A checking account is a type of bank account that allows individuals and businesses to deposit and withdraw funds for various financial transactions. It is often used for day-to-day banking needs, such as paying bills, making purchases, and accessing cash through ATM withdrawals.
Customers can deposit money into their checking accounts through various methods, such as direct deposit, cash deposits, or electronic transfers. They can access their funds through checks, debit cards, or ATM withdrawals. Most checking accounts come with a supply of checks that account holders can use to make payments to individuals or businesses, though you may need to pay for them.
Many banks offer online and mobile banking services, allowing customers to manage their accounts, view transactions, and make transfers electronically. Additionally, they may offer overdraft protection, which allows customers to make transactions that exceed their account balance, subject to certain fees and terms.
Checking accounts are considered liquid assets, meaning the funds are easily accessible and can be used for everyday expenses. However, they typically do not earn interest compared to savings accounts or other investment options.