1. Verifying customer identification:
Involves checking different forms of identity, such as driver's licenses, passports, and utility bills. This is essential for preventing fraud and money laundering. Additionally, banks must take steps to ensure that the identity being presented is actually the individual’s real information. Biometrics such as facial recognition or fingerprint scans can be used to provide extra layers of security.
2. Review account opening documents:
This involves verifying that all the appropriate paperwork has been filled out accurately and completely, including signatures and other necessary forms. The bank must also review customer data to ensure that no errors have been made when entering information into the system. This is vital for avoiding any potential issues further down the line.
3. Process account opening:
This involves setting up the customer's account and linking it to other accounts, such as savings or checking accounts. This is also when any applicable fees are charged and interest rates are determined. The bank must ensure that all of these details have been entered accurately and completely into their system.
4. Activate account:
This is when the customer's new account is officially activated and ready to use. This process typically involves setting up a username and password, as well as issuing cards or tokens that can be used to access the account. Additionally, customers must be given full instructions on how to use their new accounts and any additional services.
5. Order checks and deposit slips:
These are necessary for customers to conduct any type of banking transaction, such as depositing or withdrawing funds. It is important that the correct amount of checks and deposit slips are ordered and delivered in a timely manner. Additionally, these items must be properly printed with the customer's name and bank account information.
6. Set up online banking and bill pay:
This involves creating a secure online portal for customers to conduct their banking activities, such as checking their balances or transferring funds between accounts. Furthermore, this is when banks set up services like automatic payments for bills and other recurring charges on the user's behalf. This helps to streamline the banking process and make it easier for customers to manage their finances.
7. Transfer funds between accounts:
This is when a customer transfers money from one account to another, whether it's from their checking account to their savings or vice versa. This type of transaction usually requires additional steps, such as verifying customer information and ensuring that there are sufficient funds in the account.
8. Close accounts and process withdrawals:
When customers decide to close their accounts, banks must take the necessary steps to ensure that this is done correctly. This includes processing any outstanding payments or transfers, as well as returning any leftover funds in the account. Additionally, banks must also ensure that all records are updated properly when an account is closed.
9. Monitor for fraud or suspicious transactions:
Banks must remain vigilant for any signs of potentially fraudulent activity, such as uncharacteristic money transfers or large withdrawals from an account. It is important that banks have the necessary systems and technologies in place to detect these types of activities and take appropriate action in a timely manner.
10. Reconcile accounts and prepare financial statements:
At the end of every month, banks must reconcile their accounts to make sure that all transactions have been correctly recorded and accounted for. This also involves preparing financial statements which provide an accurate record of a bank's financial position at any given point in time. Additionally, this is when banks must prepare reports which demonstrate compliance with regulatory requirements.