FINANCIAL ANALYSIS

Financial Analysis

Financial Analysis

Part A

Extract 1

In order to understand the basic purpose of these regulations and why they are in place, we need to understand how the selling of financial products actually take place and what are the grey area which needs clarity in terms of consumer transparency. in order to that, we should understand the challenges in selling of financial services first. The financial products and services are a particular type of goods that pose challenges specially to Marketing. These challenges include:

Intangibility

Inseparability

Limited differentiation

Confidence

Geographical dispersion

Balanced growth at risk

Fiduciary responsibility

Labour

Intangibility

Financial services fill a need general monetary instead of a specific need tangible. Accordingly, providers of financial services must get their message effectively and ensure attractive image. A financial service may not appeal to the senses of depositor, but rather, provides an intangible benefit.

Inseparability

Financial services are produced and distributed at the same time. The main concern is merchandiser, thus providing the right service at the right time and place. This requires being near the customers. Additionally, the presentation of the savings product is very important.

Limited differentiation

Financial services are very similar to each other. The reasons for choosing a supplier over another are often associated with convenience. This is especially true for small depositors whose demand for a savings product is often overly dependent interest rates.

Confidence

The provision of financial services implies a close relationship between the producer and consumer. Thus financial relations are constructed often over a long period of time and are very sensitive to changes in confidence another.

Geographical dispersion

Because proximity is a key factor in providing financial services, large financial institutions must offer a extensive branch network, numerous outlets or home services for

ensure the satisfaction of local and regional needs. Except in the case of Recent developments of high technology such as banking via the Internet, the financial institutions can not be expected to serve a large customer base if only distribute their products and services centrally.

Balanced growth at risk

Sell financial products, particularly credit products, involves risk. Consequently, organizational development should be well balanced with the ability of an institution to manage risk.

Fiduciary responsibility

The primary responsibility of a savings fund is the to safeguard the interests of depositors. The systems and procedures, along financial services should be structured according to this premise.

Labour

The provision of financial services requires a high component of labour. Although the automation, particularly the computerization, can effectively achieve the transactional management more efficient, financial services, particularly savings services, is to remain dependent on the personal relationship between customers and employees customer service of the institution.

The role of regulations in selling of financial products and services is as important as the role of regulation mentioned in the extract for the other industry. In financial marketing, most of the products are marketed in a way that it becomes very difficult for the consumer to understand their technicalities and the number gimmicks which are presented to them at the time of investment. In order to cope with these issues, there should be some regulations to deal with ...