Define: Certificate of Deposit

UK Accounting Glossary

Definition: Certificate of Deposit



Advertisement



Full Definition of Certificate of Deposit


A CD, or Certificate of Deposit, is a savings instrument issued by a bank or thrift. The CD pays interest on deposits held for the term of the CD. The interest rate on a CD is usually quoted as an annual percentage yield, or APY and is determined by competitive market forces. CD yields tend to vary across institutions. Early withdrawal of funds deposited to a CD generally incurs a penalty. Typical periods for a CD are 1 to 6, 9, 12, 18, 24, 30, 36, 48, or 60 months. A CD is sometimes called a time deposit. A jumbo CD is a CD having a minimum denomination of $100,000. Individuals and institutions alike can use the CD as a low-risk way to earn interest income.


Advertisement




Cite Term


To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
https://payrollheaven.com/define/certificate-of-deposit/
Modern Language Association (MLA):
Certificate of Deposit. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. April 02, 2020 https://payrollheaven.com/define/certificate-of-deposit/.
Chicago Manual of Style (CMS):
Certificate of Deposit. PayrollHeaven.com. Payroll & Accounting Heaven Ltd. https://payrollheaven.com/define/certificate-of-deposit/ (accessed: April 02, 2020).
American Psychological Association (APA):
Certificate of Deposit. PayrollHeaven.com. Retrieved April 02, 2020, from PayrollHeaven.com website: https://payrollheaven.com/define/certificate-of-deposit/

Definition Sources


Definitions for Certificate of Deposit are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 4th February 2020.