50 Most Important Banking Abbreviations
Here we give the bank and essential 50 most Important banking abbreviations for the benefit of your study for the banking examinations.
What is a Bank?
A bank is a legal institution that accepts deposits on demand that can be withdrawn. Banks are institutions that assist the public in handling their finances, publicly depositing their funds in banks, ensuring that they withdraw money from deposits.
Banks also accept deposits from the general public and the business sector and provide depositors with two protections.
i. Deposit Protection
ii. Cancellation of deposit
Banks offer interest on deposits that add to the initial deposit sum and provide the depositor with a great opportunity. It encourages saving trends among the public.
The bank also grants loans based on deposits that contribute to the country’s economic growth and the well-being of the general public. With this stature, it becomes necessary to understand a bank’s major functions.
The bank has a lot of essential functions; mainly there are two types, secondary functions, and acceptance of deposits.
Mobilizing public funds, offering secure custody of savings and interest on savings to depositors is a very simple but essential feature of all commercial banks. The bank accepts various forms of public deposits.
Savings and deposits: Promotes public saving practices. For salary and wage earners, it is suitable. Interest rates are poor. The number and quantity of withdrawals are not limited. The deposit saving account may be opened in the form of a single name or a generic name. Depositors only need to maintain a minimum balance that differs from one bank to another. ATM cum debit card, cheque book, and Internet banking service are also issued by the bank.
Fixed Deposits: Sometimes referred to as Term Deposits, it is done for a fixed tenure, money would be deposited and no cash withdrawal during this time is permitted. In the event that depositors withdraw before maturity, banks levy an early withdrawal tax. Since a lump-sum amount is charged for a particular period at one time, the interest rate is high but varies with the deposit period.
Current Deposits: Entrepreneurs open them up. On that account, the account holders get an overdraft facility. In order to meet immediate needs, these deposits serve as a short-term loan. In order to keep a fund for unknown demands for the overdraft, the bank charges a high interest rate along with the overdraft facility charges.
Recurring deposits: At regular intervals, a certain amount of money is deposited in the bank. It is only after the expiry of a certain time that money can be withdrawn. For recurring deposits, a higher interest rate is charged as it offers a gain of a cumulative interest rate which helps depositors to collect a significant amount of money. This form of account is run by small traders and salaried individuals.
The subject ‘Functions of the Bank’ forms an important part of the question paper in competitive examinations and its information is vital to score good marks. In particular, in the report or at the time of the interview, candidates appearing for different bank exams such as the IBPS Exam, SBI Exam or RBI Exam undoubtedly encounter questions related to significant banking functions.
The questions related to bank functions are posed under the technical information heading for other graduate-level government exams such as the SSC test. This blog will therefore guide you through essential banking roles, their classifications, and more.
We at Takshila learning train and guide you properly for the roles in a banking community. Here we give the essential banking abbreviations for the benefit of your study for the banking examinations.
- ALM- Asset Liability Management
- KYC- Know Your Customer
- EXIM Bank- Export and Import Bank of India
- NABARD- National Bank for Agriculture and Rural Development
- SIDBI- Small Industries Development Bank of India
- NBFC- Non Banking Financial Companies
- RBI- Reserve Bank of India
- RIDF- Rural Infrastructure Development Fund
- RRB- Regional Rural Bank
- RTGS- Real Time Gross Settlement
- SCB- Scheduled Commercial Bank
- NRE Account- Non Resident External Account
- NRI Account- Non Resident Indian Account
- SDR- Special Drawing Rights
- ANBC- Adjusted Net Bank Credit
- DRI- Differential Rate Of Interest
- NPV- Net Present Value
- OMO- Open Market Operations
- LIC- Life Insurance Corporation of India
- IEPF- Investors Education and Protection Fund
- IRDA- Insurance Regulatory and Development Authority
- CCIL- Clearing Corporation of India Limited
- OTCEI- Over the Counter Exchange Of India
- KCC- Kisan Credit Card
- BCSBI- Banking Codes and Standards Board of India
- SEBI- Securities and Exchange Board of India
- SHG- Self Help Group
- CAR- Capital Adequacy Ratio
- MICR- Magnetic Ink Character Recognition
- NSE- National Stock Exchange
- MIS- Management Information System
- CRISIL- Credit Rating Information Services Of India
- ICRA- Investment Information and Credit Rating Agency
- CARE- Credit Analysis and Research Limited
- CASA- Current and Savings Accounts
- CIBIL- Credit Information Bureau of India Limited
- CRR- Cash Reserve Ratio
- KYC- Know Your Customer
- IPO- Initial Public Offer
- SLR- Statutory Liquidity Ratio
- EMI- Equated Monthly Instalments
- UTI- Unit Trust of India
- WPI- Wholesale Price Index
- EDI- Electronic Data Interchange
- EPS- Earning per Share
- ESOP- Employee Stock Options
- PIN- Personal Identification Number
- NEFT- National Electronic Fund Transfer
- NPA- Non Performing Assets
- BOE- Bill of Exchange
Download Banking Abbreviations PDF
Banking Abbreviations is one of the most important topics in the General Awareness section of banking exams. Apart from it, you can also expect questions from this portion in PO / SO interviews. We at Takshila Learning provide you with a list of the 50 most important commonly asked Banking Abbreviations and also all the other essentials regarding the Banking exam.
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