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FINANCIAL INTERMEDIARIES

ENVIRONMENT

Group Number - 11
Devesh Jain

- 16FN041

Mohammed Junaid S

- 16FN070

Rajat Kathuria

- 16FT083

Achanta Leela Kiran

-16MKT008

Definition and Classification

Financial intermediary acts as bank that consolidate


various deposits and turn them into loans for other
Financial intermediary is a common channel
between people who would like to save money and
people who would like to borrow money
Channel can be both direct one or indirect one
Borrowers like to see long term gains whereas
lenders plan for short term investment

Types of Financial Intermediaries

FINANCIAL INTERMEDIARIES

NON-MONAETARY

MONETARY

COMMERCIAL

CO-OPERATIVE

MUTUAL FINDS

INSURANCE

DEVELOPMENT
FINANCIAL
COMPANIES

Major Financial Intermediaries in India


Ministry of Finance

RBI

SEBI

IRDA

Commercial
banks
Co operative
banks
Financial
institutions

Mutual funds

Capital
market entity

Insurance

Trends In Financial Intermediaries

Advancement in technology
Regulatory reforms
Dark pool trading

Advancements In Technology

Due to advancement in technology the approach for


investments and money sources have changed
It has made accessing information much easier than
before
The people today, are able to access banking sectors
easily, making services more feasible and less costly
E-net , mobile networking, apps now a days are
making service a lot easier

Regulatory Reforms

The regulation in reforms by IRDA where a new


distribution avenue called point of sale is
introduced, where a person can sell simple
insurance polices
The pradhan mantri mudra yojana is where small
entrepreneurs can use beneficiaries from government
for capital purpose
Tax exemption on capital gains has been prolonged
to merger of different type of schemes with mutual
fund schemes which can be used in advantage during
merging of mutual funds

Regulatory Reforms

The Government has launched the Micro Unit


Development and Refinance Agency (MUDRA) to
fund and promote Microfinance Institutions
(MFIs), which can fund small business
communities
There is exemption on service tax on life insurance
under the National Pension System as regulated by
Pension Fund Regulatory and Development
Authority (PFRDA) with effect from April 1, 2016

Regulatory Reforms
Now with government taking serious steps towards
banking reforms Under Pradhan MantriJan
DhanYojna (PMJDY) a.) 210 million accounts have been opened
b.) 174.6 million RuPay debit cards have been issued
This will have a positive impact on online
purchasing trend in India specially tier 1 and tier 2
cities

Regulatory Reforms

Also, the relaxation of foreign investment rules has


received a positive response from the insurance
sector, with many companies announcing plans to
increase their stakes in joint ventures with Indian
companies
Indian equity market is also growing at a very
decent pace in recent years. The annual turnover in
NSE has seen a Compounded Annual Growth Rate
of 20.7 % between 1996-2015 to touch $718 million

Dark Pool Trading

In dark pool trading the transactions held are not


revealed out
It provides individual investors more benefits and it
avoids any impact on market
Due to dark pool trading there can be negative
impact of large volumes on financial intermediaries

Company Chosen Infibeam .com

Infibeam

Infibeam was started in 2007 by Vishal Mehta as an


Automobile portal but later it switched to become
an online retailer
Infibeam recently became Indias first E-Commerce
company to file an IPO in July 2015
Its strategy to launch Pi, Indias first book reader
was described by Forbes as "that seems to defy
most standard models"

Infibeam

Following the growth model in 2008 it acquired


Picssquare.com and Odigma in 2014
Looking into the diverse businesses the company is
in, we think it has potential to grow at a good pace
with comparatively lesser risk involvement

Organizations involved in Launching IPO of Infibeam

SBI Capital Markets Limited


ICICI Securities Limited
Kotak Mahindra Capital Company Limited
Elara Capital (India) Private Limited
Link Intime India Private Limited

Biggest upcoming market for Infibeam : Mutual Funds


SEBI set to allow e-commerce firms to sell mutual
funds
In order to promote selling of mutual funds and to
make them more accessible to people a SEBI panel
has now decided to allow e commerce websites to sell
mutual funds on their platform.
This will lead to major change in market dynamics as
e commerce websites like Amazon, Flipkart, Paytm,
Snapdeal, Infibeam will also become intermediaries
apart from being only online market places.

References
https://en.wikipedia.org/wiki/Financial_intermediary#Ty
pes_of_financial_intermediaries
https://en.wikipedia.org/wiki/Dark_liquidity#Dark_pool
_aggregators
http://www.ibef.org/industry/financial-services-india.asp
x
https://www.capgemini.com/resource-file-access/resour
ce/pdf/Trends_in_the_Global_Capital_Markets_Industry_
_Financial_Intermediary_Firms.pdf
High-frequency trading: Up against a bandsaw by
Jeremy Grant, ft.com, 02/09/2010
http://www.ft.com/intl/cms/s/0/b2373a36-b6c2-11dfb3dd- 00144feabdc0.html#axzz1bJ74HGU8

References
http://www.livemint.com/Money/A8lxzHlb09YAp
4eBEVGqJI/Sebi-set-to-allow-ecommerce-firms
-to-sell-mutual-funds.html
http://www.dnaindia.com/money/report-sebi-to
-allow-sale-of-mfs-on-e-commerce-websites-21
38670
http://www.moneycontrol.com/news/mf-experts/
joining-e-commerce-platform-isnew-beginningfor-mutual-funds_5124661.html
http://www.sebi.gov.in/cms/sebi_data/attachdoc
s/1435726888407.pdf

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