A CMMA is like a Money Market Deposit Account (MMDA) offered by a bank, except it is not insured by the FDIC.
Instead, a CMMA is an investment in a corporation, and the corporation provides security for the investment by issuing corporate debt—typically a shelf offering registered with the Securities and Exchange Commission (SEC).
A CMMA has all the attributes of a bank account, yet typically pays a higher interest rate.
CMMAs appeal to people with a strong affinity for the issuing corporation. Brand loyalty, coupled with higher interest rates, motivates customers, distributors, employees, and retirees to invest, providing a stable source of funding for the corporation.
