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Basic Banking Services - Activity 1
ACTIVITY 1
Why Do YouNeed a Bank?
Overview
• Purposes of banks• The differences between banks and
credit unions• Safety of financial institutions• Banks as money management tools• The Earned Income Tax Credit
1
SAFETY OF FINANCIAL INSTITUTIONS
COMMERCIAL BANKS CREDIT UNIONS
Slide 1 – Safety of Financial Institutions Lesson Reference: Basic Banking Services, Activity 1 – Overhead 3 2
ELECTRONIC BANK SERVICESOnline banking is the fastest growing
Internetactivity in the U.S.
Types of Services
•Bank Cards
•Automated Services
Protect Your Passwords!Slide 3 - Electronic Bank Services
Lesson Reference: Basic Banking Services, Activity 2 – Overhead 3 3
BANK CARD TYPES
Slide 4 - Bank Card Types Lesson Reference: Basic Banking Services, Activity 2 – Overhead 4
TYPE• Check Cards or
ATM/Debit Cards
•
Stored Value Cards
DESCRIPTION• Bank cards that allow for the
payment of goods and services to be subtracted directly from a bank deposit account.
• Can be used with merchants that take major credit cards—known as point of sale (POS) transactions.
• Bank cards with preset, limited value.
• Used to pay for goods and services.
• Alternative to cash.4
ELECTRONIC BANK SERVICES
• Direct Deposit
• Transfers between Accounts
• Transfers to a Third Party
• Online Banking
• Bank by Phone
• ATM
Slide 5 – Electronic Bank Services
Lesson Reference: Basic Banking Services, Activity 2 – Handout 3 5
REGULATION OF ELECTRONICBANKING SERVICES
Electronic Fund Transfer ActProtects consumers using any type of electronic banking from loss and protects their privacy.
Banks must:• Offer consumers a record or receipt for all
computer transactions.• Investigate errors and report to consumer within
ten days of error notification.
Customers are responsible to report any errors.Slide 6 - Regulation of Electronic Banking
Lesson Reference: Basic Banking Services, Activity 2 – Overhead 5 6
Slide 1 - Checking Account Terms Lesson Reference: Basic Banking Services, Activity 3 – Handout 1
CHECKING ACCOUNT TERMS
•Bank Statement•Cancelled Check•Check•Check Register/Ledger•Endorsement•Fee• Interest•Minimum Balance
•Outstanding Transactions
•Overdraft•Overdraft Protection•Payee•Reconciling a Bank
Statement•Transaction Limits
7
Slide 2 - Shopping Around Lesson Reference: Basic Banking Services, Activity 3 - Handout 2
SHOPPINGAROUND
(THINGS TO ASK ABOUT
WHENOPENING A CHECKING ACCOUNT)
SERVICESLocation of bankLocation of ATMsBanking hoursMinimum balance requiredMinimum transactions or limitsInterest-bearing accounts?Other
COSTSNon-primary bank ATM transactionsIn-branch transaction feesPer-check feesOther checking feesOverdraft protectionPrinting of checks
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Basic Banking Services - Activity 4
ACTIVITY 4
Opening a Checking Account
Overview
• Checking Account Application Process• The Application• Acceptable Forms of ID• The Signature Authorization Card• The PATRIOT Act
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Slide 1 – Opening a Checking Account
Lesson Reference: Basic Banking Services, Activity 4 – Handout 1
OPENING A CHECKING ACCOUNT
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Slide 2 - Commonly Accepted Forms of ID Lesson Reference: Basic Banking Services, Activity 4 – Handout 2
Primary ID*
•Photo Driver’s License issued
within the U.S. or Canada
•State Non-Driver Photo ID
•Photo Learner’s Permit
•Government Photo ID
•U.S. Passport
•Non-U.S. Passport
•Resident Registration Card
•Mexican Consular ID (Matricula Consular)
* Financial institutions' ID requirements may differ; check with the institution first before applying for an account.
COMMONLY ACCEPTED FORMS OF ID
•Naturalization Certificate
•Employee Photo ID (from a recognizable employer)
•Photo Trade License (barber, plumber, electrician, etc.)
•Student Photo ID (college/trade school)
•Medicare Card (must be 65 or older)
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Slide 3 - Commonly Accepted Forms of ID Lesson Reference: Basic Banking Services, Activity 4 – Handout 2
Secondary ID*
•Pay Stub
•Car Registration
•Mortgage Statement
•Letter of Introduction from Bank, Embassy, or well-known Employer
•Welfare Card
•Supplemental Health Insurance Card
* Financial institutions' ID requirements may differ; check with the institution first before applying for an account.
COMMONLY ACCEPTED FORMS OF ID
•Foreign Driver’s License
•State/Local Gun Permit
•Utility Bill (Name and address
of individual account should be listed)
•Current Bank Statement
•National Credit Card
•Bank-issued Debit or Check Card
12
THE PATRIOT ACT
Congress passed the PATRIOT Act in response to the terrorist attacks of September 11, 2001. Financial institutions are now required to collect certain information when a new account is opened.
Slide 4 – The PATRIOT Act
Lesson Reference: Basic Banking Services, Activity 4 – Overhead 1
1. The customer must provide identification that includes name, date of birth, address, and identification number.
2. The institution must maintain a copy of the information used to verify the person’s identity.
3. The institution must determine whether the applicant appears on the lists of known or suspected terrorists or terrorist organizations.
13
Slide 5 – Signature Authorization Card
Lesson Reference: Basic Banking Services, Activity 4 – Handout 3
SIGNATURE AUTHORIZATION CARD
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Basic Banking Services - Activity 5
ACTIVITY 5
How to Write a Check
15
Slide 1 - Writing a Check Lesson Reference: Basic Banking Services, Activity 5 – Handout 1
WRITING A CHECK
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Basic Banking Services - Activity 6
ACTIVITY 6
Maintaining aChecking Account
Overview
• Check 21• Keeping a check register• Making a deposit into a checking account• Reconciling a bank statement• Maintaining a checking account• Avoiding Overdrafts
17
Slide 1 – Check 21
Lesson Reference: Basic Banking Services, Activity 6 – Handout 1
CHECK 21
Check 21 is a federal law that helps banks handle more checks electronically and that makes check processing faster and more efficient.
Under this law, a check deposited in a bank is typically “delivered” overnight to the paying bank and deducted from the checkwriter’s account on the next business day.
Money may be deducted from your checking account almost immediately.
18
KEEPING A CHECK REGISTER
Slide 2 - Keeping a Check Register Lesson Reference: Basic Banking Services, Activity 6 – Handout 219
Slide 3 - Making a Deposit - Endorsing a Check
Lesson Reference: Basic Banking Services, Activity 6 – Handout 2
MAKING A DEPOSIT - ENDORSING A CHECK
Restrictive Endorsement(most secure)
Blank Endorsement(least secure)
Endorsement to a third party
The Back Side of a Check
20
Slide 4 - Making a Deposit - Completing a Deposit Slip Lesson Reference: Basic Banking Services, Activity 6 – Handout 2
MAKING A DEPOSIT - COMPLETING A DEPOSIT
SLIP
21
Slide 5 - Reconciling a Bank Statement Lesson Reference: Basic Banking Services, Activity 6 – Handout 2
RECONCILING A BANK STATEMENT
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OVERDRAFTS AND BOUNCED CHECKS
Overdrafts and bounced checks occur when you complete a financial transaction (e.g., write a check) for more than what is available in the account. Your financial institution may pay the amount and charge you a fee, known as an “overdraft fee” or a “nonsufficient funds fee.”
Tip: Avoid overdraft or non-sufficient funds fees by making a habit of monitoring the balance in your checking account.
Slide 6 – Overdrafts and Bounced Checks Lesson Reference: Basic Banking Services, Activity 6 – Overhead 1 23
Basic Banking Services - Activity 7
ACTIVITY 7
The ABCs of aSavings Account
Overview
• Purpose of a savings account• Shopping for a savings account• Applying for a savings account• Monthly bank statement checkup
24
REASONS TO SAVE
• Emergencies
• Future Purchases
• Future Investments
Slide 1 - Reasons to Save Lesson Reference: Basic Banking Services, Activity 7 – Overhead 125
SHOPPING FOR A SAVINGS ACCOUNT
Factors to consider:• Safety• Risk• Liquidity• Minimum Account Balance Requirements• Fees and Service Charges• Interest Rate • Returns (Earnings)• Automatic Transfer• Direct Deposit
Slide 2 - Shopping for a Savings Account Lesson Reference: Basic Banking Services, Activity 7 – Overhead 226
OPENING A SAVINGS ACCOUNT
Slide 3 – Opening a Savings Account Lesson Reference: Basic Banking Services, Activity 7 – Overhead 327
Slide 4 – Bank Statement Lesson Reference: Basic Banking Services, Activity 7 – Overhead 4
BANK STATEMENT
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