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INDIAN FINANCIAL SYSTEM

INDIAN FINANCIAL SYSTEM. BY ANJU SANWAL. Flow of Presentation. Definition of Financial System Perfect Capital Market Types of Market. Definition of Financial System. Set of institutions, instruments and market System consists of individuals, intermediaries, markets and users of savings.

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INDIAN FINANCIAL SYSTEM

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  1. INDIAN FINANCIAL SYSTEM BY ANJU SANWAL

  2. Flow of Presentation • Definition of Financial System • Perfect Capital Market • Types of Market

  3. Definition of Financial System • Set of institutions, instruments and market • System consists of individuals, intermediaries, markets and users of savings. • Economic activity and growth are greatly facilitated by the existence of a financial system. • Important players are financial markets and financial institutions.

  4. PERFECT CAPITAL MARKET • Trading is costless and access is free • Information about borrowing and lending opportunities is freely available. • Large number of traders and no single trader can have significant impact on market prices. • It is externally as well as internally efficient.

  5. TYPES OF MARKETS • Money Market • Capital Market • Foreign Market

  6. Money Market in India

  7. Cont… • Bill Market – is a market where short term bills are bought and sold. • Treasury Bills – issued by government to meet short term requirement of the fund. • Commercial Bills – CB’s are also known as bill of exchange

  8. Cont… • Certificate of Deposits – issued by banks in multiples of Rs.25 lakhs to expands the investor base for CDs. • Commercial Paper – CP is issued by companies with a net worth of Rs. 10 Crores.

  9. Capital Market in India

  10. Primary Market Public Issues Offer for Sale Placement Right Issues Secondary Market Where existing securities are traded. Cont…

  11. Foreign Market • Purpose to facilitate transfer to purchasing power denominated in one currency into another • It links financial activities in different currencies • Primary function is to facilitate trade and investment

  12. Thank You

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