A-Z of Financial Terms
Financial terminology can be mind boggling but it is essential that you have an understanding
of banking terms if you are to understand consumer credit agreements and other financial
We have created this checklist to help you identify basic banking terms.
APR – Total cost of borrowing including all associated
loan costs – interest, legal, valuation, arrangement
costs etc. Represents true cost of borrowing.
Be wary of interest not described as APR as this may
not represent total charges associated with borrowing
– there may be added arrangement or final settlement
ATM - Automated Teller Machine. A cash machine.
It will give you money when you put your debit/credit
card in (may charge an administration fee).
Try to avoid machines that charge for withdrawals.
You’ll be surprised how this adds up over the year –
why give this money to the bank when it’s yours?
Basic Account - Basic accounts must have the
employers may pay salaries directly into them;
government benefits may be paid directly into
cheques and cash may be paid into them;
account holders may pay bills by direct debit;
cash may be withdrawn from cash machines;
the accounts do not have overdrafts;
all money held in the accounts may be
These accounts offer a solution for those who may
have, at one time, been in financial difficulty. This
may offer a way of managing money if an application
for a regular current account has been declined due to
previous mismanagement of finances e.g. CCJs.
Base Rate - The interest set by the Bank of England
on which other banks base their rates. Lenders usually
The My Money Extra initiative at King’s
College London is part of a national project
aiming to improve students’ financial capability,
led by the Financial Services Authority
My Money Extra
Student Advice & International Student Support
follow it by adjusting their Standard Variable Rate.
Consider the affect base rate increases may have