when two banks make an arrangement for an interbank deposit the holding bank sets up a due to account for the corresponding bank the institution that makes the deposit the due to account is a holding account also known as a payable account 
banks use a special interest rate on deposits and short term loans this rate is known as the interbank rate the interbank rate depends on maturity market conditions and the credit ratings of the institutions involved these rates are the lowest that can be found at any particular time and are reserved for big banking institutions 