Other Banks

Banks operate to serve domestic consumers, businesses and other entities by offering various financial services and products. In retail banking, a financial company offers financial services that can be attractive to individuals and mass consumer market. They integrate interest rates to bank account deposits such as savings account, certificate of deposit or time deposit accounts and IRA’s. They can also offer customers the opportunity to issue checks as alternative to cash disbursements using banknotes. They can issue different kinds of cards as modes of cashless purchases. They can grant different kinds of loans to different personal borrowers with various purposes. The extension of loans can be a way of increasing a bank’s portfolio.

Banks that offer financial services to consumers are normally known as retail or consumer banks. They can be found in urban and rural areas. They can be a small bank company or a branch division or subsidiary of a larger financial institution that also offers commercial wholesale banking services. Notably, the latter character carries a widely-known brand.

Retail bank types can be commercial bank; community development bank; private banks and savings bank.

Commercial bank is a typical kind of bank that offers a wide range of financial services for personal customers. It can also provide other forms of services beyond retail banking serving businesses, corporate entities and other large institutions.

Community development bank is a type of retail bank that offers financial services to areas that are not yet developed or are underserved.

Private bank is regarded is a higher-form of bank type for it mostly serves elite individuals or persons with high net worth. It primarily offers personalized banking. Aside from providing typical banking services to classy type of customers, it can also extend other forms of financial services that could include investment services.

Savings Bank is another kind of retail bank that primarily provides savings account for individual depositors. It can also grant personal loans and home mortgage credit.

Aside from retail banking, other banks can engage in wholesale banking. They cater to large corporations, middle-market and small businesses. It is sometimes referred to as business banking doing business-to-business banking.

Other bank services can include investment services and wealth management. These and other forms of financial services can be found in investment banks. These kinds of financial services can also be availed in commercial banks as they can include investment banking in their service offers.

Investment banks conduct certain forms of financial services by assisting corporate and government entities in raising funds through investment in capital markets. Investment bankers can also provide advisory services to their specific types of clients.

Banks usually provide deposit accounts and loans. While other banks can perform advisory services, engaging in investment services and may offer insurance products.

However, questions may arise regarding the operational activities of banks such as: How to bank using other banks and how do banks compete with other financial services?

The integration of advanced technology besides the common activities of banks can contribute to the competitive advantage of a bank from the other banks or financial companies. Online banking, telephone banking, issuance of widely acceptable card, attractive interest deposit rates are some of the banking features that banks can heavily invest in to obtain a sustainable market share.

Meanwhile, the use of ATM or automated teller machines can make it possible to bank with other banks. Even if a customer is not a patron of a particular bank, he can use the ATM machine of that bank to withdraw cash or to avail of other financial services available to that bank’s ATM. Other banks’ ATM machine can also do this. However, banks may charge non-customer users of their ATM’s.

Banks do not merely engage in their customers. They can also interact with other banks and may involve in community development.