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, 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 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. Bank Deposits

    Bank deposits are money placed into a deposit accounts at a banking ...
  2. Deposit Interest Rate

    The deposit interest rate is the interest rate paid to deposit ...
  3. Deposit

    1. A transaction involving a transfer of funds to another party ...
  4. Reservable Deposit

    A reservable deposit is a deposit subject to reserve requirements, ...
  5. Core Deposits

    Core deposits are the deposits that form a stable source of funds ...
  6. Negotiable Order of Withdrawal ...

    A negotiable order of withdrawal (NOW) account is an interest-earning ...
Related Articles
  1. IPF - Banking

    Get the Best Savings Interest Rates For You

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

    10 Bank Promotions That Pay You To Open An Account

    Find out which banks are running cash promotions this summer.
  3. 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.
  4. Small Business

    Best Checking Accounts For Small Businesses

    What you need to know to choose the best checking account for your small business – and where to look.
  5. IPF - Banking

    The 5 Best Alternatives to Bank Saving Accounts

    Find out about some of the most profitable available alternatives to depositing money in a traditional bank passbook savings account.
  6. Personal Finance

    Best Checking Accounts For Couples

    Being a couple, especially if you both have jobs, can help you qualify for benefits and fee waivers that would be tougher to get on just one salary.
  7. IPF - Banking

    Protect Your Savings From Their Greatest Threat - You

    Watch your savings magically grow as you make withdrawals a headache and deposits a breeze.
RELATED FAQS
  1. The Difference Between Term Deposit and Demand Deposit

    Understand the meaning of demand deposits and term deposits, and learn about the major differences between the two. Read Answer >>
  2. How liquid are money market accounts?

    Understand the characteristics that distinguish money market accounts from checking, savings account and money market funds ... Read Answer >>
  3. How long does it take a check to clear?

    It usually takes two days for a check to clear, but in some cases it may take longer. Discover how banks treat large deposits ... Read Answer >>
  4. How must banks use the deposit multiplier when calculating their reserves?

    Explore the relationship between the deposit multiplier and the reserve requirement, and learn how this limits the extent ... Read Answer >>
Trading Center