While it sounds pretty straightforward, personal banking has a comprehensive range of services designed to serve the needs of individual people. Personal retail banking is a type of banking service and product line provided by banks to retail customers.
Also known as retail banking or consumer banking, personal banking is a financial service offered by banks and some other financial institutions to individual people. The consumers of this particular banking service are the people themselves, not their businesses or other organizations they own or work for.
To elaborate, consumer banking is the service which is offering to individuals to manage their money. It includes securely depositing their money and earning interest on it while also getting access to credits. Usually, these services include checking accounts, savings accounts, personal loans, mortgages, credit cards, and personal loans. Consumers can also obtain a certificate of deposits (CD) if required.
It is Different From Corporate Banking
Contrary to personal banking, corporate banking is the banking services which provide directly with corporate customers such as corporations, businesses, service providers, etc. Like retail banking, however, the service includes loans, credits, checking accounts, saving accounts, etc. All of these services are designing differently than what is offered to individuals. Catering to the different needs of the companies and offering some suitable solutions to their investment and liquidation needs.
Retail banking is also more visible to the masses than corporate banking, thanks to the way they work. To make banking services more accessible. Banks usually set up many branches in most major cities, bringing banking services to the doorsteps. For corporate banking, most of the work happens directly with the businesses and behind the scenes. Thanks to the internet, however, a lot of consumer banking services can now be performed online. This is what is enabling many challenger banks or modern banks to go totally branchless and to the internet.
These two services are so close, though. The money deposited by individuals in their savings accounts often get loans to corporate clients and businesses. It allows the bank to put money to work and earn a profit, while also paying individuals interest on deposits.
Types of Services Offered by Retail Banking
Traditionally, individuals can perform a wealth of financial activities by opening up a personal banking account with a retail bank or financial institute. Depending on the kind of accessibility you need, you can opt for a checking account or a savings account. Often, you can also open an account to deposit a fixed amount periodically to earn a bigger percentage on interests.
Moreover, retail banks also offer individuals to go overdraft, to take a personal loan, mortgage, and other lines of credits. It also enables them to obtain credit cards and debit cards, paying bills and installments, and so on effortlessly.
In this digital age, many fintech banks are offering retail banking services entirely online, and thus, making it more accessible. Some of these hi-tech banks sometimes also offer enhanced services like holding multiple currencies, transferring money and paying bills globally, trading bonds, stocks, and securities, etc.