This document provides information on various financial education topics. It discusses e-commerce, safety precautions for online transactions, regulatory bodies in India like RBI and SEBI. It also covers insurance ombudsman scheme, commodity futures market, economic depression, investing in shares, IPO process, and benefits of insurance. Further, it discusses stock exchanges and their role in the economy. Finally, it summarizes goods and services tax (GST), opening a demat and trading account, SEBI grievance redressal system, and concepts related to pension.

1. Financial Education
Class X

2. Electronic Commerce
E-commerce

3. E Commerce
 It is a type of business model, or a segment
of a larger business model, that enables a
firm or individual to do business over an
electronic network, typically the internet.
 It is a step ahead of mail-order purchasing
through a catalogue.
 It offers a wide variety of products and
services. For example, clothes, books,
financial services to train/plane tickets.
 It is a more convenient method of shopping
in terms of time and efforts.
 One can pay through debit/credit card or
through cash on delivery.

4. Beware!!
e-commerce

5. Things to be taken care of while using
e-Commerce
You need to take certain safety precautions
while transacting online.
 All you need to be careful about is:
- Credit card borrowing limit.
- Spams (unsolicited bulk business emails)
- Availability of data pertaining to business on
the online shopping website (street address,
phone number of the company).
- Privacy policy
- Lock icon on the status bar
- Select websites starting with “https:”
- Keep records regarding all your online
transactions.
- Verify claims and be aware of False claims

6. Advisory
 For ATM:
- Watch for suspicious devices on the ATM
machine to avoid data leakage.
- Number of persons in ATM room should not
be more than number of working ATM
machines.
- Don’t let anybody notice your ATM PIN.
- Seek assistance only from the security guard
in case of your card getting struck in the ATM
machine. Do not seek help from strangers.

7. Advisory
 For POS transactions using ATM/Debit card and
Internet banking:
- While transacting at merchant establishment
(POS), keep eyes on the person swiping the
card and always enter the PIN yourself.
- Avoid using public computers like Cyber café
for any e-commerce transactions/internet
banking.
- Make sure that your PC has latest antivirus,
anti-malware, personal firewall etc.

8. Advisory (cont.)
- Never respond to any email asking for your
account credentials (PIN, expiry date, card
number, etc.) or phishing mails about lottery.
- Erase the CVV number on the backside of the
card and memorize it or store it
confidentially.
- Avoid using phone devices unless the device
is secure.

9. Financial Regulatory Bodies in India
 The apex monetary and banking
institution in India. India’s central
bank.
 An autonomous statutory body that
protects investor’s interest in the
securities market, promotes
development of, and regulates
securities and commodities markets.
 A statutory body that regulates and
develops insurance sector in India.
 A statutory body that regulates the
pension sector in India.
 Reserve Bank of India
Estab. April 1, 1935
 Securities and
Exchange Board of
India
Estab.1988 | SEBI Act
1992
 Insurance Regulatory
and Development
Authority of India
Estab. 1999
 Pension Fund
Regulatory and
Development
Authority
Estab. August 23, 2003

10. New initiatives for the Policyholder
Demand Side
 The Integrated Grievance
Management System
(IGMS) offers an online
system to register the
complaints of the
policyholder through
IRDAI call centre.
 Helps to track the status
of the complaint on real
time basis.
 Call Centre educates the
policyholders on available
grievance redressal
mechanism.
 The regulator has
launched an exclusive
consumer education
website
www.policyholder.gov.in
Supply Side
 Insurers have developed innovative
insurance policies.
 Internet purchase of policy saves
the client from paying any
commission to the traditional agent.
 The internet has made the service
easily accessible.
 People working at the back-end
office, call centre are trained to
provide correct information.
 The processes have become
customer friendly due to the speed
and accuracy of service delivery.
 Promotion through web aggregators
and SMS technology.
 Insurance policies can be stored in
electronic form (e-Policies).

11. Insurance
Ombudsman

12. The Scheme
 The Insurance Ombudsman scheme was
created by Government of India for individual
policyholders to have their complaints settled
out of the courts system.
 Complaints are settled in a cost-effective,
efficient and impartial way.
 There are 12 Ombudsman Centres, covering
the country.
 One can approach the insurance Ombudsman
if-
i. Insurance company does not resolve the
complaint after approaching them.
ii. The complaint is not resolved to the
satisfaction of policyholder.
iii. the insurer has not at responded to it for
30 days.

13. Commodity Futures
Market

14. Market
A place where forces of
demand (buyer) and
supply (seller) operate
or interact (directly or
through intermediaries)
to trade goods, services
or contracts or
instruments, for money.
Spot
Market
Forward
Market
Ready
Delivery
Contract
Forward
Contract
Segments of
Commodities
Markets

15. Forward Contract
 Forward contract is a derivative contract.
 A derivative contract is an enforceable
agreement whose value is derived from the
value of an underlying asset.
 The underlying asset can be a commodity,
currency, bond, stock, or, indices of
commodities, stocks etc.

16. Futures or Hedge Contracts
 Futures contract is one type of forward
contract and are highly standardized.
 They are traded on recognized Commodity
Exchanges.
 They are generally used for protecting
against risk of adverse price fluctuation.
 Participants in commodity futures markets
are Hedgers, Speculators and Arbitrageurs.

17. Economic Depression

18. Economic Depression
 The economic recession means general
decline in economic activity.
 It is a part of business cycle.
 The recession is generally characterized by:
- Decline in GDP
- Decline in Industrial Output
- Higher Unemployment
- Decline in people’s spending

19. Investing in Shares

20. Basic Concepts
 Equity
 Face value of a share
 Market Value
 Premium
 Dividend
 Net worth of the company
 The original value of
stock.
 Current value at which
each stock trades.
 Difference between
market value and face
value.
 The share of profit
received in proportion of
one’s shareholding.

21. Initial Public Offering (IPO)
 It is the initial offering of securities to the public.
 SEBI registered merchant banker are responsible
for selling the securities to the public.
 They also investigate the company’s business and
verify the financial information given to the
investors.
 The company must file a registration statement
with the SEBI.
 There is an offer document issued to the public to
help them determine if they want to purchase the
stock on offer.
 IPO’s final price is determined on the basis of all
the bid prices.
 Allotment of shares is made on full or pro-rata
basis after its price is determine.

22. Benefits of Insurance

23. Benefits to Individual and Society
 Insurance is an arrangement by which a
person can plan for continuation of income
for self, family or business, under
uncertainty, old age or death.
 It is related to protection of human life and
assets.
 For society, it is an arrangement where many
would contributes to mitigate losses of a few.
 Greater longevity is achieved through-
o improving living standards,
o increasing productivity, and
o making quality healthcare accessible.

24. Benefits to Economy
 Life insurance contracts are long term
contracts.
 Investors become the principal source of
capital for the economy by investing their
funds.
 Non-life insurance provides cover to trade
and industry against losses due to
uncertainties.
 Government gets the capital investment
needed to finance physical and social
infrastructure through insurance.

25. Learning to Trade

26. Things to know before investing in stocks
 Investing in stocks is one of many options for
investing your money.
 It comes with risk.
 Open an account with a brokerage firm.
 Diversify your investment.
 Consider an appropriate mix of stocks to
invest.
 You gain income from dividends paid by the
companies.

27. Stock Exchange and
Economy

28. Stock Exchanges
 They provide trading facilities to investors
through stock brokers.
 The securities traded on stock exchange
include shares issued by companies,
derivatives, debentures, bonds, etc.
- Bombay Stock Exchange (BSE) and National
Stock Exchange (NSE) are major stock
exchanges of India.
 Stock exchanges help companies raise money
to expand.

29. Benefits to the Economy
 Stock exchanges play a vital role in functioning of
the economy by providing the backbone to a
nation’s economic infrastructure.
 They work as first level regulator for securities
market.
 They allow any person to invest in any companies
(greatest or smallest).
 They provide order and regulation to the process of
stock trading.
 They provide companies with the facility to raise
capital for expansion through sale of shares to
public.
 Helps mobilize savings from households and
redirect it to firms to promote business activity.
 Stock exchanges act as a barometer of the
economy.

30. Goods and Services Tax (GST)
 Meaning
GST is one indirect tax for the whole nation,
which will make India one unified common
market. GST is single tax on the supply of goods
and services, right from the manufacturer to the
consumer.
Credits of input taxes paid at each stage will be
available in the subsequent stage of value
addition, which makes GST essentially a tax
only on value addition at each stage. The final
consumer will thus bear only the GST charged
by the last dealer in the supply chain, with set-
off benefits at all the previous stages.

31.  GST would replace the following taxes
currently levied and collected by the Centre:
 Central Excise Duty
 Duties of Excise (Medicinal and Toilet
Preparations)
 Additional Duties of Excise (Goods of Special
Importance)
 Additional Duties of Excise (Textile and
Textile Products)
 Additional Duties of Customs( commonly
known as CVD)
 Special Additional Duty of Customs (SAD)
 Service Tax
 Cesses and surcharges insofar as they relate
to supply of goods or services.

32.  State taxes that would be subsumed within
the GST are:
 State VAT
 Central Sales Tax
 Purchase Tax
 Luxury Tax
 Entry Tax (All forms)
 Entertainment Tax (except those levied by
the local bodies)
 Taxes on advertisements
 Taxes on lotteries, betting and gambling
 State cesses and surcharges insofar as they
relate to supply of goods or services.

33. Trading and DEMAT
Account

34. DEMAT Account
 To trade in stocks, one needs a trading and
DEMAT account.
 One needs to understand the concepts
related to trading and DEMAT account before
opening one.
 It gives one convenience to buy and sell
shares from the comfort of his home/office.
 It allows the investors to retain shares
purchased in electronic form.

35. DEMAT account facts
 You can open multiple demat accounts.
 There are no account opening charges.
 Can have nil balance.

36. SEBI Grievance
Redressal

37. SEBI Grievance Redressal System
 SEBI has developed a centralized web based
system for lodging and tracking investor
complaints is known as SCORES (SEBI
Complaint Redress System).
 SCORES can accept complaint against any
market intermediary that is registered with
SEBI.
 The entity or intermediary needs to send an
action taken report in SCORES within a
reasonable period not more than 30 days.
 The stock exchanges are supposed to resolve
disputes at their end within 15 days.

38. Pension
 Pension is the regular income of the
individual after retirement.
 A Defined Benefit Pension plan is one in
which a specified monthly benefit (payment)
is available on retirement.
 A Defined Contribution Pension plan is one in
which the pension amount is dependent upon
the aggregated retirement corpus which in
turn is determined by the amount of
individual contribution.

39. Pension (cont.)
 Pension Fund Regulatory and Development
Authority was established by Government of
India on 10 October 2003.
 The Atal Bima Yojana is primarily focussed on
all citizens in the unorganized sector,
administered by PFRDA.
 All citizens of age 18 to 40 can open account
under National Pension System (NPS).

40. Thank You
Email : ncfe@nism.ac.in
Call : 022 6673 5100-05
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