BANK

AS
FINANCIAL SERVICE
PROVIDER

Under the guidance of

“Institute for Finance, Banking and Insurance (IFBI)”)
 INTRODUCTION
 Financial services can be defined as the products and
services offered by institutions like banks of various
kinds.

 Banks are facilitating various financial transactions and

other related activities in the world of finance like loans,
insurance, credit cards, investment opportunities and
money management.
 Definition of bank
 An institution which deals in money and credit.

 An intermediary, which handles other people’s money both for

their advantage and to its own profits.

 A financial institution that links the flow of funds from savers

to the users.

 Plays an important role in the economy of any country as they

hold the saving of the public.
CLASSIFICATIONS OF PRODUCTS &
SERVICES

 Bank role as intermediary

 As payment system constituent
 As provider of other services
 BANK ROLE AS
INTERMEIDARY
Deposit products:
 Savings account:
 Save the surplus money
 Carries a rate of fixed interest by RBI
 Can be withdrawn through cheque or atm card
 Not for business purposes
 Current account:
 Account meant for business purposes.
 No restriction on number of withdraws.
 Carries no interest.
 Term deposit account:
 These accounts are maintained for definite term
 For short term called short term deposit or for a longer period
long term deposit.
 Interest paid as per bank internal regulations.
 BANK ROLE AS
INTERMEIDARY
Loan products:
Also known as asset products.
 Demand loan:
 A short term loan that is repayable on demand or repaid in
periodic installments.
 Loan period is max 180 days to 1 year.
 Term loan:
 A loan that is repayable as per terms of agreement and
spread over a longer period of time.
 Loan period is above 1 year
 Repaid in Emi or reducing balance method
Overdraft
 A circulating credit
 Sum is fixed as limit and its within limit amount can be
withdrawn.
 Provided in current account and against security or fixed
deposit
 Without security called clean overdraft
Bills advance:
 A document wherein two parties acknowledge the money
owing on a trade transaction.
 Seller writes a bill of exchange and buyer acknowledges.
 Process is called bill of exchange
 Seller goes to bank and request money for against bill of
exchange.
Cash credit:
 Similar to overdraft and given for meeting the day to day
expenses of running a business.
 As payment system constituent
Payment system denotes smoothening the flow of money from
one person to another person. For this process service of bank are
required.
Pay order or bankers cheque:
 This is a simple instrument issued by a branch of a bank
and is payable in that same branch.
 Examples like payment of university fees or recruitment
exam fees.
Demand draft:
 It is payable in an outstation location
Multi city cheque:
 These are payable at par at centers than the one at which
the customer is maintaining his account.
 It means cheque is paid without deduction of any charges
by bank
 As payment system constituent

National electronic funds transfer(NEFT)

 Customers who want to send money faster can avail this
service.
 It is a bank to bank transfer through electronic media
controlled by RBI.
 Above 2 lakh is sent through RTGS(real time gross
settlement system).
Clearing:
 Cheques are issued by people in favour of persons to
whom they have to make payment and deposit these
cheque with bank.
 These are collected by using the clearing system.
 Provider of other services
Safe deposit locker:
 Helps customers to keep their valuable articles such as jewellery
and documents safe in locker allocated for a customer.
 Need to pay rent as per size.
Safe custody service
 Provides safe custody service by keeping sealed packets.
 Charge is levied by bank.
Collection of utility bills,taxes and honouring
standing instructions
 Helps public in payment of utility bills like telephone, electricity.
 Taxes like income, service tax.
 Takes standing instructions from customers.
Demat accounts
 It helps in holding shares in dematerialised form.It shows
number of shares held by a investor.
 other services
Sale of gold coins
Banks also sell gold coins, and that
reduces the chances of fraud.
The Gold coins are available in
different size.The usual sizes are coins of
2, 4, 5, 8, 10, 20 and 50 grams. The coins
are 24 carats, and the banks guarantee
their purity to gold coins through their
branches

Distribution of mutual
funds:
Bank offers both propreitary mutual
funds and non propreitary mutual funds.
 other services
Distribution of insurance products
Banks in India are all selling insurance
products, especially the public sector banks.
Many insurance companies are selling their
products through banks. Companies which are
bank owned, they are selling their products
through their parent bank.

Online banking:
Online banking (or Internet banking) allows
customers to conduct financial transactions on a
secure website operated by bank.
Do transactions relating to payments,
transfer of funds, investment purchase or sale,
loan proceedings.
 other services
ATM services
 Providing 24 hrs a day banking
convenience to its customers. we can
withdraw cash, transfer funds, payment
of insurance premium etc.

Debit cards & credit cards:

Debit Cards or Credit Debit Cards
are electronic plastic cards that are
used as a substitute for cash. A credit
cardholder has issue credit by bank.
has a monthly bill to pay in every month
that the card is used.
 other services
Wealth management services
for hni:
Individuals, having financial assets
over $ 1 million are treated as HNIs & 
Individuals, having financial assets over $
30 million are treated as Ultra HNIs. 

Mobile banking
Mobile banking (also known as M-
Banking, m-banking, SMS Banking) is a
term used for performing balance
checks, account transactions, payments,
credit applications and other banking
transactions through a mobile device
such as a mobile phone.
 other services
Phone banking
Account balance information and list
of latest transactions, electronic bill
payments, investment purchases and
redemptions, cheque book orders, debit
card replacements, change of address,
etc.

Nri services
An NRE account holder can withdraw
money from his account freely, whereas
for an NRO account holder only local
payment is allowed in rupees. He cannot
repatriate his funds from account
abroad.
 CONCLUSION
 BFSI sector contributes 14% to GDP of India.
 Globalisation led many foreign and private

banks to establish and created competition

in market.
 Banks are concentrating more on delivery

of services to attract the customers by

using technology.
 Different types of products are offering
for the customer wants and needs.