Course Content

Introduction to Financial Services

Concept of Financial Products and Services
Distinction between financial products and services
Features of financial services
Financial Services Market-Players
Banking Products
Deposit & Loan products, CIBIL
Banking Services
Safe deposit vaults, ATM, remittance of funds, clearing of cheques, currency
exchange, bank guarantee and L/C
RBI and its role
Non-banking Products
Mutual Funds
Insurance: Life and Non-life Insurance
Reinsurance
Bancassurance
Non-banking Services
Leasing
Hire-purchase
Factoring
Forfaiting
Securitization
Investment Banking
Merchant Banking
Depository and Custodial Services
Credit Rating
Introduction to Financial Services
 Financial Products
• Securities and investments created to provide buyers and sellers with
short term or long term financial gains
• Instruments that help you save, invest, get insurance or get a
mortgage
• Enable risks to be spread, and liquidity to circulate around an
economy
• Issued by various banks, financial institutions, stock brokerages,
insurance providers, credit card agencies and government sponsored
entities
• Many of the financial products are in the form of contracts that you
can negotiate on financial markets. The contracts stipulate cash
movement at present and in future, depending on conditions stated
Financial Services
• A part of financial system that provides different types of finance
through various credit instruments, financial products and
services
• Financial services offered by the finance companies,
encompassing both asset management and liability management
companies
• Serve the needs of individuals, institutions and corporates
• The process by which a consumer or business acquires a financial
good
• Financial services enable the user to obtain any asset on credit,
according to his convenience and at a reasonable interest rate
Difference between Financial Products & Services
• Tangibility
• Inseparability of production and consumption
• Perishability
• Dynamism
• Orientation
Types of Financial Services
• Banking Services
• Safe deposit vaults, remittance, payment and collection
services, ATMs, currency exchange, Letter of Credit and Bank
Guarantee
• Non-Banking Services
• Fee based Services
• Merchant banking, stock broking, credit rating, portfolio
management services, underwriting
• Fund based Services
• Factoring & forfeiting, leasing & hire-purchase, venture capital,
housing finance, bill-discounting
Constituents
• Market Players
• Banks, financing institutions, mutual funds, merchant bankers, stock
brokers, underwriters
• Instruments
• Equity, debt, hybrid and exotic instruments
• Specialized Institutions
• Acceptance houses, discount houses, factors, depositories, credit rating
agencies, venture capital institutions
• Regulatory Bodies
• Department of Banking and Insurance
• RBI
• SEBI
• BIFR
Evolution & Growth of Financial Services
• Merchant Banking Era
• Investment Companies Era
• Modern Services Era
• Depositories Era
• Legislative Era
• FIIs Era
Importance of Financial Services
• Vibrant Capital Market
• Expands activities of financial markets
• Benefits of Government
• Economic Development
• Economic Growth
• Ensures Greater Yield
• Maximizes Returns
• Minimizes Risks
• Promotes Savings
• Promotes Investments
• Balanced Regional Development
• Promotion of Domestic & Foreign Trade