Meaning of Financial Services and Categorization of Financial Institutions
These are services being rendered by financial institutions such as Banks, Insurance Companies, Finance Houses, Pension Funds, Stock dealers and brokers, etc.
Financial institutions most especially banks are economic growth and vision units established for providing financial services to their target markets with the main objective of making adequate retunes or profits on the funds invested and being socially responsible to society.
Categorization of Financial Institutions
Financial institutions can be broadly classified into two: Bank or bank financial institutions in the banking sector, and non-bank financial institutions.
Central Bank, Commercial Merchant or Microfinance Banks, and Development banks are institutions in the banking sector while building societies, Hire-purchase companies, insurance companies, pension funds, investment, and unit trusts and finance Houses are non-bank financial institutions.
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For overall cooperate objectives of prosperity, growth, and continued life of a business, financial institutions need to consciously structure their services in a way that caters to the financial needs of not only their present customers but also the prospective ones.
It is in the long-term interest of the banks to increase customer confidence. Thus, the need for this makes marketing increasingly important and necessary in today’s financial competitive environment to pay great attention to relevant marketing techniques.
Marketing financial services could be defined as an act of creating awareness for service products and making the same available at affordable prices to potential buyers. The financial services being discussed are those offered by the banks.
The Oligopolistic Nature of Financial Institutions
The financial industry is typically oligopolistic a special characteristic of this market is that it is of the perfect type in which homogeneous financial products are being sold by the various financial institutions to the customers.
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Under this circumstance, it is the quality of the service for sale and other non-price factors that would determine whether a customer prefers one financial institution to another whilthaware that t the financial institutions’ nature of business is the same.
This implies that our financial institutions should be creative and responsive to their market needs to tailor their financial products to the customers‟ specific needs.
Marketing came into Nigerian banks for instance after the mid-80s informing of the application he marketing concepts but in form of advertising and promotional concepts.
During this period, banks and other financial institutions were experiencing increased competition among each other.
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