Retail Banking

Retail Banking

Retail Banking-A retail bank is a bank  which works with consumers directly.

Retail banks allow consumers to purchase homes, cars and consumer products by providing mortgages and loans. In this way, they provide needed liquidity to keep the economy growing.

Retail banks provide a safe place for people to deposit their money by  offering savings accounts, CDs (certificates of deposit) and other financial products. Retail banks also provide checking accounts. All of this can be done online, which has become an important added convenience. Retail banks primarily make money by charging higher interest rates on their loans than they pay for deposits.

Banking is a process which is done by the bankers.
Retail banking is a process of  high volume business with many service  providers competing for market share.


Retail banks provide basic banking services to the general public, including:

•    Checking current and savings accounts
•    Certificates of Deposit CDs
•    Safe deposit boxes
•    Mortgages and second mortgages
•    Auto loans
•    Unsecured and revolving loans such as credit cards
•    payments — debit cards, cheques, etc;
•    short-term unsecured loans — such as credit cards;
•    money management facilities — for example, your current account;
•    savings — deposit accounts and, increasingly, other forms of savings and investments;
•    loans — such as car loans;
•    mortgages.
Retail banks are the banks you most often see in cities on crowded intersections, the ones you probably use for your personal checking account.
In addition to helping consumers, retail banks often serve businesses as well – so they can also serve as commercial banks.

Definition of ‘Retail Banking’

Typical mass-market banking in which individual customers use local branches of larger commercial banks. Services offered include savings and checking accounts, mortgages, personal loans, debit/credit cards and certificates of deposit (CDs).

Investopedia explains ‘Retail Banking’

Retail banking aims to be the one-stop shop for as many financial services as possible on behalf of retail clients. Some retail banks have even made a push into investment services such as wealth management, brokerage accounts, private banking and retirement planning. While some of these ancillary services are outsourced to third parties (often for regulatory reasons), they often intertwine with core retail banking accounts like checking and savings
to allow for easier transfers and maintenance.

Wikipedia explains ‘Retail Banking’
Retail banking is banking in which banking institutions execute transactions directly with consumers, rather than corporations or other banks. Services offered include savings and transactional accounts, mortgages, personal loans, debit cards, and credit cards.

Financial Dictionary explains ‘Retail Banking’

Retail Banking is a Banking services that are offered to individual customers through local branches of the bank. Examples of retail banking services include checking and savings accounts, credit cards, personal lines of credit, mortgages, and so forth. Some retail banks offer basic brokerage services, though this is not always the case. Retail banking contrasts with commercial banking, which primarily offers services to businesses.

Investor glossary explains ‘Retail Banking’

Retail banking is a banking service that is geared primarily toward individual  consumers. Retail banking is usually made available by commercial banks, as  well as smaller community banks. Unlike wholesale banking, retail banking  focuses strictly on consumer markets. Retail banking entities provide a wide  range of personal banking services, including offering savings and checking  accounts, bill paying services, as well as debit and credit cards. Through  retail banking, consumers may also obtain mortgages and personal loans.

Although retail banking is, for the most part, mass-market driven, many retail  banking products may also extend to small and medium sized businesses.
Today much of retail banking is streamlined electronically via Automated  Teller Machines (ATMs), or through virtual retail banking known as online  banking.

Nowadays, banking leadership increasingly comes from being the better retailer – providing the best service to customers with maximum efficiency.
Importantly, banks need agile technology and business processes to support, rather than inhibit their ambitions:
•    Have a single, complete view of customer relationships, so staff  can deliver the optimum level of customer service
•    Easily design, deploy and monitor the progress of new products and services
•    Deliver information to customers from any appropriate channel in a consistent and cost effective way
•    Run multiple, sales and marketing campaigns, simultaneously, to enable effective cross-selling
•    Turn large volumes of data into actionable information, accurately
•    Deploy fully automated, best practice business processes to bring the efficiency of straight-through-retailing into a traditionally manual banking world
•    Improve levels of compliance and security – and be prepared for future regulatory requirements

Legacy core banking systems are increasingly unable to cope in today’s increasingly complex, globally organized financial markets. It may be impossible to support the latest product innovations, divergent range of distribution channels or bring new products to market to capitalise on trends before they become mainstream and when it is, the process is often complex, time-consuming and expensive. In today’s business environment, banks are increasingly looking for well established, resilient and flexible banking solutions to support a business which is going though unprecedented change.

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