Editor: Namit Singh Sengar
Last updated: Feb 07, 2023 4:06 PM IST
There are certain services that are widely used in everyday banking and finance. (Representative image)
The bank has several services that are called abbreviated, and people may not be familiar with them.
Banks and the entire financial system operate according to several parameters, which are developed and determined by the competent authorities from time to time. Since banking is a service sector and is associated with daily public transactions, several terms are used in the system.
These terms are services/or definitions of a specific procedure. Sometimes these terms are not familiar to ordinary people and they end up getting confused or taking the time to dispel doubts.
Here is a list of ten words/terms that are widely used in everyday banking and finance.
OIL: This means national electronic funds transfer. As the name suggests, this is the process of transferring funds from your bank account. This is an electronic means for transferring money from one account to another, regardless of the branch and bank. However, OIL does involve some fees depending on the bank and the amount.
IMPS: This is Immediate Mobile Payment Services, another interbank money transfer system where money is sent in real time. This means that the transaction is instant and the balance is reflected immediately.
RTGS: Real-time gross settlement is another funds transfer system available for banks to transfer funds. Usually used for large amounts. For example, at the State Bank of India, a minimum of 2 lakhs can be transferred through RTGS, while in OIL you can transfer 1 rupee as a minimum amount.
plastic money: This term is commonly used to refer to the currency used by people other than cash. It is commonly used to refer to debit and credit cards.
KYC: “Know your customer” is mandatory procedure that all banks/NBFCs and other RBI regulated entities must implement to verify the identity of the customer. This includes presenting a set of documents such as an Aadhaar map or a PAN map.
Credit history: This is a record of a customer’s past credit behavior. The credit bureau, like CIBIL, collects information about the client. This is checked by lenders before they grant you a credit assessment.
Are you planning to take out a loan? Know what CIBIL Score is; Check all details
MICR code: Magnetic ink character recognition code. is a nine-digit code that is printed in the lower right corner of bank checks. This helps clear your check quickly and without hassle.
IFSC code: Indian financial system code, is an 11-character alphanumeric code. This is necessary to transfer money between bank accounts. This facilitates the transfer of funds from one bank account to another electronically.
Mobile banking: Currently, most banks offer services in digital form, which can be used in various modes. One of such methods is mobile banking, when the client uses banking services using a mobile phone, following the steps indicated by the respective banks.
repo rateA: The REPO rate is the annual interest rate on funds transferred from a lender to a borrower. This is the rate at which the RBI lends money to commercial banks.
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