Itb Chap 17

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Itb Chap 17

  1. 1. Banking and Financial Services 17-1 Banks and Other Financial Institutions 17-2 Financial Services and Electronic Banking 17-3 Checks and Payment Methods 17
  2. 2. LESSON 17-1 Banks and Other Financial Institutions <ul><li>Goals </li></ul><ul><li>Explain the purpose of the Federal Reserve System. </li></ul><ul><li>List the types of financial institutions. </li></ul><ul><li>Discuss factors for selecting a financial institution. </li></ul>
  3. 3. Key Terms <ul><li>Federal Reserve System (Fed) </li></ul><ul><li>commercial bank </li></ul><ul><li>credit union </li></ul><ul><li>Federal Deposit Insurance Corporation (FDIC) </li></ul>
  4. 4. THE BANKING SYSTEM <ul><li>The Federal Reserve System (Fed) </li></ul><ul><li>Federal Reserve activities </li></ul><ul><li>Banking and the economy </li></ul>
  5. 5. >> C H E C K P O I N T <ul><li>What is the main purpose of the Federal Reserve System? </li></ul>
  6. 6. TYPES OF FINANCIAL INSTITUTIONS <ul><li>Deposit institutions </li></ul><ul><ul><li>Commercial banks </li></ul></ul><ul><ul><li>Savings and loan associations </li></ul></ul><ul><ul><li>Mutual savings banks </li></ul></ul><ul><ul><li>Credit unions </li></ul></ul>
  7. 7. TYPES OF FINANCIAL INSTITUTIONS <ul><li>Non-deposit financial institutions </li></ul><ul><ul><li>Life insurance companies </li></ul></ul><ul><ul><li>Investment companies </li></ul></ul><ul><ul><li>Consumer finance companies </li></ul></ul><ul><ul><li>Mortgage companies </li></ul></ul><ul><ul><li>Check-cashing outlets </li></ul></ul><ul><ul><li>Pawnshops </li></ul></ul>(continued)
  8. 8. >> C H E C K P O I N T <ul><li>What are some examples of non-deposit financial institutions? </li></ul>
  9. 9. SELECTING A FINANCIAL INSTITUTION <ul><li>Services offered </li></ul><ul><ul><li>Savings accounts </li></ul></ul><ul><ul><li>Checking and payment accounts </li></ul></ul><ul><ul><li>Loans and other credit plans </li></ul></ul><ul><ul><li>Other services, such as safe deposit boxes </li></ul></ul><ul><li>Safety </li></ul><ul><li>Convenience </li></ul><ul><li>Fees and charges </li></ul><ul><li>Restrictions </li></ul>
  10. 10. >> C H E C K P O I N T <ul><li>What factors should be considered when selecting a financial institution? </li></ul>
  11. 11. LESSON 17-2 Financial Services and Electronic Banking <ul><li>Goals </li></ul><ul><li>Identify the financial services used by consumers. </li></ul><ul><li>Explain types of checking accounts. </li></ul><ul><li>Describe electronic banking activities. </li></ul>
  12. 12. Key Terms <ul><li>safe-deposit box </li></ul><ul><li>service charge </li></ul><ul><li>debit card </li></ul>
  13. 13. TYPES OF FINANCIAL SERVICES <ul><li>Savings services </li></ul><ul><li>Payment services </li></ul><ul><li>Lending services </li></ul><ul><li>Electronic banking </li></ul><ul><li>Storage of valuables </li></ul><ul><li>Investment advice </li></ul><ul><li>Management of trusts </li></ul>
  14. 14. >> C H E C K P O I N T <ul><li>What are the main financial services used by consumers? </li></ul>
  15. 15. TYPES OF CHECKING ACCOUNTS <ul><li>Regular checking accounts </li></ul><ul><li>Interest-earning </li></ul><ul><li>Checking accounts </li></ul><ul><li>Special checking accounts </li></ul>
  16. 16. COMPARING CHECKING ACCOUNTS <ul><li>Minimum balance </li></ul><ul><li>Interest rate earned, if any </li></ul><ul><li>Monthly service charge </li></ul><ul><li>Fees for other services, such as printing checks and stop payment orders </li></ul><ul><li>Other restrictions </li></ul>
  17. 17. >> C H E C K P O I N T <ul><li>What are three main types of checking accounts? </li></ul>
  18. 18. ELECTRONIC BANKING <ul><li>E-banking services </li></ul><ul><ul><li>Automatic teller machines </li></ul></ul><ul><ul><li>Payments at the point-of-sale </li></ul></ul><ul><ul><li>Direct deposit </li></ul></ul><ul><ul><li>Automatic bill payments </li></ul></ul>
  19. 19. ELECTRONIC PAYMENT OPTIONS <ul><li>Debit card transactions </li></ul><ul><li>Online payments </li></ul><ul><li>Stored-value cards </li></ul><ul><li>Smart cards </li></ul>
  20. 20. BANKING IN THE FUTURE <ul><li>Financial services combined with wireless technology </li></ul><ul><li>Personalized systems for obtaining, transferring, and using funds </li></ul>
  21. 21. >> C H E C K P O I N T <ul><li>What are common electronic banking services? </li></ul>
  22. 22. LESSON 17-3 Checks and Payment Methods <ul><li>Goals </li></ul><ul><li>Describe three main types of endorsements. </li></ul><ul><li>Describe proper check-writing procedures. </li></ul><ul><li>Explain the bank reconciliation process. </li></ul><ul><li>Identify other payment methods. </li></ul>
  23. 23. Key Terms <ul><li>endorsement </li></ul><ul><li>check register </li></ul><ul><li>stop payment order </li></ul><ul><li>bank statement </li></ul><ul><li>bank reconciliation </li></ul><ul><li>outstanding checks </li></ul>
  24. 24. OPENING A CHECKING ACCOUNT <ul><li>Benefits of checking accounts </li></ul><ul><ul><li>Convenience and ease of making payments </li></ul></ul><ul><ul><li>Safety to make payments with less risk than using cash </li></ul></ul><ul><ul><li>Proof of payment </li></ul></ul><ul><ul><li>A record of finances for managing your money </li></ul></ul>
  25. 25. THE FIRST DEPOSIT <ul><li>Signature card </li></ul><ul><li>Joint account </li></ul><ul><li>Deposit slip </li></ul>
  26. 26. SIGNATURE CARD
  27. 27. TYPES OF ENDORSEMENTS <ul><li>Blank endorsement </li></ul><ul><li>Full endorsement </li></ul><ul><li>Restrictive endorsement </li></ul><ul><ul><li>Special endorsement </li></ul></ul><ul><ul><li>Two signatures required </li></ul></ul><ul><ul><li>Restrictive endorsement </li></ul></ul>
  28. 28. SAMPLE ENDORSEMENTS
  29. 29. >> C H E C K P O I N T <ul><li>What are the three types of endorsements? </li></ul>
  30. 30. USING A CHECKING ACCOUNT <ul><li>Check-writing procedures </li></ul><ul><ul><li>Elements of a check </li></ul></ul><ul><ul><li>The check register </li></ul></ul><ul><ul><li>Writing a check </li></ul></ul><ul><ul><li>Proper check writing </li></ul></ul><ul><li>Stopping payment </li></ul>
  31. 31. PARTS OF A CHECK
  32. 32. >> C H E C K P O I N T <ul><li>What is the purpose of a check register? </li></ul>
  33. 33. THE RECONCILIATION PROCESS <ul><li>Bank statement information </li></ul><ul><li>Determine checks paid </li></ul><ul><li>Find differences </li></ul><ul><li>Calculate adjusted balance </li></ul>
  34. 34. MONTHLY ACCOUNT STATEMENT
  35. 35. RECONCILIATION FORM
  36. 36. >> C H E C K P O I N T <ul><li>What are causes of differences between the bank statement balance and a person’s check register? </li></ul>
  37. 37. OTHER TYPES OF PAYMENTS <ul><li>Certified checks </li></ul><ul><li>Cashier’s checks </li></ul><ul><li>Traveler’s checks </li></ul><ul><li>Money orders </li></ul>
  38. 38. CERTIFIED CHECKS <ul><li>Personal check for which a bank has guaranteed payment </li></ul><ul><li>Certification stamped on face </li></ul><ul><li>Signed or initialed by a bank officer </li></ul>
  39. 39. CASHIER’S CHECKS <ul><li>Check that a bank draws on its own funds </li></ul><ul><li>Costs the amount of the check plus a service fee </li></ul><ul><li>More acceptable than the personal checks </li></ul>
  40. 40. TRAVELER’S CHECKS <ul><li>Special forms designed for making payments when away from home </li></ul><ul><li>Require your signature in two places </li></ul><ul><li>Cash a check or pay for a purchase </li></ul><ul><li>Commonly accepted throughout the world </li></ul>
  41. 41. MONEY ORDERS <ul><li>Form of payment that orders the issuing agency to pay the amount printed on the form to another party </li></ul><ul><li>A bank money order </li></ul><ul><li>A postal money order </li></ul><ul><li>An express money order </li></ul><ul><li>A telegraphic money order </li></ul>
  42. 42. >> C H E C K P O I N T <ul><li>How does a certified check differ from a cashier’s check? </li></ul>

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