Banks and Banking KCBS Channel 2000 - Los Angeles Local News, Weather, and Information. A bank can, through its governing board, enact reasonable rules and regulations for the efficient operation of its business. Deposits A deposit is a sum of money placed in an account to be held by a bank for the depositor. A customer can deposit money by cash or by a check or other document that represents cash.
Deposits are how banks survive.
The deposited money establishes a debtor and creditor relationship between the bank and the depositor. Most often, the bank pays the depositing customer interest for its use of the money until the customer withdraws the funds. The bank has the right to impose rules and regulations managing the deposit, such as restrictions governing the rate of interest the deposited money will earn and guidelines for its withdrawal. A primary function of a bank is to make collections of items such as checks and drafts deposited by customers. The bank acts as an agent for the customer.