In today’s article, we will discuss briefly about various services offered by the banks.
- Primarily banks accept deposits and provide loans and advances while earning interest rate differential between the two activities.
With these being major functions, there are other services banks provide for which they charge fees, commission, charges, brokerage etc. We will discuss about various loan schemes offered by banks in another article.
- Payment services:
Banks provide various payment services to their clients like cheques, drafts (demand drafts / bank drafts), pay orders, electronic payment services like NEFT, RTGS, IMPS, UPI, SWIFT etc., credit cards, debit cards, ATMs, POS machine services etc.
Without payment services our routine life will halt. Banks generally levy bank charges or fees for such services.
- Foreign Exchange services:
Banks also provide various foreign exchange services to their client like currency exchange-buy-sell, currency management, currency hedging, currency derivatives etc. Banks generally charge fees / brokerage / commission on such services.
- Distribution of financial products:
Today many banks earn their significant income from distribution of financial products like insurance, mutual funds etc. With their wide reach banks are able to reach to the last customer of the country and in turn provide access to financial products to everyone. Banks generally don’t charge customers for these services instead gets commission income from financial service providers.
- Advisory services:
Today many banks are providing various consultancy and advisory services like investment banking, financial advisory, wealth management, treasury management, project management etc. Banks charge fees from the clients for proving these kind of services.
- Other services:
Banks have wide network, healthy financial and commercial ties with business entities and financial companies and trustworthiness among general public. Hence, people / businesses entrust banks to provide multiple services like locker facility, collateral management, trustee services, custodian services, depository etc.
We will discuss about above services in detail in further articles. You can put in your comments about feedback to the above article or your expectations for the coming articles.
– By Tejas Patel