Deciphering Banking Abbreviations

by Yuvi K - December 16, 2023

Introduction to Deciphering Banking Abbreviations

Banking industry is an integral part of our daily lives, whether it is savings, investments or borrowing money. The use of banking jargon can be daunting for many customers, as most don’t understand the seemingly endless list of abbreviations and acronyms that go along with procedures, products and services available. Therefore, it is important to understand the jargon associated with banking in order to make an informed decision.

Common Banking Abbreviations

This article outlines some of the common banking abbreviations and what they stand for. Here is a list of some of the commonly used banking abbreviations.

Abbreviation Meaning

Aprroach Towards Banking Abbreviations

In order to make an informed decision, it is important to understand the purposes of the various banking abbreviations. This section of the article will look at some of the key abbreviations and their functions.

ATM

The abbreviation ATM stands for Automated Teller Machine (ATM) (स्वचालित टेलर मशीन). These machines are situated outside or inside a bank and allow customers to perform various banking operations. This includes withdrawing money from an account, deposit cash into the account, transferring funds from one account to another, check account balances and get mini-statements. Most ATMs also offer additional services like bills payment and booking movie tickets.

FD

The abbreviation FD stands for Fixed Deposit (FD) (निरंतर जमाएं). This is a type of investment where the customer puts a fixed sum of money into the account for a certain period of time. This time period usually ranges from 6 months to 5 years and higher. The major benefit of FDs is that they usually offer higher interest rates than a normal savings account, and the interest earned is usually tax-free.

SIP

The abbreviation SIP stands for Systematic Investment Plan (SIP) (सिस्टमेटिक निवेश योजना). This is a convenient way for investors to invest in a mutual fund. The SIP allows investors to invest a fixed amount of money into a mutual fund on a regular basis. This helps investors to save for long-term goals, such as retirement and children’s education.

PPF

The abbreviation PPF stands for Public Provident Fund (PPF) (सार्वजनिक आर्थिक प्रोत्साहित फंड). This is a long-term investment product that is offered by the Government of India. This provides investors with a safe and tax-free means of saving money. The PPF offers higher returns as compared to other investments, and the funds are secured against any borrowing or alienation.

NEFT

The abbreviation NEFT stands for National Electronic Funds Transfer (NEFT) (राष्ट्रीय ईलेक्ट्रॉनिक फंड ट्रांसफर). This is a service offered by banks in India where customers can transfer funds from their bank account to other bank accounts across India. The process is simple and secure and customers do not have to be present at the bank to initiate the transfer.

RTGS

The abbreviation RTGS stands for Real Time Gross Settlement (RTGS) (रीयल टाइम ग्रॉस सेटलमेंट). This is another service offered by the banks in India which enables customers to transfer funds with real-time accuracy. With RTGS, customers can transfer large amounts of money quickly and securely.

ACU

The abbreviation ACU stands for Account Closure Unit (ACU) (कस्टोडी मालिकी ट्रांसफर). This is a unit of the bank which handles all the requests for the closure of accounts such as savings accounts, fixed deposits, current accounts, etc. The customer’s request is considered and if all the formalities are completed, the account is closed.

MO

The abbreviation MO stands for Mode of Operation (MO) (कार्रवाई के मोड). This is a method that the bank