Types of communication used in Banks

Before the “types of communication used in banks” we discuss what communication is.
Communication

The term communication is derived from original Latin word “ Communis ” which means
common. It involves act of importing a common idea or understanding the other persons and
covers any behavior that effect on exchange of message.
So, communication means conveying the message from one place to another place to one person
to another person.

Business Communication
The process of transmitting the message from sender to receiver so, that the receiver is able to
understand the message clearly. These should be some feedback from receiver is able to
understand the message clearly. There should be some feedback from receiver because the
communication is considered effective when it achieves the desired reactions from recipient.
OR
Business Communication is any communication used to promote a product, service, or
organization – with the objective of making sale.

In business communication, message is conveyed through various channels of communication

including internet, print (publications), radio, television, outdoor, and word of mouth.

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 Types of Communication used in Banks
There are two types of business communication in an organization:

1. Internal Communication
2. External Communication

Internal Communication

It means communication within an organization is called “Internal Communication”.

It includes all communication b/w the different levels peoples within an organization. It may be
informal or a formal function or department providing communication in various forms to
employees.

Effective internal communication is a vital mean of addressing organizational concerns. Good

communication may help to increase job satisfaction, safety, productivity, and profits and
decrease grievances and turnover.

Under Internal Business Communication types there come;

a) Upward Communication
b) Downward Communication
c) Horizontal/Literal Communication
d) Diagonal communication

a) Upward Communication
Upward communication is the flow of information from subordinates to superiors, or from
employees to management. Without upward communication, management works in a vacuum,
not knowing if messages have been received properly, or if other problems exist in the
organization. Such feedback to higher authorities may be in the form of complaints, suggestions,
reports, opinions etc. Upward Communication is a mean for staff to:

 Exchange information.

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 Offer ideas.

 Express enthusiasm.

 Achieve job satisfaction.

 Provide feedback.

Note: B.D.O Stand for (Business Development Officers)

b) Downward Communication
Information flowing from the top of the organizational management hierarchy and telling people
in the organization what is important (mission) and what is valued (policies).Downward
communication generally provides information about the system, objectives plans, procedures,
practices which allows a subordinate to do something.

e.g.: Instructions on how to do a task.

Downward communication comes after upward communications have been successfully

established. This type of communication is needed in an organization to:

 Transmit vital information

 Give instructions

 Announce decisions

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  Seek cooperation

 Provide motivation

 Increase efficiency

 Obtain feedback

Both Downward & Upward Communications are collectively called “Vertical Communication”

c) Horizontal/Literal communication

Horizontal communication normally involves coordinating information, and allows people with
the same or similar rank in an organization to cooperate. Communication among employees at
the same level is crucial for the accomplishment of work. Horizontal Communication is essential
for:

 Solving problems.

 Accomplishing tasks.

 Improving teamwork.

 Building goodwill.

 Boosting efficiency.

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c) Diagonal Communication

It means communication occurs between workers in a different section of the organization and
where one of the workers involved is on a higher level in the organization.
For example in a bank diagonal communication will occur when a department manager in head
office converses with a cashier in a branch of the bank based on the high street.

External Communication
Communication with people outside the company /organization is called “external
communication”. Supervisors communicate with sources outside the organization, such as
vendors and customers. It leads to better;

o Sales volume
o Public credibility
o Operational efficiency
o Company profits

It should improve

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 o Overall performances.
o Public goodwill.
o Corporate image.

Ultimately, it helps to achieve

o Organizational goals
o Customer satisfaction

Other Types of Communication

a) Formal Communication
b) Informal Communication

a) Formal Communication

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In this type of communication in which all the official orders, instructions and messages are
routed through hierarchical channels. The authority and responsibility relationships will also be
formal in this communication. Most formal communication will be in writing but formal
communication is not flexible.

b) Informal Communication
Besides general formal communication, there will be many informal communication channels in
an organization. They are not officially recognized or routed through established channels most
such channel can be developed through the informal interaction of groups in an organization.
Informal communication does not function in a predetermine authority & responsibility
relationship.

Methods of Communication used in Banks

There are three methods of communication used in banks which are represented in above
diagram.
Diagram

Verbal Written
Communication Communication

Communication

Gesticulation

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 1) Verbal Communication
2) Written Communication
3) Gesticulation

1) Verbal Communication
It means conveying the message, idea, facts information in which words are used. It is face to
face type of communication. It can also be made through mechanical devices like telephone,
mobiles, dictating machines (type writer) etc in banks verbal communication is popular both for
upward & downward communication. Instructions, letters, lectures, orders are done through
verbal communication. It helps getting quick response & feedback & develops friendly
environment.

2) Written Communication
It is most important medium of communication. Different kinds of orders, circulars, handbooks,
reports are provided only through written communication. It should be drafted clearly, correctly,
completely and convincingly to make it effective.

3) Gesticulation
Gesticulation is a method supplementary to verbal communication. A handshake, a pat on the
back, can be effective gesticulation, communicating appreciation or praise.

Text References
Drucker, Peter F. The frontiers of management, London 1986 in the world of corporation
manager, New dehli, 1996.
Styles, L R Managerial Behavior, McGraw Hill New York 1997

Web
www.wikipedia.org
www.google.com
www.docstick.com

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