Coins:
These are metallic token money because the intrinsic (metallic) value of a coin is less than its face value.
Currency notes:
These are made of paper without any intrinsic value. These are inconvertible in the sense that the issuing authority (RBI) does not stand ready to buy them back against gold or silver or full-bodied gold or silver coins of equal value at a predetermined price.
Deposit money:
It is not like coins or currency notes that can be passed on from hand to hand for a transfer of purchasing power. Deposits are only entries in the ledgers of bank to the credit of their holders. Only demand deposits of banks on which cheques can be drawn are treated as money. The cheques are an instrument through which these deposits can be transferred from the payer to the payee. Only when the ownership of these deposits has been so transferred is the medium of exchange or the means of payment function of these deposits completed.
