Banking & LendingBanking & Lending GlossaryPart 1 of 13
The Business Glossary
43 terms from the Banking & Lending book's The Business part, each defined in a line and linked to the chapter that explains it.
- Account: one deposit, loan or line contract with one institution, under one product version and in at most one program (The Banking & Lending Business).
- Account party: a party's role on an account (owner, joint owner, authorized signer, beneficiary, guarantor, co-borrower), effective-dated, deciding insurance, authority and liability (The Banking & Lending Business).
- Available balance: ledger balance less open holds, plus any funds the institution makes available early; what the customer can spend now (The Banking & Lending Business).
- Balance snapshot: an account's ledger, available and collected balances frozen for one business date, which statements, interest and overdraft decisions read (The Banking & Lending Business).
- Case: a dispute, error claim, fraud claim, legal process, complaint or investigation, with the time notice arrived, the rule's deadline and the outcome (The Banking & Lending Business).
- Collected balance: the part of an account's balance that has actually cleared (The Banking & Lending Business).
- Community bank: the FDIC's category for smaller, relationship-focused banks; 3,818 of 4,238 insured institutions at June 30, 2026 (The Banking Landscape).
- Credit decision: the record of an approval, counteroffer or decline with its frozen inputs, policy and model versions, outcome and principal reasons (The Banking & Lending Business).
- Credit union: a member-owned cooperative depository chartered by NCUA or a state and insured by the NCUSIF; 4,214 federally insured at June 30, 2026 (The Banking Landscape).
- Deposit beta: the share of a change in the policy rate that a bank passes on to its depositors' rates (The Banking & Lending Business).
- Disclosure: a record of what was shown or sent to a customer: the template version, the rendered document, the channel, the time and the E-SIGN consent relied on (The Banking & Lending Business).
- Exempt issuer: a debit card issuer with less than $10 billion in assets with its affiliates, outside Regulation II's interchange cap (The Banking & Lending Business).
- FDIC certificate number: the FDIC's identifier for an insured institution, the key to its public data (The Banking Landscape).
- Field of membership: the definition of who may join a credit union, checked as an account opening rule (The Banking Landscape).
- Gain on sale: the difference between what an investor pays for a loan and its cost to originate, booked when the loan is sold (The Banking & Lending Business).
- GL account: an account in the institution's chart of accounts, with its type, normal side and call report line (The Banking & Lending Business).
- Hold (deposit account): an amount set aside from an account's available balance without changing its ledger balance, for a card authorization, deposit availability, legal process, fraud or collateral, with an expiry (The Banking & Lending Business).
- Independent mortgage company: a nonbank mortgage lender; 63.1% of home-purchase loans in 2023 HMDA data (The Banking Landscape).
- Institution: a bank or credit union, with its charter type, primary regulator, FDIC certificate or NCUA charter number and RSSD ID (The Banking & Lending Business).
- Institution event: a dated merger, acquisition, failure, charter conversion, name change or core conversion, with the routing numbers it moved and its source (The Banking Landscape).
- Interchange: the fee the acquirer pays the issuer on every card transaction, set by the networks' tables (The Banking & Lending Business).
- Interest accrual: a day's interest on an account, computed at full precision before it posts as a journal entry (The Banking & Lending Business).
- Journal entry: one balanced money movement in the institution's books, with lines that sum to zero, a business date, a source and an idempotency key (The Banking & Lending Business).
- Ledger balance: the sum of an account's posted transactions (The Banking & Lending Business).
- Line: an account with a limit the customer can draw and repay, such as a credit card, a HELOC or a business line of credit (The Banking & Lending Business).
- Loan: the lending terms that extend a loan or line account: principal, rate, term, amortization method, owner and servicer (The Banking & Lending Business).
- Middleware (BaaS platform): software between fintech programs and banks that provides accounts, cards, payments and a subledger as an API (The Banking & Lending Business).
- Mortgage servicing right (MSR): the right to service a mortgage and collect its servicing fee, an asset that can be bought and sold (The Banking & Lending Business).
- Neobank: a consumer fintech offering bank accounts in its own brand, either as a program manager on sponsor banks or with its own charter (The Banking Landscape).
- Net interest income: interest earned on loans and securities less interest paid on deposits and borrowings (The Banking & Lending Business).
- Net interest margin (NIM): net interest income over average earning assets; 3.32% for FDIC-insured institutions in the second quarter of 2026 (The Banking & Lending Business).
- Ownership category: the FDIC's classification of how a deposit is held (single, joint, retirement, trust, employee benefit, business, government), each insured separately (The Banking & Lending Business).
- Party: a person or business, independent of any account (The Banking & Lending Business).
- Party identity: a verified identifier for a party, with the method, the vendor's result and when it was verified (The Banking & Lending Business).
- Product version: one immutable set of a product's rates, fees, limits and terms; an account stays on its version until moved with notice (The Banking & Lending Business).
- Program: a fintech's product on an institution's charter, with its program manager, any middleware and its product scope (The Banking & Lending Business).
- Program manager (banking program): the company that designs, markets and services a deposit, card or lending product on a sponsor bank's charter (The Banking & Lending Business).
- Regulation II: the Federal Reserve's rule capping debit interchange for issuers of $10 billion or more at 21 cents plus 0.05% plus a fraud-prevention adjustment of up to 1 cent; its 21-cent standard was held invalid by the Eighth Circuit on October 26, 2026, pending the mandate (The Banking & Lending Business).
- RSSD ID: the Federal Reserve's identifier for a financial institution, used across its releases and structure data (The Banking Landscape).
- Servicer: the company that bills, collects and reports a loan, which may not own it (The Banking & Lending Business).
- Sponsor bank (deposits and lending): a bank that holds the accounts and issues the cards and loans of a fintech program, and carries the program's regulatory obligations (The Banking Landscape).
- Technology provider: a core, digital banking, origination, card processing or BaaS vendor, recorded with which institutions run it and when (The Banking Landscape).
- Transaction: the customer-visible activity row on an account, linked to the journal entry that is its double-entry truth (The Banking & Lending Business).