e-wisdom.com glossary

ATM

e-wisdom.com editors — Tue, 17 Nov 2009 16:58:44 +0000

Automated Teller Machines (ATMs) are provided to give customers access to a banking terminal when the bank is closed. ATMs are interconnected, making banking transactions possible while traveling. With a magnetically-encoded card (either a debit or ATM card), a customer can withdraw cash, make a deposit, or check an account balance at an ATM. A surcharge is usually posted on a customer’s account for use of an ATM. Fees can be charged by the customer’s bank and the bank-owned ATM, but some banks set up an alliance to waive the surcharge fees if the customer uses ATMs within a system of certain banks.

ATM Card Fee

e-wisdom.com editors — Tue, 17 Nov 2009 16:56:51 +0000

A bank may charge an annual or monthly fee for issuing an ATM card.

Automatic Transfer

e-wisdom.com editors — Tue, 17 Nov 2009 16:56:33 +0000

A customer may elect to set up a periodic transfer of funds from one account within the bank to another, at a specified date and amount.

Automatic Deposit

e-wisdom.com editors — Tue, 17 Nov 2009 16:56:16 +0000

An arrangement made with the customer’s employer or (other source of income) to deposit wages or funds into a designated bank account. Also called Direct Deposit.

Automatic Withdrawal

e-wisdom.com editors — Tue, 17 Nov 2009 16:56:01 +0000

With this service, also known as direct payment, the account holder can pay bills and set up other periodic transactions to ensure financial obligations will not be late due to neglect. After setting up an automatic withdrawal, the amount due is automatically deducted from the account on predetermined dates: monthly, quarterly or annually. It is up to the account holder to maintain adequate funds in the account and to keep track of the dates for automatic withdrawals in order to avoid overdraft fees and an inadequate account balance.

Bank Secrecy Act

e-wisdom.com editors — Tue, 17 Nov 2009 16:55:47 +0000

An act passed by the U.S. Congress in 1970 to prevent money laundering and monitor suspicious activity (e.g. tax evasion).

Cashier’s Check

e-wisdom.com editors — Tue, 17 Nov 2009 16:55:21 +0000

A check for situations that require more security than a personal check. A cashier’s check is issued by a bank or financial institution (even a grocery store) to the purchaser, who pays cash to that entity and sometimes a fee for the service. The check is then drawn upon the funds of the issuer, not the account of the person who purchased the cashier’s check. In recent years numerous scams have been run using fraudulent cashier’s checks.

Check Image

e-wisdom.com editors — Tue, 17 Nov 2009 16:54:56 +0000

An image (electronic or digital) of the front and back of a paper or “substitute” check. Check images are used in online banking websites for customers to view the details of cleared checks.

Digital Wallet

e-wisdom.com editors — Tue, 17 Nov 2009 16:54:41 +0000

A software program that stores personal information, such as bank and credit card account numbers and social security numbers in a secure, usually encrypted program on a client’s computer or electronic device. By storing the information in a digital wallet (or “e-wallet”), the user can enjoy safer, faster transactions online. Paypal is an example of a digital wallet.

Diversification

e-wisdom.com editors — Tue, 17 Nov 2009 16:54:19 +0000

A plan for financial investing that spreads the funds among a variety of investments to minimize risk and maximize return. If one of many small investments fails, the loss is minimal.