Retail or Consumer Banks
Retail banks — also known as consumer banks — offer banking services to the general public. These include checking, savings and retirement accounts along with consumer loans — such as home and auto loans.
Credit Unions
Unlike most banks which strive to make a profit for shareholders, credit unions are not-for-profit institutions that accept deposits and make loans. They are owned by their members, passing any earnings back to their membership instead of shareholders. Credit union membership is usually limited to people who work or live in a certain area.
Savings and Loan Associations
Also called thrifts or S&Ls, savings and loan associations focus primarily on helping people become homeowners. Federal law limits the types of loans and commercial accounts S&Ls can take part in. But they may offer higher interest rates to depositors to raise money for mortgage loans.
Commercial Banks
Commercial banks are standalone institutions or departments within a bank that focus on corporate, government, small business or nonprofit customers. They tend to specialize in financial products and services tailored to the needs of these large entities.
Community Development Banks
Smaller than commercial banks, community development banks — also called CD banks — focus on their local community. They are typically created to provide financial services including deposits and loans in underserved communities.
Investment Banks
Investment banks provide complex financial services to clients such as corporations, large nonprofits, pension funds and governments. Services may include working as an intermediary in mergers and acquisitions or handling the work needed for a client to take their company public.
Online-Only Banks
Online banks — also known as virtual banks or “neobanks” — provide e-banking services via websites and apps. While traditional banks have digital services, online-only banks have no brick-and-mortar branches. This cuts overhead, allowing the online bank to pass savings to customers.