UK Accounting Glossary
A checking account is an account at a depository institution against which checks may be written to make payments. For the consumer checking account, payment can also often be made via debit card. The bank, thrift, or credit union that maintains the checking account will generally send an account statement each month. Checking account balances usually pay very little or no interest. In the US, the FDIC insures checking account balances up to $100,000 per individual. Banks are required to meet a reserve requirement for all checking account deposits by depositing money with the Federal Reserve, typically in the form of vault cash. Checking account balances are also counted in the narrow definition of the money supply known as M1.
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This glossary post was last updated: 4th February 2020.