Difference between Retail and Wholesale Banking

Those days are gone when banking referred to only one thing that is a place where savers can deposit money and borrower take loan when they are in need of funds, however nowadays banking has changed completely and it encompasses many things. Retail and wholesale banking are two of them; let’s look at some of the differences between retail and wholesale banking –

Retail and Wholesale Banking Differences


Retail banking refers to that banking which targets individuals and the main focus of such banks is retail customer whereas wholesale banking refers to that banking which targets corporate or big customers and their main focus is providing services to corporate clients.

Ticket Size of Loan

Ticket size of loans given in retail banking is low and due to it impact of NPA will be less pronounced due to diversification as compared to wholesale banking where ticket size of loan is very high and due to it impact of NPA is more pronounced.


Loans such as car, housing, educational, personal loans are some of the examples of loans given in retail banking whereas loans such as loan for setting industry, machinery advance, export credit are some of the examples of loans given in wholesale banking.

Monitoring and Recovery

Monitoring and recovery if the loan turn out to be NPA in retail banking is more difficult because customer base is wide whereas in case of wholesale banking due to low customer base it is easy to monitor as well recover the loan given to customers.

Interest Rates

Cost of deposit is low in retail banking because retail customers do not have the bargaining power due to less deposit with them whereas in case of corporate customers banks have to offer them high interest rates in order to attract funds from them.

Operational Costs

Retail banking requires large network of branches in order to cater to large customer base and hence it results in high operational costs while in case of wholesale banking small number of branches is sufficient to cater to corporate clients.

As one can see from the above that retail and wholesale banking are very different from each other and that is the reason why many banks have separate branches for retail business and wholesale business.

0 comments… add one

Leave a Comment

Related pages

journal entry for bills receivablecrossing the chequewhat consignee meansgatt full formwhat is the definition of current liabilitiesskim pricingadvantages and disadvantages of mergers and acquisitionsprovision accounting entriesdisadvantages of cost accountingmeaning of direct and indirect expensesmerger horizontaldemand push inflationunbilled deferred revenuehorizontal integration disadvantagesadvantages and disadvantages of capitalist economic systempros and cons of mixed economic systemmeaning of skimming pricingdisadvantages of living in mexicoadvantage and disadvantage of traditional economyadvantages and disadvantages of capitalist economic systemdebentures as a source of financefeatures of mixed economy systemsubstitute goods examples economicsfloating exchange ratescapital account journal entrymonopolistic competitive market exampleswhats a conglomeratefeatures of capital budgeting decisiondescribe a traditional economyexample of congeneric mergerhow do we complete a horizontal and vertical analysisliquidity ratios listjunk bonds meaningwhat are the advantages of globalisationmonopolistic companyaccounting entry for prepaid expenseswhat is free market economy advantages and disadvantagesexamples of assetsdefine penetration pricingcalculating net worth of a companyfinance payback periodpricing strategies skimmingdifference between vertical and horizontal analysishow is crr calculateddifference between debentures and sharesmerits of market economylifo benefitsdefine a mixed economyunearned income accountingautocratic management styleszero based budgeting advantagesdisadvantage of social networkingcalloption putoption.comcross rate formulaventure capital pros and consdebit the receiver and credit the giverfictitious asset meaningmerit and demerit of deregulationadvantages and disadvantages of hedge fundsadvantages and disadvantages of equity sharesadvantages and disadvantages of developing countriesplanned economies exampleshedgers in derivative marketthe materiality principletypes of cheques pdfwhat is the difference between a monopoly and an oligopolymonopolistic competitive market examplesbhel company in indiatypes of price elasticity of demand with graphsadvantages and disadvantages of markup pricingconglomerate corporationaccounting entries for purchasesindirect expenses definition accountingmarginal costing approachsystematic risk vs unsystematic riskmeaning of demand loanexamples of indirect quotations