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Banking & Financial Services

In general terms , the business activity of accepting and safeguarding money owned by other individuals and entities , and then lending out this money in order to earn a profit

Banking is generally a highly regulated industry, and government restrictions on financial activities by banks have varied over time and location.

Abankis a financial intermediary and appears in several related basic forms:

• a central bank issues money on behalf of a government, and regulates the money supply
• a commercial bank accepts deposits and channels those deposits into lending activities, either directly or through capital markets . A bank connects customers with capital deficits to customers with capital surpluses on the world's open financial markets .
• a savings bank , also known as a building society

 

Standard activities:

Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers on the bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer payments via other payment methods such as telegraphic transfer , EFTPOS , and ATM .

Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as bank notes and bonds . Banks lend money by making advances to customers on current accounts, by making installment loans , and by investing in marketable debt securities and other forms of money lending.

Banks provide almost all payment services, and a bank account is considered indispensable by most businesses, individuals and governments. Non-banks that provide payment services such as remittance companies are not normally considered an adequate substitute for having a bank account.

Banks borrow most funds from households and non-financial businesses, and lend most funds to households and non-financial businesses, but non-bank lenders provide a significant and in many cases adequate substitute for bank loans, and money market funds, cash management trusts and other non-bank financial institutions in many cases provide an adequate substitute to banks for lending savings too.

Channels:

Banks offer many different channels to access their banking and other services:

• ATM is a machine that dispenses cash and sometimes takes deposits without the need for a human bank teller . Some ATMs provide additional services.
• A branch is a retail location
• Call center
• Mail : most banks accept check deposits via mail and use mail to communicate to their customers, e.g. by sending out statements
• Mobile banking is a method of using one's mobile phone to conduct banking transactions
• Online banking is a term used for performing transactions, payments etc. over the Internet
• Relationship Managers , mostly for private banking or business banking, often visiting customers at their homes or businesses
• Telephone banking is a service which allows its customers to perform transactions over the telephone without speaking to a human
• Video banking is a term used for performing banking transactions or professional banking consultations via a remote video and audio connection. Video banking can be performed via purpose built banking transaction machines (similar to an Automated teller machine), or via a videoconference enabled bank branch clarification

 

Products:

Retail

• Business loan
• Cheque account
• Credit card
• Home loan
• Insurance advisor
• Mutual fund
• Personal loan
• Savings account

 

Wholesale

• Capital raising ( Equity / Debt / Hybrids )
• Mezzanine finance
• Project finance
• Revolving credit
• Risk management ( FX , interest rates , commodities , derivatives )
• Term loan

 

Types of banks:

Banks' activities can be divided into retail banking , dealing directly with individuals and small businesses; business banking , providing services to mid-market business; corporate banking, directed at large business entities; private banking , providing wealth management services to high net worth individuals and families; and investment banking , relating to activities on the financial markets . Most banks are profit-making, private enterprises. However, some are owned by government, or are non-profit organizations

Types of retail banks:

Commercial bank , Community banks , Community development banks , Credit unions , Postal savings banks , Offshore banks , Savings bank Building societies and Landesbanks , Ethical banks , Direct or Internet-Only bank

Types of investment banks:

Investment banks , Merchant banks ,

Both combined:

Universal banks , more commonly known as financial services companies, engage in several of these activities

Other types of banks:

Central banks , Islamic banks