A NOW account and an interest-earning checking account are very similar to each other. NOW stands for negotiable order of withdrawal and NOW accounts are offered at many banks, mutual savings banks and savings and loan companies.
NOW accounts are offered at many financial institutions. They are accounts which bear interest to the account holder. They are said to be like a savings account in a sense; however checks can be written against the money in the account.
Interest Checking Account
Interest-earning checking accounts are hard to find. Most checking accounts do not pay interest on deposited money; however, some banks still offer checking accounts that do pay interest.
NOW Account Interest and Fees
NOW account holders earn a low rate of interest on their deposits. Typically NOW accounts do not require a minimum balance at all times; however, most NOW accounts do charge a monthly service fee.
Interest Checking Interest and Fees
Interest earning checking accounts typically have a lot of restrictions on them. The main restriction is that these accounts require a minimum balance at all times. If the amount drops below the requirement, a fee is charged. These accounts almost always charge a monthly service charge and pay a low rate of interest on deposits.
- Consumer Financial Protection Bureau. "What Is the Difference Between a Checking Account, a Demand Deposit Account, and a Now (Negotiable Order of Withdrawal) Account?" Accessed Oct. 3, 2020.
- Federal Deposit Insurance Corporation. "What's Covered." Accessed Oct. 3, 2020.
- Federal Deposit Insurance Corporation. "High-Yield Checking Accounts: Know the Rules." Accessed Oct. 3, 2020.
Jennifer VanBaren started her professional online writing career in 2010. She taught college-level accounting, math and business classes for five years. Her writing highlights include publishing articles about music, business, gardening and home organization. She holds a Bachelor of Science in accounting and finance from St. Joseph's College in Rensselaer, Ind.