Why are deposits in bank called demand deposits?
Answers
Some Deposits in a bank are called demand deposits because they can be withdrawn without any prior notice
Answer:
DEFINITION :
A demand deposit account (DDA) consists of funds held in a bank account from which deposited funds can be withdrawn at any time, such as checking accounts. DDA accounts can pay interest on a deposit into the accounts but aren’t required. A DDA allows funds to be accessed anytime, while a term deposit account restricts access for a predetermined time.
HOW DOES IT WORD:
DDA accounts provide the money consumers need to make a purchase. Funds can be accessed at any time. If depositors were required to notify their financial institutions before withdrawing funds, the depositors would have challenges making everyday purchases and paying bills. However, DDA can also mean direct debit authorization, which is a debit from an account for purchasing a good or service.
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