What is a 'Call Deposit Account'

A call deposit account is a bank account for investment funds that offers the advantages of both a savings and a checking account. Like a checking account, a call deposit account has no fixed deposit period, provides instant access to funds and allows unlimited withdrawals and deposits. The call deposit also provides the benefits of a savings account through the accrual of interest.

BREAKING DOWN 'Call Deposit Account'

Call deposit accounts provide the benefits of an interest bearing account without the risk of withdrawal penalties. The rate of interest a call deposit account pays depends on the amount of money in the account, a system commonly referred to as banded interest rates. Depositors may have to meet a minimum balance threshold before they earn any interest, and different currencies may earn at different interest rates.

Call Deposit Account Functions and Features

Along with higher interest rates and a guaranteed level of liquidity, call deposit accounts can be accessed at any time based on the availability of online, mobile or phone banking as well as ATM access. Remote check deposits or direct deposit may be available depending on the precise services offered by the institution.

Most withdrawals from call deposit accounts do not require prior notice unless they are over a certain amount. Based on the amount of funds an institution must maintain as a reserve, advance notice may be required for large cash withdrawals. Additionally, institutions may have daily withdrawal limits designed to lower the risk of losses in the case of identity theft. Transactions above the amount as stipulated by the institution may require advance notice, though this provision applies to traditional checking and savings accounts as well.

Regulation D

Regulation D, a regulation in place at the federal level, provides restrictions on the number of withdrawals that can be made from interest-bearing accounts, such as high interest savings accounts and money market accounts, generally placing the limit at six withdrawals per month. Call deposit accounts are not subjected to these limits, leading to higher levels of liquidity. This does mean that a traditional high yield savings account may offer a higher interest rate at the cost of liquidity.

International Currency Withdrawals

Additionally, call deposit accounts allow investors to deposit and withdraw funds in several currencies, which commonly include the U.S. dollar, the euro and the British pound. This flexibility reduces investors' exposure to foreign exchange expenses and currency risk. Call deposit accounts often have minimum deposit requirements to establish an account and may have minimum daily balance requirements.

RELATED TERMS
  1. Demand Deposit

    Funds held in an account from which deposited funds can be withdrawn ...
  2. Deposit

    1. A transaction involving a transfer of funds to another party ...
  3. Time Deposit

    A savings account or certificate of deposit (CD) held for a fixed-term, ...
  4. Transaction Deposit

    A banking deposit that has immediate and full liquidity, with ...
  5. Deposit In Transit

    A deposit in transit is money that has been received by a company ...
  6. Dual Currency Deposit

    A fixed deposit with variable terms for the currency of payment. ...
Related Articles
  1. Investing

    What is a Demand Deposit?

    A demand deposit is any type of account where the money in the account may be withdrawn at any time without prior notice to the financial institution.
  2. Investing

    Explaining Term Deposits

    A term deposit (more often called a certificate of deposit or CD) is a deposit account that is made for a specific period of time.
  3. Personal Finance

    Handling High-Yield Savings Accounts

    Is this the savings route for you? Read on to find out what these accounts have to offer.
  4. Personal Finance

    Understanding Savings Accounts

    A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate.
  5. Personal Finance

    Get the Best Savings Interest Rates For You

    How do you choose between market deposit accounts, CDs and traditional savings accounts?
  6. Personal Finance

    10 Bank Promotions That Pay You To Open An Account

    Find out which banks are running cash promotions this summer.
  7. Personal Finance

    The 7 Best Places To Put Your Savings

    You work hard to put your money away for the future, but where you should you keep it?
  8. Investing

    Money Market Accounts with the Highest Interest Rates

    Money market savings accounts can offer higher interest rates than regular or even high-yield bank savings accounts – and perks like these.
RELATED FAQS
  1. For what types of accounts are demand deposits available?

    Learn about the different types of accounts designated as demand deposit accounts, such as savings accounts and money market ... Read Answer >>
  2. What is the difference between a demand deposit and a term deposit?

    Understand the meaning of demand deposits and term deposits, and learn about the major differences between these two types ... Read Answer >>
  3. What are the Federal Reserve's guidelines on demand deposit accounts?

    Read about some of the Federal Reserve's requirements and guidelines regarding the treatment, safeguarding and processing ... Read Answer >>
  4. What determines the interest rate in my money market account?

    Placing funds in a money market account may provide a higher interest rate than a savings account due to the underlying securities ... Read Answer >>
  5. Why would you keep funds in a money market account and not a savings account?

    Read about the differences between money market accounts and savings accounts, and see why a depositor would elect a money ... Read Answer >>
Trading Center