A short-term certificate of deposit (CD), usually with a 6-month maturity, where the issuer reissues or extends (rolls over) the certificate of deposit (for a number of years or future periods) with the same depositor (holder) but at a new rate of interest. This structure appeals to issuers since the interest payment period and the final redemption period are not fixed. The depositor buys a set of CDs (as a package) and is at liberty to sell any of the short-term CDs. However, the depositor is committed towards the issuer by redepositing funds to the amount of the next period CD.

Basically, it is a type of informal floating rate certificate of deposit (variable rate certificate of deposit).