Definition Of

Demand deposit

Demand deposit is bank deposit that can be withdrawn or transferred at any time without notice, in contradistinction to a time deposit where (theoretically) the bank may require a waiting period before the deposit can be withdrawn. Demand deposits may or may not earn interest. A “time deposit” is the opposite of a demand deposit.

Demand deposit is the checking account services that permit depositors to write drafts in payment for goods and services which the bank involved must honor immediately upon presentation.