What is Investment Banking

Investments are the foundation of all financial matters and dealings, as it provides stability to the economic decisions at different levels .We have two options regarding our money .Firstly we can spend it, secondly we can save it or invest it. Best way to do investment is banking, as the aim of the banking services is to provide security and bring confidence in the economy.

The UK Banking system refers to the network of personal and business bank accounts that help deposit and lend consumers money. We find different aspects in the UK Banking System such as; High street banking which provides services to the general public. The Second aspect of UK banking system is business banking that operates similar to ordinary accounts, but has more services and more fees. Business banking looks for the best way to invest money through knowledge of different bond markets, exchange rate markets and the stock market. In the UK, The Bank of England is responsible for Monetary Policy.

A Mortgage Bank specializes in originating or servicing mortgage loans. It is a state-licensed banking entity that makes mortgage loans directly to consumers. The difference between a mortgage banker and a mortgage broker is that the mortgage banker is one who funds loans with its own capital.

Term Private banking is used for investment and other financial services which are provided by the banks to private individuals on investing sizable assets. Private banking has been viewed as very exclusive, only catering for high net worth individuals with very high liquidity.

All the commercial and banking needs of international finance are deal by the merchant banks. Merchant banks do not have retail offices where a customer can go and open or check his/her account. A merchant bank is sometimes called as wholesale bank, or investment bank, because merchant banks primarily deal with other merchant banks and other large financial institute.

The difference between commercial bank and merchant bank lies between the services they provided, and to whom they provided. Merchant bank do not provide regular banking services to the general public as they are not accessible for general banking need while they serve large companies and wealthy individuals. Merchant fees are fees associated with processing of credit cards. Different credit cards have different merchant fees, which are depend on the deals negotiated with banks which handle merchant accounts.

Investment through banking is a wise decision for the future’s successful life .To get the maximum benefits from the investment, it is suggested that to make a long term investment, as investment is a game of time which only can be won through slowly and steadily efforts. Because the only problem about stock market is that nobody can predict that what will be happening next. But the key thing is that long term direction of the market is upward. It will facilitate the investor at different stages of his/her life.

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Mobile Banking - Definition and advantages

In today world Mobile Banking is a popular term. Mobile Banking means a financial transaction conducted by logging on to a bank's website using a cell phone, such as viewing account balances, making transfers between accounts, or paying bills. It is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone. In recent time Mobile banking is most often performed via SMS or the Mobile Internet but can also use special programs called clients downloaded to the mobile device. Mobile Banking concept In general term we can categorized the mobile banking below - * Mobile Accounting * Mobile Brokerage * Mobile Financial Information Services Most services in the categories designated Accounting and Brokerage are transaction-based. The non-transaction-based services of an informational nature are however essential for conducting transactions - for instance, balance inquiries might be needed before committing a money remittance. Mobile Banking Services Mobile banking can offer services such as the following: * Mini-statements and checking of account history * Alerts on account activity or passing of set thresholds * Monitoring of term deposits * Access to loan statements * Access to card statements * Mutual funds / equity statements * Insurance policy management * Pension plan management * Status on cheque, stop payment on cheque * Ordering check books * Balance checking in the account * Recent transactions * Due date of payment (functionality for stop, change and deleting of payments) * PIN provision, Change of PIN and reminder over the Internet * Blocking of (lost, stolen) cards * Domestic and international fund transfers * Micro-payment handling * Mobile recharging * Commercial payment processing * Bill payment processing * Peer to Peer payments * Withdrawal at banking agent * Deposit at banking agent

Online Banking

Paper bank statements can be troublesome. When the mail gets lost or comes late, when you lose your statement copies or when your belongings are stolen, they can provide uncertainty and frustration. They also only come once a month, leaving your balance inquiries and other account information unanswered in the interim. However, in the age of the Internet, online banking has come to the foreground of bank services.

What Is Online Banking?

Online banking, also called Internet banking, allows customers to conduct financial transactions on a secure Web site that is operated by their retail or virtual bank, credit union or building society. On these sites, customers may check their balances, view statements, verify account information, monitor their spending, make bill payments electronically and much more.

How It Works

Using encrypted Web sites, financial businesses with user accounts allow their customers to create online memberships. On the sites, the businesses upload their financial information, sending reports and statements through a secure network that the customers can access and adjust. Users can, among other things, apply for a loan or credit card, transfer funds between personal accounts or to other bank customers, make investments and pay bills, all online. Because these are all online services, they are available at all hours of the day, unlike bank buildings, which are only open during certain hours and on specific days.

This time flexibility is helpful to customers on many levels. Whereas in-office visits require prior research and document-gathering on the part of the customer, online banking gives them the convenience of doing preliminary research at any time. With the latest market smartphones, customers can even access this information on their phones, giving them portable convenience, as well. With Internet banking, customers can also shop around easily to find the best interest rates and features in their banking institutions.

Financial institutions are inclined to provide online banking for several reasons, not the least of which is Internet popularity. By forwarding customer traffic to the Internet, banks can save money on human stations. In fact, some banks today are online only, and their only person-to-person customer service is provided over computer messaging or the telephone.

Personal safety and security is the biggest concern with online banking. Hackers and scammers are constantly trying to access your financial information. However, because many financial institutions have extraordinarily encrypted sites, it is very difficult for outsiders to get access to your information. Still, keep an eye out for suspicious online communication. Be wary of any e-mail or message -- even ones that say they are from your banking institution -- that asks you to provide any personal information, including account numbers, social security numbers and the like. No bank will ever ask for this information via e-mail, and if you are ever unsure, call your financial institution immediately to verify.

While financial transactions can take anywhere from 24 to 72 hours to appear on your company's site, detecting fraudulent spending will still be easier than with your monthly statements alone. Also, banks will always allow you the option to receive paper statements in addition to your electronic statements. However, if you would like to go paper-free, many banks offer this feature, as well. Online banking is an ever-evolving system, so features and options are always growing and expanding. Call your banking institution if you ever have any questions regarding the system.

So It's Time for Online Banking

It is usually safest to register for online accounts in an office, if possible. This can reduce the risk of leaking your personal information. However, if this is not an option, be sure that the online banking site you are using offers an encrypted site. Double check the names of these security companies or features to ensure they are legitimate operations. When setting up an online banking account, personal safety is always the biggest concern.

If you opt for paperless communications -- only receiving online notifications and statements -- be sure to regularly check your online account. Many online bankers lose track of their finances easily by not monitoring this information. If you're unsure of your ability to stay on top of things, sign up for e-mail reminders or automatic bill pays. These can help keep you on top of your finances and avoid late payments and fees.

Challenges Facing by Banking Industry

INTRODUCTION

The
bank marketing is than an approach to market the services
profitability. It is a device to maintain commercial viability. The
changing perception of bank marketing has made it a social process. The
significant properties of the holistic concept of management and
marketing has made bank marketing a device to establish a balance
between the commercial and social considerations, often considered to
the be opposite of each other. A collaboration of two words banks and
marketing thus focuses our attention on the following:

*
Bank marketing is a managerial approach to survive in highly
competitive market as well as reliable service delivery to target
customers.


* It is a social process to sub serve social interests.

* It is a fair way of making profits

* It is an art to make possible performance-orientation.


* It is a professionally tested skill to excel competition.

USERS OF BANKING SERVICES:

The
emerging trends in the level of expectation affect the formulation of
marketing mix. Innovative efforts become essential the moment it finds
a change in the level of expectations. There are two types of customers
using the services of banks, such as general customers and the
industrial customers.

GENERAL USERS

Persons having an account in the bank and using the banking
facilities at the terms and conditions fixed by a bank are known as
general users of the banking services. Generally, they are the users
having small sized and less frequent transactions or availing very
limited services of banks.

INDUSTRIAL USERS

The
industrialists, entrepreneurs having an account in the bank and using
credit facilities and other services for their numerous operations like
establishments and expansion, mergers, acquisitions etc. of their
businesses are known as industrial users. Generally, they are found a
few but large sized customers.

BANK MARKETING IN THE INDIAN PERSPECTIVE

The
formulation of business policies is substantially influenced by the
emerging trends in the national and international scenario. The GDP,
per capita income, expectation, the rate of literacy, the geographic
and demographic considerations, the rural or urban orientation, the
margins in economic systems, and the spread of technologies are some of
the key factors governing the development plan of an organization,
especially banking organization.

In
ours developing economy, the formulation of a sound marketing mix is
found a difficult task. The nationalization of the Reserve Bank of
India (RBI) is a landmark in the development of Indian Banking system
that have paved numerous paths for qualitative-cum quantities
improvements in true sense. Subsequently, the RBI and the policy makers
of the public sector commercial banks think in favor of conceptualizing
modern marketing which would bring a radical change in the process of
quality up gradation and village to village commercial viability.

BANK MARKETING MIX AND STRATEGIES

The first task before the public sector commercial Banks is to formulate that Bank
marketing mix which suits the national socio-economic requirements. Some have 4 P's and some have 7 P's of marketing mix. The common four Ps of Marketing mix are as follows:-

Product

To
be more specific the peripheral services need frequent innovations,
since this would be helpful in excelling competition. The product
portfolio designing is found significant to maintain the commercial
viability of the public sector banks. The banks professionals need to
assign due weightage to their physical properties. They are supposed to
look smart active and attractive.

Price

Price
is a critical and important factor of bank marketing mix due numerous
players in the industry . Most consumers will only be prepared to
invest their money in search of extraordinary or higher returns. They
are ready to pay additional value if there is a perception of extra
product value. This value may be improved performance, function,
services, reliability, promptness for problem solving and of course,
higher rate of return 

Promotion

Bank
Marketing is actually is the marketing of reliability and faith of the
people .It is the responsibility of the banking industry to take people
in favor through Word of mouth publicity, reliability showing through
long years of establishment and other services.

Place

The
choice of where and when to make a product available will have
significant impact on the customers. Customers often need to avail
banking services fast for this they require the bank braches near to
their official area or the place of easy access.

BANK MARKETING STRATEGIES

The
marketing research considered being a systematic gathering, recording
and analysis of data makes ways for making and innovation the marketing
decisions. The information collected from the external sources by
conducting surveys helps bank professional in different wants.

In
the bank services, the formulation of overall marketing strategies is
considered significant with the view point of tapping the potentials,
expanding the business and increasing the marketing share. The
increasing domination and gaining popularity banks, the popularity
banks, the profitable schemes of the non-banking organization mounting
craze among the customers for private banks have made the task of
influencing the impulse of customers a bit difficult.

The
marketing research simplifies the task of studying the magnitude of
competition by opinion surveys and the feed back customers, the
multi-dimensional changes in the services mix can be made productive if
it is based on marketing research.

CHALLENGES AHEAD:

The
banking industry in India is undergoing a major change due to the
advancement in Indian economy and continuous deregulation. These
multiple changes happening in series has a ripple effect on banking
industry which is trying to be organized completely, regulated sellers
of market to completed deregulated customers market

1. Deregulation:

This
continuous deregulation has given rise to extreme competition with
greater autonomy, operational flexibility, and decontrolled interest
rate and liberalized norms and policies for foreign exchange in banking
market. The deregulation of the industry coupled with decontrol in the
interest rates has led to entry of a number of players in the banking
industry. Thereby reduced corporate credit off which has resulted in
large number of competitors battling for the same pie.

2. Modified New rules:
 

As
a result, the market place has been redefined with new rules of the
game. Banks are transforming to universal banking, adding new channels
with lucrative pricing and freebees to offer. New channels squeezed
spreads, demanding customers better service, marketing skills
heightened competition, defined new rules of the game pressure on
efficiency. Need for new orientation diffused customer loyalty. Bank
has led to a series of innovative product offerings catering to various
customer segments, specifically retail credit.

3. Efficiency: 

Excellent
efficiencies are required at banker's end to establish a balance
between the commercial and social considerations Bank need to access
low cost funds and simultaneously improve the efficiency and efficacy.
Owing to cut-throat competition in the industry, banks are facing
pricing pressure, have to give thrust on retail assets.

4. Diffused customer loyalty:

Attractive
offers by MNC and other nationalized banks, customers have become more
demanding and the loyalties are diffused. Value added offerings bound
customers to change their preferences and perspective. These are
multiple choices; the wallet share is reduced per bank with demand on
flexibility and customization. Given the relatively low switching
costs; customer retention calls for customized service and hassle free,
flawless service delivery.

5. Misaligned mindset:

These
changes are creating challenges, as employees are made to adapt to
changing conditions. The employees are resisting to change and the
seller market mindset is yet to be changed. These problems coupled with
fear of uncertainty and control orientation. Moreover banking industry
is accepting the latest technology but utilization is far below from
satisfactory level.


6. Competency gap:

The
competency gap needs to be addressed simultaneously otherwise there
will be missed opportunities. Placing the right skill at the right
place will determine success. The focus of people will be doing work
but not providing solutions, on escalating problems rather than solving
them and on disposing customers instead of using the opportunity to
cross sell.

STRATEGIC OPTIONS TO COPE WITH THE CHALLENGES:

Dominant
players in the industry have embarked on a series of strategic and
tactical initiatives to sustain leadership. The major initiatives
incorporate:


a) Focus on ensuring reliable service delivery through Investing on and implementing right technology..

b) Leveraging the branch networks and sales structure to mobilize low cost current and savings deposits.


c) Making aggressive forays in the retail advances segments of home and personal loans.

d) Implementing initiatives involving people, process and technology to reduce the fixed costs and the cost per transaction.


e) Focusing on fee based income to compensate foe squeezed spread.


f) Innovating products to capture customer 'mind share' to begin with and later the wallet share.

g) Improving the asset quality as Basel II norms.

CONCLUSION:

The
banking environment of today is rapidly changing and the rules of
yesterday no longer applicable. The corporate and the legal barriers
that separate the various banking, investment and insurance sectors are
less well defined and the cross-over are increasing. As a consequence
the marketing function is also changing to better support the bank in
this dynamic market environment. The key marketing challenge today is
to support and advice on the focus positioning and marketing resources
needed to deliver performance on the banking products and services.
Marketing, as an investment advisor, is about defining 4Ps and
implementing key strategic initiatives to Market segments, increasingly
redefined, relevant micro-segments to survive and flourish in the
highly competitive market

How to Protect Yourself When Banking Online

Provided By: Associated Content, Inc.

Paying bills, shopping and banking online are convenient time and money saving ways to handle business. A few precautions can go a long way in protecting your identity and your finances when banking online.

Set up computer barricades, choose a legitimate bank, keep passwords secret, check statements regularly and beware scam emails. These steps will help ensure happy surfing, shopping and banking.

 

Banking online tip 1: Barricades

Before even going online, install computer security. If your operating system came with a firewall, make sure it's activated. If not, install and activate a firewall. Keep it activated at all times. Install anti-virus and anti-spy software. There are several free and paid versions available. Whatever you choose, use the software regularly and keep it updated. Most software programs allow you to set run times as well as making updating an automatic process.

Banking online tip 2: Legitimate Banks

Most banks now offer banking online. Make sure you're doing business with an FDIC insured bank. Check for the FDIC logo or go to www.fdic.gov and see if your bank is on the list. When using bank services, there should be an extra 's' in the URL (example: https) letting you know the site is secure and encrypted. A locked padlock should be visible in the right hand corner of your screen. Click on the lock to view the type of encryption the site uses. If there is no padlock and no other visible sign of security, do not enter private passwords or other information.

Banking online tip 3: Protect Passwords

When creating personal identification numbers (PINs) and passwords, it's easy to use the same password everywhere. Some people even use the word password as their password. While these practices may be easy, they aren't safe. Nor are passwords containing family names, pet names, birthdays, anniversaries, telephone or address numbers. Such passwords are too easily hacked.

Create passwords from combinations of letters and numbers. Change your passwords regularly. If you are storing passwords, make sure the storage method is encrypted. When choosing security question answers, try to choose questions with answers that aren't readily known by other people.

Keep a password and banking information list with important papers inside a safe or deposit box. If something happens to you, someone may need the information to take care of business for you or to settle things in case of your death.

Banking online step 4: Check Statements Regularly

Keep an eye on bank and credit card statements and other financial mailings. If you find errors or suspect fraud, contact customer service immediately. Keep record of all communication with banks and financial services.

Be wary of unknown companies seeking your private information. When using credit or debit cards online, maintain the same safe practices that apply to banking. Make sure the site is secure before divulging information. Print ourt receipts for all online transactions. Check statements regularly and immediately report errors or possible fraud.

Banking online step 5: Beware Phishing (fishing) Emails

Never click on emails from unknown senders. Scam artists send emails that appear to be legitimate in an effort to steal your money and or identitiy. Banks, Credit Card Companies, Paypal and Ebay are often featured in fake emails.

Legitimate emails from your bank, credit card and other companies will not ask for personal information via email. They will not ask for passwords or account numbers in emails.

Never click on links inside emails from questionable sources. Scam artists imitate legitimate websites and steal your information when you log on to their phony sites.

Never download attachments from unknown sources. You could be opening your computer up to viruses, trojans and worse.

Banking Online Summary

Bill paying, shopping and banking online are convenient and save time and money. Before you log on, make sure you've activated barricades to protect your privacy and prevent fraud. Once online, make sure you're doing business with a legitimate bank. Use creative passwords and protect them. Check financial statements regularly and monitor for any sign of errors or potential fraud. Beware fake emails. Practice smart, safe banking online.

Which banks are best for complaints?

Having your complaint dealt with quickly and fairly is extremely important when choosing where to bank but which banks are best for complaints?

Barclays is the financial institution most likely to reject a consumer's complaint against it, according to data from consumer watchdog, the Financial Ombudsman Service.

The six-monthly complaints figures are released by the ombudsman to inform consumers about the numbers of complaints being logged against some 100,000 financial businesses.

More pertinently for consumers, they also reveal home often the ombudsman has decided that the consumer's complaint is justified.

Since the second half of 2009, the total number of complaints referred to the ombudsman has gone up by 2,076.

The most-complained-about financial businesses can be easily enough identified, each having over 3,000 individual complaints being made against them. Lumped together, the top five account for over half of all complaints logged by the ombudsman.

While these numbers may seem large, it should be remembered that the financial institutions involved are also large.

The Bankers Association has been at pains to point out that the banks with more customers will statistically also have more complaints. It also suggests that just because a customer complains, the bank shouldn't automatically be seen to be at fault.

While complaint numbers aren't in themselves indicative, what is particularly telling is the percentage of complaints that have been decided in the consumer's favour by the ombudsman. In this respect, Barclays fares the worst.

While Lloyds TSB bank received the most overall complaints with Barclays coming relatively far behind with 7,991, the ombudsman decided that the consumer's complaint was justified in 61 percent of Barclay's cases compared to 45 percent of Lloyds. Not that either of them is particularly good considering that the industry average is a 44 percent uphold rate.

The Bank of Scotland was complained about 6,211 times, of which 23 percent were upheld. Santander received 4,881 complaints, 19 percent of which were upheld. HSBC received 3,286 complaints, 34 percent of which were upheld.

The chief ombudsman has said that financial institutions need to make more effort in investigating and ensuring that consumer complaints are properly resolved.

For the purpose of its report, the ombudsman used five categories for consumers' complaints. These are: life and pensions and decumulation; banking and credit, general insurance; mortgages and home finance; and investment.

The figures relating to credit card complaints are in the banking and credit category so these are of most interest to those looking to compare credit cards.

More than half of complaints made about Barclays, Santander, the Bank of Scotland and HSBC were directed at their credit and banking services. Around two-thirds of complaints issued against Lloyds referred to its general insurance services, with about a third concerning its credit and banking services.

While credit card holders may well be wondering what the specific numbers of complaints made by cardholders amounts to, such specifics haven't yet been made available by the ombudsman. This has led to grumbling among some consumer rights organisations.

A spokesman for Consumer Focus has stated that there must be more focus on what individual complaints refer to.

In particular, he asked for specifics regarding which products are consistently being complained about so that consumers can make more informed decisions when searching for a specific product. For example, 0% balance transfer credit cards.