Application of Digital Financial Services ”; Previous Next In today”s world, everything is digitized, which means we can access or get every service in digital format through mobile phones, computers, tablets, etc. The invention of computers and smartphones has created a huge impact on financial services. Today using computers and mobile phones, a person can access his/her bank account, verify account details, transfer funds, deposit cash, renew deposit, pay bills, book tickets, etc. Also, the invention of ATMs reduced the time taken to withdraw money from banks. Digital services help to save time by providing services in a single touch. The introduction of digital wallets has also made a big positive impact on financial services. In this topic, we are going to discuss in detail the importance of savings, importance of bank, banking products like accounts, deposits, loans, procedure for opening an account, banking services through a bank branch, ATM, internet banking, mobile banking, mobile wallets, insurance and various schemes introduced by the Prime Minister of India. Why are savings needed? Savings is the percentage of income which is not spent on present expenditures, instead conserved for future use. Being totally unaware of the future happenings, one should be ready to face any kind of unpredictable events. In such tough situations, our savings will be very helpful and beneficial to us. Emergencies Emergencies may come at anytime and we should always have a backup to handle such situations. Some examples of emergencies from our day to day life are − Personal and family health issues. Loss due to sudden natural calamities like flood, earthquake or cyclone, etc. Loss due to theft or any other unanticipated events. Sudden financial help for friends or relatives. Unplanned trips or any other plans. Future Needs Few future needs are listed below − Retirement The main purpose to save money is for your retirement. The earlier you start saving for retirement, the less you have to save in future. Saving for retirement makes you self-dependent and financially secure. Own a property Everyone dreams of owning a house. Though it is not an easy task, saving from early stages can help in fulfilling this dream. Own your own vehicle In today”s scenario, transportation has become difficult in metropolitan cities. To explore places with ease and comfort, a person needs a car. Education Cost of education has become a burden these days, especially for higher studies. In order to attain higher degrees, one should save money. To rescue debts and large expenses We should start saving to deal with large expenses like − Buying property: house or land Buying vehicles Buying gold or expensive jewelry Handling emergency needs like health-related issues Going on a family tour Facing complex situations during natural calamities Drawbacks of keeping cash at home Here, we list certain drawbacks of maintaining cash at home − Unsafe It is unsafe to keep cash at home as there is a chance of theft or robbery. Loss of Growth Opportunity Keeping cash at home causes huge loss to the country”s economy as it does not participate in national growth. Recurring Deposit −It is referred to as a monthly deposit for particular period of time for which the interest will be provided by banks to their customers. Fixed Deposit −It is bulk amount deposited by the customer for a fixed period of time, i.e., an year or two. In any of the schemes provided by banks, there will be profit. We can even earn interest or dividend by depositing our money in saving bank account. No Credit Eligibility A person should have minimum balance in savings account to apply for credit cards or loans. If we save money at home instead of banks, we can”t avail the credit facility provided by the financial institutions during tough times. Why is bank needed? Bank is an official financial institution that accepts money from public and lends money to public. Secure Money, Earn Interest, Get Loan Bank functions in various ways. Few of them are listed below − Secure Money Bank helps to save our money very securely. Loading all your cash at home isn”t safe. You can loose your money in situations like fire, flood or earthquake In order to avoid the scenarios given above, we need a bank. Earn interest Banks provide us with interest if we save money through RD and FD. In any of the schemes provided by the bank there will be an opportunity of growth in our money. Get Loan Bank will provide several kinds of loans if we satisfy the criteria issued by a bank and submit all necessary documents. Types of loans provided by bank are − Home Loan − Home loan is the money lent by banks to buy properties at a certain rate of interest to be paid every month as EMI. Personal Loan − Banks provide you with personal loans for marriage, emergency periods, etc. Jewel Loan − Banks provide you with jewel loans where you pledge your jewelry to get loan. Remittances using Cheque and Demand Draft Remittance is defined as the transfer of money or funds from one bank to another, either the same bank or different. Remittance can be done using Demand draft by Cheque, Pay slip, Mail Transfer, etc. A demand draft or “DD” is a popular mode of money transfer, where most of the banks in India use this for the effective transfer of money. Demand draft is usually issued on request of the client, for bill payments, and for transfer of property of deceased to legal heirs, etc. DD form requires the following details to be filled by the customer − Type of instrument needed. Receiver”s Name. Transmitter”s Name. Total amount to be transferred. The bank or location where the transferred money is to be funded. The way money is to be paid, i.e. in “Cash” or through a “Bank Account” in which you will pay money, i.e. in cash or by debit to your account. You should submit