What are the types of bank accounts?

What are the types of bank accounts?

If you are looking for bank account types, you are in the right place. Of course, there are many types of bank accounts, where each type has different advantages over the other.

The common types of bank accounts include the following:

1. Savings Account

A savings account is a bank account in which the customer can deposit money he does not need or money in excess of his need, and of course he can withdraw this money when needed. Banks lend money to borrowers and charge interest on the amount of credit spent.

2. Checking account

A checking account allows customers to easily access their deposited funds, which they can use to conduct financial transactions, such as paying bills. Customers can access the funds by writing a check, withdrawing funds, making a payment with a debit card, or setting up automatic transfers to another account.

3. Certificate of Deposit

A certificate of deposit is a bank account that holds a fixed amount of funds for a specified period of time (eg six months, one year, two years, etc.). A fixed rate of interest is paid on the amount retained.

Here are the most common types of banks:

1. Commercial banks

Commercial banks are the most common type of bank. They offer various services such as offering business loans to individuals and private companies, accepting deposits and offering basic investment products.

Commercial banks also provide other financial services such as global trade services, trade services, insurance products, retirement products, and treasury services. They earn money by providing business loans to individual and corporate borrowers, and taking appropriate interest for these loans, in addition to charging service fees.

2. Credit Union

A credit union is a type of bank that is open to a specific group of people who are eligible for membership. It is owned and operated by members on the basis of helping people. Credit unions have traditionally provided services to residents of local communities, church members, employees of certain businesses or schools, and others.

Credit unions' ownership structure allows them to offer more personalized and cheaper banking services to their members. Because of smaller operations, credit unions may pay higher interest rates than banks, and customers can develop better relationships with bank employees. On the downside, credit unions have limited operations and it is not easy for customers to deposit.

3. (Investment Banking)

Investment banks are banks that allow corporate clients to access the capital markets to raise capital for expansion. Helps companies raise capital in the stock and bond markets to fund their expansions, acquisitions, or other financial plans. They also facilitate mergers and acquisitions by identifying viable acquirers that meet buyer criteria.

Investment banks make money by advising their corporate clients, transacting in the financial markets, and representing clients in mergers and acquisitions. Some examples of large US investment banks include Merrill Lynch, Goldman Sachs, JPMorgan, and Bank of America.