When individuals or firms deposit money in banks for safekeeping, it typically involves opening a bank account. There are various types of bank accounts, and the money deposited can serve different purposes.
When individuals or firms deposit money in a bank, they are essentially entrusting the bank with their funds. In return, the bank may pay interest on the deposited amount and provide services such as online banking, ATM access, and monthly statements.
It's important to note that deposits in banks are often insured up to a certain limit by government-backed programs, such as the Federal Deposit Insurance Corporation (FDIC) in the United States. This insurance provides a level of protection to depositors in case the bank encounters financial difficulties.