is a deposit that represents what the bank pays based on the average balance in one's account

The statement seems to be referring to "interest". Interest is the amount paid by a bank to its depositors for keeping their money. The amount of interest paid depends on the average balance in the depositor's account. Here's a step-by-step explanation:

1. A person deposits money into a bank account.
2. The bank uses this money to fund loans and other investment activities.
3. In return for using the depositor's money, the bank pays them a small amount over time. This is known as interest.
4. The amount of interest paid is usually calculated based on the average balance in the account over a certain period (e.g., monthly or annually).
5. Therefore, the interest can be seen as a deposit that represents what the bank pays based on the average balance in one's account.