Merchant banking is a specialised service offered by merchant banks to its clients while taking into account their financial needs, in exchange for a reasonable payment in the form of a charge. Banks known as merchant banks provide multinational firms with loan services, financial guidance, and fundraising. These banks are professionals in working with big businesses and industries since they are experts in international trade. The country’s large corporate units and multinational corporations are given money by merchant banking, which contributes to strengthening the nation’s economy. The services offered by merchant banks are only available to large enterprises and corporate entities, not to the ordinary people. An individual who assists in the subscription of securities is known as a merchant banker. The merchant banker has many duties, including managing public offerings of securities, providing international financial advising services, stock brokering and managing private placements of securities.

Functions of Merchant Bank:

Portfolio Management

• To help investors make investment decisions, merchant banking offers investment advice. By trading securities on the investors’ behalf, the merchant bank assists the investors in managing their portfolios.

Raising funds for clients

• By purchasing securities, merchant banks help clients raise money on the domestic and global markets.

Promotional activities

• In its early phases, the merchant bank also aids in the development of the business institute. It assists the organisation in working on their company plan and obtaining government permission.

Loan Syndication

• Merchant banks offer their clients this service in order to obtain credit from banks and other financial organisations.

Leasing Services

• Leasing services are another thing that merchant banks offer to their clients.