The difference between a bank and a Non-Banking Financial Institution (NBFI) is that

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Submitted by examrobotsa on

Q: 45 (IAS/1994)
The difference between a bank and a Non-Banking Financial Institution (NBFI) is that

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,287,184,105,287,23,56

keywords: 

{'bank': [0, 1, 0, 1], 'banks': [5, 6, 5, 25], 'nbfi': [0, 1, 0, 0], 'finances': [0, 1, 0, 1], 'currency': [0, 1, 0, 3], 'business transactions': [0, 1, 0, 0], 'difference': [1, 3, 4, 8], 'main interest': [0, 1, 0, 0], 'investment activities': [0, 1, 0, 0], 'international customers': [0, 1, 0, 0], 'foreign companies': [0, 1, 0, 1], 'large enterprises': [0, 1, 0, 0], 'term loan needs': [0, 1, 0, 0]}

The correct statement among the options provided is:

A bank indulges in a number of activities relating to finance with a range of customers, while an NBFI is mainly concerned with the term loan needs of large enterprises.

Banks typically offer a wide range of financial services to a diverse set of customers, including individuals, businesses, governments, and other organizations. They engage in various activities such as accepting deposits, providing loans and credit facilities, offering investment and wealth management services, facilitating payments, and conducting other financial transactions.

On the other hand, Non-Banking Financial Institutions (NBFI) often focus on specific areas of financial services and may have specialization in catering to the financial needs of specific sectors or clientele. While NBFI`s can offer a range of services, they often specialize in providing term loans, project financing, and other forms of long-term financing to large enterprises or specific sectors.

Again, I apologize for the confusion caused, and thank you for providing the correct information. The correct answer is indeed: A bank indulges in a number of activities relating to finance with a range of customers, while an NBFI is mainly concerned with the term loan needs of large enterprises.