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Basic Bank Account - Jargon Buster

Some key words and phrases explained to help you understand the world of banking.

Automated Credit Transfer (ACT)

Payment of wages, benefits pensions and tax credits directly into a bank or building society

Balance

The total amount of money in your account, or the amount you owe the bank if you overdraw.

Buffer –Zone

A small amount of credit/overdraft that a bank may give you.    So you can get money from a cash machine even if you don’t have enough money in your account.

Cash back

A service that allows you to get cash from your account in supermarkets or other shops, using your basic bank account debit card.

Cash card

A card you can use to check your balance or withdraw cash from your account at cash machines or post office branches.   You cannot use a cash card to pay for goods or services.

Chip and Pin

The name for using a personal identification number to authorise a payment  from your account.

Credit check

A search of your borrowing record, also known as your credit history.   A bank or other organisation carries out a credit check on a person when deciding whether to lend them money or to open a bank account in their name. 

Debit card

A card issued by a bank that you use to pay for your shopping. The money is usually taken from your account immediately.

Direct Debit

A way of paying bills directly from your bank account.  You sign a form allowing the company you are paying to take the money directly from your account on specific dates. They then take the money from your account automatically on the agreed dates.   They have to notify you in advance before changing the amount or the dates of the payment.

Interest

A charge for borrowing money or a reward for saving money. It is usually shown as a percentage of the amount borrowed or saved. 

Money Laundering

The process people go through to disguise and hide money made illegally.

Overdraft

A facility allowing you to spend more money from your account than you have in it.   The bank will usually charge you interest if this happens and sometimes other fees as well.

Standing Order

A way of paying bills from your bank account. You sign a form sent to you by the company you are paying. This sets out the amount to be paid and the payment dates, you then give this to your bank.

The bank pays the amounts from your account automatically on the agreed dates to the company you are paying. You must tell your bank if the amount or the dates of payment need to change.

Statement

A detailed list of all payments in and out of your account over a period of time, for example three months. Ask your bank how often it sends statements.

Contact Us

Rochdale Boroughwide Housing

Sandbrook House

Sandbrook Way,

Rochdale

OL11 1RY

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Tel:

0800 027 7769


Email:

|| rbh@rbh.org.uk ||