Banking Related Terms Full Form

Banking is a financial process that allows banks to accept deposits from the public and lend money on loans with basic interests when needed by the public. These activities can be directly performed by the bank or indirectly by capital markets. Nowadays banking has become an important part of everyone’s life.

This Story also Contains

1. Terms Is Used In Banking
2. Types of Banks For Banking
3. Basic Banking Services Provided By The Banks
4. What Is E banking?
5. Different Designations In Banks

Terms Is Used In Banking

Banking is a vast platform in which different terms are given to different activities.So the list is given below:

• Linked account- an account which is linked to your current account for the purpose of money transfer is linked account.

• NEFT-stands for national electronic funds transfer. It is an electronic means that helps in money transfer from one bank to another bank within the same branch.According to the Bank, it charges some minimal amount as a fee of transfer.

• Balance transfer- as the name suggests, it is the transfer of Balance from one credit card to another if the balance remains insufficient in current using credit card.

• Base rate-it is the minimum rate of interest at which a bank lends money to its customer.

• MICR code-it stands for magnetic ink character recognition, a nine digit code which is found at the bottom right hand corner of the cheque.

• KYC-which means know your customer it is a procedure that is followed by all banks in order to establish the correct identity of the customer.

• Joint account-it is an account in which two or more people have the same rights on a single account.

• APR-annual percentage rate, which is the interest that you get by depositing your money in your account.

• Simple and compound interest-simple interest is the interest which you get on your deposits whereas compound interest is the interest on your current deposit and the interest on the same deposit previously.

Types of Banks For Banking

There are four types of bank that are listed below:

• Central Bank-it is an independent Center authorized by the government to keep a check on the nation's money supply and different policies. Central banks do not deal directly with the public and are responsible for the stability of currency and the economic system of the country.

• Commercial or corporate banks-these banks provide their services to business clients for starting small business and also help established businesses in funding.

• Investment banks-these banks act as an intermediate between the financial transactions and complex services that are provided to the corporate clients.

• Retail banks-these are the banks that offer their services to the public and have branches in different areas for the convenience of their customers.

Basic Banking Services Provided By The Banks

• Currency exchange-the banks provide foreign currency exchange with the local currency in an easy manner which helps the foreigners to easily accommodate in that particular area.

• Consultancy-Nowadays, banks are hiring financial experts and legal experts which provide the advice regarding the loans and investments that helps the citizens to easily understand the financial terms,profits and loss.

• Overdraft-this service provides the customer to withdraw money more than they have in their deposits and some interest is charged on the withdrawn amount and the customer can return that money in short durations.

• Payment transfer-banks enable the customers to easily transfer funds from one account to another account within the same city or another city.

• Lockers- customers can keep their personal things safely like gold, their important documents in lockers which are provided by banks on minimal charges.

• Credit and debit cards-These cards, provide the customers an access to purchase products and services and even to withdraw money.

Different Types of Loans Provided By Banks

• Personal loans-these loans are provided by the banks to their customers for the expenses like paying a bill or purchasing new equipment for the home. The rate of interest associated with these loans can be higher depending upon the banks.

• Home loans-if a citizen wishes to have a new house and he does not have sufficient funds, He can apply for a home loan and these loans are for a long duration like 20 years to 30 years and rate of interest offered on these loans is also low.

• Small business loans-these loans are provided by the bank for the start-up of small scale or medium scale business to meet the business requirements.

• Study loans-if a student wishes to continue his studies but he/she does not have financial support. He/she can apply for the study loan and that too on zero interest.

What Is E banking?

Here, E stands for electronic that refers to electronic banking.Internet banking, mobile banking and telebanking are some forms of electronic banking.In fact, we can have automated teller machines( ATM), smartcards, debit cards and any check for our easy services. It is more efficient because it is paperless and it takes less time to operate. As E-banking is cashless, we do not need to worry if we don’t have sufficient cash in our pockets while going out because ebanking allows easy transactions within a few seconds.

Different Designations In Banks

Government appoints some Designated people for well services which are as follows:

• Sub staff-The expected salary is between INR 9560 to INR 18545 per month.

• Bank clerks-the current pay scale of bank clerks is between INR 19300 and INR 23,600 per month.

• Probationary officers(PO)-these are also called management trainees. Their pay scale can vary from INR 24,000 to INR 26,000 per month.

• Bank specialists-these are the officers that are recruited in different specific departments like marketing, engineering systems, public relations and management.The pay scale of bank specialists is between INR 42,000 to INR 48,500 per month.

• Manager/assistant manager-becoming a manager in a bank is a difficult task as it needs a lot of experience to manage the above mentioned designations.Salary of a branch manager is never disclosed but it is always above 70,000.