SlideShare ist ein Scribd-Unternehmen logo
1 von 44
Downloaden Sie, um offline zu lesen
NON-BANK FINANCIAL
INTERMEDIARIES
CHAPTER 5

snurazani/DIS12
INTRODUCTION
• The key players within this segment of the financial system are pension
and provident funds, insurance companies and development financial
institutions.
• Non-bank financial intermediaries (NBFIs) can be broadly classified into
five groups of institutions, namely:
–
–
–
–
–

Development Financial Intermediaries
Saving Institutions
Employees Provident And Pension Funds,
Insurance Companies (Including Takaful),
Other Financial Intermediaries
• Factoring Companies
• Leasing companies
• Unit trusts
• Cagamas
• Credit Institutions,
• Credit Assurance Companies

snurazani/DIS12
snurazani/DIS12
• The main objectives of development financial institutions
(DFIs) are to promote development programs in specific
economic sectors such as agriculture, industry, international
trade, small medium industries, with specific institutions set
up accordingly.
• DFIs generally specialize in the provision of medium and long
term financing of projects that may carry higher credit or
market risk.
• It is predicted that in the next decade, DFIs will continue to
progress and assume a more significant role in pursuing the
Government policy goals for strategic, social and economic
development.
snurazani/DIS12
1. Provide a range of loan products, from short-term to longterm financing in the form of term loans, guarantees,
revolving credit and contract financing among others.
2. Acting as issuing house for public share issues, and the
provision of guarantees for loans
3. Help in the identification of new projects, participate in their
promotion, and where appropriate
4. Provide supplementary financial, technical and managerial
advice.
5. Provide technical assistance and help provide a platform for
networking and promotion for their clients.
* Note: The development finance institutions
snurazani/DIS12
complement those of other financial institutions
• Specialize in medium and long-term financing as well as supply of
financial services not normally provided by the commercial banks
and finance companies.
• Commercial banks traditionally focus their business on only shortterm lending to finance working capital. Their medium to long-term
loans, wherever given, are generally extended to larger and more
established enterprises with high credit standing.
• Further, commercial banks are not equipped with the expertise to
appraise projects involving complex industrial and agricultural
technology.
• To overcome the gap in the supply of financial services, and as a
part of a development strategy, the government has established
specialized DFIs.
snurazani/DIS12
Bank Pembangunan & Infrastruktur Malaysia Berhad
• The main activity to be the premier financial institution in providing financial facilities to
Bumiputeras in the manufacturing sector, services-related industries in the manufacturing sector
and also financing the country’s main infrastructure projects.

Malaysian Industrial Development Finance (MIDF)
• MIDF was set up in 1960 and is a semi-government institution providing medium and longterm loans to manufacturing industries in Malaysia.
• promotes the development of the industrial sector in Malaysia through the provision of
financing for manufacturing-based and services-based small and medium enterprises.
• The division’s financing products which are generally for the medium-to-long term, include
project, machinery, factory mortgage and working capital term loans; industrial higher
purchase and leasing facilities to finance acquisition of machinery and equipment as well as
revolving credit and factoring facilities for working capital purposes.

* Note: The development finance institutions
snurazani/DIS12
complement those of other financial institutions
•
•
•
•
•
•
•
•
•

Malaysian Industrial Development Finance (MIDF)
Bank Pembangunan & Infrastruktur Malaysia Berhad
formely known as Bank Pembangunan Malaysia
Bank Industri Malaysia Berhad
Bank Pertanian Malaysia formely known as Agro
Bank
EXIM Bank
SME Bank
Borneo Development Corporation
Sabah Development Bank
Sabah Credit Corporation
snurazani/DIS12
snurazani/DIS12
• SIs are also complement the commercial
banks and finance companies as the major
deposit-taking institutions.
• It promote and mobilize savings, especially
among the middle and lower-income groups
in the rural areas not adequately served by
the commercial banks and finance companies

snurazani/DIS12
• Examples:
– Bank Simpanan Nasional
– Bank Rakyat
– Tabung Haji

snurazani/DIS12
Saving
Institutions

Co-operative
Societies

National Saving
Bank (BSN)

Urban Credit Cooperatives
of which:
- Deposit-taking cooperatives
- Other urban credit
co- operatives

snurazani/DIS12

Rural Co-operatives
of which:
- Farmers
organizations
- Agro-based cooperatives societies
- Bank Rakyat
• Tabung Haji or Lembaga Tabung Haji is the
Malaysian Pilgrim Management and Fund Board. It was
formerly known as Lembaga Urusan dan Tabung Haji (LUTH).
• The main function of Tabung Haji is to administer and
entirely manage of Malaysian to go for Hajj.
• Tabung Haji also will facilitates savings for the pilgrimage to go
to Makkah through investment in Shariah-compliant vehicles.
• Since the investment return is considerably good, some of
Malaysian use it as an investment vehicles. Depositors are
also allow withdraw part of their EPF saving to be deposit into
their Tabung Haji account.

snurazani/DIS12
snurazani/DIS12
• PPFs are a group of financial schemes
designed to provide members and their
dependents with a measure of social security
in the form of retirement, medical, death or
disability benefits.
• The major PPFs comprise the Employees
Provident Fund (EPF) and other approved
private and pension funds
snurazani/DIS12
•The PPFs serve as important mobilizer of longterm savings in the economy for rechanneling
into both the public and private sectors to
finance long-term investment

snurazani/DIS12
• Several forms of provident and pension funds
operate in Malaysia, such as health and medical
schemes, compulsory workmen compensation
insurance, public provident and pension funds
as well as private provident and pension
schemes.

snurazani/DIS12
•
•
•
•
•
•

Employees Provident Fund (EPF),
Social Security Organisation (SOCSO),
Armed Forces Fund,
Pensions Trust Fund
Teachers Provident Fund
Other approved private provident and pension
funds.

snurazani/DIS12
• 23 per cent in Employees Provident Fund
contributions from employers (12 per cent) and
employees (11 per cent)

snurazani/DIS12
snurazani/DIS12
•Insurance business is a financial service whereby policy holders are
given financial protection against loss of property, income or life, for
a premium.

•Insurance companies have to spread their risks over the insured
community and take calculated risks to be able to cover for possible
claims
•The insurance companies comprise general and life insurance
businesses as well as professional reinsurers and insurance
intermediaries, such as insurance brokers and adjustors.
•In addition, the Takaful industry or Islamic insurance has also been
established to operate alongside conventional insurance businesses
snurazani/DIS12
•
•
•
•

Life insurance,
General insurance,
Reinsurance,
Insurance Intermediaries

snurazani/DIS12
FACTORING COMPANIES

snurazani/DIS12
FACTORING COMPANIES
• Factoring’s flexibility and effectiveness as a financing instrument is
increasingly accepted by the Malaysian business community at large
and is seen as an alternative to traditional banking facilities.
– A simple financing tool which can be applied as long as there is a creation of
debt.
– An alternative source of financing as well as an improved means of working
capital management.
• Today, there are less than 30 factoring companies in Malaysia and almost all of
them are owned by financial institutions. The factoring market can be segmented
into 2 main sectors, namely :1. The private sector (mainly the SMI market, factoring traditional market)
2. The public sector (government and government owned companies)

snurazani/DIS12
FACTORING COMPANIES
• Factoring is simply a sales and purchase transaction between
a factor (the factoring company) and its client.
• The factor would not only purchase its client’s trade
receivables but gain ownership of the debt as well, thus
allowing the factor to collect payments from the client’s
customers.
• DEBT COLLECTION AGENCY

snurazani/DIS12
FACTORING COMPANIES
• The factor gains ownership of its client’s trade debts and thus
becomes the new owner of the said debts.
• The client’s customers would then become the debtors of the
factor and these debtors would be required to pay the factor
directly to discharge their debts.

snurazani/DIS12
FACTORING COMPANIES
– By selling goods or services on credit, a
businessman will basically encounter 3 problems,
which are :• Working capital substantially locked up in trade
receivables.
• A sales ledger has to be maintained so that there is an
accurate record of debts owed by each customer.
• Customers have to be followed-up and monitored to
ensure collections are made on due dates.

snurazani/DIS12
FACTORING COMPANIES
• How its benefits the users?
– Allows a growing company meet its improving sales demand
– Enable the client to obtain cash and quantity discounts from
suppliers as well as eliminating expensive prompt payment
discounts to customers by still selling to them on credit.
– The client would be released of many administrative burdens as
well as enjoy significant savings in personnel, equipments,
stationeries, postage and telecommunication expenses, among
others due to day-to-day running of the sales ledger, credit
management and collection of outstanding book debts.
– All this add up to better profitability for the company.

snurazani/DIS12
FACTORING COMPANIES
• More than 200,000 businesses are currently using
factoring to settle trade transactions with some ten
million customers worldwide.
• All these companies are obtaining the benefits of
factoring i.e. consistent cash flow, lower
administration costs, reduced credit risks, more time
for core activities.
• These advantages are especially important for the
small and medium-sized businesses.
snurazani/DIS12
FACTORING COMPANIES
• This flexible method of managing trade debts
enables companies to obtain cash for their domestic
and international accounts receivables by selling
them to a ‘factor’.
• There are now more than 700 factoring companies
many of which offer international or cross-border
factoring services as well as domestic. Most are
separately incorporated companies, often owned by
well-known international banks and other major
financial or industrial organizations.
snurazani/DIS12
snurazani/DIS12
•
•
•
•
•

Leasing is a process by which a firm can obtain the use of a certain fixed assets for
which it must pay a series of contractual, periodic, tax deductible payments.
The lessee is the receiver of the services or the assets under the lease contract and
the lessor is the owner of the assets.
The relationship between the tenant and the landlord is called a tenancy, and can
be for a fixed or an indefinite period of time (called the term of the lease).
The consideration for the lease is called rent.
Leasing is defined as a written contract entered into between a leasing company
(called "the Lessor") on the one part and the User of the equipment (called "the
Lessee") on the other part whereby the Lessee agrees to pay the Lessor a
specified sum of rentals over an obligatory period of time in consideration for the
use of capital equipment owned by the Lessor without the Lessee having to
purchase or own the equipment.

snurazani/DIS12
Advantages
For businesses, leasing property may have significant financial benefits:
• Leasing is less capital-intensive than purchasing, so if a business has constraints on
its capital, it can grow more rapidly by leasing property than it could by purchasing
the property outright.
• Capital assets may fluctuate in value. Leasing shifts risks to the lessor, but if the
property market has shown steady growth over time, a business that depends on
leased property is sacrificing capital gains.
• Leasing may provide more flexibility to a business which expects to grow or move
in the relatively short term, because a lessee is not usually obliged to renew a
lease at the end of its term.
• In some cases a lease may be the only practical option; such as for a small business
that wishes to locate in a large office building within tight locational parameters.
• Depreciation of capital assets has different tax and financial reporting treatment
from ordinary business expenses. Lease payments are considered expenses, which
can be set off against revenue when calculating taxable profit at the end of the
relevant tax accounting period.
snurazani/DIS12
Disadvantages
For businesses, leasing property may have significant drawbacks:
• A net lease may shift some or all of the maintenance costs onto the tenant.
• If circumstances dictate that a business must change its operations significantly, it
may be expensive or otherwise difficult to terminate a lease before the end of the
term. In some cases, a business may be able to sublet property no longer required,
but this may not recoup the costs of the original lease, and, in any event, usually
requires the consent of the original lessor. Tactical legal considerations usually
make it expedient for lessees to default on their leases. The loss of book value is
small and any litigation can usually be settled on advantageous terms. This is an
improvement on the position for those companies owning their own property.
Although it can be easier for a business to sell property if it has the time, forced
sales frequently realise lower prices and can seriously affect book value.
• If the business is successful, lessors may demand higher rental payments when
leases come up for renewal. If the value of the business is tied to the use of that
particular property, the lessor has a significant advantage over the lessee in
negotiations.
snurazani/DIS12
Why choose leasing?
• As an additional source of equipment financing, leasing allows conversation of
working capital that can then be channeled to other productive business uses.
•

Lease rentals are tax deductible.

•

Fixed rental payments assist in budgeting and ease cash flow.

• Unlike an overdraft or revolving credit facility, a lease in non-cancelable once it has
been executed.

• Hedges against inflation as rental payments are fixed and made out of future
earnings.
•

Simplified documentation.

•

Lease period can be tailored to match the practical useful life of the equipment.

•

Up to 100% financing for qualified applicant.
snurazani/DIS12
What equipment can be leased?
Virtually any movable asset can be leased. However, for easy reference the main items
of equipment for leasing are categorized as follows:•
•
•
•
•
•
•
•

Computers and IT-related
Office Equipment
Industrial and Manufacturing Equipment
Commercial and Private Vehicles
Construction and Heavy Equipment
Medical Equipment
Material Handling Equipment
Others - garage equipment, photography equipment etc.

snurazani/DIS12
Leasing VS Hire Purchase??
The lessor is the owner of leased equipment and the lessee rents the
equipment to use by paying the lessor a fixed monthly rental. Ownership
stays with the lessor.
In hire purchase, the hirer services installment payment for and is the
beneficial owner of the equipment financed. Title to the equipment will
pass to the hirer once installment payment is concluded.
Example:
ORIX Leasing Malaysia Berhad

snurazani/DIS12
• Cagamas Berhad, the National Mortgage Corporation and leading
securitisation house, was established in 1986 to promote the secondary
mortgage market in Malaysia.
• Cagamas Berhad has, through the years, evolved and diversified its
business model from that of a national mortgage corporation seeking to
aid Malaysians with affordable housing, to becoming a leader in
securitisation.
• It issues debt securities to finance the purchase of housing loans and
other consumer receivables from financial institutions and non-financial
institutions.
• The provision of liquidity at a reasonable cost to the primary lenders of
housing loans encourages further financing of houses at an affordable
cost.

snurazani/DIS12
• The Cagamas Berhad model is well regarded by the World Bank as the
most successful secondary mortgage liquidity facility.
• Cagamas Berhad is the leading issuer of debt instruments, second only to
the Government of Malaysia, the largest issuer of AAA debt securities as
well as one of the top Sukuk issuers in the world.
• Cagamas Berhad’s debt securities continue to be assigned the highest
ratings of AAA and P1 by RAM Rating Services Berhad and AAA/AAAID and
MARC-1/MARC-1ID by Malaysian Rating Corporation Berhad, denoting its
strong credit quality.
• Website: http://www.cagamas.com.my/

snurazani/DIS12
• To promote home ownership among Malaysians, and to overcome the
difficulty faced by young adults to own a house, the Government has
intorduced Skim Rumah Pertamaku through Cagamas Berhad which will
provide a guarantee on down payment of 10% for houses below
RM220,000.
• The scheme is for first-time house buyers with monthly household income
of less than RM3,000. It is aimed at young adults who have just joined the
workforce.

snurazani/DIS12
• Unit Trust is a collective investment scheme that pools the savings of a large
number of investors. The money collected is invested by the fund manager in
different types of stocks, bonds, or other securities in various proportions
depending upon the objective of the fund.
• The income earned through these investments and the capital appreciation
realized by the scheme, after deducting the trading costs and expenses of
managing and administering the fund are paid out to the unit holders in
proportion to the number of units owned by them.
• Most of the unit trust funds in Malaysia are open-ended funds (the fund sells as
many units as you and other investors want to buy and buys as many units you
want to sell).
• This makes unit trust funds very liquid investments – though the price at which
you sell may be less than your purchase price if the value of the fund has
dropped.

snurazani/DIS12
• You can make an initial investment with as little as RM1,000 and
buy additional units when you have more money or invest a fixed
amount on a regular monthly schedule via a bank account.
• Thus unit trust is the most suitable investment for the common
man as it offers an opportunity to invest in a diversified,
professionally managed portfolio.
• Example:

– Public Mutual Fund
– Ammutual
– Amanah Saham BSN
– Alliances Investment Management
snurazani/DIS12
• The Credit Guarantee Corporation Malaysia Berhad was
incorporated on July 5, 1972 with the main objective of
assisting small enterprises to have ready access to credit
from the commercial banks.
• The Corporation, which is jointly owned by the Central Bank
and the commercial banks, Iaunched its credit guarantee
scheme on January 2, 1973 to provide guarantee cover to the
commercial banks for designated loans extended to small
scale enterprises in the agricultural, commercial and
industrial sectors of the economy.

snurazani/DIS12
• This guarantee cover operates automatically once credit
facilities under the scheme are provided by the commercial
banks and can be invoked as and when the loans extended
become nonrecoverable.
• Under the scheme, the commercial banks are required to pay
the Corporation a guarantee fee of 0.5 per cent per annum
on the loans outstanding.
• ln return, the Corporation covers 60 per cent of the amount
of loans in default. The maximum limits on credit made
available under the scheme is $200,000 for loans to the
bumiputera community and S100,000 to other borrowers,
while the maximum rate of interest chargeable on such loans
is 8.5 per cent per annum.
snurazani/DIS12

Weitere ähnliche Inhalte

Was ist angesagt?

Takaful and Re-Takaful Explained
Takaful and Re-Takaful ExplainedTakaful and Re-Takaful Explained
Takaful and Re-Takaful ExplainedCamille Silla Paldi
 
Practices of financing in if is
Practices of financing in if isPractices of financing in if is
Practices of financing in if isan nur
 
Chapter 5 Islamic Equities Market
Chapter 5   Islamic Equities MarketChapter 5   Islamic Equities Market
Chapter 5 Islamic Equities MarketMahyuddin Khalid
 
Bay al inah and tawarruq
Bay al inah and tawarruqBay al inah and tawarruq
Bay al inah and tawarruqHafizah Samanal
 
Asset Backed v Asset Based Sukuk
Asset Backed v Asset Based Sukuk Asset Backed v Asset Based Sukuk
Asset Backed v Asset Based Sukuk Camille Silla Paldi
 
Development of the Malaysian Islamic Financial System
Development of the Malaysian Islamic Financial SystemDevelopment of the Malaysian Islamic Financial System
Development of the Malaysian Islamic Financial SystemMahyuddin Khalid
 
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)ROLE OF SYARIAH ADVISORY COUNCIL (SAC)
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)ASMAH CHE WAN
 
Contract of Wadiah and its Application in Islamic Banking
Contract of Wadiah and its Application in Islamic BankingContract of Wadiah and its Application in Islamic Banking
Contract of Wadiah and its Application in Islamic BankingNabil Bello
 
Jurisdiction of the Court Over Islamic Banking Disputes
Jurisdiction of the Court Over Islamic Banking DisputesJurisdiction of the Court Over Islamic Banking Disputes
Jurisdiction of the Court Over Islamic Banking DisputesMahyuddin Khalid
 
Majlis penasihat syariah
Majlis penasihat syariah Majlis penasihat syariah
Majlis penasihat syariah Tinta Pena
 
Chapter 2 Shariah Stock Screening
Chapter 2   Shariah Stock ScreeningChapter 2   Shariah Stock Screening
Chapter 2 Shariah Stock ScreeningMahyuddin Khalid
 

Was ist angesagt? (20)

Takaful and Re-Takaful Explained
Takaful and Re-Takaful ExplainedTakaful and Re-Takaful Explained
Takaful and Re-Takaful Explained
 
AL-WAKALAH
AL-WAKALAHAL-WAKALAH
AL-WAKALAH
 
Muqasah
MuqasahMuqasah
Muqasah
 
Practices of financing in if is
Practices of financing in if isPractices of financing in if is
Practices of financing in if is
 
MURABAHAH
MURABAHAHMURABAHAH
MURABAHAH
 
Chapter 5 Islamic Equities Market
Chapter 5   Islamic Equities MarketChapter 5   Islamic Equities Market
Chapter 5 Islamic Equities Market
 
Bay al inah and tawarruq
Bay al inah and tawarruqBay al inah and tawarruq
Bay al inah and tawarruq
 
Asset Backed v Asset Based Sukuk
Asset Backed v Asset Based Sukuk Asset Backed v Asset Based Sukuk
Asset Backed v Asset Based Sukuk
 
Tawarruq: Islamic Personal Financing
Tawarruq: Islamic Personal FinancingTawarruq: Islamic Personal Financing
Tawarruq: Islamic Personal Financing
 
Development of the Malaysian Islamic Financial System
Development of the Malaysian Islamic Financial SystemDevelopment of the Malaysian Islamic Financial System
Development of the Malaysian Islamic Financial System
 
BAY' AL-SALAM
BAY' AL-SALAMBAY' AL-SALAM
BAY' AL-SALAM
 
AL-IJARAH
AL-IJARAHAL-IJARAH
AL-IJARAH
 
SUKUK (MUSHARAKAH)
SUKUK (MUSHARAKAH)SUKUK (MUSHARAKAH)
SUKUK (MUSHARAKAH)
 
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)ROLE OF SYARIAH ADVISORY COUNCIL (SAC)
ROLE OF SYARIAH ADVISORY COUNCIL (SAC)
 
BAY' BITHAMAN AAJIL
BAY' BITHAMAN AAJILBAY' BITHAMAN AAJIL
BAY' BITHAMAN AAJIL
 
Contract of Wadiah and its Application in Islamic Banking
Contract of Wadiah and its Application in Islamic BankingContract of Wadiah and its Application in Islamic Banking
Contract of Wadiah and its Application in Islamic Banking
 
Jurisdiction of the Court Over Islamic Banking Disputes
Jurisdiction of the Court Over Islamic Banking DisputesJurisdiction of the Court Over Islamic Banking Disputes
Jurisdiction of the Court Over Islamic Banking Disputes
 
Majlis penasihat syariah
Majlis penasihat syariah Majlis penasihat syariah
Majlis penasihat syariah
 
CONTRACT OF SALE (Al-Bay')
CONTRACT OF SALE (Al-Bay')CONTRACT OF SALE (Al-Bay')
CONTRACT OF SALE (Al-Bay')
 
Chapter 2 Shariah Stock Screening
Chapter 2   Shariah Stock ScreeningChapter 2   Shariah Stock Screening
Chapter 2 Shariah Stock Screening
 

Andere mochten auch

Non banking financial institutions
Non banking financial institutionsNon banking financial institutions
Non banking financial institutionsVinit Khushalani
 
Non Banking Financial Institutions
Non Banking Financial InstitutionsNon Banking Financial Institutions
Non Banking Financial InstitutionsAugustin Bangalore
 
non banking financial institution
non banking financial institutionnon banking financial institution
non banking financial institutionnaveen saini
 
Non-banking Finance Company(NBFCs)
Non-banking Finance Company(NBFCs)Non-banking Finance Company(NBFCs)
Non-banking Finance Company(NBFCs)Mickey
 
Banking & non banking financial institutions
Banking & non banking financial institutionsBanking & non banking financial institutions
Banking & non banking financial institutionssanah08
 
Sebi and regulations
Sebi and regulationsSebi and regulations
Sebi and regulationsvishnu1204
 
The chit funds act
The chit funds actThe chit funds act
The chit funds actLeo Lukose
 
PPT on Nidhi Company CS Waseem Anwar
PPT on Nidhi Company  CS Waseem AnwarPPT on Nidhi Company  CS Waseem Anwar
PPT on Nidhi Company CS Waseem AnwarWaseem Anwar
 
Nidhi company full form, nidhi chit fund company, nidhi company management, d...
Nidhi company full form, nidhi chit fund company, nidhi company management, d...Nidhi company full form, nidhi chit fund company, nidhi company management, d...
Nidhi company full form, nidhi chit fund company, nidhi company management, d...Ravi Pseo
 
project on chit fund
project on chit fundproject on chit fund
project on chit fundka12mal
 
All About Nidhi Company
All About Nidhi CompanyAll About Nidhi Company
All About Nidhi CompanyINDIA CS
 
Non bank financial institutions
Non bank financial institutionsNon bank financial institutions
Non bank financial institutionsDaud Dahir
 
Nidhi company rules 2014 an analysis w.r.t. nidhi company registration
Nidhi company rules 2014  an analysis w.r.t. nidhi company registrationNidhi company rules 2014  an analysis w.r.t. nidhi company registration
Nidhi company rules 2014 an analysis w.r.t. nidhi company registrationEquiCorp Associates
 
Debt markets in India
Debt markets in IndiaDebt markets in India
Debt markets in Indiapriapunjabi
 
Topic 5 non bank financial intermediaries
Topic 5  non bank financial intermediariesTopic 5  non bank financial intermediaries
Topic 5 non bank financial intermediariesDaph J
 

Andere mochten auch (20)

Non banking financial institutions
Non banking financial institutionsNon banking financial institutions
Non banking financial institutions
 
Non Banking Financial Institutions
Non Banking Financial InstitutionsNon Banking Financial Institutions
Non Banking Financial Institutions
 
non banking financial institution
non banking financial institutionnon banking financial institution
non banking financial institution
 
Non-banking Finance Company(NBFCs)
Non-banking Finance Company(NBFCs)Non-banking Finance Company(NBFCs)
Non-banking Finance Company(NBFCs)
 
Banking & non banking financial institutions
Banking & non banking financial institutionsBanking & non banking financial institutions
Banking & non banking financial institutions
 
Nidhi ppt
Nidhi pptNidhi ppt
Nidhi ppt
 
Sebi and regulations
Sebi and regulationsSebi and regulations
Sebi and regulations
 
Nidhi companies
Nidhi companiesNidhi companies
Nidhi companies
 
The chit funds act
The chit funds actThe chit funds act
The chit funds act
 
PPT on Nidhi Company CS Waseem Anwar
PPT on Nidhi Company  CS Waseem AnwarPPT on Nidhi Company  CS Waseem Anwar
PPT on Nidhi Company CS Waseem Anwar
 
Nidhi company full form, nidhi chit fund company, nidhi company management, d...
Nidhi company full form, nidhi chit fund company, nidhi company management, d...Nidhi company full form, nidhi chit fund company, nidhi company management, d...
Nidhi company full form, nidhi chit fund company, nidhi company management, d...
 
Chit funds
Chit fundsChit funds
Chit funds
 
project on chit fund
project on chit fundproject on chit fund
project on chit fund
 
All About Nidhi Company
All About Nidhi CompanyAll About Nidhi Company
All About Nidhi Company
 
Chit fund ppt
Chit fund pptChit fund ppt
Chit fund ppt
 
Chitfund company
Chitfund companyChitfund company
Chitfund company
 
Non bank financial institutions
Non bank financial institutionsNon bank financial institutions
Non bank financial institutions
 
Nidhi company rules 2014 an analysis w.r.t. nidhi company registration
Nidhi company rules 2014  an analysis w.r.t. nidhi company registrationNidhi company rules 2014  an analysis w.r.t. nidhi company registration
Nidhi company rules 2014 an analysis w.r.t. nidhi company registration
 
Debt markets in India
Debt markets in IndiaDebt markets in India
Debt markets in India
 
Topic 5 non bank financial intermediaries
Topic 5  non bank financial intermediariesTopic 5  non bank financial intermediaries
Topic 5 non bank financial intermediaries
 

Ähnlich wie 5 non-bank financial intermediaries

Development of financial institutions in Nepal
Development of financial institutions in NepalDevelopment of financial institutions in Nepal
Development of financial institutions in NepalPawan Kawan
 
financial services - Finance - Bcom hons. - 1st year - 1st semester
financial services - Finance - Bcom hons. - 1st year - 1st semesterfinancial services - Finance - Bcom hons. - 1st year - 1st semester
financial services - Finance - Bcom hons. - 1st year - 1st semesterAayushi Chhabra
 
Financial institutions
Financial institutionsFinancial institutions
Financial institutionsreyvathi
 
Loans from Allahabad Bank
Loans from Allahabad BankLoans from Allahabad Bank
Loans from Allahabad Bankjoy kar
 
2013symposium_Caspian1
2013symposium_Caspian12013symposium_Caspian1
2013symposium_Caspian1ARUN_LLC
 
Commercial Banks
Commercial BanksCommercial Banks
Commercial Bankswasif ali
 
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...Danish Dhaar
 
Microfinance in srilanaka
Microfinance in srilanakaMicrofinance in srilanaka
Microfinance in srilanakaNavindu saranga
 
Financing of Current Asset
Financing of Current AssetFinancing of Current Asset
Financing of Current Assetsheetalverma38
 
Ma0044 & institutional banking
Ma0044 & institutional bankingMa0044 & institutional banking
Ma0044 & institutional bankingsmumbahelp
 
Financing SME to Fuel Faster Development
Financing SME to Fuel Faster DevelopmentFinancing SME to Fuel Faster Development
Financing SME to Fuel Faster DevelopmentKhalfan Abdallah, CIFE
 

Ähnlich wie 5 non-bank financial intermediaries (20)

Business planning unit 4
Business planning unit 4Business planning unit 4
Business planning unit 4
 
Development of financial institutions in Nepal
Development of financial institutions in NepalDevelopment of financial institutions in Nepal
Development of financial institutions in Nepal
 
development bank
development bankdevelopment bank
development bank
 
financial services - Finance - Bcom hons. - 1st year - 1st semester
financial services - Finance - Bcom hons. - 1st year - 1st semesterfinancial services - Finance - Bcom hons. - 1st year - 1st semester
financial services - Finance - Bcom hons. - 1st year - 1st semester
 
Financial institutions
Financial institutionsFinancial institutions
Financial institutions
 
Loans from Allahabad Bank
Loans from Allahabad BankLoans from Allahabad Bank
Loans from Allahabad Bank
 
FINANCIAL SERVICE INDUSTRIES
FINANCIAL SERVICE INDUSTRIESFINANCIAL SERVICE INDUSTRIES
FINANCIAL SERVICE INDUSTRIES
 
2013symposium_Caspian1
2013symposium_Caspian12013symposium_Caspian1
2013symposium_Caspian1
 
Commercial Banks
Commercial BanksCommercial Banks
Commercial Banks
 
Ma0044
Ma0044Ma0044
Ma0044
 
UNIT 3 notes.pdf
UNIT 3 notes.pdfUNIT 3 notes.pdf
UNIT 3 notes.pdf
 
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...
Credit Appraisal System IN Commercial Vehicle loans Undertaken at INDIA INFOL...
 
SHG Model.pptx
SHG Model.pptxSHG Model.pptx
SHG Model.pptx
 
Finance company
Finance companyFinance company
Finance company
 
Basix
BasixBasix
Basix
 
Microfinance in srilanaka
Microfinance in srilanakaMicrofinance in srilanaka
Microfinance in srilanaka
 
Day 3
Day   3Day   3
Day 3
 
Financing of Current Asset
Financing of Current AssetFinancing of Current Asset
Financing of Current Asset
 
Ma0044 & institutional banking
Ma0044 & institutional bankingMa0044 & institutional banking
Ma0044 & institutional banking
 
Financing SME to Fuel Faster Development
Financing SME to Fuel Faster DevelopmentFinancing SME to Fuel Faster Development
Financing SME to Fuel Faster Development
 

Mehr von Hajar Hafizah

Chap 9 -_introduction_to_takaful
Chap 9 -_introduction_to_takafulChap 9 -_introduction_to_takaful
Chap 9 -_introduction_to_takafulHajar Hafizah
 
Chap 8 -_underwriting
Chap 8 -_underwritingChap 8 -_underwriting
Chap 8 -_underwritingHajar Hafizah
 
Chap 7 -_insurance_documents
Chap 7 -_insurance_documentsChap 7 -_insurance_documents
Chap 7 -_insurance_documentsHajar Hafizah
 
Chapter 6 -_insurance_products
Chapter 6 -_insurance_productsChapter 6 -_insurance_products
Chapter 6 -_insurance_productsHajar Hafizah
 
Chap 4 -_insurance_industry (2)
Chap 4 -_insurance_industry (2)Chap 4 -_insurance_industry (2)
Chap 4 -_insurance_industry (2)Hajar Hafizah
 
Ch 6 -_benefits_compensation
Ch 6 -_benefits_compensationCh 6 -_benefits_compensation
Ch 6 -_benefits_compensationHajar Hafizah
 
Ch 5 -_performance_appraisal
Ch 5 -_performance_appraisalCh 5 -_performance_appraisal
Ch 5 -_performance_appraisalHajar Hafizah
 
Ch 5 -_human_resource_development
Ch 5 -_human_resource_developmentCh 5 -_human_resource_development
Ch 5 -_human_resource_developmentHajar Hafizah
 
Ch 3 -_recruitment_selection
Ch 3 -_recruitment_selectionCh 3 -_recruitment_selection
Ch 3 -_recruitment_selectionHajar Hafizah
 
Chapter 1 introduction_to_hrm_dis13
Chapter 1 introduction_to_hrm_dis13Chapter 1 introduction_to_hrm_dis13
Chapter 1 introduction_to_hrm_dis13Hajar Hafizah
 
Costing case study pp
Costing case study ppCosting case study pp
Costing case study ppHajar Hafizah
 
Latihan Industri Politeknik
Latihan Industri Politeknik Latihan Industri Politeknik
Latihan Industri Politeknik Hajar Hafizah
 
Pb301 business management
Pb301 business managementPb301 business management
Pb301 business managementHajar Hafizah
 

Mehr von Hajar Hafizah (20)

Chap 9 -_introduction_to_takaful
Chap 9 -_introduction_to_takafulChap 9 -_introduction_to_takaful
Chap 9 -_introduction_to_takaful
 
Chap 8 -_underwriting
Chap 8 -_underwritingChap 8 -_underwriting
Chap 8 -_underwriting
 
Chap 7 -_insurance_documents
Chap 7 -_insurance_documentsChap 7 -_insurance_documents
Chap 7 -_insurance_documents
 
Chapter 6 -_insurance_products
Chapter 6 -_insurance_productsChapter 6 -_insurance_products
Chapter 6 -_insurance_products
 
Chapter 5
Chapter 5Chapter 5
Chapter 5
 
Chap 4 -_insurance_industry (2)
Chap 4 -_insurance_industry (2)Chap 4 -_insurance_industry (2)
Chap 4 -_insurance_industry (2)
 
Chp 3
Chp 3Chp 3
Chp 3
 
Chp 2
Chp 2Chp 2
Chp 2
 
Chp 1
Chp 1Chp 1
Chp 1
 
Ch 6 -_benefits_compensation
Ch 6 -_benefits_compensationCh 6 -_benefits_compensation
Ch 6 -_benefits_compensation
 
Ch 5 -_performance_appraisal
Ch 5 -_performance_appraisalCh 5 -_performance_appraisal
Ch 5 -_performance_appraisal
 
Ch 5 -_human_resource_development
Ch 5 -_human_resource_developmentCh 5 -_human_resource_development
Ch 5 -_human_resource_development
 
Ch 3 job_analysis
Ch 3 job_analysisCh 3 job_analysis
Ch 3 job_analysis
 
Ch 3 -_recruitment_selection
Ch 3 -_recruitment_selectionCh 3 -_recruitment_selection
Ch 3 -_recruitment_selection
 
Ch 2 -_hr_planning
Ch 2 -_hr_planningCh 2 -_hr_planning
Ch 2 -_hr_planning
 
Chapter 1 introduction_to_hrm_dis13
Chapter 1 introduction_to_hrm_dis13Chapter 1 introduction_to_hrm_dis13
Chapter 1 introduction_to_hrm_dis13
 
Costing case study pp
Costing case study ppCosting case study pp
Costing case study pp
 
Bibliografi rujukan
Bibliografi  rujukanBibliografi  rujukan
Bibliografi rujukan
 
Latihan Industri Politeknik
Latihan Industri Politeknik Latihan Industri Politeknik
Latihan Industri Politeknik
 
Pb301 business management
Pb301 business managementPb301 business management
Pb301 business management
 

Kürzlich hochgeladen

LIC PRIVATISATION its a bane or boon.pptx
LIC PRIVATISATION its a bane or boon.pptxLIC PRIVATISATION its a bane or boon.pptx
LIC PRIVATISATION its a bane or boon.pptxsonamyadav7097
 
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTES
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTESACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTES
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTESKumarJayaraman3
 
Work and Pensions report into UK corporate DB funding
Work and Pensions report into UK corporate DB fundingWork and Pensions report into UK corporate DB funding
Work and Pensions report into UK corporate DB fundingHenry Tapper
 
The unequal battle of inflation and the appropriate sustainable solution | Eu...
The unequal battle of inflation and the appropriate sustainable solution | Eu...The unequal battle of inflation and the appropriate sustainable solution | Eu...
The unequal battle of inflation and the appropriate sustainable solution | Eu...Antonis Zairis
 
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdf
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdfLundin Gold March 2024 Corporate Presentation - PDAC v1.pdf
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdfAdnet Communications
 
2024.03 Strategic Resources Presentation
2024.03 Strategic Resources Presentation2024.03 Strategic Resources Presentation
2024.03 Strategic Resources PresentationAdnet Communications
 
Introduction to Entrepreneurship and Characteristics of an Entrepreneur
Introduction to Entrepreneurship and Characteristics of an EntrepreneurIntroduction to Entrepreneurship and Characteristics of an Entrepreneur
Introduction to Entrepreneurship and Characteristics of an Entrepreneurabcisahunter
 
The Power Laws of Bitcoin: How can an S-curve be a power law?
The Power Laws of Bitcoin: How can an S-curve be a power law?The Power Laws of Bitcoin: How can an S-curve be a power law?
The Power Laws of Bitcoin: How can an S-curve be a power law?Stephen Perrenod
 
CLMV-Outlook-March-2024-ENG-20240327.pdf
CLMV-Outlook-March-2024-ENG-20240327.pdfCLMV-Outlook-March-2024-ENG-20240327.pdf
CLMV-Outlook-March-2024-ENG-20240327.pdfSCBEICSCB
 
Sarlat Advisory - Corporate Brochure - 2024
Sarlat Advisory - Corporate Brochure - 2024Sarlat Advisory - Corporate Brochure - 2024
Sarlat Advisory - Corporate Brochure - 2024Guillaume Ⓥ Sarlat
 
Stock Market Brief Deck for 3/22/2024.pdf
Stock Market Brief Deck for 3/22/2024.pdfStock Market Brief Deck for 3/22/2024.pdf
Stock Market Brief Deck for 3/22/2024.pdfMichael Silva
 
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.KumarJayaraman3
 
Solution manual for Intermediate Accounting, 11th Edition by David Spiceland...
Solution manual for  Intermediate Accounting, 11th Edition by David Spiceland...Solution manual for  Intermediate Accounting, 11th Edition by David Spiceland...
Solution manual for Intermediate Accounting, 11th Edition by David Spiceland...mwangimwangi222
 
20240314 Calibre March 2024 Investor Presentation (FINAL).pdf
20240314 Calibre March 2024 Investor Presentation (FINAL).pdf20240314 Calibre March 2024 Investor Presentation (FINAL).pdf
20240314 Calibre March 2024 Investor Presentation (FINAL).pdfAdnet Communications
 
The CBR Covered Bond Investor Roundtable 2024
The CBR Covered Bond Investor Roundtable 2024The CBR Covered Bond Investor Roundtable 2024
The CBR Covered Bond Investor Roundtable 2024Neil Day
 
Stock Market Brief Deck for March 26.pdf
Stock Market Brief Deck for March 26.pdfStock Market Brief Deck for March 26.pdf
Stock Market Brief Deck for March 26.pdfMichael Silva
 

Kürzlich hochgeladen (20)

Mobile Money Taxes: Knowledge, Perceptions and Politics: The Case of Ghana
Mobile Money Taxes: Knowledge, Perceptions and Politics: The Case of GhanaMobile Money Taxes: Knowledge, Perceptions and Politics: The Case of Ghana
Mobile Money Taxes: Knowledge, Perceptions and Politics: The Case of Ghana
 
LIC PRIVATISATION its a bane or boon.pptx
LIC PRIVATISATION its a bane or boon.pptxLIC PRIVATISATION its a bane or boon.pptx
LIC PRIVATISATION its a bane or boon.pptx
 
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTES
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTESACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTES
ACCOUNTING FOR BUSINESS.II BRANCH ACCOUNTS NOTES
 
Work and Pensions report into UK corporate DB funding
Work and Pensions report into UK corporate DB fundingWork and Pensions report into UK corporate DB funding
Work and Pensions report into UK corporate DB funding
 
The unequal battle of inflation and the appropriate sustainable solution | Eu...
The unequal battle of inflation and the appropriate sustainable solution | Eu...The unequal battle of inflation and the appropriate sustainable solution | Eu...
The unequal battle of inflation and the appropriate sustainable solution | Eu...
 
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdf
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdfLundin Gold March 2024 Corporate Presentation - PDAC v1.pdf
Lundin Gold March 2024 Corporate Presentation - PDAC v1.pdf
 
Effects & Policies Of Bank Consolidation
Effects & Policies Of Bank ConsolidationEffects & Policies Of Bank Consolidation
Effects & Policies Of Bank Consolidation
 
2024.03 Strategic Resources Presentation
2024.03 Strategic Resources Presentation2024.03 Strategic Resources Presentation
2024.03 Strategic Resources Presentation
 
Introduction to Entrepreneurship and Characteristics of an Entrepreneur
Introduction to Entrepreneurship and Characteristics of an EntrepreneurIntroduction to Entrepreneurship and Characteristics of an Entrepreneur
Introduction to Entrepreneurship and Characteristics of an Entrepreneur
 
The Power Laws of Bitcoin: How can an S-curve be a power law?
The Power Laws of Bitcoin: How can an S-curve be a power law?The Power Laws of Bitcoin: How can an S-curve be a power law?
The Power Laws of Bitcoin: How can an S-curve be a power law?
 
Commercial Bank Economic Capsule - March 2024
Commercial Bank Economic Capsule - March 2024Commercial Bank Economic Capsule - March 2024
Commercial Bank Economic Capsule - March 2024
 
CLMV-Outlook-March-2024-ENG-20240327.pdf
CLMV-Outlook-March-2024-ENG-20240327.pdfCLMV-Outlook-March-2024-ENG-20240327.pdf
CLMV-Outlook-March-2024-ENG-20240327.pdf
 
Sarlat Advisory - Corporate Brochure - 2024
Sarlat Advisory - Corporate Brochure - 2024Sarlat Advisory - Corporate Brochure - 2024
Sarlat Advisory - Corporate Brochure - 2024
 
Stock Market Brief Deck for 3/22/2024.pdf
Stock Market Brief Deck for 3/22/2024.pdfStock Market Brief Deck for 3/22/2024.pdf
Stock Market Brief Deck for 3/22/2024.pdf
 
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.
ACCOUNTING FOR BUSINESS.II DEPARTMENTAL ACCOUNTS.
 
Solution manual for Intermediate Accounting, 11th Edition by David Spiceland...
Solution manual for  Intermediate Accounting, 11th Edition by David Spiceland...Solution manual for  Intermediate Accounting, 11th Edition by David Spiceland...
Solution manual for Intermediate Accounting, 11th Edition by David Spiceland...
 
20240314 Calibre March 2024 Investor Presentation (FINAL).pdf
20240314 Calibre March 2024 Investor Presentation (FINAL).pdf20240314 Calibre March 2024 Investor Presentation (FINAL).pdf
20240314 Calibre March 2024 Investor Presentation (FINAL).pdf
 
The CBR Covered Bond Investor Roundtable 2024
The CBR Covered Bond Investor Roundtable 2024The CBR Covered Bond Investor Roundtable 2024
The CBR Covered Bond Investor Roundtable 2024
 
New Monthly Enterprises Survey. Issue 21. (01.2024) Ukrainian Business in War...
New Monthly Enterprises Survey. Issue 21. (01.2024) Ukrainian Business in War...New Monthly Enterprises Survey. Issue 21. (01.2024) Ukrainian Business in War...
New Monthly Enterprises Survey. Issue 21. (01.2024) Ukrainian Business in War...
 
Stock Market Brief Deck for March 26.pdf
Stock Market Brief Deck for March 26.pdfStock Market Brief Deck for March 26.pdf
Stock Market Brief Deck for March 26.pdf
 

5 non-bank financial intermediaries

  • 2. INTRODUCTION • The key players within this segment of the financial system are pension and provident funds, insurance companies and development financial institutions. • Non-bank financial intermediaries (NBFIs) can be broadly classified into five groups of institutions, namely: – – – – – Development Financial Intermediaries Saving Institutions Employees Provident And Pension Funds, Insurance Companies (Including Takaful), Other Financial Intermediaries • Factoring Companies • Leasing companies • Unit trusts • Cagamas • Credit Institutions, • Credit Assurance Companies snurazani/DIS12
  • 4. • The main objectives of development financial institutions (DFIs) are to promote development programs in specific economic sectors such as agriculture, industry, international trade, small medium industries, with specific institutions set up accordingly. • DFIs generally specialize in the provision of medium and long term financing of projects that may carry higher credit or market risk. • It is predicted that in the next decade, DFIs will continue to progress and assume a more significant role in pursuing the Government policy goals for strategic, social and economic development. snurazani/DIS12
  • 5. 1. Provide a range of loan products, from short-term to longterm financing in the form of term loans, guarantees, revolving credit and contract financing among others. 2. Acting as issuing house for public share issues, and the provision of guarantees for loans 3. Help in the identification of new projects, participate in their promotion, and where appropriate 4. Provide supplementary financial, technical and managerial advice. 5. Provide technical assistance and help provide a platform for networking and promotion for their clients. * Note: The development finance institutions snurazani/DIS12 complement those of other financial institutions
  • 6. • Specialize in medium and long-term financing as well as supply of financial services not normally provided by the commercial banks and finance companies. • Commercial banks traditionally focus their business on only shortterm lending to finance working capital. Their medium to long-term loans, wherever given, are generally extended to larger and more established enterprises with high credit standing. • Further, commercial banks are not equipped with the expertise to appraise projects involving complex industrial and agricultural technology. • To overcome the gap in the supply of financial services, and as a part of a development strategy, the government has established specialized DFIs. snurazani/DIS12
  • 7. Bank Pembangunan & Infrastruktur Malaysia Berhad • The main activity to be the premier financial institution in providing financial facilities to Bumiputeras in the manufacturing sector, services-related industries in the manufacturing sector and also financing the country’s main infrastructure projects. Malaysian Industrial Development Finance (MIDF) • MIDF was set up in 1960 and is a semi-government institution providing medium and longterm loans to manufacturing industries in Malaysia. • promotes the development of the industrial sector in Malaysia through the provision of financing for manufacturing-based and services-based small and medium enterprises. • The division’s financing products which are generally for the medium-to-long term, include project, machinery, factory mortgage and working capital term loans; industrial higher purchase and leasing facilities to finance acquisition of machinery and equipment as well as revolving credit and factoring facilities for working capital purposes. * Note: The development finance institutions snurazani/DIS12 complement those of other financial institutions
  • 8. • • • • • • • • • Malaysian Industrial Development Finance (MIDF) Bank Pembangunan & Infrastruktur Malaysia Berhad formely known as Bank Pembangunan Malaysia Bank Industri Malaysia Berhad Bank Pertanian Malaysia formely known as Agro Bank EXIM Bank SME Bank Borneo Development Corporation Sabah Development Bank Sabah Credit Corporation snurazani/DIS12
  • 10. • SIs are also complement the commercial banks and finance companies as the major deposit-taking institutions. • It promote and mobilize savings, especially among the middle and lower-income groups in the rural areas not adequately served by the commercial banks and finance companies snurazani/DIS12
  • 11. • Examples: – Bank Simpanan Nasional – Bank Rakyat – Tabung Haji snurazani/DIS12
  • 12. Saving Institutions Co-operative Societies National Saving Bank (BSN) Urban Credit Cooperatives of which: - Deposit-taking cooperatives - Other urban credit co- operatives snurazani/DIS12 Rural Co-operatives of which: - Farmers organizations - Agro-based cooperatives societies - Bank Rakyat
  • 13. • Tabung Haji or Lembaga Tabung Haji is the Malaysian Pilgrim Management and Fund Board. It was formerly known as Lembaga Urusan dan Tabung Haji (LUTH). • The main function of Tabung Haji is to administer and entirely manage of Malaysian to go for Hajj. • Tabung Haji also will facilitates savings for the pilgrimage to go to Makkah through investment in Shariah-compliant vehicles. • Since the investment return is considerably good, some of Malaysian use it as an investment vehicles. Depositors are also allow withdraw part of their EPF saving to be deposit into their Tabung Haji account. snurazani/DIS12
  • 15. • PPFs are a group of financial schemes designed to provide members and their dependents with a measure of social security in the form of retirement, medical, death or disability benefits. • The major PPFs comprise the Employees Provident Fund (EPF) and other approved private and pension funds snurazani/DIS12
  • 16. •The PPFs serve as important mobilizer of longterm savings in the economy for rechanneling into both the public and private sectors to finance long-term investment snurazani/DIS12
  • 17. • Several forms of provident and pension funds operate in Malaysia, such as health and medical schemes, compulsory workmen compensation insurance, public provident and pension funds as well as private provident and pension schemes. snurazani/DIS12
  • 18. • • • • • • Employees Provident Fund (EPF), Social Security Organisation (SOCSO), Armed Forces Fund, Pensions Trust Fund Teachers Provident Fund Other approved private provident and pension funds. snurazani/DIS12
  • 19. • 23 per cent in Employees Provident Fund contributions from employers (12 per cent) and employees (11 per cent) snurazani/DIS12
  • 21. •Insurance business is a financial service whereby policy holders are given financial protection against loss of property, income or life, for a premium. •Insurance companies have to spread their risks over the insured community and take calculated risks to be able to cover for possible claims •The insurance companies comprise general and life insurance businesses as well as professional reinsurers and insurance intermediaries, such as insurance brokers and adjustors. •In addition, the Takaful industry or Islamic insurance has also been established to operate alongside conventional insurance businesses snurazani/DIS12
  • 24. FACTORING COMPANIES • Factoring’s flexibility and effectiveness as a financing instrument is increasingly accepted by the Malaysian business community at large and is seen as an alternative to traditional banking facilities. – A simple financing tool which can be applied as long as there is a creation of debt. – An alternative source of financing as well as an improved means of working capital management. • Today, there are less than 30 factoring companies in Malaysia and almost all of them are owned by financial institutions. The factoring market can be segmented into 2 main sectors, namely :1. The private sector (mainly the SMI market, factoring traditional market) 2. The public sector (government and government owned companies) snurazani/DIS12
  • 25. FACTORING COMPANIES • Factoring is simply a sales and purchase transaction between a factor (the factoring company) and its client. • The factor would not only purchase its client’s trade receivables but gain ownership of the debt as well, thus allowing the factor to collect payments from the client’s customers. • DEBT COLLECTION AGENCY snurazani/DIS12
  • 26. FACTORING COMPANIES • The factor gains ownership of its client’s trade debts and thus becomes the new owner of the said debts. • The client’s customers would then become the debtors of the factor and these debtors would be required to pay the factor directly to discharge their debts. snurazani/DIS12
  • 27. FACTORING COMPANIES – By selling goods or services on credit, a businessman will basically encounter 3 problems, which are :• Working capital substantially locked up in trade receivables. • A sales ledger has to be maintained so that there is an accurate record of debts owed by each customer. • Customers have to be followed-up and monitored to ensure collections are made on due dates. snurazani/DIS12
  • 28. FACTORING COMPANIES • How its benefits the users? – Allows a growing company meet its improving sales demand – Enable the client to obtain cash and quantity discounts from suppliers as well as eliminating expensive prompt payment discounts to customers by still selling to them on credit. – The client would be released of many administrative burdens as well as enjoy significant savings in personnel, equipments, stationeries, postage and telecommunication expenses, among others due to day-to-day running of the sales ledger, credit management and collection of outstanding book debts. – All this add up to better profitability for the company. snurazani/DIS12
  • 29. FACTORING COMPANIES • More than 200,000 businesses are currently using factoring to settle trade transactions with some ten million customers worldwide. • All these companies are obtaining the benefits of factoring i.e. consistent cash flow, lower administration costs, reduced credit risks, more time for core activities. • These advantages are especially important for the small and medium-sized businesses. snurazani/DIS12
  • 30. FACTORING COMPANIES • This flexible method of managing trade debts enables companies to obtain cash for their domestic and international accounts receivables by selling them to a ‘factor’. • There are now more than 700 factoring companies many of which offer international or cross-border factoring services as well as domestic. Most are separately incorporated companies, often owned by well-known international banks and other major financial or industrial organizations. snurazani/DIS12
  • 32. • • • • • Leasing is a process by which a firm can obtain the use of a certain fixed assets for which it must pay a series of contractual, periodic, tax deductible payments. The lessee is the receiver of the services or the assets under the lease contract and the lessor is the owner of the assets. The relationship between the tenant and the landlord is called a tenancy, and can be for a fixed or an indefinite period of time (called the term of the lease). The consideration for the lease is called rent. Leasing is defined as a written contract entered into between a leasing company (called "the Lessor") on the one part and the User of the equipment (called "the Lessee") on the other part whereby the Lessee agrees to pay the Lessor a specified sum of rentals over an obligatory period of time in consideration for the use of capital equipment owned by the Lessor without the Lessee having to purchase or own the equipment. snurazani/DIS12
  • 33. Advantages For businesses, leasing property may have significant financial benefits: • Leasing is less capital-intensive than purchasing, so if a business has constraints on its capital, it can grow more rapidly by leasing property than it could by purchasing the property outright. • Capital assets may fluctuate in value. Leasing shifts risks to the lessor, but if the property market has shown steady growth over time, a business that depends on leased property is sacrificing capital gains. • Leasing may provide more flexibility to a business which expects to grow or move in the relatively short term, because a lessee is not usually obliged to renew a lease at the end of its term. • In some cases a lease may be the only practical option; such as for a small business that wishes to locate in a large office building within tight locational parameters. • Depreciation of capital assets has different tax and financial reporting treatment from ordinary business expenses. Lease payments are considered expenses, which can be set off against revenue when calculating taxable profit at the end of the relevant tax accounting period. snurazani/DIS12
  • 34. Disadvantages For businesses, leasing property may have significant drawbacks: • A net lease may shift some or all of the maintenance costs onto the tenant. • If circumstances dictate that a business must change its operations significantly, it may be expensive or otherwise difficult to terminate a lease before the end of the term. In some cases, a business may be able to sublet property no longer required, but this may not recoup the costs of the original lease, and, in any event, usually requires the consent of the original lessor. Tactical legal considerations usually make it expedient for lessees to default on their leases. The loss of book value is small and any litigation can usually be settled on advantageous terms. This is an improvement on the position for those companies owning their own property. Although it can be easier for a business to sell property if it has the time, forced sales frequently realise lower prices and can seriously affect book value. • If the business is successful, lessors may demand higher rental payments when leases come up for renewal. If the value of the business is tied to the use of that particular property, the lessor has a significant advantage over the lessee in negotiations. snurazani/DIS12
  • 35. Why choose leasing? • As an additional source of equipment financing, leasing allows conversation of working capital that can then be channeled to other productive business uses. • Lease rentals are tax deductible. • Fixed rental payments assist in budgeting and ease cash flow. • Unlike an overdraft or revolving credit facility, a lease in non-cancelable once it has been executed. • Hedges against inflation as rental payments are fixed and made out of future earnings. • Simplified documentation. • Lease period can be tailored to match the practical useful life of the equipment. • Up to 100% financing for qualified applicant. snurazani/DIS12
  • 36. What equipment can be leased? Virtually any movable asset can be leased. However, for easy reference the main items of equipment for leasing are categorized as follows:• • • • • • • • Computers and IT-related Office Equipment Industrial and Manufacturing Equipment Commercial and Private Vehicles Construction and Heavy Equipment Medical Equipment Material Handling Equipment Others - garage equipment, photography equipment etc. snurazani/DIS12
  • 37. Leasing VS Hire Purchase?? The lessor is the owner of leased equipment and the lessee rents the equipment to use by paying the lessor a fixed monthly rental. Ownership stays with the lessor. In hire purchase, the hirer services installment payment for and is the beneficial owner of the equipment financed. Title to the equipment will pass to the hirer once installment payment is concluded. Example: ORIX Leasing Malaysia Berhad snurazani/DIS12
  • 38. • Cagamas Berhad, the National Mortgage Corporation and leading securitisation house, was established in 1986 to promote the secondary mortgage market in Malaysia. • Cagamas Berhad has, through the years, evolved and diversified its business model from that of a national mortgage corporation seeking to aid Malaysians with affordable housing, to becoming a leader in securitisation. • It issues debt securities to finance the purchase of housing loans and other consumer receivables from financial institutions and non-financial institutions. • The provision of liquidity at a reasonable cost to the primary lenders of housing loans encourages further financing of houses at an affordable cost. snurazani/DIS12
  • 39. • The Cagamas Berhad model is well regarded by the World Bank as the most successful secondary mortgage liquidity facility. • Cagamas Berhad is the leading issuer of debt instruments, second only to the Government of Malaysia, the largest issuer of AAA debt securities as well as one of the top Sukuk issuers in the world. • Cagamas Berhad’s debt securities continue to be assigned the highest ratings of AAA and P1 by RAM Rating Services Berhad and AAA/AAAID and MARC-1/MARC-1ID by Malaysian Rating Corporation Berhad, denoting its strong credit quality. • Website: http://www.cagamas.com.my/ snurazani/DIS12
  • 40. • To promote home ownership among Malaysians, and to overcome the difficulty faced by young adults to own a house, the Government has intorduced Skim Rumah Pertamaku through Cagamas Berhad which will provide a guarantee on down payment of 10% for houses below RM220,000. • The scheme is for first-time house buyers with monthly household income of less than RM3,000. It is aimed at young adults who have just joined the workforce. snurazani/DIS12
  • 41. • Unit Trust is a collective investment scheme that pools the savings of a large number of investors. The money collected is invested by the fund manager in different types of stocks, bonds, or other securities in various proportions depending upon the objective of the fund. • The income earned through these investments and the capital appreciation realized by the scheme, after deducting the trading costs and expenses of managing and administering the fund are paid out to the unit holders in proportion to the number of units owned by them. • Most of the unit trust funds in Malaysia are open-ended funds (the fund sells as many units as you and other investors want to buy and buys as many units you want to sell). • This makes unit trust funds very liquid investments – though the price at which you sell may be less than your purchase price if the value of the fund has dropped. snurazani/DIS12
  • 42. • You can make an initial investment with as little as RM1,000 and buy additional units when you have more money or invest a fixed amount on a regular monthly schedule via a bank account. • Thus unit trust is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed portfolio. • Example: – Public Mutual Fund – Ammutual – Amanah Saham BSN – Alliances Investment Management snurazani/DIS12
  • 43. • The Credit Guarantee Corporation Malaysia Berhad was incorporated on July 5, 1972 with the main objective of assisting small enterprises to have ready access to credit from the commercial banks. • The Corporation, which is jointly owned by the Central Bank and the commercial banks, Iaunched its credit guarantee scheme on January 2, 1973 to provide guarantee cover to the commercial banks for designated loans extended to small scale enterprises in the agricultural, commercial and industrial sectors of the economy. snurazani/DIS12
  • 44. • This guarantee cover operates automatically once credit facilities under the scheme are provided by the commercial banks and can be invoked as and when the loans extended become nonrecoverable. • Under the scheme, the commercial banks are required to pay the Corporation a guarantee fee of 0.5 per cent per annum on the loans outstanding. • ln return, the Corporation covers 60 per cent of the amount of loans in default. The maximum limits on credit made available under the scheme is $200,000 for loans to the bumiputera community and S100,000 to other borrowers, while the maximum rate of interest chargeable on such loans is 8.5 per cent per annum. snurazani/DIS12