Demand Deposit: Best Demand Deposit Account Rates

A demand deposit is money a depositor deposits into a bank account. The funds can be withdrawn on demand at a depositor’s discretion at any time. This article will explain in detail what demand deposits are, the difference between demand deposit and time deposit, what benefits demand deposits provide, and recommend some demand deposit accounts at the end. Read on to find out more if you are keen to learn more about demand deposits:

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What is a Demand Deposit?

A demand deposit is funds a depositor deposits into a bank account. As its name suggests, the money in a demand deposit account can be withdrawn on demand at a depositor’s discretion at any time for managing everyday spending, paying bills or withdrawing cash without penalty. Demand deposit accounts can be single ownership or joint, depending on your needs. Although it provides depositors with much flexibility, allowing you to use your money whenever needed, the downside of such an account is that the bank or financial institution will only pay either a low or no interest rate on the deposit. Instead, you are more likely to earn interest on a savings account. 

Demand Deposit vs. Term Deposit

ItemDemand Deposit Term Deposit
Purpose Everyday transactions Earning interests
Interest Rate Lower and fixed (or even zero)Higher and predetermined
Ease of accessGreaterLower
Maturity No - funds can be withdrawn at any time without penalty Yes - can only be withdrawn at maturity to avoid penalty

What are the benefits of demand deposit?

High Level of Liquidity

With demand deposit accounts, the funds can be easily accessed and this high level of liquidity is the major reason why many are attracted to set up these accounts. Depositors can withdraw cash from the demand deposit accounts or use the funds in the accounts to pay for something at any time without giving the bank any notice or penalty as long as there are enough funds in the account.

Allows Joint Ownership

Also, demand deposit accounts allow single ownership or joint ownership, depending on your needs or life stages. With joint ownership, account holders can manage finances together.

Best Interest Rates of Demand Deposit Account in HK (As of Oct 2022)

Bank Interest Rates
  • First HK$20,000: 3%
  • HK$20,000+ - HK$300,000: 0.3%
Livi Bank
  • First HK$50,000 or above: 1%
  • HK$50,000+ - HK$500,000: 0.4%
  • Remainder:0.1%
Airstar Bank
  • First HK$20,000: 3.6%
  • HK$20,000+ - HK$300,000: 0.5%
  • HK$300,000 or above:0.1%
Ant Bank
  • First HK$20,000: 1%
  • HK$20,000+ - HK$200,000: 0.5%
  • HK$200,000 or above:0.001%
ZA Bank
  • First HK$300,000:0.31%
  • HK$300,000+:0.01%
Standard Chartered Bank
  • HK$200,000- HK$30M:1.5%
  • HK$200,000 or above:0.8%
China Construction Bank
  • HK$2M - HK$5M:0.4%
  • HK$5,000 - HK$2M:0.1%

Find the best Bank Accounts in HK!


What is a demand deposit?

A demand deposit is money a depositor deposits into a bank account that can be withdrawn on demand at any time.

Are demand deposits safe?

Yes, demand deposits are protected by Hong Kong Bank Deposit Protection Scheme and the protection is statutory.

What is the difference between demand deposit and time deposit?

The main difference between demand deposit accounts and deposit accounts is that demand deposits allow depositors to withdraw money at any time without penalty whereas time deposits do not.