Written by the Fiveable Content Team • Last updated September 2025
Written by the Fiveable Content Team • Last updated September 2025
Definition
Demand deposits are bank account balances that can be withdrawn at any time without prior notice. They form the basis of the money supply that is immediately accessible for transactions.
Related terms
Checking Account: A type of demand deposit account that allows for frequent withdrawals and deposits, facilitating daily financial transactions.
Money Supply: The total amount of monetary assets available in an economy at a specific time, which includes cash, coins, and demand deposits.
Overdraft Protection: A financial service that covers transactions made when insufficient funds are available in the demand deposit account, preventing bounced checks or declined payments