INDIAN FINANCIAL

SYSTEM
CIA 3 COMPONENT 1

Submitted By:
RIPUL HOLANI
1620228
4 BBA ‘B’
FINANCIAL SERVICES
Financial services are a part of financial system that provides distinctive types of finance
through diverse credit instruments, financial products and services.

Types of financial services prevalent in India are as follows:-

1. Asset based/fund based services:
 Equipment Leasing/Finance
 Hire Purchase and Consumer Credit
 Bill Discounting
 Venture Capital
 Housing Finance
 Insurance Service
 Factoring
2. Fee based/ Advisory based services:
 Issue management
 Portfolio management
 Corporate Counselling
 Loan Syndication
 Merger and acquisition
 Capital Restructuring
 Credit Rating
 Stock Broking

Equipment Leasing:
Leasing has emerged as an important source of intermediate and long-term financing of
corporate enterprises during the recent few decades. In India, leasing is a recent and
successful development and equipment leasing was introduced by the First Leasing
Company of India limited in 1973 only. Since then, a number of medium to large scale
companies have entered the field of leasing. Leasing is an arrangement that provides a
firm with the use and control over assets without buying and owning the same. It is a form
of renting assets.

Hire Purchase
Hire purchase is a system by which a buyer pays for consumption of a good or a service in
regular installments while enjoying the use of it. During the repayment period, ownership
of the item does not pass to the buyer. Upon the full payment of the loan, the title passes to
the buyer, it is also called installment buying.

Bill Discounting
The process of discounting of bill of exchange is an appealing fund based financial service
offered by the finance companies. Bill discounting has appeared as a profitable business
for finance companies and represent a divergence in their activities. A BOE is a bonding
agreement by some parties to pay a fixed sum of cash to another parties as of a preset date
or on demand. Bills of exchange are largely used in worldwide commerce. Their use has
deteriorated as other systems of payment have become more common.