Our glossary of banking terms takes the guesswork out of understanding the fine print of credit card contracts and loans. Now you’ve got a handy resource you can bookmark or print out and get back to every time you need clarification on glossary of banking terms.
Glossary of banking terms:
Account Balance: The money in your account.
Account Statement: A record of your recent transactions, normally within the last month.
ASIC: The Australian Securities and Investments Commission. This is the body that protect consumers, investors and creditors by regulating company and financial services laws.
ATM: Stands for Automatic Teller Machine, where you can withdraw cash and carry out several other services.
Bank Account: A facility for depositing and withdrawing money, and carrying out several other transactions.
Bank Fees: Charged by your bank in return for the services provided to you.
Bank@Post: A facility at many Australia Post outlets whereby you are able to carry out certain transactions and enquiries on your bank account.
BPay: A service allowing payment of bills.
Branch: An outlet of a certain bank.
Cash: Notes and coins.
Cheque: An official slip of paper, provided for people with transaction accounts that can be used instead of cash when the correct details are filled out in the allotted spaces. The cheque is then deposited in the receiver’s account, and shows up as cash.
Credit: A type of loan, allowing the customer to spend up to a certain limit.
Credit Card: A plastic card that allows you to buy things and pay for them later.
Debit Card: A plastic card connected to your bank account. It allows withdrawal of money from ATMs, and payment without cash. It differs from a credit card in that the money is immediately deducted from your bank account.
Deposit: Money put into your account.
Direct Debit: A regular payment from your bank account
EFTPOS: Stands for Electronic Funds Transfer at Point Of Sale. Allows payment without cash using a debit card, and sometimes a withdrawal of cash at the merchant’s till.
Electronic Banking: Any means of banking that works electronically, including ATMs, EFTPOS, and internet and telephone banking.
Financial Adviser/Financial Planner: A person who provides best advice on finances and investments.
Fine Print: The legal and technical details about your accounts.
FOS: Stands for Financial Ombudsman Service, a free and independent service that aims to resolve all manner of customer gripes and complaints against any financial services provider. FOS decisions are final.
Income: Money earned from your job of work, account interest, share dividends, property rentals.
Interest: The amount a borrower pays to a lender for granting a loan. Also paid by banks to customers on certain bank accounts.
Internet Banking: Any banking transaction or enquiry carried out over the internet.
Money Laundering: An illegal act where money earned from criminal activities is ‘cleaned’ by putting it through a legitimate account.
Overdrawn: The situation when your funds go below zero, or a level below zero that has been agreed by the bank. This can happen when a direct debit is taken when there are insufficient funds in the account. Fees are often charged on overdrawn accounts.
Over-The-Counter: Any in-branch transaction.
PIN: Stands for Personal Identification Number, known only to the customer and keyed into ATMs/EFTPOS terminals to ensure only the account-holder can withdraw funds from their account.
Savings: Money put aside for the future.
Tax File Number (TFN): A unique number identifying a person for tax purposes.
Telephone Banking: Any banking transaction or enquiry carried out over the telephone.
Term: A specified length of time.
Term Deposit: An account that locks money away for a certain time, in return for a higher rate of interest.
Terms & Conditions: The legal details relating to the contracting of a new bank account.
Transactions: Any activity that affects the balance of your account.
Transfer: Moving money between accounts.
Withdrawal: Removing money from an account.