Sign Banking Presentation Montana Simple

Industry sign banking alabama presentation simple

hello everyone this is ankur chaudhary from hitbullseye.com and in this lecture i'll be talking to you about the banking sector in india first let us try and understand what banking is all about so banking can be defined as the business activity of accepting and safeguarding the money owned by other individuals and entities and then lending out this money in order to earn a profit so this is a very basic definition but one thing that you have to always keep in mind that banks are in the market to earn a profit now let us try and understand how these banks earn this profit so there are savers in any economy these savers include individuals companies and the government itself right they deposit their money into different banks right and banks are giving out this money to borrowers right and the borrowers also include the same set of people that are the savers so individuals companies and the government borrows from the banks now banks have to pay this money back to the savers with some interests also borrowers pay back the banks the principal plus interest right but there is a difference between the interest paid by the borrowers to the banks and the banks to the savers so this interest is always greater for borrowers as compared to savers right so the difference due to the difference between these two interest rates banks make a profit which is also known as spread so now that we understand how banks make money let us take a look at the primary and secondary functions of banks primary functions the broad heads are accepting deposits and granting loans and advances right so these are the different accounts which we'll be talking about in detail in subsequent slides right and then there are cash credit bank overdraft loans bill discounting etc right so these are various instruments or various functions that the banks are performing now let us look at the secondary functions of banks first are of course agency functions then the utility functions so various functions under agency function are funds transfer check collection periodic payment collection portfolio management and some other miscellaneous functions as well as far as utility functions are concerned we have issue of drafts locker underwriting of shares foreign exchange forming or developing project reports and various social reform welfare programs as instructed by the reserve bank of india or the government of india now all these functions are important you have to basically understand what they are all about and these are important for as far as your paper is concerned now let us look at the various different types of accounts that can be opened in any bank in india first and very popular one is the savings bank account right as the name suggests the main objective is to promote savings so as far as saving bank account is concerned there are there is no restriction on the number and amount of deposits that you make in this account so you can put in the any amount of money any number of times in this account and you will not be charged for that however there are limitations as far as withdrawal are concerned so technically speaking any bank can limit the number of withdrawals that you can make in the saving bank account but in india hardly any bank does so because of very high level of competition in the banking industry next low no loan facilities is provided against a saving account a special type of saving bank account is a no frills account so in this account you will not be charged anything by the bank for opening such an account however you will not be getting basic facilities like maybe net banking uh debit card credit card etc right so there are no frills attached in this particular type of saving bank account next type of bank account is the current account it is most liquid account as there is no limit on the number of transactions so you can amount any amount of money for any any number of times and also you can withdraw this money any number of times without any restrictions right however there is a penalty charge if minimum balance is not maintained in such an account right so there is a minimum balance account that you have to keep in this particular account right generally speaking banks do not pay any interest on the current account however in today's market scenario of very high level of competition some banks have started paying some minimal interest or nominal interest on current account as well right and banks charge a fee for current accounts right so current account is most suitable for the answer is businessmen this is so because businessmen would want to deposit a lot of money a large number of times perhaps every single day at the end of the day and also would want to continuously keep withdrawing money from the account so that is why they prefer current accounts generally next type of account is a very famous one of course is the fixed deposit or fd account amount in this particular type of account can be deposited deposited only once right premature withdrawal is allowed in some banks without penalty however certain other banks charge a penalty for premature withdrawal of an ft this account is very significant because customers can avail loans against fds up to 80 to 90 percent of the value of deposits so how fd functions i'm sure most of you will be knowing but you deposit the money once in an account for a maturity period of let us say five to ten years right and after that you can withdraw this amount which will include your principal as well as interest as well right next type of account is the recurring deposit account so in this particular account you have to make a deposit after a fixed interval of time so let us say you put in 1 000 rupees every month or 4 000 rupees every quarter right the interest rate that you earn on a recurring deposit account is the same as fixed deposit account right so either you can fix uh you can have a fixed installment that is 1000 rupees per month or you can have variable installments as well so one month you put in 1 000 next month you put in 2000 and so on and so forth right however no withdrawals are allowed but some banks do allow closure of the account before the maturity period these banks generally charge a penalty rate for closing such an account so during the course of this video presentation we saw what banking is all about secondly how banks earn money thirdly we understood the primary and secondary functions of banks and lastly we spoke about four very important types of accounts as far as banking is concerned thank you very much you