Ten most commonly used Banking Terms are given below:
Checking Account: An account which is used to deposit money and from which you can write cheques for purchases. Most people use checking accounts to pay their bills and receive wages.
Overdraft Fee: The fee incurred by the account if it has a lesser amount of balance to make the payment. The gap between the amount and the payment is taken care of by the bank but then the balance goes into negative.
Returned Item Fee: The charge made by the bank to the person trying to deposit the cheque. It can be made if there are insufficient funds in the cheque writer’s account or if the account is closed.
Savings Account: Typically, an interest-bearing account which is used for deposits and hold money for short term or long term goals or emergencies.
Annual Percentage Rate: The amount of interest you gain from keeping money in an account in a year, not including compound interest.
Cash Reserves: It refers to the money a business or individual keeps on hand to meet short term and emergency funding needs. It can also refer to a short term highly liquid investment that earns a low rate of return.
APY: The amount of interest you gain from depositing money in an account, including compound interest.
Certificate of Deposit: An account into which you deposit a sum of money and agree to keep it there for a specified period of time. The account usually pays a higher rate of interest than standard savings and checking accounts.
Assets: The personal possessions of value which the bank has. It includes money, infrastructure, investments, real estate, etc.
Adjustable Rate: A rate of interest that can vary during the term of the loan.