banking services

With years, banks are also adding services to their customers. The Indian banking industry is passing through a phase of customers market. The customers have more choices in choosing their banks. A competition has been established within the banks operating in India.

With stiff competition and advancement of technology, the services provided by banks has become more easy and convenient. The past days are witness to an hour wait before withdrawing cash from accounts or a cheque from north of the country being cleared in one month in the south.

This section of banking deals with the latest discovery in the banking instruments along with the polished version of their old systems.

Open bank account - the most common and first service of the banking sector. There are different types of bank account in Indian banking sector. The bank accounts are as follows:

Bank Savings Account - Bank Savings Account can be opened for eligible person / persons and certain organisations / agencies (as advised by Reserve Bank of India (RBI) from time to time)

Bank Current Account - Bank Current Account can be opened by individuals / partnership firms / Private and Public Limited Companies / HUFs / Specified Associates / Societies / Trusts, etc.

Bank Term Deposits Account - Bank Term Deposits Account can be opened by individuals / partnership firms / Private and Public Limited Companies / HUFs/ Specified Associates / Societies / Trusts, etc.

Bank Account Online - With the advancement of technology, the major banks in the public and private sector has faciliated their customer to open bank account online. Bank account online is registered through a PC with an internet connection. The advent of bank account online has saved both the cost of operation for banks as well as the time taken in opening an account.

Note :- A minor account can be opened but jointly with a guardian and only the guardian would is allowed to operate the account.

General procedure to open an account
The Bank will provide you with details of various types of accounts that you may open with the Bank.
You can have your choice on what type of account would best suit you, based on your needs and requirements
The Bank will, prior to opening an account, require documentation and information as prescribed by the "Know Your Customer" (KYC) guidelines issued by RBI and or such other norms or procedures adopted by the Bank prior to opening the account.
The due diligence process that the Bank would follow, will involve providing documentation verifying your identity, verifying your address, and information onyour occupation or business and source of funds. As part of the due diligence process the Bank may also require an introduction from a person acceptable to the Bank if they so deem necessary and will need your recent photographs.
The Bank is required by law to obtain Permanent Account Number (PAN) or General Index Register (GIR) Number or, where you do not possess such registration, declaration in Form No. 60 or 61 as specified under the Income Tax Rules.

In the event that the account opening process is likely to take longer than normal, the Bank will inform you of the revised timeline.
You can also call your branch or the executive for any queries that you may have and the branch / executive will revert on the query at the earliest.
The Bank will provide you with the account opening forms and other relevant material to enable you open the account. Bank personnel will advise you on the complete details of information that would be required by the Bank for the verification process.
The Bank reserves the right, at its sole discretion, to open any account and at such terms as the Bank may prescribe from time to time

Plastic money
Credit card
Debit card
Credit cards in India is gaining ground. A number of banks in India are encouraging people to use credit card. The concept of credit card was used in 1950 with the launch of charge cards in USA by Diners Club and American Express. Credit card however became more popular with use of magnetic strip in 1970.

Credit card in India became popular with the introduction of foreign banks in the country.

Credit cards are financial instruments, which can be used more than once to borrow money or buy products and services on credit. Basically banks, retail stores and other businesses issue these.

Major Banks issuing Credit Card in India
State Bank of India credit card (SBI credit card)
Bank of Baroda credit card or BoB credit card
ICICI credit card
HDFC credit card
IDBI credit card
ABN AMRO credit card
Standard Chartered credit card
HSBC credit card
Citibank Credit Card

Precautions taken after receiving credit card
To Avoid:
Bending the Card.
Exposure to electronic devices and gadgets.
Direct exposure to sunlight.
Be cautious about disclosing your account number over the phone unless you know you're dealing with a reputable company.
Never put your account number on the outside of an envelope or on a postcard.
Draw a line through blank spaces on charge or debit slips above the total so the amount cannot be changed.
Don't sign a blank charge or debit slip.
Tear up carbons and save your receipts to check against your monthly statements.
Cut up old cards - cutting through the account number - before disposing of them.
Open monthly statements promptly and compare them with your receipts. Report mistakes or discrepancies as soon as possible to the special address listed on your statement for inquiries. Under the FCBA (credit cards) and the EFTA (ATM or debit cards), the card issuer must investigate errors reported to them within 60 days of the date your statement was mailed to you.
Keep a record - in a safe place separate from your cards - of your account numbers, expiration dates, and the telephone numbers of each card issuer so you can report a loss quickly.
Carry only those cards that you anticipate you'll need.
To Do:
Please sign on the signature panel on the reverse of the Card immediately with a non-erasable ball-point pen (preferably in black ink). This will ensure that the benefits of membership are yours and yours alone.
Keep the Card in a prominent place in your wallet. You will notice if it is missing.

Reasons credit card being rejected at retail outlet:
One may have exceeded the borrowing limit or defaulted (constantly) on minimum payment due.
The Card is hotlisted.
The card has crossed its expiration date.
Non-receipt of dues of one-card blocks future transactions on any other card(s) held of the same card-issuing bank.
The magnetic stripe on the reverse of the card is damaged i.e. has been scratched or exposed to continuous heat/direct sunlight or magnetic field-like card kept near a TV set / other electronic appliances.
Systems or technology failures have in rare instances also led to non acceptance of cards when swiped through an Electronic Terminal.

Global player in credit card market

MasterCard

MasterCard is a product of MasterCard International and along with VISA are distributed by financial institutions around the world. Cardholders borrow money against a line of credit and pay it back with interest if the balance is carried over from month to month. Its products are issued by 23,000 financial institutions in 220 countries and territories. In 1998, it had almost 700 million cards in circulation, whose users spent $650 billion in more than 16.2 million locations.

VISA Card

VISA cards is a product of VISA USA and along with MasterCard is distributed by financial institutions around the world. A VISA cardholder borrows money against a credit line and repays the money with interest if the balance is carried over from month to month in a revolving line of credit. Nearly 600 million cards carry one of the VISA brands and more than 14 million locations accept VISA cards.

American Express

The world's favorite card is American Express Credit Card. More than 57 million cards are in circulation and growing and it is still growing further. Around US $ 123 billion was spent last year through American Express Cards and it is poised to be the world's No. 1 card in the near future. In a regressive US economy last year, the total amount spent on American Express cards rose by 4 percent. American Express cards are very popular in the U.S., Canada, Europe and Asia and are used widely in the retail and everyday expenses segment.

Diners Club International

Diners Club is the world's No. 1 Charge Card. Diners Club cardholders reside all over the world and the Diners Card is a alltime favourite for corporates. There are more than 8 million Diners Club cardholders. They are affluent and are frequent travelers in premier businesses and institutions, including Fortune 500 companies and leading global corporations.

JCB Cards

The JCB Card has a merchant network of 10.93 million in approximately 189 countries. It is supported by over 320 financial institutions worldwide and serves more than 48 million cardholders in eighteen countries world wide. The JCB philosophy of "identify the customer's needs and please the customer with Service from the Heart" is paying rich dividends as their customers spend US$43 billion annually on their JCB cards.

Grace / Interest Free Period

The number of days you have on a card before a card issuer starts charging you interest is called grace period. Usually this period is the number of days between the statement date and the due date of payment. Grace periods on credit cards are usually 2-3 weeks. However, there is likely to be no grace for balances carried forward from previous month and fresh purchases thereafter if any.

The following are some of the varieties of credit cards in India
ANZ - Gold
ANZ - Silver
Bank Of India - Indiacard
Bol - Taj Premium
Bol - Gold
BoB - Exclusive
BoB - Premium
Canara Bank - Cancard
Citibank - Gold
Citibank - Silver
Citibank WWF Card
Citibank Visa Card for Women
Citibank Cry Card
Citibank Silver International Credit Card
Citibank Women's International Credit Card
Citibank Gold International Credit Card
Citibank Electronic Credit Card
Citibank Maruti International Credit Card
Citibank Times Card
Citibank Indian Oil International Credit Card
Citibank Citi Diners Club Card
HSBC - Gold
HSBC - Classic
ICICI Sterling Silver Credit Card
ICICI Solid Gold Credit Card
ICICI True Blue Credit Card
SBI Card
Stanchart - Gold
Stanchart - Executive
Stanchart - Classic
Thomas Cook Standard Chartered Global Credit Card

Standard segregation of credit cards
Standard Card - It is the most basic card (sans all frills) offered by issuers.
Classic Card - Brand name for the standard card issued by VISA.
Gold Card/Executive Card - A credit card that offers a higher line of credit than a standard card. Income eligibility is also higher. In addition, issuers provide extra perks or incentives to cardholders.
Platinum Card - A credit card with a higher limit and additional perks than a gold card.
Titanium Card - A card with an even higher limit than a platinum card.

The following are some of the plus features of credit card in India
Hotel discounts
Travel fare discounts
Free global calling card
Lost baggage insurance
Accident insurance
Insurance on goods purchased
Waiver of payment in case of accidental death
Household insurance

Some facts of credit cards
The first card was issued in India by Visa in 1981.
The country's first Gold Card was also issued from Visa in 1986.
The first international credit card was issued to a restricted number of customers by Andhra Bank in 1987 through the Visa program, after getting special permission from the Reserve Bank of India.
The credit cards are shape and size, as specified by the ISO 7810 standard. It is generally of plastic quality. It is also sometimes known as Plastic Money.

FAQs
What does Grace / Interest Free Period Mean?
What is implied in Cash Advance?
How to make payments from Dubai to the already existing Citibank cards in India. How to avail of the statements to know the current bank balance of each card. Is online facility available?
Can I use my Global credit card on the net to pay some US company for web hosting charges? or I have to obtain permission from RBI. If any permissions are needed, How to get them?
How will I know if my Credit Card application has got approved?
How will I know if my Credit Card application has got declined?
What to do if Credit Card is Lost or Stolen?

What does Grace / Interest Free Period Mean?
The number of days given to you on your card before the card issuer starts charging you interest is called grace period. Generally the grace period is the number of days between the statement date and the due date of payment. Grace periods on credit cards are usually 2-3 weeks. However, there is likely to be no grace for balances carried forward from previous month and fresh purchases thereafter if any.

What is implied in Cash Advance?
Cash advances on Credit Cards are convenient and the easiest facility to utilise. Manority of the banks in India charge a transaction fee as well as service fee / interest charge on cash advances. This service fee accrues from the date of the advance (as soon as you receive the cash) to the date of full payment. The charges varies from banks to banks. Cash advance facility is a part of the overall credit limit assigned to a cardholder. The limit is of cash acvance is always lesser than the borrowing limit or the credit limit.

How to make payments from Dubai to the already existing Citibank cards in India. How to avail of the statements to know the current bank balance of each card. Is online facility available?
According to RBI " Resident Indians may be nominated as additional/add-on card holders by non-residents. However, the non-residents from their foreign currency funds should meet claims arising out of use of such cards by residents only.In cases where the cards have been arranged by NRIs these liabilities may be met out of NRE/FCNR accounts in India also. Under no circumstances will any remittance be allowed by residents from India to settle their claims against use of such additional/add-on cards". NRIs get rupee credit cards which are valid for use in India, Nepal and Bhutan.

Can I use my Global credit card on the net to pay some US company for web hosting charges? or I have to obtain permission from RBI. If any permissions are needed, How to get them?
The RBI's exchange control manual mentions that 'International Credit Cards' can be used for "Registration of Internet domain name, hosting charges for website/home pages overseas and access fees for Internet related services through website". Before using your Global Credit Card on the net for web hosting charges, you further clarify the aforesaid issue or seek permission from your card issuer. Even get in touch with the card issuing bank or organisation directly for such clarifications.

How will I know if my Credit Card application has got approved?
It is suggested to give your mobile number and e-mail id at the time of application for the Credit Card. This will help the issuer to intimate you either through SMS or through e-mail with the approved status of your application. You will also receive a letter by post informing you of the Card approval. You should be receiving your Card around the same time as the approval letter.

How will I know if my Credit Card application has got declined?
You will receive a letter from the Bank even if your application for Card is not approved. If in case there is a further information of missing documents, you will be sent a letter asking for the same. Then you need to fulfil with the documents to the specified address.

What to do if Credit Card is Lost or Stolen?
Report the loss or theft of your credit cards to the card issuers to the earliest through their 24-hour helpline service. Follow up your phone calls with a letter. Include your account number, when you noticed your card was missing, and the date you first reported the loss.

After doing these, check your homeowner's insurance policy to see if it covers your liability for card thefts. If yes its fine otherwise change your policy to include this protection.

Before the intimation, different banks have their own limit of loss bearing by the card holder. After the intimation, it is the bank who bears the loss if any amount is spent.
Debit cards
Debit cards, also known as check cards look like credit cards or ATM cards (automated teller machine card). It operate like cash or a personal check. Debit cards are different from credit cards. Credit card is a way to "pay later," whereas debit card is a way to "pay now." When we use a debit card, our money is quickly deducted from the bank account.

Debit cards are accepted at many locations, including grocery stores, retail stores, gasoline stations, and restaurants. Its an alternative to carrying a checkbook or cash.

With debit card, we use our own money and not the issuer's money.

In India almost all the banks issue debit card to its account holders.

Features of Debit Card
Obtaining a debit card is often easier than obtaining a credit card.
Using a debit card instead of writing checks saves you from showing identification or giving out personal information at the time of the transaction.
Using a debit card frees you from carrying cash or a checkbook.
Using a debit card means you no longer have to stock up on traveler's checks or cash when you travel.
Debit cards may be more readily accepted by merchants than checks, especially in other states or countries wherever your card brand is accepted.
The debit card is a quick, "pay now" product, giving you no grace period.
Using a debit card may mean you have less protection than with a credit card purchase for items which are never delivered, are defective, or were misrepresented. But, as with credit cards, you may dispute unauthorized charges or other mistakes within 60 days. You should contact the card issuer if a problem cannot be resolved with the merchant.
Returning goods or canceling services purchased with a debit card is treated as if the purchase were made with cash or a check.

Tips for responsible use of Debit Card
If your card is lost or stolen, report the loss immediately to your financial institution.
If you suspect your card is being fraudulently used, report it immediately to your financial institution.
Hold on to your receipts from your debit card transactions. A thief may get your name and debit card number from a receipt and order goods by mail or over the telephone. Your card does not have to be missing in order for it to be misused.
If you have a PIN number, memorize it. Do not keep your PIN number with your card. Also, don't choose a PIN number that a smart thief could figure out, such as your phone number or birthday.
Never give your PIN number to anyone. Keep your PIN private.
Always know how much money you have available in your account. Don't forget that your debit card may allow you to access money that you have set aside to cover a check which has not cleared your bank yet.
Keep your receipts in one place -- for easy retrieval and better oversight of your bank account.

Loans
Banks in India with the way of development have become easy to apply in loan market. The following loans are given by almost all the banks in the country:
Personal Loan
Car Loan or Auto Loan
Loan against Shares
Home Loan
Education Loan or Student Loan
In Personal Loan, one can get a sanctioned loan amount between Rs 25,000 to 10,00,000 depending upon the profile of person applying for the loan. SBI, ICICI, HDFC, HSBC are some of the leading banks which deals in Personal Loan.

Almost all the banks have jumped into the market of car loan which is also sometimes termed as auto loan. It is one of the fast moving financial product of banks. Car loan / auto loan are sanctioned to the extent of 85% upon the ex-showroom price of the car with some simple paper works and a small amount of processing fee.

Loan against shares is very easy to get because liquid guarantee is involved in it.

Home loan is the latest craze in the banking sector with the development of the infrastructure. Now people are moving to township outside the city. More number of townships are coming up to meet the demand of 'house for all'. The RBI has also liberalised the interest rates of home loan inorder to match the repayment capability of even middle class people. Almost all banks are dealing in home loan. Again SBI, ICICI, HDFC, HSBC are leading.

The educational loan, rather to be termed as student loan, is a good banking product for the mass. Students with certain academic brilliance, studying at recognised colleges/universities in India and abroad are generally given education loan / student loan so as to meet the expenses on tuition fee/ maintenance cost/books and other equipment.

Money transfer
Beside lending and depositing money, banks also carry money from one corner of the globe to another. This act of banks is known as transfer of money. This activity is termed as remittance business. Banks generally issue Demand Drafts, Banker's Cheques, Money Orders or other such instruments for transferring the money. This is a type of Telegraphic Transfer or Tele Cash Orders.

It has been only a couple of years that banks have jumped into the money transfer businessess in India. The international money transfer market grew 9.3% from 2003 to 2004 i.e. from US$213 bn. to US$233 bn. in 2004. Economists say that the market of money transfer will further grow at a cumulative 10.1% average growth rate through 2008.

With the use of high technology and varieties of product it seems that "Free" money transfers will become commonplace. We will see more bundling of tailored money services by banks and non-traditional entrants that will include "free" money transfers. Many banks will even use money transfer services as loss-leaders inorder to generate account openings and cross-sell opportunities. The price evolution of money transfer products for banks will be similar to that of consumer bill pay-the product is worth giving away as an account acquisition tool to win overall market share and establish banking relationships.

ATM money transfer card products have had terrible bank adoption rates since being introduced in the last three to four years. Remittees who are highly educated and have been already been exposed to ATM technology in receiving countries tend to have an interest in this product. Money transfer to India is one of the most important part played by the banks. This service provide peace of mind to either the NRIs or to the visitors to India. Many Indian banks have ATM'S (automatic teller machine), enable to draw foreign currency in India.

By 2007, we will see a good percent of all foreign-born households doing some level of online banking. First-mover banks will start having a window of opportunity to include online transfer functionality within the next couple of years, which currently frequents traditional money transmitters such as Western Union. There is a terrific opportunity for banks and non-banks to offer more robust global inter-institutional funds transfer services online. More than half of Western Union's customers today are already banked, and most do not have an alternative product marketed by their bank that is painless, quick, and cost-effective. That will change as banks offer transfer services through their online channel.

The following are the details of few banks to check for transferring money to India
Name Address Tel Fax Email Web Site
Allahabad Bank delib@allahabadbank.co.in www.allahabadbank.com

ABN Amro Bank Hansalaya Building, 15,Barakhamba Road, New Delhi 110001 9111-2375-5470 www.abnamroindia.com

BANK OF INDIA C - 5, "G" Block, Bandra Kurla Complex, Bandra (East), Mumbai 400 051 9122-5668-4444 hofbd@bankofindia.co.in www.bankofindia.com

Bank of America (Asia) Ltd. www.bankofamerica.com

Central Bank of India P.B.No.7007, Link House,Press Area, B.Z. Road New Delhi 110002 9111-331-9268 9111-371-2677 cbi.del.net.in@bol.net.in www.centralbankofindia.com

HSBC 25, Barakhamba Road, New Delhi 110 011 www.in.hsbc.com

Development Credit Bank Shree Amba Shanti Chambers Opp. Leela Galleria Andheri-Kurla Road, Andheri - E Mumbai 400059 9122-2823-5725 customercare@dcbl.com www.dcbl.com

Export-Import Bank of India Centre One Building, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005 9122-2218-527 9122-2218-2572 eximcord@vsnl.com www.eximbankindia.com

THE FEDERAL BANK Federal Towers, Aluva - 683 101, Kerala 91-484-2623620 91-484-2622672 fbl@federalbank.co.in www.federal-bank.com

Indian Overseas Bank roplan@delsco.iobnet.co.in www.iob.com

Punjab National Bank 7,Bhikaiji Cama Place New Delhi -110066 9111-2617-6297 pnbibd@ndf.vsnl.net.in www.pnbindia.com

Reserve Bank of India Main Building, P.O.Box 901, Shahid Bhagat Singh Road, Mumbai-400 001 9122-2266-0500 rdmumbai@rbi.org.in www.rbi.org.in

State Bank of India www.sbi.co.in

UCO Bank D.N. Road, Mumbai ro.mumbai@ucobank.co.in www.ucobank.com


Money Transfer to India

Apart from banks few financial institutions and online portals gives services of money transfer to India. Some of them are as under:
Western Union Money Transfer
Union Money Transfer
IKobo Money Transfer
Cash2india.com
Remit2india
Samachar Money Transfer
Timesofmoney.com
Wells Fergo International Money Transfer
Travellers Express
Money Gram International
Visa money transfer
Visa has recently introduced the 'Visa Money Transfer' option for its savings and current account holder of any bank
with a visa debit card. This facility helps its customer to transfer funds from his bank account to any visa card, either debit or credit within India.

A Visa Money Transfer is of similar kind, in many respects, to the third-party fund transfer option given by some banks to its account holders through e-cheque, but this is restricted to only visa cardholders.

How to transfer money?
Log on to your bank account through your respective bank websites.
Fill the beneficiary details like visa card numbers, name, address and then specify the amount that needs to be transferred. For bank account specify the visa card number and credit card number for paying credit card bill.
Click on to VISA Transfer Payments button.
Transfer immediately or on schedule date. Your account will be debited according to the date mentioned.
Notable points of Visa Money Transfer
The time taken for money transfers could be the same or even more than that of a demand draft i.e. two or three days or even more.
Currently there are no charges but limits has been set by certain banks on the current transfers.
It is available in 150 cities across the country now.
The transferred amount can neither be changed nor stopped once it is initiated.