Early Withdrawal Penalty

Definition

• A depositor forfeits interest or is assessed a service charge for withdrawing funds from or closing out a time deposit before its maturity date.

Synonyms
service fee, withdrawal penalty, premature takeout

Related Terms and Acronyms

• Maturity — Definition,
  • The date when the principal balance of a loan is due and payable to the lender. Also, the date when a bond pays off its principal.
• Service Charge (SC) — Acronym,
  • Fees charged to customers for specific services or as a penalty for not meeting certain requirements such as insufficient funds in a chequing account.
  ➥ Bank account transaction code.
• Time Deposit — Definition,
  • A type of deposit account with a stated maturity at which time the account reverts to another type of account or is "rolled over" for another fixed period of time.
• Withdrawal (WD) — Acronym,
  • Taking money out of a bank account or financial instrument.
  ➥ Bank account transaction code.