What is a Demand Deposit Account and how does it work? If you have all of these questions emerging in your head, then this article is for you. This article is aimed at discussing what a demand deposit account is all about, how it works, and how to create one.
A demand deposit account is also known as a transaction account. It is a type of account that allows you to withdraw or remove all of your money from that account without notification. In other words, you do not have to tell anyone before you can withdraw your funds from your Demand Deposit account.
Furthermore, the money that is put in this type of account can be withdrawn by the owner at any time they wish. Creating a Demand Deposit Account is very easy. You can access your account anytime and anywhere you are. You can also transfer and withdraw funds through the nearest ATM branch or its mobile application.
How Does it Work?
Understanding how a Demand Deposit Account work is very easy. If you are curious, then this section can clear your curiosity. So, if you have a type of account that you need to inform or tell the authorities before you can access your fund, with a Demand Deposit Account you don’t.
That is What a Demand Deposit Account is all about. Therefore, you do not need to tell anyone before you withdraw from your account. Moreover, you can pay bills and cover any expenses when they arise with your money in that account.
All you need to do is to visit the nearest ATM branch close to you with your debit card to make a withdrawal. Or you can access your account via your mobile phone online.
Features of a Demand Deposit Account
The Demand Deposit Account comes with a lot of outstanding features which allow banking fun. You also get to enjoy all of these features and benefits when you create an account. Some of the features of this type of account include:
- You do not need to be eligible to be able to create an account.
- Access the account anytime.
- Unlimited ATM and branch permission.
- There are no limits to the amount of money you can withdraw.
- You do not have to wait for the money in the account to mature before you can access it.
You can also enjoy unlimited transfers from and to the account. Create one today and start accessing funds from wherever you are.
Types of Demand Deposit Accounts
There are three major types of Demand Deposit accounts. Furthermore, these accounts allow you to access all of the services that they render. The three types of accounts include:
- Money Market Accounts
- Checking Accounts.
- Savings Account
Money Market Accounts
This type of account is referred to as a combination of checking and a savings account. With this account, you have the privilege of getting a debit card as well as a check at your disposal. In addition, a money market account offers you higher interest than that of a checking account.
The disadvantage of using this account is that you cannot withdraw more than six times a month. Except for transactions made in person, at ATM centers, or through the mail. Finally, your issuer might require you to have a greater balance to open this type of account.
One of the most popular demand deposit accounts is a checking account. With this type of account, you can get a debit card and a checkbook, which can be used to pay bills on time, shop for items, and more. It is one of the most accessible accounts with loads of benefits and features.
And there are several types of checking accounts to select from. These include online, student, senior, reward, and interest-bearing accounts. The drawback of this account is that you get a low-interest rate. And most checking accounts don’t even come with interest.
The last demand deposit account on our list today is savings accounts. This is another popular and well-known account. Having a savings account provides you with more interest compared to a checking account. But, there are limits to this account.
You are not permitted to transfer or withdraw more than six times a month. But there are exceptions for in-person, mail, and ATM withdrawal. Failure to adhere to these restrictions will result in charges from your bank. Note; there is no ATM for this type but you can access your account online.
Why Should I Create One?
Creating a Demand Deposit Account is a very good idea. Moreover, with your account, you can withdraw your money anytime you need it. You also do not have to tell anyone before you can collect the money in your account.
Saving in the account is also possible. In other words, you can send or transfer a particular amount of money every day. You can also keep them in this account and when something unexpected arises, you can be sure that you can access this money anytime.
How To Open Demand Deposit Account
Many banking organizations offer Demand Deposit Accounts to existing customers. So, you can apply to open one even though you have an account with them. So, if you want to open a Demand Deposit Account with a bank, then follow these steps:
- Select the bank of your choice.
- Check and see if you meet their requirements.
- Provide your personal information.
And before you can create an account, you will need to make the first deposit. So, do so and then create an account. You can finally access money from your account without informing anyone.
In conclusion, Now that you understand What A Demand Deposit Account Is, you can create one in any bank of your preference and start using money wisely without the permission of anyone.