A capital buffer is a portion of a bank’s capital that is in excess of the amount required by regulators. The buffer is designed to provide a cushion against losses and help ensure the stability of the financial system. Banks are required to maintain a certain level of capital, which is the money that the … Read more
The phrase “belt and suspenders” is a metaphor meaning “a backup plan.” It is derived from the literal meaning of the phrase, which is derived from the fact that belts and suspenders are both used to keep pants from falling down. The phrase is often used in the context of investing, to describe a situation … Read more
What is a remittance and how can you send one? What does remittance mean in simple words? Remittance is a term used to describe the sending of money from one person to another, usually via a bank or other financial institution. The person sending the money is known as the remitter, and the person receiving … Read more
What is a bank run? A bank run is when panicking customers withdraw all their money from a bank, due to fears that the bank will collapse. This can cause the bank to actually collapse, as happened during the Great Depression. When was the run on the banks? The run on the banks was during … Read more
A back-to-back letter of credit is a type of letter of credit in which two banks agree to provide financing for each other’s clients. This type of arrangement is often used when one bank does not have a branch in the country where the other bank’s client is located. Under a back-to-back letter of credit … Read more
Microfinance: Benefits, History, and How It Works What is the meaning of Micro Finance Bank? Micro finance banks are institutions that provide financial services to low-income individuals or groups who are not served by traditional banks. Micro finance banks offer a wide range of services including savings accounts, loans, insurance, money transfers, and other financial … Read more
. Compound interest: calculations and examples. What is compounding of interest explain with examples? Compound interest is when the interest you earn on an investment is added to your principal, so that the next time interest is paid, it’s paid on a larger sum of money. For example, let’s say you invest $1,000 at a … Read more
This can be a convenient way to manage your finances, but there are some things you should know before you use this type of banking.. What You Should Know About Lockbox Banking What is the benefit of a lockbox? A lockbox is a service offered by banks to businesses. It is a physical box located … Read more
A Federal Credit Union, or FCU, is a credit union that is chartered by the federal government. In the United States, there are two types of credit unions: federal credit unions and state credit unions. All credit unions in the US are regulated by the National Credit Union Administration (NCUA). FCUs are not-for-profit financial cooperatives … Read more
An account hold is when a bank or other financial institution places a hold on an account, which restricts the account holder’s access to funds. This is usually done when there are concerns about the account holder’s ability to meet their financial obligations, or if there is suspicious activity on the account. Why is there … Read more
