CH 3: RETAIL BANKING

Retail banking

Retail banking, also known as consumer banking, is the typical mass-market banking in which individual customers use local branches of larger commercial banks. Banking services which are regarded as retail include provision of savings and transactional accounts, mortgages, personal loans, house loans, vehicle loabs, debit cards, and credit cards.commercial_bank

Retail banking is quite broad in nature. It refers to commercial banks dealing with individual customers, having fixed, current/savings accounts on liability side and personal loans, auto loans, education loans etc., on assets side. The loan values of under retail lending normally range between Rs. 20000 to Rs. 100 lakh and duration is generally 5 to 7 years except for housing loans.

Retail Products

Deposit:

  • Savings bank account
  • RD Account
  • Current account
  • TD account
  • BSBDA 
  • No Frill Accounts etc.,

Loans:

  • Home Loans
  • Auto Loans
  • Personal Loans
  • Consumer Loans
  • Educational Loans
  • Credit Cards
  • Crop Loans

Retail Services:

  • Safe deposit lockers
  • Depository services
  • Bancassurance products

The defaults in respect of retail advances was low when compared to overall bank loans and advances. Within the retail segment, the housing loans had the least gross asset impairment (default).

References:

  • “Principles & Practices of Banking”, Tata McGraw-Hill, New Delhi.
  • Investopedia and wikipedia.

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