A deposit account is a type of bank account where you can safely store your money. These accounts often pay you interest, which is a small amount of money earned over time.

There are two main types of deposit accounts:

• Demand deposits: You can take your money out whenever you want without giving notice (for example, checking or current accounts).
• Time deposits: You agree to keep your money in the account for a fixed period. If you take it out early, there may be restrictions or fees (for example, savings accounts).

Banks take the money from these accounts to provide loans to others. To keep the banking system safe, central banks require that banks keep a certain amount of cash on hand, known as a reserve ratio.