Financial Dictionary -> Banking -> Bank

A bank offers a variety of financial services to their customers. History shows that the main purpose of a bank was to offer loans to trading companies. Businesses then, like today, would have the funds to purchase inventory. Once the goods were sold the business would then owe the bank the amount of the original loan plus interest. Today, one of the main differences is that banks deal not only with businesses but with individuals as well.

The differences in banks are as diverse as the countries in which they are founded. In the United States, banks are not permitted to own non-financial institutions. Banks in France offer real estate and insurance services in addition to their regular financial services.
Regular services of banks generally include:

- Checking accounts
- Savings accounts
- Direct Deposit
- Certificates of Deposit
- Loans
- Debit Cards/ATM
- Check Cashing Services
- Internet Banking Services
- Overdraft Protection (usually dependent on eligibility)
- Other Financial Services

In general banks borrow funds from other companies and individuals and lend them to other companies and individuals at cost plus interest. Banks are usually open only on weekdays; however, in recent years, there are some that are open at least a half day on Saturdays. When dealing with a bank, you can be assured that your money is usually guaranteed up to a set amount, generally up to $100,000, to be secure. In the United States, funds are guaranteed by the FDIC. Most times, banking customers will receive a monthly statement itemizing transactions from their checking and/or savings accounts.

Depending on which country you bank in will determine the services offered as well as the security of your funds. Common law defines the banking business in many English common law countries.