Frequently Asked Questions

• How does banking work?

  Banks are a very important part of the economy because they provide vital services for both consumers and businesses. Banks provide a secur🐓e way to store, protect and provide access to customer deposits. Consumers can conduct routine𓂃 banking transactions through checking accounts, ATMs and electronic transfers while earning interest on their deposits held in deposit accounts like savings, certificates of deposits and in certain demand deposit accounts.

  Learn More: Bank Definition: How Does Banking Work?
• What is the history of deposit insurance?

  The federal government began offering insurance on bank deposits in March 1933 through the creation of the Federal Deposit Insurance Corporation (FDIC) after more than 9,000 banks failed as a result of the great depression. The FDIC is an independent agency that 🐻was createdꦫ to boost confidence in the health and well-being of the national financial system and currently offers $250,000 of coverage per customer, per account.

  Learn More: The History of the FDIC
• Are big banks a safer option for deposits?

  Larger banks can provide relatively more financial stability compared to smaller financial institutions like state and community banks and other financial institutions. While the U.S. banking system is very strong, including at the state and community level, larger banks are usually nat❀ionally chartered commercial banks that are guaranteed to provide FDIC insurance on deposits and are less likely to default on their obligations due to federally mandated capital reserve requirements.

  Learn More: Reasons Why Big Banks May Be a Wise Option
• What is a national bank?

  A national bank is a commercial bank that is chartered by the U.S. Comptroller of the Currency and functions as a member bank of the Federal Reserve, as well as being an investing member of its district Federal Reserve Bank. National banks are required to be members of the Federal Deposit Insurance Corporation (FDIC) and provide deposit insurance🐓 coverage to their customers.

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• What are bank fees?

  Bank fees are charges levied by banks and other financ☂ial institutions on their personal and business customers for things like account set-up, maintenance, and transactional services✨. Other examples of bank fees are wire transfer fees, automated teller machine (ATM) fees, non-sufficient fund (NSF) fees, and late payment charges.

  Learn More: Bank Fees Definition