Consumer Finance

It is personal or domestic finance which a persons needs to live his life

Consumer finance is met by personal income and by loan.

If the personal needs are met by loans the following sources and types of consumer finance are available.

1. Charge Account
2. Hire-Purchase / Installment Sales
3. Cash Loans
4. Real Estate Loans
5. Credit Card

Bonds and Debentures

Companies need funds in addition to capital ( owner's equity). To finance this additional requirement they have to borrow from public they issue bonds or debentures. The bond is an obligation imposed by a contract or promise. It is an interest bearing certificate issued by a government or business redeemable on a specified data. The reason for issuing bonds is to arrange a long-term finance in large amounts which is single or a few banks or lenders cannot supply. The amount of a loan is divided into small units known as bonds. this small division facilitates the investor to buy them. Each bond is long term interest carrying certificate.For the debtor company it is bond payable shown on the long term liability side of the balance sheet. For the creditor it is bond receivable.

Term Life Insurance

Under it life is insured for a limited or definite period say, 7 years, 10 years, 20 years and so on. If the insured dies during the period insured the amount of the policy will be paid to his heir or heirs immediately and no premium will have to be paid any more even if he dies right after paying the first premium. If he survives the whole period the policy will determined at the end of the specified period. The main advantage of this type of policy is its low premium.

Insurance and Its Importance

Risks start birth and continue till death. Humans all over their lives face a variety of risks including accident, death, fire, theft, disease, conflict, wars and so on. A single person cannot deal with them all alone, what he can do is shift the risk to a specialized group which can bear the shifted risk at a fee. This shifting of the risk is referred to as insurance, the group assuming or bearing the risk is an insurance company, the person shifting the risk is called the insured, and the fee collected is known as premium.
The basis of insurance lies on law of averages and law of large numbers. According to these laws, thousands or large number of the insured cannot meet disaster or incur damages at a time, only a very few can.As such the amount of premium collected from thousands of the insured is far much larger than amount paid to a few for the insured damages or disaster.
The insurance business involves two parties.

1. The Insurer
2.  The Insured

The agreement between the insured and the insurer about the shifting the risk by the former and the acceptance by the letter is called as insurance and for this agreement the insurer receives premium in lump-sum or in installments. In case of loss the insurer pays up the insured amount. 

Publicity

According to the Stanton, Publicity is a non personal form of demand stimulation and is not paid for by the person or organization beneficing from it.
It takes form of news, feature, or editorial in the mass media about the product or company, For this no fee or money is paid.
It is a plug which is some times more effective than advertising. The plug refers to a piece of favorable publicity, especially one included in other material as speech, story, drama serial, feature or news.
Publicity uses many channels or routes to reach the public.
Firstly, mass communication media is used for news items, articles announcements, and the like. Mass media includes TV, newspapers, journals, magazines etc.

Documentation

Documentation involves preparation and use of documentary evidence, It is the collecting, abstracting, and coding of written records or information for future reference and use.
Documentation includes preparation of accounts, maintaining journals and ledgers, filling letters and memos, and preserving files.
All business must keep in record all necessary papers and documents relating to sales, purchases, accounting customer complaints personnel, imports, exports, company assets, debs liabilities, cash and correspondence.

Shares

In a Joint Stock Company capital is obtained in the from of shares. The capital of a company is divided into its small units, which are known as Shares. These shares are put for sale to the general public, and the proceeds shares are referred to as shareholders.
Suppose a company wants to invest 100 Million Rupees as capital in the business. The amount may be divided into 10 million units , which become shares and their face price is set at Rs10 Each. These shares will offered for subscription of the public. The received amount against these shares will become capital.