Banking Products And Services Pdf
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- Banking Product Terms
- 18 Types of Bank Services
- Pricing of Banking Products and Services : A Case Study of Commercial Banks in Zimbabwe
- Banking Product Terms
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Banking Product Terms
Retail banks have long competed on distribution, realizing economies of scale through network effects and investments in brand and infrastructure. But even those scale economies had limits above a certain size.
As a result, in most retail-banking markets, a few large institutions, operating at similar efficiency ratios, dominate market share. Changes to the retail-banking business model have mostly come in response to regulatory shifts, as opposed to a purposeful reimagining of what the winning bank of the future will look like. Retail banks have also not kept pace with the improvements in customer experience seen in other consumer industries. Few banks stand out for innovation in customer interaction models or branch formats.
Marketing investments have traditionally focused on brand building and increasing loyalty: a reputable brand stood for trust and security and became a moat, providing protection against new entrants to the sector. Today, the moats that banks have built are more likely to restrict their own progress than protect them from attackers. Four shifts are reshaping the global retail-banking landscape to the point where banks need to fundamentally rethink what it takes to compete and win. This should be an urgent priority for banks.
The pace of change will likely accelerate, with a select set of large-scale winners emerging in the next three to five years that will gain share in their core markets and begin to compete across borders, leaving many subscale institutions scrambling for relevance. Over the next three to five years, we expect a few players to emerge from the competitive scrum to gain dominant share in their core markets and possibly beyond.
These firms will have taken bold and decisive actions to capitalize on the following shifts that are reshaping the industry. In some cases, these winners will be incumbents that build on an already significant share; in others, they will be institutions newer to the banking industry, which use their agility, strategic aggressiveness, and sharp execution to attract customers. Over the past decade, this relationship between deposit growth and branch density has weakened.
Deposits at the 25 largest US retail banks have doubled over the past decade, while their combined branch footprint shrank by 15 percent over the same period. This reverse correlation is even sharper for the top five US banks—while reducing branches by 15 percent, they increased deposits by 2.
While there have been previous periods of branch contraction, they were clearly tied to economic downturns; this most recent wave of retrenchment has persisted through a period of robust economic growth.
Retail-banking branch networks are contracting across Europe, North America, and the United Kingdom Exhibit 2 , although the pace of change varies considerably between regions.
Those that are ahead of the curve have reduced branches by as much as 71 percent Netherlands. Banks in North America and Southern Europe are reducing branches and growing digital sales at a more gradual rate. The rate of branch reduction is often tied to customer willingness to purchase banking products online or on mobile devices.
Eighty to 90 percent of banking customers in the Nordics, for example, are open to digital product purchases for most financial products, compared to 50 to 60 percent in North America and Southern Europe. While customer willingness to purchase products via digital channels varies, however, the common thread is that in all markets this readiness is far ahead of actual digital sales and will require banks to catch up to consumer needs and expectations.
Within any specific market, of course, there are banks that have acted swiftly to adopt digital and remote as their main channel for interactions; these banks are pulling away from the pack and have taken decisive actions on several fronts:. Across all retail businesses—including banks—customers now expect interactions to be simple, intuitive, and seamlessly connected across physical and digital touchpoints.
Banks are investing in meeting these expectations but have struggled to keep pace. Many are hampered by legacy IT infrastructures and siloed data. As a result, few banks are true leaders in terms of customer experience. Even for institutions ahead of the curve, typically only one-half to two-thirds of customers rate their experience as excellent. The impact of this less-than-stellar performance is measurable.
For example, McKinsey analysis shows that in the United States, top-quartile banks in terms of experience have had meaningfully higher deposit growth over the past three years Exhibit 3. These banks know that customer experience is not just about the front-end look and feel, but that it requires discipline, focus, and investment in the following actions:.
Larger retail banks have historically been more efficient than their smaller competitors, benefiting from distribution network effects and shared overhead for IT, infrastructure, and other shared services. Our analysis of over 3, banks around the globe shows that while there is variation across countries, larger institutions tend to be more efficient both in terms of cost-to-asset and cost-to-income ratios. However, beyond a certain point, even larger institutions struggle to eke out efficiencies or realize benefits from scale.
We expect this paradigm to change over the next few years, as structural improvements in efficiency ratios and increasing returns to scale enable some large banks to become even more efficient. The reason is twofold: first, advances in technologies such as robotic-process automation, machine learning, and cognitive artificial intelligence—many of which are now mainstream and commercially viable—are unleashing a new wave of productivity improvements for financial institutions.
Deployed effectively, these tools can reduce costs by as much as 30 to 40 percent in customer-facing, middle-, and back-office activities, and fundamentally change how work is done. Dramatic change has already taken place in banking sectors such as capital markets , where algorithmic trading and automation are radically changing the talent profile.
The second factor leading to a wave of productivity improvement in retail banking is the shift from physical to digital channels for customer acquisition. Banks with scale—and skills in leveraging that advantage—will achieve customer-acquisition costs of up to two to three times lower than their smaller peers.
Their outsized volumes of customer data will lead to better targeting and funnel conversion. As investments shift toward digital channels, the productivity gap between large and small banks will widen. This dynamic has played out in more digitally mature industries, with firms like Amazon and Priceline acquiring customers at a significantly lower cost than competitors.
As in these industries, eventually a limited number of dominant firms will emerge, squeezing out undifferentiated midsize and smaller competitors. There are early signs of this trend: undifferentiated smaller community banks in the US have lost a significant share of deposits over the last two to three years, while the three largest banks have gained share.
Of course, scale is not everything. Banks that succeed in this new wave of productivity will also have taken the following actions:.
The tight one-on-one retail-banking relationships of old are unbundling. Forty percent of US households today hold a deposit account with more than one institution. It is common to have a mortgage with one bank, an unsecured loan with a different lender, and separate deposit and investment accounts.
The banking relationship is fragmenting even faster in countries with higher digital adoption. This decline of customer loyalty provides a perfect context for firms seeking to enter banking in a selective way— focusing on the most profitable segments. New entrants in financial services typically begin by focusing on a niche—making either a product- or segment-focused play. Their ambition, however, is often to own the full banking relationship of this segment over time—providing cards, mortgage products, and broader banking services.
The requirement for banks to share data and provide access to consumer and small-business accounts through a common framework of application programming interfaces is likely to fuel a wave of innovation and level the playing field for fintechs and technology providers seeking entry through payments or consumer financing.
The trend toward unbundling in financial services is well under way, but where it will lead is still an open question. In industries such as music, television, e-commerce, and transportation, digital distribution led to unbundling that destroyed value for incumbents in the short term; over time, consumers tend to converge on a single provider—often an attacker.
In this context, firms that effectively orchestrate platform or ecosystem environments tend to eventually emerge as winners. The history of the music industry over the last 20 years provides a possible model for how things will go in banking. In the early s, digital distribution, especially via iTunes, radically reduced distribution costs.
Streaming services are now the dominant distribution channel, with a few large players such as Spotify and Apple emerging as winners. The success of these platforms is based on their ability to create highly personalized bundles based on consumer needs and preferences, and a superior interface without the friction of purchasing tracks individually. Leaders have created significant value for consumers by using customer data and insights to deliver a superior experience, rather than by manufacturing the underlying product.
If we apply this scenario to banking, winning firms will be those that leverage superior access to customer data to provide truly differentiated and cutting-edge experiences—potentially extending beyond financial products and services.
Banks that rebundle effectively will use this data to deliver compelling and integrated experiences that provide seamless funding, investment, payments, and money-movement capabilities. The bottom line is that in order to reverse the unbundling of financial services, banks need to make it worthwhile for consumers to have a relationship with one institution; they need to deliver not only simplicity and convenience, but also superior value. Only a few banks in each market are likely to be able to succeed with this strategy.
Already, large technology firms such as Amazon are extending into parts of the financial-services value chain, starting with areas where they have a data advantage such as payments, short-term financing for purchases, and working-capital loans for merchants on their platform.
To counter the unbundling of their most profitable products, banks need to develop capabilities that few currently possess, and follow the lead of successful technology platforms:. Retail banking is at an inflection point, and we expect the pace of change to accelerate significantly over the next three to five years. Success will require clarity in direction, and speed and agility in execution. Retail banks that capitalize on current shifts in the market will emerge with a winning position in their core markets and begin to compete across borders.
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If you would like information about this content we will be happy to work with you. Related Articles. Article Customer mindshare: The new battleground in US retail banking. Article The balancing act: Omnichannel excellence in retail banking. Article Customer experience as a value driver in German retail banking. Something went wrong. Please try again later.
18 Types of Bank Services
In the modern world, banks offer a variety of services to attract customers, However, some. After keeping certain cash reserves, banks provide short-term, medium-term and long-term loans to needy borrowers. Sometimes, the bank provides overdraft facilities to its customers through which they are allowed to withdraw more than their deposits. Through this method, a holder of a bill of exchange can get it discounted by the bank, in a bill of exchange, the debtor accepts the bill drawn upon him by the creditor i. After making some marginal deductions in the form of commission , the bank pays the value of the bill to the holder. When the bill of exchange matures, the bank gets its payment from the party, which had accepted the bill. Banks provide cheque pads to the account holders.
Policymakers around the world call for more competition in the banking sector. One prerequisite to achieving this is customer mobility. Moreover, we find that the reported propensity to switch varies across banking products. For the main current and savings accounts, this propensity is most strongly related to the bank-customer relationship, while for mortgage loans it is especially linked to switching experience. These findings have important implications for antitrust policy; they provide an argument against using a cluster-based legal standard for the analysis of competition and in favour of a disaggregated approach. Regarding the effectiveness of hypothetical policy initiatives to lower switching barriers, we find that the reported switching propensity with current accounts is higher in the case of account number portability, while more knowledge of the existing switching service has no significant effect. Lastly, scenario analysis shows that a policy of allowing new foreign banks to enter the savings market is less promising for enhancing mobility than a policy that increases the number of domestic players.
22: РУЧНОЕ ОТКЛЮЧЕНИЕ ГЛАВА 35 Беккер в шоке смотрел на Росио. - Вы продали кольцо. Девушка кивнула, и рыжие шелковистые волосы скользнули по ее плечам. Беккер молил Бога, чтобы это оказалось неправдой. - Рего… Но… Она пожала плечами и произнесла по-испански: - Девушке возле парка. Беккер почувствовал, что у него подкашиваются ноги. Этого не может .
Pricing of Banking Products and Services : A Case Study of Commercial Banks in Zimbabwe
Это было лицо демона, черты которого деформировали черные тени. Сьюзан отпрянула и попыталась бежать, но призрак схватил ее за руку. - Не двигайся! - приказал. На мгновение ей показалось, что на нее были устремлены горящие глаза Хейла, но прикосновение руки оказалось на удивление мягким.
В попытке сохранить равновесие он резко выбросил руки в стороны, но они ухватились за пустоту. Внезапно он взвился в воздух и боком полетел вниз, прямо над Беккером, распростертым на животе с вытянутыми вперед руками, продолжавшими сжимать подсвечник, об который споткнулся Халохот. Халохот ударился сначала о внешнюю стену и только затем о ступени, после чего, кувыркаясь, полетел головой. Пистолет выпал из его рук и звонко ударился о камень. Халохот пролетел пять полных витков спирали и замер.
Один из мужчин был крупного телосложения, в очках в тонкой металлической оправе с разбитыми стеклами. Второй - молодой темноволосый, в окровавленной рубашке. - Халохот - тот, что слева, - пояснил Смит.
Banking Product Terms
Ничего серьезного, - ответила Сьюзан, хотя вовсе не была в этом уверена. Следопыт задерживается. Она подумала, не ошиблась ли где-то. Начала просматривать длинные строки символов на экране, пытаясь найти то, что вызвало задержку. Хейл посматривал на нее с самодовольным видом.
Можете оставить свое имя и адрес - наверняка мистер Густафсон захочет вас поблагодарить. - Прекрасная мысль. Альфонсо Тринадцатый. Очень хорошо, прямо сейчас туда загляну.
Она не могла понять, что задержало его так надолго. У ее ног лежало тело Хейла. Прошло еще несколько минут. Она пыталась не думать о Дэвиде, но безуспешно. С каждым завыванием сирены слова Хейла эхом отдавались в ее мозгу: Я сожалею о Дэвиде Беккере.