The Impact of Third-Party Financial Products on the Consumer Loan Services Market in the Banking Sector: An Analysis of Sales Progress and Consumer Behavior

Certain predominant Banks astride across India stayed esoterically stable while graphing nascent opportunities in retail banking sectors to intensify their financial values. And concomitantly, Money lending facilities i.e., Consumer Loan services are one of those offerings which are supposed to meet...

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Bibliographic Details
Published in:Asia-Pacific financial markets 2024-06, Vol.31 (2), p.367-387
Main Authors: Ranawat, Narendra Singh, Chakraborty, Ayon
Format: Article
Language:English
Subjects:
Banking
Banks
Consumer education
Customers
Econometrics
Economic Theory/Quantitative Economics/Mathematical Methods
Economics and Finance
Education
Finance
Insurance
Insurance policies
International Economics
Late payments
Loans
Macroeconomics/Monetary Economics//Financial Economics
Original Research
Payment systems
Policies
Retail banking
Third party
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Summary:Certain predominant Banks astride across India stayed esoterically stable while graphing nascent opportunities in retail banking sectors to intensify their financial values. And concomitantly, Money lending facilities i.e., Consumer Loan services are one of those offerings which are supposed to meet the customer’s needs and requirements. But due to a lack of proper ‘customer education’, customers are made to purchase third-party financial products like mutual funds or insurance policies as mandatory at the time of disbursement of loans by the bank officials, which results in financial losses to the customers. The study is carried out to explore various loan facilities provided by major banks so that customers can avail of the loan facilities as per their requirements. We have studied and surveyed all consumer loan services available, and on the basis of certain parameters such as Interest Rates, Equated Monthly Installment (EMI), Processing Fee, Pre- Payment Charges, Charges for Late Payments of EMI, Cheques/ Electronic Clearing Service (ECS) Return Charges, Mandate Life Insurance Policies, etc. The study concluded that customers should be exposed to all types of terms and conditions regarding third-party financial products at the time of loan disbursement so that every customer can be protected from mis-selling third-party financial products. Therefore, this study will enhance the literature towards’ customer education’ and will spread awareness of certain terms and conditions to the customer at the time of disbursement of loans in their account.
ISSN:1387-2834
1573-6946
DOI:10.1007/s10690-023-09419-6