Below are some definitions of some of the most common types of bank to help you understand the technical terms and differentiations.
High street Banks – most common high street banks are called retail and commercial banks as they provide banking services to both the general public (retail banking) and to businesses (commercial banking).
Building Societies – offer the same services as banks do, but a building society is owned by its members (the people who invest in the building society). This means that there are no shareholders to pay dividends to.
Credit Unions – these are also owned by their members, so they are non-profit organisations, however membership depends on having a “common bond”. For example: to be part of a specific credit union you may need to be living or working in a specific area, or belong to a certain trade union or housing association. For more information on credit unions, click here.
National Savings and Investments (NS&I) – provides government-supported savings and investment products. So any money you invest is completely secure. To find out more about NS&I – follow this link.
A good way of choosing which bank to save with is to consider how you would like to run your banking.
Follow this link to MoneyHelper for information of what to think about before you decide.
If you are worried about the security of your savings follow this link.
Banks, building societies, credit unions and other firms that accept deposits and provide banking products have to be authorised by and regulated by The Financial Conduct Authority (FCA). For more information follow this link.
The FCA have brought in new rules, known as the Consumer Duty, which set a higher standard of consumer protection in financial services. The Duty means you should get: the support you need, when you need it. communications you understand. products and services that meet your needs and offer fair value.
Further information on the Consumer Duty is available at the following links:
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