Glossary

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D

DATABASE (CENTRAL CREDIT REGISTER)

The Central Credit Register (CR) is a database containing information on households' and firms' debts towards the banking and financial systems. It is managed by the Bank of Italy.

DEBIT

A debit is the money withdrawn or used to make payments by the customer or by the bank on the customer’s behalf.

DEBIT CARD (BANCOMAT)

A card that allows cardholders, pursuant to a contract with their bank, to purchase (using a POS terminal) goods and services from any commercial establishment that is a member of the payment circuit on which the card is accepted or to make cash withdrawals (using an ATM), with the sum being immediately withdrawn from the current account linked to the card.

DEBITS

A sum of money withdrawn from the current account by the account holder or by a third party as previously agreed with account holder. The balance of the current account decreases.

DEBTOR INTEREST RATE

The rate used to periodically calculate the interest charged to the customer on the amounts drawn beyond the balance available on the account. The interest is then charged to the account.

DECARBONIZATION OF THE ECONOMIC SYSTEM

The process for reducing the quantity of greenhouse gases in the atmosphere. It includes two intermediate objectives: (a) a lower energy intensity, i.e. the energy needed to produce a unit of product; and (b) a decrease in carbon intensity, i.e. the amount of greenhouse gases emitted for each unit of energy used. Achieving the first objective requires energy efficiency measures; achieving the latter requires the adoption of technologies that reduce the carbon footprint of energy uses, such as electricity generated from renewable sources.

DEDUCTION OF PAYMENTS

This loan is very similar to a salary-backed loan because it allows borrowers to have another fifth of their salary deducted, so that they can get a bigger loan. Applicants for these loans irrevocably authorize their employers to withhold the instalments from their salary to repay the loans granted. However, employers are free to choose whether or not they wish to participate in this type of loan, while they may not decline to do so in the case of salary-backed loans. The law also provides for an insurance policy to cover the risk that the borrower becomes unable to repay the amount owed (for example, due to unemployment).

DIRECT DEBIT

This is a service offered with a current account that makes it possible to make periodic payments, such as utility and mortgage payments, by directly debiting the current account. Direct debits within the Single Euro Payments Area (SEPA) are carried out in the same manner and under the same conditions regardless of whether the payments are being made within Italy or cross-border.

DIRECT INTERBANK RELATIONSHIP (direct debit)

Until the start of 2014, it provided the same functions as a SEPA Direct Debit.

DISCLOSURE

Disclosure or transparency generally refers to accurate and complete information provided to both internal and external players.

DISPUTE (WRITTEN)

Before filing a complaint with the Banking and Financial Ombudsman, you must first submit a written dispute to the intermediary, which has 30 days to reply (15 if the dispute concerns a payment service). The complaint can only contain issues already raised in the dispute.

DIVERSIFICATION

In finance, it's like 'not putting all your eggs in one basket'. Diversification means not limiting yourself to buying one or a few financial instruments but many, and they should be different from each other (for example, shares or bonds issued by various companies in different sectors), or in different asset classes (cash, bonds, shares, real estate). With the same expected return, diversification reduces risks because the returns of different financial instruments and asset classes do not always move in the same direction.

DOMICILE

The domicile of a bank customer who wishes to file a complaint with the Banking and Financial Ombudsman (ABF) is essential in identifying the competent territorial panel:

  • The Milan panel decides on complaints filed by customers domiciled in Friuli-Venezia Giulia, Lombardy, Trentino-Alto Adige and Veneto;
  • The Turin Panel decides on complaints filed by customers domiciled in Liguria, Piedmont and Valle d'Aosta;
  • The Bologna Panel decides on complaints filed by customers domiciled in Emilia-Romagna and Tuscany;
  • The Rome Panel decides on complaints filed by customers domiciled in Abruzzo, Lazio, Marche, Umbria and customers domiciled abroad;
  • The Naples Panel decides on complaints filed by customers domiciled in Campania and Molise;
  • The Bari Panel decides on complaints filed by customers domiciled in Basilicata, Calabria and Puglia;
  • The Palermo Panel decides on complaints filed by customers domiciled in Sardinia and Sicily.
DURATION (mortgage)

The duration of a mortgage loan is agreed upon between the customer and the intermediary and is defined in the loan agreement; it is one of the factors used in calculating the amount of the monthly payment. The monthly payments consist of both principal and interest. Mortgage amounts and interest rates being equal, mortgage loans with a shorter duration have higher monthly payments but lower overall interest costs, while mortgage loans with a longer duration have lower monthly payments but higher overall interest costs.