What is Bank?
Almost all of us have been to the bank for some of the other reason. It is a financial organization, which is licensed by the government of a country to carry out money related transactions or deals with substitutes of money. These dealings are done by accepting demand as well as time-based deposits, investing in securities and making loans. Profit for a bank is earned by the difference in the rate of interest that it charges to and pays to its customers.
What are the different service types offered by the bank?
In simple words, banks deal with their customer’s money and valuables. They provide financial servicesthat can help people to manage their lives in a better way. With increasing competition, banks are offering attractive and current services to their customers.
Knowing different types of the services provided by bank helps a lot so that you get the maximum benefit out of your financial institution. , It also helps in choosing the best bank for your needs.
Different types of services offered by banks:
1. Individual banking:
These services include those that are offered to individuals to manage their financial needs. It includes services such as:
- Savings accounts.
- Checking accounts.
- Personal and allied insurances.
- Credit and debit cards.
- Loans.
- Wealth management.
2. Business banking:
Most of the banks offer services for businesses as well as the personal needs of business owners. Different business banking services include:
- Business loans.
- Savings accounts.
- Checking accounts.
- Business credit and debit cards.
- Cash management services such as deposit, payroll services etc.
- Merchant services such as check collection, credit card processing, reporting and reconciliation.
3. Digital banking services:
This gives users to manage their finances online using a computer, smartphone or tablet. This is becoming more and more popular amongst banks. Digital naming services offered by banks include:
- Tablet, online and mobile banking.
- Text alerts.
- Mobile check deposit.
- Online bill payments.
- eStatements.
4. Loans:
This is a common banking service, which is available to businesses as well as individuals. Loans are offered for offices, homes, vehicles, business start-ups and various other reasons. They come in all sizes and shapes. Some common types of bank loans offered include:
- Personal loans.
- Home loans.
- Business loans.
- Home equity loans.
- Home equity lines of credit.
Different types of banks:
Commercial banks: These accept money as deposits from its customers and gives loans as well as advances to other customers by giving interest. They lend money for a small span of time and mainly provides working capital for businesses. They accept deposits such as savings, fixed, seasonal, current, and recurring, etc. they give loans such as overdrafts, loans, cash credits and discounting bills.
Co-operative banks: They provide short, medium and long-term credit for agricultural purposes. They also provide loans for small-scale businesses and artisans at a cheaper rate of interest. They are mainly found in rural areas and in some urban areas too.
Central bank: Every country has a central bank, which is a non-profit organization. It is involved in regulating the credit and monetary system of the country. It acts as a supervisor, controller, and regulator of commercial bank’s activities as well as of other financial institutions present in the country.
Another type of banks also exists such as:
- Industrial banks
- Agricultural banks
- Savings Bank
- Foreign exchange banks
- Private bankers
- Chit Funds.
Conclusion:
Banking services have become an indispensable part of our daily lives and so knowledge of working of a bank is imperative. It is important to understand the offerings of a bank clearly before choosing it for your transactions.
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