subject: Credit Card Processing Forward to Credit Card Processing Progress [print this page] Credit Card Processing Forward to Credit Card Processing Progress
In France, during seventeenth and eighteenth centuries a merchant banker (le merchand Banquer) was not merely a trader but an entrepreneur par excellence. Money changers concentrated on the manual change of different currencies operated locally and later accepted deposits for security reasons. Among all these institutions, it was only banks that accepted deposits from public. Merchant banks initially included acceptance houses, discount houses and issue houses. A merchant banker was primarily a merchant rather than a banker but he was entrusted with funds by his customers. The confusion has arisen because modern merchant banks have a wide range of activities.
British banks set up divisions or subsidiaries to offer their customers merchant banking services. Economic development requires specialist financial skills: savings banks to marshal individual savings; finance companies for consumer lending and mortgage finance; insurance companies for life and property cover; agricultural banks for rural development; and a range of specialized government or government sponsored institutions. A public equity or debt issue was the logical source of funds. SEBI envisages a mandatory role for merchant banks in exercising due diligence apart from issue management, in buy-backs and public offer in takeover bids. The division took up the task of assisting new entrepreneurs and existing units in the evaluation of new projects and raising funds through borrowing and issue of equity. Consequent to the recommendations of Banking Commission in 1972, that Indian banks should start merchant banking services as part of their multiple services they could offer their clients, State Bank of India started the Merchant Banking Division in 1972.
European countries have universal banking system which accept deposits, make loans, underwrite securities, engage in brokerage activities and offer financial services.
Only merchant bankers registered with Securities and Exchange Board of India can undertake issue management and underwriting, arrange mergers and offer portfolio services. A variety of businesses will work with credit card processing providers in order to process credit card transactions with various merchant account companies providing these merchant services.
Merrill Lynch provides real estate financing and investment advisory services. Before the underwriting process is completed the issuer and the investment bank have to comply with the Securities Act, 1933 dealing with new or primary issue of securities, a companion legislative piece to the Securities and Exchange Act, 1934. Under the Act the issuer has to file a registration statement with SEC prior to the sale and a red herring or preliminary prospectus to the issue.
