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UNIT - I

Learning Objectives:

After reading this chapter you will be conversant with:



Meaning and Definitions of Financial services



Kinds of Financial services



Evolution and growth of these services



Nature and characteristics of financial services



Goods marketing v/s service marketing



Strategic financial services



Services Marketing triangle

The Financial services sector in India is blooming and has become one of the

lucrative areas to professionalism. The sector has undergone metamorphosis

since 1990. Indian economy got liberalized during 1991 and the financial sector

was kept open for private and foreign players. During the late eighties, the

financial services industry in India was dominated by commercial banks and

other financial institutions governed by the Central Government. The economic

liberalization has brought in a complete transformation in the Indian financial

services industry.

Prior to the economic liberalization, the Indian financial service sector was

characterized by various other factors, which was related to the growth of this

sector. Some of the factors of significance are as follows:



Too much of control and regulation by the apex bodies in the

form of interest rates, money rates etc.



Controller of capital issues used to regulate the prices of

securities



Absence off independent credit rating and credit research

agencies.



Strict regulation of the foreign exchange market



Restrictions on foreign investment and foreign equity



Non-availability of debt instruments on a large scale.

However, after the economic liberalization the entire financial sector has under

gone a sea-saw change and now new financial instruments are entering the

capital market on a daily basis. The present scenario in the Indian Capital

market is characterized by financial innovation and financial creativity.

Financial services basically mean all those...