Banks offer a wide variety of services, from loans and checking accounts to investments and insurance. Each bank offers different services, but there are some basics that you can expect from any banking institution.
This article will go over the four main types of banking services you can expect to find at most well-established banks.
Checking Accounts
A checking account is a type of deposit account with which most people are likely familiar. Checking accounts allow customers to deposit money into an account and make withdrawals or purchases using a debit card or check.
In many cases, you will be able to manage your checking account online or through a mobile app. Many banks also offer perks such as rewards programs and overdraft protection for customers who open a checking account with them. Reward programs may include cashback offers or points for purchases made with your debit card.
Overdraft protection usually works by granting customers a certain amount of overdraft coverage for their accounts. This way, if you accidentally spend more than what's in your account, the bank will cover it up to the agreed-upon limit.
Savings Accounts
Savings accounts are another type of deposit account where customers can store their money safely. Unlike a checking account, savings accounts generally don't come with debit cards or checks. Instead, they allow customers to earn interest on their deposits over time.
Savings accounts often have restrictions on how much money you can withdraw each month, so they're not ideal for day-to-day spending but are great for building up long-term savings goals. They may also have higher interest rates than checking accounts, making them perfect for those who are looking to grow their money over time.
Loans and Credit Cards
Most banks offer loans and credit cards to their customers who need access to funds in the short term. Loans typically come with fixed repayment terms, while credit cards provide more flexibility in terms of repayment schedules, interest rates, and rewards programs.
Loans typically carry a lower interest rate than credit cards, but they usually require collateral or a cosigner to get approved. Credit cards often have higher interest rates, but they generally don't require collateral or a cosigner. They can also come with more rewards and benefits than loans, such as cashback offers or points for purchases made with the card.
Investment Services
Many banks now offer investment services as well as traditional banking services. These services allow customers to invest their money in stocks, bonds, mutual funds, and other securities with the help of an experienced financial advisor who works at the bank itself.
Investment services can be a great way to diversify your portfolio or take advantage of tax breaks offered by certain types of investments — just make sure you understand all the risks involved before putting your money into them.
