Basics of Investment Banking

An investment bank is a type of financial intermediary that performs a variety of functions such as underwriting, facilitating mergers and acquisitions or brokerage services for institutions. The work of an investment bank begins right from the counseling before the underwriting sessions, and stretches right till the securities are properly handled and distributed.

The role of an investment bank as a mediator is to directly familiarize the nature of the investment and the entity being invested in. In case of conventional banking, people deposit finances in the form of cash, assets and so on with a bank. The bank in turn can lend to a borrower under some standard norms to utilize in his own way. In the case of investment banking, there is a direct familiarization of both the investor and the borrower. This means that an individual or institutional investor has an option to choose his type of investment or division of investment into any given entity looking out for funds. An investment bank can also assist investment in the financial market.

Investment Banking

Tips to Secure Mobile Banking Services

The use of mobile phones nowadays is not limited to making calls and texting. People use their phones to check e-mails, browse the Internet, and to carry out banking functions like account transactions, balance checking, account activity (withdrawals, deposits, etc.) alerts, changing PINs, just to name a few. Mobile banking is growing exponentially, and with sensitive financial information available at the touch of a finger, safety is the topmost concern for customers and banks to avoid any fraudulent activity. Here’s how you can secure your mobile banking services to keep all your financial data from harm.

Security Tips for Mobile Banking

Use Authentic Banking Software
Make sure you install authentic software on your mobile phones, and ensure it is from a trusted and approved source. Most of the banking software for mobile phones is developed by third-party firms, so before you download anything, confirm with the bank for the authenticity and the latest version.

Password Protection
Protect your mobile with a password, and set the maximum number of incorrect passwords a user tries to enter to three. After three unsuccessful attempts, the mobile should automatically wipe out all the data that is stored on it for security reasons. Choose passwords that are composed of alphanumeric and special characters, and those which others cannot guess. Do not use date of birth, SSN, or any names as passwords. Change your password once a month.

PIN Protection
Change the personal identification number (PIN) or access code provided by the bank at the first attempt. Use a combination of numbers that is difficult to guess for anyone, and does not include SSN or date of birth. Change the PIN regularly and do not repeat the same PIN. Banks usually take precautions in this case and do not allow users to reuse PINs frequently.

Manage Personal Information
Avoid storing your bank account details (account number, credit/debit card number, PIN) on your phone. Do not use the auto-fill option on the browser which stores your mobile banking user ID and password. Never share these details or any other information with others through texts and e-mails via your phone. Make it a point to go through your account statements on a regular basis if you are into mobile banking and bring any unusual activity to the notice of the bank immediately. If you receive paper statements, save them in case you need to track your transaction details; they might also be helpful to reverse a transaction you never actually carried out. If you have signed up for text alerts, you should be alerted of every activity being carried out on your account. If you give your mobile for repair, delete the browsing history, cache, and any other temporary folders that may contain sensitive data so that it does not fall into the wrong hands. Disable any mobile banking application you might have downloaded. Keep the Bluetooth feature disabled if not in use. Install an antivirus software on your mobile device which will protect the data and keep malicious viruses away. Always remember to log out from the banking application after you have completed your banking transactions. Never log in to your banking account over a non-secure Wi-Fi network, like the ones at a coffee shop or a shopping mall.

Mobile Banking Services

Pros and Cons of Joint Checking Accounts

Defining joint checking account, it usually involves two people operating the account for saving or for specific projects. It is also called a safe haven for people who are less risk prone. With such an account, people find it easy to manage their money by getting to know about each other’s expenditure. While managing this type of account couples or friends can set up a clear cut budget, target on how much money should be saved every month and can also opt for certificate of deposit in order to gain interest on the savings. Many banks have a variety of joint checking accounts where minimum opening deposit is as low as $100. In these type of accounts you can avail free mobile banking, online banking, account alerts and free online bill payment.

Even though managing this account is difficult at times when one of the partner tends to be extravagant, but with honestly talking about financial matters and future savings this issue can be solved.

Advantages of a Joint Checking Account

Prevents Overdraft
Through this account the risk of falling into an overdraft is avoided. With this account both of you can keep a tab on the finances and alert each other if the spending is huge and savings are getting exhausted easily. If one of you tends to spend a lot then it’s wise to opt for overdraft protection service which most of the banks offer free.

Helpful in Paying Bills Online
Through this account one can pay bills online without falling into hassles of checkbook and credit cards. Through this both of them can check on their transactions and curb unnecessary bills.

Surviving Spouse
In case of death of either one the joint account is not frozen or closed unlike separate account. So the surviving partner can still have access to the account and operate it without any problems.

Helps in Learning Money Management
Joint account serves as a boon for people who spend without thinking. With a financial consultant in home advising you to start saving I think it works pretty well. It makes you responsible for your spouse and your future. It instills a sense of humility where you are not compelled to save money but you do it out of your own free will.

Pros and Cons

Difference between Bank and Financial Institution

In any given economy, there are numerous financial institutions – including banks, insurance companies, credit card companies, investment funds, consumer finance companies, etc. Even though a bank is a financial institution in itself, it differs from other financial institutions mentioned above by a significant extent. The most prominent difference between banks and other financial institutions is the fact that they provide the facility of depositing cash by resorting to savings account – something which most of the non-banking financial institutions are not entitled to do.

Financial Institutions

One has to first understand what financial institutions are, because bank in itself is one of the various financial institutions that exist in an economy. Basically, the term financial institutions encompasses several economic setups which provide financial services to its members or clients. This includes various deposit taking institutions such as banks and credit unions, as well as non-banking institutions such as insurance companies, investment funds, brokers, etc. Most of these financial institutions are regulated by the government. The most important function of these financial institutions is to channelize funds between lenders and borrowers indirectly.

Banks

As we mentioned earlier in this write-up, a bank is a financial institution in itself – a deposit taking financial institution to be precise. As with most of the other institutions listed above, even banks acts as financial intermediaries. Basically, banks allow consumers deposit money in savings accounts and lend the same money in form of various loans. Banks are among the most strictly regulated financial institutions in any economy. While the basic concept of a bank is same in all the countries, the restrictions on these banks may differ from one country to another.

Difference between Bank and Other Financial Institutions

It is a tough task to compare bank and financial institutions owing to the fact there exist several financial institutions, and each of these differ from banks by a significant extent. Basically, differentiating between banks and financial institutions is similar to comparing a deposit taking financial institution with a non-deposit taking financial institution. (If that criteria is taken into consideration both financial set-ups differ from each other on the basis of depositing facility, which is only provided by banking institutions as opposed to their non-banking counterparts.) That’s true to a certain extent, but it is by no means complete.

Even though banks are deposit taking financial institutions themselves, they can at times differ from other deposit taking financial institutions as well. For instance, credit unions also allow consumers to deposit (or borrow) money, but in order to avail this facility you need to be a member of this credit union and by becoming a member of the credit union you automatically become one of its owner. Yet another noteworthy difference between a bank and a finance company is the fact that former indulges in various business transactions, savings as well as investment, while the latter mainly focuses on investment and stabilization of currency.

Bank and Financial