Know the facts

Part of: Finance World

Know the facts: Building societies and banks

Building societies and banks offer a huge range of financial services including accounts (e.g. current, savings and business), loans, mortgages, insurance, investments, credit and debit cards, overdrafts and foreign currency exchange. Some of these services are also offered by other organisations such as the Post Office and some supermarkets. One of the services that most people will have is a building society or bank account.

An account:

  • keeps money safe (so it won't get stolen or lost).
  • lets you get your money out when you need it (from branches or cash machines).
  • can pay your usual bills regularly.
  • lets you pay for things over the phone, on the internet, or in person.
  • lets you manage your money by keeping track of everything.
  • can sometimes lend you money (but it has to be paid back).
  • can give 'interest' on savings, therefore making your money grow.
  • can be one of many different types, with different terms and conditions (e.g. instant access to your money).
  • can offer different types and levels of interest rate, so savers should look for high interest rates to earn as much interest as they can.

Some of the services offered by an account include:

  • a chequebook (for you to write out cheques).
  • a cheque guarantee card (this gives you cash up to an agreed amount and is a safeguard for the cheque).
  • a cash card (allowing you to get cash 24 hours a day from a cash machine).
  • a direct debit facility (for paying bills automatically).
  • a standing order facility (for paying any regular bills).
  • monthly statements (telling you all the transactions you've made on your account).
  • overdraft facilities (allowing you to borrow more money than you have in your account).
  • telephone and online banking (so you don't have to personally go into the building society or bank, but can carry out transactions by phone or computer).