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What is the key difference between a transaction account (checking) and a time deposit (savings, CD, etc.)?

User Jony Cruse
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Answer:

A checking account is operated using a cheque book while a time deposit is operated by the use of a pass book

Step-by-step explanation:

Here, we want to examine the difference between a transaction account and a time deposit account.

While both of these are accounts types used in banks, there are some key differences between them.

For a checking account, it is operated using a cheque book to request for funds inside while bearing a very little amount of interest due to the fact that withdrawals can be effected regularly.

For a time deposit account, although it bears a small difference with normal savings account due to the fact that the interest rate is lower. However, the difference here is that a passbook is used in requesting funds from it and it bears a higher interest rate compared to a checking account

User Gentiane
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