What comes in our mind when we think of “Bank” what picture you see in your mind when you visit any bank? Lots of Cabins, Special Branch Manager cabin, Q in front of 2 cabins for deposits & withdrawal of money, etc.. am I right ??? yes I am bank is nothing but in layman language where you can deposit & withdraw money this is what we call it as Traditional Banking method where banks were much focusing on deposits & withdrawal, lending of loans etc.
Now the entire banking system has changed, now most of private player has entered in the market because of which competition has increased as Private players are providing much better banking services as compared to public players.
These days because of tough competition banks have turned themselves as not only for deposits or withdrawal of money but also banks are playing a major & vital role in regards with Financial planning of customers / acts as an investment advisor.
Almost all banks today have come with some or the other financial products either they start themselves or some Investment companies get tied up with banks to sell their products to the customers of bank, like we have ICICI group which is into Insurance, Mutual fund, Banks Investment Management thus an ICICI bank has many product to sell to their customers. Lets take another example of IBDI Bank which got tiedup with Fortis )a renowned healthcare company of India ) to provide health care plans to the customers of IDBI Bank and the list goes on.
Now you came to know the shift of traditional banking business to modern banking business. Now let us know that weather Banks really play a vital role as an investment Advisor.
What you do when you want to plan for investments/savings????? Offcourse you would go to an LIC agent because LIC is a dominant player and their agents are spreadout in more numbers however they lackprofessionalism and they would mostly slap you with some or the other LIC product so that they can earn commission… I hope this has experienced by many people.
If not LIC agent wher will you go??? But natural your second thought would be your own bank yes your own bank which is into business of not only banking but also investment advisor now you will think ofprofessionalism right?????, we think of trained, knowledgeable, intelligent advisors that will tell us exactly what we need to do, in terms of everything from cash in our accounts to documentation to investment avenues, advisors who will always keep us up to date on the best place to invest our hard earned money.
Now let us see who really does business of investment consultant/ advisor in a bank. Bank has a separate department of consulting wherin they have expert professionals who can advise you for investment & savings. They may be Sales Managers/Relationship Officers/Managers/ Financial Planning manager etc. designations might be different in different banks however their role remains the same “Sale of financial product” please note I have some reasons why I have highlighted the sentence sale of Financial Products. Think & re think again yesss these experts are recruited for sale of financial products & not to advice for the best investment options available in market suitable for the customer taking into consideration of his income & savings.
To Be continued.......
Related to Is Your Bank Really Your Best Investment Advisor? (PART I)