts, student accounts and joint accounts along with many other types of accounts which offer similar features. In exchange for the liquidity, checking accounts typically do not offer a high interest rate. A checking account may also be called a "demand account" or "transactional account" [see].

Pricing I. Most banks charge a monthly maintenance fee; if funds stay above a certain level (on average during one month), the fee is not charged. See this excellent HSBC product description (retail) [see]. No fees for domestic ATM; fees are charged at global ATMs.

Pricing II. There is a price to pay for overdraft protection! SunTrust [see]: "It’s not uncommon to occasionally get caught short of funds in your checking, savings, or money market account. When that happens, it’s helpful to have a backup plan to avoid bouncing a check or getting stranded at the ATM. Overdraft Protection: Sign up for this service and we’ll link your checking, savings, or money market account to your other SunTrust accounts and transfer the necessary funds to cover any shortfalls. As long as you have sufficient funds in your linked accounts, you’ll pay only a single $12.50 transfer fee on the day the overdraft occurs. For those who do not sign up, $36 are charged for each overdrawn item; otherwise, a $7 monthly fee is charged for the automatic transfer of funds between accounts, so that overdrafts are avoided.

Balance sheet. Liabilities. Depositary sources of funds (non-depositary sources: bonds, borrowing from other banks, discount borrowing from the central bank).

Type of banking. Retail / Corporate.

Size of the market. Retail deposits at US Commercial Banks, March 7 2012: $ 1,872.3 billion.

Case. Citibank Mobile Check Deposit [see].
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