Important guidance points for interviews in the banking sector.
Introduction:
Securing a position in the competitive banking sector requires more than just qualifications; it demands strategic preparation and confident execution during interviews. In this blog, we delve into essential guidance aimed at empowering you to navigate banking sector interviews with ease and confidence. From researching the bank and understanding the job role to preparing a tailored resume and mastering common interview questions, each step is designed to enhance your interview performance.
Here are the types of banking products:
- Current Account & Saving Account (CASA):
- Current Account: Used for business transactions, with no or minimal interest on deposits.
- Savings Account: Designed for personal savings, often offering interest on deposits.
- Credit Card:
- A payment card that allows users to borrow money against a line of credit to make purchases, with the option to pay back the borrowed amount over time or in full.
- Debit Card:
- Linked to a bank account, allowing users to make transactions directly from their account without borrowing money.
- Loans:
Financial products that provide borrowers with funds in exchange for repayment with interest over a specified period. Includes various types such as:
- Home Loan: Specifically for purchasing residential properties.
- Mortgage Loan: A broader term for loans secured by real estate.
Other types like personal loans, car loans, education loans, etc.
- Insurance:
Financial protection products that provide coverage against risks such as health issues, accidents, property damage, etc.
Home Loan:
A home loan is a secured loan used to purchase a property. It offers substantial funding at favorable interest rates and for extended periods. Repayments are typically made through Equated Monthly Installments (EMIs). The property purchased serves as collateral, and once the loan is repaid, the ownership title is transferred to the borrower.
Mortgage Loan:
A mortgage loan is another secured loan where an immovable asset, like a house or commercial property, is pledged as security. The lender retains possession of the asset until the loan is fully repaid.
- KYC full form is ‘Know Your Customer’) which refers to the process of identity and addresses verification of all customers and clients by banks, insurance companies and other institutions either before or while they are conducting transactions with their customers.
- The Credit Information Bureau (India) Limited (CIBIL) is the most popular of the four credit information companies licensed by Reserve Bank of India. There are three other companies also licensed by the RBI to function as credit information companies. They are Experian, Equifax and Highmark.
Types of Loans:
- Secured Loans:
These loans require collateral and include home loans, loan against property (LAP), loan against insurance policies, gold loans, loans against mutual funds and shares, and loans against fixed deposits.
Types of Secured Loans:
- Home Loan
- Loan against property(LPA)
- Loan Against insurance policies
- Gold loans
- Loans against mutual funds and shares
- Loans against fixed deposits
- Unsecured Loans:
These loans do not require collateral and include personal loans, short-term business loans, flexi loans, education loans, and vehicle loans.
Type of unsecured loan:
- Personal Loan
- Short-term business loans
- Flexi Loans
- Education loans
- Vehicle loans
ROI (Rate of Interest):
In banking language, the Rate of Interest (ROI) refers to the percentage charged or earned on financial transactions like loans and deposits. Loan interest rates determine the cost of borrowing for customers, while deposit interest rates dictate the returns on deposited funds. Central bank policies, economic conditions, and risk assessments influence interest rate adjustments. ROI plays a crucial role in banking operations, contributing to revenue generation, risk management, and customer attraction. Regulatory frameworks oversee interest rate practices to ensure fairness and financial stability. Understanding ROI is essential for effective financial decision-making in both lending and investment activities.
Tenure:
In banking language, tenure refers to the duration or period for which a financial product or service is valid or active. For loans, tenure indicates the repayment period agreed upon by the borrower and the bank, typically ranging from months to years. Longer tenures may result in lower monthly payments but higher overall interest costs. In deposits, tenure specifies the duration for which funds are locked in, such as fixed deposit terms. Banks offer varying tenures to suit customer needs, with options for early closure or renewal. Understanding tenure helps customers plan their financial commitments and optimize returns or costs accordingly.
Conclusion:
In conclusion, mastering banking sector interviews requires diligent preparation and a strategic approach. By implementing the guidance provided in this blog, you are equipped to confidently navigate these interviews and stand out in the competitive finance industry. Embrace these insights to elevate your interview success and embark on a rewarding career journey in the banking sector.
