Chapter 8 - Introduction to Commercial Banks Flashcards
Define commercial bank.
A business that provides financial services to personal and business customers.
Define a savings/deposit account.
An account for customers who want to save money. Interest is saved each year on the amount saved.
Define a current account.
An account for customers who want to pay bills and other expenses on a regular basis.
Define DIRT.
Deposit Interest Retention Tax. This is the tax paid on interest earned on savings.
Define ATM.
Automated Teller Machine.
Define lodgement.
Putting money into your savings or current account.
Define withdrawal.
Taking money from your savings or current account. (E.g. By using withdrawal slip, ATM, cheque.)
Define PIN.
Personal Identification Number.
Define 24 hour banking.
Telephone and Internet banking which allows customers to carry out a range of banking services 24 hours a day, 365 days a year.
Define a night safe.
A metal drawer located in the wall of most bank branches. They are used by customers who need to lodge large amounts of cash when the bank is closed. Useful for owners of pubs, late night shops.
Define IBAN.
International Bank Account Number. An internationally agreed means of identifying bank accounts internationally.
Name the commercial banks in Ireland.
AIB, Bank of Ireland, Ulster Bank and Permanent TSB.
What are the advantages of a deposit account?
- You receive interest on your savings each year.
- Your savings are safe.
- You can withdraw money using ATMs.
What are the advantages of a current account?
- Customers can use a cheque or Laser card to pay for goods and services, which is safer and more convenient than having to pay with cash.
- You can have your wages paid directly into your current account (Paypath).
- Customers can apply for a bank overdraft.
List the differences between a current account and a deposit account.
- No interest earned on a current account. Interest earned on a deposit account.
- Overdraft facility on a current account. No overdraft facility on a deposit account.
- Cheques and Laser card facilities with a current account. No cheques or Laser card facilities with a deposit account.