OSCB Banking Assistant key terms

The process by which financial institutions exchange and settle payment instructions between the payer's bank and the payee's bank, confirming that funds actually move and the transaction becomes final.

The final transfer of funds between institutions that discharges the obligations created by a payment, completing what clearing began and making the money available to the recipient.

The interval during which funds are recorded in one account but not yet available in another, created by processing delays in clearing and settlement.

The date on which funds are treated as credited or debited for interest and availability purposes, which may differ from the date the transaction was entered.

The daily deadline after which a transaction is held and processed on the next business day rather than the current one, affecting when funds become available.

A payment, such as a cheque or direct debit, that the paying institution refuses to honour and sends back, for example because of insufficient funds, a stop payment, or a closed account.

The condition in which an account balance cannot cover a presented payment, leading the institution to decline or return the item and typically charge a fee.

A negative account balance created when the institution pays an item for more than the available funds, either as an authorised facility with agreed terms or as an unarranged balance.

The portion of an account balance the customer can actually withdraw or spend at that moment, after holds, pending transactions, and uncollected funds are taken into account.

The recorded book balance of an account at the start of the business day, before pending items and holds are applied, and therefore often different from what the customer can spend.

The control process of comparing internal records with external statements or system reports to identify and explain differences, ensuring that balances and transactions are accurate and complete.

A temporary holding account used to record funds or entries that cannot yet be allocated to the correct customer or general ledger account, pending investigation and clearing.

The chronological record of who did what, when, and from where in a system, allowing transactions and changes to be traced and verified after the fact.

A control that divides sensitive tasks among different people so no single individual can initiate, approve, and conceal a transaction alone, reducing error and fraud risk.

The requirement that a sensitive action be reviewed and approved by a second authorised person before it takes effect, providing an independent check on the first person's work.

A safeguard in which two people must act together, such as with separate keys or credentials, to complete a high-risk task like opening a vault or releasing a large payment.

The mandatory process of identifying a customer, verifying their identity with reliable documents, and understanding their financial profile and expected activity before and during the relationship.

The ongoing risk-based measures an institution applies to confirm customer identity, understand the purpose of the relationship, and monitor activity in proportion to assessed risk.

Additional scrutiny applied to higher-risk customers, such as politically exposed persons or those in high-risk jurisdictions, including deeper source-of-funds checks and more frequent review.

The natural person who ultimately owns or controls a legal entity or arrangement, identified by ownership thresholds or control, even when the account is held in another name.

A person entrusted with prominent public functions, or a close associate or family member, who presents higher corruption risk and therefore triggers enhanced due diligence and senior approval.

A confidential filing to the financial intelligence unit reporting activity that may indicate money laundering, fraud, or other crime, made without tipping off the customer involved.

Deliberately splitting transactions into smaller amounts to stay below reporting or monitoring thresholds, which is itself a criminal offence regardless of the origin of the funds.

The process of disguising the origin of criminal proceeds through placement, layering, and integration so the funds appear legitimate and can be used openly.

Disclosing to a customer or third party that a suspicious activity report has been or may be filed, which is prohibited because it can compromise investigations.

The documented origin of the specific money involved in a transaction or relationship, which staff must establish and evidence, particularly for higher-risk or unusual activity.

The explanation of how a customer's overall net worth was accumulated, such as through salary, business sale, or inheritance, distinct from the origin of a particular payment.

A social-engineering attack in which a criminal impersonates a trusted party through email, text, or a fake website to trick a person into revealing credentials or authorising a payment.

A voice-based social-engineering attack in which the caller impersonates a bank, police, or other authority by telephone to pressure a victim into transferring money or disclosing security codes.

A phishing attack delivered by text message or messaging app, often containing a link or a request for a one-time passcode that leads the victim to a fraudulent site.

Manipulating people through deception, urgency, or authority to obtain confidential information or persuade them to take actions that harm themselves or the institution.

Creating a fabricated scenario or false identity to extract information from a target, such as a caller posing as an internal auditor requesting account details.

A single-use code sent to a customer's registered device or token to confirm a transaction or login, which must never be shared with anyone, including someone claiming to be bank staff.

Fraud in which a criminal gains control of a customer's account, often through stolen credentials or intercepted codes, then changes contact details and moves funds.

A scam in which the victim is deceived into instructing their own bank to send money to a fraudster's account, so the payment is genuinely authorised by the customer.

A reversal of a card or payment transaction initiated through the payment scheme after a customer disputes it, for example for fraud, non-delivery, or an incorrect amount.

A temporary restriction that prevents a customer from withdrawing deposited funds until they are confirmed collected, commonly applied to large or unusual deposits.

A customer instruction that prevents a specific cheque or pre-authorised payment from being paid, which must be actioned promptly and before the item is presented.

Interest calculated on both the original principal and previously accrued interest, so the balance grows faster than with simple interest over the same period and rate.

A standardised figure showing what the interest rate would be if compounded once a year, allowing customers to compare savings products on a like-for-like basis.

The standardised cost of borrowing expressed as a yearly rate, including specified fees, used to compare credit products on a consistent basis.

A numerical summary of a person's credit history, derived from repayment behaviour, existing debts, and other factors, used by lenders to assess the likelihood of repayment.

A lender's evaluation of whether a borrower can realistically repay credit from income and assets without undue hardship, required before most regulated lending decisions.

An asset pledged by a borrower to secure a loan, which the lender may seize and sell if the borrower defaults, reducing the lender's loss.

The loan amount expressed as a percentage of the pledged asset's value, used to gauge lending risk; a higher ratio generally means greater risk and stricter terms.

A borrower's failure to meet repayment obligations under the loan agreement, which can trigger penalties, demand for full repayment, or enforcement against collateral.

The amount of overdue payments a borrower has failed to make by the agreed dates, tracked by the lender and often reported to credit reference agencies.

A temporary arrangement in which a lender agrees to reduce, delay, or restructure payments for a borrower in difficulty, usually with conditions and a review date.

A customer whose circumstances, such as illness, bereavement, low literacy, or financial difficulty, make them less able to understand or act in their own best interests, requiring tailored support.

The structured process for recording, investigating, and resolving a customer's expression of dissatisfaction, with defined timeframes, escalation routes, and referral to an ombudsman where unresolved.

Investigating why a problem occurred rather than only fixing the symptom, so that recurring complaints or errors are addressed at their source and prevented.

A situation in which a person's personal interests or duties to another party could improperly influence their professional judgement, which must be disclosed and managed.

The principle that firms must deliver outcomes that are fair and appropriate for customers, covering product design, clear information, suitable advice, and after-sales support.

The requirement that a recommended product or service matches the customer's objectives, circumstances, and risk tolerance, supported by documented information gathered from the customer.

The structured record of a customer's financial position, goals, and preferences gathered before advice is given, forming the basis for a suitability assessment.

Fully concentrating on a customer's words and meaning, reflecting back and clarifying to confirm understanding, rather than planning a reply while the other person speaks.

A question that cannot be answered with yes or no and invites explanation, used to gather fuller information and encourage the customer to describe their situation.

The privacy principle of collecting and retaining only the personal data actually needed for a stated purpose, reducing exposure if records are lost or misused.

A person's legal request to see the personal data an organisation holds about them and certain related details, which must be answered within the statutory deadline.