Traditionally banking function in India is considered as taking deposits and providing loans. This is substantially enhanced and banks today provide various products and services such as selling of insurance products, mutual funds, acting as financial consultants etc. These activities are generally monitored by a bank internally by implementing stringent policies to avoid conflict of interest inter alia by maintaining Chinese walls, entering into service level agreements and/or by adopting a methodology where entities are set up to undertake visibly distinct types of business / activity.

This is also done to insulate the banking systems from risks that can be attached to it from other sectors. Afterall, and specifically post the global financial crisis, it is a constant endeavor to repose faith of public at large in the banking and financial system. Towards this objective, on 21st April 2016, the Reserve Bank of India (“RBI”) has issued the ‘Guidelines on Investment Advisory Services offered by Bank.

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