The issuing Bank is the financial institution that issued something. Here we are talking in most cases about issuing credit cards to customers. This definition is valid for the Bank, which carried out the securities issue. In the case of issue currency issuing Bank is the Central Bank of a particular state. In the role of Issuer of the Russian ruble is the Central Bank of the Russian Federation, pound – the Bank of England, the us dollar is the Federal reserve system. Credit card issuers quite often sign agreements with customers with the release of “plastic”. The contract specifies for owners of credit cards certain advantages, in particular, may be permitted withdrawals with cards in ATMs of partner.
Issuing banks are called even and issue. Financial institutions have legitimate concerns and licenses for production and introduction into circulation of banknotes and bonds, payment and settlement documents and financial instruments. The bond issue can only be commercial financial institutions. As payment and settlement documents and financial instruments, there may be documents or items of strict accountability, in particular checkbooks and plastic cards.
Who has the right to issue financial assets?
Right to issue and checkbooks and Bank cards have not only commercial financial institutions, but also state, national. Very interesting is the fact that credit card even after it is handed to the client financial institution, becomes the property of the latter. A financial asset is given for temporary use and after the expiration of the contract it must be returned to the Bank. The inscription on that card is the property of the Bank, can be found on the back of the last.
Relationship between banks
The issuing Bank is a concept that is quite common in the implementation of mutual settlements between the two sides when building business relationships. The parties are referred to as letters of credit. Situation involves the fact that the Bank issuing the letter of credit acts as the executor of the instructions of the payer, who intends to transfer to the financial institution a certain sum on a fixed date and for a complete list of services performed. Settlements can be performed via the Network. For this purpose, the company with which the computation could identify the customer in the relevant forms should indicate the billing address of the issuing Bank and the special CVC2 code.
What is a letter of credit?
The letter of credit acts as a most secure and popular form of mutual settlements between the buyer and seller. This is the format of cashless payments between two counterparties, in which the issuing Bank of the savings Bank (or any other financial institution) in the face of the payer in accordance with the request of the applicant or the payer under the letter of credit undertakes the comprehensive performance obligation settlement with the beneficiary who is the recipient of the material resource by the letter of credit. The amount of funds determined by the letter of credit (with terms inclusive). Letters of credit are widely used in the calculations in the domestic market of Russia. The legal framework is now actively expanding in this direction, an international practice for the development direction. The participants have access to many benefits including the choice of one of the many formats of settlement.
Who can act as an issuer?
In the role of Issuer can be not only a financial institution. The function of issue of the financial asset can be also assigned to the legal entity, the Executive authorities and even local authorities. The only main point that must be present is the existence of the right to issue. In accordance with this standard, the issuing Bank or any other entity engaged in the issue of the financial asset bears full obligation to the owners of securities, including performance of a complete list of obligations to them.
Obligations of the issuing bank
The issuing Bank is a kind of credit institution, acting in the role of a participant of the payment system that has been issuing credit cards. The duties of a financial institution includes the maintenance of all credit cards issued. In addition to maintenance, the financial institution also undertakes a range of duties:
The issuing Bank agrees to comply with all rules that are spelled out in detail in the contract about cooperation with the client. Also, the document contains the obligations of customer. Failure to comply with the terms of the agreement any of the parties to the agreement may be terminated.
Refusal of a bank to issue a credit card
The issuing Bank is the financial institution that can issue credit cards to their customers, and this has already been discussed above. We draw your attention to the fact that the size provided in the amount of debt on the map may not correspond to the customer's request. The limited credit card limit or a complete rejection of cooperation can take place on the basis of a number of reasons:
- Information on the borrower is very small, including the presence of just one contact phone.
- Lack of family and children. It is generally accepted that people who have children are confident of their future and take their obligations more seriously.
- Age. According to statistics, it is customary to give good limits to those people whose age ranges from 25 to 45.
- The existence of seniority and profession. The longer a person works in one place, the more confidence in him. Insurance agents and real estate agents, the abundance of which determines the situation, to meet very stringent requirements.
- The availability of credit. Financial institution not only recognizes the address of the issuing Bank that issued the card previously, he calculates the material load on the client. Checks the performance of the latter obligations.
All these factors and some minor moments have a significant impact on the bank's decision to issue a card and when determining the amount of the loan.
Own emission. And not only.
Issuers can implement not only its own issue, but the issue of assets in the format of securities for other objects. Private emission is strictly regulated by the law on the securities market. Financial institutions may issue registered certificated securities and uncertificated, their version on electronic media, securities, bearer bonds and stocks, securities convertible format.