A bank account is a documentation of the financial transactions between a client and a banking institution. These institutions have offered several types of accounts to provide to the needs of all class of individuals. One of the most significant functions of a bank is accepting deposits that are aimed towards creating savings for the idea of utilizing them in beneficial investments. Those, on the other hand, also choose to deposit their money in the banks, as they can get interest, and as well as to avoid the risk of theft.
Here are the Common Types of Bank Accounts.
A checking account – this account allows a person to deposits, withdraw their savings and transfer funds as much as he or she needs. The check is the main resource, which is applied for using the deposited cash; occasionally, this is used to deposit in Most banks also issue a debit or credit card to clients that will allow exactly 24 hour money access in a person's bank account by an Automatic Teller Machine or known as an ATM. A checking type account is at times referred to as a standard because individuals sign up for this as their regular bank account.
A savings account – this can be measured like a checking account, and a better term to illustrate a savings account is a limited checking account. Having this type of account, clients can normally deposit and withdraw funds as they would with a checking account. However, the number of transactions may be limited. Its primary function is to help the customer to save up money for whatever reason.
A money market account – this is also a well-accepted type of a bank account that pays considerably higher interests rate on the money. However, this is usually requiring a much privileged minimum balance to be kept in the account before an interest can be earned.
A time deposit account – or fixed deposit account, this account requires the clients to deposit a specific amount of funds for a fixed time period. The money deposited cannot be withdrawn prior to the date of maturity. On the other hand, several banks allow a customer to withdraw cash before maturity with a penalty charge. The interest rate is usually higher than other types of bank accounts, and the longer the time period the more the interest paid.
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