Direct Deposit
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Definition of 'Direct Deposit'Electronic funds that are deposited directly into your bank account rather than through a paper check. Common uses of a direct deposit include income tax refunds and pay checks. |
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Investopedia explains 'Direct Deposit'As a whole, direct deposit is the most popular form of payment as it eliminates the risk of losing a check and eliminates the need to physically visit a bank to make a deposit.Direct deposit allows an employee's pay to be immediately available in their accounts at midnight the day before pay day and it is not subject to a check clearing wait period. Salaries paid via check can take a week or more to clear within their account. Direct deposits are also popular for income tax refunds, as it is the fastest method of payment. |
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