Answer:
Assuming that your question is about an escrow account held by a person who normally cannot earn interest on a transaction account -- a law firm, for example -- there is an exception for funds held in a fiduciary capacity:
If the funds are all beneficially owned by individuals or other persons who would qualify for NOW account ownership in their own right, the escrow account could be a NOW account and earn interest.
First published on BankersOnline.com 9/20/10
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