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Banking transactions

Part of the banking transactions are regulated by Chapter 29 of the CA - credit, bank credit, bank guarantee; another part - a common legal framework in the LCI - factoring, discount transactions, foreign exchange, here belongs Art. 2 LCI, as well as transactions in financial instruments. There are different types of banking transactions that can be classified with reference to the following criteria:

1. Participation of the bank as part of the transaction:

  • Passive banking transactions - transactions in which the bank attracts foreign cash and has the capacity of a debtor (contract for deposit);
  • Active banking transactions - transactions where the bank as a lender disburses funds to customers (bank loan);
  • Intermediary bank transactions - these transactions leave the bank’s property unchanged. They include the so-called cash collections, letters of credit transactions, transferring transactions, escrow transactions.

2. Depending on who can enter the relevant transactions:

  • Exclusive banking transactions - may be concluded only by a commercial bank. These are typically bank deposits, bank credits and bank guarantees.
  • Non-exclusive banking transactions - transactions that can be carried out by a commercial bank and financial institutions. These include financial leasing, factoring, discount transactions, foreign exchange, transactions with financial instruments, lease of safe and others.

3. According to the need for formalities:

  • Formal;
  • Informal - they are exceptions, such a contract is a letter of credit.

4. According to the point from which the transaction is deemed concluded:

  • consensual - contract for business credit;
  • real - deposit of securities.

5. The general division of transactions:

  • causal - most transactions;
  • abstract - as such are considered the letters of credit and possibly bank guarantees.

The majority of banking transactions contain the so-called cashless payment. It is defined as a system of deals and actions through which cash payment obligations are borne, amended or terminated under the accounts of the payer and the payee. The Payment Services and Payment Systems Act contains a legal definition of the term payer - this is a person who arranges a payment or whose payment account is debited with his consent. The payee is a person to whom the payment is issued or whose payment account is credited. Several classifications of cashless payments can be found in legal literature:

  • according to the spatial criteria when making cashless payments:
  • local and remote cashless payment
  • depending on whether the actions are documented on paper or not:
  • paper-based and electronic
  • depending on whether the payment is predetermined by a condition:
  • conditional and unconditional payment
  • depending on how many banks participate in the cashless payment:
  • intrabank and interbank payment where the payment accounts of the payee and the payer are in different banks.

Banking transactions

1. The loan agreement: legal framework - CA and LCI

The legal definition of a bank loan agreement is contained in the CA - a contract under which the Bank undertakes to grant the borrower a certain sum of money for a particular purpose under agreed upon terms and conditions, and the borrower is obliged to repay the amount along with the relevant interest.

2. Bank deposit: legal framework - CA, Art.420 ff

There are three types of bank deposit:

  • ordinary deposit - Art. 420 CA - this agreement provides that the depositor gives the bank cash, securities and other movable goods to keep for consideration;
  • cash deposit - according to the CA, subject of a cash deposit are only currency that the depositor provides, and the bank is obliged to return the deposit in the same amount and the same currency with interest;
  • CA allows for a simple contract for deposit to be accompanied by a governance clause.

3. Bank guarantee: legal framework - CA, the bank is obliged to pay the person specified in the bank guarantee (BG) a specific amount, under the conditions provided for therein.

4. Bank Transfer

A form of cashless payment, belongs to credit payments, the payment can be a large amount or a small amount; intrabank or interbank; local or remote; paper-based or electronic.

5. Letter of credit - a form of payment under which arises a relationship between 3 parties:

  • originator - payer in the currency relationship to whom TB is obliged to issue a letter of credit;
  • beneficiary - person in favor of whom the letter of credit is issued - the person who is entitled to certain rights under the letter of credit, the recipient of the payment in the currency relationship;
  • issuer - TB, which performs payment under the letter of credit - the letter of credit bank.

Three transactions are concluded: between the originator and the beneficiary, contract for the issuance of a letter of credit - relationship between the originator and the TB-issuer, the letter of credit itself, objectifying the relationship between the TB-issuer and the beneficiary.

6. Lease of safe - legal framework - TB, Art. 2 CIP; agreement by virtue of which the lessor is obliged to provide for consideration and for a certain time period the use of safe in a secure storage facility for valuables, securities, documents and other movables (in practice referred to as Public Treasury).

7. Banking cash collection - legal framework - CA, PSPSA, Uniform Rules for Cash Collections, adopted by the Chamber of Commerce in Paris. Cash collections represent the recovery of a claim against the relevant bill of exchange; a form of debit payment - generally non-cash, but it may be combined with cash.