This presentation consists of Banking Terms, Types of Bank Accounts and Types of Bank Cheques

3. Ch. 06: Bank & Banking
Transactions
Topics;
• Definition of bank
• Types of bank accounts
• Advancing of loans
• Cheques and its types
• Important banking terms

4. Definition of Bank

5. Process of opening a bank
account
1. Formal Application: for opening a bank account,
customer fills an application form .
2. Obtaining Introduction: Before opening a bank
account, banker may ask some formal questions
from the customer
3. Specimen Signatures: When the banker is satisified
about the customer, he takes specimen signatures
from the customer on a card “signature card”

6. Name of account holder:
SNAWER GILL____ Snawer
Snawer Snawer

7. 4. Initial Deposit: For opening a bank account, first
deposit may be minimum of Rs. 500 or Rs. 1000
5. Operating of account: When an account is
opened, banker gives to the customer following
books to operate it;
• Pay-in-slip book
• Pass Book
• Cheque Book

8. 1. Pay-in-Slip Book: It is a book that contains blank
printed form provided by the banker to its
customer. It is used to deposit money into bank.
2. Pass Book: It is a book that is used to record all
the banking transactions. All the amounts paid into
bank and withdrawn from bank are recorded in it.
2. Cheque Book: It is a book that contains blank
printed form provided by the banker to its
customer. It is used to draw money from the bank.

14. Loans and advances
Bank makes the following types of
loans.
• Short-term loans (for 1 year)
• Medium term loan (for 1-5 years)
• Long term loan (for 5 to 15 years)

15. Bank Over draft
Sometimes, bank allows its trust
worthy clients to overdraw
money up to a certain limit, this
extra money is called overdraft.
Bank charge interest on this
money.

16. Cheque and its
Types

17. Cheque

18. 1. Bearer Cheque: A cheque
that is payable to any person
who may present it at bank on
which it is drawn.

20. 2. Order Cheque: A cheque that is
only payable to a person whose
name is written on it. For the
payment of this cheque, banker
may demand identification from
that person.

22. 3. Crossed Cheque: A cheque on
which two parallel lines are drawn
on its face. A crossed cheque can
not be cashed at bank counter.
Amount is transferred from bank
to bank.

24. 4. Open Cheque: When a cheque
is not croosed, it is said to be an
open cheque. A crossed cheque
can not be made an open cheque
without the signature of the
accountholder.

26. 5. Post dated Cheque: A cheque
that contains any future date or a
date yet to come is called post
dated cheque.

28. 6. Anti-dated Cheque: A cheque
that contains any previous date on
which it is drawn is called anti-dated
cheque.

30. 6. Stale Cheque: A cheque that
contains six month old date on
which it is drawn is called stale
cheque.

32. 6. Dishonoured Cheque: When a
cheque is returned by the banker
unpaid due to any reason is callled
a dishonoured cheque

33. Dishonouring of cheque
• Signatures are different
• amount in words and figures differ
• alterations are not signed
• insufficient funds in account
• payment is stopped by accountholder
• Stale cheque (6 mont hold date)
• etc

35. Important
Terms

36. Postal Order: It is a written
order by which one post
officer requests the other
post officer to pay a
specific amount of money
to a specific person.

37. Bank Draft: It is a written
order by which one Banker
requests the other banker
to pay a specific amount of
money to a specific
person.

38. Treasury Order: It is a
written order by the
Government department to
a particular “government
treasury” to pay a sum of
money to the person
whose name is written

39. Standing Order:
Sometimes, the banker
pays some expenses and
receives some incomes on
the behalf of the client.
This right of the bank is
called, standing order.