reserve bank(austrailia)

he Reserve Bank of Australia came into being on 14 January 1960 as Australia'scentral bank and banknote issuing authority, when the Reserve Bank Act 1959 removed the central banking functions from the Commonwealth Bank to it.^[2]

The Bank has the responsibility of providing services to the Government of Australia, which the profits of the Bank are transferred back to, in addition to also providing services to other central banks and official institutions.^[3] It currently consists of the Payments System Board, which governs the payments system policy of the Bank, and the Reserve Bank Board, which governs all other monetary and banking policies of the bank.^[4]

Both Boards consist of members of both the Bank, the Treasury, other Australian government agencies, and leaders of other institutions that are part of theeconomy.^[4][5] The structure of the Reserve Bank Board has remained consistent even since 1951, with the exception of the change in the number of members of the Board.^[2]The Governor of the Reserve Bank of Australia is appointed by the Treasurer and chairs both the Payment Systems and Reserve Bank Boards and when there are disagreements between both Boards, the Governor resolves them.^[4][6]

From the middle of the 19th century into the 1890s, the prospects of a national bankforming grew. In 1911, the Commonwealth Bank was established, but did not have the authority to print notes, which was a power that was still reserved to the Treasury. A movement toward reestablishing the gold standard occurred after World War I, with John Garvan leading various boards in contracting the money supply on the route to doing so, and the gold standard was instituted for both the British pound sterling and the Australian pound in 1925.^[7]

During the Great Depression, the Australian pound became devalued, no longer worth the pound sterling, and formally departed from the gold standard with the Commonwealth Bank Act of 1932.^[8] Legislation in 1945 led toregulation of private banks which H.C. Coombs was opposed to, and when he became Governor in 1949, he gave them more overall control over their institutions.^[2][7] When the monetary authorities implemented the advice of Coombs to have a flexible interest rate, it allowed the Bank to rely more on open market operations.^[7]

The float of the Australian dollar happened in 1983, around the same period of time that the financial system in Australia was deregulated. Administration of the banks was transferred in 1998 from the Bank to the Australian Prudential Regulation Authority and the Payments System Board was created, while the Bank was given power within the said Board in the same year.^[2] The current Governor of the Reserve Bank isGlenn Stevens, who has been the incumbent since 18 September 2006.^[9

banking career

Commercial banks are in the business of providing banking services to individuals, small businesses and large organizations. While the banking sector has been consolidating, it is worth noting that far more people have jobs in the commercial banking sector than any other part of the financial services industry. Jobs in banking can be exciting and offer excellent opportunities to learn about business, interact with people and build up a clientele.

Today's commercial banks are more diverse than ever. You'll find a tremendous range of opportunities in commercial banking, starting at the branch level where you might start out as a teller to a wide variety of other services such as leasing, credit card banking, international finance and trade credit.

If you are well-prepared and enthusiastic about entering the field, you are likely to find a wide variety of commercial banking jobs open to you. Carefully read through the material below as you decide whether you've got what it takes to pursue a career in commercial banking.

merchant bank account

Merchant Account Marketing

Merchant accounts are marketed to merchants by two basic methods: either directly by the processor or sponsoring bank, or by an authorized agent for the bank and additionally directly registered with both Visa and MasterCard as an ISO/MSP (Independent Selling Organization / Member Service Provider). Marketing details are by card issuers like Visa and MasterCard, and are enforced by various rules and fines. A few of the largest processors also partner with warehouse clubs to promote merchant accounts to their business members, such as Costco andElavon.

[edit]Marketing by Banks

A bank that has a merchant processing relationship with Visa and Mastercard, also known as a member bank, can issue merchant accounts directly to merchants. To reduce risk, some banks limit approval to merchants in its geographical area, those with a physical retail storefront, or those that have been in business for 2 years or more.

[edit]Marketing by Independent Sales Organization (ISO)/MSPs

To market merchant accounts, an ISO/MSP must be sponsored by a member bank. This sponsorship requires that the bank verify the financial stability and suitability of the company that will be marketing on its behalf. The ISO/MSP must also pay a fee to be registered with Visa and Mastercard and must comply with regulations in how they may market merchant accounts and the use of copyrights of Visa and Mastercard. One way to verify if an ISO/MSP is in compliance is to check a website or any other marketing material for a disclosure "company is a registered ISO/MSP of bank, town, state. FDIC insured". This disclosure is required by both Visa and Mastercard and will cause a fine of up to $25,000 if it is not clearly visible. In almost all cases, if there is no disclosure, the company is likely to be an uninformed 4th party or worse. In many cases unregistered operators have been responsible for some of the worst horror stories from merchants.

[edit]Rates and fees

A Merchant Account has a variety of fees, some periodic, others charged on a per-item or percentage basis. Some fees are set by themerchant account provider, but the majority of the per-item and percentage fees are passed through the merchant account provider to the credit card issuing bank according to a schedule of rates called interchange fees, which are set by Visa and Mastercard. Interchange fees vary depending on card type and the circumstances of the transaction. For example, if a transaction is made by swiping a card through a credit card terminal it will be in a different category than if it were keyed in manually.

[edit]Discount Rates

The discount rate comprises a number of dues, fees, assessments, network charges and mark-ups merchants are required to pay for accepting credit and debit cards, the largest of which by far is the Interchange fee. Each bank or ISO/MLS has real costs in addition to the wholesale interchange fees, and creates profit by adding a mark-up to all the fees mentioned above. There are a number of price models banks and ISOs/MLSs use to bill merchants for the services rendered. Here are the more popular price models:

[edit]3-Tier Pricing

The 3-Tier Pricing is the most popular pricing method and the simplest system for most merchants, although the new 6-Tier Pricing is gaining in popularity. In 3-Tier Pricing, the merchant account provider groups the transactions into 3 groups (tiers) and assigns a rate to each tier based on a criterion established for each tier.

merchant banking

In banking, a merchant bank is a financial institution primarily engaged in offering financial services and advice to corporations and to wealthy individuals. The term can also be used to describe theprivate equity activities of banking.^[1] The chief distinction between an investment bank and a merchant bank is that a merchant bank invests its own capital in a client company whereas an investment bank purely distributes (and trades) the securities of that company in its capital raising role. Both merchant banks and investment banks provide fee based corporate advisory services including in relation to mergers and

History

Merchant banks, now so called, are in fact the original "banks". These were invented in the Middle Ages by Italian grain merchants. As the Lombardy merchants and bankers grew in stature based on the strength of the Lombard plains cereal crops, many displaced Jews fleeing Spanish persecution were attracted to the trade. They brought with them ancient practices from the middle and far east silk routes. Originally intended for the finance of long trading journeys, these methods were now utilized to finance the production of grain.

The Jews could not hold land in Italy, so they entered the great trading piazzas and halls of Lombardy, alongside the local traders, and set up their benches to trade in crops. They had one great advantage over the locals. Christians were strictly forbidden the sin of usury. The Jewish newcomers, on the other hand, could lend to farmers against crops in the field, a high-risk loan at what would have been considered usurious rates by the Church, but did not bind the Jews. In this way they could secure the grain sale rights against the eventual harvest. They then began to advance against the delivery of grain shipped to distant ports. In both cases they made their profit from the present discount against the future price. This two-handed trade was time consuming and soon there arose a class of merchants, who were trading grain debt instead of grain.

The Jewish trader performed both finance (credit) and an underwriting (insurance) functions. He would derive an income from lending the farmer money to develop and manufacture (through seeding, growing, weeding and harvesting) his annual crop (the crop loan at the beginning of the growing season). He would underwrite (insure) the delivery of the crop (through crop or commodity insurance) to the merchant wholesaler who was the ultimate purchaser of the farmer’s harvest. And he would make arrangements to supply this buyer through alternative sources (the merchant function) of supply (such as grain stores or alternate producer markets), should any particular farming district suffer a seasonal crop failure. He could also keep the farmer (or other commodity producer) in business during a droughtor other crop failure, through the issuance of a crop (or commodity) insurance against the hazard of failure of his crop.

Thus in his underlying financial function the merchant banker (trader) would ensure the continuous smooth flowing of the commodity (crop, wool, salt; salt-cod, etc.) markets by providing both credit and insurance.

It was a short step from financing trade on their own behalf to settling trades for others, and then to holding deposits for settlement of "billete" or notes written by the people who were still brokering the actual grain. And so the merchant's "benches" (bank is a corruption of the Italian for bench, banca, as in a counter) in the great grain markets became centers for holding money against a bill (billette, a note, a letter of formal exchange, later a bill of exchange, later still, a cheque).

These deposited funds were intended to be held for the settlement of grain trades, but often were used for the bench's own trades in the meantime. The term bankrupt is a corruption of the Italian banca rotta, or broken bench, which is what happened when someone lost his traders' deposits. Being "broke" has the same connotation.

A sensible manner of discounting interest to the depositors against what could be earned by employing their money in the trade of the bench soon developed; in short, selling an "interest" to them in a specific trade, thus overcoming the usury objection. Once again this merely developed what was an ancient method of financing long distance transport of goods.

Islam makes similar condemnations of usury as Christianity.

The medieval Italian markets were disrupted by wars and in any case were limited by the fractured nature of the Italian states. And so the next generation of bankers arose from migrant Jewish merchants in the great wheat growing areas of Germany and Poland. Many of these merchants were from the same families who had been part of the development of the banking process in Italy. They also had links with family members who had, centuries before, fled Spain for both Italy and England.

This course of events set the stage for the rise of banking names which still resonate today: Schroders, Warburgs, Rothschilds, even the ill-fated Barings, were all the product of the continental grain trade, and indirectly, the early Iberian persecution of Jews. These and other great merchant banking families dealt in everything from underwriting bonds to originating foreign loans. Bullion trading and bond issuing were some of the specialties of the Rothschild family..

banking lesson plan

urpose and Audience:

The purpose of these materials is to get the students speaking about all of the terms related to their personal finances in English. In particular, students will role-play being either bank clients or bankers. The bank clients will visit the bank and talk to the bankers about various financial products such as credit cards and mortgages. After the bankers explain the financial products, the client will select one product and apply. The bankers will then open up a bank profile and start a credit evaluation.

Having just moved back to Canada from Asia, I have undergone this exact process several times. The credit evaluation and bank profile are in reality not that difficult. For the most part, my bank representative just asked basic questions about income and debt. I think the hardest thing for students will be the amount of technical vocabulary involved. Though there is a lot, it is certainly worth learning for anybody who plans to work in banking, business, government, or finances. It is also very important for individuals moving to English countries as they probably will want to apply for credit cards, open accounts, and take out mortgages. It goes without saying that this lesson is intended for adults.

To smoothen the process of learning all of this technical vocabulary, I’ve created several pre-class vocabulary assignments. I recommend that students be made to finish these before the role-play begins. There will probably not be enough time to go over the sheets and do the role-play in a single class. In fact, the role-play itself could go for a full two hours if you have the time to do it.

banking activities

In previous press releases ABN AMRO has announced that ABN AMRO Bank N.V. ("ABN AMRO") and RBTT Financial Holdings Limited ("RBTT") have signed a sale/purchase agreement regarding the sale of the onshore banking activities of ABN AMRO in Curaçao, and all its banking activities in Bonaire to Antilles Banking Corporation (Curaçao) N.V. ("ABC"), and the banking activities of ABN AMRO in Sint Maarten to Antilles Banking Corporation (Sint Maarten) N.V. ("ABC").

ABN AMRO is pleased to announce that on 5 November 2001 all assets and liabilities pertaining to ABN AMRO's onshore banking activities in Curaçao and all its banking activities in Bonaire, and the banking activities of ABN AMRO in Sint Maarten, have been transferred to ABC.

ABC has changed its name to RBTT Bank Antilles N.V. and RBTT Bank St. Maarten N.V. respectively to identify it as a member of the RBTT Group. The transfer of assets and liabilities includes the transfer of ABN AMRO's entire banking relationship with its clients, which means that their banking relationship with effect from 5 November 2001 is with RBTT Bank Antilles N.V. and RBTT Bank St. Maarten N.V. respectively.

ABN AMRO is grateful for the confidence the clients have given during all these years and trusts that with RBTT the business, the employees and the clients of ABN AMRO are in good hands. ABN AMRO will have a minority stake in RBTT Bank Antilles N.V. for a period up to three years.

ABN AMRO will continue its offshore banking activities in Curaçao, as well as its present activities carried out through ABN AMRO Bank Asset Management N.V. and ABN AMRO Trust Company N.V.

Banking Companies Ordinance

The State Bank of Pakistan (SBP) has proposed major changes to the Banking Companies Ordinance-1962 to bring all deposit taking Non-Bank Financial Companies (NBFCs) like investment banks, leasing companies and housing finance companies completely under the fold of SBP.

The major rationale behind this move is that these NBFCs are engaged in activities which are quite incidental to banking both on the liability as well as asset side.

Bringing such entities under SBP would lead to greater supervisory efficiency as being regulator of banks. Its supervisory approach was well-equipped for their kind of business. The proposed amendments would enable Pakistan to ensure compliance with this principle said Governor, State Bank of Pakistan Dr Shamshad Akhtar while delivering her key-note address on Pakistan : Framework for Consolidated Supervision at the 58th annual general meeting of Institute of Bankers Pakistan (IBP) here on Friday. She indicated that the SBP is positioning itself for moving to consolidated supervision, in anticipation of amendments in Banking Companies Ordinance (BCO)-1962 to empower SBP to launch this initiative. This is a timely move in the wake of potential risks arising from complex structures of financial groups and emergent supervisory challenges.

Dr Akhtar stated the SBP has proposed significant amendments in the Banking Companies Ordinance. The objective of these proposed amendments is to strengthen the oversight of financial sector in accordance with the 10- year strategy and blueprint of financial sector reforms of the SBP. Although Pakistan’s financial sector as a whole has a lot to gain through increased integration and conglomeration, the newly emerging phenomenon has to be properly monitored and governed under proper legal framework to mitigate the potential risks, she added.

The SBP, as part of its overall financial sector reforms launched in July 2008, has been advocating the need for legislature to empower the Central Bank to augment its oversight of the financial sector, she said adding that the legislative reforms proposed by the SBP in this area have recently been approved, in principle, by the Cabinet and will be tabled for consideration of the Parliament.

The SBP governor said the banking sector being at the core of all activities of the financial sector, its safety and soundness is critical for public, financial sector itself and the economy as a whole. However, the current legislation and regulatory tools are not adequate to effectively address the threats to safety and soundness of the financial sector, she observed.

Dr Akhtar said the amendments proposed by the SBP would result into significant benefits in the form of operational efficiency, lower costs, reduced prices and innovation in products and services. She said one of the Core Principles for effective banking supervision (CP-24) issued by Basel Committee on Banking Supervision requires that a banking supervisor should be able to supervise the banking groups on a consolidated basis.

Presently, Pakistan is either compliant or largely compliant with all the core principles except those dealing with consolidated supervision, she said.

Dr Akhtar said another change being sought in BCO is to authorise the SBP to designate and regulate the financial groups. Financial group for this purpose will be any group containing at least one of the entities, directly regulated by the SBP. This is an extremely important step because it will enable the central bank to effectively monitor the intra-group potentially dubious transactions involving banks and NBFCs and also will enable it to curtail the possible contagion risk.

The proposed amendments will also enable the SBP to seek information from the unregulated commercial entities and conduct limited inspection for verification of such information, she added. The SBP governor observed that for entities in a financial group, which are falling under securities regulator’s supervision, current supervisory mechanism also needs to be amended to move towards greater consolidated supervision. She further said that the time is ripe for the introduction of a Financial Holding Company (FHC) concept. For facilitating the FHC model, we are also seeking several amendments in the BCO covering its definition, licensing and supervision (which will be done by SBP), capital requirement and various other aspects, Dr Akhtar said.

banking tactics

USSR-POLAND: Soviet Banking Tactics

Moscow in late December reportedly instructed Soviet-owned banks chartered abroad to createreserve accounts to guardossible Polish default. The Poles owed these banks more0 million by midyear, but the Foreign Trade Bank of the USSR apparently assumed moreillion of this debt during the fall.

Comment: While the reported instruction may simply reflect concern over Western regulatory requirements, it also suggests Soviet pessimism about Poland's ability to resolve its financial problems. The Foreign Trade Bank's apparent assumption of roost of the Polish debt owed to these Soviet-owned banks puts themtronuer position toossible Polish default.

Read more: http://www.faqs.org/cia/docs/33/0000237153/USSR-POLAND:-SOVIET-BANKING-TACTICS.html#ixzz0aFFYRWPc

banking history(US)

History in the United States

Early Years to the Federal Reserve

In the United States the first bank was the Bank of North America, established (1781) in Philadelphia. Congress chartered the first Bank of the United States in 1791 to engage in general commercial banking and to act as the fiscal agent of the government, but did not renew its charter in 1811. A similar fate befell the second Bank of the United States, chartered in 1816 and closed in 1836.

Prior to 1838 a bank charter could be obtained only by a specific legislative act, but in that year New York adopted the Free Banking Act, which permitted anyone to engage in banking, upon compliance with certain charter conditions. Free banking spread rapidly to other states, and from 1840 to 1863 all banking business was done by state-chartered institutions. In many Western states it degenerated into "wildcat" banking because of the laxity and abuse of state laws. Bank notes were issued against little or no security, and credit was overexpanded; depressions brought waves of bank failures. In particular, the multiplicity of state bank notes caused great confusion and loss. To correct such conditions, Congress passed (1863) the National Bank Act, which provided for a system of banks to be chartered by the federal government.

In 1865, by granting national banks the authority to issue bank notes and by placing a prohibitive tax on state bank notes, an amendment to the act brought all banks under federal supervision. Most banks in existence did take out national charters, but some, being banks of deposit, were unaffected by the tax and continued under their state charters, thus giving rise to what is generally known as the "dual banking system." The number of state banks expanded rapidly with the increasing use of bank checks.

Recurrent banking panics caused by overexpansion of credit, inadequate bank reserves, and inelastic currency prompted Congress in 1908 to create the National Monetary Commission to investigate the banking and currency fields and to recommend legislation. Its suggestions were embodied in the Federal Reserve Act (1913), which provided for a central banking organization, the Federal Reserve System (see also central bank).

Further Legislation

Since the establishment of the Federal Reserve system, federal banking legislation has been limited largely to detailed amendments to the National Bank and Federal Reserve acts. The Glass-Steagall Act of 1932 and the Banking Act of 1933 together formed an extensive reform measure designed to correct the abuses that had led to numerous bank crises in the years following the stock market crash of 1929. The Glass-Steagall Act prohibited commercial banks from involvement in the securities and insurance businesses. The Banking Act strengthened the powers of supervisory authorities, increased controls over the volume and use of credit, and provided for the insurance of bank deposits under the Federal Deposit Insurance Corporation (FDIC). The Banking Act of 1935 strengthened the powers of the Federal Reserve Board of Governors in the field of credit management, tightened existing restrictions on banks engaging in certain activities, and enlarged the supervisory powers of the FDIC.

Deregulation, Bank Failures, and New Technology

Several deregulatory moves made by the federal government in the 1980s diminished the distinctions among various financial institutions in the United States. Two major changes were the Depository Institutions Deregulation and Monetary Control Act (1980) and the Depository Institutions Act (1982), which allowed savings and loan associations to engage in often-risky commercial loans and real estate investments, and to receive checking deposits. By 1984, banks had federal support in buying discount brokerage firms, and commercial banks were beginning to acquire failed savings banks; in 1985 interstate banking was declared constitutional.

Such deregulation was blamed for the unprecedented number of bank failures among savings and loan associations , with over 500 such institutions closing between 1980 and 1988. The Federal Savings and Loan Insurance Corporation (FSLIC), until it became insolvent in 1989, insured deposits in all federally chartered—and in many state-chartered—savings and loan associations. Its outstanding insurance obligations in connection with savings and loan failures, over $100 billion, were transferred (1989) to the FDIC.

Further deregulation occurred in 1999, when Congress overhauled the entire U.S. financial system. Among other actions, the legislation repealed the Glass-Steagall Act, thus allowing banks to enter the insurance and securities businesses. Supporters predicted that the measure would permit U.S. banks to diversify and compete more effectively on an international scale. Opponents warned that this deregulation could lead to failures of many financial institutions, as had occurred with the savings and loans.

In the last decades of the 20th cent., computer technology transformed the banking industry. The wide distribution of automated teller machines (ATMs) by the mid-1980s gave customers 24-hour access to cash and account information. On-line banking through the Internet and banking through automated phone systems now allow for electronic payment of bills, money transfers, and loan applications without entering a bank branch.

general history(banking)

General History

A simple form of banking was practiced by the ancient temples of Egypt, Babylonia, and Greece, which loaned at high rates of interest the gold and silver deposited for safekeeping. Private banking existed by 600 BC and was considerably developed by the Greeks, Romans, and Byzantines. Medieval banking was dominated by the Jews and Levantines because of the strictures of the Christian Church against interest and because many other occupations were largely closed to Jews. The forerunners of modern banks were frequently chartered for a specific purpose, e.g., the Bank of Venice (1171) and the Bank of England (1694), in connection with loans to the government; the Bank of Amsterdam (1609), to receive deposits of gold and silver. Banking developed rapidly throughout the 18th and 19th cent., accompanying the expansion of industry and trade, with each nation evolving the distinctive forms peculiar to its economic and social life.

banking facts

banking primarily the business of dealing in money and instruments of credit. Banks were traditionally differentiated from other financial institutions by their principal functions of accepting deposits—subject to withdrawal or transfer by check—and of making loans.

Types of Banks

Banks have traditionally been distinguished according to their primary functions. Commercial banks, which include national- and state-chartered banks, trust companies, stock savings banks, and industrial banks, have traditionally rendered a wide range of services in addition to their primary functions of making loans and investments and handling demand as well as savings and other time deposits. Mutual savings banks , until recently, accepted only savings and other time deposits, and offered limited types of loans and services. The fact that commercial banks were able to expand or contract their loans and investments in accordance with changes in reserves and reserve requirements further differentiated them from mutual savings banks, where the volume of loans and investments was governed by changes in customers' deposits. Membership in the Federal Deposit Insurance Corporation is compulsory for all Federal Reserve member banks but optional for other banks.

Other Financial Institutions

Types of financial institutions that have not traditionally been subject to the supervision of state or federal banking authorities but that perform one or more of the traditional banking functions are savings and loan associations , mortgage companies, finance companies, insurance companies, credit agencies owned in whole or in part by the federal government, credit unions, brokers and dealers in securities, and investment bankers. Savings and loan associations, which are state institutions, provide home-building loans to their members out of funds obtained from savings deposits and from the sale of shares to members. Finance companies make small loans with funds obtained from invested capital, surplus, and borrowings. Credit unions , which are institutions owned cooperatively by groups of persons having a common business, fraternal, or other interest, make small loans to their members out of funds derived from the sale of shares to members. The primary functions of investment bankers are to act as advisers to governments and corporations seeking to raise funds, and to act as intermediaries between these issuers of securities, on the one hand, and institutional and individual investors, on the other.

International Banks

The International Bank for Reconstruction and Development (World Bank) was organized (1945) to make loans both to governments and to private investors. The discharge of debts between nations has been simplified and facilitated through the International Monetary Fund (IMF), which also provides members with technical assistance in international banking. The former European Monetary Agreement also made possible the rapid discharge of debts and balance of payments obligations between nations. The European Central Bank (see European Monetary System ) was established in 1998 to help formulate the joint monetary policy of those European Union nations adopting a single currency.

banking shares

As well as the banks, British Airways climbed 6p to 208.4p ahead of passenger figures for November due later in the session.

Among other top flight stocks, home improvement retailer Kingfisher gave up gains seen after it revealed like-for-like sales were up 5.7% in the 13 weeks to October 31, driven by higher sales of "big ticket" items and improved DIY performance. Shares were later 0.2p lower at 235.8p, although Homebase rival Home Retail Group still cheered 3.1p to 313.1p.

Outside the top flight, shares in brewer Marston's were 4% higher, up 4p to 93.9p, as the company offset any disappointment over lower full-year profits by reporting an improved sales trend at its managed pubs in recent weeks.

Transport firm Go-Ahead was another stock on the front foot after it announced the disposal of its loss-making aviation services business. Shares were 36p higher at 1264p, even though it warned the move would result in a £20 million hit to results.

bank loans

1. Assess your current financial situation by listing your assets, detailing your monthly income and deducting any liabilities, debts or expenses.

2. Step2

   Ask your employer for a letter confirming your monthly income and job security, and back it up with pay stubs or, if your salary is deposited directly into your bank account, invoice statements.

3. Step3

   Do some shopping. You may or may not qualify to get a personal loan through your regular bank. If you don't, there are dozens of lenders out there who specialize in personal loans.

4. Step4

   Compare not only interest rates, but also repayment terms. Find out if your monthly loan payment is fixed or variable, and opt for a fixed term whenever possible. Ask about any up-front fees, and make sure you know whether the loan is disbursed all at once or in installments.

5. Step5

   Offer collateral to get a lower interest rate. Even if you have excellent credit, an unsecured personal loan will always come at a higher interest rate than a secured one.

6. Step6

   Complete all application materials in full, including supporting documentation listing your assets, liabilities and income.

7. Step7

   Check over the loan documents once they're prepared. The terms you and the lender agreed to should be represented honestly and in good faith in the loan documents. You can sign off on the loan if all items appear as discussed with the lender.

8. Step8

   Repay the loan according to the terms outlined in your agreement. If you default, you risk losing the collateral you offered up to secure your loan. If you have an unsecured loan, failure to make payments will have a profoundly negative impact on your credit rating.