Deposit accounts (DDA)
If you plan on offering banking services to your customers, such as savings plans, deposit and withdrawal functionality, or interest on savings, we might recommend that you have DDAs for each of your customers. A DDA is the primary, real deposit/ledger account whose balance represents the total of all transactions on the account or on any related subledgers/subaccounts, and through which all associated transactions ultimately settle. Our DDA products include:
- Checking or Savings: Accounts designed for customers to deposit money into it and take money out of it as needed, with no limit. In the US, deposit accounts are usually described as either checking accounts or savings accounts. Checking accounts are transactional accounts and are used to deposit money, make transfers, write checks, withdraw cash, pay bills, and take care of other day-to-day banking transactions. In most cases, they earn little to no interest. Savings accounts are usually used to set aside money for the future. Customers usually deposit money they do not expect to need or use on a regular basis into this type of savings account. Savings accounts are usually interest-bearing. Cross River savings accounts can also be checking accounts.
- DDAs are usually eligible for FDIC insurance for up to $250,000 in deposits.
- Time deposit (CD) accounts: A type of account customers can use to set aside money for the future. Unlike a savings account, customers cannot withdraw funds from a CD whenever they like. Typically, money must remain in a CD for a certain period of time, If it is withdrawn early, based on the terms and conditions of the product, a penalty may apply and some or all earned interest may be forfeit[DA8] [AL9] . The required period of time could be three months to five years or more[DA10] [AL11] , depending on the terms and conditions of the specific product. In addition, there may be a required minimum deposit. CDs typically offer a higher rate of interest than regular savings accounts.
Cross River recommends that you use deposit accounts if any of the following are true:
- Your customers will have their own Cross River Bank accounts, with their tax IDs on the accounts
- Your customers need monthly bank statements for their account or accounts
- Your customers need annual tax documents about account earnings
Learn about checks in our payment products section.