When it comes to banking, there’s a lot more to know than what meets the eye. Banking isn’t just about saving money in an account, getting interested, and withdrawing it. Not all banks and institutions are created equal. Different banks also have different services.
Some banks cater to people while some cater to companies. Whether you’re planning a career in the banking sector or you’re just curious, a little knowledge can help you understand how the system works.

National Banks
A national bank is a bank that’s been federally chartered by the government of United States of America. National banks are insured by the Federal Deposit Insurance Corporation. They offer any and all financial services that you can think of.
From checking and saving accounts, to money card services and offering loans and insurance, national banks have them all. Some banks that belong to this category are Bank of America, Citibank, PNC Bank, and Capital One.

Retail Banks
Retail banks offer consumer services directly to individuals. One of these services includes opening checking or saving accounts. They also offer credit card or debit card services. They also have loan and retirement services. As you can see from the name, these banks are helping individual customers with their banking services. A retail bank can be a local bank with no other branches as well. It can also be a branch of a commercial bank or local bank set up to provide services at a regional level.

Commercial Banks
Commercial banks offer products and services like fundamental investment schemes, business advances, bond investment schemes, overdraft facilities, and mortgage loans. These are profit-making enterprises. They offer the same services like retail banks. But commercial banks focus on businesses as customers. They can also offer short term loans.
Before the Great Depression, all commercial banks in the US were considered to be investment banks. After the banking system collapsed in 1929, the need to limit the operations of banks to one kind either investment or commercial arose.
In other countries, there are two types of commercial banks:
Public commercial banks, which are usually government owned. Their objective is overall development.
Private commercial banks which run solely on the motive of profit.

Investment Banks
An investment bank is a financial institution that handles securities transactions for their clients. They run on the revenue they get by doing transactions. This includes mergers and acquisitions, derivative trades, foreign money transactions, equities, and fixed-income instruments.

Central Bank Or The Federal Reserve
Like most other countries, USA has its own central bank. The Federal Reserve, or Fed, looks after all the banks and institutions in the country. Its work includes printing currency, helping other banks during monetary crises, protect everyone’s money, punish banks and other financial institutions for any kind of fraudulent behavior etc. They are a politically free entity and work independently.