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Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
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Kanika tandon hdfc_bank_ltd._summer_internship_project...
Kanika tandon hdfc_bank_ltd._summer_internship_project...
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Important Note: The text in this chapter is intended to clarify business-related concepts. It is not intended nor can it replace formal legal advice. Before taking any actions relating to your …

Important Note: The text in this chapter is intended to clarify business-related concepts. It is not intended nor can it replace formal legal advice. Before taking any actions relating to your business, always consult your accountant or a business law/tax attorney.

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  • 1. A PROJECT REPORT On “ANALYSIS OF HDFC LOANS IN BAREILLY “ For HDFC BANK Ltd. SUMMER TRAINING PROJECT UNDER THE GUIDANCE OFAkrash Mehrotra Dr. Sankalp Srivastava(Relationship Manager) (Assistant Director)HDFC BANK LTD., BAREILLY INSTITUTE OF PRODUCTIVITY & MANAGENMENT, Lucknow SUBMITTED IN PARTIAL FULFILLMENT FOR THE AWARD OF POST GRADUATION DIPLOMA IN MANAGEMENT BY KANIKA TANDON PGDM (F/T) L209021 INSTITUTE OF PRODUCTIVITY & MANAGEMENT LUCKNOW 1Institute of Productivity and Management
  • 2. 2009-2011 ACKNOWLEDGEMENTAt the successful completion of summer internship program, I wish to express my true regardsto individuals who supported and directed me throughout this internship.First of all I would like to give my gratitude and sincere regards and a note of thank to AkarshMehrotra (Relationship Manager, HDFC Bank Ltd., Bareilly) for giving me thisopportunity and selecting me as summer trainee in this esteemed organization.I would like to express my deep gratitude and regards for his valuable guidance and supportwithout which completion of this report would not be possible.I would also like to give special thanks to Mr. Mukul Saxena, Mrs. Shweta Arora, (HDFCBank Ltd., Bareilly) for giving me their valuable time, support and inputs that helped me atevery step in this project.I take the opportunity to acknowledge and express sincere thanks to Dr. Sankalp Srivastava(Assistant Director, IPM Lucknow) for being constant source of inspiration to me, showing allthe patience and abundant encouragement throughout the project duration.Lastly, I would like to thank all my friends for their support and help. Kanika Tandon 2Institute of Productivity and Management
  • 3. DeclarationI hereby declare that this Project Report entitled “ANALYSIS OF HDFC LOANS INBAREILLY “in HDFC BANK LTD., BAREILLY submitted in the partial fulfillment of therequirement of Post Graduate Diploma In Management (PGDM) of INSTITUTE OFPRODUCTIVITY & MANAGEMET, LUCKNOW is based on primary & secondary datafound by me in various departments, books, magazines and websites & collected by me in underguidance of Akarsh Mehrotra.DATE: KANIKATANDON PGDM (Finance) 3Institute of Productivity and Management
  • 4. SECTION A 4Institute of Productivity and Management
  • 5. List of ContentsSection A  Industry and Company Profile………………………………................2  Industry Background………………………………….. ……………...18  Competitive Situation……………………………………..….............23  Company background……………………………………...................25  Organizational Chart………………………………………………….30  Product range………………………………………………………… 31  Financial position of the company……………………………...........59Section B  The project Profile……………………………………………………….62  Why this project was undertaken/problem environment/the problem being faced…………………………………………………………………..........6 3  What does company expect to do by solving the problem? ........................64 5Institute of Productivity and Management
  • 6. Section C  The project – background and methodology……………………………….67  Research problem…………………………………………………………67  Research objective and related sub objectives……………………..............67  Information requirements – in detail and source of information…………...68  Choice of research design…………………………………………………68  Research instrument used- details. Why? ………………………….............69  Sampling techniques used and sample size. Why? ………………………..72  Field work – method used for data collection ……………………………..73  Analytical tool used………………………………………………………...74  Limitations………………………………………………………. …...........74Section D  Analysis & Interpretations …………………………….………..………76  Conclusions……………………………………………………………….10 1  Suggestions………………………………………………………………..10 2 6Institute of Productivity and Management
  • 7. • Questionnaire• Annexure• Bibliography Industry and Company Profile Industry Profile Introduction on BankOrigin of the word 7Institute of Productivity and Management
  • 8. The name bank derives from the Italian word banco "desk/bench", used during the Renaissanceby Jewish Florentine bankers, who used to make their transactions above a desk covered by agreen tablecloth. However, there are traces of banking activity even in times ancient , whichindicates that the word bank might not necessarily come from the word banco.Banks date back to ancient times. During the 3rd century AD, banks in Persia and otherterritories in the Persian Sassanid Empire issued letters of credit known as Ṣakks. Muslimtraders are known to have used the cheque or Sakks system since the time of Harun al-Rashid(9th century) of the Abbasid Caliphate. In the 9th century, a Muslim businessman could cash anearly form of the cheque in China drawn on sources in Baghdad a tradition that wassignificantly strengthened in the 13th and 14th centuries, during the Mongol Empire. Indeed,fragments found in the Cairo Geniza indicate that in the 12th century cheques remarkablysimilar to our own were in use, only smaller to save costs on the paper. They contain a sum tobe paid and then the order "May so and so pay the bearer such and such an amount". The dateand name of the issuer are also apparent. The earliest known state deposit bank, Banco di SanGiorgio (Bank of St. George), was founded in 1407 at Genoa, Italy. Banking in the modernsense of the word can be traced to medieval and early Renaissance Italy, to the rich cities in thenorth like Florence, Venice and Genoa. The Bardi and Peruzzi families were dominated bankingin 14th century Florence, establishing branches in many other parts of Europe. Perhaps the mostfamous Italian bank was the Medici bank, set up by Giovanni Medici in 1397.Meaning of bankA bank is a financial intermediary that accepts deposits and channels those deposits intolending activities. Banks are a fundamental component of the financial system, and are alsoactive players in financial markets. The essential role of a bank is to connect those who havecapital (such as investors or depositors), with those who seek capital (such as individualswanting a loan, or businesses wanting to grow). 8Institute of Productivity and Management
  • 9. Banking is generally a highly regulated industry, and government restrictions on financialactivities by banks have varied over time and location. The current set of global standards iscalled Basel II. In some countries such as Germany, banks have historically owned major stakesin industrial corporations while in other countries such as the United States banks are prohibitedfrom owning non-financial companies. In Japan, banks are usually the nexus of a cross-shareholding entity known as the keiretsu. In France, banc assurance is prevalent, as most banks offerinsurance services (and now real estate services) to their clients. The most recent trend has beenthe advance of universal banks, which attempt to offer their customers the full spectrum offinancial services under the one roof.The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in Siena, Italy,which has been operating continuously since 1472.DefinitionThe definition of a bank varies from country to country.Under English common law, a banker is defined as a person who carries on the business ofbanking, which is specified as: • conducting current accounts for his customers • paying cheques drawn on him, and • Collecting cheques for his customers.In most English common law jurisdictions there is a Bills of Exchange Act that codifies the lawin relation to negotiable instruments, including cheques, and this Act contains a statutorydefinition of the term banker: banker includes a body of persons, whether incorporated or not,who carry on the business of banking (Section 2, Interpretation). Although this definition seemscircular, it is actually functional, because it ensures that the legal basis for bank transactionssuch as cheques does not depend on how the bank is organized or regulated.The business of banking is in many English common law countries not defined by statute but bycommon law, the definition above. In other English common law jurisdictions there are 9Institute of Productivity and Management
  • 10. statutory definitions of the business of banking or banking business. When looking at thesedefinitions it is important to keep in minds that they are defining the business of banking for thepurposes of the legislation, and not necessarily in general. In particular, most of the definitionsare from legislation that has the purposes of entry regulating and supervising banks rather thanregulating the actual business of banking. However, in many cases the statutory definitionclosely mirrors the common law one. Examples of statutory definitions: • "banking business" means the business of receiving money on current or deposit account, paying and collecting cheques drawn by or paid in by customers, the making of advances to customers, and includes such other business as the Authority may prescribe for the purposes of this Act; (Banking Act (Singapore), Section 2, Interpretation). • "banking business" means the business of either or both of the following: 1. receiving from the general public money on current, deposit, savings or other similar account repayable on demand or within less than [3 months] ... or with a period of call or notice of less than that period; 2. Paying or collecting cheques drawn by or paid in by customers.Since the advent of EFTPOS (Electronic Funds Transfer at Point Of Sale), direct credit, directdebit and internet banking, the cheque has lost its primacy in most banking systems as apayment instrument. This has led legal theorists to suggest that the cheque based definitionshould be broadened to include financial institutions that conduct current accounts for customersand enable customers to pay and be paid by third parties, even if they do not pay and collectcheques.Standard activitiesBanks act as payment agents by conducting checking or current accounts for customers, payingcheques drawn by customers on the bank, and collecting cheques deposited to customerscurrent accounts. Banks also enable customer payments via other payment methods such astelegraphic transfer, EFTPOS, and ATM. 10Institute of Productivity and Management
  • 11. Banks borrow money by accepting funds deposited on current accounts, by accepting termdeposits, and by issuing debt securities such as banknotes and bonds. Banks lend money bymaking advances to customers on current accounts, by making installment loans, and byinvesting in marketable debt securities and other forms of money lending.Banks borrow most funds from households and non-financial businesses, and lend most funds tohouseholds and non-financial businesses, but non-bank lenders provide a significant and inmany cases adequate substitute for bank loans, and money market funds, cash managementtrusts and other non-bank financial institutions in many cases provide an adequate substitute tobanks for lending savings to.Wider commercial roleThe commercial role of banks is not limited to banking, and includes: • issue of banknotes (promissory notes issued by a banker and payable to bearer on demand) • processing of payments by way of telegraphic transfer, EFTPOS, internet banking or other means • issuing bank drafts and bank cheques • accepting money on term deposit • lending money by way of overdraft, installment loan or otherwise • providing documentary and standby letters of credit (trade finance), guarantees, performance bonds, securities underwriting commitments and other forms of off-balance sheet exposures • safekeeping of documents and other items in safe deposit boxes • currency exchange • acting as a financial supermarket for the sale, distribution or brokerage, with or without advice, of insurance, unit trusts and similar financial product 11Institute of Productivity and Management
  • 12. ChannelsBanks offer many different channels to access their banking and other services: • A branch, banking centre or financial centre is a retail location where a bank or financial institution offers a wide array of face-to-face service to its customers. • ATM is a computerized telecommunications device that provides a financial institutions customers a method of financial transactions in a public space without the need for a human clerk or bank teller. Most banks now have more ATMs than branches, and ATMs are providing a wider range of services to a wider range of users. For example in Hong Kong, most ATMs enable anyone to deposit cash to any customer of the banks account by feeding in the notes and entering the account number to be credited. Also, most ATMs enable card holders from other banks to get their account balance and withdraw cash, even if the card is issued by a foreign bank. • Mail is part of the postal system which itself is a system wherein written documents typically enclosed in envelopes, and also small packages containing other matter, are delivered to destinations around the world. This can be used to deposit cheques and to send orders to the bank to pay money to third parties. Banks also normally use mail to deliver periodic account statements to customers. • Telephone banking is a service provided by a financial institution which allows its customers to perform transactions over the telephone. This normally includes bill payments for bills from major billers (e.g. for electricity). • Online banking is a term used for performing transactions, payments etc. over the Internet through a bank, credit union or building societys secure website. • Mobile banking is a method of using ones mobile phone to conduct simple banking transactions by remotely linking into a banking network.Products:- 12Institute of Productivity and Management
  • 13. Retail • Savings account • Cheque account • Credit card • Home loan • Personal loan • Business loan • Insurance advisor • Mutual fundWholesale • Project finance • Capital raising (Equity / Debt / Hybrids) • Risk management (FX, interest rates, commodities)Banks in the economyEconomic functionsThe economic functions of banks include: 1. Issue of money, in the form of banknotes and current accounts subject to cheque or payment at the customers order. These claims on banks can act as money because they are negotiable and/or repayable on demand, and hence valued at par. They are effectively transferable by mere delivery, in the case of banknotes, or by drawing a cheque that the payee may bank or cash. 13Institute of Productivity and Management
  • 14. 2. Netting and settlement of payments – banks act as both collection and paying agents for customers, participating in interbank clearing and settlement systems to collect, present, be presented with, and pay payment instruments. This enables banks to economies on reserves held for settlement of payments, since inward and outward payments offset each other. It also enables the offsetting of payment flows between geographical areas, reducing the cost of settlement between them. 3. Credit intermediation – banks borrow and lend back-to-back on their own account as middle men. 4. Credit quality improvement – banks lend money to ordinary commercial and personal borrowers (ordinary credit quality), but are high quality borrowers. The improvement comes from diversification of the banks assets and capital which provides a buffer to absorb losses without defaulting on its obligations. However, banknotes and deposits are generally unsecured; if the bank gets into difficulty and pledges assets as security, to rise the funding it needs to continue to operate, this puts the note holders and depositors in an economically subordinated position. 5. Maturity transformation – banks borrow more on demand debt and short term debt, but provide more long term loans. In other words, they borrow short and lend long. With a stronger credit quality than most other borrowers, banks can do this by aggregating issues (e.g. accepting deposits and issuing banknotes) and redemptions (e.g. withdrawals and redemptions of banknotes), maintaining reserves of cash, investing in marketable securities that can be readily converted to cash if needed, and raising replacement funding as needed from various sources (e.g. wholesale cash markets and securities markets)Types of retail banks • Commercial bank: the term used for a normal bank to distinguish it from an investment bank. After the Great Depression, the U.S. Congress required that banks only engage in banking activities, whereas investment banks were limited to capital market activities. Since the two no longer have to be under separate ownership, some use the term 14Institute of Productivity and Management
  • 15. "commercial bank" to refer to a bank or a division of a bank that mostly deals with deposits and loans from corporations or large businesses. • Community banks: locally operated financial institutions that empower employees to make local decisions to serve their customers and the partners. • Community development banks: regulated banks that provide financial services and credit to under-served markets or populations. • Postal savings banks: savings banks associated with national postal systems. • Private Banks: banks that manage the assets of high net worth individuals. • Offshore banks: banks located in jurisdictions with low taxation and regulation. Many offshore banks are essentially private banks. • Savings bank: in Europe, savings banks take their roots in the 19th or sometimes even 18th century. Their original objective was to provide easily accessible savings products to all strata of the population. In some countries, savings banks were created on public initiative; in others, socially committed individuals created foundations to put in place the necessary infrastructure. Nowadays, European savings banks have kept their focus on retail banking: payments, savings products, credits and insurances for individuals or small and medium-sized enterprises. Apart from this retail focus, they also differ from commercial banks by their broadly decentralized distribution network, providing local and regional outreach—and by their socially responsible approach to business and society. • Building societies and Landesbanks: institutions that conduct retail banking. • Ethical banks: banks that prioritize the transparency of all operations and make only what they consider to be socially-responsible investments.Types of investment banks 15Institute of Productivity and Management
  • 16. • Investment banks "underwrite" (guarantee the sale of) stock and bond issues, trade for their own accounts, make markets, and advise corporations on capital market activities such as mergers and acquisitions. • Merchant banks were traditionally banks which engaged in trade finance. The modern definition, however, refers to banks which provide capital to firms in the form of shares rather than loans. Unlike venture capital firms, they tend not to invest in new companies.Both combined • Universal banks, more commonly known as financial services companies, engage in several of these activities. These big banks are much diversified groups that, among other services, also distribute insurance— hence the term banc assurance, a portmanteau word combining "banque or bank" and "assurance", signifying that both banking and insurance are provided by the same corporate entity.Other types of banks • Central banks are normally government-owned and charged with quasi-regulatory responsibilities, such as supervising commercial banks, or controlling the cash interest rate. They generally provide liquidity to the banking system and act as the lender of last resort in event of a crisis. • Islamic banks adhere to the concepts of Islamic law. This form of banking revolves around several well-established principles based on Islamic canons. All banking activities must avoid interest, a concept that is forbidden in Islam. Instead, the bank earns profit (markup) and fees on the financing facilities that it extends to customers.Retail Banking Products 1. Savings accountSavings accounts are accounts maintained by retail financial institutions that pay interest butcan not be used directly as money ( for example, by writing a cheque). These accounts letcustomers set aside a portion of their liquid assets while earning a monetary return. 16Institute of Productivity and Management
  • 17. 2. Current accountCurrent account or cheque account is a deposit account held at a bank or other financialinstitution, for the purpose of securely and quickly providing frequent access to funds ondemand, through a variety of different channels. Because money is available on demand theseaccounts are also referred to as demand accounts or demand deposit accounts. Transactionalaccounts are meant neither for the purpose of earning interest nor for the purpose of savings, butfor convenience of the business or personal client; hence do they tend not to bear interest.Instead, a customer can deposit or withdraw any amount of money any number of times, subjectto availability of funds. 3. Credit cardA credit card is part of a system of payments named after the small plastic card issued to usersof the system. It is a card entitling its holder to buy goods and services based on the holderspromise to pay for these goods and services. The issuer of the card grants a line of credit to theconsumer (or the user) from which the user can borrow money for payment to a merchant or asa cash advance to the user. Usage of the term "credit card" to imply a credit card account is ametonym. A credit card is different from a charge card, where a charge card requires the balanceto be paid in full each month. In contrast, credit cards allow the consumers to revolve theirbalance, at the cost of having interest charged. Most credit cards are issued by local banks orcredit unions, and are the shape and size specified by the ISO/IEC 7810 standard as ID-1. Thisis defined as 85.60 × 53.98 mm (33/8 × 21/8 in) in sizeFees charged to customersThe major fees are for: • Late payments or overdue payments • Charges that result in exceeding the credit limit on the card (whether done deliberately or by mistake), called over limit fees 17Institute of Productivity and Management
  • 18. • Returned cheque fees or payment processing fees (e.g. phone payment fee) • Cash advances and convenience cheques (often 3% of the amount) • Transactions in a foreign currency (as much as 3% of the amount). A few financial institutions do not charge a fee for this. • Membership fees (annual or monthly), sometimes a percentage of the credit limit. • Exchange rate loading fees (these may sometimes not be reported on the customers statement, even when they are applied). 4. MortgageA mortgage is a security interest in real property held by a lender as a security for a debt,usually a loan of money. While a mortgage in itself is not a debt, it is the lenders security for adebt. It is a transfer of an interest in land (or the equivalent) from the owner to the mortgagelender, on the condition that this interest will be returned to the owner when the terms of themortgage have been satisfied or performed. In other words, the mortgage is a security for theloan that the lender makes to the borrower. The word comes from the Old French word for"dead pledge," apparently meaning that the pledge ends (dies) either when the obligation isfulfilled or the property is taken through foreclosure. In most jurisdictions mortgages arestrongly associated with loans secured on real estate rather than on other property (such asships) and in some jurisdictions only land may be mortgaged. A mortgage is the standardmethod by which individuals and businesses can purchase real estate without the need to pay thefull value immediately from their own resources. See mortgage loan for residential mortgagelending, and commercial mortgage for lending against commercial property. • Participants and variant terminologyLegal systems in different countries, while having some concepts in common, employ differentterminology. However, in general, a mortgage of property involves the following parties.Mortgage lender- 18Institute of Productivity and Management
  • 19. A mortgage lender is an investor that lends money secured by a mortgage on real estate. Intodays world, most lenders sell the loans they write on the secondary mortgage market. Whenthey sell the mortgage, they earn revenue called Service Release Premium. Typically, thepurpose of the loan is for the borrower to purchase that same real estate. The borrower, knownas the mortgagor, gives the mortgage to the lender, known as the mortgagee. As the mortgagee,the lender has the right to sell the property to pay off the loan if the borrower fails to pay. 5. Unsecured LoanAn unsecured loan is a loan that is not backed by collateral. Also known as a signature loan orpersonal loan. Unsecured loans are based solely upon the borrowers credit rating. As a result,they are often much more difficult to get than a secured loan, which also factors in theborrowers income. An unsecured loan is considered much cheaper and carries less risk to theborrower. However, when an unsecured loan is granted, it does not necessarily have to bebased on a credit score. For example, if your friend lends you money without any collateral,meaning something of worth that can be repossessed if the loan isnt repaid, then your creditscore has zero to do with it, but rather the value of your friendship is at stake. Therefore the realmeaning of an unsecured loan is that it is not backed by any object of value and is lent to youbased on your good name. For financial institutional purposes, they may want to look at yourcredit score because they are not your friend and it is strictly a business transaction, thereforeyour good name may be associated with your historical payment history on prior debt, reflectingin your credit score. • Types of unsecured loansThere are three types of unsecured loans. • First there is a personal unsecured loan, meaning a loan that you individually are responsible for the repayment of. • Second is an unsecured business loan which leaves the business responsible for the repayment. 19Institute of Productivity and Management
  • 20. • Finally there is an unsecured business loan with a personal guarantee. With the latter, although the borrower is the business, you as an individual will be the payer of last resort if the business defaults on the loan 6. Mutual Fund A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciation realized is shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low-cost. The flow chart below describes broadly the working of a mutual fund: Mutual fund is a trust that pools money from a group of investors (sharing common financial goals) and invests the money thus collected into asset classes that match the stated investment objectives of the scheme. Since the stated investment objectives of a mutual fund scheme generally form the basis for an investors decision to contribute money to the pool, a mutual fund can not deviate from its stated objectives at any point of time.Wholesale Banking Products I. Project financing 20Institute of Productivity and Management
  • 21. Project finance is the long term financing of infrastructure and industrial projects based upon theprojected cash flows of the project rather than the balance sheets of the project sponsors.Usually, a project financing structure involves a number of equity investors, known as sponsors,as well as a syndicate of banks that provide loans to the operation. The loans are mostcommonly non-recourse loans, which are secured by the project assets and paid entirely fromproject cash flow, rather than from the general assets or creditworthiness of the project sponsors,a decision in part supported by financial modeling. The financing is typically secured by all ofthe project assets, including the revenue-producing contracts. Project lenders are given a lien onall of these assets, and are able to assume control of a project if the project company hasdifficulties complying with the loan terms. Generally, a special purpose entity is created foreach project, thereby shielding other assets owned by a project sponsor from the detrimentaleffects of a project failure. As a special purpose entity, the project company has no assets otherthan the project. Capital contribution commitments by the owners of the project company aresometimes necessary to ensure that the project is financially sound. II. Risk managementIn ideal risk management, a prioritization process is followed whereby the risks with the greatestloss and the greatest probability of occurring are handled first, and risks with lower probabilityof occurrence and lower loss are handled in descending order. In practice the process can bevery difficult, and balancing between risks with a high probability of occurrence but lower lossversus a risk with high loss but lower probability of occurrence can often be mishandled.Intangible risk management identifies a new type of a risk that has a 100% probability ofoccurring but is ignored by the organization due to a lack of identification ability. For example,when deficient knowledge is applied to a situation, a knowledge risk materializes. Relationshiprisk appears when ineffective collaboration occurs. Process-engagement risk may be an issuewhen ineffective operational procedures are applied. These risks directly reduce the productivityof knowledge workers, decrease cost effectiveness, profitability, service, quality, reputation,brand value, and earnings quality. Intangible risk management allows risk management to createimmediate value from the identification and reduction of risks that reduce productivity. 21Institute of Productivity and Management
  • 22. Risk management also faces difficulties in allocating resources. This is the idea of opportunitycost. Resources spent on risk management could have been spent on more profitable activities.Again, ideal risk management minimizes spending and minimizes the negative effects of risks. Company ProfileHDFC Bank Ltd. is a major Indian financial services company based in Mumbai, incorporatedin August 1994, after the Reserve Bank of India allowed establishing private sector banks. TheBank was promoted by the Housing Development Finance Corporation, a premier housingfinance company (set up in 1977) of India. HDFC Bank has 1,412 branches and over 3,295ATMs, in 528 cities in India, and all branches of the bank are linked on an online real-timebasis. As of September 30, 2008 the bank had total assets of INR 1006.82 billion. For the fiscalyear 2008-09, the bank has reported net profit of Rs.2,244.9 crore, up 41% from the previousfiscal. Total annual earnings of the bank increased by 58% reaching at Rs.19,622.8 crore in2008-09. Board of DirectorManaging Director • Mr. Aditya PuriExecutive Director • Mr. Harish Engineer 22Institute of Productivity and Management
  • 23. • Mr. Paresh SukthankarGroup Head - Equities, Private Banking, Third Party Products, NRI & InternationalConsumer Business • Mr. Abhay AimaTreasurer • Mr. Ashish PathasarthyGroup Head – Properties • Mr. Bharat ShahCountry Head - Internal Controls & Compliance Risk • Mr. G. SubramanianCountry Head - Branch Banking • Mr. Navin PuriHead – Finance • Mr. Sashi Jagdishan 23Institute of Productivity and Management
  • 24. Industry BackgroundBanking system in IndiaCurrently, India has 96 scheduled commercial banks (SCBs) - 27 public sector banks (that iswith the Government of India holding a stake), 31 private banks (these do not have governmentstake; they may be publicly listed and traded on stock exchanges) and 38 foreign banks. Theyhave a combined network of over 53,000 branches and 49,000 ATMs. According to a report byICRA Limited, a rating agency, the public sector banks hold over 75 percent of total assets ofthe banking industry, with the private and foreign banks holding 18.2% and 6.5% respectively. 24Institute of Productivity and Management
  • 25. Early historyBanking in India originated in the last decades of the 18th century. The first banks were TheGeneral Bank of India which started in 1786, and the Bank of Hindustan, both of which are nowdefunct. The oldest bank in existence in India is the State Bank of India, which originated in theBank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. This wasone of the three presidency banks, the other two being the Bank of Bombay and the Bank ofMadras, all three of which were established under charters from the British East India Company.For many years the Presidency banks acted as quasi-central banks, as did their successors. Thethree banks merged in 1921 to form the Imperial Bank of India, which, upon Indiasindependence, became the State Bank of India. 25Institute of Productivity and Management
  • 26. Indian merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as aconsequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 andstill functioning today, is the oldest Joint Stock bank in India. It was not the first though. Thathonor belongs to the Bank of Upper India, which was established in 1863, and which surviveduntil 1913, when it failed, with some of its assets and liabilities being transferred to the AllianceBank of Shimla.When the American Civil War stopped the supply of cotton to Lancashire from the ConfederateStates, promoters opened banks to finance trading in Indian cotton. With large exposure tospeculative ventures, most of the banks opened in India during that period failed. The depositorslost money and lost interest in keeping deposits with banks. Subsequently, banking in Indiaremained the exclusive domain of Europeans for next several decades until the beginning of the20th century.Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The ComptoiredEscompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862;branches in Madras and Pondicherry, then a French colony, followed. HSBC established itselfin Bengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade ofthe British Empire, and so became a banking center.The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in1895, which has survived to the present and is now one of the largest banks in India.Around the turn of the 20th Century, the Indian economy was passing through a relative periodof stability. Around five decades had elapsed since the Indian Mutiny, and the social, industrialand other infrastructure had improved. Indians had established small banks, most of whichserved particular ethnic and religious communities.The presidency banks dominated banking in India but there were also some exchange banks anda number of Indian joint stock banks. All these banks operated in different segments of theeconomy. The exchange banks, mostly owned by Europeans, concentrated on financing foreigntrade. Indian joint stock banks were generally under capitalized and lacked the experience and 26Institute of Productivity and Management
  • 27. maturity to compete with the presidency and exchange banks. This segmentation let LordCurzon to observe, "In respect of banking it seems we are behind the times. We are like someold fashioned sailing ship, divided by solid wooden bulkheads into separate and cumbersomecompartments."The period between 1906 and 1911, saw the establishment of banks inspired by the Swadeshimovement. The Swadeshi movement inspired local businessmen and political figures to foundbanks of and for the Indian community. A number of banks established then have survived tothe present such as Bank of India, Corporation Bank, Indian Bank, Bank of Baroda, CanaraBank and Central Bank of India.The fervour of Swadeshi movement lead to establishing of many private banks in DakshinaKannada and Udupi district which were unified earlier and known by the name South Canara( South Kanara ) district. Four nationalised banks started in this district and also a leadingprivate sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of IndianBanking".List of banks in India:-Public Sector BanksThere are total 26 public sector banks in India (As on 26-09-2009). Of these 19 are nationalisedbanks, 6(STATE BANK OF INDORE ALSO MERGED RECENTLY) belong to SBI &associates group and 1 bank (IDBI Bank) is classified as other public sector bank.Nationalized Banks • Bank of Baroda • Dena Bank 27Institute of Productivity and Management
  • 28. • Indian Bank • Indian Overseas Bank • Oriental Bank of Commerce • Punjab National Bank • Punjab and Sind Bank • Syndicate Bank • UCO Bank • Union Bank of India • United Bank of India • Vijaya Bank • Repco bank • Allahabad bankSBI & associates • State Bank of India • State Bank of Bikaner and Jaipur • State Bank of Indore • State Bank of Travancore • State Bank of Patiala • State Bank of Hyderabad • State Bank of MysorePrivate Banks 28Institute of Productivity and Management
  • 29. • Axis Bank • Bank of Rajasthan • Catholic Syrian Bank • City Union Bank • Development Credit Bank • Dhanalakshmi Bank • Federal Bank • HDFC Bank • ICICI Bank • ING Vysya Bank • Jammu & Kashmir Bank • Karnataka Bank • Kotak Mahindra Bank • Laxmi Vilas Bank • Yes Bank 29Institute of Productivity and Management
  • 30. Competitive Situation ICICI Bank (formerly Industrial Credit and Investment Corporation of India) is a major banking and financial services organization in India. It is the 4th largest bank in India and the largest private sector bank in India bymarket capitalization. The bank also has a network of 1,700+ branches (as on 31 March 2010)and about 4,721 ATMs in India and presence in 19 countries, as well as some 24 millioncustomers (at the end of July 2007). ICICI Bank offers a wide range of banking products andfinancial services to corporate and retail customers through a variety of delivery channels andspecialization subsidiaries and affiliates in the areas of investment banking, life and non-lifeinsurance, venture capital and asset management. (These data are dynamic.) ICICI Bank is alsothe largest issuer of credit cards in India. The Bank is expanding in overseas markets and has thelargest international balance sheet among Indian banks. ICICI Bank now has wholly-ownedsubsidiaries, branches and representatives offices in 19 countries, including an offshore unit inMumbai. Axis Bank, formally UTI Bank, is a financial services firm that had begun operations in 1994, after the Government of India allowed new privatebanks to be established. The Bank was promoted jointly by the Administrator of the SpecifiedUndertaking of the Unit Trust of India (UTI-I), Life Insurance Corporation of India (LIC),General Insurance Corporation Ltd., National Insurance Company Ltd., The New IndiaAssurance Company, The Oriental Insurance Corporation and United India Insurance CompanyUTI-I holds a special position in the Indian capital markets and has promoted many leadingfinancial institutions in the country. The bank changed its name to Axis Bank in April 2007 toavoid confusion with other unrelated entities with similar name..As on the year ended March 31,2009 the Bank had a total income of Rs 13,745.04 crore (US$ 2.93 billion) and a net profit ofRs. 1,812.93 crore (US$ 386.15 million).On February 24, 2010, Axis Bank announced thelaunch of AXIS CALL & PAY on atom, a unique mobile payments solution using Axis Bank 30Institute of Productivity and Management
  • 31. debit cards. Axis Bank is the first bank in the country to provide a secure debit card-basedpayment service over IVR. State Bank of India is the largest state-owned banking and financial services company in India, by almost every parameter -revenues, profits, assets, market capitalization, etc. The bank traces its ancestry to British India,through the Imperial Bank of India, to the founding in 1806 of the Bank of Calcutta, making itthe oldest commercial bank in the Indian Subcontinent. The Government of India nationalizedthe Imperial Bank of India in 1955, with the Reserve Bank of India taking a 60% stake, andrenamed it the State Bank of India. In 2008, the Government took over the stake held by theReserve Bank of India.SBI provides a range of banking products through its vast network ofbranches in India and overseas, including products aimed at NRIs. The State Bank Group, withover 16,000 branches, has the largest banking branch network in India. With an asset base of$260 billion and $195 billion in deposits, it is a regional banking behemoth. It has a marketshare among Indian commercial banks of about 20% in deposits and advances, and SBIaccounts for almost one-fifth of the nations loans. Bank of Baroda is the third largest bank in India, after the State Bank of India and the Punjab National Bank and ahead of ICICI Bank. BOB has total assets in excess of Rs. 2.27 lakh crores, orRs. 2,274 billion, a network of over 3,000 branches and offices, and about 1,100 ATMs. It offersa wide range of banking products and financial services to corporate and retail customersthrough a variety of delivery channels and through its specialized subsidiaries and affiliates inthe areas of investment banking, credit cards and asset management. As of August 2010, thebank has 78 branches abroad and by the end of FY11 this number should climb to 90. In 2010,BOB opened a branch in Auckland, New Zealand, and its tenth branch in the United Kingdom.The bank also plans to open five branches in Africa. 31Institute of Productivity and Management
  • 32. Company BackgroundHistory of HDFC Bank Ltd.HDFC Bank Ltd. is a commercial bank of India, incorporated in August 1994, afterthe Reserve Bank of India allowed establishing private sector banks. The Bank was promoted bythe Housing Development Finance Corporation, a premier housing finance company (set up in1977) of India. HDFC Bank has 1,412 branches and over 3,295 ATMs, in 528 cities in India,and all branches of the bank are linked on an online real-time basis. As of September 30, 2008the bank had total assets of INR 1006.82 billion. For the fiscal year 2008-09, the bank hasreported net profit of Rs.2,244.9 crore, up 41% from the previous fiscal. Total annual earningsof the bank increased by 58% reaching at Rs.19,622.8 crore in 2008-09.HDFC Bank was incorporated in the year of 1994 by Housing Development FinanceCorporation Limited (HDFC), Indias premier housing finance company. It was among the firstcompanies to receive an in principle approval from the Reserve Bank of India (RBI) to set up abank in the private sector. The Bank commenced its operations as a Scheduled CommercialBank in January 1995 with the help of RBIs liberalization policies.In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches to more than1,000. The amalgamated bank emerged with a strong deposit base of around Rs. 1,22,000 croreand net advances of around Rs. 89,000 crore. The balance sheet size of the combined entity isover Rs. 1,63,000 crore. The amalgamation added significant value to HDFC Bank in terms ofincreased branch network, geographic reach, and customer base, and a bigger pool of skilledmanpower.Business FocusHDFC Bank deals with three key business segments – Wholesale Banking Services, RetailBanking Services, Treasury. It has entered the banking consortia of over 50 corporates forproviding working capital finance, tradeservices, corporate finance and merchant banking. It isalso providing sophisticated product structures in areas of foreign exchange and derivatives,money markets and debt trading and equity research. 32Institute of Productivity and Management
  • 33. Wholesale Banking ServicesThe Banks target market ranges from large, blue-chip manufacturing companies in the Indiancorp to small & mid-sized corporates and agri-based businesses. For these customers, the Bankprovides a wide range of commercial and transactional banking services, including workingcapital finance, trade services, transactional services, cash management, etc. The bank is also aleading provider of structured solutions, which combine cash management services with vendorand distributor finance for facilitating superior supply chain management for its corporatecustomers. HDFC Bank has made significant inroads into the banking consortia of a number ofleading Indian corporate including multinationals, companies from the domestic business housesand prime public sector companies. It is recognized as a leading provider of cash managementand transactional banking solutions to corporate customers, mutual funds, stock exchangemembers and banks.Retail Banking ServicesThe objective of the Retail Bank is to provide its target market customers a full range offinancial products and banking services, giving the customer a one-stop window for all his/herbanking requirements. The products are backed by world-class service and delivered tocustomers through the growing branch network, as well as through alternative delivery channelslike ATMs, Phone Banking, NetBanking and Mobile Banking.HDFC Bank was the first bank in India to launch an International Debit Card in association withVISA (VISA Electron) and issues the Mastercard Maestro debit card as well. The Banklaunched its credit card business in late 2001. By March 2009, the bank had a total card base(debit and credit cards) of over 13 million. The Bank is also one of the leading players in the“merchant acquiring” business with over 70,000 Point-of-sale (POS) terminals for debit / creditcards acceptance at merchant establishments. The Bank is well positioned as a leader in variousnet based B2C opportunities including a wide range of internet banking services for FixedDeposits, Loans, Bill Payments, etc.Treasury 33Institute of Productivity and Management
  • 34. Within this business, the bank has three main product areas - Foreign Exchange and Derivatives,Local Currency Money Market & Debt Securities, and Equities. These services are providedthrough the banks Treasury team. To comply with statutory reserve requirements, the bank isrequired to hold 25% of its deposits in government securities. The Treasury business isresponsible for managing the returns and market risk on this investment portfolio.Distribution network:HDFC Bank is headquartered in Mumbai. The Bank has an network of 1,725 branches spread in771 cities across India. All branches are linked on an online real-time basis. Customers in over500 locations are also serviced through Telephone Banking. The Bank has a presence in allmajor industrial and commercial centres across the country. Being a clearing/settlement bank tovarious leading stock exchanges, the Bank has branches in the centres where the NSE/BSE havea strong and active member base.The Bank also has 3,898 networked ATMs across these cities. Moreover, HDFC Banks ATMnetwork can be accessed by all domestic and international Visa/MasterCard, VisaElectron/Maestro, Plus/Cirrus and American Express Credit/Charge cardholders.In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches to more than 1,000. Though, the official license was given to Centurion Bank of Punjab branches, to continue working as HDFC Bank branches, on May 23, 2008Housing Development Finance Corporation Limited, more popularly known as HDFC BankLtd, was established in the year 1994, as a part of the liberalization of the Indian BankingIndustry by Reserve Bank of India (RBI). It was one of the first banks to receive an in principleapproval from RBI, for setting up a bank in the private sector. The bank was incorporated withthe name HDFC Bank Limited, with its registered office in Mumbai. The following year, itstarted its operations as a Scheduled Commercial Bank. Today, the bank boasts of as many as1412 branches and over 3275 ATMs across India.AmalgamationsIn 2002, HDFC Bank witnessed its merger with Times Bank Limited (a private sector bank 34Institute of Productivity and Management
  • 35. promoted by Bennett, Coleman & Co. / Times Group). With this, HDFC and Times became thefirst two private banks in the New Generation Private Sector Banks to have gone through amerger. In 2008, RBI approved the amalgamation of Centurion Bank of Punjab with HDFCBank. With this, the Deposits of the merged entity became Rs. 1,22,000 crore, while theAdvances were Rs. 89,000 crore and Balance Sheet size was Rs. 1,63,000 crore.Tech-SavvyHDFC Bank has always prided itself on a highly automated environment, be it in terms ofinformation technology or communication systems. All the braches of the bank boast of onlineconnectivity with the other, ensuring speedy funds transfer for the clients. At the same time, thebanks branch network and Automated Teller Machines (ATMs) allow multi-branch access toretail clients. The bank makes use of its up-to-date technology, along with market position andexpertise, to create a competitive advantage and build market share.Capital StructureAt present, HDFC Bank boasts of an authorized capital of Rs 550 crore (Rs5.5 billion), of thisthe paid-up amount is Rs 424.6 crore (Rs.4.2 billion). In terms of equity share, the HDFC Groupholds 19.4%. Foreign Institutional Investors (FIIs) have around 28% of the equity and about17.6% is held by the ADS Depository (in respect of the banks American Depository Shares(ADS) Issue). The bank has about 570,000 shareholders. Its shares find a listing on the StockExchange, Mumbai and National Stock Exchange, while its American Depository Shares arelisted on the New York Stock Exchange (NYSE), under the symbol HDB.Housing Finance SectorAgainst the milieu of rapid urbanization and a changing socio-economic scenario, the demandfor housing has grown explosively. The importance of the housing sector in the economy can beillustrated by a few key statistics. According to the National Building Organization (NBO), thetotal demand for housing is estimated at 2 million units per year and the total housing shortfall isestimated to be 19.4 million units, of which 12.76 million units is from rural areas and 6.64million units from urban areas. The housing industry is the second largest employmentgenerator in the country. It is estimated that the budgeted 2 million units would lead to the 35Institute of Productivity and Management
  • 36. creation of an additional 10 million man-years of direct employment and another 15 millionman-years of indirect employment.Having identified housing as a priority area in the Ninth Five Year Plan (1997-2002), theNational Housing Policy has envisaged an investment target of Rs. 1,500 billion for this sector.In order to achieve this investment target, the Government needs to make low cost funds easilyavailable and enforce legal and regulatory reforms.BackgroundHDFC was incorporated in 1977 with the primary objective of meeting a social need - that ofpromoting home ownership by providing long-term finance to households for their housingneeds. HDFC was promoted with an initial share capital of Rs. 100 million.Business ObjectivesThe primary objective of HDFC is to enhance residential housing stock in the country throughthe provision of housing finance in a systematic and professional manner, and to promote homeownership. Another objective is to increase the flow of resources to the housing sector byintegrating the housing finance sector with the overall domestic financial markets.Organizational Goals o HDFCs main goals are to a) develop close relationships with individual households, b) maintain its position as the premier housing finance institution in the country, c) transform ideas into viable and creative solutions, d) provide consistently high returns to shareholders, and e) to grow through diversification by leveraging off the existing client base. o HDFC is a professionally managed organization with a board of directors consisting of eminent persons who represent various fields including finance, taxation, construction 36Institute of Productivity and Management
  • 37. and urban policy & development. The board primarily focuses on strategy formulation, policy and control, designed to deliver increasing value to shareholders. Organizational Chart 37Institute of Productivity and Management
  • 38. Products at glanceAccounts & Deposits Loans Investments & InsuranceSavings Accounts: • Personal Loan • Mutual Funds • Regular Savings Account • Smart Draft • Tax Planning • Savings Plus Account • Home Loan • Insurance • Savings Max Account • Two wheeler Loan • General & Health • Senior citizen Account Insurance • New Car Loan • No Frills Account • Bonds • Used Car Loan • Institutional Savings • Knowledge centre • Gold Loan Account • Equities & • Educational Loan Derivatives • Salary Accounts: • Loan against • Mudra Gold Bar • Payroll Securities Forex Services • Classic • Loan against • Products & Property Services • Regular • Health Care Finance • Trade services • Premium • Commercial Vehicle • Forex Services • Defence Finance Branch Locator • No Frills Salary Account • Loan Against Rental • RBI Guidelines Receivables • Reimbursement Current • Forex Limits Account • Retail Agri Loan Payment Services • Net Safe • Kid’s Advantage Account • Tractor Loan • Merchant Services • Working Capital Finance 38Institute of Productivity and Management
  • 39. • Pension Saving Bank • Construction • Prepaid Refills Account Equipment Finance • Bill Pay • Family Saving Group • Warehouse receipt Loan • Visa Bill Pay • Kisan No Frill Saving Cards • Pay Now • Kisan Club Services Credit Cards: • Register & Pay • Silver Credit CardCurrent Accounts: • Insta Pay • Gold Credit Card • Plus Current Account • Titanium Credit • Direct Pay • Regular Current Account Card • M Chek • Trade Current Account • Woman’s Gold Credit card • Visa Money • Premium Current Account Transfer • Platinum Gold • RFC-Domestic Account Credit card • RTGS Funds Transfer • Flexi Current Account • Visa Signature Credit card • e-monies • Apex Current Account Electronic Fund • World Master Transfer • Max Current Account CardCredit Card • Donate to CharityFixed Deposits: • Corporate Platinum credit Card • Religious offerings • Regular Fixed Account • Online payment of • Corporate Credit • 5 Year Tax Saving Fixed DVAT card Account • Business Platinum • Online payment of • Super saver facility Gujarat VAT Credit Card • Sweep-in facility • Online payment of • Business Gold Credit card Direct TaxRecurring Deposits • Purchase card • Excise & ServiceDemat Account Tax Payment • Distributor card Access Your Bank 39Institute of Productivity and Management
  • 40. Safe deposits Lockers • Net Banking Debit Cards: • Credit Card Online • Easy Shop • One View International Debit Card • Insta AlertsHDFC Bank • Easy Shop GoldImperia/Preferred/Classic Debit Card • Mobile BankingBanking • Easy Shop • ATM • Imperia Premium Banking International Business Debit Card • Phone Banking • Preferred Banking • Easy Shop • Email Statements • Classic Banking Woman’s Advantage Debit • Branch NetworksPrivate Banking card • Easy Shop Titanium Debit Card • Easy Shop NRO Debit Card Prepaid Cards: • Forex Plus card • Gift Plus Card • Food Plus Card • Money Plus Card • Forex Plus Chip Card LOANS • Personal Loans: 40Institute of Productivity and Management
  • 41. HDFC Personal Loans have been designed by HDFC Bank to suit personal requirements ofindividuals like marriage, holiday, and education, purchase of any expensive commodity or anysuch anticipated or unanticipated monetary involvement.Features & benefits: • Borrow up to Rs 15, 00,000 for any purpose depending on your requirements • Flexible Repayment options, ranging from 12 to 60 months. • Repay with easy EMIs. • One of the lowest interest rates. • Hassle free loans - No guarantor/security/collateral required. • Speedy loan approval. • Convenience of service at your doorstep. • Further, there are additional privileges for HDFC Bank account holders like: o Special rates of interest. o For existing Auto Loan customers with a clear repayment of 12 months or more from even any of the approved financiers of HDFC Bank, a hassle free personal loan without income documentation can be obtained. o For existing HDFC Bank Personal Loan customer with a clear repayment of 12 months or more, personal loan can be enhanced.Credit ShieldIn case of death or total permanent disability of the loaner, the loaner/nominee can avail of thePayment Protection Insurance (Credit Shield) which insures the principle outstanding on theloan up to a maximum of the loan amount. Principle outstanding is defined as the amount ofloan outstanding (not including any arrears in payment or interest thereon) at the Date of Loss,having accounted for payments made and interest accruing as determined in the Policy. 41Institute of Productivity and Management
  • 42. Hence,the amount covered does not include any principal added because of non - payment ofEMI and also will not include interest/ accrued charges.*Personal Accident CoverIn order to ensure that your family is taken care of we also offer a Personal Accident cover ofRs.2,00,000 at a nominal premium.** Premium will be charged for both these products which will be deducted from the loanamount at the time of disbursal .A transaction fee of Rs.750 will also be deducted at the time ofdisbursal. Please note that service tax @ 10% and Education cess of 3% will also be charged.Eligibility and Documentation:-  Salaried Individuals  Self Employed (Professional)  Self Employed (Individuals)  Self Employed(Private companies and Partnership Firms) 1. Salaried Individuals:Salaried Individuals include Salaried Doctors, CAs, employees of select Public and Privatelimited companies, Government Sector employees including public sector undertakings andcentral, state and local bodies:Eligibility Criteria  Minimum age of Applicant: 21 years  Maximum age of Applicant at loan maturity: 60 years  Minimum employment: Minimum 2 years in employment and minimum 1 year in the current organization  Minimum Net Monthly Income: Rs. 10,000 per month (Rs. 15,000 in Mumbai, Delhi, Bangalore, Chennai and Hyderabad & Rs. 12,000 in Calcutta, Ahmedabad and Cochin) 42Institute of Productivity and Management
  • 43. Documents required:  Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence)  Address Proof (Ration card Tel/Elect. Bill/ Rental agr. / Passport copy/Trade licence /Est./Sales Tax certificate)  Bank Statements (latest 3 months bank statement / 6 months bank passbook)  Latest salary slip or current dated salary certificate with latest Form 16. 2. Self Employed (Professional):Self employed (Professionals) include self - employed Doctors, Chartered Accountants,Architects, and Company Secretaries.Eligibility Criteria • Minimum age of Applicant: 25 years • Maximum age of Applicant at loan maturity: 65 years • Years in business: 4 to 7 years depending on profession • Minimum Annual Income: Rs. 100000 p.a.Documents required:  Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence).  Address Proof (Ration card Tel/elect. Bill/ Rental agr. / Passport copy/Trade licence /Est./Sales Tax certificate).  Bank Statements(latest 6 months bank statement /passbook)  Latest ITR along with computation of income, B/S & P&L a/c for the last 2 yrs. certified by a CA  Qualification proof of the highest professional degree. 3. Self Employed (Individuals): 43Institute of Productivity and Management
  • 44. Self Employed (Pvt. Cos and Partnership Firms) include Private Companies and Partnershipfirms in the Business of Manufacturing, Trading or ServicesEligibility Criteria  Years in business: Minimum of 3 years in current business and 5 years total business experience  Business must be profit making for the last 2 years  Minimum Annual Income: Rs 100000 p.a.Documents required:  Address Proof (Ration card Tel/elect. Bill/ Rental agr. / Passport copy/Trade licence /Est./Sales Tax certificate)  Bank Statements(latest 6 months bank statement /passbook)  Latest ITR along with computation of income, B/S & P&L a/c for the last 2 yrs. certified by a CA  Proof of continuation (Trade license /Establishment /Sales Tax certificate)Fees & Charges for Personal Loan:Description of Charges Personal LoanLoan Processing Charges Upto 2.50% of the loan amountPrepayment Salaried - No pre-payment permitted until repayment of 12 EMIs Self-employed - No pre-payment permitted until repayment of 6 EMIsPre-payment charges Salaried - 4% of the Principal Outstanding after repayment of 12 EMIs Self-employed - 4% of the Principal Outstanding after 44Institute of Productivity and Management
  • 45. repayment of 6 EMIsNo Due Certificate / No Objection Certificate (NOC) NILDuplicate no due certificate / NOC Rs 250/-Solvency Certificate Not applicableCharges for late payment of EMI @ 24 % p.a on amount outstanding from date of defaultCharges for changing from fixed to floating rate of Not applicableinterestCharges for changing from floating to fixed rate of Not applicableinterestStamp Duty & other statutory charges As per applicable laws of the stateCredit assessment charges Not applicableNon standard repayment charges Not applicableCheque swapping charges Rs 500/- per eventLoan Re-booking charges / Re-scheduling charges Rs 1000/-Loan cancellation charges Rs. 1000/-Cheque Bounce Charges Rs 450/- per cheque bounceLegal / incidental charges At actual • Business Loan:Small & Medium EnterprisesAt HDFC Bank we understand how much of hard work goes into establishing a successfulSME. We also understand that your business is anything but "small" and as demanding as ever.And as your business expands and enters new territories and markets, you need to keep pacewith the growing requests that come in, which may lead to purchasing new, or updating existingplant and equipment, or employing new staff to cope with the demand. That´s why we at HDFCBank have assembled products, services, resources and expert advice to help ensure that yourbusiness excels. 45Institute of Productivity and Management
  • 46. Our solutions are designed to meet your varying needs. The following links will help you identify your individual needs. Funded Services Funded Services from HDFC Bank are meant to directly bolster the day-to-day working of a small and a medium business enterprise. From working capital finance to credit substitutes; from export credit to construction equipment loan - we cater to virtually every business requirement of an SME. Click on the services below that best define your needs.• Working Capital Finance• Commercial Vehicle finance• Construction Equipment Loan• Short Term Finance• Bill Discounting• Credit Substitutes• Export Credit• Structured Cash Flow Financing• Real Estate Initiatives• Non-Funded Services Under Non-Funded services HDFC Bank offers solutions that act as a catalyst to propel your business. Imagine a situation where you have a letter of credit and need finance against the same or you have a tender and you need to equip yourself with a guarantee in order to go ahead. This is exactly where we can help you so that you dont face any roadblocks when it comes to your business. • Home Loan: 46 Institute of Productivity and Management
  • 47. Home Loans offered by HDFC Bank encompasses a wide range of loan options which aresubject to various parameters like term of loan, financial status of the individual seeking loanand the purpose of loan. Owing to these diversifications, HDFC Home Loans have grown inpopularity over the years.The primary subdivision of HDFC Home Loans is loans for:• Resident Indian• Non Resident IndianLoans for Resident Indians:With an HDFC Home Loan, one can buy a self-contained flat in an existing or proposed co-operative society, in an apartment owners association or even an independent single-family ormulti-family bungalow anywhere in India.HDFC Home Loans are easy to arrange and can be customized according to the individualsneeds and repayment capabilities.This category can be further into subdivided into: • Home Loans: Home loans for individuals to purchase (fresh / resale) or construct houses. Application can be made individually or jointly. HDFC finances up to 85% maximum of the cost of the property (Agreement value + Stamp duty + Registration charges) based on the repayment capacity of the customer. • Home Improvement Loan - HIL facilitates internal and external repairs and other structural improvements like painting, waterproofing, plumbing and electric works, tiling and flooring, grills and aluminum windows. HDFC finances up to 85% of the cost of renovation (100% for existing customers) subject to market value of the property. • Home Extension Loan - HEL facilitates the extension of an existing dwelling unit. All the terms are the same as applicable to Home Loan. • Land Purchase Loan - Be it land for a dream house, or just an investment for the future, HDFC Land Purchase Loan is a convenient loan facility to purchase land. HDFC 47Institute of Productivity and Management
  • 48. finances up to 85% of the cost of the land (Conditions Apply). Repayment of the loan can be done over a maximum period of 15 years • Short Term Bridging Loans • Professional Loan or Loan for Non-residential Premises • Home Equity LoanLoans for Non Resident Indians:Like Resident Indians, HDFC Home Loans feature similar categories of loans for Non ResidentIndians as well. They include:• Home Loan• Home Improvement Loan• Home Extension Loan• Land Purchase LoanFeatures & Benefits: o Choose from Fixed Rate or Floating Rate with options to structure your loan as Partly Fixed or Partly Floating. o Flexible repayment options to suit your individual needs. o Loan cover Term Assurance Plan - HDFC Standard Life Insurance Company Ltd. offers an insurance plan*, which is designed to ensure that lifes uncertainties do not affect your familys interests and your precious home. LCTAP provides a lump-sum payment on the unfortunate demise of the life assured. This pure risk plan is designed in a way that the cover decreases as you repay your home loan making it a low cost premium insurance plan. *Insurance is the subject matter of solicitation. o Automated Repayment of Home loan EMI - You can give us standing instructions to repay your Home Loan EMIs directly from your HDFC Bank Savings Account, thus, saving you the trouble of procuring, signing and tracking post-dated cheques. 48Institute of Productivity and Management
  • 49. o HDFC also offers In-house scrutiny of Property documents for your complete peace of mind. o Customer privileges - If you are an existing HDFC Home Loan customer, you can avail of other loans (such as Personal Loans, Car Loans, Two-wheeler Loans and Loan against securities) at lower interest rates. o Applicant and Co - Applicant to the loan: Loans can be applied for either individually or jointly. Proposed owners of the property will have to be co-applicants. However, the co-applicants need not be co-owners. o Hassle Free Documentation - no security/guarantor is required. o Loan Amount: Customers are eligible to get upto 85% of the amount of the property. o Tenure: 1-20Years o Adjustable Rate Home Loan Loan under Adjustable Rate is linked to HDFCs Retail Prime Lending Rate (RPLR). The rate on your loan will be revised every three months from the date of first disbursement, if there is a change in RPLR, the interest rate on your loan may change. However, the EMI on the loan disbursed will not change*. If the interest rate increases, the interest component in an EMI will increase and the principal component will reduce resulting in an extension of term of the loan, and vice versa when the interest rate decreases. *Conditions ApplyDocuments: • Application Form and submit along with the following documents for an approval of loan. • Application form with photograph • Identity and Residence Proof • Education Qualifications Certificate and Proof of business existence • Last 3 years Income Tax returns (self and business) 49Institute of Productivity and Management
  • 50. • Last 3 years Profit /Loss and Balance Sheet • Last 6 months bank statements • Processing fee chequeRedemption ChargesAdjustable Rate Home Loan [ARHL]If a prepayment is made within 3 years of the first disbursement*, under Adjustable Rate HomeLoan (ARHL) option early redemption charges of 2% of the amount being prepaid is payable ifthe amount being repaid is more than 25% of the opening balance.Fixed Rate Home Loan [FRHL]Redemption charges of 2% of the amount being prepaid is payable if the amount being repaid ismore than 25% of the opening balanceIncase of commercial refinance under both the FRHL and ARHL an early redemption charge of2% is payable. You may be required to submit copies of your Bank Statements or any otherdocuments that HDFC deems necessary to verify the source of prepayment.*Subject to terms and conditionsSecuritySecurity for the loan is a first mortgage of property to be financed, normally by way of depositof title deeds and/or such other collateral security as may be necessary. Interim security may berequired, if the property is under construction.Current Home Loan Interest Rates of HDFC Bank Home Loan Loan Schemes Up to 30 Lacs From 30 lacs to 50 Lacs Above 50 Lacs HDFC Bank Floating 8.25% Floating 9% Floating 9.25%Eligibility Criteria & Documentation required for HDFC Bank Home Loan 50Institute of Productivity and Management
  • 51. Salaried Self employed AGE 21years to 58years 21years to 65years Income Rs.1,20,000 (p.a) Rs.1,50,000 (p.a) Loan Amount 2,00,000 - 1,00,00000 2,00,000 - 2,00,00000 Offered Tenure 5years-20years 5years-20yearsCurrent Experience 3years 2years Processing Fee 11000/- or 0.5% 11000/- or 0.5% Documentation 1) Application form with 1) Application form with photograph photograph 2) Identity & residence proof 2) Identity & residence proof 3) Education qualifications certificate & proof of business 3) Latest salary slip, existence 4) Form 16 4) Business profile, Last 3 years profit/loss & balance 5) Last 6 months bank sheet statements 5) Last 6 months bank statements 6) Processing fee cheque 6) Processing fee chequeHome Loan Fees & Charges:Description of Charges Ecbop Home LoanForeclosure charges No prepayments allowed in first 6 months 6 months - 5 years - 1.5% of original loan amount 5 years -10 years - 0.75% of original loan amount > 10 years - No closure fee For Gold Category 6 months - 5 years - 2% of original loan amount > 5 years - No closure fee eBOP customers : Loan repaid from own sources - no FC charges Loan repaid from other sources - regular FC charges.Charges for late payment of EMI 2% per monthCheque swapping charges Rs 500/- 51Institute of Productivity and Management
  • 52. Bounce Cheque Charges Rs. 500/-Duplicate Statement Charges (per Rs 100/- per page, Maximum Rs 300/-statement)Issue of Duplicate Provisional Rs. 300/-Interest CertificateIssue of Duplicate Interest Rs. 300/-CertificateDuplicate Balance Certificate Rs. 300/-Issue of Amortization Schedule Rs. 300/-(Duplicate)Switch from Variable to Fixed Not ApplicableSwitch from Fixed to Variable Not ApplicablePhotocopy of Documents Rs. 500/-Multiple Repayment Option:Step Up Repayment FacilityHelps young executives take a much bigger loan today based on an increase in their futureincome, this helps executives buy a bigger home today!Flexible Loan installments PlanOften customers, parents and their children, wish to purchase properties together. The parent isnearing retirement and their children have just started working. This option helps suchcustomers combine the incomes and take a long term home loan where in the installmentreduces upon retirement of the earning parent.Tranche Based EMICustomers purchasing an under construction property need to pay interest ( on the loan amountdrawn based on level of construction) till the property is ready . To help customer save thisinterest, we have introduced a special facility of tranche Based EMI. Customers can fix the 52Institute of Productivity and Management
  • 53. installments they wish to pay till the property is ready. The minimum amount payable is theinterest on the loan amount drawn. Anything over and above the interest paid by the customergoes towards Principal repayment. The customer benefits by starting EMI and hence repays theloan faster. • Loan against Property (LAP):You can now take a loan against your residential or commercial property, to expand yourbusiness, plan a dream wedding, fund your childs education and much more.Loan to purchase Commercial Property (LCP) is a specially designed product to help youexpand your business without reducing the capital from your business.Features & Benefits: • Loans from Rs. 2 Lacs onwards depending on your needs. • Borrow up to 50% of market value of the property. • Flexibility to choose between an EMI based loan or an Overdraft - We also offer to you overdraft against your self-occupied residential or commercial property and you save money by paying interest only on the amount utilized! • High tenure loans for ease of repayment. • Attractive interest rates. • Simple and speedy processing. • Specially designed products for Self Employed.Eligibility & Documentation: 53Institute of Productivity and Management
  • 54. • Salaried Individuals • Self EmployedSalaried IndividualsDocuments required:  Proof of Residence - Any one of Ration Card / Telephone Bill / Electricity Bill / Voters Card.  Proof of Identity - Any one of Voters Card / Drivers License / Employers Card.  Latest Bank Statement / Passbook (where salary / income is credited for past 6 months).  Latest 3 Months Salary Slip with all deductions & last 2 years Form 16.  Copies of all Property Documents.Self EmployedDocuments required:  Certified Financial Statement for the last 2 years.  Proof of Residence - Any one of Ration Card / Telephone Bill / Electricity Bill / Voters Card.  Proof of Identity - Any one of Voters Card / Drivers License / Employers Card.  Latest Bank Statement / Passbook (where salary / income is credited for past 6 months).  Copies of all Property Documents.Fees & Charges for Loan Against Property:Description of Charges Loan Against Property Dropline Overdraft Loan Against Rent Against Property / Receivables Commercial OD against PropertyLoan Processing 2% 2% 2%Charges* 54Institute of Productivity and Management
  • 55. ( * Minimum PF ofRs.7500/- )Pre-payment charges 4% of the outstanding 4% of the operating limit 4% of the outstanding principal (Prepayment prevailing at the time of principal (Prepayment cannot be made until six prepayment cannot be made until six months of repayment) months of repayment)No Due Certificate / No Nil Nil NilObjection Certificate(NOC)Solvency Certificate Not applicable Not applicable Not applicableCharges for late payment 2 % per month on overdue 18% penal interest 2 % per month on overdueof EMI EMI amount applicable on overdue EMI amount amountCharges for changing 0.25% of the loan amount Only Bank PLR Linked Only Bank PLR Linkedfrom fixed to Bank PLR interest rate option interest rate optionLinked interest ratesCharges for changing 1.5% of the loan amount Only Bank PLR Linked Only Bank PLR Linkedfrom Bank PLR Linked interest rate option interest rate optioninterest rates to fixedrate of interestDuplicate no due Rs 250/- Rs 250/- Rs 250/-certificate / NOCStamp Duty & other As per applicable laws of As per applicable laws of As per applicable laws ofstatutory charges the state the state the stateCheque swapping Rs 500/- Rs 500/- Rs 500/-chargesBounce Cheque Charges Rs 450/- Rs 450/- Rs 450/-Duplicate Repayment Rs 500/- Rs 500/- Rs 500/-Schedule chargesLegal / Repossession & At actuals At actuals At actualsIncidental charges 55Institute of Productivity and Management
  • 56. Account Maintenance NIL Rs.5000 p.a. Rs.10000 p.a.Charges • Two wheeler loan:Features & Benefits: • Flexible repayment options, ranging from 12 to 48 months available even at the point of purchase. • Repay through post-dated cheques with easy EMIs. • Hassle free loans - No guarantor required. • Speedy loan approval. • Available for almost all models at attractive interest rates. • Free gifts from time to time on approval of your Two Wheeler Loan. (Watch this space for more details on the free gift promotion).Eligibility & Documentation:Eligibility Criteria:The eligibility criteria for a Two Wheeler Loan are: • You are a salaried or self-employed individual. • You are between =>21 years (at the time of application) and <= 65 years (at the end of the loan tenor). • Your minimum gross income is equivalent to Rs. 54,000/- p.a. if you reside in Mumbai, Delhi, Chennai, Bangalore, Calcutta, Pune and Rs. 42,000/- p.a. for all other cities. • You have been residing for at least 1 year in the city. • At least 1 year at the given residence address ( In case of transfer from other location with less than 1 year at current location - please provide relevant documents to the bank during loan approval stage). • You have been working for at least 1 year. 56Institute of Productivity and Management
  • 57. • You have a phone at your residence or office.Documentation Required:Applying for a Two Wheeler Loan is absolutely simple.All you need is: • Proof Of Identity : Any one of Passport Copy/ Photo Credit card- front & reverse/ Voters ID card/ Driving Licence/ PAN card/ Copy of Company ID card of MNC/ Public Ltd./ PSU/ Govt. company/ Ration Card (If Photo is given). • Address Proof : Any one of Passport Copy/ Voters ID card/ Driving Licence/ Rental agreement/ Telephone Bill/ Electricity bill/ Gas Connection Bills/ Ration Card/ Sale deed/ Property purchase agreement/ Credit Card billing statement (latest)/ LIC policy/ Letter from Company or Company provided Accommodation (List of the companys as per the Banks List- ID card of MNC/ Public Ltd.,/ PSU/ Govt. Company Containing the residence address), Address proof in the name of the applicants Spouse or parents name is acceptable. • Income Proof For Salaried : Latest Salary slip for Govt. employees; If Salary slip is not available, Only salary certificate to be accepted with deductions, For Partnership/ Proprietary firms & Pvt. Ltd. Cos- Salary Certificate to be accepted with the following mitigates: Salary Certificate to clearly state the deductions, Name & Designation of the authorized signatory. For Self-Employed - Copy of the latest I. T. return.Fees & Charges for Two Wheeler Loans:Description of Charges Two Wheeler LoansLoan Processing Charges Maximum - 4% of Loan Amount or Rs.600/- whichever is higherPre-payment charges Within 1 year from 1st EMI - 6% of principal oustanding 13-24 months from 1st EMI - 5% of principal oustanding Post 24 months from 1st EMI - 3% of principal oustanding No foreclosure allowed within 6 months from date of availing the Two Wheeler loanNo Due Certificate / No Objection NilCertificate (NOC)Duplicate no due certificate / NOC Rs 250/- 57Institute of Productivity and Management
  • 58. Solvency Certificate NACharges for late payment of EMI 2.5% Per Month on the Unpaid InstallmentCharges for changing from fixed to NAfloating rate of interestCharges for changing from floating to NAfixed rate of interestStamp Duty & other charges As per applicable laws of the stateCredit assessment charges Upto Rs.750/-Non standard repayment charges Rs 250/-Outstation clearing charges Rs 25/- per chequeCheque swapping charges Rs 500/-Loan cancellation / re-booking charges Rs 1000/-Bounce Cheque Charges Rs 450/-Duplicate Repayment Schedule Rs 500/-chargesLegal, Repossession & Incidental At actualchargesDirect Sourcing Charges Upto Rs.750/- per vehicleTransaction Fee for Suraksha Kavach Rs 100/- per Cover Note IssuedService Charges Rs 50/-Special NOC Rs. 500/- per request • New Car Loan:Features & Benefits: • Covers the widest range of cars and multi-utility vehicles in India. • Avail 100% finance on your favorite car. • Flexible repayment options, ranging from 12 to 84 months. 58Institute of Productivity and Management
  • 59. • Borrow up to 3 times your annual salary (for salaried professionals) and 6 times your annual income (for self employed professionals). • Speedy processing - within 48 hours. • Repay with easy EMIs. • Attractive car loan plans - To Fastrack your loan, just choose the plan that is right for you. • Attractive Interest rates. • Hassle-free documentation. • Customer Privileges o If you are an HDFC Bank account holder, we have special rates for you. o If you have had a Preferred Account or a Corporate Salary Account with HDFC Bank for more than six months, you can get fast approvals on your loans with minimal documentation. o If you are an existing HDFC Bank Car Loan customer with a clear repayment of 12 months or more we can Top-Up your car loan to the extent of the original loan value.Best Guide to Car Segments and Funding: Segment Ex-Showroom Funding % Examples Value (In lac)A:Mini <=2.15 80-100 Maruti 800B:Compact 2.2-4.5 90-100 Alto, Swift, Indica, Santro, Getz, Estillo, A- Star, Palio, i10C:Mid-Size 4.5-10.0 75-100 i20, Accent, Swift ,Dzire, Honda City, Honda Jazz, Verna, SX4, Linea, Ikon, Fusion, Optra, Fabia, IndigoD:Executive 9.5-16.0 75-95 Toyota Corolla, Civic, Skoda Ocatvia, Hyundai Elantra, Optra MagnumD+:Premium 16.0-25.0 75-90 Honda Accord, Camry, Hyundai Sonata, 59Institute of Productivity and Management
  • 60. Skoda Laura, Superb, Passat, Jetta, Teana, Fiat 500D+: Luxury 25.0+ 75-85 Mercedes, BMW, Audi, Porche and all other importedMUV 2.20+ 75-90 Omni, Innova, Xylo, Scorpio, Tavera, Bolero, Victa, SafariSUV 14.0+ 75-85 CR-V, Endeavour, Pajero, Montero, X-Trail, Prado, Tucson, Captiva, Grand Vitara, Mitsubishi OutlanderFunding range is indicative. Pre-approved customers could get up to 100% ex-showroom funding in segmentsA-D. • Used Car Loan:Features & Benefits:  Choose any car manufactured in India within a certain age.  Borrow up to 80% of the value of the car.  Flexible repayment options, ranging from 12 to 60 months.  Borrow up to 3 times your annual salary (for salaried professionals) and 6 times your annual income (for self employed professionals).  Available for almost all car models at attractive interest rates.  Repay with easy EMIs.  Additional loan on existing loan - If you are a existing HDFC Bank Auto loan customer with a clear track record of 12 months or more, then you can get an additional loan to the extent of your existing loan amount at attractive rate of interest.  Customer Privileges  Special benefits for HDFC Bank account holders. 60Institute of Productivity and Management
  • 61.  If you have had a Preferred Account or a Corporate Salary Account with HDFC Bank for more than six months, you can get fast approvals on your loans with minimal documentation.Fees & Charges for Used Car Loans:Description of charges Used Car LoansFC Charges 6% of POS for preclosures within 1 year from 1st EMI 5% of POS for preclosures within 13-24 months from 1st EMI 3% of POS for preclosures post 24 months from 1st EMI No foreclosure allowed within 6 months from date of availing the car loan.Stamp Duty At actualLate Payment Penalty 2% per monthProcessing fees Used cars -2% of loan amount or Rs.5000/-, whichever is lower Car-n-cash / Balance Transfer - 2% of Loan amount or Rs.4000/-, whicever is lowerAgri /PSL Charges Rs 2000Cheque swapping charges Rs 500/-Loan cancellation / re-booking charges Rs 1000/-Duplicate Repayment Schedule charges Rs 500/-Legal, Repossession & Incidental charges At actualDuplicate no due certificate / NOC Rs 500/-Transaction fees for Suraksha Kavach Rs 500/- per caseLoan Reschedulement charges As applicable at the time of re schedulementSpecial NOC Rs. 500/- per request • Commercial Vehicle Loan:Loans are extended for the purchase of: 61Institute of Productivity and Management
  • 62. Commercial Vehicles - Loans for commercial vehicles (this includes buses, trucks, tempos,tippers), LCVs (light commercial vehicles, HCVs (heavy commercial vehicles), MCVs (mediumcommercial vehicles) and three wheelers.Funding for all models of Telco, Ashok Leyland, Swaraj Mazda, Eicher, Bajaj Tempo, Volvoetc.Type of loans: • New Vehicles • Used Vehicle / Refinance • Balance Transfer • Top-Up loansAdvantages: • Up to 100% financing. • Upto 48 months tenor • Simpler documentation • Quick processing. • Customised EMI structure.Fees & Charges for Commercial Vehicle Finance:Description of charges Commercial Vehicles FinanceCheque bouncing charges Rs. 450FC Charges 4 % of POS for preclosures with 1 year from 1st EMI 2% of POS for preclosures after 1 year from 1st EMI 62Institute of Productivity and Management
  • 63. Stamp Duty At actualsLate Payment Penalty 2% per month on unpaid EMIProcessing fees New Loans: 1.50% of the Loan Amount 3 Wheelers / Used Loans - 1.5% of the Loan AmountService Charges 1.5% of the Loan AmountValuation charges Used Vehicles only - At actualsAsset verification charges At ActualsCheque Swaping charges Rs. 500/- per swapRebooking charges Rs. 2000/-Loan Cancellation charges Rs. 2000/- applicable from 1st May 2007.Loan Reschedulement charges 0.25% on the Amount paid towards principal loanLegal/Collection/Repossession and At ActualsIncidental chargesTransaction / Other Fees for Non PDC up to Rs. 50/- per cheque leaf (Non Refundable)cases applicable from 29 Sep08.Special NOC Rs. 500/- per request • Tractor Loan:Features & Benefits: • Covers a wide range of tractors manufactured in India. • Covers customer segments, using tractors for agricultural as well as commercial purposes. • Avail finance up to 85 % on your favorite tractor • Flexible repayment options ranging from 12 - 84 months. • Speedy processing. 63Institute of Productivity and Management
  • 64. • Repay with easy PDCs or by way of cash collection. • Attractive interest rates. • Hassle Free documentation.Eligibility & Documentation: • For Farmers • For Non FarmersFor FarmersEligibility Criteria:  Land Requirement - 5 acres of irrigated or 10 acres of un-irrigated land.  Minimum age of the applicant - 18 years.  Maximum age of the applicant - 60 years on the date of funding.  Income - Not less than 1 Lac per annum.Documents required:  Proof of Identity - Passport Copy / PAN card/ Voters ID / Driving licence / Self affidavit with photograph of customer and signature across duly notarised / Photocopy of the bank pass book front page giving name, address photograph of the customer attested by the bank / photo of customer attested by the banker on a separate paper.  Latest Land records :- Not to be more than 3 months old.  Address Proof - Copy of land extracts / ration card / Akarni Patrak / Property card / tax receipt /Talati or Patwari or VAO certificate certifying that the applicant is a resident of the village. 64Institute of Productivity and Management
  • 65.  Signature proof - Copy of driving licence / Copy of PAN card / self affidavit with photograph of customer and signature across duly notarised / Present Banker verification Bank statement for last 6 months if availableFor Non FarmersEligibility Criteria:  Minimum age of Applicant: 18years  Maximum age of the applicant – 60 years on the date of funding  Income - Not less than 1 Lac per annum.  Telephone - Owned / PP (Land line or Mobile) is mandatoryDocuments required:  Proof of Identity - Passport Copy / PAN card/ Voters ID / Driving licence / Photocopy of the bank pass book front page giving name , address photograph of the customer attested by the bank / photo of customer attested by the banker on a separate paper.  Address Proof:- Electricity bill / municipal tax receipt / Society bill / Agreement Copy / telephone bill .  Signature proof :Copy of driving licence / Copy of PAN card / Present Banker verification Certified true copy of partnership deed / Memorandum & articles of association in case of partnership firms and limited companies respectively  Bank statement for last 6 ,copy of repayment track for vehicle (not older than 1 year) , income papers i.e. IT returns / Contract papers ,copy of work/transport contracts, if anyCustomer can enjoy the option to avail finance on 1year or 1st, 2nd & 3rd year combined motorinsurance premium with Credit Shield."Credit Shield" would cover the insurance for accidentaldeath or permanent total disability of the customer and will cover amount equivalent tooutstanding in loan account. 65Institute of Productivity and Management
  • 66. Fees & Charges for Tractor Loans:Description of charges Tractor LoansPre-payment Charges 4% if before 12 months from date of disbursement 2 % if after 12 months from the date of disbursementStamp Duty At actualsLate Payment Penalty 2% per month on unpaid instalmentsProcessing fees 2%Cheque swapping charges Rs. 500/- per swap per instanceLoan cancellation / re-booking charges Rs. 1000/-Loan re-schedulement for part payment 3%Bounce Cheque Charges Rs. 450 /- per instrument per instanceDuplicate Repayment Schedule charges Rs. 500/-Legal, Repossession & Incidental charges At actualDuplicate no due certificate / NOC Rs. 250/-Transaction Fee for Tractor Plus Rs 500 per caseDocumentation Charges ( For Agri Rs. 1500/-Mortgage Cases) 66Institute of Productivity and Management
  • 67. Balance Sheet of HDFC Bank Ltd. (last 5 years) --------------------------------in crores---------------------------------------------------- Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 12 mths 12 mths 12 mths 12 mths 12 mthsCapital and Liabilities:Total Share 309.88 313.14 319.39 354.43 425.38CapitalEquity Share 309.88 313.14 319.39 354.43 425.38CapitalShare 0.43 0.07 0.00 0.00 400.92ApplicationMoneyPreference 0.00 0.00 0.00 0.00 0.00Share CapitalReserves 4,209.97 4,986.39 6,113.76 11,142.80 14,226.43Revaluation 0.00 0.00 0.00 0.00 0.00ReservesNet Worth 4,520.28 5,299.60 6,433.15 11,497.23 15,052.73Deposits 36,354.25 55,796.82 68,297.94 100,768.60 142,811.58Borrowings 5,290.01 4,560.48 2,815.39 4,478.86 2,685.84 67Institute of Productivity and Management
  • 68. Total Debt 41,644.26 60,357.30 71,113.33 105,247.46 145,497.42Other 5,264.46 7,849.49 13,689.13 16,431.91 22,720.62Liabilities &ProvisionsTotal 51,429.00 73,506.39 91,235.61 133,176.60 183,270.77Liabilities Mar 05 Mar 06 Mar 07 Mar 08 Mar 09 12 mths 12 mths 12 mths 12 mths 12 mthsAssets:Cash & 2,650.13 3,306.61 5,182.48 12,553.18 13,527.21Balances withRBIBalance with 1,823.87 3,612.39 3,971.40 2,225.16 3,979.41Banks, Moneyat CallAdvances 25,566.30 35,061.26 46,944.78 63,426.90 98,883.05Investments 19,349.81 28,393.96 30,564.80 49,393.54 58,817.55Gross Block 1,290.51 1,589.47 1,917.56 2,386.99 3,956.63Accumulated 582.19 734.39 950.89 1,211.86 2,249.90DepreciationNet Block 708.32 855.08 966.67 1,175.13 1,706.73Capital Work 0.00 0.00 0.00 0.00 0.00In ProgressOther Assets 1,330.57 2,277.09 3,605.48 4,402.69 6,356.83Total Assets 51,429.00 73,506.39 91,235.61 133,176.60 183,270.78 68Institute of Productivity and Management
  • 69. Contingent 84,585.95 138,898.60 202,126.73 582,835.94 396,594.31LiabilitiesBills for 5,342.70 5,239.26 7,211.88 17,092.85 17,939.62collectionBook Value 145.86 169.24 201.42 324.38 344.44(Rs) 69Institute of Productivity and Management
  • 70. SECTION B PROJECT PROFILEThe project “ANALYSIS OF HDFC LAONS IN BAREILLY” gave an opportunity to getpractical experience and corporate exposure through which a lot was learned about loans. Thisproject is based on research in which there was a need to find out that whether peopleare taking loans from HDFC or not and reasons behind both taking and not taking loans,which age group of people are more taking, which type of loan people prefer to take,which mode of payment they prefer one-time or EMI’s. This project helped a lot in makingpeople aware of loans and which type of loans people prefer more so that they could be 70Institute of Productivity and Management
  • 71. benefited by it. This analysis was done on 150 individuals in Bareilly. The primary data will becollected through questionnaire. The questionnaires consist of two parts:First parts consist of customer demographics, which include age group, gender marital status andProfession. This part will help in knowing which age group has more capacity according towhich market could be trapped, it will also help in knowing whether males or females are moreinterested in taking loans. The second part of the questionnaire will help in knowing whetherpeople are aware of various loans schemes, from which institution they prefer to take loan,people are more comfortable with EMI’s, one time payments etc. In the second part we also getto know one important thing about customers whether they prefer loans or not and if they preferwhich type of loans they are taking etc. This project will give an idea about the current scenarioas to what customers prefer today. It will help in clearing the doubts of customers after knowingas to why they don’t prefer loans. This way more information can be made available to themwhich will increase the awareness about loans and therefore more people can enjoy the benefitsof loan. WHY THIS PROJECT WAS UNDERTAKEN:This report will provide different types of value addition to the organization as given below:-  Customer views on loans, which were being offered by bank according to their needs.  The facilities that the customer of loan is getting.  HDFC Bank will come to know the areas, where it needs to improve. 71Institute of Productivity and Management
  • 72.  The bank will also come to know what additional facilities are being provided by its competitors on loans.  The main aim of this project is find out the market standard of HDFC’s loan when compare to its competitors such as ICICI Bank, Axis Bank, SBI etc.  Through this project I can find out that on what grounds the loan provided by HDFC is different from its competitors.  Project helps in creating good relationship and helps in solving the problems of the customers.  This project helps in creating new customers and maintaining the existing customers by providing maximum services. PROBLEM ENVIRONMENT:The main problem was lack of awareness about various loans schemes that the bank is offering, majorityof the people are unaware about these schemes. If the behavioral aspects of the people are taken intoaccount then while conducting the survey most of the people were not ready to answer the entirequestionnaire. Awareness level services offered by HDFC Bank is pitiable, respondents who had taken aswell as not taken loan are not aware about the product and services of HDFC Bank.WHAT DOES BANK EXPECTS TO DO BY SOLVINGTHE PROBLEM?  The Bank expects to find out the knowledge level of customer of different loans.  The bank expects to find out which age groups of people are more interested in taking loans. 72Institute of Productivity and Management
  • 73.  The bank also expects to find out in which Bank the customers prefer to take loan from. This will help the bank in knowing the level of competition that exists.  The bank expects to find out which are the best services that they can provide to there customers.  The company expects to find out whether the customer prefer in one time payments or EMI’s. 73Institute of Productivity and Management
  • 74. SECTION C RESEARCH DESIGN Define research problem 74Institute of Productivity and Management
  • 75. Design Strategy [Type purpose, time frame, scope] Data collection Define analysis & interpretation Research Report Management Decision 75Institute of Productivity and Management
  • 76. RESEARCH METHODOLOGYResearch in common parlance refers to search for knowledge. Once can also define research asa scientific and systematic search for pertinent information on a specific topic. In fact ,researchis an art an science of investigation .Redman and Moray define research as a“systematized effort to gain knowledge” some people define research as a voyage ofdiscovery ,we all possess the vital instinct of inquisitiveness for when the unknownconfronts us , we wonder and our inquisitiveness makes us probe and attain full andfuller understanding of the unknown The inquisitiveness is the mother of all theknowledge and the method , which the man employs for obtaining the knowledge ofwhatever the unknown ,can be termed as research. Research comprises defining andredefining problems, formulating hypothesis or suggested solutions; collecting, organization andevaluating data; making deductions and reaching conclusions, and at last carefully testing theconclusions to determine whether they fit the formulating hypothesis. Research methodologyconsiders the logic behind the methods we use in the context of our study and explain why weare using a particular method or technique and why we are not using others so that researchresults are capable of being evaluated either by the researcher himself or by others. Researchmethodology is a way to systematically solve the research problem. It may be understood as ascience of studying how research is done. RESEARCH PROBLEMThe research problem was to know the position of HDFC Bank loan in Bareilly. OBJECTIVE OF RESEARCHTo find out which type of loan for what duration is being preferred by the customer or public. RESEARCH SUBOBJECTIVE • To know why or why not customers/public prefer loans. • To find out the most preferable loans taken by the customers. 76Institute of Productivity and Management
  • 77. • To find what all are the requirements/services needed by the customers. • To find out how Bank can influence a customer to take loan. • This project helps in creating new customers and maintaining the existing customers by providing maximum services. • Solving the problems of the customers. • The bank will also come to know what additional facilities that customer wants.SCOPE OF THE STUDYGeographical scopeCustomers of Bareilly.Duration of Study:The study was carried out for a period of two months, from 01st May to 2nd July 2010. RESEARCH DESIGNResearch Design is the conceptual structure within which research is conducted. It is basicallythe blueprint for the collection of data, measurement of analysis of data. A Research Design isthe arrangement of conditions for collection and analysis of data in a manner that aims tocombine relevance to the research purpose with economy in procedure. A good research designhas following characteristics:Problem Definition Specific method of data collection and analysis Time required for research project My research design is of diagnostic type. Diagnostic research studies determine the frequency with which something occurs. 77Institute of Productivity and Management
  • 78. RESEARCH INSTRUMENT USED:In this project questionnaire method is used to collect data due to following reasons:-Written questionnaires are more cost effective as the number of research questions increases. Questionnaires are easy to analyze. Data entry and tabulation for nearly all surveys can be easily done with many computer software packages. Questionnaires are familiar to most people. Nearly everyone has had some experience completing questionnaires and they generally do not make people apprehensive. Questionnaires reduce biasness. There is uniform question presentation and no middleman biasness. The researchers own opinions will not influence the respondent to answer questions in a certain manner. There are no verbal or visual clues to influence the respondent. Questionnaires are less intrusive. DATA COLLECTIONThe task of data collection begins after a research problem has been defined and researchdesign/ plan chalked out. While deciding about the method of data collection to be used for thestudy, two types of data are used.a. Primary Data Primary data are those which are collected a fresh and for the first time and thus happen to be original in character.ADVANTAGES:-  get comprehensive and original information  convenient to respondents  information are primary modeDISADVANTAGES:- 78Institute of Productivity and Management
  • 79.  often takes much time  info may be incomplete  need to be quite clear about what looking forb. Secondary Data Secondary data on the other hand are those which have already been collected by someone else and which have already been passed on. The data is collected, formulated and processed keeping in mind the twin object of understanding the existing social welfare and social security scheme and to derive out the result from the employer / employee session. Samples are chosen at random basis.ADVANTAGES  Doesn’t interrupt program or client’s routine program  Information already exist  Less costlyDISADVANTAGES  Information may be incomplete.  Not flexible means to get data, data restricted to what already exists.  Used only primary data for which a comprehensive questionnaire was prepared and was filled by the individuals.PRIMARY SOURCES  PERSONAL INTERVIEWINGThis method is used when we want to understand someone’s buying behavior pattern, or learnabout his or her answer to questionnaires.SECONDARY SOURCES  Data collected through internet.  The facts sheets of different banks.  Used many website such as (HDFC BANK, ICICI BANK, SBI BANK). 79Institute of Productivity and Management
  • 80.  Many magazines such as outlooks, business magazines, etc  Data collected from newspaper such as business standards, economic times.SCHEDULE METHODThis method of data is quite popular. A questionnaire consists of a number of questions printedin definite order on a form. The respondents’ have an answer them on there own, constructedquestionnaire containing 22 questions each related to objective of the project.Advantages:These responses are gathered in a standardized way, it is in close-ended and open-ended form.Disadvantages:  Questionnaires are standardized so it is not possible to explain any points in the questions that participant might misinterpret.  Respondents may answer superficially especially if the questionnaire takes a long time to Complete.  Respondents may not be willing to answer the questions. They might not wish to reveal the information or they might think that they will not benefit from responding perhaps even be penalized by giving their real opinion.SAMPLING DESIGN:A sampling design is a definite plan for obtaining a sample from a given population. It refers tothe technique or the procedure the researcher would adopt in selecting items for the sample.Simple design is determined before data are collected. The sample size should also beascertained before starting the research program. The larger the sample sizes the better andaccurate will be the result.Defining the PopulationThe first step in good sample design is to ensure that the specification of the targetpopulation is as clear and complete as possible to ensure that all elements within the 80Institute of Productivity and Management
  • 81. population are represented. The target population is sampled using a sampling frame.Often the units in the population can be identified by existing information; for example,pay-rolls, company lists, government registers etc. A sampling frame could also begeographical; for example postcodes have become a well-used means of selecting asample.Sample Size = 150For any sample design deciding upon the appropriate sample size will depend on severalkey factors(1) No estimate taken from a sample is expected to be exact: Any assumptions aboutthe overall population based on the results of a sample will have an attached margin oferror.(2) To lower the margin of error usually requires a larger sample size. The amount ofvariability in the population (i.e. the range of values or opinions) will also affect accuracyand therefore the size of sample.(3) The confidence level is the likelihood that the results obtained from the sample liewithin a required precision. The higher the confidence level that is the more certain youwish to be that the results are not atypical. Statisticians often use a 95 per cent confidencelevel to provide strong conclusions.(4) Population size does not normally affect sample size. In fact the larger thepopulations size the lower the proportion of that population that needs to be sampled to berepresentative. It is only when the proposed sample size is more than 5 per cent of thepopulation that the population size becomes part of the formulae to calculate the samplesize. 81Institute of Productivity and Management
  • 82. FIELD WORKThe field work is done in the area of HDFC BANK LTD., Civil Lines in the cityBareilly. The questionnaires to the customers at the following places in Bareilly: • PUBLIC SECTOR BANKS • PRIVATE SECTOR BANKS • GENERAL PUBLICSAMPLING TECHNIQUES USEDFor the particular research study, used the following two types of Sampling i.e. SamplingTechniques. 1. CONVENIENCE AND JUDGEMENT SAMPLING 2. SIMPLE RANDOM SAMPLING1) CONVENIENCE and JUDGEMENT SAMPLING:This method is quite helpful as one can consider the sample according to the convenience.Under convenience sampling technique the sample units are chosen on the basis of researchersconvenience of location, travel, time, cost etc. The sampling technique used for the survey ofcustomer was convenience of sampling.Advantages:  Easy to organize  Quick 82Institute of Productivity and Management
  • 83. Disadvantages:  There is no guarantee that the behaviors of these people represent behaviors of other groups.2) SIMPLE RANDOM SAMPLINGIn this type of sampling, where each and every item in the population has an equal chance ofinclusion in the sample. The each item an equal probability of being selected.Advantages:  Simple to design and interpret.  Can calculate estimate of the population and the sampling error  Analysis of data is reasonably easyDisadvantages:  Need a complete and accurate population listing  May not be practical if the sample requires lots of small visits all over the country. Analytical Tools UsedData presented in the form of: Pie charts, percentage calculation.LIMITATION OF THE STUDY:- Some of the persons were not so responsive. Since the sample for the study consist the public and customers of bank in Bareilly, generalization may not be accurate. Further the validity and generalization of the results may hold good only for Bareilly. 83Institute of Productivity and Management
  • 84.  The chance of simple random error may prove to be limitation as respondent may not to give accurate information and even student bias while collecting the data should be considered. Questionnaire used as the only instrument of the primary data. SECTION D 84Institute of Productivity and Management
  • 85. Data Analysis (1) Age group? Age group No. of Respondents Percentage <=30yrs 36 24% 31-35yrs 52 35% 36-40yrs 26 17% 41-45yrs 15 10% 45-50yrs 12 8% >50yrs 9 6% Total 150 100% 85Institute of Productivity and Management
  • 86. INTERPRETATION:- This chart depicts that between the age group of 31-35are the major loan taker. This is because between this age group have lesserliability therefore are more risk taking and like to take loan to fullfill there goals inshort term or as soon as possible.(2)Gender? Gender No. of Respondents Percentage Male 112 75% Female 38 25% Total 150 100% 86Institute of Productivity and Management
  • 87. INTERPRETATION:- This graph depict that 75% are male and only 25% arefemale to take loan this is because majority of the female believes in saving moneyor not ready to take any liability , therefore very few of the females take loan.(3)Martial Status? Martial Status No. of Respondents Percentage Single 38 25% Married 112 75% 87Institute of Productivity and Management
  • 88. Total 150 100%INTERPRETATION:- This chart depicts that married person takes more loanthan single because married person want to make himself settle as soon as possibleso that he can enjoy all his facility during his young age and make his old agemore comfortable.(4) Occupation/Profession? Occupation/Profession No. of Percentage Respondents 88Institute of Productivity and Management
  • 89. Businessman 21 14% Govt. Service 17 11% Pvt. Service 50 33% Professional 31 21% Student 15 10% Agriculture 13 9% Others 3 2% Total 150 100%INTERPRETATION:-This chart depicts that Pvt. Employees and Professional take moreloan because businessman has its own business so he tries to take out money from its profit.Government service people are not aware about loan schemes. While agricultural persons,students and others don’t have fixed, stable income so they try to avoid loan.(5) Educational Qualification? Educational Qualification No. of Respondents Percentage 89Institute of Productivity and Management
  • 90. Graduation/PG 114 76% Under graduation 24 16% Others 12 8% Total 150 100%INTERPRETATION:- This chat depicts that 76% of the total sample size isgraduate or post graduate. It means that they know about different types of loanschemes and know about there liabilities.(6) Income? 90Institute of Productivity and Management
  • 91. Income No. of Respondents Percentage Rs. 10000-20000 16 11% Rs. 20001-30000 20 13% Rs. 30001-40000 63 42% Rs. 40001-50000 33 22% >Rs. 50000 18 12% Total 150 100%INTERPRETATION:- From the above chart we can see that 42% of the totalpopulation having income between Rs-30000 to 40000 per month. While 76% ofthe total population is above Rs-30000 per month. So chances of taking loan ismore because these people try to achieve there goals in short duration. 91Institute of Productivity and Management
  • 92. (7) Prefer Loan? Prefer Loan No. of Respondents Percentage Yes 96 64% No 54 36% Total 150 100%INTERPRETATION:- From the above chart we can see that 64% are ready totake loan or they have taken loan. While 36% do not prefer loan. 92Institute of Productivity and Management
  • 93. 8) Don’t Prefer Loans?Some People don’t prefer loan because • Want to achieve their goal by saving their money. • Not ready to take liability on their shoulder. • Not ready to pay interest on that amount or extra cost. • Not ready to waste there time in paper work or any extra work related to loan. 93Institute of Productivity and Management
  • 94. (9) Aware of Loan Schemes? Awareness No. of Respondents Percentage Electronic Media 22 15% Friends & Relatives 32 21% Banks 63 42% Newspapers & Magazines 27 18% Others 6 4% Total 150 100%INTERPRETATION:- This chart depicts that bank contributes 42% in makingaware about the loan schemes to the people. While friends and relative contributes 94Institute of Productivity and Management
  • 95. about 21% and news paper & magazines contributes only 18% in making awareabout the loans. While electronic media and other sources contributes only 19%.(10) Other Places Providing Loans? Places No. of Respondents Percentages Banks 114 76% Financial Institutions 30 20% Others 6 4% Total 150 100%INTERPRETATION:- As we know that there are various sources of taking loanbut in over survey we found that 76% of the total sample like to prefer loan from 95Institute of Productivity and Management
  • 96. bank and while 20% would like to take it from financial institutes and only 4%would like to take it from other sources.(11) Banks that are most preferred by the customers for takingLoans? Banks No. of Respondents Percentage HDFC 47 31% ICICI 40 27% Kotak Mahindra 15 10% Mahindra & Mahindra 8 5% Public Banks 37 25% Others 3 2% Total 150 100% 96Institute of Productivity and Management
  • 97. INTERPRETATION:- This chart depicts that population prefer for taking loan -31% from HDFC, 27% from ICICI bank, 10% Kotak bank, 5% Mahindra &Mahindra,25% from public bank, 2% from others.(12) Frequency of taking Loans? Frequency No. of Respondents Percentage Once a year 53 36% Every two years 35 23% Three and above 62 41% Total 150 100% 97Institute of Productivity and Management
  • 98. INTERPRETATION:- This chart depicts that 41% of the total population wouldlike to take 3 to 4 time loan in a year it is personal loan which is for short duration.It can be 15days to 91 days. While 36% percent like to take loan once in a year and23% would like to take loan once in two year. Interest paid in loan gets taxdeduction in section 24(i).(13) Interest Rate? Interest Rate No. of Respondents Percentage Fixed 40 27% Floating 65 43% Special Interest rate schemes 45 30% Total 150 100% 98Institute of Productivity and Management
  • 99. INTERPRETATION:- This chart shows that 43% would like to take floatinginterest, 27% prefer fixed interest and while 30% prefer special interest ratescheme on their loans.(14) Term Loan? Term No. of Respondents Percentage Short-term 71 47% Medium-term 31 21% Long-term 48 32% Total 150 100% 99Institute of Productivity and Management
  • 100. INTERPRETATION:- This chart shows as that 47% prefer short term loan (lessthan 1year), while 32% prefer long term loan (more than 5 year), 21% prefermedium term loan.(15) Duration of Payment? Duration of Payment No. of Respondents Percentage EMI’s 64 43% One time Payment 17 11% NPDC’s 33 22% Six months installments 21 14% Three months installments 13 9% Others 2 1% Total 150 100% 100Institute of Productivity and Management
  • 101. INTERPRETATION:- From the above chart we can see that 43% population liketo have EMI facility. While 22% like to have NPDC, 11% prefer onetime paymentsystem, 14% prefer six months installments system, and 9% prefer three monthsinstallments system, only 1% prefers other modes of making payments. This chartconclude that maximum number of people prefer installment system.(16) Customer of HDFC bank? Customer of HDFC bank No. of Respondents Percentage Yes 87 58% No 63 42% Total 150 100% 101Institute of Productivity and Management
  • 102. INTERPRETATION:- This chart depicts that 58% are the customers of the bankwhile 42% are not the customers of bank but in future they will become thecustomer of the bank.If No, Why? • Branch is not near to there location. • They think that private bank charges are higher than public bank. • Few people have certain fixed mentality that private bank can run any time. 102Institute of Productivity and Management
  • 103. • Private Banks have very strict rules for loans and account.(17) Awareness of HDFC Loans? Awareness of HDFC No. of Respondents Percentage loans Yes 108 72% 103Institute of Productivity and Management
  • 104. No 42 28% Total 150 100%INTERPRETATION:- From the above chart we can see that 72% are awareabout different types of loan and schemes that HDFC bank gives. While 28% areunaware about the loans and schemes that HDFC offers.If No, Why? • They are not interested in taking loans 104Institute of Productivity and Management
  • 105. • They are not interested in taking loan from private banks because they due to high interest rates. • Lots of furred can be done with the customers. • HDFC Bank is not flexible according to the customers need and wants.(18) Type of Loan? 105Institute of Productivity and Management
  • 106. Type No. of Respondents Percentage Two-wheeler 20 13% Car Loan 29 19% Gold Loan 3 2% Commercial-vehicle Loan 15 10% Personal Loan 12 8% Educational Loan 17 11% Working capital finance 6 4% Home Loan 31 21% Loan against property 13 9% Others 4 3% Total 150 100% 106Institute of Productivity and Management
  • 107. INTERPRETATION:- This chart depicts that 13% likes two-wheeler loans, 19%likes car loans, 2% like gold loan, 10% likes commercial-vehicle loan, 8%likepersonal loan, 11% likes educational loan, 4% likes working capital loan, 21%likes home loan, 9% likes loan against property, 3% likes other types of loan. 107Institute of Productivity and Management
  • 108. (19) Why Customers choose HDFC for taking Loans? • It is easy to take loan from HDFC bank • Bank believes on its ethics and commitment. • Less fraud records with customers. • Best schemes available. • Easily convertibility between fixed interests to floating interest. • Fewer charges charged to the customers in comparison to the other private banks and financial institutions. 108Institute of Productivity and Management
  • 109. (20) Factors that customer keep in mind while choosing Loans? Factors No. of Respondents Percentage A trusted name 27 18% Accessibility 19 13% Easy policies 48 32% Friendly services & 56 37% responsiveness Total 150 100%INTERPRETATION:- This chart shows that 18% believes on trust name, 13%believes on accessibility 32% believes on policies and 37% believes on friendlyservices and responsiveness. 109Institute of Productivity and Management
  • 110. (21) Timely giving information regarding change in services &interest rate on certain policies? Information No. of Respondents Percentage Timely information given 106 71% Not updated 44 29% Total 150 100%INTERPRETATION:- This chart shows that 71% are happy that they areinformed timely about the changes made in their loan contracts. While due someproblems 29% are not been able to get properly informed about the changes intheir loan contracts. 110Institute of Productivity and Management
  • 111. (22) Satisfaction of customers? Satisfaction of customers No. of Respondents Percentage Highly satisfied 64 43% Satisfied 54 36% Dissatisfied 17 11% Highly dissatisfied 11 7% Can’t say 4 3% Total 150 100%INTERPRETATION:- This chart depicts 43% customers are highly satisfied,36% are satisfied, 11% are dissatisfied, 7% are highly dissatisfied and 3% areaverage it means they can’t say any. 111Institute of Productivity and Management
  • 112. ConclusionThe project opportunities provided was market segmentation and identifying prospectivecustomers in potential geographical location and convincing them to take loan so that newbusiness opportunities of the bank can be explored. Through this project, it could be concludedthat people are not much aware about the various products of the bank.As we know that HDFC bank is the oldest and number one bank in giving loan. As the surveywas done in Bareilly I have found that age above 31 are the most loan takers because they wantto fulfill there life goals in less time and they prefer floating rate of interest and they also preferEMI facility for paying back the loan. There are various other people who are ready for takingloan but they need some awareness from the bank. The bank provides various types of loansaccording to the needs of the customers. Bank should conduct some seminars, contest, etc formaking aware about the different types of loans, special interest rate schemes and some excitingoffers. This will help the bank in increasing customers and creating the good relationship withexisting customers.So, at last the conclusion is that there is tough competition ahead for the company from itsmajor competitors in the banking sector.Last but not the least I would like to thank HDFC Bank for giving me an opportunity to work inthe field of Finance. I hope the company finds my analysis relevant. 112Institute of Productivity and Management
  • 113. SuggestionsFinally some recommendations for the bank are as fallows:-  To make people aware about the benefit of becoming HDFC Bank’s Customer following activities of advertisement should be done through: • Print Media. • Hoarding & Banners. • Stalls in Trade Fares • Distribution of leaflets containing details information.  Minimum balance for savings account should be reduced from Rs 5000, so that people who are not financially strong enough can maintain their account properly.  Make people understand about the various benefits of its products by conducting some seminars.  Bank should organize the program in the society, so that people will be aware about the bank and different products of the bank.  It should maintain the image of transparency and should also create trust among all the present customers.  The younger people of age group <=30 will be a key new customer group into the future, so making greater efforts with these people who show some interest in various schemes in banks.  Launch innovative schemes in the market to attract the customers. 113Institute of Productivity and Management
  • 114. QuestionnaireQ1) Age group? A) <=30 yrs B) 31-35 yrs C) 36-40 yrs D) 41-45 yrs E) 45-50 yrs F) >50 yrsQ2) Gender? A) Male B) FemaleQ3) Marital status? A) Single B) MarriedQ4) What is your Occupation/Profession? A) Businessman B) Govt. service C) Private sector D) Student E) Professionals F) Agriculture G) othersQ5) What is your Educational Qualification? A) Graduation/PG B) Under Graduate C) OthersQ6) What is your income? A) Rs.10000-20000 B) Rs. 20001-30000 C) Rs. 30001-40000 D) Rs.40001-50000 E) >Rs. 50000Q7) Do you prefer loan? A) Yes B) NoQ8) Why don’t you prefer Loan?Q9) How you get aware about various Loan Schemes? A) Electronic Media B) Friends & Relatives C) Banks 114Institute of Productivity and Management
  • 115. D) Newspapers & Magazines E) OthersQ10) From where do you prefer to take Loan? A) Banks B) Financial Institutions C) OthersQ11) Which Bank you prefer taking loan from? A) HDFC B) ICICI C) Kotak Mahindra D) Mahindra & Mahindra E) Public Banks F) OthersQ12) Frequency of taking Loans? A) Once a year B) every two-three years C) three & above yearQ13) Which interest rate do you prefer taking? A) Fixed B) Floating C)special interest rate SchemeQ14) Which term of loan you prefer? A) Short-term B) Medium-term C) Long-termQ15) Which is preferable duration for payment? A) EMI’s B) one time payment C) NPDC’s D) six months installments E) three months installments F) OthersQ16) Are you customer of HDFC? A) Yes B) NoIf No than why?Q17) Are you aware of HDFC Loans? 115Institute of Productivity and Management
  • 116. A) Yes B) NoIf No than why?Q18) Which type of loan you have taken from HDFC/ planning to take? A) Two-wheeler Loan B) Car loan C) Gold loan D) Commercial vehicle loan E) Personal loan F) Educational Loan G) Working capital finance H) Home loan I) Loan against Property J) OthersQ19) Why you have chosen HDFC for taking Loans?Q20) Factors that you keep in mind while choosing the loan? A) A trusted name B) Accessibility C) Easy Policies D) Friendly services & responsivenessQ21) Timely giving information regarding change in services & interest rate on certain policies? A) Timely information given B) Not updatedQ22) Are you satisfied with the bank/loan you have chosen? A) Highly satisfied B) satisfied C) Dissatisfied D) Highly dissatisfied E) Can’t sayName:-________________________ 116Institute of Productivity and Management
  • 117. Annexure 117Institute of Productivity and Management
  • 118. Bibliography  Books: • Marketing Research & Research Methodology: - C.R. Kothari. • Principles of Marketing:- Philip Kotler  Newspapers:  Economic Times  Business Standard  Websites:  www.hdfcbank.com  www.google.com  www.wikipedia.org  www.economictimes.com  www.timesofindia.com  www.businessstandard.com 118Institute of Productivity and Management
  • 119. Thank You 119Institute of Productivity and Management
  • 120. 120Institute of Productivity and Management

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