JMJ

Retail Financial Services

06/15/2023 Archana S TIM 1

 Contents

Retail Financial Services

oCredit Cards
oDebit Cards
oSmart Cards
oAutomated Teller Machines
oElectronic Fund Transfer
oElectronic Clearing
oPortfolio Management Services
oBroking Services
oConsumer Credit
oHire Purchase Finance
oHousing Finance
oPersonal Tax Counseling
oInternet Banking
oVirtual
06/15/2023
Banking Archana S TIM 2
 Retail Financial Services
• The retail financial services (RFS) sector covers
all banking, insurance and wealth management
services to individuals and small businesses.
• It helps to meet the financial needs of
consumers and small businesses.
• The retail financial services market is having a
potential $30 billion and it is regarded as the key
driver to the Indian economy.

06/15/2023 Archana S TIM 3

 Retail Financial services are….
o Credit cards o Broking Services
o Debit cards o Consumer Credit
o Smart cards o Hire Purchase Finance
o Automated Teller o Housing Finance
Machines o Personal Tax
o Electronic Fund Transfer Counseling
o Electronic Clearing o Internet Banking
o Portfolio Management o Virtual Banking
Services
06/15/2023 Archana S TIM 4
 JMJ

Credit Cards

06/15/2023 Archana S TIM 5

What is Credit card?
• A credit card is a card or mechanism which enables
cardholders to purchase goods, travel and dine in a
hotel without making immediate payments.

• It is a part of a system of payments named after the

small plastic card issued to users(Cardholders) of
the system. The issuer of the card grants a line of
credit to the user from which he/she can borrow
money for payment to a merchant(Member
establishment) or as a cash advance to the user.
06/15/2023 Archana S TIM 6
Parties to a Credit Card
Issuer: Bank or other card
issuing organisations

Cardholders: Individuals,
corporate bodies, etc

Member Establishments:
Shops and service
organisations enlisted by
Member issuer who accept credit cards
Affiliate:
Visa, Master
Card, etc
06/15/2023 Archana S TIM 7
Procedure of credit card operation

• The card holder gives the card to the merchant after

the purchase of something.
• She/he after proper verification swipe it with the
card payment terminal.
• After electronic verification n account adjustments,
a charge slip in triplicate is being generated, one
copy to customer, one to merchant, n one to bank.
• The one copy of charge slip will be signed by the
user for further verification n kept with merchant.
• Happy User…. Happy Seller… Happy Banker..!
06/15/2023 Archana S TIM 8
How it works?

06/15/2023 Archana S TIM 9

Types of Credit Cards

1. Credit Card
 Normal card, can purchase without cash n can withdraw
money.
 Revolving credit principle
 A limit in the amount can spend, up to 45 days of credit,
interest on outstanding ( 30 -36 % /annum)
2. Charge Card
 Convenient means of payment for goods purchased.
 Makes purchase, consolidated bill for a specific period.
 Bills are payable in full on presentation.
 No interest charges, no limits on spending

06/15/2023 Andhra bank, BOB, Can, ArchanaDiner’s
S TIM club card etc 10
 3. In-Store Card
 Issued by retailers or companies, but purchase restricted to issuer’s
outlets or products only.
 Payment on monthly or extended credit basis, but interest is charged
for extended period.
 Usually issued by hotels, resorts, petroleum Cos, etc

4. Corporate Credit Cards

 Issued to public, private limited Cos and public sector units.
 Add-on cards can be issued to persons authorized by company.
 Name of the Co 'will be endorsed on add-on cards.
 Transactions on add-on cards are also billed to main card and debits
06/15/2023 Archana S TIM 11
are made to company’s account.
5. Business Cards
 Similar to corporate card.
 Meant for the use of proprietary concerns, firms, etc.
 Limit is fixed based on status of firms.

6. Virtual card
 Main purpose is to provide security.
 Can be generated by anybody at any time if he has already
registered his name in Bank’s website.
 Lapses after use and can’t be revised.
 Completely prevents misuse and offered to existing card holders
free of cost.
06/15/2023 Archana S TIM 12
Benefits of Credit card

To card holders:
 Simple to operate and easy to carry. No risk of carrying
cash or cheque book .
 Purchase now- Payment later.
 Can also be used as ATM card.
 Overdraft facility is also available on past credit rating.
 Purchasing power increases and have extra money free
of interest.
 Provides certain level of prestige.
06/15/2023 Archana S TIM 13
Benefits of Credit card

To issuers:
 Offers high profit- Commission of 2.5% on sales, 1.5% on
outstanding, and sometimes may accumulates to 60%
per annum.
 May help to get new customers
 Helps to reduce cost

06/15/2023 Archana S TIM 14

Benefits of Credit card

To Member Establishments:
 Has guarantee of payment and no bad debts.
 Speedy settlement of bills by banks and a good cash
flow can be maintained.
 Reduces cash security risk.
 Can offer credit facility without setting up own credit
arrangements.
 Helps to increase volume of business.

06/15/2023 Archana S TIM 15

Demerits of Credit card

To Card Holders:

 May have the burden of service charge, annual fee,

membership fee, etc.
 A minimum of 5-10% have to paid for the late payment.
 Heavy interest rate for defaulters n some hidden
charges may occur.
 May tempt the holders to spend more than their
income and repaying capacity.
06/15/2023 Archana S TIM 16
Demerits of Credit card

To issuers:

 Cost involved is high- Cost of card, cost of staff to

process applications, cost of placing and marketing, etc
 The menace of frauds perpetuated by holders of fake
cards.
 Disputes with member establishments.
 Underutilisation.

06/15/2023 Archana S TIM 17

Demerits of Credit card

To Member Establishment:

 The commission to be paid to the issuing banks/ credit

card organisation is heavy.
 Some banks may delay in payments.

06/15/2023 Archana S TIM 18

 Debit Cards

06/15/2023 Archana S TIM 19

What is Debit card?
• It is a plastic card which provides an alternative
payment method to cash when making purchases.

• The holder needs to have a bank account to get

debit card.

• Used widely for telephone and Internet purchases.

• It also allow for instant withdrawal of cash, acting as

the ATM card for withdrawing cash
06/15/2023 Archana S TIM 20
Procedure of operation

• After purchase the card holder can present the card

to the merchant.
• He’ll swipe card at terminal known as Point of Sale
Terminal and the holder may be asked to enter the
4 digit PIN.
• After further electronic processing, a sales slip will
be generated in 3 copies as in credit card.
• The purchase amount will be automatically
deducted from the bank account.
06/15/2023 Archana S TIM 21
Benefits of Debit card

 No need to carry cash.

 Obtaining a debit card is easier than credit card.
 More security than Credit card.
 Avoids overdraft, permits to purchase only up to
amount available in account.
 No service charge, fee, fine etc
 No worry of credit, monthly bills, payments etc.

06/15/2023 Archana S TIM 22

Demerits of Debit card

 Record keeping is mandatory

 Convenience is not always guaranteed
 Hidden fees
 Internet scams
 Fear of loosing
 Some ATM machines charge a fee for use.
 No way to withhold payment.

06/15/2023 Archana S TIM 23

 Difference between Credit Card and
Debit Card
Credit Card Debit Card
1. Pay later Product 1. Pay now Product
2. Credit for 30 to 40 days 2. No Credit, Amount
debited immediately.
3. No need of sophisticated 3. Needs sophisticated
telecommunication system communication network
4. No need of bank account 4. Needs bank account and
and balance in it. sufficient balance in it.
5. Possibility of risk of fraud is 5. Risk is minimized through
high. PIN.
06/15/2023 Archana S TIM 24
Smart Cards

06/15/2023
Archana S TIM 25
Smart cards

• A smart card, chip card, or integrated circuit card

(ICC), is any pocket-sized card with embedded
integrated circuits which can process data.

• Two broad categories of ICCs.

Memory cards: Contain only non-volatile
memory storage components, and perhaps some
specific security logic.
Microprocessor: Contain volatile memory and
microprocessor components.
06/15/2023 Archana S TIM 26
Smart cards

• It can receive input and can deliver output.

• The card is made of plastic, generally PVC.

• It has a hologram to avoid counterfeit ( imitation)

• Eg: SIM cards in mobile

06/15/2023 Archana S TIM 27

Applications of Smart cards
• Computer security
Smart cards are used to securely hold encryption keys, and
also to add another layer of encryption to critical parts of
the secured disk.
• Financial Applications
ATM cards, fuel cards, SIMs for mobile phones,
authorization cards for pay television, high-security
identification and access-control cards, and public
transport and public phone payment cards
• Identification
Smart cards are usedArchana
06/15/2023
forS TIMauthentication of identity.
28
Benefits of Smart cards
 It can be readily reconfigured
 Reusable
 Transactions can be done off and on-line
 Gives more security, thus reducing the risk of
transaction fraud
 High memory capabilities
 They are much more durable and reliable
 They allow multiple applications to be stored in one card.
 It is more convenient, since people don't have to carry
cash or multiple cards.
06/15/2023 Archana S TIM 29
Demerits of Smart cards

 Fees applied with the use of a card

 It gives liability issues if stolen or lost
 Lack of technology to support users
 It is potential for too much data on one card if lost
or stolen

06/15/2023 Archana S TIM 30

 Automated Teller Machine

“Automated Teller Machine(ATM) is an

electronic machine which is operated by the
customer himself to make deposits withdrawals
and other financial transactions”

06/15/2023 Archana S TIM 31

 • Merits
• Round the clock quick service to the
customers
• There is ease and privacy of operations
• Self operating and no need for bank staff
• Free from human errors
• Cost of maintenance of ATM is lesser
• Reduces rush in bank
06/15/2023 Archana S TIM 32
• Demerits
• Initial set up cost is high
• This system demands a higher degree of
sophistication and literacy on the part of users
• Cash dispensation is limited to a few
denominations.

06/15/2023 Archana S TIM 33

 History
• Invented by Scot John Shepherd-Barron.
• The world's first ATM was installed in a branch of Barclays
in the northern London
• De La Rue developed the first electronic ATM
• First person to use-Reg Wamey
• The first ATMs accepted only a single-use token or voucher
• The idea of a PIN stored on the card was developed by the
British engineer John Rose in 1965
• Wide UK use in 1973
• IBM 2984 CIT (Cash Issuing Terminal) was the first true
Cashpoint, similar in function
06/15/2023 Archana S TIM
to today's 34
 Location
• Bank premises
• Public places
Two types
o On premises-complement to an actual bank
branch’s capability.
o Off premise-for straight need of cash.

06/15/2023 Archana S TIM 35

 Alternative uses
• Deposit currency recognition, acceptance, and recycling
• Paying routine bills, fees, and taxes (utilities, phone bills, social security, legal
fees, taxes, etc.)
• Printing bank statements
• Updating passbooks
• Loading monetary value into stored value cards
• Purchasing
• Games and promotional feature
• Donating to charities
• Cheque Processing Module
• In Australia, Belgium, Cook Islands, Finland, Germany, Ireland, India, Italy,
New Zealand, Portugal, South Africa, Spain and the United Kingdom, pre-paid
cell phones can be recharged through some ATMs
• ATMs can also act as an advertising channel for companies to advertise their
06/15/2023 Archana S TIM 36
own products or third-party products and services. 
 Electronic funds transfer

“Electronic funds transfer or EFT refers to the

computer-based systems used to perform financial
transactions electronically. “

06/15/2023 Archana S TIM 37

 Features
• Customer can deposit, withdraw and deal with
any branch.
• Transfer with the help of plastic cards
• cardholder-initiated transactions, where a
cardholder makes use of a payment card
• electronic payments by businesses, including
salary payments
• electronic check (or cheque) clearing
06/15/2023 Archana S TIM 38
 Card-based EFT

EFT may be initiated by a cardholder when a payment card such as a

credit card or debit card is used
Transaction types
• Sale
• Withdrawal
• Deposit
• Cashback
• Inter account transfer
• Payment
• Inquiry

06/15/2023 Archana S TIM 39

 Electronic Banking
• Many banks are replacing traditional checks
and deposit slips with electronic fund transfer
(EFT) systems, which utilize sophisticated
computer technology to facilitate banking and
payment needs.
• Routine banking by means of EFT is
considered safer, easier, and more convenient
for customers.

06/15/2023 Archana S TIM 40

• https://www.paisabazaar.com/banking/
difference-between-neft-rtgs-imps/

06/15/2023 Archana S TIM 41

 Electronic Clearing Service

“Electronic Clearing Service is a mode of

electronic funds transfer from one bank
account to another bank account using the
services of a Clearing House set up by
Reserve Bank of India”

06/15/2023 Archana S TIM 42

 The advantages to the banks
• Banks handling ECS get freed of paper handling.
• Paper handling also creates lot of pressure on banks as
they have to encode the instruments, present them in
clearing, monitor their return and follow up with the
concerned bank and customers.
• In ECS banks simply get the payment particulars relating
to their customers. All they need to do is to match the
account particulars like name, a/c number and credit the
proceeds
• Wherever the details do not match, they have to return
it back, as per the procedure
06/15/2023 Archana S TIM 43
Scheme benefit the ECS users -like corporate bodies/ institutions

• The ECS user saves on administrative machinery for

collecting the cheques, monitoring their realization and
reconciliation
• Better cash management.
• Avoids chances of frauds due to fraudulent access to the
paper instruments and encashment.
• Realize the payments on a single date instead of fractured
receipt of payments.
• Ability to make payment and ensure that the
beneficiaries' account gets credited on a designated date. 

06/15/2023 Archana S TIM 44

 Participants in the ECS debit scheme

• Telephone companies
• Electricity supplying companies
• Electricity boards
• Credit card collections
• Collection of loan installments by banks and
financial institutions
• Investment schemes of Mutual funds, etc.

06/15/2023 Archana S TIM 45

 PORTFOLIO MANAGEMENT SERVICES

06/15/2023 Archana S TIM 46

 PORTFOLIO MANAGEMENT

•Portfolio management is essentially a

systematic method of managing one's
investment efficiently.
•Rather than investing the entire
savings in a single security, they invest
in a group of securities. Such a group
of securities is called a portfolio.

06/15/2023 Archana S TIM 47

 SCOPE OF PORTFOLIO MANAGEMENT
SERVICES
• Portfolio management services refers to those services
provided to the investors where in the agency takes the
responsibility of using the funds effectively for maximum
results.
• The agency converts the fund into compatible portfolios
on the basis of the objectives and the constraints of the
investor.
• It continuously evaluates and makes necessary
adjustments for better results.

06/15/2023 Archana S TIM 48

• Portfolio management begins with the
discussion of the investor’s objectives,
constraints and preferences and their
relationship with the available investment
opportunities.
• This leads to a well defined portfolio policy
and strategy statements on the allocation of
funds among various types of assets ,timing of
investments and disinvestments.
06/15/2023 Archana S TIM 49
 TYPES OF PMS

• The PMS being offered by the industry can be

classified into three types. The services differ
on the basis of the discretion lying with the firm
in managing the portfolio.
• 1.Non-discretionary PMS
• 2.Delegated Investment management.
• 3. Optional .

06/15/2023 Archana S TIM 50

 Non-discretionary PMS:

• This service is targeted towards investors who

would like to make their own decisions
regarding the use of their funds-these are
generally large portfolio owners.
• The role of the firm is in the execution of the
order of the investor.

06/15/2023 Archana S TIM 51

 Delegated Investment management:

• This discretionary service is for clients who

would leave the management of their
portfolios to the firm.
• This service is more attractive to the provider
as this gives the firm a freedom to use its
knowledge and judgment.
• The client is interested in better return/
performance of the portfolio.
06/15/2023 Archana S TIM 52
 Optional
• In this kind of service the provider offers a non –
discretionary PMS in the beginning and it gains
expertise and develops in infrastructure, it can
offer any of the two types stated above to the
clients depending on their choice.
• The firms also provides several additional services
such as tax counseling sessions, borrowing against
securities, temporary overdraft facility, across the
counter facility and quarterly meetings of investors.

06/15/2023 Archana S TIM 53

 PORTFOLIO MANAGEMENT
• Return on Investment: Although the RBI guidelines do
not permit the provision of any guaranteed return on
security of the principal, the firms offer a return of 14-
35% to the clients. The return from the clients portfolio
depends on the tenure of association and the market
index.

• Fee Charged: A variety of arrangements exist between

the portfolio manages and their clients with regard o
the fee charged. Some assure a minimum certain rate
of return and no fee is charged unless this return is
generated for the clients.
06/15/2023 Archana S TIM 54
 Lock-in period: This period varies from three months to two years. Some
firms also provide the service without such restrictions .

Investments: Portfolio managers favour the investment of the funds in a

mix of money and capital market instruments. The choice of the
instruments depends on the tax liability and the risk profile of the clients.

Interface with Clients: The intensity of the interface is determined by the

type of PMS acquired by the client. In the case of a non-discretionary
PMS, the interaction is limited to the provision of regular information
about the status of the client’s portfolio

06/15/2023 Archana S TIM 55

 Interface with Brokers and Stock Exchange: Portfolio managers
take the services of brokers for a better investment of funds.
Many firms have in –house brokers. Others take help from a
panel of approved brokers.

Maintenance of Accounts: Under the RBI guidelines on Portfolio

Management, the firms have to maintain separate accounts for
each client. This is followed due to the implications of the
provisions of the Income Tax Act and the Companies Act. Public
sector mutual funds have been exempted from income tax and
the proceedings out of the funds can be distributed among the
investors.
06/15/2023 Archana S TIM 56
 •Enam Asset Management,

•PruICICI Asset Management

•J M Morgan Stanley Retail

06/15/2023 Archana S TIM 57

 STOCK BROKING SERVICES

06/15/2023 Archana S TIM 58

 STOCK BROKING SERVICES
• Stock broker

A stock broker is a regulated professional who

buys and sells shares and other securities
through market makers on behalf of investors.

There are two types of Stock Brokers:

 Full Service Stock Brokers

 Discount Stock Brokers

06/15/2023 Archana S TIM 59

 •Full Service Stock Brokers
Full service brokers will give you advice and investment
recommendations

•. But there is a price to pay for these recommendations

• They do have very high commission fees and are usually

only suitable for investors who have a great deal of money
to invest and who do few trades
06/15/2023 Archana S TIM 60
 Discount Stock Brokers

Discount brokers can answer any investment questions

you may have, but they offer fewer personalized
services for their clients, such as making stock
recommendations or giving you portfolio advice.
•These are the brokers that advices trade with very
low trade commission fees
. When you buy or sell stock, you will be paying this
lower commission rate, which results in the investor,
making more money.
06/15/2023 Archana S TIM 61
 Services

• There are three types of stock broking service.

• Execution-only, which means that the broker will only
carry out the client's instructions to buy or sell.
• Advisory dealing, where the broker advises the client
on which shares to buy and sell, but leaves the final
decision to the investor.
• Discretionary dealing, where the stockbroker
ascertains the client's investment objectives and then
makes all dealing decisions on the client's behalf.

06/15/2023 Archana S TIM 62

 Brokerage terms

• Front office : This is a description of the part

of a brokerage firm that is "client facing".
• The sales staff, brokers and traders are part of
the front office.
• Functions of the front office include
acquisition and entry of orders, fulfillment of
the orders, and all the regulatory reporting for
the orders.

06/15/2023 Archana S TIM 63

 • Back office: The back office is where the
clearance processing of the trade is done.
• Transfer of securities and money and the
tracking of "failure to deliver" is handled.
• Securities lending for a brokerage firm,
wherein shares of a security that is being sold
short are located to ensure they can be
delivered, is usually included in the back office
as well.

06/15/2023 Archana S TIM 64

 • Bulls: A bull is a term used in the stock
exchange market to refer to a stock market
optimist who believes that share prices are
likely to go higher, and who acts according to
his investment operations.

06/15/2023 Archana S TIM 65

 CONSUMER CREDIT

06/15/2023 Archana S TIM 66

 CONSUMER CREDIT

• Consumer credit includes all asset—based financing plans

offered to primarily individuals to acquire durable
consumer goods.
• In a consumer credit transaction, the individual-
consumer-buyer pays a fraction of the cash purchase at
the time of the delivery of the asset and pays the balance
with interest over a specified period of time. The main
suppliers of consumer credit are
• foreign/multinational banks, commercial banks and
finance companies.
• There is no specific legislation to regulate consumer credit
in India.
06/15/2023 Archana S TIM 67
 SALIENT FEATURES

• The salient features of consumer credit are:

1.Parties to the transaction

2.Structure of the transaction
3.Mode of payment
4.Repayment period and rate of interest
5.Security

06/15/2023 Archana S TIM 68

 Parties to the transaction
• The parties to a consumer credit transaction
depends upon the nature of the transaction.
• In a bipartite arrangement, there are two
parties, namely, borrower-cum-customer and
dealer-cum-financier.
• In a tripartite arrangement, the parties are
dealer , financier and the customer. The dealer
in this type of arrangement arranges the credit
from the financier.
06/15/2023 Archana S TIM 69
 Structure of the transaction

• A consumer credit arrangement can be structured in three ways.

• Hire-purchaseThe buyer takes possession of goods immediately
and agrees to pay the total price in installments.Ownership of
goods passes from the seller to the buyer on the payment of the
last installment . The hirer has the right to terminate the
agreement any time before the property passes
• Conditional sale: The ownership is not transferred to the customer
until the total purchase price including the credit charge is priced.
The consumer cannot terminate the agreement before the payment
of the full price.
• Credit sale: The ownership is transferred to the customer on the
payment of the first instalment. He cannot cancel the agreement.
06/15/2023 Archana S TIM 70
 Mode of payment
• The consumer credit arrangements fall into
two groups:

Down payment schemes

Deposit-linked schemes

06/15/2023 Archana S TIM 71

 • Repayment period and rate of interest: The
repayment period ranges between 12-60 monthly
installments. The rate of interest is normally
expressed at a flat rate.

• Security: It is generally in the form of a first charge on

the asset. The consumer cannot
sell/pledge/hypothecate the asset.

06/15/2023 Archana S TIM 72

 HIRE PURCHASE FINANCE

06/15/2023 Archana S TIM 73

 Introduction
• Hire purchase is a method of selling goods.
• Creditor and Hirer
• Singer Manufacturing Company started the hire
purchase agreement.
• The organized sector and the unorganized
sector are engaged in the hire purchase
business

06/15/2023 Archana S TIM 74

 FEATURES
• Each installment is treated as hire charges

• The buyer takes possession of goods immediately and

agrees to pay the total price in installments.

• Ownership of goods passes from the seller to the

buyer on the payment of the last installment

• The buyer makes any default in the payment of any

installment the seller has the right to repossess the
goods the from the buyer and forfeit the amount
06/15/2023 Archana S TIM 75
 • The hirer has the right to terminate the agreement
any time before the property passes
• He has the option to return the goods in which case
he need not pay installments falling due thereafter.

DEFINITION

• The Hire Purchase Act, 1972 defines a hire purchase

agreement as, an agreement under which goods are
let on hire and under which the hirer has an option to
purchase them in accordance with the terms of
agreement under which:
06/15/2023 Archana S TIM 76
 • Specified period for payment
• Each installment is treated as hire charges
• Ownership of the goods transferred only after the
payment of installment.
• Possession is delivered to the purchaser at the time
of entering into a contract.
• Right to repossess the goods and forfeit amount
already received treating it as hire charges.
• Right to terminate the agreement.
06/15/2023 Archana S TIM 77
 HIRE PURCHASE AGREEMENT

• Creditor and hirer

• Sufficient description about the goods
• Price of goods
• Date of commencement of agreement
• No: of installment, amount, and due date

06/15/2023 Archana S TIM 78

 HIRE PURCHASE AND CREDIT SALE

• In hire purchase until the last payment the

ownership remains with the seller.

• In credit sale the title in the property is

transferred to the purchase simultaneously.

06/15/2023 Archana S TIM 79

 BANKS CREDIT FOR HIRE PURCHASE BUSINESS

The subsidiary of commercial banks lend to the

dealer or to finance intermediary who has
already financed articles sold by the dealer to
the hirer under a hire-purchase contract.
Procedures are:
• Customer
• Purpose

06/15/2023 Archana S TIM 80

• Amount
• Period
• Repayment
• Security
• Monitoring and Control

06/15/2023 Archana S TIM 81

 Housing Finance System

The Central Government has set up Housing

and Urban Development Corporation
(HUDCO) to finance and undertake housing
and urban development programmers,
development of land for satellite towns,
besides setting up of a building materials
industries.

06/15/2023 Archana S TIM 82

 Objectives
• to provide long-term finance for construction
of houses for residential purpose and urban
development programmers
• To finance or undertake the setting-up of new
satellite towns.
• To finance or undertake the setting-up of the
building materials industries.
06/15/2023 Archana S TIM 83
 Conti………

The principle mandate of the HUDCO was to

ameliorate the housing conditions of the low
income group (LIG) and economically weaker
sections (EWS).

06/15/2023 Archana S TIM 84

 • The HUDCO was established with an equity base of
Rs2 crores.
• They extends assistance, benefiting masses in urban
and rural areas, under a broad spectrum of
programmes.
They are
• Housing :- Rural housing, cooperative housing, urban
employment through housing and shelter up gradation

06/15/2023 Archana S TIM 85

• Infrastructure
Land acquisition, basic sanitation and
environmental improvement of slums.
• Consultancy Services
Building centers for technology transfer,
building materials industries and building
technology.
06/15/2023 Archana S TIM 86
• Training
Training in human settlements and technical
assistance to all borrowing agencies.
• The LIC and GIC support housing activity both
directly or indirectly.

06/15/2023 Archana S TIM 87

• Commercial banks
According to RBI guidelines, scheduled commercial banks are
required to allocate 1.5% of their incremental deposits for
disbursing as housing finance every year.
• Cooperative Banks
Consists of state cooperative bands, District Central Cooperative
banks ,finance by individuals, cooperative group housing
societies
• Specialized Housing Finance Institutions
- Caters only to the need of housing sector
- -e.g HDFC ltd

06/15/2023 Archana S TIM 88

 Internet banking

06/15/2023 Archana S TIM 89

 • Internet banking(on line banking) allows
customers to conduct financial transactions on
a secure website operated by their retail or
virtual bank, credit union or building society.
Internet banking involves use of Internet for
delivery of banking products & services
• Internet banking is increasingly becoming a
"need to have" than a "nice to have" service.

06/15/2023 Archana S TIM 90

 • Internet banking is one more channel, one
more access point like an automated teller
machine or a call centre from where a
customer can transact business for which
earlier he used to go to a bank branch.
• Internet is the cheapest of all banking
channels and helps bank to gain substantially
in terms of transaction costs.
 
06/15/2023 Archana S TIM 91
 A successful Internet banking solution offers
• Exceptional rates on savings,CDs
• Checking with no monthly fee, free bill payment
and rebate on ATM surcharges
• Credit cards with low rates
• Easy online applications for all accounts,
including personal loans and mortgages
• 24 hour account access
• Quality customer services with personal
attention
06/15/2023 Archana S TIM 92
 The six primary drivers of Internet banking
includes
• Improve customer access
• Facilitate the offering of more services
• Increase customer loyalty
• Attract new customers
• Provide services offered by competitors
• · Reduce customer attrition
06/15/2023 Archana S TIM 93
 Main concerns in internet banking

• Security is the most important issue of online

banking. . There is a dual requirement to
protect customers' privacy and protect against
fraud A multi-layered security architecture
comprising firewalls, filtering routers,
encryption and digital certification ensures
that your account information is protected
from unauthorized access:

06/15/2023 Archana S TIM 94

• Firewalls and filtering routers ensure that only the
legitimate Internet users are allowed to access the
system.
• Encryption techniques used by the bank (including
the sophisticated public key encryption) would
ensure that privacy of data flowing between the
browser and the Infinity system is protected.
• Digital certification procedures provide the
assurance that the data you receive is from the
Infinity system
06/15/2023 Archana S TIM 95
 Virtual banking

• A virtual bank is a bank with a very small or

nonexistent branch network.
• By eliminating the costs associated with retail
banking, particularly bank branches, virtual
banks may offer higher interest rates and
lower service charges on their savings
accounts than their competitors.

06/15/2023 Archana S TIM 96

 It offers its financial services by:
• Telephone banking
• Online banking
• Automated teller machines
• Mail banking
• Mobile banking

06/15/2023 Archana S TIM 97

 List of virtual banks

• Bank of Internet (United States)

• Citi Direct, a division of Citibank (United
States)
• Ebank (United States)
• HSBC Direct, a division of HSBC Bank USA
(United States)
• ING Direct, part of ING Group (worldwide

06/15/2023 Archana S TIM 98

 Telephone banking
• Telephone banking is a service provided by a
financial institution which allows its customers
to perform transactions over the telephone

06/15/2023 Archana S TIM 99

 Automated teller machine (ATM

• An automated teller machine (ATM) is a

computerized telecommunications device that
provides the customers of a financial
institution with access to financial transactions
in a public space without the need for a
human clerk or bank teller

06/15/2023 Archana S TIM 100

 Mail banking
• Mail banking is a service provided by a financial
institution which allows its customers to deposit
cheques into their account by mail.
• It is primarily used by virtual banks (as they may
not offer branches or ATMs that accept deposits)
and by customers who live too far from a branch.
• Typically, the institution that advertises such a
service will provide its own self-addressed
stamped envelopes as a courtesy
06/15/2023 Archana S TIM 101
 Mobile banking

• ‘’Mobile Banking refers to provision and

availment of banking- and financial services
with the help of mobile telecommunication
devices. The scope of offered services may
include facilities to conduct bank and stock
market transactions, to administer accounts
and to access customised information."

06/15/2023 Archana S TIM 102

 Mobile Banking Services
• Account Information
• Payments, Deposits, Withdrawals, and
Transfers
• Investments
• Support
• Contented Services

06/15/2023 Archana S TIM 103

 Thank you…!
06/15/2023 Archana S TIM 104