What Is Annual Percentage Rate (APR)? Annual percentage rate (APR) refers to the yearly interest generated by a sum that’s charged to borrowers or paid to investors. APR is expressed as a percentage that represents the actual yearly cost of ...
What Is a Bank Account Number? A bank account number is a unique string of numbers and, sometimes, letters and other characters that identify a particular bank account and grant access to it. This often is one of the most ...
Hard Money vs. Soft Money: An Overview There are several ways to define the terms "hard money" and "soft money." How you define them depends on what context you take. In their simplest form, hard money and soft money are ...
Retail Banking vs. Corporate Banking: An Overview Retail banking?is a bank's services that deal directly with consumers, while corporate banking is the part of the banking industry that serves business or corporate customers. Retail banking is the face of banking ...
What Is a Financial Institution (FI)? A financial institution (FI) is a company engaged in the business of dealing with financial and monetary transactions such as deposits, loans, investments, and currency exchange. Financial institutions include a broad range of business operations ...
What Is a Letter of Credit? A letter of credit, or a credit letter, is a letter from a bank guaranteeing that a buyer¡¯s payment to a seller will be received on time and for the correct amount. If the ...
What Is a Depository? The term depository can refer to a facility in which something is deposited for storage or safeguarding, or an institution that accepts currency deposits from customers, such as a bank or a savings association. A depository ...
What Is a Demand Deposit? A demand deposit account (DDA) is a bank account from which deposited funds can be withdrawn at any time, without advance notice. DDA accounts can pay interest on the deposited funds but aren¡¯t required to. ...
What Is the Federal Deposit Insurance Corp. (FDIC)? The Federal Deposit Insurance Corp. (FDIC) is an independent federal agency insuring deposits in U.S. banks and thrifts in the event of bank failures. The FDIC was created in 1933 to maintain ...
What Is a Bank Run? A bank run is when the customers of a bank or other financial institution withdraw their deposits at the same time over fears about the bank's solvency. As more people withdraw their funds, the probability ...