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I - Financial System

Financial markets allow for the exchange of capital between participants. They include institutions like banks and non-banks that act as intermediaries between savers and borrowers. Financial markets also include the money market for short term lending and capital markets for long term lending. In recent decades, the Indian financial system has become more globalized and innovative financial products have been engineered to suit varied needs.

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Aditya Anand
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25 views9 pages

I - Financial System

Financial markets allow for the exchange of capital between participants. They include institutions like banks and non-banks that act as intermediaries between savers and borrowers. Financial markets also include the money market for short term lending and capital markets for long term lending. In recent decades, the Indian financial system has become more globalized and innovative financial products have been engineered to suit varied needs.

Uploaded by

Aditya Anand
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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FINANCIAL MARKETS

Financial System & Markets

- Dr. Sandeep Goel


FINANCIAL
SYSTEM

FINANCIAL FINANCIAL
INSTITUTIONS MARKETS
Financial
Institutions

Non-
Regulatory Intermediaries
Intermediaries

- RBI Banking Non- Banking NBSFO/DFIs


- SEBI (IFCI, NABARD)
UTI, LIC, GIC
- IRDA
- PFRDA
Scheduled Non-Scheduled
Financial
Markets

Money Capital
Market Market

Financial
Markets

Primary
Secondary
Market /
Market
New Issue Market
ART MARKET
• Vast Market

• Focus on Market for Impressionist, Modern and Contemporary


Paintings and Sculpture (i.e., 1860-1960)

• Diversification benefit

• Enjoyable investment

• Basic economics apply : Return vs. Risk

• Less liquid - i.e. time lag


-contd.-

In 2017, India’s art market


around Rs. 1,460 crore.

http://www.theartstrust.com/ArtMarket_cycle.aspx?article=5
FINANCIAL INNOVATIONS
Globalisation
 After liberalization in 1991, the Indian financial system has gone really
global.
 Since 1992, the Indian corporate houses can directly access the
overseas financial markets. ADRs and GDRs for raising equity finance,
and External Commercial Borrowing (ECB) for debt finance.

Financial Engineering
 This refers to the design of innovative products to suit the specific
needs of the lenders as well as the borrowers.
 Thus securities are essentially viewed as bundles of cash flows that
may be taken apart and repackaged as per the needs
Eg. ULIP
REVERSE MORTGAGE
• A Pension plan for a family to use fully-paid principal residence
while continuing to live in it during retirement.

• Who Offers Reverse Mortgages?


 NATIONAL BANKS
 MORTGAGE COMPANIES - NBFCs

• Who Qualifies?
 Homeowner(s) aged 60 or older
 Own your home with your name(s) on title
 Tax- free installment income
 Medical conditions have no effect on eligibility
 No pre-payment plenty

Best for people who want the security of a monthly income for
the rest of their lives.

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