Presentation on Financial Services

Submitted To Ms.Alka Sood Assistant Professor

Prepared By- Rohit Mahajan

Bupin No.-15PBA012 MBA-4th Semester

What is Financial Services

Financial Services is a term used to refer to the services provided by the finance market. Financial Services is also the term used to describe organizations that deal with the management of money. Examples are the Banks, investment banks, insurance companies, credit card companies and stock brokerages.

Financial Services Institution

• Financial services firms not only helps to raise the require funds but also assure the efficient deployment of funds.

• They Assist in Deciding Financial Mix.• They extent their services up to the stage of servicing

of lender.

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.

Features of Financial Services

• It is a Customer Intensive Industry.• It is Intangible in nature.• Production and Supplier of financial Services must be

perform Simentenously.• Financial Services always be-proactive in visualizing

in advance what the market wants or reactive to the needs and wants of the customer.

Types of Financial Services• Banking – Under this an individual can deposit his or her money

and can get return in the form of interest and also borrowers can get loan by paying interest to bank periodically.

• Insurance – By using this one can get peace of mind as one can buy insurance policies like life insurance, fire, marine, health and general insurance which ensures that person in the event of any mishap can get his or her money back from insurance company.

• Stock Market – One can invest his or her funds into stock market also where one gets dividends and also capital appreciation, if one makes right investment decision than return from equity markets are much greater than that of fixed deposits parked in banks.

Types of Financial Services• Treasury or Debt instruments – Under this one can invest his or

her money into government bonds and also debt instruments of private and public firms.

• Wealth Management – There are many firms where one can jus park their money and then these companies invest money across different assets classes like commodity, derivatives, money market, currency etc… in order to generated superior returns for their clients.

• Mutual Funds – These funds track asset class and generate returns accordingly so a debt fund will track returns of debt and money market, an equity mutual fund would give returns according to performance of stock market and so on.

What is RBI

• The Reserve Bank of India (RBI) is the central bank of India, which was established on April 1, 1935, under the Reserve Bank of India Act. The Reserve Bank of India uses monetary policy to create financial stability in India, and it is charged with regulating the country's currency and credit systems.

Functions of RBI• 1. Issue of Bank Notes: The Reserve Bank of India has the sole right to issue currency

notes except one rupee notes which are issued by the Ministry of Finance. Currency notes issued by the Reserve Bank are declared unlimited legal tender throughout the country.

• 2. Banker to Government: As banker to the government the Reserve Bank manages the

banking needs of the government. It has to-maintain and operate the government’s deposit accounts. It collects receipts of funds and makes payments on behalf of the government. It represents the Government of India as the member of the IMF and the World Bank.

Functions of RBI• 3. Custodian of Cash Reserves of Commercial Banks: The

commercial banks hold deposits in the Reserve Bank and the latter has the custody of the cash reserves of the commercial banks.

• 4. Custodian of Country’s Foreign Currency Reserves: The Reserve Bank has the custody of the country’s reserves of

international currency, and this enables the Reserve Bank to deal with crisis connected with adverse balance of payments position.

• 5. Lender of Last Resort: The commercial banks approach the Reserve Bank in times of

emergency to tide over financial difficulties, and the Reserve bank comes to their rescue though it might charge a higher rate of interest.

Cont.