Bank Regulation vis--vis Other Industries Essay

Bank Regulation vis--vis Other Industries - bear witness ExampleBanks do not offer warranty or guarantee for the security of the deposits whereas the majority of opposite firms provide either a warranty or guarantee for the soundness of their products and services and therefore engage less regulation. Banks do not offer warranty or guarantee for the security of the deposits whereas the majority of some other firms provide either a warranty or guarantee for the soundness of their products and services and therefore quest less regulation. As bank investments are not made quite often as compared to the ordinary purchase of other goods and services, the consumer gets very little time to observe and learn. Investments once made in banks seldom offer opportunities to correct the mistakes, whereas greater chances of rectification of errors exist in the firms of other goods and services. The degree of trustworthiness in the case of banks is not easily accessible as compared to the reli ability of most of the firms providing other goods and services. Comprehensive intimacy about the soundness and risk ness of the claims offered by the banks is lacking which requires additional regulation of these financial institutions as compared to most of the firms in other industries. The value net be ascertained only after a considerable period of time and not at the very moment of accepting bank proposals. This adds to the principle of imposing extra regulation over banks than nonfinancial goods and services where in most of the cases the value can be easily ascertained.