• Banking Terms – D



    DDA DDA stands for Demand deposit account. It is the deposit account held at the bank or financial institution for secure and easy access of funds on demand. This deposit account doesn’t earn any interest. It is only for transactional purpose. Demand deposit withdrawal can be made without prior notice to the bank. The most common accounts that come under demand deposit account are savings and checking account. ATM and online transactions are some demand deposit transactions.
    Dealers Dealers do not act as intermediaries; they take positions in securities on their own account.
    Dear Money Dear money is that money which can only be borrowed at a high rate of interest. In dear money policy, bank rate and other rates of interest are high and as a result borrowing becomes expensive.
    Death Duty It is a direct tax which is imposed on the estate of deceased person. Death duty or Death Tax is a form of personal tax on property which is levied when property passes from one person to other at the time of death of the former.
    Debenture Debenture is a fixed-interest long-term debt instrument used by governments and large companies to obtain funds. It is similar to a bond except the securitization conditions are different. A debenture is usually unsecured in the sense that there are no liens or pledges on specific assets. It is however, secured by all properties not otherwise pledged. Debentures are generally freely transferable by the debenture holder.
    Debit In accounting, an entry on the left-hand side of an account recording where amounts are recorded in a double entry system of bookkeeping. Debit is a banking term that indicates the amount of money that is owed by a borrower. It also indicates the amount that is payable, or the amount that has been deducted from an account.
    Debit Bureau Debit Bureau is a data warehouse with decision support capabilities to help financial service companies and retailers make better debit decisions–like opening checking accounts, setting ATM withdrawal limits, accepting checks, and issuing debit cards.
    Debit card It’s a plastic card used for dispensing money, inserting this in the ATM machine; the machine dispenses the required amount if the particular account has the amount.
    Debt An amount owed to a person or organization for funds borrowed. Debt can be represented by a loan note, bond, mortgage or other form stating repayment terms and, if applicable, interest requirements. These different forms all imply intent to pay back an amount owed by a specific date, which is set forth in the repayment terms. It is also known as a liability.
    Debt Burden Debt burden is the total borrowing of an individual from all sources.
    Debt Consolidation Loan A debt consolidation loan is a type of loan, where the bank or the lending institution provides the borrower with a loan that helps the borrower to pay off all his previous debts.
    Debt Recovery Debt recovery is the process that is initiated by the banks and lending institutions, by various procedures like debt settlement or selling of collaterals.
    Debt Repayment Debt repayment is the total process repayment of a debt along with the interest.
    Debt Settlement Debt settlement is a procedure wherein a person in debt negotiates the price with the lender of a loan  to settle the entire debt.
    Deed It is a legal document conveying title to a property. The deed is also used to convey the property from the seller to the buyer.
    Default Risk The possibility that a bond issuer/loan borrower will default i.e., fail to repay principal and interest in a timely manner.
    Deferred Fees Deferred Fees are the cost which will use in Future. E.g. If a customer paid 6000 Rupees, they will account 1000 for a month. So it will be used for 6 months.
    Deflation Deflation is the reverse case of inflation. Deflation denotes continuously falling prices due to higher supply compared to lower demand. In this scenario, the general price level falls and the value of money rises.
    Delinquency If a loan remains outstanding on a due date it is referred to as delinquency.
    Delinquency Loan A loan in which No payment had made for Past 30 to 60 Days.
    Demand deposit A deposit from which withdrawal can be done without notice.
    Deposit The placement of funds into an account at an institution in order to increase the credit balance of the account is known as Deposit. It is the sum of money given to assure the future purchase of something. It can be refer as the liability owed by the bank to its depositor
    Deposit Slip A deposit slip is filled by the depositor while depositing money in the bank. Deposit slip contains depositor’s name, account number, amount and date. These deposit slips are used to keep track of the money that is deposited to the bank on the day. It has two parts. One part acts as customer transaction receipt and the other has cash denomination details which act as audit trail for the bank.
    Depositor The individual or a company who puts the amount in a bank account.
    Dept Capital Debt capital comes from non-owners or outsiders. It is like a loan given to the company by outsiders.
    Derivative Call (Put) Warrants Warrants issued by a third party which grant the holder the right to buy (sell) the shares of a listed company at a specified price.
    Derivative Instrument  Financial instrument whose value depends on the value of another asset.
    Direct Deposit A direct deposit is a deposit in which funds are directly credited to the employee’s individual bank account.  Without customer visiting the bank the funds is credited to his account. Paychecks, online transfer etc are some forms of direct deposit. There are many advantages of using direct deposits. They are processed faster than paper checks and allow quicker access to money. Payment reaches the account the day the check is issued. It avoids bouncing of checks. Unlike paper checks there is no fee or charge collected for direct deposits.
    Direct Lender A direct lender refers to a lender that funds his/her own loans. A direct lender can be one of the biggest financial institutions or a small independent finance company.
    Direct Lending When a borrower is disbursed loan directly by the bank, it is called direct lending.
    Direct Public Offering Wherein the securities of the company are directly offered to the investors instead of using an Underwriter. These are relatively less expensive than the public offering done by using an underwriter which is the traditional way of public offering. The underwriter usually charges the issuing company for selling its stocks to the public.
    Discharged Debts Under the protection of the “Bankruptcy Court” debtors may be released from or discharged from their debts, perhaps by paying a portion of each debt. These debts are known as discharged debts.
    Discount Bond  A bond selling below par to the bondholders due to lower yield rate than the market interest rate.
    Discount Points Discount points are fees paid to a lender at closing in order to lower your mortgage interest rate. While buying points is sometimes a good decision, many times the purchase costs you more than it saves. One point is equal to 1 percent of the loan amount.
    Discount Rate Interest rate, at which an eligible depository institution may borrow funds, typically for a short period, directly from a Federal Reserve Bank is known as Discount Rate. The discount rate is a financial concept based on the future cash flow in lieu of the present value of the cash flow.
    Dishonour of Cheque Non-payment of a cheque by the paying banker with a return memo giving reasons for the non-payment.
    Disposable Income This refers to excess income over regular expenditure available in the hands of an individual.
    Diversification The process of increasing investment instruments in a portfolio in order to diversify risk.
    Dividend Dividends are payments made by a company to its shareholders. When a company earns a profit, that money can be put to two uses: it can either be re-invested in the business (called retained earnings), or it can be paid to the shareholders of the company as a dividend.
    Documentation The process of documentation leads to the lender obtaining various declarations from the borrower and the guarantor(s).
    Down Payment A lump sum cash payment paid by a buyer when he or she purchases a major piece of property, such as a car or house is called down payment. The buyer typically takes out a loan for the balance remaining, and pays it off in monthly installments over time.
    Draft One means of paying the amount drawn by a person on a bank or another person.
    Drawee It is the financial institution expected to pay the check presented for payment.
    Drawer The customer who gives instructions to the drawee for making payment to the other person.
    Due Diligence An internal audit of a target firm by an acquiring firm. Offers are often made contingent upon resolution of the due diligence process.
    DUNS Number DUNS Stands for Data Universal Numbering System. It’s a 9 digit number which used to identify the business all over the world. It was created by Dun & Bradstreet.


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