BANKING.

Transcription

1 BANKING

2 Bank financial institution licensed by a government. Its primary activities include borrowing and lending money. Many other financial activities were allowed over time. Example: banks are important players in financial markets and offer financial services such as investment funds.

3 Commercial Banks Offer four main services 1. They accept customers deposits. 2. They pay cheques drawn on them by thir customers 3. They grant advances to customers 4. They provide a payments mechanism for the transfer of funds between its own customers and those of other banks

4 Traditional banking activities Banks act as payment agents by conducting checking or current accounts for customers, paying 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.

5 A transactional account (North America: checking account or chequing account, United Kingdom and some other countries: current account or cheque account) is a deposit account held at a bank or other financial institution, for the purpose of securely and quickly providing frequent access to funds on demand, through a variety of different channels. Because money is available on demand these accounts are also referred to as demand accounts or demand deposit accounts.

6 Kinds of Bank Account A. Current Accounts The most usual type of bank account Deposits in the account can be withdrawn on demand

7 Standing Order (or a Standing Instruction) is an instruction a bank account holder gives to their bank to pay a set amount at regular intervals to another account. The instruction is sometimes known as a banker's order. A direct debit or direct withdrawal is an instruction that a bank account holder gives to his or her bank to collect an amount directly from another account. It is similar to a direct deposit but initiated by the beneficiary. It is also called preauthorized debit (PAD) or pre-authorized payment (PAP).

8 Kinds of Bank Account B. Deposit Accounts deposit account is a current account, savings account, or other type of bank account, at a banking institution that allows money to be deposited and withdrawn by the account holder. These transactions are recorded on the bank's books, and the resulting balance is recorded as a liability for the bank, and represent the amount owed by the bank to the customer. Some banks charge a fee for this service, while others may pay the customer interest on the funds deposited.

9 Cheque A cheque, also spelled check is a negotiable instrument instructing a financial institution to pay a specific amount of a specific currency from a specified demand account held in the maker/depositor's name with that institution. Both the maker and payee may be natural persons or legal entities.

10 Canadian Cheque Sample

11 Telegraphic Transfer or Telex Transfer Telegraphic Transfer or Telex Transfer, often abbreviated to TT, is an electronic means of transferring funds overseas. A transfer charge is collected while sending money. A banking term commonly called "T/T," meaning a cable message from one bank to another in order to effect the transfer of money. It most often used in UK Banking to refer to a CHAPS transfer; that is a payment made via the Clearing House Automated Payments System. The term is also used to describe other electronic funds transfer methods and, incorrectly, BACS (Bankers Automated Clearing Services) and AFTS (Automated Funds Transfer System) payments.

12 EFTPOS (Electronic Funds Transfer at Point of Sale) is an Australian and New Zealand financial network for processing credit cards, debit cards and charge card payments at "Point of Sale" and transacting at ATMs. EFTPOS also allows users of the system to withdraw cash at the time of purchasing a product or service through the merchant's EFTPOS terminal. This functionality is called debit card cash back in other countries.

13 Example Of Banking Letter

14 Request to open account The Manager National Bank Ltd Dear Sir, I have recently moved into this town and opened a general stores at the above address. Having been recommended to your bank by Mr James Currie, one of your customer, I wish to open a current account with you and should be glad if you would suggest a day and time when I may call on you to discuss the details/ I will provide references should you required them. Yours faithfully

15 Notification of signatures to The Manager National Bank Ltd bank Dear Sir, At the meeting of the Board yesterday it was decided that cheques drawn on the company s account must bear two signatures instead of one as formerly. One of the signatures must be that of the chairman or secretary and the other that of any member of the Board. The change takes place as from today. As no change in membership of the Board have occurred since I wote to you on 3 rd July 2009, I take it there will be no need to submit further specimen signatures. I enclose a certified copy of the Board s resolution signed by the chairman. Yours faithfully.

16 Request for bank statement The Manager National Bank Ltd Dear Sir, Would you please send me statements for our No 1 and No 2 accounts, made up at close of business on 30 th June. As these statements are needed for a director s meeting arranged for next Friday, 10 th July, I should bee obliged if you would send them to reach me not later than the morning of the 9 th. With the statements please include a certificate of balance on deposit account as at close of business on 30 th June. Your faithfully

17 References Taylor, Shirley Model Business Letters, s & Other Business Documents. Harlow: Pearson Education Limited equesample.png