Some examples of banking products are

Some examples of banking products are

What are some examples of bank products and services?

Now let’s start with an introduction to banking products to be successful in banking any bank has to understand different segments and develop appropriate products to be offered to the customer.

As per the requirement as need. So the products offered by banks like the debit card credit card or you can say the deposit products like current account saving account your fixed deposit account, as well as providing the check and facilitating transactions through the internet banking,

All those are the products of the bank, and they are offered to the customer as per their needs. Now today banks are also involved in offering mutual fund insurance products somewhere to suit customer’s needs water, which all are the requirements of the customer to satisfy the customer.

Now, we need to understand the core basic banking products to get an understanding of the banking system in India, and what products are offered by the bank to their customer.

It’s often customized by the banks to create differentiation from competitors and create a position in the customer’s mind. Now since the core, or what we say basic banking products that remain the same among all the Macs,

What are the banking products

But then also bank try to create differentiation because of. It has been a competitive banking scenario where there are major private players like HDFC ICICI ICICI Bank, who are performing well in the sector.

And then there are many public sector banks, as well, so there is stiff competition in the market. And for this reason, we always see that banks try to create a customized product for this, for their customers or they try to improve their services so that their customers remain with them.

Now, for example, SPI came with this app. It was also intended to provide most of the banking services to win up to the customer, which could, which could make the customer more reliable on SBI services, and could make them more visible in making the transactions.

This is how banking products play an important role and it has been a step towards creating differentiation from other competitors and making a position in the customer’s mind.

We can broadly categorize banking products as deposit products credit products and third-party products, excluding the services provided by the bank to remittances and augmented products.

We will be covering three major categories of banking products that are deposit product credit product and third party products. We want to be covering the financial services provided by the bank like portfolio management services remittance services like fund grants for any FDI MPs,

And augmented services like through ATM and internet banking. We will be studying banking products only, so let’s see one by one.

Audit  bank as I already said we will be learning about three major categories, the deposit product, the credit product, and the third party product, we can classify deposit product as demand deposit and term deposit.

What are the banking services

Now demand deposit You must have heard in simpler terms as Casa account that his current account and savings account. Don’t because it is nothing but your fixed deposit account or recurring deposit which you hold

With your bank credit products are all the retail loans like auto worker loan home loan education loan etc. Personal Loans as well, and business loans, like term loans working after loan cash credit overdrafts and all third party products, could be a mutual fund, insurance, which are sold by the bank.

Now let’s understand deposit products are often referred to as liability product as it creates a liability on the bank in the form of fun, they owe to their customers or depositors.

Whenever you deposit your money in the bank that deposited fund is like liability for the bank. Because the bank has to pay that money back to you. And along with your money bank also pays you certain interest with that.

Now, that’s why it is a liability it increases the cost of the bank, and also it was like an obligation to pay back to the customer, or the depositor. So, it is often referred to as a liability product. Now when banks,

Accept deposit its liability increases that’s obvious because of deposit products. The bank has to pay interest on it, it is increasing liability, as well as the bank also has to pay back the fund to the positives. And that and that’s how the causal products work.

Now, first, we read about demand deposit so in the deposit products we should we saw two categories first was demand deposit and second verse term deposit so we will start with demand deposit demand deposits are defined

A deposit payable on demand through cheque, or otherwise, from your it got its name, it is called demand deposit because you can always ask for these deposits and it will be payable to you by the bank.

The mind deposit comprises of current account and savings account. This is also the major source of income for any bank major source of funding for any bank because the bank gets a lot of money which they use to provide loans, and for other financial services is from Casa account,

Only saving an account or saving a deposit is primarily meant for developing this habit of saving among the public. It enables depositors to earn interest on the amount held in account facilitates various online financial transactions transfer money to withdraw money from ATM internet banking, etc.

What are the 5 most important banking services

All these facilities are provided to you when you open a savings account, which is termed as a saving deposit also because in that account you hold your money. And that was intended mainly to develop a habit of saving among the public.

And along with that saving account, you do various financial transactions you can transfer money, you can withdraw money from ATM, and you can do internet banking, etc

There are many services provided along with that saving account, and the fund you hold in that saving deposit also makes you earn interest of about three to 4% depending on the bank yearly

Now savings account passbook even acts as an identity and residential proof of the account holder so saving upon passcode. You must have seen that it acts as your identity document among, various ways and it is it also acts as a residential proof of yours.

The second one is a current account or current deposit. This is another form of demand deposit. It is generally for business purpose wherein there is no restriction on the number of withdrawals in the account ob

One thing that is different in the current account or current deposit from saving account or saving because it is that in saving accounts, you were having restrictions on the number of withdrawals, you can do

You can do unlimited withdrawals with your account. But here in current accounts since it is made for business purposes, and when you are in a business need you to need to do a lot many financial transactions for

That you need to have no restriction on the withdrawal on the number of withdrawals and that’s fine current account current deposit there is no restriction or number of withdrawals in the account

You can withdraw money as many times as you want, and banks do not pay any interest on current deposits so this is also watched a friend and savings account and current account so here in current account or current deposit bank does not pay any interest while we saw that in savings account interest was paid early.

In the current account, banks do not be This was also for the reason that you’re the maintenance cost is quite high, because you are allowed to make unlimited withdrawals, and you are given many facilities like overdraft and cash credit through your current account.

Now checkbooks are also issued in all current accounts and savings accounts you can have checkbooks on demand.

Second is a deposit product of ours is a term deposit a term deposit is a deposit received by the bank for a fixed period, after which it can be withdrawn, interest rates on term deposits are usually higher than on shaving deposit.

Till now we saw about to demand deposit there. The in saving account there was very limited interest provided in the current account no interest was provided now term deposit came as a product which you provided a good interest rate to the public.

It was around six to 8% provided and do this was for a fixed period, after which the money can be withdrawn so it was not like saving or current account where you can withdraw money as per your wish your, you can withdraw money only after a fixed period only on the majority of your term period.

The interest rate provided on term deposits was usually higher. This has to do this held as wealth creation for the public.

A fixed deposit is a term deposit on which a fixed rate of interest is paid at regular intervals fixed deposits are generally for 12 months or more. So, a fixed deposit is a type of term deposit where we hold our money for more than funnier.

After the maturity of which we can withdraw money and get a good interest rate as provided by the bank about six to 7%. And second is a recurring deposit. This is another deposit scheme under which a fixed amount is deposited at regular intervals for a fixed term and

The repayment of principal and accumulated interest is made at the end of the term. So in fixed deposit, what do we, we deposit our money in a lump sum amount in new at one time, but in a recurring deposit, we can deposit our money at regular intervals,

And we will be getting the accumulated interest and the principal together at the end of the term, or what you see on the maturity period.

Now let’s see about the credit products. So credit products are often referred to as a set product as it creates income for a bank in form of interest, it’s asked to their customers or borrowers. So when we talked about deposit product,

It was referred to as liability products because the bank has to pay interest on this now credit products is opposite here Brian earns interest from the borrower’s banks charges interest from the borrower.

This serves as an income for the bank, and that these products are referred to as a set product because it works as an asset for the bank when banks provide loans, its asset increases as it earns interest through EMI from the borrower.

EMI which you pay when you have taken a loan, a pencil test as well as your principal amount. So the interest is the extra amount that the bank is getting, and that’s such as the income for the bank, and thus it is treated as an asset for the bank does all credit products are reported as a sidecar

The first is retail loads we saw two categories of the credit products also first were retail loan second was a business loan. So the retail loan is what the bank offers a range of retailer set products including home loan, your regular loan personal loan for marriage medical expenses credit card consumer loans.

If you have to purchase any consumer goods such as a TV laptop, etc. loans are also provided against your time deposit that is a fixed deposit, and a loan against shares.

These all are retail loan products which are offered by the bank to the public in normal and new. And these facilitate a large number of. products of any bank because these are the most demanded load products.

Now, the second category was business loans bank offer business term loans with longer repayment period, and set payment should do. Normally these loans are extended for three to 20 years and used for business expansion modules machinery porches etc.

The business loan we can categorize as our long-term loan which is also referred to as a business term loan which is provided for various purposes which involves a huge amount of money like for business expansion for any merger for purchase of machinery

For the setup of another factory etc. And second is a working capital loan which is granted, which is granted to the business to meet their short-term obligation and operational activities. Now cash credit and overdrafts are

Other examples of short-term loans provided to the businesses by the bank. Now, these loans together are termed as asset products because the banks charge interest on these credit products these higher loans

Than what banks provide to their depositors, so the interest provided to the depositors is somewhere between three to 4%. However, the interest charged on these loan products is somewhere between eight to 14% depending on the type of loan.

And as you can see the difference between the interest rate is called interest spread and itself as profitability for any bank.

Let’s talk about third party products distribution of third party products like mutual funds and insurance has emerged as a key driver of revenue in form of commission and fees for banks in modern times.

It has been a new concept bank has been involved in selling off third party products which are more in demand. Today people are going for your mutual fund investments a lot. So banks get involved in the selling of mutual funds because the public is having the kind of trust on

The banks, as compared to any other private companies and these banks try to provide them mutual funds and make them invest in the products which are linked to the market. There they can earn a good amount of interest

And insurance is also provided by banks so these have emerged as a key driver of revenue for the bank because the banks are earning revenue in form of commission they charge in form of fees they charge for selling these products.

The concept of selling products, other than banking products is called para banking. So these products are not the core banking products, these are, these are the third party products that are banks getting involved in selling.

That’s it has been given a separate name called para banking and the Reserve Bank of India has prescribed rules and regulations for carrying out these activities. So these are also on the regulations of RBI which is the central bank of India controlling

All these should use commercial banks, mutual fund insurance is offered by the bank, either by setting the setting separate department or owning a subsidiary, so banks could also own there can also have their subsidiary to save these products, or they can create a separate demand and department, sorry.

It is Mutual Fund Schemes like equity fund debt fund hybrid fund, and so on are offered by banks to the customer to make them on market linked to investing, and both life as well as general insurance policies for general insurance policies and non-life policies like your health insurance vehicle insurance machinery machines insurance and

All which are offered as a loss covered against risk, and various Mutual Fund Schemes are they’re broadly categorized as equity funded fund and hybrid I also offer to the customers as per their need do it has been in a very new concept for the banks to earn fee-based income to earn commission-based income by selling these products.

The mind deposit comprises of current account and savings account. This is also the major source of income for any bank major source of funding for any bank because the bank gets a lot of money which they use to provide loans, and for other financial services is from Casa account,

Only saving an account or saving a deposit is primarily meant for developing this habit of saving among the public. It enables depositors to earn interest on the amount held in account facilitates various online financial transactions transfer money to withdraw money from ATM internet banking, etc.

All these facilities are provided to you when you open a savings account, which is termed as a saving deposit also because in that account you hold your money. And that was intended mainly to develop a habit of saving among the public.

And along with that saving account, you do various financial transactions you can transfer money, you can withdraw money from ATM, and you can do internet banking, etc

There are many services provided along with that saving account, and the fund you hold in that saving deposit also makes you earn interest of about three to 4% depending on the bank yearly

Now savings account passbook even acts as an identity and residential proof of the account holder so saving upon pass-code. You must have seen that it acts as your identity document among, various ways and it is it also acts as a residential proof of yours.

The second one is a current account or current deposit. This is another form of demand deposit. It is generally for business purpose wherein there is no restriction on the number of withdrawals in the account ob

One thing that is different in the current account or current deposit from saving account or saving because it is that in saving accounts, you were having restrictions on the number of withdrawals, you can do

You can do unlimited withdrawals with your account. But here in current accounts since it is made for business purposes, and when you are in a business need you to need to do a lot many financial transactions for

That you need to have no restriction on the withdrawal on the number of withdrawals and that’s fine current account current deposit there is no restriction or number of withdrawals in the account

You can withdraw money as many times as you want, and banks do not pay any interest on current deposits so this is also watched a friend and savings account and current account so here in current account or current deposit bank does not pay any interest while we saw that in savings account interest was paid early.

In the current account, banks do not be This was also for the reason that you’re the maintenance cost is quite high, because you are allowed to make unlimited withdrawals, and you are given many facilities like overdraft and cash credit through your current account.

Now checkbooks are also issued in all current accounts and savings accounts you can have checkbooks on demand.

Second is a deposit product of ours is a term deposit a term deposit is a deposit received by the bank for a fixed period, after which it can be withdrawn, interest rates on term deposits are usually higher than on shaving deposit.

Till now we saw about to demand deposit there. The in saving account there was very limited interest provided in the current account no interest was provided now term deposit came as a product which you provided a good interest rate to the public.

It was around six to 8% provided and do this was for a fixed period, after which the money can be withdrawn so it was not like saving or current account where you can withdraw money as per your wish your, you can withdraw money only after a fixed period only on the majority of your term period.

The interest rate provided on term deposits was usually higher. This has to do this held as wealth creation for the public.

A fixed deposit is a term deposit on which a fixed rate of interest is paid at regular intervals fixed deposits are generally for 12 months or more. So, a fixed deposit is a type of term deposit where we hold our money for more than funnier.

After the maturity of which we can withdraw money and get a good interest rate as provided by the bank about six to 7%. And second is a recurring deposit. This is another deposit scheme under which a fixed amount is deposited at regular intervals for a fixed term and

The repayment of principal and accumulated interest is made at the end of the term. So in fixed deposit, what do we, we deposit our money in a lump sum amount in new at one time, but in a recurring deposit, we can deposit our money at regular intervals,

And we will be getting the accumulated interest and the principal together at the end of the term, or what you see on the maturity period.

Now let’s see about the credit products. So credit products are often referred to as a set product as it creates income for a bank in form of interest, it’s asked to their customers or borrowers. So when we talked about deposit product,

It was referred to as liability products because the bank has to pay interest on this now credit products is opposite here Brian earns interest from the borrower’s banks charges interest from the borrower.

This serves as an income for the bank, and that these products are referred to as a set product because it works as an asset for the bank when banks provide loans, its asset increases as it earns interest through EMI from the borrower.

EMI which you pay when you have taken a loan, a pencil test as well as your principal amount. So the interest is the extra amount that the bank is getting, and that’s such as the income for the bank, and thus it is treated as an asset for the bank does all credit products are reported as a sidecar

The first is retail loads we saw two categories of the credit products also first were retail loan second was a business loan. So the retail loan is what the bank offers a range of retailer set products including home loan, your regular loan personal loan for marriage medical expenses credit card consumer loans.

If you have to purchase any consumer goods such as a TV laptop, etc. loans are also provided against your time deposit that is a fixed deposit, and a loan against shares.

These all are retail loan products which are offered by the bank to the public in normal and new. And these facilitate a large number of. products of any bank because these are the most demanded load products.

Now, the second category was business loans bank offer business term loans with longer repayment period, and set payment should do. Normally these loans are extended for three to 20 years and used for business expansion modules machinery porches etc.

The business loan we can categorize as our long-term loan which is also referred to as a business term loan which is provided for various purposes which involves a huge amount of money like for business expansion for any merger for purchase of machinery

For the setup of another factory etc. And second is a working capital loan which is granted, which is granted to the business to meet their short-term obligation and operational activities. Now cash credit and overdrafts are

Other examples of short-term loans provided to the businesses by the bank. Now, these loans together are termed as asset products because the banks charge interest on these credit products these higher loans

Than what banks provide to their depositors, so the interest provided to the depositors is somewhere between three to 4%. However, the interest charged on these loan products is somewhere between eight to 14% depending on the type of loan.

And as you can see the difference between the interest rate is called interest spread and itself as profitability for any bank.

Let’s talk about third party products distribution of third party products like mutual funds and insurance has emerged as a key driver of revenue in form of commission and fees for banks in modern times.

It has been a new concept bank has been involved in selling off third party products which are more in demand. Today people are going for your mutual fund investments a lot. So banks get involved in the selling of mutual funds because the public is having the kind of trust on

The banks, as compared to any other private companies and these banks try to provide them mutual funds and make them invest in the products which are linked to the market. There they can earn a good amount of interest

And insurance is also provided by banks so these have emerged as a key driver of revenue for the bank because the banks are earning revenue in form of commission they charge in form of fees they charge for selling these products.

The concept of selling products, other than banking products is called para banking. So these products are not the core banking products, these are, these are the third party products that are banks getting involved in selling.

That’s it has been given a separate name called para banking and the Reserve Bank of India has prescribed rules and regulations for carrying out these activities. So these are also on the regulations of RBI which is the central bank of India controlling

All these should use commercial banks, mutual fund insurance is offered by the bank, either by setting the setting separate department or owning a subsidiary, so banks could also own there can also have their subsidiary to save these products, or they can create a separate demand and department, sorry.

It is Mutual Fund Schemes like equity fund debt fund hybrid fund, and so on are offered by banks to the customer to make them on market linked to investing, and both life as well as general insurance policies for general insurance policies and non-life policies like your health insurance vehicle insurance machinery machines insurance and

All which are offered as a loss covered against risk, and various Mutual Fund Schemes are they’re broadly categorized as equity funded fund and hybrid I also offer to the customers as per their need do it has been in a very new concept for the banks to earn fee-based income to earn commission-based income by selling these products.