03 Banking and Payments Free Online FlashCards

What is a checking account designed for?

A checking account is designed for frequent transactions such as receiving paychecks, making debit-card purchases, paying bills, and withdrawing cash.

What is the FDIC deposit-insurance limit for eligible deposits?

At an FDIC-insured bank, eligible deposits are insured up to $250,000 per depositor, per insured bank, per ownership category. This does not cover investments such as stocks or mutual funds.

How does a credit card differ from a debit card?

A debit card draws money from a linked deposit account. A credit card borrows from the card issuer and may involve interest if you carry a balance.

What is an ACH transfer?

An ACH transfer moves money electronically between bank or credit-union accounts. It may take time, can be returned for insufficient funds, and may have limits or fees.

How does automatic debit differ from bank bill pay?

Bank bill pay is a request for your bank or credit union to send a payment. With automatic debit, you authorize a company to withdraw payments from your account.

What determines whether a payment-app balance has deposit-insurance protection?

Deposit-insurance protection for money left in a payment app may depend on the app’s arrangements and your enrollment. Check whether the balance is protected.

Does a “free” bank account necessarily have no fees?

A “free” account may still charge fees. Review its fee schedule to see what the label includes and excludes.

When may a bank charge an overdraft fee for a one-time debit-card or ATM transaction?

A bank generally may not charge an overdraft fee for one-time debit-card and ATM transactions unless you opted in to overdraft coverage. Checks and recurring electronic payments may be treated differently.

What account terms should you compare before opening an account?

Compare the monthly fee and ways to avoid it, opening or minimum-balance requirements, ATM costs, overdraft and returned-payment fees, and transfer or withdrawal limits.

How can you reduce risk when signing in to digital banking?

Use the bank’s official app or type its known website address instead of following unexpected links in texts or emails. Use a unique password and turn on multifactor authentication where available.

What should you do after noticing an unauthorized transaction?

Contact the bank promptly using a trusted phone number or app, follow its instructions, and keep a record of your report. Protections and deadlines can depend on the transfer type and reporting time.

What is the main purpose of a savings account?

A savings account is generally used to set money aside. It may earn interest, and some accounts limit certain withdrawals or transfers.