What do you mean by Retail Banking?
Retail Banking is also called personal Banking, which provides all the financial services to customers. It is the way for individual customers to manage their money and access to credit card and debit cards. The consumers can also deposit their money in a safe and secure manner. Such types of services offered by retail banks. It also includes checking and saving accounts and personal loans, credit cards, debit cards.
Explanation of Retail Banking
Nowadays customers expect a range of basic services from many retail banks such as accounts, savings accounts, prepaid debit cards, credit cards, visa cards. Many consumers provide local branch banking services. But most of the customers may not use all of these retail banking services.
The primary service is used to check account balance and deposit money. Nowadays it is a common and secure way for the individual to store their money. It also allows every consumer to get the visa card. Now check account balance and saving accounts also come with prepaid debit cards. That allows the customers to easily withdraw the funds and payments for goods and services. They also offer consumers credit to purchase large scale items such as home and cars. MyPrepaidCenter is a portal to check account balance in Visa cards or Master card directly.
Different types of Retail banking:
Such type of retail banks comes with different types and sizes from local community banks. These types of banking services are of large and global corporate banks such as
- Citibank
- JP Morgan Chase
- Bank of America
- U.S bank2, and
- Wells Fargo.
All these types of banks offer some types of services. which has a large portion of their income. For example, retail banking revenue for JPMorgan Chase made up 48% of the bank's then their total income will be 49% of total profits in the fourth quarter of 2019.
They can also work as a non-profit cooperative. Where they can provide loans and other financial services to other members. Credit unions are another type of banking that provides better interests rate for its members. As they are not seeking profits and they don't have to pay corporate taxes on any earnings.
How a Retail Banking can generate income:
Retail Clients can get cash deposits from retail banking. They use these types of deposits to make loans for other clients. The Federal Reserve requires that all banks have 10% of their demand. And also checking deposits inhouse at night. This is also known as the reserve requirement. Which is seen as a safety and liquidity measure. It means that the remainder of the deposits is allowed to be loaned out.
Some of the banks charge interest rates on such types of loans at a higher rate. This is how retail banks can earn income. Customers can also rely upon the Federal Deposit Insurance Corporation (FDIC) to ensure the bank deposits. They can also add their product by offering a greater range of services for their retail clients. Many banks are providing online services to customers through the Internet and mobile applications. Mobile Internet banking has also expanded the offerings for retail banking customers.ticles