Finance is that branch or field of commerce that deals with arranging funds and assets over a period. Finance also means the management of money. One is the most important element of finance is the time value of money, which is nothing but the purchasing power of a unit varying with time. Finance is further divided into three categories:
• Personal Finance
• Corporate Finance
• Public Finance
Personal finance deals with finance for protection against some unforeseen personal events. It also includes finance for the hierarchy of the family. Personal finance shows the credit standing of a person. So, if you are looking to buy a moped on finance, so certainly you can get mopeds on financeat easy rate of interest. A person who wants to make purchases of vehicles, lands, and other assets should have a strong financial capacity. Personal finance includes arranging finance or investing and accumulating larger things in life. It is suggested that you should check on different finance companies to grab the best deal of moped finance. Different types of personal finance include
• Vehicle finance: It is also known as moped financewhich is required to purchase a moped; it can be via bank loans or maybe via self-accumulated funds
• Property finance: Finance required purchasing a property like a land or house is called property finance
• Finance to meet unforeseen events and retirement planning: This is that part of finance which includes saving and investing money for emergencies and later age of life.
Corporate finance deals with financing and funding the capital structure of business organizations. It involves balancing risks and the profitability. Corporate financing includes terms like:
• Capital budgeting: It deals with calculating the time of return of capital investment and follows various techniques like Payback period, internal rate of return, etc
• Working capital management: This deals with managing the finance of the day to day working capital requirement.
Public finance deals with the finance needed to run the country and the government. The Central Bank of a country is involved in arranging the funds to run the nation. It has elements of taxation which is the source of revenue for the government and public expenditures like defense expenditure, infrastructure expenditure, etc.
Financial services are those services which are provided by the finance industry. These include banks, credit unions, finance companies, investment fund companies, government finance companies, etc. Banks are the biggest finance service providers, and they provide services like
• Depositing money: you can deposit your money in banks in different types of accounts
• Lending money: banks provides loans for various purposes like personal or professional
• Issuing debit and credit cards
• Money transfer: you can transfer money from one person to the other or one account to the other.
• Selling investment products like mutual funds
• Lending funds to big and small business houses and providing loans to ancillary industries.
These are just the main services which banks provide; there are 100s of other important services as well.