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Services provided by bank other than loans and deposits


Banks are synonymous for loans and deposits but banks provide many other services along with these.

Banks while serving with financial transactions and loans, also serve some others too. Let us go over them here…

Protecting your belongings:
You can put your valuable things like gold and diamond ornaments, valuable documents, etc in bank lockers and can be used by paying some amount.

RBI suggested the banks to maintain two documents for the customer for keeping and taking of things in the locker. These documents are very important for the customer as well as the bank.

Note exchange:
Per RBI orders, damaged or soiled notes can be exchanged in any bank even if you are not a customer.

Foreign exchange services and payments:
Selected banks display foreign exchange rates and fees where foreign currency can be exchanged for Indian. Based on foreign exchange act and regulations, deposits can be made into foreign accounts.

There is NEFT (national electronic fund transfer) for people in other countries to send money to our accounts, which takes 24 to 96 to complete.

There is facility to send money by debit/credit cards and cheques.

It is better to know the currencies permitted beforehand.

Banks charge some service charge for accepting money from other countries.

Insurance brokerage services:
RBI permitted banks to provide insurance policies of other companies with some fees, which facilitates banks to sell these policies like agents. Banks serve as brokers by giving services as well as advices.

Investment related services:
Banks facilitate customers to do shares and debenture transactions. All major banks have special branches for this purpose in all major cities. Every service is charged to an extent.

Line of credit:
Major banks give companies limited liberty to use the working capital investments in different businesses. This may help in enhancing the productivity of small and middle cap industries.

Retirement planning:
Banks provide retirement and pension plans that will aid during old age. Banks provide special retirement plans for salaried as well as self employed and are provided at nominal fees.

Investments in mutual funds
Banks appoint mutual fund managers to direct the deposits made by customers towards profitable ventures. They observe the fluctuations in the market and profit and loss of the company. They give advise keeping in mind the capacity of the company and other factors. Banks have to take permission from SEBI to do such transactions.

Online trading:
Banks are making trading for NRIs easier by opening DMAT and trading accounts in India. These aid in NRIs trading in BSE and NSE. Banks that have no direct stock broking permits have agreements with broking companies. To do equity trading, the trading account has to be linked with savings account.

Investments in debt market funds:
Banks facilitate investment in certificate of deposits, government bonds, corporate deposits, commercial documents, etc.