This page contains the NCERT Business Studies class 11 chapter 4 Business Services from Part 1 Foundations of Business. You can find the solutions for the chapter 4 of NCERT class 11 Business Studies, for the Short Answer Questions and Projects/Assignments Questions in this page. So is the case if you are looking for NCERT class 11 Business Studies related topic BUSINESS SERVICES question and answers.
Short Answer Questions
1. Define services and goods.
Services: Services are those separately identifiable, essentially intangible activities that provide satisfaction of wants, and are not necessarily linked to the sale of a product or another service. Their purchase does not result in the ownership of anything physical.
Goods:A good is a physical product capable of being delivered to a purchaser and involves the transfer of ownership from seller to customer. Goods are also generally used to refer to commodities or items of all types, except services, involved in trade or commerce.
2. What is e-banking. What are the advantages of e-banking?
Definition of e-Banking:e-Banking is a part of virtual banking and another delivery channel for customers. In simple terms, Internet banking means any user with a PC and a browser can get connected to the bank’s website to perform any of the virtual banking functions and avail any of the bank’s services. There is no human operator to respond to the needs of the customer. e-Banking is a service provided by many banks, that allows a customer to conduct banking transactions, such as managing savings, checking accounts, applying for loans or paying bills over the internet using a personal computer, mobile telephone or handheld computer (personal digital assistant).
Advantages of e-Banking for Customers:
(i)
E-banking facilitates digital payments and promotes transparency in financial statements.
(ii)
Provides 24 hours, 365 days a year services.
(iii)
Customers can make some of the permitted transactions from office or house or while travelling via mobile telephone.
(iv)
It inculcates a sense of financial discipline by recording each and every transaction.
(v)
Greater customer satisfaction by offering unlimited access to the bank and less risk and greater security to the customer as they can avoid travelling with cash.
Advantages of e-Banking for Banks:
(i)
e-Banking provides competitive advantage.
(ii)
Provides unlimited network to the bank and is not limited to the number of branches.
(iii)
Load on branches can be considerably reduced by establishing centralised data base and by taking over some of the accounting functions.
3. Write a note on various telecom services available for enhancing business.
Telecom Services for Enhancing Business:
(i)
Cellular mobile services: Mobile services, including voice, non-voice messages, and data services. Offers interconnectivity with other telecom providers.
(ii)
Fixed line services: Provides voice and non-voice messages and data services using fiber optic cables. Enables long-distance traffic connections.
(iii)
Cable services: Primarily for one-way entertainment but has potential for two-way communication in the future.
(iv)
VSAT services: Satellite-based communication ideal for urban and remote areas. Useful for applications like tele-medicine and tele-education.
(v)
DTH services: Satellite-based media service. Provides multiple channels directly through satellite without depending on cable networks.
These services bolster business activities by ensuring robust communication and media options.
4. Explain briefly the principles of insurance with suitable examples.
Principles of Insurance:
1.
Utmost Good Faith: Both parties must be completely honest. For example, disclosing health conditions when buying health insurance.
2.
Insurable Interest: The insured must have a financial stake, like a person insuring their own house.
3.
Indemnity: Compensation is for restoring the insured’s position, not for profit. A damaged shop gets repairs, not more than the loss.
4.
Proximate Cause: The policy covers specific risks. A house damaged by a dam break isn’t covered if only “rain damage” is specified.
5.
Subrogation: After paying compensation, the insurer can claim the damaged property, like a totaled car.
6.
Contribution: If multiple insurances cover a loss, they share the compensation, based on their coverage amounts.
7.
Mitigation: The insured must try to reduce damage. For example, attempting to put out a small fire in a house.
In essence, these principles prevent exploitation and ensure both insurer and insured uphold their responsibilities.
5. Explain warehousing and its functions.
Warehousing: Warehousing refers to the systematic process of storing goods in a manner that maintains their quality and value. Initially seen as a static storage unit, modern warehouses have evolved into logistical service providers, ensuring goods are available in the right quantity, place, and time. They can be automated with advanced systems for efficient management.
Types of Warehouses:
1.
Private warehouses: Owned or leased by companies for their own goods.
2.
Public warehouses: Open for storage by traders, manufacturers, or the public for a fee.
3.
Bonded warehouses: Licensed by the government for storing imported goods before tax and customs duty payment.
4.
Government warehouses: Owned and operated by the government or its public sector organizations.
5.
Cooperative warehouses: Managed by cooperative societies for their members.
Functions of Warehousing:
1.
Consolidation: Combining materials from various plants for dispatch as a single shipment.
2.
Break the bulk: Splitting bulk quantities into smaller shipments based on client requirements.
3.
Stock piling: Seasonal storage of goods or raw materials not immediately required.
4.
Value added services: Offering services like repackaging, labeling, and in-transit mixing.
5.
Price stabilization: Balancing supply with demand to stabilize prices.
6.
Financing: Advancing money against the security of goods and offering goods on credit to customers.
Warehousing thus plays a pivotal role in ensuring the smooth functioning of businesses by providing storage solutions and additional services.
Long Answer Questions
1. What are services? Explain their distinct characteristics.
Services:Services are intangible economic activities that cater to specific needs and do not result in the ownership of a physical product. They involve an interaction between the service provider and the consumer and can vary from advice, treatment, entertainment, and more. Unlike tangible goods, services are experienced and cannot be owned. For example, while you can buy medicine (a good), you cannot purchase the doctor’s treatment (a service); you can only seek it.
Distinct Characteristics of Services:
1.
Intangibility: Services cannot be touched or seen before they are experienced. They are primarily experiential, and their quality cannot be determined prior to consumption. For instance, a patient can only experience a doctor’s treatment but cannot touch or see it beforehand.
2.
Inconsistency: Services are not standardized and must be uniquely performed every time. Different customers have varying demands, and services must be tailored to meet those specific needs. For example, mobile services need to be personalized according to the user’s preferences.
3.
Inseparability: The production and consumption of services occur simultaneously. Unlike physical goods, which can be produced now and sold later, services need to be consumed as they are rendered. An example is dining in a restaurant, where the service of preparing and serving food happens in real-time.
4.
Inventory (Less): Services cannot be stored for future use due to their intangible nature. The service must be rendered when the customer demands, making them perishable. A railway journey, for instance, can only be experienced when provided by the railways, even though the ticket (a tangible aspect) can be stored.
5.
Involvement: The customer often participates in the service delivery process, providing an opportunity to modify the service based on specific requirements. For instance, customers at a fast-food joint might choose their ingredients, reflecting the customization of service.
In summary, while goods are tangible physical products, services are intangible activities that are individually experienced and cannot be owned. Their unique characteristics of intangibility, inconsistency, inseparability, inventory-less nature, and customer involvement set them apart from tangible goods.
2. Explain the functions of commercial banks with an example of each.
Functions of Commercial Banks:
1.
Acceptance of deposits: Commercial banks accept money from the public in various types of accounts, including current, savings, and fixed deposits. This money forms the basis for their lending operations.
Example: An individual opens a savings account in a bank and deposits a certain amount. This deposited amount earns interest and can be withdrawn based on the account’s terms, like after a specified period in the case of fixed deposits or anytime for current accounts.
2.
Lending of funds: Banks provide loans and advances from the money they acquire through deposits. This lending can be in various forms, including overdrafts, cash credits, term loans, and more.
Example: A business firm approaches a bank for a loan to expand its operations. The bank, after evaluating the firm’s creditworthiness, approves a term loan to help the firm in its expansion.
3.
Cheque facility: Banks offer customers the privilege of using cheques to withdraw money or make payments. This system acts as a convenient and inexpensive medium of monetary transactions.
Example: A customer, instead of carrying cash, writes a cheque to pay for a purchased item at a store.
4.
Remittance of funds: Banks assist in transferring funds from one location to another, facilitated by the vast interconnected network of their branches.
Example: An individual in Delhi can send money to another individual in Mumbai by issuing a bank draft. The recipient can then cash this draft at their local branch in Mumbai.
5.
Allied services: Banks also provide various additional services like bill payments, locker facilities, underwriting, and more.
Example: A customer can use their bank’s online portal to pay monthly utility bills like electricity and water. Another example would be a customer renting a safe deposit locker in the bank to store valuable items securely.
In essence, commercial banks play a pivotal role in facilitating monetary transactions, supporting businesses with financial needs, and offering various services for customer convenience. Their functions bridge the gap between savers and borrowers, thereby fostering economic growth.
3. Write a detailed note on various facilities offered by Indian Postal Department.
Facilities Offered by the Indian Postal Department:
1. Financial facilities:
●
Post Office’s Savings Schemes: These schemes help citizens to save money and earn interest on them. Some of the popular schemes are Public Provident Fund (PPF), Kisan Vikas Patra, and National Saving Certificates.
●
Retail Banking Functions: The postal department also performs regular banking tasks like monthly income schemes, recurring deposits, savings account, time deposits, and the provision of the money order facility for transferring money from one place to another.
2. Mail facilities:
●
Parcel Facilities: This allows users to send packages or articles from one place to another.
●
Registration Facility: For those looking for security during transit, the registration facility ensures that their articles are sent securely.
●
Insurance Facility: This facility provides insurance cover to protect against all risks during the transmission by post.
3. Allied facilities:
●
Greeting Post: A selection of greeting cards available for various occasions.
●
Media Post: Offers Indian businesses an innovative way to advertise their brands using postal tools like postcards, envelopes, aerograms, telegrams, and letterboxes.
●
Direct Post: Useful for direct advertising, which can be both addressed and unaddressed, to reach a target audience.
●
International Money Transfer: In collaboration with Western Union Financial Services, USA, the postal department facilitates the remittance of money from 185 countries to India.
●
Passport Facilities: Through a partnership with the Ministry of External Affairs, the postal department assists in the passport application process.
●
Speed Post: This expedited mail service covers over 1000 destinations within India and is connected with 97 major countries worldwide.
●
e-bill Post: A new service to collect bill payments over the counter specifically for companies like BSNL and Bharti Airtel.
In conclusion, the Indian Postal Department offers a wide range of services, catering to the diverse needs of the Indian populace. From basic mail services to advanced financial solutions, their facilities play a crucial role in connecting and serving millions across the country.
4. Describe various types of insurance and examine the nature of risks protected by each type of insurance.
The following are the various types of Insurance and the risks protected by each of them.
1. Life Insurance:
Description:
A contract between the insured and the insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person or after a set period. It primarily provides a safety net for survivors after the policyholder’s death and can also serve as a savings or investment tool.
Risks Protected:
●
Premature Death: Ensures financial support for dependents and beneficiaries in the event of the insured’s unexpected death.
●
Living till Retirement: Provides financial security when an individual might outlive their earning potential and needs financial support in old age.
●
Disability and Disease: Some policies offer benefits if the insured becomes disabled or contracts a critical illness, affecting their earning capability.
2. Fire Insurance:
Description:
A contract that compensates the policyholder for any loss or damage to property due to fire. It can cover the cost to repair or replace damaged property, as well as other associated costs.
Risks Protected:
●
Property Damage: Offers financial protection against damage or loss of property due to accidental fires, including buildings, machinery, and other assets.
●
Ancillary Damages: Can also cover costs related to fire damage, like water damage from firefighting efforts or costs associated with alternative accommodations.
●
Liability: Some policies might offer protection against legal liabilities arising from fire damage inflicted on neighboring properties.
3. Marine Insurance:
Description:
A cover against losses and damages caused to ships, cargo, terminals, and any transport by which the property is transferred or acquired between different points of origin and their final destination.
Risks Protected:
●
Ship or Hull Damage: Covers damages to the ship caused by various marine perils, such as collisions, fires, or attacks by pirates.
●
Cargo Damage: Provides financial coverage against damages, loss, or theft of cargo during its transportation by sea.
●
Loss of Freight: Offers compensation for the loss of freight charges if cargo doesn’t reach its destination due to specific perils.
Each type of insurance serves to mitigate specific financial risks associated with unpredictable events. By taking these insurance covers, individuals and businesses can find peace of mind and financial stability during unforeseen adversities.
5. Explain in detail the warehousing services.
Warehousing, traditionally seen as a mere storage facility, has significantly evolved over time. Instead of just housing goods, modern warehouses have become pivotal logistical service providers, ensuring goods are stored and dispatched efficiently. The advent of automation, including computer-operated cranes, automatic conveyors, and advanced management software, has transformed warehousing into a highly efficient system.
Types of Warehouses:
1.
Private Warehouses: These are owned or leased by companies for their own goods. They offer control, flexibility, and benefits like improved dealer relations.
2.
Public Warehouses: Available for use by various traders or manufacturers, these warehouses are regulated by the government. They not only store but also offer transportation facilities.
3.
Bonded Warehouses: Operated under government license, these warehouses store imported goods before the customs duty is paid. They offer storage and even enable re-export without customs duties.
4.
Government Warehouses: These are owned and operated by the government and are typically managed by public sector organizations.
5.
Cooperative Warehouses: Run by cooperative societies, they cater mainly to their members.
Key Functions of Warehousing:
1.
Consolidation: Warehouses gather products from different sources and dispatch them as one shipment, promoting efficiency.
2.
Break the Bulk: They also divide bulk products into smaller, manageable quantities for distribution.
3.
Stock Piling: Warehouses store seasonal goods, releasing them gradually to match the market demand.
4.
Value Added Services: Modern warehouses offer services like in-transit mixing, repackaging, and relabeling.
5.
Price Stabilisation: By balancing supply and demand, warehouses play a role in stabilizing market prices.
6.
Financing: Warehouses can also offer financial services, providing funds against stored goods as collateral and supplying goods on credit.
In conclusion, warehousing has transcended its conventional role. It not only stores but also plays a crucial part in the logistical, financial, and supply chain systems, ensuring goods are managed, stored, and delivered in the most efficient and effective manner.
Projects/Assignments
1. Identify a list of various services you use on a regular basis and identify their distinct characteristics.
1. Banking Services:
Characteristics:
●
Safekeeping of funds.
●
Provision of credit facilities.
●
Transaction processing (both domestic and international).
●
Online banking and mobile banking facilities.
●
Investment advisories and wealth management.
2. Telecommunication Services
Characteristics:
●
Enables communication through calls, messages, and the internet.
●
Provides both wired and wireless services.
●
Offers various plans catering to different user needs.
●
International roaming and data services.
3. Insurance Services
Characteristics:
●
Provides financial protection against unexpected events.
●
Premiums based on risk assessment.
●
Coverage for life, health, property, travel, and more.
●
Claims processing in case of insured events.
4. Health Services (Hospitals, Clinics)
Characteristics:
●
Offers medical consultation, treatment, and surgery.
●
Emergency and trauma services.
●
Health check-ups and diagnostic facilities.
●
Wellness and preventive health care.
5. E-commerce & Retail Services
Characteristics:
●
Online shopping platforms and physical stores.
●
Wide range of products and brands.
●
Home delivery and return/exchange facilities.
●
Digital payments and cash-on-delivery options.
6. Transportation and Logistic Services
Characteristics:
●
Movement of goods and passengers.
●
Different modes available: road, rail, air, and sea.
●
Warehousing and supply chain management.
●
Tracking facilities for shipments.
7. Educational Services (Schools, Coaching Centers)
Characteristics:
●
Imparting knowledge and skills.
●
Curriculum-based teaching and extracurricular activities.
●
Certification and degree offerings.
●
Online courses and e-learning platforms.
8. Entertainment Services (Cinemas, Streaming Platforms)
Characteristics:
●
Provides movies, shows, and live performances.
●
Subscription-based or pay-per-view models.
●
Multi-genre content for diverse audiences.
●
Interactive features like reviews and ratings.
9. Real Estate and Housing Services
Characteristics:
●
Deals with buying, selling, and renting of properties.
●
Property management and maintenance.
●
Real estate consultancy and advisory.
●
Legal paperwork and title verification.
10. Utility Services (Electricity, Water, Gas)
Characteristics:
●
Essential services for daily living.
●
Metered usage and monthly billing.
●
Maintenance and emergency repair services.
●
Renewable energy options and sustainability initiatives.
When we think about our daily lives, we often overlook how heavily we rely on these business services. Each of these services has its unique features, tailored to cater to specific needs and requirements of consumers. Understanding their distinct characteristics helps in making informed decisions while availing these services.
2. Do a project on banking services. Approach a nearby bank and collect information about various services offered by them and also collect leaflets about salient features of different schemes. Compile and suggest what extra services you may like to propose.
Project on Banking Services
Objective: To understand and analyze the various services provided by a bank and suggest possible improvements or additional services based on the current offerings.
Methodology:
1.
Visit a nearby bank.
2.
Engage in conversations with bank officials to gather information.
3.
Collect leaflets, brochures, and other promotional materials about their services.
4.
Analyze the gathered data.
Bank Visited: XYZ Bank (name is hypothetical; replace with the actual name of the bank visited)
Banking Services Offered by XYZ Bank:
1.
Savings Account:
●
Features: No minimum balance, free monthly e-statements, mobile banking.
●
Interest: 4% per annum.
2.
Current Account:
●
Features: Overdraft facility, multi-city cheque book, business debit card.
●
Designed for business entities.
3.
Fixed Deposits:
●
Features: Varying tenures from 7 days to 10 years, loan against FD.
●
Interest: Up to 6.5% per annum.
4.
Loans:
●
Home Loans, Personal Loans, Car Loans, and Education Loans.
●
Features: Competitive interest rates, flexible repayment options.
5.
Credit Cards:
●
Features: Reward points, cashback offers, EMI facilities.
6.
Online & Mobile Banking:
●
Features: Fund transfers, bill payments, loan applications, e-statements.
7.
Demat & Trading Account:
●
Features: Online trading platform, investment advisory.
8.
Insurance Services:
●
Life Insurance, Health Insurance, and Vehicle Insurance.
9.
Mutual Fund Investments:
●
Various schemes based on risk appetite: Equity, Debt, and Hybrid funds.
10.
ATM and Debit Card Services:
●
Features: Wide network of ATMs, international debit cards, SMS alerts.
Leaflets Collected:
1.
XYZ Savings Account.
2.
Home Loans at attractive rates.
3.
Mutual Fund schemes.
4.
Premium Credit Card benefits.
Suggested Extra Services:
1.
Financial Literacy Workshops: Organize monthly or quarterly workshops for customers to enhance their financial knowledge.
2.
Dedicated SME Services: Specialized services for Small and Medium Enterprises (SMEs) including business advisory and loans.
3.
Green Initiatives: Introduce paperless banking, eco-friendly cards, and promote digital transactions.
4.
Customized Banking Solutions: Personalized banking solutions based on customer profiling. For instance, specialized accounts for senior citizens or students.
5.
Chatbots and AI-Based Assistance: 24/7 virtual assistance for online banking queries, improving customer experience.
6.
Health and Wellness Benefits: Collaborate with healthcare entities to offer discounts to bank customers for health check-ups, wellness programs, etc.
7.
Personal Financial Management Tool: A digital platform where customers can track their expenses, investments, and get suggestions for financial planning.
Conclusion:
Banking services have evolved over the years to cater to the diverse needs of the customers. While XYZ Bank offers a broad spectrum of services, there’s always room for enhancement and innovation. By understanding current customer preferences and predicting future trends, banks can stay ahead in the competitive landscape and offer unparalleled service excellence.
3. Visit a nearby bank branch in your locality and collect information about various types of account available for customers to open as per their requirement.
In the second part of the activity match the information given in column A with the information given in Column B.
S.No.
Column A
Column B
1.
Multiple Option Deposit
It is a temporary pass through account held by a third party during the process of a transaction between two parties unless the transaction is completed.
2.
Savings Account
A kind of deposit scheme introduced by different banks, where the excess amount in the savings bank account is transferred to fixed deposit account and the account holder earns more rate of interest. If the bank receives a cheque for this account and the balance is not sufficient, the amount will be transferred from fixed deposit account to savings bank account to clear the cheque. In short, it gives the account holder the interest of a term deposit with the flexibility of partial withdrawal, whereas, the remaining cash will get better interest.
3.
Current Account
It is also called cumulative deposit scheme. Any resident, individual, association, club, institution/ agency is eligible to open this account in single/joint names. The account can be opened for any period ranging from 6 months to 120 months, in multiple of 1 month for monthly installment. The amount selected for installment at the start of the scheme is payable every month and the number of installments once fixed, cannot be changed. The rate of interest is compounded quarterly and the final amount is paid on maturity.
4.
Fixed Deposit Account
Any resident, individual, association, club, etc., is eligible for this account. It is a kind of modest credit option available to the depositor. Two free cheque books will be issued each year. Internet banking facility will be provided without any charge. Balance enquiry, NEFT, bill payment, mobile recharge, etc., are provided through mobile phones. Students can open this account with zero balance by providing the required documents.
5.
Demat Account
This account can be opened by any resident, individual, association, limited company, religious institution, educational institution, charitable institution, club, etc. Payments can be done unlimited number of times. Funds can be remitted from any part of the country to the corresponding account. Overdraft facility and Internet banking facility are available.
6.
Escrow Account
It is classified as short deposit receipt and fixed deposit receipt
a. Short Deposit Receipt
(i)
Banks accept deposits from customers varying from 7 days to a maximum of 10 years.
(ii)
The period for ‘short deposits’ can vary from 7 days to 179 days.
(iii)
The minimum amount that can be deposited under this scheme is ₹ 5 lakh for a period of 7-14 days.
b. Fixed Deposit Receipt
(i)
Any resident, individual, association, minor, society, club, etc., is eligible for this account.
(ii)
The minimum FDR in metro and Urban branches is ₹ 10,000 and in rural and semiurban and for senior citizens is ₹ 5000.
(iii)
Interest rate differs from bank to bank depending upon the tenure of the deposits and as bank changes the rate.
(iv)
Additional interest of 0.50% is offered to senior citizens on deposits placed for a year and above.
7.
Recurring Deposit Account
(i)
This account offers stress-free transactions on the shares.
(ii)
An individual, Non-Resident Indian, foreign institutional investor, foreign national, corporate, trusts, clearing houses, financial institution, clearing member, mutual funds, banks and other depository account.
(iii)
For opening this account, an applicant requires to fill a form, submit his/her photo along with a photocopy of Voter ID/Passport /Aadhar Card/ Driving Licence and a Demat account number will be provided to the applicant immediately after the completion of processing of the application.
My Visit to [Bank Name]: Understanding Different Account Types
Introduction:
Last week, I visited the [Bank Name] located near my residence to understand the variety of accounts and services they offer. I was welcomed by a friendly bank executive who patiently explained all the details.
Types of Accounts I Explored:
1.
Savings Account:
●
Purpose: Mainly for individuals to save money.
●
Features: Requires a minimum balance, offers an ATM card, and earns a modest interest.
2.
Current Account:
●
Purpose: Designed for businesses or traders who have a high frequency of transactions.
●
Features: No interest, provides a checkbook, and requires a higher minimum balance than a savings account.
3.
Fixed Deposit Account:
●
Purpose: For those who want to deposit a lump sum for a specific duration to earn a higher interest.
●
Features: Variety of term durations available, earns higher interest compared to a savings account.
4.
Recurring Deposit Account:
●
Purpose: To save a specific amount regularly (usually monthly) and earn interest.
●
Features: Fixed monthly deposits, interest rates similar to Fixed Deposits, and various term lengths available.
5.
Demat Account:
●
Purpose: To hold shares and securities in an electronic format.
●
Features: Requires linkage to a savings or current account, offers electronic storage of shares, bonds, or mutual funds.
Other Observations:
●
Brochures and Leaflets: The bank provided detailed brochures for each account type, which I collected. These brochures had additional details about the terms and conditions, benefits, and any associated fees.
●
Special Accounts: The bank also had special account types for students and senior citizens. The student account, in particular, caught my eye as it required no minimum balance and offered additional discounts for online transactions.
●
Digital Services: Almost all account types came with online banking options, mobile banking apps, and digital passbook features, highlighting the bank’s focus on digital transformation.
Conclusion:
My visit to [Bank Name] was enlightening. I realized how banks offer a variety of account types tailored to cater to the unique needs of different customer segments. From the average individual looking to save, to businesses, to investors, there’s an account type for everyone. In the future, when I consider opening an account or exploring financial investments, I’ll be better informed to make a choice that suits my needs.
Note: The information in brackets [ ] is indicative and would need to be replaced with actual names/details as appropriate.
Part 2 of this activity:
The following is the table with matching of the Column A and Column B
S.No.
Column A
Column B
1.
Multiple Option Deposit
A kind of deposit scheme introduced by different banks, where the excess amount in the savings bank account is transferred to fixed deposit account and the account holder earns more rate of interest. If the bank receives a cheque for this account and the balance is not sufficient, the amount will be transferred from fixed deposit account to savings bank account to clear the cheque. In short, it gives the account holder the interest of a term deposit with the flexibility of partial withdrawal, whereas, the remaining cash will get better interest.
2.
Savings Account
Any resident, individual, association, club, etc., is eligible for this account. It is a kind of modest credit option available to the depositor. Two free cheque books will be issued each year. Internet banking facility will be provided without any charge. Balance enquiry, NEFT, bill payment, mobile recharge, etc., are provided through mobile phones. Students can open this account with zero balance by providing the required documents.
3.
Current Account
This account can be opened by any resident, individual, association, limited company, religious institution, educational institution, charitable institution, club, etc. Payments can be done unlimited number of times. Funds can be remitted from any part of the country to the corresponding account. Overdraft facility and Internet banking facility are available.
4.
Fixed Deposit Account
It is classified as short deposit receipt and fixed deposit receipt
a. Short Deposit Receipt
(i)
Banks accept deposits from customers varying from 7 days to a maximum of 10 years.
(ii)
The period for ‘short deposits’ can vary from 7 days to 179 days.
(iii)
The minimum amount that can be deposited under this scheme is ₹ 5 lakh for a period of 7-14 days.
b. Fixed Deposit Receipt
(i)
Any resident, individual, association, minor, society, club, etc., is eligible for this account.
(ii)
The minimum FDR in metro and Urban branches is ₹ 10,000 and in rural and semiurban and for senior citizens is ₹ 5000.
(iii)
Interest rate differs from bank to bank depending upon the tenure of the deposits and as bank changes the rate.
(iv)
Additional interest of 0.50% is offered to senior citizens on deposits placed for a year and above.
5.
Demat Account
(i)
This account offers stress-free transactions on the shares.
(ii)
An individual, Non-Resident Indian, foreign institutional investor, foreign national, corporate, trusts, clearing houses, financial institution, clearing member, mutual funds, banks and other depository account.
(iii)
For opening this account, an applicant requires to fill a form, submit his/her photo along with a photocopy of Voter ID/Passport /Aadhar Card/ Driving Licence and a Demat account number will be provided to the applicant immediately after the completion of processing of the application.
6.
Escrow Account
It is a temporary pass through account held by a third party during the process of a transaction between two parties unless the transaction is completed.
7.
Recurring Deposit Account
It is also called cumulative deposit scheme. Any resident, individual, association, club, institution/ agency is eligible to open this account in single/joint names. The account can be opened for any period ranging from 6 months to 120 months, in multiple of 1 month for monthly installment. The amount selected for installment at the start of the scheme is payable every month and the number of installments once fixed, cannot be changed. The rate of interest is compounded quarterly and the final amount is paid on maturity.