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When I started off my career, I obviously had no credit history and not much knowledge of financial products. Starting my first job with Citi, one of the biggest financial services company in the world, certainly helped in quickly coming up the learning curve but (alas!) only in terms of (lending) financial products.

Start Early

One thing that takes a back seat among many young professionals – embracing financial prudence in terms of starting to save early, eluded me too. As it happens with many, in the younger years, one tends to spend more than the monthly earnings and savings are usually negligible. There is also a tendency to spend lavishly on dining out, buying fancy new clothes, going on short outstation trips, spending lavishly on foreign tips and buying unnecessary household goods. The salary, for most, except folks from the Indian Ivy league like IITs and IIMs, is modest on an average. However, most of us in our younger years go through a cycle of spending splurge on items that were on the wish list since we were students. It’s almost like a very thirsty person wandering on a barren desert suddenly coming across an oasis only to find out later that the oasis had coke instead of water and was available on a drink-now-pay-later model!

By the time, most of us realise this folly and quench our artificial thirst, many years just go down the line, and we find our self just paying an unnecessary debt in terms of credit card liabilities and cash loans taken to clear high-interest card liabilities. In another few years, it is time to get married, which happens practically early on in India and then we take more debt to ‘settle’ properly with better housing, furnishing and a car.

Reaping the benefits of compounding

On the contrary, a very minuscule population, who for some reason have financial wisdom engraved in their DNA, start saving very early on, especially in equity through SIPs; these folks become retirement ready by the age of 45 as against 90% of us who will slog it out like the regular salaried population for many more years to come. You see, they take advantage of the enormous power of compounding.

For example: Let’s consider today’s Sensex closing growth % as against June 2009 (approx. 10 years). The Sensex in the same period has grown by ~172%. Around Rs 24,000 per year or Rs 2,40,000 invested over 10 years would have become approximately Rs 11.74 lakhs on a compounding basis (17% YoY growth) by 2019. That’s approximately 5X growth. That’s the power of compounding! If one keeps investing a regular amount every year and reinvesting the interest earned, your investments grow multiple times in 10-15 years’ time horizon.

Finserv MARKETS offer a variety of digital lending products which have become a preferred destination for all kind of customers due to its quick disbursal, flexible repayment options, hassle-free and seamless online application process. Finserv MARKETS provide customers with 500+ financial and lifestyle products to choose from such as Personals Loans, Business Loans, Loan against Property, Professional Loan, Car Loan etc. It provides a fast online paperless service experience through its digital channel. Finserv MARKETS is a one-stop destination for all the financial needs of an individual and provides a unique digital experience to the customer.

Start now, so that you’ll be off to long vacations in your semi-retired state in your late forties while some of your old colleagues would be still burning the midnight oil. Hope you want to be the former and not the latter!

You might have come across the novel profession of a data scientist in your professional/student life. In a world where data is the new oil and currency, it is not surprising that the profession of a data scientist has caught everyone’s attention.

So then, who is a data scientist (DS)?  Is this profession just a fad of the digital world or does this profession carry some weight?

A combination of traits that exist in mathematicians, computer scientists and trend-spotters, Data Scientists are a new breed of professionals that juggle between IT and business. They are data analysts who use technical skills to bring solutions to complex problems.

Let’s have a look at the traits that a Data Scientist should possess and certain biases you should be cognizant about. This would be helpful if you are already a self-proclaimed data scientist or are considering going down that road or even if you are just inquisitive about the work of a DS.

If you have noticed, I have used the word trait (and not skill). While most use these two terms interchangeably, it isn’t really accurate. While there does exist a relationship between the two, perhaps even some overlap, but the core concepts are different.

Data Scientist
Skills	Traits
1. Is Task-Oriented 2. Is Experienced Based 3. Is a Continuous Process	1. Is Character Oriented 2. Are integral to a person 3. Is Relatively Constant

A data scientist has to be good with both words and numbers. When we come across, say a news story, it seems more authentic when there are numbers and figures involved. But emotions are only evoked through the story. Data Scientists are in a way, constantly digging for such stories that can explain various functions, across a variety of fields, from management to psychology to population.

Here are a few more traits of a Data Scientist –

1. Has a feeling for numbers
2. Likes to experiment
3. Is inquisitive
4. Is a responder and not a reactor
5. Is a storyteller

Let’s look at each of these traits in detail:

Feeling for Numbers	Likes to Experiment	Inquisitive	Responder	Story Teller
Aggregates and breaks down numbers   Always looks for actionable insights   Statistics (Extremely critical for Modelling)	Open to learning new tools and techniques   Tools: SQL, SAS, R, Python, SSPS, Excel, Big Data Tools, Excel   Techniques: Hypothesis Testing, Correlation, Pareto, Linear Regression, Logistic Regression, Clustering Methods…the list can go on.     Has the ability to choose the weapon of choice strategically for the problem at hand.	The person who always starts with the WHY?   Why are we undertaking this analysis?   Why are we making this change?   Has an extremely   disposition	Doesn’t break down under pressure   Believes in facts (not opinions)   Analyses the numbers before passing any inferences   Backs up their statements with data (As Deming said, ‘In God, we trust, all others must bring Data’)   Doesn’t feel the need to win every battle, but definitely has the vision to win the war.	This trait is NOT merely an icing on the cake. This trait completes a DS.   The ability to draw people to the problem statement in a prosaic yet indulgent manner   To be a good storyteller, one also needs to be inspired. My guess is that a reader generally has a higher chance of being a good storyteller!

Armoured with this understanding, I would like to sign off with one of Deming’s classic maxims, “Without data you are just another person with an opinion”

Finserv MARKETS offer a variety of digital lending products which have become a preferred destination for all kind of customers due to its quick disbursal, flexible repayment options, hassle-free and seamless online application process. Finserv MARKETS provide customers with 500+ financial and lifestyle products to choose from such as Personals Loans, Business Loans, Loan against Property, Professional Loan, Car Loan etc. It provides a fast online paperless service experience through its digital channel. Finserv MARKETS is a one-stop destination for all the financial needs of an individual and provides a unique digital experience to the customer.

With the development of Fintech apps, the financial services industry is going through major innovative changes. The advancements in financial technology have provided us with ATMs (Automated Teller Machine) and swipe machines to online and mobile banking, mobile wallets, and automated bill payments applications. There are Finance apps that help you manage your finances and stick to your monthly budget. This will help you in making better financial decisions for future savings and investments.

Let’s have a look at some of the best and major financial services; which are reshaping due to Fintech applications.

1. Application/software for billing and payments

Before fintech, the credit card companies, banks, and financial giants had complete control over the payment & transactions. But the introduction of digital payments and online billing applications have changed the game completely. Digital payments have converted the traditional cash-based operations into the cashless ones which are comparatively more convenient and accessible.

The two major sectors for digital payments and billing solutions are as follows:

2. B2B payments

Security, accuracy, and flexibility has been a huge challenge to B2B payments and crosses border transactions; there are technological solutions that assist businesses in achieving secured money transactions and payments. Some of these tech platforms include-

• Customized & private Block chain with the most security & transparency.
• E-invoice platforms for faster payments, approvals, and processing.
• Payment management platforms that offer a wide variety of payment methods or wallets.
• Mobile B2B platforms for faster digital payments and enhanced data management.

3. Digital Banks

Banking service applications have made it easier for consumers to perform banking activities online. Innovations like AI (Artificial Intelligence), biometrics, voice and face recognition, online banking improves customer engagement. Acknowledging the digital mode, online banking is extremely cost-effective as it attracts a cost of having physical premises and delivers convenience to its customers. Since this branchless concept is different from other types of banking, it significantly reduces the cost.

4. Mobile banking apps

Many industries have started to venture into digital modes/ platforms for their services, the financial sector has entered the mobile banking phase too. Nowadays, everyone prefers to get banking services from the comfort of their home. Technology has made it easier to carry out online transfer money anytime and anywhere. Mobile banking applications offer all banking operations at your fingertips with secure logins and complete access to your financial data.

5. Money remittance/ Money transfer

Many companies allow its users to transfer money to more than 100 countries and the receivers can get the amount via bank deposit, cash picks up counters, mobile money or at times even delivery. Money remittance/transfer solutions make the whole money transfer process less time consuming, less expensive and in fact, it does not even ask for actually sending funds abroad. This is where P2P comes to the rescue. P2P is one of the best and developing Fintech trends to invest in. This platform links the digital wallet of individuals both the sender and the receiver. P2P lending apps use machine learning to understand and spot borrowers who do not deserve loans based on their CIBIL Score.

6. Personal Finance Apps

Personal finance management apps have made it easier to manage your finances. With finance apps you can make a quick bill payment, shared expenses, managing subscriptions amount, debt payoffs or any other wealth management functions; PFM applications all at your fingertips. Personal finance apps allow its users to pull all of the personal money accounts together and lists personal finances in form of data visualization, categorization, and your overall spending habits.

Though with more technology in use there is a need for enhanced security precautions. But in the end, it is safe to say that Investment in the Fintech sector is going to reap good results in the future. There are numerous companies providing finance apps. One such application is the Finserv MARKETS app. You can avail personalized choices for Loans, Cards, Insurance, investments & UPI Payments along with No Cost EMIs. Also, making it easier for you to send & request money from friends and pay merchants and all your phone & electricity bills online.

Read more about Loan Apps for Contactless Personal Loan

“Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition–Offers You Value. A value proposition that ensures you get offers which are tailor made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we work towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App”.

In the face of fiscal adversities, every decision steers you closer to financial freedom or debt. The intensity of such situations might trigger natural responses like fight or flight. Or, the third, lesser-known instinct, freeze. Giving into flight instinct may lead to ill-informed moves like absconding, but being a fugitive is not the way to deal with such a problem. Aside from the legal implications, it will make returning to a life of normalcy difficult.

So, what about fighting your way out? Start by assessing your current finances. There must be something in your arsenal of assets and acquisitions that could be handy. Perhaps, something in that investment portfolio? But, the market has been performing poorly of late, and panic-stricken sell-offs would only multiply your losses.

Maybe you could sell hand-me-down gold ornaments? But, these expenses are temporary, and the sale of assets could deal more damage than good. With limited options, you might have to get more creative. Here’s an out-of-the-box idea. How about taking a loan against your life insurance?

Don’t look so surprised! 

In the United States, citizens opt for loans against their life insurance policies to avail of funds. While it’s an option available in India as well, very few people are aware of it. Since these policies offer a sizeable sum insured to the surviving dependants, it could surely benefit the policyholder before their demise. And they do!  

Loan Against Insurance Policy: What Does it Entail?  

While fulfilling the basics of personal finance, purchasing life and health insurance are some checkboxes. The former ensures that your family isn’t left financially vulnerable in case of your untimely death. Life insurance provides the surviving dependants with a sum insured, which the policyholder must pay a premium for.

When a short-term financial emergency arises, you can avail a loan against your life insurance policy. However, there are certain conditions to avail such loans. And these loans are only recommended to mitigate temporary financial constraints. Every insurance provider and bank has a policy for loans against life insurance. Generally, these loans are sanctioned against unit-linked insurance plans (ULIP) and endowment plans.

Applying for a loan against life insurance policies is a great alternative to personal loans. These loans don’t secure any collateral by way of assets and are secured loans since they are tied to an active policy. The cash value of the policy acts as collateral in such cases.

But, like most things, there is no clear-cut way of opting for loans against insurance policies. Certain factors impede the benefits of such facilities.

Factors to Consider: The Pros & Cons  

Before rushing to call your insurance provider, evaluate the advantages and disadvantages of taking out such a loan. There’s a possibility that a rash decision might further complicate your financial condition. Weigh the following pros and cons to understand whether the benefits of these loans outweigh the consequence and risks involved.

The Pros

1. High Loan Value

The maximum amount borrowers can request through the loan varies among insurance companies. They usually sanction up to 80% to 90% of the surrender value. A surrender value is calculated against the total value of the policy during its termination. If the life insurance has been active for a major portion of the tenure, borrowers could receive a considerable loan amount sanctioned.

2. Lower Interest Rate  

Unlike personal loans that usually charge a hefty interest, a loan against life insurance is comparatively lower. The interest levied on such loans depends on the premiums the policyholder has already paid in the tenure. If several timely premiums have been paid, there’s a strong possibility that a low interest is applicable.

3. Quick Access to Funds

Since policyholders already have an existing relationship with the insurance provider, it’s easier to avail a loan with minimal documentation. With fewer documents requested, the process can be expedited and completed within a day. 

4. Secured with Limited Scrutiny

By availing a loan against life insurance, borrowers are pledging the policy as security for repayment of the loan. In the event of a default, the life insurance will be used as collateral. Due to the nature of the loan, borrowers can receive the amount for lesser interest. Since it’s a secured loan, it can be disbursed much sooner. 

The Cons

1. Smaller Loan Amount

Unless borrowers wait a few years after purchasing life insurance, they’re unlikely to receive a substantial loan. Contrary to some beliefs, the loan is only sanctioned against the policy’s surrender value, not the sum assured. Policyholders must wait a significant period to accumulate a sizeable surrender value. Hence, a loan against the insurance early in the tenure will not fetch substantial amount.  

2. Policy Eligibility Concerns 

These loans apply only to certain types of life insurance policies. Borrowers can only opt for loans against traditional life insurance policies, not a term plan. These traditional policies include endowment policies, money-back plans, whole life, etc. Essentially, it’s available only on guaranteed return policies.  

3. Waiting Period 

Before applying for a loan against life insurance, borrowers must verify the waiting period for such loans. While the waiting period differs between insurers, it’s typically around three years. Within that period, the lenders scrutinise the borrowers’ premium payment history to check for any defaults. Based on this data, the lenders sanction the loan as per the surrender value estimated.  

4. Defaults on Repayment

Without adequate financial planning, borrowers might fall deeper into debt while repaying the loan and managing premium payments. In case they default on a premium, the insurance policy will lapse. Moreover, a default in loan repayment would cause the borrowers to forfeit the rest of their pledged policy’s surrender value.

What’s the final verdict?

Wisely use the option of loans against life insurance policies as a last resort to fulfil short-term, urgent financial obligations. It’s a quicker means of accessing funds at a lower interest, but it comes with some risks caused by defaults and poor money management.  

Avoid letting those financial constraints push you into a corner – apply for an effortless and quick loan on Bajaj Markets today!