Banking

Banking — No Comments
24
Jan 12

Bridge Loan Meaning

Bridge loan as the name suggests is a type of loan which bridges the gap for a borrower and gives him or her more time to arrange for the cash in order to repay the loan or meet his or her current obligations. It can be better understood with the help of an example suppose you are in a college and its 25th of a month, now you need urgently $200 but your pocket money will come only on 1st of next month, than in that case you would borrow $200 from your friend and repay it next month when you receive your pocket money.

Big companies and individuals in real life do the same as in the above example, the only difference being they take it from the banks or financial institutions which charges interest on such loans and the amount is quite large and not as small as in the above example.

 

Banking — No Comments
4
Dec 11

How to Deposit a Cheque

Depositing a cheque can be a problem if one does not have any idea how to deposit a cheque in the bank. It is simple to deposit a cheque in the bank, one has to fill up pay in slip in which details of cheque such as name of the account holder, name of the branch, cheque number, date of the cheque, amount etc are to be filled up. Once you have filled all the details than you can deposit a cheque in the bank.  There are 4 ways of depositing a cheque -

  1. One can personally deposit the cheque on banks counter and obtain receipt on counterfoil of pay in slip.
  2. The cheque can be dropped in the drop box which is available at all branches at the entrance of branch of bank.
  3. Cheque can also be deposited in ATM of the concerned bank where also drop box facility is available.
  4. One can send the cheque through post to concerned bank also.
Banking — No Comments
19
Nov 11

Advantages of Online Banking

Online banking is the result of tremendous development which has taken place in the field of technology in the past few decades. Now almost every bank provides the facility of online banking to its customers. Given below are some of the advantages of online banking –

  1. The first and foremost advantage of it is the ease and convince which it gives to the customers, one can transect from anywhere in the world without visiting the bank premises.
  2. In this age where everyone is in a hurry it has become a necessity rather than a luxury because no one wants to waste his or her time standing in a queue to pay bills or deposit cash into the bank.
  3. It is more cost efficient for both bank as well as customers, because banks have to deploy less staff and customers also get this facility without any extra charge.
  4. One can check his or her account statement anytime which helps the customers in knowing the exact amount of money which he or she has in account and therefore can plan their expenses accordingly.
  5. One can keep watch himself or herself on the account and therefore one can keep a close watch over the transactions which in turn can help in averting any fraud which is not possible in case of normal banking where if you have to see transactions you have to go to bank which can be a cumbersome task.
Banking — No Comments
7
Nov 11

Functions of a Bank

Banks are the key contributors towards the well being of the economic system as a whole, without banks there cannot be any economic activity possible as banks are one of major pillars of smooth economic activity, given below are some of the functions of a bank –

  1. Banks makes possible transfer of consumption to future by accepting deposits from the public, imagine if there was no banking system then you have to either store your money in your house or spend on goods and services immediately after receiving the money.
  2. It helps in creating entrepreneurs because talented individuals do not always have the money with them to execute their plans and for them banks by providing loans can to them helps them in carrying out their dream.
  3. It enables individuals and companies to transfer money from one place to another without any hassles and within short period of time, a person can transfer money from one place to anywhere in world within 1 or 2 days.
  4. It also provides various facilities like merchant banking, ATM, personalized banking and so on to the customers.
  5. It also helps in maintaining the flow of funds from household in the form saving to companies in the form of loans and thus stimulating the overall economic activity of a country.
  6. It also helps people in paying money later for current consumption by providing credit cards and letter of credit facilities to its customers.
    Banking — No Comments
    14
    Mar 11

    Uses of Credit Rating

    Credit rating refers to assessment of the financial position of the company based on various parameters, in simple words credit rating refers to the ability of a company or an individual to repay its debt on time. Given below are some of the uses of credit rating –

    1. Credit rating is used by the investors for making investment decision about the debt or equity of company, based on the credit rating which company has received from credit rating agency.
    2. Credit rating is also used by a company; because a company which has received good credit rating can raise funds easily from either capital markets in the form of issue of equity shares or from debt markets in the form of bonds.
    3. Credit rating has regulatory importance also because if company is going for initial public offering than it is compulsory for it to get credit rating before issuing shares to public, so that investors know about the company before applying for the initial public offering.
    4. Credit rating is also used by companies when they take loan from the banks or other financial institutions.
    5. Credit rating is also used to judge about the overall operational efficiency and efficiency of the top management in running the business of a company.
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