Research Into The Functioning Behind Commercial Banking Finance Essay - Free Essay Example

Sample details Pages: 4 Words: 1199 Downloads: 3 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? The Financial services had spread all around the UAE Market, and became one of the basic elements of the UAE Economy; moreover, the UAE financial services have progressed in many fields and many international businesses seek the UAE as their destination. The banking industry has developed from one bank in Dubai to a chain of banks over the country, as to the UAE business environment that attracts businesses to it. On the other point of view in regarding of the financial services in UAE, and it is impact worldwide. Don’t waste time! Our writers will create an original "Research Into The Functioning Behind Commercial Banking Finance Essay" essay for you Create order And on the other hand, after all of the above discussion we can conclude that although there are some effects for the globalization at some barriers, modifying several formations, challenging political and economic realities and entering into a dialogue of national and religious identities, with taking the financial services into such consideration for any future modifications. It is true to say that the last century has seen more change in the financial services field than the preceding three centuries combined. Banking has been transformed from an industry comprising many small bankers offering a limited range of paper-based services to a wealthy minority, to one characterized by the growing pre-eminence of a few global players, providing a varied range of financial services. Moreover, the main functions of modern commercial banks as they exist today in our economic life comprise providing what is so called current account facilities together with issuing debit cards to its c ustomers and the same customers has to receive a statement at the end of the month summarizing all of his financial activities during the same period, money transfer services, accepting money keen on savings accounts, granting loans along with advances, besides facilitating import-export transactions, also buying as well as selling foreign currency, in addition to issuing credit cards to its valuable customers which is called cardholder and the same may use the money within his credit limit, however the same consumed amount has to be paid within a fixed period of time otherwise he will be charged for the unpaid balance amount. Banks also accept money from the public people in addition to institutions keen on savings accounts, besides keeping them safe, moreover pay interest scheduled for such money. In turn, they use this money to grant loans and advances to borrowers; however banks are charging an interest against such services. This service provides the savers with a fix income , while their capital remains unharmed. On the other side, banks provide the borrowers access to money, which they would otherwise not have without the existing of banks at our economic life. Moreover, it became as direct debit and they have to return it back in a specific time which is called loan term. However, each bank has its own way to protect its loans including by an external authority which is called payment protection insurance. On the other hand, Technology is a fundamental issue to be considered because many businesses depend on them. For the UAE technology is a vital subject because it is their passport to the other countries. Technology has progressed in the UAE in many businesses such as the banking business. Analysts comment that: acirc;â‚ ¬Ã…“Banking business is that well managed and given the size of the market. The banks have access to modern technology and all have installed good management. The banking sector is split and there are far too many banks ser vicing a small population. So far, all the banks have been fairly profitable and there have been no compulsions to merge.acirc;â‚ ¬Ãƒâ€šÃ‚  This is besides that, many banks have access to modern technology as it helps them to provide their services 24 hours a day. Firstly, development ATMs, Interactive Voice Response (IVR) units enable clients to bypass the branches and contact the bank from the remote location. After that, development Banking facilities or the online banking has allowed clients to do their daily transactions by visiting the site of the bank from their PC. Internet banking, for example, can be globally accessed from numerous locations as it depends on the site of the bank. A particular government increased its spending by borrowing; therefore the impact that this policy will have as the following: A- Interest Rates: It will go up and it will affect the other sectors of the economy especially the private sectors as there will be no more money to lend. B- Bank Loan: The banks will show more hesitation on giving loans to the commercial as well industrial firms in the same country C- Consumer Income: This will defiantly increase as by more spending of the government; the more of the consumers will spend at the same market D- Bank Deposits: This will increase as more people will have deposits at the bank, since the interest rates will be increased. As the Central Banks are playing major role in controlling as well as managing the functioning of the banks in the country, moreover, it has more tasks in keeping the stability of the country economy as well as enhancing the growth of the same economy. On the other hands, the responsibilities of the central bank can be disclosed as the following: Carry out the country fiscal policy through influencing the funds as well as credit state of affairs in the same country economy.Acirc; Oversee and standardize banking firms to guarantee security in addition to reliability of the same country banking as well as financial system. Preserve the stability as well as strength of the said country financial system. Offer confident financial services to its government, besides financial firms, in addition to the public as well as foreign official authorities, together with a major function in operating the same country payments system.Acirc; Based on best practices and learned lessons on the success or failure of studies at the financial services, there are several conclusions and recommendations that can be made: 1) The UAE as a large resource-rich developed country should adopt a careful, step-by-step approach to develop the financial services. Financial services policies and implementation strategies need to be developed within the socio-economic context and strengths and weaknesses of the country. 2) Political stability seems to be a critical consideration in financial services development. Countries in the GCC region, including UAE, have political stability and continuity of economic and industrial development policies. These countries have attracted foreign investment and recorded steady growth of their economies. 3) A modern, reliable, and cost-effective telecommunications infrastructure is essential for service industries such like financial services. It is also noteworthy for financial services. Developing a world class telecommunications infrastructure and becoming a part of the global network should be a top priority for the UAE. 4) Foreign investments are essential to get started in financial services. They have the expertise and capital; they create jobs and feeder local companies; they train staff and transfer technology; and they provide access to international markets. The UAE offers attractive incentives to national and foreign multinational financial services. 5) IT has been widely viewed as central to economic and industrial development in developed countries. The UAE Government faces the challenge of formulating and implementing financial services policies to exploit the potential of financial services for national development.