professional banker certificate

current account
money transmission account. Most people have their salary directly paid into this account, and use this for routine transactions.
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savings account
usually used for holding medium- long term surpluses of funds, operated by a plastic card or a passbook. Interest is paid by the bank based on the amount of money in the account
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Individual Savings Account (ISA)
tax free savings account, can consist of cash or stocks and shares, maximum annual limits are set annually for the amount that can be paid in to an ISA (reviewed by the government) cash ISA- must be over 16, stocks and shares ISA- must be over 18.
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authorised overdraft
a set over draft limit (negative balance) pre-arranged with the bank and the customer. Usually banks will charge interest or a fee in return for making use of the overdraft.
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unauthorised overdraft
where the customer has not agreed an overdraft facility with their bank in advance and they withdraw more money than they have available in their account. Subject to expensive charges and fees.
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personal loan
used by personal customers to finance the purchase of major assets such as, car, holiday, home improvements etc.
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repayment mortgages (C+I)
requires borrower to repay part of the capital borrowed and an interest payment charged on that capital every time an instalment is made. The balance of the account should b £0 at the end of the term.
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interest only mortgages
there are no repayments of the capital during the life of the loan. Monthly payments are made to cover on the interest charged. Therefore borrowers must have a repayment vehicle in place to repay the lump sum of capital borrowed at the end of the ter
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current account mortgages
loan and current account are amalgamated in to one account. When each month’s salary is credited to the account, the total mortgage outstanding is reduced. The interest charged is therefore slightly lower.
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islamic mortgages
conforms to sharia law. do not charge interest.
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Ijara finance plan
the customer agrees the purchase price; the property is then purchased by the bank, who takes the legal title. The property is then sold to the customer at the original price with payment spread over an agreed term. the customer pays rent during this
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Murabaha plan
the customer agrees the purchase price then the property is purchased by the bank. On the day of this completion, it is immediately sold to the customer at a higher price determined by the value of the property and the number of years the bank allows
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equity release mortgages
the difference in value between the market value and the total value of the mortgage and other loans secured on the property. This enables the customer to borrow some proportion of this equity freeing up capital locked in the property.
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remortgage
- customer applies for a remortgage with another lender than the one they are with currently.
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second mortgage
customer takes out a second mortgage with a lender other than the one they are currently with, and ends up with 2 separate mortgages.
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lifetime mortgage
designed for people aged over 55. Most have no outstanding mortgage commitments; the mortgage has no expiry date but is repaid on death or when the property is sold. Borrowing is restricted however.
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home reversion plan
involves selling all or part of the property to the bank. The occupant then becomes a tenant for life or until the property is sold, it is not a loan.
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bridging loan
short term loan used to cover the period where a customer has to pay for a major purchase before receiving the proceeds from a major sale.
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mortgage market review
2014- makes lenders responsible for verifying income, stress testing and verifying repayable vehicles for interest only mortgages.
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credit cards
allow the customer to buy goods and pay for them at a later date. The customer receives a statement monthly from the company, and has the option to make a payment towards the balance. The minimum payment is 5% or £5 whichever is greater.
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household insurnace
need a mortgage to purchase provides insurance for the full reinstatement of the value of the property, to protect the value of the lenders security against the loan.
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payment protection insurance
when a customer takes out a loan, you can protect the repayment should the customer suffer sickness or an accident or become unemployed. It provides repayment of loans up to 2 years.
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income protection insurance
used to be permanent health insurance provides a replacement income in the event that the person cannot work due to illness. Critical illness cover is related to this, which provides for a cash sum to be paid if the person is diagnosed
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travel insurance
many take holiday abroad and travel insurance provides protection in the event that medical or other costs are incurred. Most provide against flight delays and cancellations, repatriation of serious injury.
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car insurance
third party liability car insurance is mandatory for drivers. Cover can be arranged at the following levels- third party only, third party fire and theft and comprehensive.
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stakeholder pension plan
involves capped charges, low minimum contributions and easy transfers, introduced by the government in order to encourage those in lower income groups to make some provision for retirement.
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auto-enrollment
employees are automatically enrolled into a qualifying pension by their employer, unless the worker opts-out.
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cheques
written instruction that where the drawer orders the bank to pay the payee the amount stated form a bank account.
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automated payments
payments arranged in advance that are used for regular payments from an account. Payments are removed automatically from persons account, once set up. eg. standing order/direct debits.
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faster payments
up to £250,000 can be sent per transaction, the transaction will reach the beneficiaries account quickly. Launched in 2008.
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crowd funding
way in which people, organisations and businesses can raise money through online portals to finance or re-finance their activities.
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loan based corwd funding platforms
enable people to lend money to individuals or businesses in the hope of financial return in the form of interest payments and a repayment of capital over time.
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investment based crowd funding platforms
enables people to invest in unlisted shares or debt securities issued by businesses.
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vulnerbale customer
someone who, due to their personal circumstances is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.
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comlpaints
a written or oral expression of dissatisfaction about a service the bank has provided or failed to provide
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financial ombudsman service
independent expert in settling complaints between consumers and businesses. Deals with complaints from customers against regulated firms at no cost.
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financial services compensation shceme
a scheme that protects customers by paying compensation when a bank gets into financial difficulties. The compensation limit is $75,000 per person, per claim.
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Other cards in this set

Card 2

Front

usually used for holding medium- long term surpluses of funds, operated by a plastic card or a passbook. Interest is paid by the bank based on the amount of money in the account

Back

savings account

Card 3

Front

tax free savings account, can consist of cash or stocks and shares, maximum annual limits are set annually for the amount that can be paid in to an ISA (reviewed by the government) cash ISA- must be over 16, stocks and shares ISA- must be over 18.

Back

Preview of the back of card 3

Card 4

Front

a set over draft limit (negative balance) pre-arranged with the bank and the customer. Usually banks will charge interest or a fee in return for making use of the overdraft.

Back

Preview of the back of card 4

Card 5

Front

where the customer has not agreed an overdraft facility with their bank in advance and they withdraw more money than they have available in their account. Subject to expensive charges and fees.

Back

Preview of the back of card 5
View more cards

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