what is the essential difference between retail and business banking?
Written By: admin on May 4, 2009
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If retail banking deals with individual day-to-day customer then what does business banking involve? Are they closely interrelated?
Thank you.
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"Business Banking" tends to work with small-to-medium sized enterprises (SMEs). Business banking does all the things that retail banking does but adds the following things:
1) More services. Business Banking includes things like more treasury services, revolving credit, merchant credit, cash management, group insurance, corporate cards and secure Internet banking (e.g. server-to-server).
2) Better rates. Since SMEs bring in more money, they tend to get better rates than the retail banking customer, who tends to need lots of maintenance compared to their deposit sizes.
Retail, SME and corporate banking customers use the same infrastructure, but the sales platforms tend to be different to cater to their specific needs.