NOW ACCOUNT Meaning and
Definition
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A NOW account, also known as negotiable order of withdrawal account, refers to a type of interest-earning deposit account offered by financial institutions such as banks and credit unions. It is a hybrid account that combines features of a checking account and a savings account.
A NOW account enables account holders to write checks against the funds held in the account while also allowing for limited check-writing privileges. Unlike a regular checking account, NOW accounts typically pay interest on the balance maintained in the account. This interest rate is usually higher than what is offered on a standard checking account but lower than what is obtained from a regular savings account.
Additionally, NOW accounts often have minimum balance requirements which must be maintained by the account holder. If the balance falls below the specified minimum, the financial institution may charge fees or convert the account into a regular checking account which does not earn interest.
NOW accounts gained popularity in the 1970s as a result of regulatory changes that allowed banks to offer interest on checking account balances. These accounts were designed to provide customers with the convenience of a checking account while also offering a moderate return on their deposits. Today, NOW accounts continue to be utilized by individuals and businesses looking for a flexible transactional account that accrues interest.
Common Misspellings for NOW ACCOUNT
- bow account
- mow account
- jow account
- how account
- niw account
- nkw account
- nlw account
- npw account
- n0w account
- n9w account
- noq account
- noa account
- nos account
- noe account
- no3 account
- no2 account
- now zccount
- now sccount
- now wccount
- now qccount
Etymology of NOW ACCOUNT
The etymology of the word "NOW account" is derived from an acronym for "Negotiable Order of Withdrawal". This term was introduced by the Federal Reserve in the United States in the 1970s to refer to a type of interest-bearing checking account that allows account holders to access their funds immediately. The term "NOW account" became commonly used to describe this specific type of account and has since been widely adopted in the banking industry.
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