Retail banking is the one dedicated to establishing operations with savers and private and small and medium-sized investors .
Retail, commercial or retail banking is perhaps the best known bank in society, as it is the most expanded and known among citizens. In general, retail banking carries out basic financing and savings collection operations, although in recent years it has undergone a major conversion until offering all kinds of complex products to the entire population.
We can divide retail banking into:
- Private banking: financial advice, investment funds, etc.
- Retail banking: Accounts sight , deposits , receipts and payroll, mortgages, loans, etc.
In addition to the above, retail banking has introduced in recent years a progressive channeling of wholesale or corporate banking products so that small savers could access these products: such as investment products, bonds, corporate debt, mortgage bonds, loans … with which to improve their profitability and also be able to obtain financing from a market that until then was banned by its low volume of assets.
In the most recent era, commercial banks that operate electronically within an online framework have proliferated . This has happened thanks to the development of electronic banking and the rapid extension of Internet networks in all corners of the world.
The evolution of retail banking
Initially, retail banking was dedicated to receiving money from agents with economic surplus (people or small institutions) in exchange for paying interest, to lend it with interest to other agents with financial needs. At the bank, he tried to capture savers with basic products such as deposits, while his financing operations went through consumer loans, mortgages and business financing, through savings accounts and payment of receipts.
Over time, these savings and financing products have taken a more complex position,dedicating products that were usually offered to large assets and capitals to small and medium-sized savers and SMEs.
Generally, retail banking has been available to consumers through bank offices and branches, through which intermediation occurred, however, with the expansion and technification of new technologies, online banking has led to a revolution in the access and immediacy of the consumers towards their products , and in a substitution of the physical place in the transactions towards telematic means.