Banking and Financial Services

Overview:

In Module 4, we explored the importance of understanding credit and its impact on personal finances. Now, in Module 5, we will delve into the basics of banking and financial services. As we all know, banking institutions play a crucial role in managing money, accessing financial products, and facilitating transactions. In this module, we will cover the functions of banks, and types of accounts.

Learning Objectives:

• Understand the role of banks and financial institutions.
• Learn about different types of bank accounts and financial services.

Functions of Banks

Banks provide various financial services, including:

• Accepting deposits: Banks offer savings, checking, and other types of accounts for individuals and businesses to deposit money.
• Lending money: Banks provide loans, mortgages, and lines of credit to individuals and businesses.
• Facilitating transactions: Banks facilitate payments, transfers, and other financial transactions through electronic and traditional banking channels.

Types of Bank Accounts

• Savings accounts: Accounts designed for saving money and earning interest on deposits.
• Checking accounts: Accounts for everyday transactions, such as paying bills and making purchases.
• Certificates of Deposit (CDs): Time deposits with fixed interest rates and maturity dates.

Banks continue to research consumer needs and exploit other ways of delivering those needs. Do not be surprise to see solicitations in your mail or email about new products that your bank (or any other bank) is offering. You might see something like, ‘We have introducing a new high-yield savings accounts called high yield money market account’. This illustrates how banks innovate and offer new products to meet customer needs and stay competitive in the market.

Financial Services

This demonstrates how banks expand their service offerings to meet the diverse needs of customers and provide comprehensive financial solutions.

• Credit cards
• Loans and mortgages
• Investment services
• Insurance products

This demonstrates how banks expand their service offerings to meet the diverse needs of customers and provide comprehensive financial solutions.

Key Takeaways:

Banks play a vital role in managing money, providing financial products, and facilitating transactions. Different types of bank accounts cater to various financial needs, from saving and spending to investing and borrowing. Recent developments in the banking industry, such as the rise of digital banking and the introduction of new financial products, reflect evolving consumer preferences and market trends.

Next Steps:

In Module 6, we will explore the basics of retirement planning and the importance of saving for retirement. Stay tuned for Module 6: Retirement Planning with The House of Emmanuels Foundation.

Thank you.

Author,
Ogbeni Ridwan (Lawyer; Banker; IT Audit Manager)
Director, The House of Emmanuels Foundation
Raleigh, NC USA