A bank charge is a fee assessed to an account by a financial institution. A bank charge may be levied for a number of reasons, including the following:
Not maintaining a minimum balance
Issuing a not sufficient funds check
Depositing a check that bounces
Exceeding the overdraft limit on an account
The passage of time, if there is a monthly service fee
The ordering of additional bank checks
Foreign transaction fees
The issuance of a paper bank statement, rather than an on-line one
The manual handling of transactions by a bank teller
Inactivity in an account
Bank charges can be a major source of income for a financial institution.
A business that incurs bank charges will usually record them as expenses as part of its monthly bank reconciliation process.