Banks and financial institutions play a crucial role in economic development


Banks and financial institutions, being the prime source of credit, play a major role in the economic development of the country, a senior official at the StanChart bank said.

“The banks and financial institutions businesses generate income that gets cycled back into the economy. It is lenders that can help individuals and organisations through difficult times by lending short, medium and long term fund solutions,” Sai Narain, regional head consumer banking, Northern Gulf, Levant and Oman, in an interview said.

“For example, if banks were not around, how would people borrow for a family holiday, a new much needed car or a house? The banks use the deposits from people to then lend to others. The interest rates paid out to depositors are always less than those offered to borrowers and the bank makes its profit from the difference in rates as well the fees,” he added.

“With the rapidly changing global landscape, the internet banking enabled financial institutions to offer a faster, more convenient way of helping with finance. On-line banking has revolutionized the ways of doing-day-to-day business through efficient, reliable and hassle free channels,” Narain said while talking about the on-line banking.

With security measures and features now available through the web, he said, online banking is safe and secure.

Online banking was first introduced in the 80’s and has since grown to attract a large following.
“Online banking allows for the purchase of anything from groceries right the way through to insurance and savings plans or even a new car. In the West, these banks have increased in popularity as without the need for premises, their costs remain low and savings can be passed on to the customer through lower interest rates and lower or no transaction fees. It can also mean using online services provided by more traditional banks that do have retail street branches. In any case when deciding which online banking service provider to use, check on how easy it is to get in touch with a physical person. Also carry out research to confirm they are all legitimate and evaluate their offers and also read the terms and conditions to see you are not opening yourself up to hidden charges and fees. It is also very important to ensure that the online banking platform you use has high security measures in place and there have been no complaints about them – research can be carried out on the internet.”

While online banking does now have a big following, there are still some that are concerned about how safe and secure it is and so decide to continue to use the more traditional methods.
“Nonetheless it is unquestionable that internet banking will continue to grow as more secure technology is developed so those who currently feel the disadvantages outweigh the advantages might just change their opinion further on down the line,” he added.

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