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A debit is a type of financial transaction that involves the withdrawal of funds from an account. It is a payment method that deducts the transaction amount directly from the account balance. Types of Debits 1. Point of Sale (POS) debit: In-person transactions using a debit card. 2. Online debit: Electronic transactions using a debit…
A bank statement is a document provided by a bank to its customers, detailing all transactions conducted on their account over a specific period. It serves as a record of all deposits, withdrawals, and other account activities. Types of Bank Statements 1. Monthly statement: Summary of transactions for a calendar month. 2. Quarterly statement: Summary…
A balance represents the current state of an account, showcasing available funds, outstanding debts, or pending transactions. Types of Balances 1. Account balance: Current account status. 2. Available balance: Funds ready for use. 3. Ledger balance: Total account value. 4. Current balance: Real-time account status. 5. Outstanding balance: Unpaid debts. Balance Sources 1. Deposits. 2….
An Automated Teller Machine (ATM) is a self-service kiosk that allows users to perform financial transactions, such as withdrawals, deposits, and balance inquiries, using a card and PIN. Types of ATMs 1. Bank ATM: Owned and operated by banks. 2. Independent ATM: Owned and operated by private companies. 3. Online ATM: Internet-enabled ATM. 4. Mobile…
Credit refers to borrowed funds provided by a lender to a borrower, typically with interest and repayment terms. Credits enable individuals and businesses to access funds for various purposes, such as financing purchases, managing cash flow, or covering unexpected expenses. Types of Credit 1. Installment credit: Fixed payments over a set period (e.g., mortgages, car…
A deposit is a financial transaction that involves adding funds to an account. It is a crucial aspect of banking and finance, enabling individuals and businesses to manage their money effectively. Types of Deposits 1. Cash deposit: Physical cash deposited into an account. 2. Electronic deposit: Funds transferred electronically. 3. Direct deposit: Automatic transfers from…
Interest is a fee charged or earned on borrowed or invested funds. It is a crucial aspect of personal and business finance, influencing financial decisions and outcomes. Types of Interest 1. Simple interest: Calculated on principal amount. 2. Compound interest: Calculated on principal and accrued interest. 3. Annual Percentage Rate (APR): Interest rate charged annually….
An investment is a financial asset or instrument purchased with the expectation of generating income or profits. Investing involves risk but can provide long-term financial growth and security. Types of Investments 1. Stocks: Equity in companies. 2. Bonds: Debt securities. 3. Mutual Funds: Diversified portfolios. 4. Exchange-Traded Funds (ETFs): Traded on stock exchanges. 5. Real…
A loan is a financial agreement where a lender provides borrowed funds to a borrower with the expectation of repayment, typically with interest. Loans cater to various needs, such as financing purchases, managing cash flow, or covering unexpected expenses. Types of Loans 1. Personal loan: Unsecured, for individual use. 2. Mortgage loan: secured for real…
A savings account is a type of bank account designed to help individuals save money while earning interest. Benefits 1. Earn interest: Grow savings over time. 2. Security: insured and protected. 3. Liquidity: Easy access to funds. 4. Low risk: stable investment. 5. Encourages savings: Separate from spending money. Types 1. Traditional savings account: Basic…