Financial Instituions

Personal Finance

Depository Institutions

Commercial Banks- For‐profit depository businesses that offer financial services to both consumers and other businesses. Banks are usually the largest depository institutions and offer the widest variety of services to customers.

Credit Unions- Are owned by their customers, who are usually called members. A credit union has membership qualifications that require its members share a common bond such as the same employer, the geographic area in which they live or membership in an organization and are non‐profit organizations exempt from federal income tax. This feature often allows them to pay higher interest rates on deposits, charge lower interest rates on loans and charge lower fees, compared to banks and other depository institutions.

Location Is Important

Access to the depository institution can depend on the physical location. Urgent or quick access to a depository institution, are things you may need to take this into consideration when choosing a depository institution that best fits your financial needs.


One of the most important services that a depository institution offers is a safe and secure place to deposit your money for future use.

Federal Deposit Insurance Corporation (FDIC)- Insurances banks and other types of institutions other than credit unions. $250,000 per depositor, per insured institution, for each account ownership type.

National Credit Union Administration (NCUA)- Insures credit unions. $250,000 per depositor, per insured institution, for each account ownership type.

(Not all depository institutions are covered by the FDIC or NCUA, so you should check for coverage before depositing any money.)

Transaction and Savings Tools

Depository institutions provide services that allow you to use your money without having to handle cash.

Interest- The price paid for using someone else's money. If you deposit money in an interest‐earning savings tool account you will be paid interest during the time the institution holds your funds and uses it for its own purposes. Eventually, you’ll see your initial deposit grow over time as it accrues interest paid by that institution.

Checking Accounts- Allows you quick access to funds for transactions. Use the money through paper checks, debit cards or withdrawing cash directly from your checking account. Checking accounts at credit unions are known as share draft accounts.

Savings Accounts- Generally for money that you don't intend to use for daily expenses. Your savings account will earn interest on its balance and be stored in a secure location. Savings accounts at credit unions are sometimes referred to as a share account and are required for membership.

Other Services:

Credit- Credit products allow you to borrow money from the financial institution in exchange for your promise to repay those funds in the future. By agreeing to these terms you will agree to pay the depository institution back the money borrowed plus interest.

Financial Advice- Information, advice, and assistance regarding a wide range of financial‐ related topics including investments and estate planning.

Safe-Deposit Box- Store valuable personal items.

Special Needs Payment Instruments- Traveler’s checks, certified checks, cashier’s checks and money orders.

Additional Features

Online Banking- Complete certain transactions from a secure internet site with a username and password. Enables you to access account info. any place, transfer money, pay bills and apply for credit.

Mobile Banking- Apps allow online banking access from any mobile device.

Debit Cards- A plastic card is electronically connected to the cardholder's depository institution account. Faster and more portable than checks and uses a Personal Identification Number or signature to authorize a transaction.

Automated Teller Machines (ATMs)- A machine that allows individuals to complete certain transactions from the machine. Enables you to withdraw and deposit money, transfer money, and check account balance. Accessed via an ATM card (usually a debit card and pin)

Contactless Payment- Transactions completed with no physical connection between the payment device and the Point of Scale (POS) device or store clerk. you "wave" a card in front of a sensor for a fast and easy transaction. Not all merchants have this technology.


Depository institutions often charge fees for certain services. Fee levels are important to consider when choosing a depository institution for your accounts.

Overdraft fee- A fee charged if you withdraw more money from your account than is available. Some depository institutions offer overdraft protection that helps you avoid overdraft fees if you exceed your account balance.

ATM fees- – Your depository institution may charge you for using an ATM that belongs to another depository institution.

Minimum balance fees- Some accounts require a minimum account balance. If you go below that balance you will be charged a fee.

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