Definition of money market deposit account

market-sensitive bank account that has been offered since December 1982. Under Depository Institutions Deregulatory Committee rules, such accounts had a minimum of $1,000 (eliminated in 1986) and only three checks may be drawn per month, although unlimited transfers may be carried out at an automated teller machine. The funds are therefore liquid-that is, they are available to depositors at any time without penalty. The interest rate is generally comparable to rates on money market mutual funds, though any individual bank's rate may be higher or lower. These accounts are insured by the Federal Deposit Insurance Corporation.