What are the types of accounts in banks?

Correct Answer: Bank Rate is the interest rate at which the RBI allows finance to commercial banks By Bank Rate, we mean bank can regulate the level of economic activity

Correct Answer: The advantage of equity finance for a company ? raising money by selling shares ? is that this money does not have to be repaid However, new shareholders usually get to have a say in how the company is run Despite these rights, equity is often seen as a risky choice for investors as they will lose all their money if the company doesn?t prosper If it does well, on the other hand, they may see their stake multiply in value many times over Debt finance ? money raised through loans ? must be repaid eventually by a company, usually with interest, but lenders won?t be able to exert as much influence as shareholders over how the company does business The debt of a reliable company is usually seen as a safe investment, but fixed repayment schedules means that there are few opportunities for large returns

Correct Answer: Banks provide their clients with advice, assistance in arranging financing, and other services, such as access to trading on the markets, investment management, and risk reduction Their main source of revenue is the fees they charge their clients for these services Some banks have departments which invest or trade the bank?s own money to generate returns, though the extent to which they can do so has become more limited in recent years

Correct Answer: Much of your answer to this question will depend on your role ? so do some careful research into your chosen department In M&A, you might spend much of your time on financial models related to the deals you?re working on, while in a trading role you might start out by assisting more senior members of the team before being given the chance to manage a trading book yourself Beyond that, it?s important to show that you?ll be keen to take on responsibilities, but that you also recognise that your first year is about learning the ropes, usually means include following instructions from others and completing some mundane tasks

Correct Answer: As you?re interested in a career in banking, plenty of reasons should spring to mind, and if they don?t you should consider choosing another path! Often students are attracted to the intellectual challenges and high-profile nature of the dealings of the finance world, the fast pace of the work here, and the rewards on offer, all of which are very valid reasons for applying to a bank But they?re also valid reasons for applying for jobs in other parts of the finance world, so make sure you explain why you want a job at a bank, and in your chosen area in particular Perhaps you?re keen for the broad and deep financial training and prestigious experience that only a leading bank can offer? Your interviewers may also ask if anything puts you off banking If you have any real doubts, an interview is not the place to air them, but it?s a great idea to show that you?ve considered the difficulties the industry is currently going through before choosing to make an application You might say that you?re attracted to the particular professional challenges and opportunities a period of flux in an industry can offer

Correct Answer: Overdraft protection is a service that is provided by a bank to their customer For instance, if you are holding two accounts, saving and credit account, in the same bank Now if one of your accounts does not have enough cash to process the cheques, or to cover the purchases The bank will transfer money from one account to another account, which does not have cash so to prevent check return or to clear your shopping or electricity bills

Correct Answer: The repayment of the loan by instalment to cover principal amount with interest is known as ?Amortization?

Correct Answer: Foreign draft is an alternative to foreign currency; it is generally used to send money to a foreign country It can be purchased from the commercial banks, and they will charge according to their banks rules and norms People opt for ?foreign draft? for sending money as this method of sending money is cheaper and safer It also enables receiver to access the funds quicker than a cheque or cash transfer

Correct Answer: ?Endorsing cheque? ensures that the cheque get deposited into your account only It minimizes the risk of theft Normally, in endorsing cheque, the cashier will ask you to sign at the back of the cheque The signature should match the payee The image over here shows the endorsed cheque

Correct Answer: In ?Bill Purchase? the loan will be created for the full value of the draft and the interest will be recovered when the actual payment comes For example, a ?Sight draft? is presented for which the loan is created for 100% of the draft value The money is received after 7 days, and then the interest will be recovered for 7 days along with the principal amount