Banking in Britain

1. Commercial banks offer commercial services to a wide range of customers. Customers can open current accounts and deposit accounts. A current account is very popular. It pays no interest but it has other advantages.

2. Firstly, it enables people to keep their money in a safe place. Secondly, it allows them to withdraw* it at any time. Thirdly, it provides them with a cheque-book so that they do not have to carry a lot of cash.

3. To open a current account it is necessary to see the branch manager. He has to decide whether the applicant is likely* to keep the account in credit. A current account holder* can only overdraw with the manager’s permission. The manager will therefore want to meet the applicant to get the necessary background information. For example, he will want to know the applicant’s occupation and his place of work. He will also probably want a reference from his/her employer. If, after the interview, the manager is satisfied with the applicant he will approve the application, arrange for the applicant to be given a cheque-book and arrange for a monthly statement* to be sent to him/her.

4. A deposit account is another popular kind of account. It has advantages over a current account. First of all, it is easier to open than a current account. There is no need to see the manager. A customer only has to fill in a form and then deposit the minimum amount of money required by the bank. The customer is then given a pass book which he must bring to the bank every time he wishes to withdraw or deposit money. The pass book is the customer’s record of the account*.

5. Secondly, a deposit account earns interest for the customer*. The bank invests the money that the customer pays in and, in return*, the bank pays the customer interest. The rate of interest in the UK is not fixed but it is usually between 5-10%.

6. However, a deposit account has certain disadvantages too. In the UK the maximum a customer can withdraw in one day varies from bank to bank. Another disadvantage is that the customer receives no cheque-book and therefore he cannot pay bills so easily.