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Fee-Based Services of Banks

Fee-based services can be broadly classified into corporate and retail services. Common corporate services include cash management, letters of credit, bill discounting, foreign exchange, and credit rating. Retail services include money transfers, wealth management, and online trading. Pricing of corporate services is relationship-oriented and flexible, while retail services have standardized pricing. Fee-based services are distributed similarly to banking products through branches for corporate clients and technology for retail, though they are not heavily promoted. People and processes are important for high-quality delivery of these services.

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DrGaurav Vishwakarma
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445 views2 pages

Fee-Based Services of Banks

Fee-based services can be broadly classified into corporate and retail services. Common corporate services include cash management, letters of credit, bill discounting, foreign exchange, and credit rating. Retail services include money transfers, wealth management, and online trading. Pricing of corporate services is relationship-oriented and flexible, while retail services have standardized pricing. Fee-based services are distributed similarly to banking products through branches for corporate clients and technology for retail, though they are not heavily promoted. People and processes are important for high-quality delivery of these services.

Uploaded by

DrGaurav Vishwakarma
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Fee-Based Services

Importance of Fee-based Services

Corporate Fee-based Services

   Cash Management Services


   Letter of Credit and Bank Guarantee
   Bill Discounting, Factoring, and Forfaiting
   Foreign Exchange Services
   Merchant Banking
   Registrar, Underwriting, and Custodial Services
   Leasing
   Credit Rating

Retail Fee-based Services

   Money Transfer and Payment Services


   Wealth Management and Online Trading
   Other Value Added Services

Pricing

   Factors Influencing Pricing


   Pricing of Different Fee-based Services

Distribution and Promotion

   Distribution of Fee-based Services


   Promotion of Fee-based Services

People

Process

Chapter Summary
Fee-based services can be broadly classified into
corporate and retail fee-based services. Organizations
avail of such services for meeting both their short-
term and long-term financial requirements. The
common fee-based services offered to corporate
clients are: cash management services, letter of credit,
bank guarantees, bill discounting, factoring/
forfaiting, forex services, merchant banking, registrar
services, underwriting services, custodial services,
lease and hire purchase, and credit rating. Retail fee-
based services are availed of at large by the retail
customers for payments, money transfers, personal
wealth management, online trading, etc.

While pricing of corporate fee-based services are


relationship oriented and relatively flexible, retail fee-
based services have standardized pricing. Though fee-
based services are not promoted using the traditional
promotion mix in a major way, their distribution is
similar to that of banking products. For corporate fee-
based services, marketers use branches extensively,
whereas their retail counterparts use advanced
technology channels such as the Internet.

For wealth management services in the retail segment, relationship-based personal selling is
combined with the technology-oriented channels of distribution.

The active involvement of people is necessary for rendering fee-based services as the people
factor decides the quality of service delivery. Many of the service providers recruit candidates
from reputed colleges and institutions, and train them to handle the customer requirements.

The process factor in service delivery can be analyzed in terms of the flow of activities, the
number of steps involved in each activity, and customer involvement. Providers of fee-based
services take all these factors into account for achieving high levels of service quality.

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