Introduction

Banks were used only a place to park surpluses in earlier times. With increasing needs of
customers today Banks have changed the traditional line of business of deposits & lending
and have enriched themselves by introducing new financial products and services. They also
provide third party products. Banks have become one stop service providers for the
convenience of customers.

Insurance
Insurance is the equitable transfer of the risk of a loss, from one entity to another in
exchange for money.
It is a form of risk management primarily used to hedge against the risk of a
contingent, uncertain loss.

What are the Advantages of Insurance

Assures for financial compensation
Insurance provides financial security to the insured. It gives guarantee of compensation against
large financial losses in return of small premium.

Reduction of risks
Human beings are exposed to different kinds of financial risks, which may cause large financial
losses. It is not possible to eliminate the risks but it can be forecasted and reduced by applying
some precautionary measures. Insurance helps in reducing risks by suggesting for pre caution
measures on one side and by sharing the losses to a group of person who has agreed to join the
common pool.

Encouragement to saving and investment

In the insurance agreement, the insured has to pay a certain regular premium to the insurer in
return to the compensation of the probable future loss or compensation at old age or
compensation after his/her death. Insurance is thus a method of collecting saving from the parties

willing to get secured from the financial risks. Hence, it encourages persons to make regular
savings.

Basis of credit
An insured can easily get loan by pledging insurance policy as a security from the insurance
company itself. Besides, financial institutions grant credit facilities on the pledge of the
properties which are being insured.

Maintains economic stability

Financial risks and uncertainties pushes the entire economy into instability. It is a very bad sign
to total business and social sectors. Insurance assures the compensation of the financial losses
caused by the specified future events and considerably helps in maintaining economic stability.

Promotes business activities

Business sector is more risky sector. The chances of fire in the go down, loss of stocks by theft,
explosion in the ship, train or plane etc. are more frequent in this sector. Insurance takes away
these risks and promotes and develops business activities in consideration to a nominal charge i.e
premium.

Provides employment opportunities

As insurance has become business in the modern day business world, hundreds of entrepreneurs
and thousands of employees have been engaging in this line. Hence, by establishing and
developing insurance companies, it has provided employment opportunities to thousands of
people as per their qualification and calibre.

bancassurance
'Integrated models' is insurance activity deeply integrated with bank's processes. Premium is
usually collected by the bank, usually direct debit from customer's account held in that bank.
Insurance products are distributed by branch staff, which is sometimes supported by specialised
insurance advisers for more sophisticated products or for certain types of clients. Life insurance
products are fully integrated in the banks range of savings and investment products and the trend
is for branch staff to sell a growing number of insurance products that are becoming farther
removed from its core business, e.g., protection, health, or non-life products.
Products are mainly medium- and long-term tax-advantaged investment products. They are
designed specifically for bancassurance channels to meet the needs of branch advisers in terms of

simplicity and similarity with banking products. In particular, these products often have a lowrisk insurance component.
Bank branches receive commissions for the sale of life insurance products. Part of the
commissions can be paid to branch staff as commissions or bonuses based on the achievement of
sales targets.
'Non-integrated models' The sale of life insurance products by branch staff has been limited
by regulatory constraints since most investment-based products can only be sold by authorised
financial advisers who have obtained a minimum qualification.
Banks have therefore set up networks of financial advisers authorised to sell regulated insurance
products.They usually operate as tied agents and sell exclusively the products manufactured by
the banks in-house insurance company or its third-party provider(s).
A proactive approach is used to generate leads for the financial advisers from the customer base,
including through mailings and telesales. There is increasing focus on developing relationships
with the large number of customers who rarely or never visit a bank branch.
Financial planners are typically employed by the bank or building society rather than the life
company and usually receive a basic salary plus a bonus element based on a combination of
factors including sales volumes, persistency, and product mix.
Banks will have the possibility to become multi-tied distributors offering a range of products
from different providers. This has the potential to strengthen the position of bancassurers by
allowing them to meet their customers needs.

TYPES
Term Insurance

This type of life insurance policy is a contract between the insured and the life insurance
company to pay the persons/s he has given entitlement to receive the money, in the case of
his/her death, after a certain period of time. These policies can be taken for 5, 10, 15, 20 or 30
years.
Endowment Policy

In an endowment policy, periodic premiums are received by the insured person and a lump sum
is received either on the death of the insured or once the policy period expires.
Money Back Life Insurance Policy

This policy offers the payment of partial survival benefits (money back), as is determined in the
insurance contract, while the insured is still alive. In case the insured dies during the period of
the policy, the beneficiary gets the full sum insured without the deduction of the money back
amount given so far.
Group Life Insurance

This is when a group of people have been named under a single life insurance policy. It is
popular for an employer or a company to add employees under the same policy. Each member of
the group has a certificate as legal evidence of insurance.
Unit Linked Insurance Plan

Term Insurance

This type of life insurance policy is a contract between the insured and the life insurance
company to pay the persons/s he has given entitlement to receive the money, in the case of
his/her death, after a certain period of time. These policies can be taken for 5, 10, 15, 20 or 30
years.
Endowment Policy
In an endowment policy, periodic premiums are received by the insured person and a lump sum
is received either on the death of the insured or once the policy period expires.
Money Back Life Insurance Policy
This policy offers the payment of partial survival benefits (money back), as is determined in the
insurance contract, while the insured is still alive. In case the insured dies during the period of
the policy, the beneficiary gets the full sum insured without the deduction of the money back
amount given so far.
Group Life Insurance
This is when a group of people have been named under a single life insurance policy. It is
popular for an employer or a company to add employees under the same policy. Each member of
the group has a certificate as legal evidence of insurance.
Unit Linked Insurance Plan

ULIPs (Unit Linked Insurance Plan) offer the insured the double benefit of protection from risk
and investment opportunities. ULIPs are linked to the market where the insureds money is
invested to help earn additional monetary benefits.

General Insurance

Home Insurance
Travel Insurance
Motor Vehicle Insurance
Health Insurance
Fire Insurance
Marine Insurance

MUTUAL FUND
An investment vehicle that is made up of a pool of funds collected from many
investors for the purpose of investing in securities such as stocks, bonds, money
market instruments and similar assets. Mutual funds are operated by money
managers, who invest the fund's capital and attempt to produce capital gains and
income for the fund's investors. A mutual fund's portfolio is structured and
maintained to match the investment objectives stated in its prospectus.

Advantages of Mutual Fund

Professional management. Qualified professionals manage your money, but they
are not alone. They have a research team that continuously analyses the
performance and prospects of companies. They also select suitable investments to
achieve the objectives of the scheme. It is a continuous process that takes time and

expertise which will add value to your investment. Fund managers are in a better
position to manage your investments and get higher returns.
Diversification. The clich, "don't put all your eggs in one basket" really applies to
the concept of intelligent investing. Diversification lowers your risk of loss by
spreading your money across various industries and geographic regions. It is a rare
occasion when all stocks decline at the same time and in the same proportion.
Sector funds spread your investment across only one industry so they are less
diversified and therefore generally more volatile.
Risk Reduction
A reduced portfolio risk is achieved through the use of diversification, as most
mutual funds will invest in anywhere from 50 to 200 different securities depending on their focus. Several index stock mutual funds own 1,000 or more
individual stock positions.
More choice. Mutual funds offer a variety of schemes that will suit your needs over
a lifetime. When you enter a new stage in your life, all you need to do is sit down
with your financial advisor who will help you to rearrange your portfolio to suit
your altered lifestyle.
Affordability. As a small investor, you may find that it is not possible to buy shares
of larger corporations. Mutual funds generally buy and sell securities in large
volumes which allow investors to benefit from lower trading costs. The smallest
investor can get started on mutual funds because of the minimal investment
requirements. You can invest with a minimum of Rs.500 in a Systematic
Investment Plan on a regular basis.
Tax benefits. Investments held by investors for a period of 12 months or more
qualify for capital gains and will be taxed accordingly. These investments also get
the benefit of indexation.
Liquidity. With open-end funds, you can redeem all or part of your investment any
time you wish and receive the current value of the shares. Funds are more liquid
than most investments in shares, deposits and bonds. Moreover, the process is
standardised, making it quick and efficient so that you can get your cash in hand as
soon as possible.
Transparency. The performance of a mutual fund is reviewed by various
publications and rating agencies, making it easy for investors to compare fund to
another. As a unitholder, you are provided with regular updates, for example daily

NAVs, as well as information on the fund's holdings and the fund manager's
strategy.
Regulations. All mutual funds are required to register with SEBI (Securities
Exchange Board of India). They are obliged to follow strict regulations designed to
protect investors. All operations are also regularly monitored by the SEBI.
WHAT ARE VARIOUS TYPES OF MUTUAL FUNDS :

A common man is so much confused about the various kinds of Mutual Funds that he is
afraid of investing in these funds as he can not differentiate between various types of
Mutual Funds with fancy names. Mutual Funds can be classified into various categories
under the following heads:-

(A) ACCORDING TO TYPE OF INVESTMENTS :- While launching a new scheme, every

Mutual Fund is supposed to declare in the prospectus the kind of instruments in which it
will make investments of the funds collected under that scheme. Thus, the various kinds of
Mutual Fund schemes as categorized according to the type of investments are as follows :-

(a) EQUITY FUNDS / SCHEMES

(b) DEBT FUNDS / SCHEMES (also called Income Funds)
(c ) DIVERSIFIED FUNDS / SCHEMES (Also called Balanced Funds)
(d) GILT FUNDS / SCHEMES
(e) MONEY MARKET FUNDS / SCHEMES
(f) SECTOR SPECIFIC FUNDS
(g) INDEX FUNDS

B) ACCORDING TO THE TIME OF CLOSURE OF THE SCHEME : While launching

new schemes, Mutual Funds also declare whether this will be an open ended scheme (i.e.
there is no specific date when the scheme will be closed) or there is a closing date when
finally the scheme will be wind up. Thus, according to the time of closure schemes are
classified as follows :-

(a) OPEN ENDED SCHEMES

(b) CLOSE ENDED SCHEMES

Open ended funds are allowed to issue and redeem units any time during the life of the
scheme, but close ended funds can not issue new units except in case of bonus or rights
issue. Therefore, unit capital of open ended funds can fluctuate on daily basis (as new
investors may purchase fresh units), but that is not the case for close ended schemes. In
other words we can say that new investors can join the scheme by directly applying to the
mutual fund at applicable net asset value related prices in case of open ended schemes but
not in case of close ended schemes. In case of close ended schemes, new investors can buy
the units only from secondary markets.

C) ACCORDING TO TAX INCENTIVE SCHEMES : Mutual Funds are also allowed to

float some tax saving schemes. Therefore, sometimes the schemes are classified according
to this also:-

(a) TAX SAVING FUNDS

(b) NOT TAX SAVING FUNDS / OTHER FUNDS

(D) ACCORDING TO THE TIME OF PAYOUT : Sometimes Mutual Fund schemes are
classified according to the periodicity of the pay outs (i.e. dividend etc.). The categories are
as follows :-

(a) Dividend Paying Schemes

(b) Reinvestment Schemes

GOLD CoINS
Gold has been traditionally the popular investment for Indians. In fact, India, even today is
amongst the largest buyers of Gold in the world, followed closely by Silver

It is universally accepted since the

coin is made of gold
Free and Unrestricted import and
export of gold under gold coin
standard ensures stability in foreign
exchange rates
This is the Simplest form of gold
standard which can be easily
understood by the common people
Buying gold is easy to liquidate
Features
High Quality:

24 Carat ICICI Bank Pure Gold and Silver is imported from Switzerland.

This gold and silver carries a 99.99% Assay Certification.

Highest level of purity, in accordance with international standards.

Convenience:

Convenient tamper-proof certi-card packs.

Denominations:

Gold is available in 0.5g, 1g, 2.5g, 5g, 8g, 10g, 20g, 50g and 100g.

Silver is available in 50g and 100g.

Availability:

This are available through selected branches of banks and through Internet Banking.

Prices:

Price is based on daily prices in the international bullion market. The price is inclusive of
customs duty and other charges involved in the retailing of gold and silver bars.

Mobile Recharge
Customers can recharge their account easily and instantly. The accounts
debit are easily displayed into the account.

Customers can enjoy the benefit of doing anytime and everywhere online
recharge.
Online recharge facility offers complete freedom to customers to do instant
recharge of any desired amount as per their convenience
Online recharge enables stress free, user friendly and convenient option of
refilling of the prepaid account for doing recharge over the internet.
Online recharge not only offers convenient way of recharging account from
home, but also saves time and energy
You can get your prepaid account recharged anytime and from anywhere
because banks offer services 24/7 basis

Steps for Prepaid Mobile Recharge:

(ICICI Bank)

login to www.icicibank.com.

Go to Payments & Transfer, select Prepaid Recharge.

Click on Prepaid Mobile Recharge

Select your operator name, enter your mobile number and amount of
recharge.

Enter One Time Password (OTP) to complete your transaction.

Your Prepaid Mobile Recharge request will be processed in few minutes.

Demat Account

In India, shares and securities are held electronically in a

dematerialized or Demat account, instead of the investor taking
physical possession of certificates.

A Dematerialized account is opened by the investor while registering

with an investment broker (or sub-broker).

The Dematerialized account number is quoted for all transactions to

enable electronic settlements of trades to take place.

Every shareholder will have a Dematerialized account for the purpose

of transacting shares.

Access to the Dematerialized account requires an internet password

and a transaction password.

Transfers or purchases of securities can then be initiated.

Purchases and sales of securities on the Dematerialized account are

automatically made once transactions are confirmed and completed

Demat benefits
Demat account for shares and securities with Business purpose
The benefits of demat are enumerated as follows:

Easy and convenient way to hold securities

Immediate transfer of securities

No stamp duty on transfer of securities

Safer than paper-shares (earlier risks associated with physical certificates such as bad
delivery, fake securities, delays, thefts etc. are mostly eliminated)

Reduced paperwork for transfer of securities

Reduced transaction cost

No "odd lot" problem: even one share can be sold

Change in address recorded with a DP gets registered with all companies in which
investor holds securities eliminating the need to correspond with each of them separately.

Transmission of securities is done by DP, eliminating the need for notifying companies.

Automatic credit into demat account for shares arising out of bonus/split,
consolidation/merger, etc.

A single demat account can hold investments in both equity and debt instruments.

Traders can work from anywhere (e.g. even from home).

Documents Required For Demat Account

PAN (Compulsory)

Bank statement (last 3 months)

Address Proof

Income Tax Return

Two colour photos

Bank crossed Cheque (If required)

KYC details

Safe Keeping
Safe Deposit Vault

Safe keeping facility is a Traditional function of banks.

Lockers are Easy access and provided at Reasonable rates

Rents are charged as per size of the locker and are payable in advance

Lockers can be hired by individuals, firms, limited companies, societies,

etc.

Lockers are rented out for a Minimum period of 1year

Nomination for safe deposit locker are available

There are 2 keys, 1 is kept with bank so that bank can control access to
safe

Safe Custody

Banks accept sealed packet of valuables for safe keeping in their

strong rooms
Packets were kept in bank safe
Articles are returned upon the customer handling over the receipt
Banks today deposit the duplicate keys of branches for safe custody
with other banks in case of emergencies in exceptional cases
Annual rent is calculated from the date you open the locker to the
same date next year
If you decide to close the locker in mid year in most cases you forego
the annual rent which you paid at the beginning of the year
Most banks claim that confidentiality of the locker contents is
maintained unless the income tax authorities or the police deem
otherwise
Locker facility is not available at all the branches of the bank.

Collection of Taxes

Earlier, taxes payable to central and state government could be paid

only at the branches of SBI and other public sector banks.

Now, almost all banks, including private sector banks, have been
authorized to collect taxes on behalf of government.

The amount collected is remitted to RBI where government tax

accounts are there.

To facilitate easy payment of taxes, banks are providing the facility of

online payments of tax through net banking.

Payment of Utility Bills

Today banks facilitate customer to pay bills from the comfort of your home or office. This is a
facility ideal for your electricity, telephone, mobile and other bills. Do away with checque, late
payments and lost bills, and enjoy the convenience!
Today banks have made themselves the one stop shop solution for all your payments needs.
Banks have over 200 plus billers for you to choose from and make payments.
Some types of bills which most of the customer pay are:

Electricity Bills

Gas Bills

Mobile Bills

DTH/prepaid mobile recharge

Landline and Internet Bills

Insurance Premiums

Other bank credit card bills

Advisory Services

Professional assistance for investor

Consultancy service to private banking customers

Help in minimizing risk and maximizing returns

Advice customers for investment related transactions.

Contribute a substantial portion of profits to retail banking business of

banks

Types of advisory service

1) Wealth advisory service
Whether your wealth comes from building a business, successful investments or
family inheritance, robust family and estate planning it is essential for protecting
your wealth. Wealth Advisory offers advice and provides trust, tax and insurance
solutions to ensure your financial goals can be achieved. All investment carries risk.
Investments can fall in value and you may get back less than you invested. Hence
banks help us by providing advisory services.

Asset Advisory Services,

As an investor we may engage an investment firm to execute your transactions while we act in
the advisory role. This transaction approach though rich in choice, is also a time intensive
process requiring detailed follow up on the various asset classes and the products.
In a transaction model, our portfolio has to be consistently balanced evaluating risk and return
for every product. Hence bank provides advisory service that will not only understand us as an
investor but further also provides tailor investment solutions to suit your needs.
Some asset advisory services are
As an investor you may engage an investment firm to execute your transactions while you act in
the advisory role. This transaction approach though rich in choice, is also a time intensive
process requiring detailed follow up on the various asset classes and the products.
In a transaction model, your portfolio has to be consistently balanced evaluating risk and return
for every product. An advisory service will not only understand you as an investor but further
tailor investment solutions to suit your needs.

Planning and Profiling

Understanding your goals and what you require enables your advisor to put in place and
implement a plan to match your requirements.

Research Capabilities

Enabled with access to a range of products across asset classes and providers, you will be
recommended products that are duly researched, analyzed, and short-listed based on true
open architecture.

Expertise

With the involvement of sophisticated models and tools ratified by the views of best-inindustry expert, you can leverage process expertise.

Alignment of Interest

Where firms offer complete alignment of interest, driven by prudential limits set on
exposure to fund houses, manufacturers, product lines.

Fee Based Model

A viable commercial structure, including a fee model based on assets under advice that
also aims to reduce transaction overheads.
TRANSACTION ADVISORY SERVICES
The transaction advisory experts and dedicated teams with specific industry expertise offer a
forward-looking perspective and track record of success across the entire transaction life cycle.
Whether representing buyers, sellers or lenders, BANKS offer comprehensive due diligence
advice and hands-on support in evaluating opportunities across the risk/return spectrum. BANKS
help their clients to maximize value and minimize risk.

Portfolio advisory services

Portfolio Advisory Services is a value-added service offered to clients who seek to a high-quality
wealth management advisory desk and research team but are comfortable making their own
investment decisions.
As a Portfolio Advisory Services client, banks have

A dedicated Wealth Advisory Desk standing ready to answer customers queries and
unique needs

Assessment of their risk profile and help with constructing / rebalancing an investment
portfolio that matches your risk appetite.

Access to high quality research and investment strategies

The guidance can be on-going or as needed at client discretion

Under these services, Wealth Management Service desk can only suggest investment ideas that
match the assessed risk-reward profile agreed for the investor. The choice as well as the
execution of the investment decisions rest solely with the Investor.

Debt & Capital Advisory service includes

Structuring of tailored financing solutions

Conducting competitive tenders for the provision of financing solutions, including the
negotiation of termsheets and financing documentation

Negotiating amendments and waivers to existing financing terms, including financial

covenants and debt rescheduling

Negotiating restructuring of existing financing facilities

Managing a credit rating agency process

Managing stakeholder relationships

Project managing financing transactions

Conclusion
The financial services sector in India has undergone a complete and new face change
since 1990.
The banking sector in India has experienced a rapid transformation.
The major trends triggering this change are commoditization of services, differentiation
on features of the products and competition from local and international industry entrants.
A shift from the conventional interest based income structure to a more predictable and
steady fee based incomes structure suggests a change in the basic outlook of modern
financial services
Banks now rely on evolving long-term association with customers for which they focus
on sustaining profitable relation with customers rather than attracting new customers.