Difference Between Retail Banking and Consumer Banking

Both retail banking and consumer banking are services of a bank provided to their customers with some additional facilities for their customers to keep their money safe in banks.

Retail Banking vs Consumer Banking

The main difference between retail banking and consumer banking is that in retail banking, the customers that enjoy the facilities of retail banking are retail customers from the retail industry, and on the other hand, in consumer banking, facilities of consumer banking are enjoyed by common individuals, the general public, business, institutions, NGOs, etc.

Retail Banking vs Consumer Banking

Retail banking is also known as private banking, where people of high net worth and income have the facilities of making their account in them.

Consumer banking is also known as personal banking, where people having a commonwealth and salary have the facilities of making an account in such banks.

Comparison Table Between Retail Banking and Consumer Banking

Parameters of ComparisonRetail BankingConsumer Banking
MeaningIt helps in providing services and products to its retailing customers relating to increasing their business.It is a financial institution that provided Facilities and services to customers having a minimum income.
Services providedThey provide services such as ATM, having an RD account, access to business loans, etc.They provide services related to giving debit and credit cards and access to NEFT banking.
Other nameThe other name for Retail banking is Private Banking.The other name for consumer banking is Personal Banking.
Customer typeCustomers of a Retail bank are usually people with a high net-worthCustomers in consumer banking are usually people with a normal saving account.
Main functionThey help in the improvement and liquidity of the money of an individual or an entity.They help their customers to get loans and other card and online banking facilities.

What is Retail Banking?

Retail banking is also known as private banking, where people of high net worth and income have the facilities of making their account in them.

Retail banking offers facilities such as access to an ATM card, mobile banking, RD account, etc. Retail banking is often said to be a form of commercial banking that focuses on giving services to its customers.

Local people prefer retail banking more as they are more into business. Hence, retail banking is very efficient for their growth in their business of local people. Retail banks help in increasing the liquidity and money supply.

retail banking

What is Consumer Banking?

Consumer banking is also known as personal banking, where people having a commonwealth and salary have the facilities of making an account in such banks.

In consumer banking, the banks provide facilities such as access to internet banking, debit card, initiating a credit card balance, access to a feature of NEFT, etc.

The main function that is performed in consumer banking is that they provide facilities on credit to a consumer banking customer.

consumer banking

Main Differences Between Retail Banking and Consumer Banking

  1. Customers in retail banking include individuals of high net worth, institutions, businesses, etc., and on the other hand, customers in consumer banking include individuals with a normal savings account, retired individuals, students, etc.
  2. The main function that is performed by a retail bank is that they improve the supply and liquidity of money for increasing the business of their customers, and on the other hand, the main function performed by a consumer bank is that it helps in providing loans on credit basis for their customers.
Difference Between Retail Banking and Consumer Banking

Conclusion

Both retail banking and consumer banking are services of a bank provided to their customers with some additional facilities for their customers to keep their money safe in banks.

A person wanting to create a bank account in a bank must be aware of the differences between retail and consumer banking.

Even though they have their similarities, their differences lie in the functions they perform, on the facilities and products they provide to their customers.

References

  1. https://www.sciencedirect.com/science/article/pii/S0378720601000970
  2. https://onlinelibrary.wiley.com/doi/abs/10.1002/cb.46
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