Banks are not just institutions for storing money and lending, they also provide a range of financial services to customers. These services are commonly referred to as para-banking or financial services activities. In this response, we will discuss some of the financial services activities undertaken by banks.
- Wealth Management: Wealth management is a service provided by banks to high net worth individuals (HNIs) to manage their wealth and investments. Banks offer services such as investment advice, portfolio management, and financial planning to their wealth management clients.
- Insurance Services: Banks offer insurance services to their customers in collaboration with insurance companies. These services include selling insurance policies such as life insurance, health insurance, and motor insurance.
- Mutual Fund Services: Banks offer mutual fund services to their customers, where customers can invest in mutual funds directly through the bank. Banks also offer advisory services for mutual fund investments.
- Credit Cards: Banks offer credit cards to their customers, which can be used for making purchases and payments. Credit cards also offer benefits such as cashback, rewards, and discounts on purchases.
- Forex Services: Banks offer forex services to their customers, including foreign currency exchange, travel cards, and remittance services.
- Online Trading: Banks offer online trading services to their customers, allowing them to trade in stocks, bonds, and other securities through the bank’s trading platform.
- Merchant Services: Banks offer merchant services to businesses, allowing them to accept credit and debit card payments from customers.
- Depository Services: Banks offer depository services to customers, where they can hold securities in dematerialized form.
In conclusion, banks offer a range of financial services activities to their customers, including wealth management, insurance, mutual funds, credit cards, forex services, online trading, merchant services, and depository services. These services provide convenience and value to customers, and also help banks generate additional revenue streams.