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MSSP - Class 10 ppt

  1. 1. Financial Education Class X
  2. 2. Electronic Commerce E-commerce
  3. 3. E Commerce  It is a type of business model, or a segment of a larger business model, that enables a firm or individual to do business over an electronic network, typically the internet.  It is a step ahead of mail-order purchasing through a catalogue.  It offers a wide variety of products and services. For example, clothes, books, financial services to train/plane tickets.  It is a more convenient method of shopping in terms of time and efforts.  One can pay through debit/credit card or through cash on delivery.
  4. 4. Beware!! e-commerce
  5. 5. Things to be taken care of while using e-Commerce You need to take certain safety precautions while transacting online.  All you need to be careful about is: - Credit card borrowing limit. - Spams (unsolicited bulk business emails) - Availability of data pertaining to business on the online shopping website (street address, phone number of the company). - Privacy policy - Lock icon on the status bar - Select websites starting with “https:” - Keep records regarding all your online transactions. - Verify claims and be aware of False claims
  6. 6. Advisory  For ATM: - Watch for suspicious devices on the ATM machine to avoid data leakage. - Number of persons in ATM room should not be more than number of working ATM machines. - Don’t let anybody notice your ATM PIN. - Seek assistance only from the security guard in case of your card getting struck in the ATM machine. Do not seek help from strangers.
  7. 7. Advisory  For POS transactions using ATM/Debit card and Internet banking: - While transacting at merchant establishment (POS), keep eyes on the person swiping the card and always enter the PIN yourself. - Avoid using public computers like Cyber café for any e-commerce transactions/internet banking. - Make sure that your PC has latest antivirus, anti-malware, personal firewall etc.
  8. 8. Advisory (cont.) - Never respond to any email asking for your account credentials (PIN, expiry date, card number, etc.) or phishing mails about lottery. - Erase the CVV number on the backside of the card and memorize it or store it confidentially. - Avoid using phone devices unless the device is secure.
  9. 9. Financial Regulatory Bodies in India  The apex monetary and banking institution in India. India’s central bank.  An autonomous statutory body that protects investor’s interest in the securities market, promotes development of, and regulates securities and commodities markets.  A statutory body that regulates and develops insurance sector in India.  A statutory body that regulates the pension sector in India.  Reserve Bank of India Estab. April 1, 1935  Securities and Exchange Board of India Estab.1988 | SEBI Act 1992  Insurance Regulatory and Development Authority of India Estab. 1999  Pension Fund Regulatory and Development Authority Estab. August 23, 2003
  10. 10. New initiatives for the Policyholder Demand Side  The Integrated Grievance Management System (IGMS) offers an online system to register the complaints of the policyholder through IRDAI call centre.  Helps to track the status of the complaint on real time basis.  Call Centre educates the policyholders on available grievance redressal mechanism.  The regulator has launched an exclusive consumer education website www.policyholder.gov.in Supply Side  Insurers have developed innovative insurance policies.  Internet purchase of policy saves the client from paying any commission to the traditional agent.  The internet has made the service easily accessible.  People working at the back-end office, call centre are trained to provide correct information.  The processes have become customer friendly due to the speed and accuracy of service delivery.  Promotion through web aggregators and SMS technology.  Insurance policies can be stored in electronic form (e-Policies).
  11. 11. Insurance Ombudsman
  12. 12. The Scheme  The Insurance Ombudsman scheme was created by Government of India for individual policyholders to have their complaints settled out of the courts system.  Complaints are settled in a cost-effective, efficient and impartial way.  There are 12 Ombudsman Centres, covering the country.  One can approach the insurance Ombudsman if- i. Insurance company does not resolve the complaint after approaching them. ii. The complaint is not resolved to the satisfaction of policyholder. iii. the insurer has not at responded to it for 30 days.
  13. 13. Commodity Futures Market
  14. 14. Market A place where forces of demand (buyer) and supply (seller) operate or interact (directly or through intermediaries) to trade goods, services or contracts or instruments, for money. Spot Market Forward Market Ready Delivery Contract Forward Contract Segments of Commodities Markets
  15. 15. Forward Contract  Forward contract is a derivative contract.  A derivative contract is an enforceable agreement whose value is derived from the value of an underlying asset.  The underlying asset can be a commodity, currency, bond, stock, or, indices of commodities, stocks etc.
  16. 16. Futures or Hedge Contracts  Futures contract is one type of forward contract and are highly standardized.  They are traded on recognized Commodity Exchanges.  They are generally used for protecting against risk of adverse price fluctuation.  Participants in commodity futures markets are Hedgers, Speculators and Arbitrageurs.
  17. 17. Economic Depression
  18. 18. Economic Depression  The economic recession means general decline in economic activity.  It is a part of business cycle.  The recession is generally characterized by: - Decline in GDP - Decline in Industrial Output - Higher Unemployment - Decline in people’s spending
  19. 19. Investing in Shares
  20. 20. Basic Concepts  Equity  Face value of a share  Market Value  Premium  Dividend  Net worth of the company  The original value of stock.  Current value at which each stock trades.  Difference between market value and face value.  The share of profit received in proportion of one’s shareholding.
  21. 21. Initial Public Offering (IPO)  It is the initial offering of securities to the public.  SEBI registered merchant banker are responsible for selling the securities to the public.  They also investigate the company’s business and verify the financial information given to the investors.  The company must file a registration statement with the SEBI.  There is an offer document issued to the public to help them determine if they want to purchase the stock on offer.  IPO’s final price is determined on the basis of all the bid prices.  Allotment of shares is made on full or pro-rata basis after its price is determine.
  22. 22. Benefits of Insurance
  23. 23. Benefits to Individual and Society  Insurance is an arrangement by which a person can plan for continuation of income for self, family or business, under uncertainty, old age or death.  It is related to protection of human life and assets.  For society, it is an arrangement where many would contributes to mitigate losses of a few.  Greater longevity is achieved through- o improving living standards, o increasing productivity, and o making quality healthcare accessible.
  24. 24. Benefits to Economy  Life insurance contracts are long term contracts.  Investors become the principal source of capital for the economy by investing their funds.  Non-life insurance provides cover to trade and industry against losses due to uncertainties.  Government gets the capital investment needed to finance physical and social infrastructure through insurance.
  25. 25. Learning to Trade
  26. 26. Things to know before investing in stocks  Investing in stocks is one of many options for investing your money.  It comes with risk.  Open an account with a brokerage firm.  Diversify your investment.  Consider an appropriate mix of stocks to invest.  You gain income from dividends paid by the companies.
  27. 27. Stock Exchange and Economy
  28. 28. Stock Exchanges  They provide trading facilities to investors through stock brokers.  The securities traded on stock exchange include shares issued by companies, derivatives, debentures, bonds, etc. - Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) are major stock exchanges of India.  Stock exchanges help companies raise money to expand.
  29. 29. Benefits to the Economy  Stock exchanges play a vital role in functioning of the economy by providing the backbone to a nation’s economic infrastructure.  They work as first level regulator for securities market.  They allow any person to invest in any companies (greatest or smallest).  They provide order and regulation to the process of stock trading.  They provide companies with the facility to raise capital for expansion through sale of shares to public.  Helps mobilize savings from households and redirect it to firms to promote business activity.  Stock exchanges act as a barometer of the economy.
  30. 30. Goods and Services Tax (GST)  Meaning GST is one indirect tax for the whole nation, which will make India one unified common market. GST is single tax on the supply of goods and services, right from the manufacturer to the consumer. Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes GST essentially a tax only on value addition at each stage. The final consumer will thus bear only the GST charged by the last dealer in the supply chain, with set- off benefits at all the previous stages.
  31. 31.  GST would replace the following taxes currently levied and collected by the Centre:  Central Excise Duty  Duties of Excise (Medicinal and Toilet Preparations)  Additional Duties of Excise (Goods of Special Importance)  Additional Duties of Excise (Textile and Textile Products)  Additional Duties of Customs( commonly known as CVD)  Special Additional Duty of Customs (SAD)  Service Tax  Cesses and surcharges insofar as they relate to supply of goods or services.
  32. 32.  State taxes that would be subsumed within the GST are:  State VAT  Central Sales Tax  Purchase Tax  Luxury Tax  Entry Tax (All forms)  Entertainment Tax (except those levied by the local bodies)  Taxes on advertisements  Taxes on lotteries, betting and gambling  State cesses and surcharges insofar as they relate to supply of goods or services.
  33. 33. Trading and DEMAT Account
  34. 34. DEMAT Account  To trade in stocks, one needs a trading and DEMAT account.  One needs to understand the concepts related to trading and DEMAT account before opening one.  It gives one convenience to buy and sell shares from the comfort of his home/office.  It allows the investors to retain shares purchased in electronic form.
  35. 35. DEMAT account facts  You can open multiple demat accounts.  There are no account opening charges.  Can have nil balance.
  36. 36. SEBI Grievance Redressal
  37. 37. SEBI Grievance Redressal System  SEBI has developed a centralized web based system for lodging and tracking investor complaints is known as SCORES (SEBI Complaint Redress System).  SCORES can accept complaint against any market intermediary that is registered with SEBI.  The entity or intermediary needs to send an action taken report in SCORES within a reasonable period not more than 30 days.  The stock exchanges are supposed to resolve disputes at their end within 15 days.
  38. 38. Pension  Pension is the regular income of the individual after retirement.  A Defined Benefit Pension plan is one in which a specified monthly benefit (payment) is available on retirement.  A Defined Contribution Pension plan is one in which the pension amount is dependent upon the aggregated retirement corpus which in turn is determined by the amount of individual contribution.
  39. 39. Pension (cont.)  Pension Fund Regulatory and Development Authority was established by Government of India on 10 October 2003.  The Atal Bima Yojana is primarily focussed on all citizens in the unorganized sector, administered by PFRDA.  All citizens of age 18 to 40 can open account under National Pension System (NPS).
  40. 40. Thank You Email : ncfe@nism.ac.in Call : 022 6673 5100-05 Like : facebook.com/ncfeindia Follow : twitter.com/ncfeindia Share : youtube.com/ncfeindia