Other Banking Operations

Learning objectives

After studying this chapter, you should be able to:

1 Understand the legal issues around other bank services such as credit cards, investment advice, safe custody, and automated teller machines

2 Appreciate the evolving legal environment for electronic banking

3 Gain awareness about strategies and remedies that bankers can use to protect themselves and their banks from liability


In addition to bank accounts and negotiable instruments, banks offer many other services, including credit cards, investment advice, safe custody, direct debiting, and automated teller machines. The way these traditional and new services are delivered is also constantly evolving, resulting in platforms such as Internet and mobile phone banking to complement brick-and-mortar banking. All these give rise to legal issues that bankers must know.

This chapter focuses on the legal and regulatory issues around these other bank services and how bankers should approach them, as well as those around new delivery platforms including Internet banking.

Credit Cards

The term “credit card” generally refers to a plastic card assigned to a cardholder with a credit limit that can be used to purchase goods and services on credit or obtain cash advances. Credit cards permit cardholders to pay for purchases made over a period of time, and to carry a balance from one billing cycle to the next.

The most important feature of a credit card is revolving credit. ...

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