WHAT IS BANKING
Banking is a business activity of accepting and securing money owned by individuals and enterprises, which also involves transactions carried out to produce profits. It is a principal procedure which creates and controls the money supply of the country.
It not only provides liquidity needs for businesses and families to invest for the future but also makes use of its deposits to give out loans. The loan can either be short term or long term and it claims repayment in the form of installments. The bank also charges a certain amount of rate of interest on the amount sanctioned. The deposits collected from the customers can be of different types, namely savings, fixed, current and recurring deposits, respectively.
What is Banking Study ?
Banks have become an essential part of society and it’s no wonder many individuals choose to pursue their education and career in the banking sector. Banking courses are available for those who are interested in becoming a part of, or are already part of the banking and financial services industry.
Banking courses can be taken as an undergraduate degree with some institutions offering multiple banking specializations through one degree program. The most popular undergraduate banking degree offered is the BSc (Hons) Banking and Finance. This course will normally take three to four years of full time study to complete. Banking courses generally cover modules including finance, accounting, statistics, bank management and operations and banking law.
Those students looking to study a postgraduate degree can opt to study a Master’s degree in Banking, or choose a more specialised degree such as MA Banking and Financial Services. This degree type usually takes one to two years of full time study to complete.
Why Study Banking Course ?
Banking is a career that offers opportunities to students from all streams, be it humanities, commerce or science. However, to make a career in banking, you must be good at analysing numbers, that is, your mathematics must be strong enough to interpret and analyse numerical data. You must be prepared for the Banking Entrance Exams and for the interviews that follow these entrance examinations.
Is it the Right Career for Me ?
Banking as a career provides opportunities to students from all subjects. For instance, if you are a BA student with excellent communication skills, you can actually get placed with a banking BPO as process executive. Companies such as GE Money, Max New York and leading banks such as ICICI, HSBC, HDFC, Standard Chartered, American Express, to name a few, select students from colleges for their BPOs and KPOs.
Thus, choosing banking as a career is a wise option for those interested in growing fast in their careers and those who wish to get exposure to world markets at an early stage itself.
What would it Cost Me ?
The fees structure for a banking bachelor’s degree varies from Rs 10,000 to Rs 100,000 depending on the college you select. Private institutions such as NIIT (National Institute of Information Technology) offer diploma programs that cost between Rs 1 and 2 lakhs.
For a post graduate diploma or master’s degree, you may be expected to spend anywhere between Rs 50,000 to Rs 7,00,000 based on the college you select.
Several colleges such as IIPM, Amity, Birla Institute for Insurance provide laptops to students and take them on student trips to foreign companies abroad. This, in addition, is the advantage of getting admission in a private institution.
There are several ways to fund your banking degree. You may approach banks for educational loans or if you are a working professional with an organization that offers study programs to employees, your company may fund your studies and allow you to repay after a few years.
Job opportunities for graduates and post-graduates in banking are excellent in India. Once you complete a selective professional course in banking, you will immediately be offered a position as a banking sales officer with the private banks. Of course, your technical skills and basic communication skills do matter in the process.
Besides, positions in insurance, personal loans, mortgages, collections and back office operations are always vacant and offer all bright to average students to avail the opportunities presented.
Banks such as ICICI, HSBC, Kotak Mahindra, HDFC, Standard Chartered, Barclay’s, and American Express are some of the companies that hire banking students at all levels depending on the colleges they are recruiting from.
The pay scales for banking student who is a fresher could vary anywhere from Rs 8,000 to Rs 20,000 to begin with. Students who have post graduated from top b-schools and banking institutions can expect up to Rs 8 lakhs per annum for the role of relationship managers depending on their overall scores and the college they are from.
Several banking companies recruit Indian students from the IIMs, XLRI, FMS and other popular colleges every year for pay packages not less than Rs. 10 lakhs per annum.
However, please be wary that the financial markets are ever fluctuating and may all of a sudden cause crashes in career. There is a constant need to keep yourself updated with latest trends in banking so you remain relevant in your job profile.
Demand and Supply
Demand for banking process executives, collection officers and financial analysts with BPOs is the highest till date in India. There is still a considerable dearth of graduates, post-graduates who have mastered cost accounting.
Concepts such as Hedge Funds dominate the overseas markets. However, Indians still survive on 10 hour BPO and KPO jobs and definitely, these are excellent opportunities to begin with.
If you are a graduate in banking or any other degree with an aptitude for it, just go for it. There is always demand for banking professionals.
During the recession of 2009, the demand for banking professionals drastically reduced. Many top finance organizations went bankrupt and several others laid off thousands of employees in India.
However, in 2010, the situation is far better and the same enthusiasm has been revived. With popular mergers and acquisitions such as Royal Bank of Scotland and ABN Amro, people do see hope at the end of the tunnel. The world economy has revived itself to the post-recession challenges quite effectively.
The CAT scores and GMAT scores after graduation enable students to get into post-graduate programs in banking per se. However, even as a banking professional who joins after a BCom with a leading bank, you can look forward to excellent scope and growth in your career.
The international market offers challenging roles for banking professionals nonetheless.
Tips for Getting Hired
1. Be thorough with accounting and financial skills acquired in school and college.
2. Display a mathematical aptitude to impress the interviewers.
3. Speak to the point and measure everything quantitatively as you display your subject skills.
4. Carry your awards and certificates from school and college when you appear for the interview.
5. Be dressed formally and speak boldly as this is a prerequisite for all candidates appearing for interviews with banking organizations.
6. Assure the interviewers that you are a target-oriented person who loves daily challenges and narrow deadlines.
7. Assure the interviewers that you have no hassles working extra hours every day
Business banking is a company’s financial dealings with an institution that provides business loans, credit, and savings and checking accounts specifically for companies and not for individuals. Business banking is also known as commercial banking and occurs when a bank, or division of a bank, only deals with businesses. A bank that deals mainly with individuals is generally called a retail bank, while a bank that deals with capital markets is known as an investment bank.
BREAKING DOWN ‘Business Banking’
In the past, investment banks and retail/commercial banks had to be separate entities under the Glass-Steagall Act, but changes to the law made it so a single bank can deal with business banking, retail banking and investment banking. The Glass-Steagall Act is also known as the Banking Act of 1933, and was introduced to manage speculation. Parts of the act were repealed in 1999, making it no longer illegal for an investment bank to also engage in business/commercial and retail banking.
Services Offered by Business Banks
Business banks provide a wide range of services to companies of all sizes. In addition to business checking and savings accounts, business banks offer a range of financing options and cash management solutions.
- Bank Financing: Bank financing is a primary source of capital for business expansion, acquisitions and equipment purchases, or simply to meet growing operating expenses. Depending on a company’s needs, business banks can offer fixed term loans, short and long term, as well as lines of credit and asset-based loans. Banks are also a main source of equipment financing, either through fixed loans or equipment leasing. Some banks specialize in lending in certain industries, such as agriculture, construction and commercial real estate.
- Cash Management: Also referred to as treasury management, cash management services help businesses achieve greater efficiency in managing the cash coming into the business, or receivables; cash going out of the business, or payables; and cash on hand, or liquidity. Utilizing the latest digital technology, business banks set up specific processes for businesses that help them streamline their cash management, resulting in lower costs and more cash on hand.
Banks provide businesses with access to Automated Clearing House (ACH) and electronic payment processing for accelerating the transfer of money in and out of the business. They also allow for the automatic movement of money from idle checking accounts into interest-bearing savings accounts, so surplus cash is put to work, while the business checking account has just what it needs for the day’s payments. Businesses have access to a customized online platform that links their cash management processes to their checking and savings accounts for a real-time view of their cash in action.