What Are the Different Types of Banking Transactions?

Laura M. Sands

Among the various types of banking transactions are wire transfers, online bill payments and credit card transactions. Other financial transactions that may occur through a bank include mortgage loans and small business loans. Several different types of banking transactions can take place in person, by telephone or online.

Credit card transactions are one type of banking transaction.
Credit card transactions are one type of banking transaction.

Various payment transactions make doing business easier. Among these options is a payment method known as a wire transfer. Essentially, transactions utilizing this method involve the transfer of funds from one party’s banking account to another party’s banking account. These business transactions are a routine way of doing business in some parts of the world and help make international business transactions more effective.

People can access their accounts at the drive-thru.
People can access their accounts at the drive-thru.

Online transactions are also an effective way of handling banking transactions. By establishing a checking account that allows online transactions, account holders are able to schedule bills to be paid automatically each month or are given the option of manually paying bills online from a personal computer. Online banking also allows account holders to monitor funds in an account without having to call or visit a bank in person to obtain transaction records.

Some customers may make a majority of their banking transactions online.
Some customers may make a majority of their banking transactions online.

Individuals or businesses approved for bank credit cards are also able to initiate credit card transactions for purchases. These banking transactions present the user with a convenient way to purchase items, pay bills, rent cars or perform a variety of other financial transactions without using cash. Credit card holders also do not have to pay for an item’s entire amount at the time of purchase, but are able to repay the amounts charged in smaller increments, instead. Credit card transactions are, however, accompanied by additional interest charges and other fees may apply.

Typically, depositing a check online involves taking a picture of the check on a cellphone or scanning it into a computer.
Typically, depositing a check online involves taking a picture of the check on a cellphone or scanning it into a computer.

When purchasing a home, starting a new business, expanding a business or when in need of funds for a variety of different interests, banking transactions that lend money to borrowers are often sought. These transactions do not require the borrower to be a current banking customer, but upon credit approval individuals and businesses can receive financial loans. The amounts and terms of each loan vary, and a borrower may even have more than one loan from more than one banking institution. While most other banking transactions may transpire online or by phone, the process of obtaining a bank loan most often requires an in-person visit to a bank to discuss options, submit an application and sign for the release of funds if a loan is approved.

Online banking allows account holders to monitor funds in an account without having to call or visit a bank in person.
Online banking allows account holders to monitor funds in an account without having to call or visit a bank in person.

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Discussion Comments


What type of transactions must be in person?


@Comparables- I know just how difficult it is to end recurring ACH transactions. I signed up for a gym membership at a place that was a complete sham. The gym went out of business, but the ACH transactions continued for months. Come to find out the owner was being investigated for fraud and selling steroids. Anyway, I had to close my account to get the charges to stop. Sounds archaic right...especially in the information age.

Now I always ask if there is a way to set up automatic payments through my credit card or debit card. This way I can take advantage of the credit card and banking offers (points, miles, etc.) that come with the cards.

Additionally, in the case of fraud, all I need to do is cancel my card and order a new one. Most cards are also warranted against fraud, insuring that you will not be liable for fraudulent charges. Paying ten dollars for a new card is much less of a hassle than contacting all the places I have an ACH transaction with and filling out endless paperwork to set up new ACH transactions. Take it from me...opt for your card.


@comparables- An ACH or Automatic Clearing House transaction is essentially a transaction that allows a person, company, or other organization to directly debit or credit a person's bank account. It is essentially an electronic check that is processed at a clearing house or federal reserve bank. These transactions are commonly used for direct deposit transactions, paying mortgages and other recurring bills, and for business-to-business (B2B) transactions.

ACH transactions are great for paying large bills, but you should be careful in the situations that you use them. Setting up an ACH transaction involves giving a person or organization your account and routing numbers. If this person or entity breaches your trust, it can be costly and difficult to stop the payments. You will have to close the account to end the automatic payments permanently.

You would think that bank transaction software would allow a bank to cancel ACH credits and debits, but if both parties do not agree to end the transaction, then it will continue. This is because ACH transactions are not actually handled by the bank. Instead, they are handled by the clearing house.


What is an ACH bank transaction and how do they work? Is it better to sign up for an ACH transaction or should I use recurring payments on a debit or credit card? I am thinking about signing up for a golf club membership, but the terms are a little confusing. There are a number of fees and stipulations regarding canceling my membership. Which type of bank transfer is safer?

I have had bad experiences with cancelling services before (cable and phone), and I want to make sure that I can force a company to honor their contract. I had a bill dispute with former phone and cable companies, and I was still charged for service while I disputed the charges. I ended up getting a credit for the overcharges, but I had to overpay for a few months before the dispute was settled.


@GlassAxe- Make sure you keep track of all the bank transaction codes for your transaction. I had three Swiss wire transfers processed into different accounts at the same bank, and one was lost. Two of the transfers were instant, but the third was hung up at a New York bank where international wires enter the country.

The error turned out to be a typo with the SWIFT code, and the transaction was hung up for almost two months. Both banks tried to pass that blame on each other. Without the original transaction numbers, the process of finding my money would have taken much longer. Wires are not perfect, so always keep documentation of any transactions processed.


@GlassAxe- I would not fret about your bank wire yet. International transactional banking has a number of variables that can affect the time taken to complete a transaction. I wire money between international accounts on a regular basis because of my line of work, and it can take up to a week for a wire to go through. A wire transfer must make multiple stops on its way from one account to the next, and with time zone and exchange rate considerations, the process can be laborious.

I would not start to worry until five business days have passed since the transfer was initiated. I have had transactions from Switzerland process in the same business day, while I have had transfers from China or Hong Kong take up to a week.

Double check that you have given the correct SWIFT code, account number, and routing number, and give it a couple more days. If you have a problem, contact both the originating bank and the recipients bank. Wires are tracked every step of the way, so the customer service representatives can track the transfers if need be.


How long does an international bank wire take to credit to an account? I am expecting a transfer from a Japanese bank to a U.S. bank. It has been two days with no funds being credited to my account.

I thought online banking business was done instantly. I thought that the transaction would have been completed in a business day or less. The transfer amount is fairly substantial, and I am a little nervous about the transaction getting lost. Does anyone have experience with international wire transfers?

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