Chapter: Business Services
VEEZNA GROUP OF INSTITUTES
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1. Nature of Services
Services are identifiable, intangible activities that provide satisfaction of wants and are not necessarily linked to the sale of a product.
- Intangibility: Cannot be touched or smelled. You can only experience the benefit.
- Inconsistency: Different customers have different requirements; services are performed differently each time.
- Inseparability: Production and consumption happen at the same time.
- Inventory (Less): Services cannot be stored for future use.
- Involvement: Participation of the customer is essential.
2. Banking Services Deep Dive
Beyond basic accounts, banks provide specialized financial services:
Bank Draft vs. Banker's Cheque:- Bank Draft: A financial instrument used to transfer funds from one person to another. It cannot be dishonored.
- Pay Order (Banker's Cheque): Similar to a draft but payable within the same city.
E-Banking: Use of electronic media to provide banking services. It includes Debit Cards (pay now), Credit Cards (pay later), and Digital Wallets.
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3. Types of Insurance
Insurance is broadly classified into Life and General Insurance.
| Type | Description |
|---|---|
| Life Insurance | Protecting the life of a human being. It acts as both protection and investment. |
| Fire Insurance | Covers loss or damage to property caused by fire. Max term is usually 1 year. |
| Marine Insurance | Protects against perils of the sea (Cargo, Hull, or Freight insurance). |
4. Telecom Services
The backbone of modern business communication. Key types include:
- Cellular Mobile Services: Voice, SMS, and data services.
- Fixed Line Services: Fiber optic cables for high-speed connectivity.
- VSAT Services: Satellite-based communication for remote areas.
- DTH Services: Direct to Home satellite services.
5. Warehousing: Evolution
Warehouses are no longer just storage spaces; they provide "Value Added Services" like packaging, labeling, and grading.
Bonded Warehouses:These are very important for international trade. They allow importers to store goods without paying customs duty immediately. Duty is paid only when goods are removed.
Important Examination Questions
Answer: If a person has taken multiple insurance policies for the same property, they cannot claim total loss from all companies. The insurers will share the loss in proportion to the amount insured by each.
Answer: Life insurance is a contract of 'assurance' (event is certain) and is an investment. Fire insurance is a contract of 'indemnity' (loss may or may not happen) and is strictly for protection.
Answer: Real Time Gross Settlement. It is a system where money is transferred from one bank to another on a 'real-time' and 'gross' (individual) basis. Minimum amount is ₹2 Lakhs.
