Personal Banking or Retail banking deals directly with banks providing banking services individual customers. They offer a variety of services including: certificates of deposit (term deposits), mortgages checking and savings accounts, individual loans and more. The consumer demand for bank deposit services in particular allows the banks the available capital to lend. Many retail banks , especially those in small towns, aim to provide a less formal atmosphere.
Some retail banks even sponsor local events and sports teams. It's the goal of retail banks to be a financial one stop shop for their customers. The close relationships these banks have with their customers allows them to make more informed credit decisions.
Though, like all other financial institutions, retail banks have broad credit guidelines to which they adhere to, they also take into account what they know about their customers. Having customers with multiple financial arrangements allows them to gain a more thorough perspective of their financial positions. This also benefits the customer, as having multiple accounts with one bank makes them more valuable.
Often retail banks will offer deals to these valued customers that are difficult to find elsewhere in order to secure their business.