Business Services

Services are intangible activities or benefits that satisfy human wants but do not result in the ownership of any physical thing (e.g., Banking, Education). They are consumed at the same time they are produced.

Goods are physical, tangible objects that can be seen and touched (e.g., Pen, Car). Their ownership can be transferred from seller to buyer, and they can be stored for future use.

e-Banking (Electronic Banking) allows a customer to conduct banking transactions electronically over the internet without visiting a physical branch.
Advantages:

• 24×7 Service: Banking services are available anytime.
• Convenience: Transactions can be done from anywhere.
• Low Cost: Reduces transaction costs for both banks and customers.
• Financial Discipline: Records every transaction digitally.

• Cellular Mobile Services: Provide voice and non-voice messages, data services, and PCO services.
• Radio Paging Services: Used for transmitting tone/numeric/alphanumeric messages.
• Fixed Line Services: Fiber optic cables connected to ground networks for voice and data.
• Cable Services: Transmit media-related information within a licensed area.
• VSAT: Satellite-based service offering reliable internet to remote areas.
• DTH: Satellite-based media services received directly via small dish antennas.

• Utmost Good Faith: Both parties must disclose all material facts (e.g., health history for life insurance).
• Insurable Interest: The insured must suffer financial loss if the subject matter is damaged (e.g., owner of a factory).
• Indemnity: Compensation is only for the actual loss, not for profit.
• Proximate Cause: The nearest cause of loss is considered for liability.
• Subrogation: Rights of ownership pass to the insurer after claim settlement.
• Contribution: Multiple insurers share the loss proportionally.
• Mitigation: Insured must take steps to minimize loss (e.g., using fire extinguishers).

Warehousing refers to the systematic storage of goods to protect them from damage and ensure availability.
Functions:

• Storage: Preserves goods until demand arises.
• Price Stabilization: Adjusts supply to prevent price fluctuation.
• Consolidation: Combines small shipments into larger ones.
• Break the Bulk: Divides bulk quantity into smaller lots.
• Value Added Services: Grading, packaging, and labeling.

Services are separately identifiable, essentially intangible activities that provide satisfaction of wants and are not necessarily linked to the sale of a product or another service.
Characteristics (5 Is):

• Intangibility: Cannot be seen or touched (e.g., Doctor’s advice).
• Inconsistency: No standard product; experience differs each time (e.g., Haircut).
• Inseparability: Production and consumption happen simultaneously.
• Inventory (Less): Cannot be stored for future use (e.g., Empty seat in a flight).
• Involvement: Participation of the customer is essential.

• Acceptance of Deposits: Banks accept surplus money from the public (e.g., Savings Account, Fixed Deposit).
• Lending of Funds: Providing loans to businesses and individuals (e.g., Home Loan, Overdraft).
• Cheque Facility: Allows withdrawal and transfer of funds (e.g., Paying rent via cheque).
• Remittance of Funds: Transferring money from one place to another (e.g., NEFT, RTGS).
• Allied Services: Bill payments, locker facilities, underwriting shares.

The Indian Postal Department offers various financial and mail facilities:
Financial Facilities:

• PPF (Public Provident Fund): Long-term investment with tax benefits.
• Kisan Vikas Patra: Savings scheme for farmers.
• National Savings Certificate (NSC): Tax-saving investment instrument.
• Recurring Deposit & Savings Account: Banking facilities for rural areas.

Mail Facilities:

• Speed Post: Fast and time-bound delivery.
• Parcel Post: Sending goods across the country.
• Registered Post: Secure delivery with proof.

• Life Insurance: Protects against the risk of premature death or provides old-age income. (Risk: Certainty of death/Old age).
• Fire Insurance: Protects against loss/damage caused by accidental fire. (Risk: Property damage).
• Marine Insurance: Protects against loss during sea transit (Cargo, Hull, Freight). (Risk: Perils of the sea like collision, piracy).
• Health Insurance: Covers medical expenses incurred due to illness/accident. (Risk: Health expenses).

Warehousing services go beyond simple storage. Types of warehouses include:

• Private Warehouses: Owned by big companies for their own storage needs.
• Public Warehouses: Licensed by the government, available to the general public for a fee.
• Bonded Warehouses: Licensed by customs authorities to store imported goods until duty is paid.
• Government Warehouses: Owned by the government (e.g., FCI, CWC) for strategic storage.
• Cooperative Warehouses: Owned by cooperative societies for use by members (farmers).