Useful vocabulary about banking

There are many different types of banks. There are the well-known large banking chains with branches all over the world, or the ethical banks that only invest in products that meet their moral standards, or Islamic banks that operate according to Sharia law, and there are microfinance institutions for people with very low incomes.

But can you distinguish your "direct debit" from your "bank identifier code"?? And these are just two of the many special terms used in banking.

First things first: you keep your money in a "current account" and withdraw it when you need it. Such a current account usually includes a "debit card", with which you can withdraw money from your account anywhere in the world at an "ATM" ("automated teller machine" , also known as "cash point").

On a "savings account" you get marginal interest on your savings, but sometimes you have only limited access to your money.

If you need more money than you have saved, you can borrow money from the bank in the form of a "loan" or "overdraft" on your account. When you pay money back to the bank, you have to pay "interest". The loan for a house z. B. is called "mortgage" and can run for many years. The short form "APR" stands for "annual percentage rate" and refers to the annual interest rate you have to pay to the bank when you borrow money from them.

With a "credit card" you can buy goods and services by borrowing money. If you repay the money on time, there is no interest, but if you repay it later, you have to pay interest. "Credit cards" can be useful because they provide "consumer protection" against losses, z. B. if you book an airline ticket and the airline goes bust.

You can pay bills directly from your account, via "direct debit" – where the recipient instructs their bank to collect money from your account. In a "standing order", the payer instructs his bank to transfer money to the recipient on a regular basis.

Transferring money between accounts "to" is also quite easy. If you have online banking, all it takes is the push of a button. Receiving a payment from another country can be more complicated because you need a "swift code". This is a form of "BIC" (or "bank identifier code"), which indicates the country and location of your bank.

To keep track of all debits and credits on your account, the bank sends you a regular bank statement.

For more tips and support, visit EF English Live's English course page.

image: Philip Taylor

My name is Helen, I was born in the UK and I still live here. My great passion is traveling, and I would like to be on the road more often. However, I have talked to more people about their lives via EF English Live than I have on my travels. I've been teaching for 18 years, mostly to newcomers to the UK, but I've also taught briefly in Turkey, Spain, Italy, France and Senegal.

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