Basics of Banking

Correspondent | Tuesday May 23, 2023 06:00

Customers should make it a habit to scrutinise and understand their bank statements when they receive them on a monthly basis. Bank statements are usually sent at the end of the month outlining crucial information such as service fees, cash deposit fees, cash handling fees, monthly account fees, transfers, as well as the opening and closing balance.

First National Bank Botswana (FNBB), being a financial institution that embraces digitisation and is constantly advancing with time, made it a point to relay bank statements via e-mail, on the website as well as on the FNB App.

It is vital to thoroughly read bank statements in order to be up to date with all transactions transpiring in one’s account. Doing so helps an account holder to validate all the information listed.

Reading bank statements can help customers in many ways such as:  Fraud detection Scammers and fraudsters are gradually advancing their operations and would do anything in their power to swindle people of their hard-earned money. By reading one’s bank statement, irregular activity in the account may be noticed which could imply a possibility of fraud.

FNBB customers should not hesitate to inform the bank should they detect unusual activity upon reading their statements. Customers are also able to detect and protect themselves by reporting any suspected fraudulent activity on the FNB App.  Notification of failed payments Through a bank statement, one is able to see payments that were unsuccessful. Some payments can fail to go through and remain pending. It is via such statements that one gets to be aware of such.  Future planning and financial management A bank statement creates more awareness about a customer’s banking activity as it clearly states all payments, deductions and deposits for a particular month.

This information can help an account holder to improve their money habits, e.g., a customer may resolve to start spending wisely if ever they realise a huge difference between their opening and closing balance. Fees It is important to be knowledgeable of fees and how they differ when using digital platforms versus in branch. Knowing this information can help you decide which option is more affordable to you. Customers are encouraged to familiarise themselves with the pricing guide that is readily available on the FNB website.

Saving tips Saving is a cumulative process that requires discipline. The little you save can ultimately accumulate to a significant amount with time. There are a number of measures to employ when saving money. Some of them include:

• Deciding whether your saving plan is short, medium or long-term

• Determining the amount you want to save and use the Scheduled Transfers option on the FNB App or Online Banking to add an amount you would like to save

• Formulating or adjusting your budget to avoid impulsive spending.

• Earmark what you are saving for

• Opening a savings account

• Keeping track of your savings as they grow and if and when you make withdrawals

Stop order A stop order is an arrangement whereby a customer instructs the bank through official writing that a certain amount of money should be transferred to a stipulated account of either a company or an individual. It can be ceased or altered if the need arises. A stop order is important in a sense that: It is helpful for the customer An account holder is relieved from the fuss of having to make the same money transfer to the same account, every now and then. Once an agreement is reached with the bank, the payments will be scheduled for automatic transfers.

It curbs delayed payments Doing a series of payments manually can result in delays thereby inconveniencing the recipient. The best way to ensure prompt payments is to schedule a stop order.

Avoiding penalties Like any other process, banking can be accompanied by repercussions if not done appropriately, or in instances where certain procedures were not followed. Penalties normally apply when a transaction has bounced due to factors like insufficient funds. Over limit fees and unpaid fees usually occur when a payment bounces.

Here are some tips to help avoid penalties

• Observing the bank balance Constantly checking your bank balance will save you from abrupt penalties encountered as a result of bounced payments.

You can check your balance with ease on cellphone banking, online banking and the FNB App. NB: Balance checking is free of charge.

• Linking accounts Linking your accounts can help prevent bounced transactions thereby eliminating overdraft and non-sufficient funds fees. This is because the other account acts as a backup when the other one becomes insolvent. You can link all your accounts on the FNB App and be able to seamlessly transfer funds.

• Reduce frequent withdrawals on the Savings Account The principal goal of a Savings Account is to save money. A bank user should therefore avoid excessive money withdrawals from their Savings Account in order to avoid penalties. For instance, Flexi-Fixed Account allows only two withdrawals for a particular duration i.e. 6 months or 12 months. The withdrawals are also subject to a maximum of 15% of the available balance.

• Avoid inactivity of accounts Accounts which are seldom used yet active are likely to become dormant. Clients should actively utilise their accounts and deposit money so as to avoid dormancy. Understanding the basics of banking doesn’t have to be an overwhelming exercise for you. Start with regularly monitoring your account through FNBB’s digital banking channels and have peace of mind and better control of your bank account.