Juan:'Where can you take out or withdraw the money that you have in a bank account from?'
Peter:'Lots of places now. You can go to a branch of the bank and withdraw your money from there.'
Juan:'What does a branch mean?'
Peter:'A branch is the name for the office of a bank which is open for their customers to use. You can also use a machine to withdraw money in your bank account from, which is called a cash machine. And also in some countries you can withdraw money from your bank account at checkouts in some shops/stores when you are buying something. This is called cashback.'
Juan:'And if I want to add or put money into my bank account. Where can I do that?'
Peter:'You can deposit or put money into your bank account, in both branches and in some cash machines.'
Juan:'On a cash machine, can you see your bank account balance? How much money you have in a bank account.'
Peter:'Yes, you can. You can also ask the cashier/bank teller in a branch of the bank to tell you what your balance is too.'
Juan:'But what if I want to see more information than just the balance of my bank account. What do I do if I want to see the transactions on the account. What money has been deposited in it (when and from who) and what money has been taken out from it (when and to who)?'
Peter:'All this information is contained in a document called a bank statement. Normally, banks send you a bank statement every month. But you can also go and get one from a branch, from some cash machines and you can also see it online on a bank's website.'
Juan:'And if I want to move money from my bank account to somebody else's bank account. How would I do that? Would I have to withdraw the money and then go with the money in my hand to their bank and deposit it in their bank account?'
Peter:'You can do that, but it's not very safe to walk around with a lot of money. It's safer to write the person a cheque, which is a piece of paper from the bank that people use to pay other people from money in their bank account. The problem with using cheques is that when the person gives their bank the cheque, it takes 3 days to clear. That means that it will be 3 days before the money is moved to their bank account and they can use it.'
Juan:'Is there any better method to move money?'
Peter:'Yes, there is. Banks provide a service to their customers where they move your money electronically to another person's bank account. This is called a bank transfer. You just need to need to know the other person's bank account details, their bank account number etc... When you make a bank transfer the money is moved instantly.'
Peter:'There are two types of bank transfers which are very useful if you have to make regular payments to people or companies and want them to be done automatically. If you need to pay or transfer a fixed amount of money which doesn't change to a company or someone regularly (e.g. every month or 3 months), then you can create a standing order on your bank account. Money will then automatically be repeatedly transferred out of your bank account until you stop the standing order.'
Juan:'That sounds useful. But that wouldn't work where the amount of money you have to move or transfer changes every month or 3 months. For example, for paying electricity or phone bills.'
Peter:'No, the amount transferred doesn't change with a standing order. Where the amount of money transferred changes every time, you have to use an automatic bank transfer called a direct debit. Also with a direct debit, the time when money is taken out can change (it doesn't have to go out of your account on a regular date). This type of bank transfer can only be used to transfer money to companies. With a direct debit, you give permission to the company withdrawing money from your bank account to change the amount they take without telling you first.'
Juan:'And if I use more money than is in my bank account. What happens?'
Peter:'When you withdraw or use more money than is in your bank account, you are what is called overdrawn. If this happens, you won't be able to withdraw any more money from the account and the bank will charge you money (you have to pay them some money).'