Definitions of Important Banking Terms D TO F (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) (y) > Debit Card : Debit card allows for direct withdrawal of funds from customers’ bank accounts. The spending limit is determined by the available balance in the account. > Deflation: Deflation is the continuous decrease in prices of goods and services. Deflation occurs when the inflation rate becomes negative (below zero) and stays there for a longer period. In Inflation we have two types demand pull (due to increase in demand), and cost push(due to increase in prices) > Demand Deposit : A demand deposit is the one which can be withdrawn at any time, without any notice or penalty; e.g. money deposited in a checking account or savings account in a bank. > DTC (Direct tax code): This is a provision that can replace age old Income tax act 1961.Since this act have loop holes (such as IT dept. Will have no jurisdiction over the fraud happened outside India even Indian company purchased or shares of Indian company sold), so by this code Govt. Will have power to curtail the menace of tax avoidance, and AAR (Authority for advanced ruling is a body by govt. Can act independently over these issues and grant permission for MNC’s that their ‘transfer of shares’,’ absorption/amalgamation’ is legitimate or not. > EMI (Emulated Monthly Instalment) : An equal amount repaid with the principal and interest amount of a loan on every month. > Endorsement : When the maker of the holder of the negotiable instruments sign on the back of the cheque to “Pay certain person”. It means transfer from one person to another person. > Equity: Equity is a one financial instrument by which company invite the public to invest their money in the company and investor can become a partner of the company. Generally, when the company have insufficient money to expand its business it comes with equity shares. Angel investors are the persons who will give financial help to a novice company to develop leaps and bounds. > Excise Tax: Tax imposed on specific goods and services, such as cigarettes and gasoline. Customs duty is levied on inter market boundaries, ‘cess’ is defined as tax on tax. > FCNR Accounts : Foreign Currency Non-Resident Accounts are the ones that are maintained by the NRIs in foreign currencies like USD, DM and GBP etc. The account is a term deposit with interest rates linked to the international rates of interest of the respective currencies. > Financial inclusion: The purpose of this plan is ‘the fruits of development should be distributed among the masses and the deprived classes of the society’, so different actions were taken up, such as BSBDA accounts (Basic savings bank deposit accounts, general purpose accounts to provide for every citizen of country by 01-01-2016 as part of financial literacy, and no frill accounts (no restriction loans will be given) to bail out economically backward sections and alleviate them from poverty. > Fiscal consolidation: It is the process at which the govt. Undertake austerity measures to put restrictions on its economy such as de licensing of industries, disinvestment from stack etc. Our India is following under RBI, a perfect measure by FRBM act (fiscal responsibility and budgetary management act) 2003. > Fiscal policy: Fiscal policy defines the use of government spending and revenue collection to influence the economy. > Fixed Deposits : FDs are the deposits that are repayable on fixed maturity date along with the principal and agreed interest rate for the period. Banks pay higher interest rates on FDs than the savings bank accounts. > Floating Rate of Interest : It refers to the movement i.e., interest rate on a period basis due to outside conditions of the market. > Foreign Direct Investment (FDI): Investment of foreign assets directly into a domestic companys structures, equipment, and organizations. It does not include foreign investment into the stock markets. Like us on - facebook/perfectguideforbanking
Posted on: Sun, 23 Nov 2014 06:09:31 +0000
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