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Deposit: The action of depositing base money into a deposit account
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This page is to help disambiguate the three different meanings of the word deposit used in banking. For example, the customer arrives with * a deposit of cash, * deposits this central bank money into the bank, and receives a promise from the bank to return the money called * a deposit, which is a credit money called commercial bank money. Each useage of the word deposit means something different to the other meanings. The action of depositing involves a money conversion for the customer who arrives with central bank money and leaves with a different asset called commercial bank money, which for demand deposits is a useable, debt money or credit money. The depositor lends money to the bank and the bank borrows from the depositor. |
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