Glossary

PID: Payment Incidents Database

BRD: Banking Risk Database

EPS: Electronic Payment System

VISA International: Payment system ensuring the compensation and clearing of funds related to banking cards operations

Foreign currency: National currency of another state

Convertible currencies: The currencies mentioned in the list of exchange rates on the FX market, communicated by the National Bank of Romania

Foreign currency operations: Collections, payments, compensations, transfers, lending, as well as other transactions expressed in foreign currencies, which can be performed via banking transfer, in cash,  by means of payment instruments, or by any other payment methods practiced by credit institutions, depending on the nature of that operation

Foreign currency market: The market where foreign exchange operations are performed by the foreign currency market agents

Foreign exchange operations: Transactions consisting in the buying and selling of foreign currency against the national currency or against another currency

Transaction date: The date on which the transaction is concluded

Currency date: The date on which the transaction is settled

 

Card-Related Glossary

 

Card: an information-bearing support enabling electronic payments; depending on the nature of the physical support of the recorded information, there can be magnetic band cards, chip cards, or hybrid cards (with magnetic band and chip)

 

Debit card: the card through which the holder has at its disposal, for operations, only its own money available in an account opened by the issuer

 

Credit card: the card through which the holder has at its disposal the issuer’s money, offered as a credit line, allowing the holder to perform operations within the limit of a previously established ceiling. The credit card must allow its holder either to fully repay the loan at the end of the period established by the issuer, or to partially reimburse it, while the remaining part will be considered an extension of the previously granted loan
Card Account (hereinafter named Account): Current account opened by the bank, with a legal/natural person as holder (main account holder), reflecting all the card operations performed by the main card holder / authorized card user.

 

Account statement: The document mentioning the operations performed on the card holder’s account during a certain period of time.

 

Overdraft (overdraft facility) – when accessing an overdraft, the client may withdraw cash or perform payments over a certain cash limit existing in its account. The advantage is that the client may use this money whenever necessary, and it is repaid through cash deposits in the account (there is no fixed monthly installment), and the interest to be paid is applied only for the amount of money which was actually used and only for the days when the account was overdrawn

 

ATM:  Automatic Teller Machine used for cash release and completion of other tasks for which it has been programmed.

 

Card operation: The operation performed with the card for the payment of goods / services, or for obtaining cash.

 

PIN: Identification code / personal identification number assigned by the bank to each authorized card user / card holder, to be used in card operations.

 

POS (point of sale):  Bank terminal located with traders (supermarkets, stores, gas stations, etc), connected to a bank’s system through a telephone line, allowing the real-time performance of the authorization, registration and transfer of money directly from the buyer’s account into the seller’s account, when the payment is performed by means of a bank card.

 

Main card holder: Legal or natural person who required the bank to open the card account and to issue a related card.

 

Authorized account user:  Natural person authorized to operate on the account of a legal or natural person’s account through the card.
 

Account-Related Glossary

 

ACCOUNT: The account opened with the bank by the account holder or the legal representative.

 

Client / Account holder: The beneficiary of the amounts from the account.

 

Legal representative: Natural person vested with the right to represent the account holder/client.

 

Account opening fee: Cost charged by the bank when a current account is opened.

 

Account maintenance fee: Cost charged by the bank on certain time intervals, representing the equivalent of the account monitoring.

 

Cash withdrawal fee: Cost charged by the bank when cash is withdrawn.

 

Savings Product-Related Glossary

 

Account balance: Funds available in the holder’s account on a certain date

 

Capital: Amount initially deposited in a bank deposit

 

Maturity of a deposit:  Date on which the created deposit expires.

Usually, it is the date when the account holder can make use of the funds from the deposit and may perform changes: cash withdrawals, change of the deposit maturity, transformation into another type of deposit etc.

 

Deposit period: Time interval needed for a deposit to reach maturity

 

Flat (fixed) interest: Amount of money granted by the bank, the value of which is constant during the entire deposit period

 

Variable interest: Amount of money granted by the bank, which can be modified unilaterally

 

Simple interest: the interest calculated based on the initially deposited funds

 

Accumulated interest: the interest calculated by applying the interest rate to the amount representing the initially deposited capital and the interest obtained for the previous period

 

Annual interest: The amount granted by the bank, calculated on the basis of the deposit period and the currency in which it is created

 

Implicit extension: An option consisting in adding a period of time equal to the initial one established without the need to close the deposit

 

Capitalization: Adding an amount representing the interest previously obtained to the initially deposited capital, which amount will be the basis for the calculation of the deposit interest

 

Minimum mandatory monthly deposits: Fixed amounts established by the account holder or legal representative at the moment when the account is opened and which are transferred every month from the current account into the savings plan

 

Implicit transfer: The monthly feeding of the savings plan by debiting the current account, performed by the means of a standing order

 

Standing order: The transfer of the amounts, performed from the current account into other accounts on the date and in the conditions indicated by the account holder or legal representative

 

Lending Product-Related Glossary

 

Interest: the price which must be paid for borrowing (using) an amount of money for a certain period of time

 

Interest rate: the percentage level applied to the borrowed capital during the period of the loan

 

Annual effective interest rate DAE:  shows the real cost of a consumer loan, taking into account not only the interest rate expenses, but also the other taxes, fees and certain insurances which must be paid by the client. DAE is calculated according to the calculation formula provided by the law, taking into account also the period in which the bank’s client will bear such costs.

 

ROBOR: the average reference level of interest rates for the deposits in lei upon various terms offered on the interbank market in Romania, as displayed on the reference date, valid for that particular day, on the related page of the Reuters service, as well as in the specialty press

 

EURIBOR stands for European Interbank Offered Rate and it is an internationally recognized independent reference index, representing the minimum or basic interest rate communicated by the European Central Bank for loans granted in Euro by a first rank bank to another first rank bank (established at 11 o’clock a.m., Brussels time).

 

LIBOR: the average reference level of interest rates at which international banks offer deposits in USD for different deadlines, on the London money market.

 

IRCC: Quarterly reference indicators (reference index for consumer credit, shortly IRCC) - used for consumer loans and mortgages offered to private individuals in national currency, available starting with 2^nd of May 2019: Referral indicator for loans granted in LEI with variable interest rate will be published daily on the website of the National Bank of Romania and it represents the calculated interest rate as an average of the interest rates together with the volume of transactions registered on the interbank market. The reference indicator is calculated quarterly, as the average of all daily interest rates registered for the previous quarter and it will be applied for the next quarter.