Financial Planning Services

What is PMS?

PMS- Portfolio Management Services is used by high networth investors to invest in stocks. While there are products that also bet on fixed income instruments, most are equity-linked.

How does PMS work?

It is offered by brokerages and mutual funds registered with Sebi. There are two types of PMS: Discretionary and Non Discretionary.

In discretionary, the fund manager takes investment decisions on behalf of the investor. In non-discretionary, the fund manager takes investment decisions on behalf of the investor. In non-discretionary, the fund manager suggests investment ideas, while the decision is taken by the client.

Structure of a PMS scheme

When you opt for a PMS scheme, a bank account and demat account are separately opened in the your name and all investments are made in your name only. Accordingly, any income or dividend coming out of the investment made will also be credited to your bank account and the shares will be held in the demat account in your name.


How does an investor monitor his/her accounts?

As per the PMS agreement, the Power of Attorney for operating the bank and demat account will be with the portfolio manager.

Most portfolio managers give a username and password which can be used to login into their website and see the portfolio statements. As per Sebi’s instructions, a portfolio manager is required to furnish a performance report to their clients every 6 months.

Characteristics of Financial Services

• Financial services are intangible
Financial services are customer oriented
• The production and delivery of service are simultaneous functions
• They are perishable in nature and cannot be stored
• They are dynamic in nature as financial services vary with the changing requirements of the customer and the socioeconomic environment
• They are proactive in nature and help to visualize the expectation of the market
• They act as the link between the investor and the borrower
• They aid in the distribution of risk

Types of Financial Services

1. Capital Market Services: It consists of term lending institutions which mainly provide long term funds

2. Money Market Services: It consists of commercial banks, financial institutions, cooperative banks which provide short term funds

3. Retail Marketing Services: Services provided to individuals for direct consumption

4. Wholesale Marketing Services: Services provided to corporate institutions which may be directly or indirectly converted into retail services

Factors to Consider While Selecting a Top Financing Company

1. Views the lessee as your customer – Work with a company that gives you complete access to your customer base and doesn’t compete with you for business.
2. Provides ethical treatment at end of term – Make sure the company you work with provides notification at the end of the agreement, puts in writing the amount customers will be charged at end of term on Fair Market Value (FMV) deals. Work with someone that will help you keep your customers rather than drive them away.
3. Has a team specifically dedicated to your industry – Choose a company with knowledge and experience serving the telecom & data industry. They understand the intricacies of your business and are more likely to develop innovative solutions.
4. Offers billing solutions for your maintenance & service – Choose a partner that is able to provide bundled billing of your maintenance and service with your equipment.
5. Is flexible and willing to customize – Customized solutions based on the needs of your business will increase sales and profitability.
6. Has tools available online – Look for a partner that simplifies things for you by providing online access to applications, proposals, documentation and reporting tools.
7. Maintains high service levels – Test out their service levels of accuracy, timeliness, credit decisioning, documentation, funding and effective communication.
8. Offers value-add / complementary services – Look for a financing partner that has the skills and knowledge to offer value-add services that may benefit your business like sales training, HR consulting and best practice sharing.
9. Provides live coverage when you need them – Whether you’re East coast, West coast or somewhere in-between make sure the company you work with has knowledgeable workers staffed during your general business hours.
10. Has a proven track record for success – See how long they’ve been in business and make sure that they have consistent policies in both good and bad economic times.

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