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

advantages and disadvantages of process costingadvantages and disadvantages of mixed economy systemdifference between accounts receivable and payabledebit card wikisubvention meaningcomplements and substitutes economicsadvantages and disadvantages of coaching leadership styledisadvantages of delegation of authoritykyc abbreviation financeadvantages and disadvantages of capitalist economywikipedia in hindi narendra modiwhat is the meaning of trial balancemerits of cost accountingdifference between inferior and superior goodsdiscounted cash flow advantages and disadvantageswhat is vertical mergerunbilled salesreceive cash on account journal entrypricing skimmingwhat are the advantages and disadvantages of bank loansadvantages and disadvantages of joint ventureswhat is law of diminishing returns in economicswhat is privatization and commercializationadvantages of vertical organizational structureimplicit cost and explicit costofs in stock marketdifference between macro and micro economywhat is conglomerate in economicsinferior goods economicsautocratic decisionproduct bundle pricing strategysemi durable goods definitionscarcity examples in economicsbenefits of jit manufacturinginternational joint venture advantages and disadvantagesdisadvantages of variable costingfeatures of globalisationmerits of capitalismpaid rent for the month journal entrytypes of price elasticity of demand with examplesmonopolisticsswot stands fordiscounting bill of exchangeforeign trade advantages and disadvantagesunearned revenue accountingfull form of cfa coursedifference between macro and micro economyfunctional organizational structure advantages and disadvantagesstrengths and weaknesses of market economymerit of capitalismcost of deflationexamples of capital receiptsexplicit cost examplemonopolistic economy definitionadvantages and disadvantages of oligopolyfull form of tds in bankingexample of cost push inflationmeaning of laftrial balance is preparedcompare and contrast socialism and capitalismnatural resources advantages and disadvantagesvarious types of elasticity of demandstrengths and weaknesses of traditional economyadvantages and disadvantages of oligopolydisadvantages of mixed economyskimming costpenetration pricing advantages disadvantageswhat is the meaning of demand draftwhat is the full form of kpmgfullform of impsfdi abbreviationunclaimed dividendscibil bankgoing concern accounting conceptliquidity ratios listcapital receipts examples