why are the deposits in the bank called demand deposits? what are their advantages
Answers
Answer:
People deposit their savings in banks. They can withdraw their money whenever required. Because the deposits in the bank account can be withdrawn on demand, these deposits are called demand deposits. Benefits of deposits with banks are as listed below:
Apart from money being safely kept in the banks, people are also paid interest on the amount of money deposited in their bank account.
Deposits also act as direct money in case of cheque payments. Cheques against a deposit settle payments without the use of direct cash.
Explanation:
Answer:
People maintain cash as deposits with banks. In a factor of time, human beings want only a few currencies for their day-to-day needs. They deposit their cash with banks. Banks be given the deposits and additionally pay a quantity as interest on the deposits.
Benefits:
- People have the supply to withdraw the cash as and after they require it. Since the deposits withinside the financial institution bills may be withdrawn on call. Therefore, those deposits are referred to as calls for deposits.
- People’s cash is secure with the banks.
- It earns a sure quantity as interest.
- There is the supply to withdraw the cash as and whilst depositors require.
- There is a smooth provision to take mortgages from the banks to the depositors.
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