Course Contents

Introduction to Money: Evolution of Money, the Concepts of Money, Functions, Importance and Role of Money, The Distinction between Money and Credit, Money as an Asset, Concept of near money, Economic disadvantages of Money, Principles and methods of Note Issue, Introduction of barter system. Value of Money: Quantity theory of money, assumptions, criticism. Money Market and Capital Market: Introduction, Functions, segments, instruments, distinction between money and capital market. Foreign Exchange: Introduction, Determination of exchange rate, factors, exchange rate system, kinds, instruments, objective, and methods of foreign exchange. Introduction to Banking: Origin and evolution of commercial Banking, Concept and its Functions, Types of Banks. Bank Accounts Central Bank: Origin, Objectives, and Functions of central Bank, difference of commercial and central bank, state Bank of Pakistan roles and function. Credit Creation: Process, Limitations, of Credit Creation and the factors in Credit analysis. Letter of Credits: Kinds, Advantages, Procedures, Discrepancies, and Important Terms of Letter Of Credit, Problems faced by Pakistani Exporters. Principles of Lending: Forms of Lending, Cash Finance, Overdraft Loans, Bridge and Participation Loans. Purchase and Discounting of Bills. Securities for Advances: Classification of Securities; Banker’s Lien, Pledge, Hypothecation, Guarantees, Indemnity.Theories of Islamic Finance: Musharka, Mudarba, Ijara, Istisna, Bai-Salam, Murabah, Muswama E- Banking: Introduction, Perspectives and products of E- Banking, Issues and Future of E- Banking. Prudential Regulations: Limit on Banks’ exposure to a single person, Limit on Banks’ exposure against contingent liabilities, Payment of dividend, prudential regulation related to Asset Management, Guarantee, Facilities to Private Company and Customer due diligence.

Course Synopsis

Overview of basic concepts of money and its value, credit and financial institutions, use of currency and its implications in an advanced society, role of money in the market with special attention to current developments in the banking industry, Credit Creation, Letter of Credit and E-Banking.

Course Learning Outcomes

By the end of this course students will be able to: • Understand the role of money, banks and other forms of financial intermediation, • Recognize the affects that commercial banking institutions on the community, the economy, and the individual. • Differentiate between various banking products and services (i.e. loans, investments). Identify the function of the Central Bank in the Country. • Learn about differentiation of modern tools used in E- Banking.