Nowadays virtually everyone over the age of eighteen has a bank account and most employers pay wages and salaries straight into employees’ current accounts rather than hand it to them in a brown envelope. The kind of bank account that most people have is known as a personal or current account. Private banking on the other hand is a type of banking facility that the banks offer to those customers who have plenty of money and/or sizeable assets.

Most people are offered a banking service that is no more personal than dealing with the checkout person at the supermarket; it is a form of mass market banking, especially when compared to the more personal service that is private banking. Private banking is the exclusive preserve of the very rich, those people who have more than 2 million pounds in liquid assets, although there are some banks that will allow a private investor with only a quarter of a million pounds in assets to have a private bank account. Banking officials often refer to high level personal accounts as ‘wealth management.’

 

There is a bit of a dark side to private banking in that the accounts can sometimes function as a means for that person to avoid paying income tax. A good deal of private banking takes place abroad and people will often put their money in Swiss bank accounts or other, offshore accounts in order to keep the full details of their wealth private, and to avoid paying any tax.