1. Banking and Financial Services17
Banking and Financial Services
17-1 Banks and Other Financial Institutions
17-2 Financial Services and Electronic Banking
17-3 Checks and Payment Methods

2. LESSON 17-1 Banks and Other Financial Institutions
Goals
Explain the purpose of the Federal Reserve System.
List the types of financial institutions.
Discuss factors for selecting a financial institution.
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3. Key Terms Federal Reserve System (Fed) commercial bank credit union
Federal Deposit Insurance Corporation (FDIC)
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4. THE BANKING SYSTEM The Federal Reserve System (Fed)
Main purpose is to supervise and regulate member banks and to help banks serve the public efficiently
All national banks are required to join – becoming member banks.
United States divided into 12 districts with a central Federal Reserve Bank in each district.
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6. THE BANKING SYSTEM Federal Reserve activities Supervise banks
Holding of reserves – banks are required to keep a part of the money they receive from customers on deposit in case the banks need additional funds to meet the daily customer demand
As a clearinghouse
Uses electronic funds transfer (EFT) to pay checks among different banks in different cities
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7. THE BANKING SYSTEM Banking and the Economy
The savings you and others deposit make banking services possible. Deposits do not remain idle in the bank, they are put to work.
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8. Some of the activities for which banking services are used include:
Building homes
Starting new businesses
Planting crops
Financing educations
Buying goods
Paving streets
Investing for retirement
Building hospitals
These activities create jobs and economic growth.
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9. TYPES OF FINANCIAL INSTITUTIONS
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10. Deposit Institutions Commercial banks Most common bank organization
Also known as full-service bank because they offer services such as:
Checking accounts
Savings accounts
Loans to businesses and individuals
May find branches in shopping centers and grocery stores
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11. Deposit Institutions Savings and loan associations
Traditionally specialized in savings accounts and making loans for home mortgages
Recently have expanded to offer a wider variety of services
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12. Deposit Institutions Mutual savings banks
A savings bank that is owned by, and operated for the benefit of, its depositors.
Profits are distributed in proportion to the amount of business each participant does with the company.
Organized mainly for savings and home loans.
Located mainly in the northeastern United States.
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13. Deposit Institutions Credit unions
User-owned, not-for-profit, cooperative financial institution
Comprised of people in the same company, government agency, or profession
Accept savings deposits and make loans
Regulated by NCUA, the National Credit Union Administration
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14. TYPES OF FINANCIAL INSTITUTIONS
(continued)
Non-deposit financial institutions
Life insurance companies
Investment companies
Consumer finance companies
Mortgage companies
Check-cashing outlets
Pawnshops
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15. >> C H E C K P O I N T
What are some examples of non-deposit financial institutions?
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16. SELECTING A FINANCIAL INSTITUTION
Services offered
Savings accounts
Checking and payment accounts
Loans and other credit plans
Other services, such as safe deposit boxes
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17. SELECTING A FINANCIAL INSTITUTION
Safety
Federal Deposit Insurance Corporation (FDIC) helps to regulate banks and protects depositors’ money in case of the failure of a bank
Insures all accounts in the same name at each bank up to an amount of $100,000 (temporarily increased by the government to $250,000 per depositor through December 31, 2009)
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18. SELECTING A FINANCIAL INSTITUTION
Convenience
24-hour banking
Branch offices in convenient locations
ATMs in convenient locations
On-line banking
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19. SELECTING A FINANCIAL INSTITUTION
Fees and charges
Compare your needs with the price you pay
Watch for hidden fees such as ATM fees
Restrictions
Minimum deposit requirements
Amount
Time
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20. >> C H E C K P O I N T
What factors should be considered when selecting a financial institution?
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21. LESSON 17-2 Financial Services and Electronic Banking
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4/19/2017
LESSON 17-2 Financial Services and Electronic Banking
Goals
Identify the financial services used by consumers.
Explain types of checking accounts.
Describe electronic banking activities.
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22. Key Terms
safe-deposit box
service charge
debit card
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23. TYPES OF FINANCIAL SERVICES
Savings services
Payment services
Lending services
Electronic banking
Storage of valuables
Investment advice
Management of trusts
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24. >> C H E C K P O I N T
What are the main financial services used by consumers?
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25. TYPES OF CHECKING ACCOUNTS
Regular checking accounts
Interest-earning
Checking accounts
Special checking accounts
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26. COMPARING CHECKING ACCOUNTS
Minimum balance
Interest rate earned, if any
Monthly service charge
Fees for other services, such as printing checks and stop payment orders
Other restrictions
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27. >> C H E C K P O I N T
What are three main types of checking accounts?
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28. ELECTRONIC BANKING E-banking services Automatic teller machines
Payments at the point-of-sale
Direct deposit
Automatic bill payments
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29. ELECTRONIC PAYMENT OPTIONS
Debit card transactions
Online payments
Stored-value cards
Smart cards
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30. BANKING IN THE FUTURE
Financial services combined with wireless technology
Personalized systems for obtaining, transferring, and using funds
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31. >> C H E C K P O I N T
What are common electronic banking services?
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32. LESSON 17-3 Checks and Payment Methods
Goals
Describe three main types of endorsements.
Describe proper check-writing procedures.
Explain the bank reconciliation process.
Identify other payment methods.
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33. Key Terms endorsement check register stop payment order bank statement
bank reconciliation
outstanding checks
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34. OPENING A CHECKING ACCOUNT
Benefits of checking accounts
Convenience and ease of making payments
Safety to make payments with less risk than using cash
Proof of payment
A record of finances for managing your money
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35. THE FIRST DEPOSIT
Signature card
Joint account
Deposit slip
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36. SIGNATURE CARD
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37. TYPES OF ENDORSEMENTS Blank endorsement Full endorsement
Restrictive endorsement
Special endorsement
Two signatures required
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38. SAMPLE ENDORSEMENTS
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39. >> C H E C K P O I N T What are the three types of endorsements?
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40. USING A CHECKING ACCOUNT
Check-writing procedures
Elements of a check
The check register
Writing a check
Proper check writing
Stopping payment
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41. PARTS OF A CHECK
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42. >> C H E C K P O I N T What is the purpose of a check register?
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43. THE RECONCILIATION PROCESS
Bank statement information
Determine checks paid
Find differences
Calculate adjusted balance
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44. MONTHLY ACCOUNT STATEMENT
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45. RECONCILIATION FORM
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46. >> C H E C K P O I N T
What are causes of differences between the bank statement balance and a person’s check register?
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47. OTHER TYPES OF PAYMENTS
Certified checks
Cashier’s checks
Traveler’s checks
Money orders
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48. CERTIFIED CHECKS
Personal check for which a bank has guaranteed payment
Certification stamped on face
Signed or initialed by a bank officer
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49. CASHIER’S CHECKS Check that a bank draws on its own funds
Costs the amount of the check plus a service fee
More acceptable than the personal checks
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50. TRAVELER’S CHECKS
Special forms designed for making payments when away from home
Require your signature in two places
Cash a check or pay for a purchase
Commonly accepted throughout the world
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51. MONEY ORDERS
Form of payment that orders the issuing agency to pay the amount printed on the form to another party
A bank money order
A postal money order
An express money order
A telegraphic money order
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52. >> C H E C K P O I N T
How does a certified check differ from a cashier’s check?
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