FORMAL FINANCIAL INSTITUTIONS: A company or organization that deals with financial transactions such as investments, loans and deposits. These are regulated by laws.

INFORMAL FINANCIAL INSTITUTIONS: Money lenders and saving schemes that operate on a community level. These function with greater flexibility in terms of interest rates and payment plans because they are not regulated by laws.

BANK LOAN: On successful application, a bank will grant a loan which must be paid back over a period of time with interest.

BANK STATEMENT: A financial record from the bank that shows the balance in your bank account and a record of your transactions on your account (and the charges involved) for a specific period of time.

BANK ACCOUNT: A financial facility made with a bank whereby one may deposit and withdraw money. It provides a safe place for your income to be paid into, a quick way to pay all your bills and a way to track all your expenses.

SAVINGS ACCOUNT: An easy to open bank account with minimal qualifying criteria offering you basic banking services in which people deposit money for savings purposes rather than day to day transactions. Depending on the terms and conditions, the money will earn low to moderate interest.

CHEQUE ACCOUNT: Sometimes referred to as a current or transactional account. This is a type of account with additional banking features in which the account owner’s money is deposited for immediate access. A minimum deposit or minimum salary is usually a qualifying criteria for this account. An overdraft or credit facility is often included and therefore counts towards your credit history.

TRANSMISSION ACCOUNT: An account that is a combination of a cheque account and a savings account. This is an account in which you can deposit and withdraw money at low interest rates and low bank fees but does not usually offer credit facilities.

TAX-FREE SAVINGS ACCOUNT: A tax-free savings account is an investment account that does not charge taxes on contributions, interest earned, dividends or capital gains and you can withdraw from it through the transactional account.

DEBIT ORDER: This is when you agree for a service provider to deduct money from your bank account to pay for goods and services every month.

STOP ORDER: An arrangement between your employer and your service provider with your permission to deduct money from your salary to pay for goods and services. It will appear on your pay slip.

FIXED DEBIT ORDER: A debit order that goes off your account on the same date every month.

FLEXIBLE DEBIT ORDER: A debit order that goes off your account when there are sufficient funds in the account.

BANK CHARGES: All charges and fees charged by a bank for services rendered such as administration, cash withdrawal, fund transfer, balance enquiries, statement, etc. These charges vary according to the account and the bank itself.