Banking and financial services chapter 17

Shareholders

Members of a credit union.

Direct deposit

The process by which funds are deposited electronically and available automatically for your use.

Electronic funds transfer (EFT)

The use of computers and other technology for banking activities, including the use of automated teller machines (ATM), point-of-sale transactions, direct deposit, and automatic bill payment.

Joint account

When two or more people have an account together.

Endorsement

Written evidence that a person received payment or transferred the right to receive payment to someone else.

substitute check

a digital reproduction pf the original paper check.

Signature card

a document used to verify your signature.

Automatic bill payment

A service by which a bank deducts a payment from your account and transfers the funds to the appropriate companies. This service requires a bank customer to authorize present amounts of monthly expenses.

Federal reserve system (Fed)

A system set up by the federal government to supervise and regulate member banks and to help banks serve the public efficiently. All national banks are required to join the Federal Reserve System, and state banks may join.

Point-of-sale transaction

A transaction in which a merchant accepts debit cards to pay for purchases.

Credit union

A user-owned, not-for-profit, cooperative financial institution.

Stop payment order

A written notice that tells the bank not to pay a certain check.

Blank endorsement

An endorsement of a check that consists of only the endorser'd name.

Full endorsement (Special endorsement)

An endorsement that allows you to transfer a check to another person.

Restrictive Endorsement

An endorsement that limits the use of the check to the purpose given in the endorsement.

Special checking account

Checking accounts for people who only write a few checks each month. Banks charge customers about 10 to 20 cents for each check written.

Outstanding checks

Checks that have not been deducted from the bank statement balance.

Certified check

A personal check which for which a bank has guaranteed payment.

Bank statement

A report on the status of a bank account.

Service charge

The fee a bank charges for handling a checking account.

Drawer

The owner of the account who signs the check.

Payee

The person whom the check is written.

Mutual savings bank

A saving bank that is owned by, and operated for the benefit of, its depositors.

Check register

A separate book form on which the depositor keeps a record of checking account activities.

Debit card

A bank issued card used for the ATM transactions.

Commercial bank

A bank that offers a full range of financial services.

Non-depository intermediaries

A category of financial institutions that does not take or hold deposits. They earn their money selling specific services or policies.

Cashier's check

A check that a bank draws on its own funds.

Postdated check

A check that is dated later than the date on which it is written

Share draft account

A checking account at a credit union.

Automatic teller machine

A computerized device that allows customers to make bank transactions including with drawing cash.

Safe-deposit box

A container for storage of valuables offered by banks

Depository institution

A financial institution that accepts deposits from individuals and businesses and uses the money to finance its business.

Check stub

A form attached to the check by a perforated line.

Express money order

A form issued by various organizations including traveler's check companies, travel agencies, and many super markets, pharmacies, and convenience stores.

Postal money order

A form of payment purchased from the U.S. post office that can be sent safely through mail.

Money order

A form of payment that orders the issuing agency to pay the amount printed on the form to another party.

Bank money order

A form sold by a bank stating that money is to be paid to a specific person or business.

Clearing

Paying of checks among different banks in different cities.

Smart cards

Plastic cards with silicon chips that are used to store information. The chip within the card stores such data as a cardholders current account balance, credit history, or medical information.

Traveler's check

Special forms designed for making payments when away from home.

Drawee

The bank or other financial institution that pays the check.

Bank reconciliation

The document created to show how your own record of your checking account and the bank's record of your account were brought into agreement.

Federal deposit insurance corporation (FDIC)

The federal agency that helps to regulate banks and other financial institutions.