These common terms may be helpful as you bank with NSB. Questions? Contact a Business Banker.
The online capability to electronically collect funds or make payments from or to business or personal accounts at a U.S. financial institution, usually with next day settlement.1
See variable rate.
The process of reducing debt through regular installment payments of principal and interest that will result in the payoff of a loan at its maturity. 2
A percentage rate reflecting the total amount of interest paid on a deposit account based on the interest rate and the frequency of compounding for a 365-day year. 2
A bank’s policy as to when deposited funds will be available for you to withdraw. 2
The difference between the present balance of the account and credit limit assigned to your account. 2
Under bankruptcy law, the legal proceedings by which a bankrupt person’s affairs are turned over to a trustee for administration. 2
Secure online banking tools to help simplify business processes, such as transmitting payroll and conducting wire transfers.
Cash deposits or checks that have been presented for payment and for which payment has been received. 2
A payment that is electronically deposited into an individual's account at a depository institution. 2
See Online Banking.
A system to pay local, state or federal taxes without leaving your home or office.
The transfer of money between accounts by consumer electronic systems-such as automated teller machines (ATMs) and electronic payment of bills-rather than by check or cash. (Wire transfers, checks, drafts, and paper instruments do not fall into this category.) 2
An account established to pay bills during a loan period such as taxes, insurance premiums, and other charges upon their due date.
Funds held by a third party on behalf of two other parties in a transaction until it receives written or oral instructions or obligations have been fulfilled. 2
An executor, administrator, guardian, conservator, or trustee for a family trust, authorized trust, or testamentary trust, or receiver or trustee in a bankruptcy. 2
A consumer’s ability to place a fraud alert on their credit record if they believe they are a victim of identity theft. The alert requires any creditor to contact the consumer by phone and verify that the credit application was not made by an identity thief. 2
A legal process that allows a creditor to remove funds from your bank account to satisfy a debt that has been unpaid. 2
A party who agrees to be responsible for the payment of debt of another party if they default. 2
An amount of a customer’s balance may not be withdrawn until an item has been collected, or until a specific check or debit is posted. 2
A Remote Deposit Capture (RDC) solution for the fastest, greenest, easiest way to deposit checks: no deposit slips, no photocopying checks, and no need to visit the bank. All you need is a desktop scanner and secure internet connection.
An inadequate checking balance in a depositor’s account to pay a check presented for payment. 2
The amount paid by the bank to the depositor based on a percentage of your account balance.
The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. 2
Letters of Credit are a loan product that guarantees performance, either financial or operational. The financial institution ensures a payment will be made to the beneficiary for a specific transaction, provided the conditions of the letter of credit are met.
A legal claim against personal or real property. The lien holder is paid the amount that is owed once the property has been sold. 2
Use a line of credit to borrow cash up to the borrowing limit established by the bank, and pay interest on the outstanding monthly balance only. Each time you pay back principal, money is freed up again for future loans. Typically, the financial institution will ask for a personal guarantee and secure the loan with business assets. 1
A contractual agreement that allows the borrower or lender to permanently change one or more of the terms of the original loan contract. 2
A ratio of the amount borrowed on a loan (principal) to the value of an asset. 2
Directs payments to a financial institution, rather than directly to a company, to process and deposit funds into the company’s account.
A checking account that does not have enough money in it to cover pending or presented transactions. 4
This service allows an account holder to obtain account information and manage banking transactions through financial institution websites, via computer, tablet, or phone. 2
Common acronym for principal, interest, taxes, and insurance—used when describing the monthly charges on a mortgage. 2
Reduces losses due to fraud and forgery by giving an account holder the opportunity to review all checks online that do not match their check issue data, providing proactive versus reactive fraud prevention. The account holder provides the bank with an electronic file of checks issued each time their company issues checks. Each business day, the financial institution reports any checks that do not match the check number and amount in the check issue file. The account holder then notifies the financial institution online whether to pay or return each reported exception. The financial institution provides an online audit trail showing all items posted to the account and those returned. 1
A debt instrument that contains a written promise by one party to pay another party a definite sum of money. 5
A second loan is taken out to pay off the first, higher-rate loan to obtain a better interest rate, lower payments or to borrow cash on the equity that has built up on a loan. 2
Account holders deposit and scan checks using a supported desktop scanner and secure Internet connection to submit deposits electronically. RDC systems verify image quality before checks are released to the bank. Complete deposit information and images are available through online reporting. 1
Interest that continues to accrue on your credit card balance from the statement cycle date until the bank receives your payment. 2
A credit agreement that allows you to borrow against a preapproved credit line when purchasing goods and services. 2
Licensing agency for the state of Vermont to register a business.
A method of sharing information that safeguards data in transit using layers of digital protection.
A set of statutes to provide consistency among commercial laws in various states. 2
Depending on your number of employees, owners and company policies, Business Online Banking lets you set up multiple users with different responsibilities.