Financial Services Marketing

If you are looking for job in Financial Services Marketing, then checkout these frequently asked job interview questions in Financial Services, to prepare yourself for the job interview.

Q.1 What is the prime factor for growth of financial service sector?

Affluence is the prime factor for growth of financial service sector.

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Q.2 What is the aim of segmentation in marketing of financial services?

Isolating consumer behavioural differences which impact marketing decisions

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Q.3 Which body governs the mutual funds in India?

SEBI governs the mutual funds in India.

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Q.4 What is the investment target for gilt funds?

Government securities

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Q.5 Why are financial services considered important?

Financial services enable the government to raise both short-term and long-term funds to meet both revenue and capital expenditure. Aso, through the money market, the government raises short term funds by the issue of Treasury Bills. These are purchased by commercial banks from out of their depositors' money.

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Q.6 What are the different forms of financial leases?

• Capital lease
• Operating lease
• Sale and lease back
• Leveraged lease
• International lease
• Domestic lease

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Q.7 What are the types of International Factoring.

• Single or direct factoring system
• Direct export factoring
• Direct import factoring
• Back to back factoring

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Q.8 Name the type of mergers.

• Horizontal Merger
• Vertical Merger
• Conglomerate Merger
• Acquisition

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Q.9 What are the primary functions of financial markets?

• Price Determination.
• Funds Mobilization.
• Liquidity.
• Risk sharing.
• Easy Access.
• Reduction in Transaction Costs and Provision of the Information.
• Capital Formation.

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Q.10 What are financial Services?

The word "financial services" refers to the services provided by the finance industry. The phrase "financial services" is frequently used to denote businesses that deal with money management. Banks, investment banks, insurance firms, credit card companies, and stock brokerages are all examples.

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Q.11 What are the benefits of factoring?

Allow for more liquidity. Reduces the danger Services of expertise Increase your profit margins. saving time

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Q.12 What is the purpose of housing finance?

A housing finance system's objective is to offer cash for home buyers to purchase their properties. This is a straightforward goal with a finite number of options for achieving it. Despite this basic simplicity, extraordinarily intricate home financing systems have arisen in a number of countries, largely as a result of government activity. The ability to transfer funds from investors to those purchasing homes, however, must remain a key part of any system.

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Q.13 Explain the various types of Domestic factoring?

• Recourse Factoring
• Non-Recourse Factoring
• Advance Factoring
• Confidential and Undisclosed Factoring
• Maturity Factoring.
• Supplier Guarantee Factoring B
• ank Participation Factoring

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Q.14 What is the difference between factoring and Bill of Exchange?

Bill discounting is usually recourse-based, whereas factoring can be recourse-based or not. In the event of recourse, the factor does not assume the credit risk; instead, the credit risk is assumed by the company. Factoring is an off balance sheet transaction in the sense that both the number of receivables and the amount of bank credit are not represented on the balance sheet, whereas bill discounting is. Bill discounting merely provides finance, whereas factoring provides additional services such as sales ledger administration, collection, and so on in addition to finance.

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Q.15 Define Lease.

Lease is a financial contract between a business client (user) and an equipment supplier (usually the owner) for the use of a specific asset/equipment for a set period of time in exchange for monthly payments known as lease rentals.

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Q.16 Explain Hire Purchase.

Hire Purchase is a type of installment purchase in which the businessman (hirer) agrees to pay for the equipment in several installments over time. This payment covers the principal and interest costs associated with the acquisition of an item throughout the duration of the asset's use.

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Q.17 What is Fee Based Financial Services?

Financial services are products and services provided by financial institutions such as banks of various types to facilitate various financial transactions and other related activities in the world of finance, such as loans, insurance, credit cards, investment opportunities, and money management, as well as providing information on the stock market and other issues such as trends. Financial services that are paid for a flat charge rather than commission are known as fee-based financial services.

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Q.18 Define Venture Capital.

Investors contribute venture funding to start-up enterprises and small organisations that are thought to have long-term growth potential. Venture capital is an important source of funding for start-ups that do not have access to traditional sources of funding. For investors, the risk is usually significant, but the disadvantage for the startup is that venture capitalists usually have a say in corporate choices.

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Q.19 What is the difference between mergers and acquisition?

A merger occurs when two businesses of roughly comparable size decide to function as a single entity rather than being owned and operated separately. In order for a merger to take place, both firms must relinquish their stock in order to form a new company and issue new stock. An acquisition is when one company buys the other. In a merger or acquisition, the acquiring business will be entitled to all of the target company's assets, properties, equipment, offices, patents, trademarks, and other intellectual property. The acquirer will either pay cash or grant compensation in the form of shares in the acquirer's company.

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Q.20 What are the disadvantages of Mergers And Acquisitions?

Your balance sheet should be rationalised. Obtaining funding at current interest rates Obtaining flexible terms that match your cash flow plan's requirements, etc. Keeping track of your finances Streamlining transaction terms with financial institutions Liquidity protection

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Q.21 Explain the term loan.

A loan agreement in which a lender lends money or property to a borrower in exchange for the borrower agreeing to return the property or repay the money at a later date, usually with interest. Typically, a loan has a fixed repayment period, and the lender must take the risk that the borrower will not repay the amount.

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Q.22 What is Forfeiting?

Export trade finance method, particularly when dealing with capital products or high-risk countries. A bank advances cash to an exporter in exchange for invoices or promissory notes guaranteed by the bank of the importer. The amount advanced to the exporter is always 'without recourse,' and is always less than the invoice or note amount because the bank discounts it. The discount rate is determined by the terms of the invoice/note as well as the level of risk involved.

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Q.23 Define Bills.

A bill is a promissory note issued by a seller to a buyer that commits the seller to paying a set sum to the bearer or a designated person on or before the maturity date.

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Q.24 What are the disadvantages of factoring?

It is really expensive. The seller, the debtor, and the factor are the three parties involved in factoring. It aids in the creation of an immediate cash inflow. The factor has taken on the debtor's whole culpability in this case. Factor reserves the right to pursue any legal action necessary to collect the debts.

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Q.25 Explain the term lease agreement.

A written or implied contract in which the owner of a specific asset, such as a parcel of land, a building, equipment, or machinery, grants a second party exclusive possession and use of that asset for a specific period and under specified conditions in exchange for periodic rental or lease payments.

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Q.26 Define Housing Finance.

Housing finance pulls together a variety of complicated and multi-sector concerns that are influenced by dynamic local factors such as a country's legal or cultural environment, economic structure, regulatory environment, or political system.

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Q.27 State the parties to loan syndication

• Borrower
• Lead arranger
• Agent
• Participating Bank

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Q.28 What is Portfolio Management?

Portfolio management is the art of establishing the best investment policy for an individual in terms of least risk and maximum return. Portfolio management is the process of managing an individual's investments, such as bonds, stocks, cash, and mutual funds, in order to maximise returns within a set time frame. The term "portfolio management" refers to an individual's money being managed under the expert guidance of a portfolio manager.

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Q.29 Define Domestic Factoring.

Domestic factoring refers to the acquisition, funding, management, and collection of short-term accounts receivable deriving from the supply of goods and services to domestic customers. Goods are distributed on a 180-day open account credit basis.

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Q.30 What are the advantages of venture capital?

Obtaining venture capital financing can provide a start-up or fledgling business with a vital source of guidance and counsel in addition to cash backing. This can aid in a range of corporate decisions, such as financial and human resource management. Additional information: A VC firm can provide active support in a number of essential areas, including legal, tax, and personnel problems, which is very important at this stage in a fledgling company's growth. Two potential important benefits are faster expansion and higher success. Connections: Venture capitalists usually have a lot of connections in the corporate world.

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Q.31 What are Charges and fees payable for housing loan?

Fees for processing Charges for legal and documentation services Insurance premiums If you don't pay your installation bill on time, you'll be fined. Charges for technical services

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Q.32 Explain the importance of Financial Services.

Financial Services' Importance: Vibrant Capital is a term used to describe a city that is alive and well Financial s operations are expanded. Government's Advantages Development of the economy. Economic Development. Ensures a Higher Yield Returns are maximised. Reduces the chances of something bad happening.

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Q.33 What are the advantages of portfolio management?

Investors make well-informed choices. Improves the efficiency of the company Resource allocation that is fair Align goals and objectives All business processes are monitored.

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Q.34 Define Loan Syndication.

The process of enlisting numerous different lenders in supplying various sections of a loan is known as loan syndication. Loan syndication is most common when a borrower seeks a big sum of capital that is either too large for a single lender to give or outside the risk exposure limits of that lender. As a result, many lenders collaborate to supply the borrower with the funds they require.

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Q.35 What are the different types of Financial Services Organizations?

Banks Mutual savings banks Savings banks Building societies Credit unions Financial advisers or brokers Insurance companies

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Q.36 What are the benefits of Foreign Collaboration?

Optimum utilization of resources Technical assistance Economic development Improves standard of living Improves balance of payment International Relationship

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Q.37 Explain Debt restructuring.

Debt restructuring is the process of reforming a company's whole debt capital. It entails rearranging the balance sheet items, which comprise the company's debt commitments. A company's financial manager must always consider methods for lowering the cost of capital and increasing overall efficiency, which necessitates a continuous evaluation of the debt portion and recycling it to optimum efficiency.

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Q.38 Define Equity restructuring.

The process of reforming equity capital is known as equity restructuring. It entails reorganising the shareholders' capital as well as the reserves that appear on the balance sheet. Restructuring equity and preference capital is a complicated process that involves a legal process and is heavily regulated.

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Q.39 What are the features of venture Capital.

The following are characteristics of venture capital: Innovative projects are the focus of venture capital investments. Long-term benefits from such investments may be obtained. Venture capital providers invest money in the form of equity capital. Because venture capital is invested in the form of equity capital, the venture capital providers are involved in the company's management.

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Q.40 Explain International Factoring.

International factoring is a clever and straightforward notion. Factoring acts as a form of export insurance. Factors, who normally work for a factoring company, guarantee the exporter's import price. The exporter is the one who employs the factor. The cash flow from the importer to the exporter is entirely in the hands of the factor. Credit is essentially outsourced to the factoring provider.

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Q.41 What are the disadvantages of Leasing?

Only the right to utilize the asset is granted under the lease. If the leasing company goes out of business, the asset may be taken back from the lessee, causing him to lose money. The lease is prohibited from altering or improving the asset without the permission of the lessor. The leasor may also impose some lease limitations. The lease is responsible for paying the lessor lease rentals on a regular basis.

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Q.42 Define Service Economy.

One or both of two recent economic trends can be referred to as the service economy: In developed economies, the service industry is becoming increasingly important. In comparison to earlier decades, the current Fortune 500 list comprises more service companies and fewer manufacturing.

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Q.43 What are Development Banks?

Development banks are institutions established primarily to provide infrastructure for a country's economic development. They offer financial support to both governmental and private sector businesses.

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Q.44 What is Financial Planning?

The process of evaluating the capital necessary and selecting its competition is known as financial planning. It is the process of establishing financial rules for an organization's purchase, investment, and administration of funds.

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Q.45 What do you understand by Commercial Banks?

A commercial bank is a type of financial organisation that handles all deposit and withdrawal operations for the general public, as well as providing investment loans and other services. These are profit-making institutions that do business solely for the purpose of making a profit. Lending and borrowing are the two most important qualities of a commercial bank. The bank accepts the deposits and distributes the funds to various initiatives in order to earn interest (profit). The borrowing rate is the rate of interest that a bank gives to depositors, whereas the lending rate is the rate at which a bank lends money.

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Q.46 Explain the term Financial Management Models.

Financial modelling is the process of constructing a spreadsheet that contains a summary of a company's expenses and earnings and may be used to evaluate the impact of a future event or decision.

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Q.47 What is interest rates analysis?

Banks and other lenders will lend money to consumers at a certain interest rate. It's their profit margin—their product is debt, and the interest rate (represented as a percentage) is how much money their consumers pay for it.

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Q.48 Define inflation.

Inflation is the gradual loss of a currency's buying value over time. The increase in the average price level of a basket of selected goods and services in an economy over time can be used to calculate a quantitative estimate of the rate at which buying power declines. A rise in the general level of prices, which is frequently stated as a percentage, signifies that a unit of currency now buys less than it did previously.

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Q.49 Explain the term Liabilities of Financial Institutions.

The bank's liabilities are the debts it owes to others. The bank, in particular, owes any deposits made in the bank to the depositors. Total assets minus total liabilities equals the bank's net worth, or equity. To get the T account balance to zero, net worth is added to the liabilities side.

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Q.50 What are the objectives of Development Banks?

The main objectives of the development banks are 1. to promote industrial growth, 2. to develop backward areas, 3. to create more employment opportunities, 4. to generate more exports and encourage import substitution, 5. to encourage modernisation and improvement in technology, 6. to promote more self employment projects, 7. to revive sick units, 8. to improve the management of large industries by providing training, 9. to remove regional disparities or regional imbalance,

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Q.51 What is the importance of financial planning?

The significance can be summarised as follows: It is necessary to guarantee that sufficient money are available. Financial planning aids in maintaining stability by ensuring a reasonable balance between outflow and inflow of funds. Financial planning means that fund providers can readily invest in organisations that follow financial planning guidelines. Financial planning aids in the development of growth and expansion plans, which aid in the company's long-term sustainability. Financial planning decreases the risks associated with changing market patterns, which may be readily addressed with sufficient finances.

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Q.52 What are the types of Commercial Banks?

Commercial banks are divided into three categories. A private bank is a commercial bank in which private individuals and businesses own the majority of the stock. All private banks are classified as limited-liability corporations. Housing Development Finance Corporation (HDFC) Bank, Industrial Credit and Investment Corporation of India (ICICI) Bank, Yes Bank, and other financial institutions are examples. A public bank is a sort of nationalised bank in which the government owns a large part. Bank of Baroda, State Bank of India (SBI), Dena Bank, Corporation Bank, and Punjab National Bank are just a few examples. Foreign banks are banks that have their headquarters in another country and have branches in other nations. American Express Bank, Hong Kong and Shanghai Banking Corporation (HSBC), Standard & Chartered Bank, Citibank, and other financial institutions are examples.

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Q.53 What is the most important function of a Bank?

The most important role of a bank is to gather public deposits and lend those deposits for the growth of business, agriculture, trade, and commerce.

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Q.54 What is the first commercial bank of India?

The Bank of Calcutta is India's oldest commercial bank. In the year 1806 it was founded. The Bank of Bengal was afterwards renamed. It is now known as the State Bank of India.

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Q.55 What do you understand by Market Targeting?

Market Target refers to a group of customers a business which decided to aim its marketing efforts and ultimately its merchandise towards a well-defined target market is the first element of a marketing strategy. Basically a target market refers to a group of people considered likely to buy a product or service.

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Q.56 What do you understand by Service Blueprinting?

Service blueprinting refers to an operational planning tool which offers guidance on how a service will be provided, by specifying the physical evidence, staff actions, and support systems as well as infrastructure required to deliver the service across its different channels.

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Q.57 What do you understand by Green Marketing?

Green marketing refers to the marketing of products that are assumed to be environmentally safe. Such that green marketing incorporates a range of activities, such as product modification, production process changes, sustainable packaging, as well as modifying advertising.

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Q.58 What do you mean by Services of Marketing?

Services of Marketing refers to the promotion of economic activities offered by a business to its clients. Service marketing includes the process of selling telecommunications, health treatment, financial, hospitality, car rental, air travel, and professional services.

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Q.59 What do you understand by service recovery?

Service recovery is the process of including customer satisfaction into the definition, service recovery as it is a thought-out, planned, process of returning aggrieved/dissatisfied customers to a state of satisfaction with a company/service recovery that differs from complaint management in its focus on service failures and the company’s immediate reaction to it.

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