CROSS SELLING AND FINANCIAL SERVICE

Liberalisation and deregulation of the financial sector, the greater use of financial engineering techniques and models, significant advances in information technology, fast growing integration of financial services and consumer demands have all resulted in greater competition and better pricing of financial products and services. As a result, many of the financial companies especially banks have started identifying new channels to improve their non interest income by exploiting convergence in the financial industry and financial liberalisation. Banking services have started cross selling their activities into many other sectors by expanding their business to securities and insurance and other innovative areas to recover losses from their own businesses which include Bancassurance, Mutual Funds, credit card services, credit rating etc. which in simple terms would be referred as cross selling of financial services.

Examples for Cross Selling Services Adopted by State Bank

Bancassurance
State Bank of Mysore has adopted Bancassurance model and entered into tie-ups with SBI Life Insurance Company Limited for marketing and distributing life insurance products and with National Insurance Company Limited, for non-life Insurance products in order to deliver greater value to its clientele.

SBI Life:

SBI Life is a joint venture of State Bank of India and Cardif – a wholly owned subsidiary of BNP Paribas of France, the 5th largest bank in the world where, a range of life insurance, savings, critical illness cover and pension products are available. It has a wide range of the products focusing on both group and individual. The group products are hassle free and are available at the same cost among the group members. The Individual products are inexpensive and the premium depends on the various factors like age, health conditions etc. As an attempt to meet both financial and insurance needs, SBI Life has introduced Unit Plus II, which gives the benefit of Market linked returns, which in the long term gives better returns than traditional savings products. Another Product Scholar II takes care of the future of the child in the event of unfortunate death of the parent/s. Yet another product ‘Shield’ is unique, wherein the insurance cover grows year after year. SBI Life offers several other tailors made insurance products.

SBI Mutual Funds

A wholly owned subsidiary of State Bank of India, established in 1987. All of its products are distributed through SBM. There are various types of mutual fund schemes namely equity, debt and liquid fund schemes in the market to cater to investor’s needs. The equity funds of SBIMF are among the top funds in the industry in their asset class.

SBI Cards:

GE Capital Services and State Bank of India created a joint venture to address the Credit Card market: namely, SBI Cards and Payment Services Ltd. (SBICPSL) and GE Capital Business Process management Services ltd. (GECBPMSL). SBI CPCL offers various types of credit cards. All types of credit cards are sourced through designated branches of the Bank located at important centers.

SBI Capital Markets Limited

SBM guides its customers to invest in tax free Govt. of India Saving Bonds, Capital Gain Bonds, National Housing Bank Bonds, Rural Electrification Corporation Bonds, Small Industries Development Bank of India (SIDBI) Bonds etc., SBM in association with SBI Capital Markets Limited also provides advisory services for Privatization, Mergers and acquisitions to its Corporate customers, which are new emerging business opportunities.

Referral Arrangements with National Insurance Company:

SBM has entered into Referral Arrangement with National Insurance Company for marketing general insurance products through the network of branches. A mediclaim policy has been introduced for the customers of the Bank.

Dhanvanthari Bima Policy

State Bank of Mysore and National Insurance Co. Ltd have launched Dhanvanthari Bima Policy, a Health Insurance Policy, Exclusively for the account holders of State Bank of Mysore. The entire family consisting of the a/c holder, spouse and 2 dependent children (below the age of 21 years) can be covered under this policy up to the age of 80.