Fee Income

AAA

DEFINITION of 'Fee Income'

Revenue taken in by financial institutions from account-related charges to customers. Charges that generate fee income include non-sufficient funds fees, overdraft charges, late fees, over-the-limit fees, wire transfer fees, monthly service charges, account research fees and more. Credit unions, banks and credit card companies are types of financial institutions that earn fee income.

INVESTOPEDIA EXPLAINS 'Fee Income'

Financial institutions earn a significant portion of their income from fees, also called non-interest income. Interest income, which is money earned by lending out customers' deposits in the form of mortgages, small business loans, lines of credit, personal loans, student loans and by allowing customers to carry a credit card balance makes up another significant portion of financial institutions' income.



RELATED TERMS
  1. Income

    Money that an individual or business receives in exchange for ...
  2. Non-Sufficient Funds - NSF

    An acronym used in the banking industry to signify that there ...
  3. Non-Interest Income

    Bank and creditor income derived primarily from fees. Examples ...
  4. Net Interest Income

    The difference between the revenue that is generated from a bank's ...
  5. Credit Limit

    The amount of credit that a financial institution extends to ...
  6. Annual Percentage Rate - APR

    The annual rate that is charged for borrowing (or made by investing), ...
Related Articles
  1. How To Break Up With Your Bank
    Options & Futures

    How To Break Up With Your Bank

  2. Entrepreneur Vs. Small Business Owner, ...
    Investing Basics

    Entrepreneur Vs. Small Business Owner, ...

  3. How To Score A Private Student Loan
    Credit & Loans

    How To Score A Private Student Loan

  4. Is Loan Protection Insurance Right For ...
    Insurance

    Is Loan Protection Insurance Right For ...

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center