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SUMMER TRAINING PROJECT REPORT ON

CREDIT CARD AND LOAN ASSESSMENT

FOR THE PARTIAL FULFILLMENT OF THE

REQUIREMENT

FOR THE AWARD OF

DEGREE OFMASTER OF BUSINESS

ADMINISTRATION

(2009-2011)

Submitted to: Submitted by:

Dr. Harinder Singh Gill Rimple bamba

HOD PG Studies MBA 3rd SEM

90032265822

DEPARTMENT OF MANAGEMENT STUDIES AD

COMPUTER APPLICATIONS

AMRITSAR COLLEGE OF ENGINEERING & TECHNOLOGY,

AMRITSAR



2

CERTIFICATE

This is to certify that the project work doneon CREDIT CARDS AND LOANASSESSMENT is a bonafide work carried outby Ms.RIMPLE BAMBA under mysupervision and guidance. The project

report is submitted towards the partialfulfillment of 2 ² year, full time PostGraduate Degree in Management.The original work was carried during 10TH JUNE to 25TH JULY in AXISBANK,AMRITSAR.

Name & Sign of Industry GuideDate:



3

ACKNOWLEDGEMENT

´ For any successful work, it owes its thanks to manyµ

Summer training is one of the most vital and active part of the curriculum of

management students. I did the work as a management trainee at AXIS Bank.

Hard work, knowledge, dedication & positive attitude all are necessary to do

any task successfully but one ingredient which is also very important than

others and at times more important than others is cooperation & guidance of

experts and experienced person .

Firstly I would like to extend my heartfelt gratitude to Mr. Amit Makhija

the Branch Manager, for his guidance throughout the project. Without his

support and cooperation I would have failed in my endeavours and targets inthe summer training.

I emphatically express the regards and gratitude towards my speculative guide

Dr.Harinder Singh gill for his expert and invaluable guidance, constant

encouragement, and constructive criticism to accomplish such laborious and

exhaustive work timely and perfectly.

I would also like to thank all the Staff of Axis Bank, Amritsar for their

invaluable suggestion and cooperation to complete my project success.

Rimple bamba



4

DECLARATION

I, Ms. RIMPLE BAMBA hereby declare that this

project report is the record of authentic work

carried out by me during the period from 10TH

JUNE to 25th JULY and has not been submitted to

any other University or Institute for the award

of any degree / diploma.

Signature

Name of the student

Date



5

PREFACE

When I¶m working on a problem, I never think about beauty. I think

only how to solve the problem, but when I have finished, if the

solution is not beautiful, I know it is wrong.´

I have pleasure in presenting the final project report on ³Credit cards

and loan assessment´`. I am grateful to the scholars of the ACET for

their kind appreciation. In this project I have studied the problems and

perception of people of Amritsar regarding credit cards and loan

assessment. I have added the various types of credit cards and loan

assessment of Axis bank .I am grateful to the Mr . Amit Makhija for

assist me in my final project report

RIMPLE BAMBA



6

CONTENTS

Serial No. Particular Page No.

1 Certificate From Organisation

2 Certificate by head of institute

3 Acknowledgement

4 Declaration

5 Preface

4 Chapter 1 9Introduction-banking in India 10

About axis bank 16

6 Chapter 2 25

Review of literature 26

Chapter 3 56

Research methodology 57

7 Chapter 4 59

Data analysis and interpretation 59

Easy Credit Card 60

Variants 61

Pricing 61

8 Process 64

Documentation 67Loan Assessment 68

1. Home Loan 68

Documentation 69

Interest Rate 70



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2. Personal Loan 71

Normal Salaried Individual 71

Salaried Professional 72

Salaried Doctor 73Documentation 74

Interest Grid 75

Particular

3. Loan Against Property 75

Salaried Individual 75

Professional 76

Self Employed Individual 77

Documentation 78

Interest Grid 80

4. Auto Loan 81

Category Grid 81

Salaried Employee 82

Self Employed 83

Partnership 84

Private and public limited company 85

Documentation 86

Interest Rate 88

5. Agriculture Loan 89

Commodity Power-(Warehouse

Receipt financing)

90

Agricultural Gold Loan ¶Power Gold· 95

Power Gold Plus 99

Kisan Power 100

Direct Financing to Farmers for CattleLoans through Dairies/ Cooperatives

111



8

Direct Financing to Farmer UnderContract Farming

116

6. Education Loan 121

9 Chapter 5 124

Findings 125

10 Chapter 6 130

Suggestions/recommendations 131

11 Chapter 7 134

Conclusion 135

Glossary 136

Appendix/Annextures 141Bibliography 145



9

CHAPTER 1

INTRODUCTION



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INTRODUCTIONBanking In India: Overview:

anking in India originated in the first decade of 18th century. The first banks

were The General Bank of India, which started in 1786, and Bank of

Hindustan, both of which are now defunct. The oldest bank in existence in

India is the State Bank of India, which originated in the "The Bank of Bengal"

in Calcutta in June 1806. This was one of the three presidency banks, the

other two being the Bank of Bombay and the Bank of Madras. The presidency

banks were established under charters from the British East India Company.

They merged in 1925 to form the Imperial Bank of India, which, upon India's

independence, became the State Bank of India. For many years the Presidency

banks acted as quasi-central banks, as did their successors. The Reserve Bank

of India formally took on the responsibility of regulating the Indian banking

sector from 1935. After India's independence in 1947, the Reserve Bank was

nationalized and given broader powers.

B

Other Nationalized

Banks

RESERVE BANK OF INDIA Central Bank and supreme monetary authority

Non Scheduled Banks

Foreign

Banks

Private

Sector

SBI &

Associates

Regional Rural

Banks

Urban

Cooperatives

State

Cooperatives

Scheduled Banks

Cooperative

Public

Sector

Commercial



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Early History:

he first fully Indian owned bank was the Allahabad Bank, established in 1865.

However, at the end of late-18th century, there were hardly any banks in

India in the modern sense of the term. The American Civil War stopped the

supply of cotton to Lancashire from the Confederate States. Promoters

opened banks to finance trading in Indian cotton. With large exposure to

speculative ventures, most of the banks opened in India during that period

failed. The depositors lost money and lost interest in keeping deposits with

banks. Subsequently, banking in India remained the exclusive domain of

Europeans for next several decades until the beginning of the 20th century.

Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The

Comptoire d'Escompte de Paris opened a branch in Calcutta in 1860, and

another in Bombay in 1862; branches in Madras and Pondichery, then a

French colony, followed. Calcutta was the most active trading port in India,

mainly due to the trade of the British Empire, and so became a banking

centre.

The Bank of Bengal, which later became the State Bank of India.

Around the turn of the 20th Century, the Indian economy was passing

through a relative period of stability. Around five decades had elapsed since

the Indian Mutiny, and the social, industrial and other infrastructure had

improved. Indians had established small banks, most of which served

particular ethnic and religious communities.

T



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farmers. Fourteen banks were nationalized in 1969. Before 1969, State Bank

of India (SBI) was the only public sector bank in India. SBI was nationalized in

1955 under the SBI Act of 1955. The second phase of nationalization of Indian

banks took place in the year 1980. Seven more banks were nationalized with

deposits over 200 crores.

List of Public Sector Banks in India is as follows:

Allahabad Bank State Bank of India (SBI)

State Bank of Indore State Bank of Mysore

State Bank of Patiala

State Bank of Saurashtra State Bank of Travancore Syndicate Bank

UCO Bank Union Bank of India

United Bank of India s Vijaya Bank

Andhra Bank Bank of Baroda

Bank of India Bank of Maharashtra

Canara Bank Central Bank of India

Corporation Bank Dena Bank

Indian Bank Indian Overseas Bank Oriental Bank of Commerce Punjab and Sind Bank

Punjab National Bank State Bank of Bikaner & Jaipur

State Bank of Hyderabad

Private Banks in India:

ll the banks in India were earlier private banks. They were founded in the

pre-independence era to cater to the banking needs of the people. But after

nationalization of banks in 1969 public sector banks came to occupy dominant

role in the banking structure. Private sector banking in India received a fillip

in 1994 when Reserve Bank of India encouraged setting up of private banks as

A



14

part of its policy of liberalization of the Indian Banking Industry. Housing

Development Finance Corporation Limited (HDFC) was amongst the first to

receive an 'in principle' approval from the Reserve Bank of India (RBI) to set

up a bank in the private sector.

Private Banks have played a major role in the development of Indian banking

industry. They have made banking more efficient and customer friendly. In

the process they have jolted public sector banks out of complacency and

forced them to become more competitive.

List of Private Sector Banks in India is as follows:

Bank of Rajasthan Bharat Overseas Bank

Axis Bank Catholic Syrian Bank

Centurion Bank of Punjab Dhanalakshmi Bank

Federal Bank HDFC Bank

ICICI Bank IDBI Bank

IndusInd Bank ING Vysya Bank

Jammu & Kashmir Bank Karnataka Bank

Karur Vysya Bank Kotak Mahindra Bank

SBI Commercial and International Bank South Indian Bank

United Western Bank YES Bank



15



16

About AXIS:

Start on 1994

On July 2007 UTI Bank rebrand as Axis Bank

Axis Bank was the first of the new private banks to

have begun operations in 1994, after the Government

of India allowed new private banks to be established.

The Bank was promoted jointly by the Administrator of

the specified undertaking of the Unit Trust of India (UTI

- I), Life Insurance Corporation of India (LIC) and

General Insurance Corporation of India (GIC) and other

four PSU insurance companies, i.e. National Insurance

Company Ltd., The New India Assurance Company Ltd.,

The Oriental Insurance Company Ltd. and United India

Insurance Company Ltd.

The Bank today is capitalized to the extent of Rs.

407.44 crores with the public holding (other than

promoters and GDRs) at 54.51%.

The Bank's Registered Office is at Ahmedabad and its

Central Office is located at Mumbai. The Bank has a

very wide network of more than 1042 branches

(including 56 Service Branches/CPCs as on 30th June

2010). The Bank has a network of over 4474 ATMs (as

on 30th June 2010) providing 24 hrs a day banking

convenience to its customers. This is one of the largest

ATM networks in the country.



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The Bank has strengths in both retail and corporate

banking and is committed to adopting the best industry

practices internationally in order to achieve excellence.

Mission and Values:

Customer Service and Product Innovation tuned to diverse needs

of individual and corporate clientele.

Continuous technology up gradation while maintaining human

values.

Progressive globalization and achieving international standards.

Efficiency and effectiveness built on ethical practices.

Customer Satisfaction through providing quality service effectively

and efficiently.

"Smile, it enhances your face value" is a service quality stressed on

Periodic Customer Service Audits.

Maximization of Stakeholder value.

Success through Teamwork, Integrity and People.



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Vision 2015 and Core Values

VISION 2015:

To be the preferred financial solutions provider

excelling in customer delivery through insight,

empowered employees and smart use of technology

Core Values

Customer Centricity

Ethics

Transparency

Teamwork

Ownership

Capitalization:

359 crore

Public Holding = 57.60%



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Registered Office:

Ahmadabad

Central Office:

Mumbai

Total Branches:

827

ATM:

3595

Board of Directors

The members of the Board are :

Dr. Adarsh Kishore Chairman

Smt. Shikha Sharma Managing Director & CEO

Shri M. M. Agrawal Deputy Managing Director

Shri J.R. Varma Director

Dr. R.H. Patil Director

Smt. Rama Bijapurkar Director

Shri R.B.L. Vaish Director

Shri M.V. Subbiah Director

Shri K. N. Prithviraj Director

Shri V. R. Kaundinya Director

Shri S. B. Mathur Director

Shri M. S. Sundara Rajan Director



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Bank Strengths:

Retail Banking

Corporate Banking

Auditors:

M/s. S. R. Batliboi & Co. Auditors Chartered Accountants

Registrar and Share Transfer Agent:

M/s. Karvy Computershare Private Limited

Profile:

Axis Bank is one of the fastest growing banks in the country and has an

extremely competitive and profitable banking franchise evidenced by:

Comprehensive portfolio of banking services include Corporate Credit, Retail

Banking, Business Banking, Capital Markets, Treasury and International

Banking.

The Position as on 31st March 2009 was as under: -

Balance Sheet Size Rs 1,47,722 crore Total Deposits Rs 1,17,374 crore Net Advances Rs 81,557 crore Investments Rs 46,330 crore



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Net NPA 0.35% Capital Adequacy Ratio 13.69% %

Axis Bank has in place a sound technological platform:Sound technological platform with centralized database and operations

enabling 24*7*365 ¶Anywhere Banking·, in order to render the best customer

service to its 5.5 million customer base.

Competitors:

Private Sector competitors:HDFC

ICICI

Public Sector competitors:

SBI

PNB

Retail Banking:

The Bank continued with its thrust on customer segmentation in the retail

liabilities business to spearhead growth during the financial year 2008-09.

Savings Bank deposits grew to Rs. 25,822 crores on 31st March 2009 from

Rs. 19,982 crores as on 31st March 2008 showing a year on year growth of

29%.

Corporate Banking:

The Business Banking Department (Erstwhile Institutional Business

Department) was set up in the year 2000, with the objective of having a

special cell to serve the institutional and corporate clientele of the Bank.



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Business Banking initiatives revolve around transaction banking services to

garner Business Current Accounts, Cash Management Service mandates,

Government Business - Collection & Payment Services. As a natural corollary,

scope of the business was extended this year to Business loans for Small

Businesses so that all product and services to small business enterprises are

comprehensively made available.

The Department presently focuses on the four broad areas through

the respective Business Groups, as under:

Business Current Accounts

Business Assets

Cash Management ServicesGovernment Business

Corporate Credit:

Current Account deposits grew by 24% yoy, from Rs. 20,045 crores as at end

March·08 to Rs. 24,822 crores as at end March·09. The daily average Current

Axis

bank

PERSONAL

BANKING

CORPORATE

BANKING

NRI

PRIORITY

BANKING



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Account balances over the year grew by 24% yoy. The Corporate Credit

portfolio of the Bank comprising advances to large and midcorporates grew by

68.33% to Rs. 29,026 crores from Rs. 17,244 crores a year ago. This includes

advances at overseas branches amounting to Rs. 5,381 crores (equivalent to

USD 134 million) comprising in main the portfolio of Indian corporates and

their subsidiaries, as also trade finance. Credit exposures are taken based on

risk analyses and mitigation measures, with proposals being subjected to

critical scrutiny by the Bank's Risk Department. Efforts are made to constantly

upgrade the skills required for faster turnaround of credit proposals and

structuring of financial products. In addition to working capital loans, the

Bank also takes long-term exposures to infrastructure and manufacturing

projects set up by reputed industry groups. Relationship groups in the Bank

are organised with an industry sector focus for better evaluation of specified

risks. The credit policy of the Bank has also put in place ceilings on exposures

to various industries with a view to containing concentration risk and

facilitating portfolio diversification.

Financial Performance:

Profit after tax up 69% to Rs.1,815.36 crores.

Net Interest Income up 43% to Rs.3686.21 crores.

Other Income up 61% to Rs.2,896.88 crores.

Fee Income up 64% to Rs.2,447.35 crores

Deposits up 34% to Rs.1,17,374 crores.

Demand Deposits up 37% to Rs.50644 Crores.

Advances up 61.79% to Rs.81,557 crores .



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LITERATURE REVIEW

Background :

I have done my training from Axis Bank, Amritsar Branch. I learned there

working and functioning of the bank. Axis bank is one of the fastest growing

banks in India and has extremely competitive and profitable banking franchise.

Axis bank is the first new generation private sector bank to be established in

India under the overall reform programme initiated by Government of India

in 1991.Axis bank started its operation from 1994.

BUSINESS DESCRIPTION:

The Bank's principal activities are to provide commercial banking

services which include merchant banking, direct finance,

infrastructure finance, venture capital fund, advisory, trusteeship,

forex, treasury and other related financial services. The Bank has 463

branches and 263 extension counters throughout India. During April,

2006 the Bank open-end 1 overseas branch in Singapore.

PROMOTERS:

UTI Bank Ltd. has been promoted by the largest and the best

Financial Institution of the country, UTI. The Bank was set up with a

capital of Rs. 115 crore, with

UTI contributing Rs. 100 crore,

LIC - Rs. 7.5 crore

GIC and its four subsidiaries contributing Rs. 1.5 crore each.



27

Promoters: Unit Trust Of India (UTI)

Life Insurance Corporation (LIC) General Insurance Corporation (GIC)

National Insurance Company Limited

New India Assurance Company Limited

The Oriented Insurance Company Limited

United India Insurance Company Limited

SUUTI SHARE HOLDINGS-27.33%

Erstwhile Unit Trust of India was set up as a body corporate under the

UTI Act, 1963, with a view to encourage savings and investment. In

December 2002, the UTI Act, 1963 was repealed with the passage of

Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 by

the Parliament, paving the way for the bifurcation of UTI into 2

entities, UTI-I and UTI-II with effect from 1st February 2003.

SHARE HOLDING PATTERN:

AS ON 25-05-07

Sr.

No.

Name of the

Shareholders

No. of Shares Held % Stake

to Total

A. Promoter Shareholding

1 Administrator of the

Specified Undertaking of

the Unit Trust of India

(UTI - I)

7,72,45,070 27.33



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2 Life Insurance Corporation

of India

2,92,22,936 10.34

3 General Insurance

Corporation of India and

four PSU Insurance

Companies.

1,49,26,224 5.28

Total Promoter Shareholding A 12,13,94,230 42.95

B. Non-Promoter Holding

4 Indian Financial

Institutions (IFIs)

3,24,084 0.12

5 Mutual Fund 2,36,82,394 8.38

6 Others

(Individuals/Corporate

Bodies/HUF/Trusts/Banks)

2,39,26,557 8.46

Total Non-Promoter Indian

Shareholding B

4,79,33,035 16.96

C. Foreign Shareholding

7 FDI Route GDR Issue 1,11,62,661 3.95

8 Foreign Financial

Institutions (FIIs)

10,16,51,067 35.96

9 NRIs/OCBs 5,08,786 0.18

Total Non-Promoter Foreign

Shareholding C

11,33,22,514 40.09

Total A+ B + C 28,26,49,779 100



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COMPANY PROFILE: AXIS BANK

Axis Bank India, the first bank to begin operations as new private

banks in 1994 after the Government of India allowed new private

banks to be established. Axis Bank was jointly promoted by the

Administrator of the specified undertaking of the

Unit Trust of India (UTI-I)

Life Insurance Corporation of India (LIC)

General Insurance Corporation Ltd.

Also with associates viz. National Insurance Company Ltd., The New

India Assurance Company, The Oriental Insurance Corporation and

United Insurance Company Ltd.

Axis Bank in India today is capitalised with Rs. 232.86 Crores with

47.50% public holding other than promoters. It has more than 200

branch offices and Extension Counters in the country with over 1250

Axis Bank ATM proving to be one of the largest ATM networks in

the country. Axis Bank India commits to adopt the best industry

practices internationally to achieve excellence. Axis Bank has

strengths in retail as well as corporate banking. By the end of

December 2004, Axis Bank in India had over 2.7 million debit cards.

This is the first bank in India to offer the AT PAR Cheque facility,

without any charges, to all its Savings Bank customers in all the

places across the country where it has presence.

With the AT PAR cheque facility, customers can make cheque

payments to any beneficiary at any of its existence place. The ceiling



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per instrument is Rs. 50,000/-.The latest offerings of the bank along

with Dollar variant is the Euro and Pound Sterling variants of the

International Travel Currency Card. The Travel Currency Card is a

signature based pre-paid travel card which enables traveler¶s global

access to their money in local currency of the visiting country in a safe

and convenient way. The Bank has strengths in both retail and

corporate banking and is committed to adopting the best industry

practices internationally in order to achieve excellence

DETAILED DESCRIPTION OF PRODUCTS AND SERVICES:

PERSONAL ACCOUNTS:

PRIME SAVINGS ACCOUNT

Axis Bank, we have always strived to pace our products with the

growing needs of our customers. The Prime Savings account has

therefore been created with your specific financial requirements

in mind.

y Wider Accessibility: 500 branches and one of the largest

ATM networks in India.

y Greater Convenience: International Debit Card with

withdrawal limit of Rs 40,000 per day facilitating transfer

of funds, deposits of cash/cheques and payment of

insurance premium (LIC).

y More Comfort: 24 hr Internet Banking and Tele Banking

services



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y Enhanced Privileges: provide you a passbook and

monthly statement of account to keep you updated on all

your transactions

y Added Speed: 'At Par' cheque facility, you have the

unique advantage to encash your cheques as a local

cheque at more than 330 centers where the bank has a

presence at no extra cost

Other Accounts in this category:

SALARY POWER

SMART PRIVILEGE ACCOUNT

SENIOR PRIVILEGE

PENSION SAVINGS ACCOUNT

DEPOSITS

Fixed Deposits

Axis Bank offers a simple reinvestment Fixed Deposits (at very

competitive interest rates), which can be opened with a

minimum investment of Rs 10,000.

Reinvestment Deposits:

In a reinvestment deposit, the interest accrued to your deposit

at the end of each quarter is invested along with the principal.

The tenure of your deposit must be a minimum of 6 months.

Automatic Rollover:

As a Fixed Deposit holder, you can avail of the facility for

automatic rollovers on maturity (for both the principal and



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interest). You can select this option in the Account Opening

Document (AOD). The options available are:

RECURRING DEPOSITS

Power of compounding

Axis Bank's Recurring Deposit scheme will allow you with an

opportunity to build up

Your savings through regular monthly deposits of fixed sum

over a fixed period of time.

Features:

Recurring deposits are accepted in equal monthly installments

of minimum Rs 1,000 and

Above in multiples of Rs 500 thereafter . The fixed number of

installments for which a

Depositor can opt are 12, 24, 36, 39, 48, 60, 63, 72, 84, 96, 108and 120 months.

Transfer of Accounts - a recurring deposit account can be

transferred from one office of

the Bank to another branch.

Encash 24

The ENCASH 24 (Flexi Deposits) gives you the liquidity of a

Savings Account coupled

with high earnings of a Fixed Deposit. This is achieved by

creating a Fixed Deposit



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linked to your Savings Account providing you the following

unique facilities.

LOANS

POWER HOUSE:

Axis Bank's Power Home puts an end to your Real Estate

troubles.

Features:

y Attractive interest rates

y Balance Transfer facility

y Doorstep service

y Option to choose from floating rate or fixed rate Free Property

& Personal accident insurance.

PERSONAL POWER:

Features:

y Loans for salaried and self employed individuals

y Special loans for doctors, chartered accountants, engineers,

architects, CS and ICWA .

y Loans are available from Rs 50,000 to Rs 20 lacs

y Repayment tenures from 12 to 60 months

y Attractive interest rates Free personal accident insurance cover

with personal loan

y Loans can be used for any purpose with no questions asked

regarding the end use of the loan A balance transfer facility

available for those who want to retire any higher cost debt



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Loans available against repayment track record of any existing

auto, personal or home loan Loans available against proof of life

insurance policy or premium receipts

y Zero balance SB account facility for personal loan customer¶s

Simple procedure, minimal documentation and quick approval.

ASSET POWER (Loan Against Property)

A take-over of your existing loan with refinancing is also possible

with Asset Power .

Features

Attractive interest rates

Balance Transfer facility available with additional finance

Doorstep service

Four products under Asset Power

Loan against property - Residential

Loan against property - Commercial

Loan for purchase of commercial property

Take-over of existing loan with additional refinance (Balance

Transfer)

Lease Rental Discounting (LRD)

CORPORATE BANKING

Working Capital Finance



35

. These products are designed to ease the liquidity position of the

client and come with a number of other facilities such as Internet

Banking, Phone Banking etc.

Trade Services

Axis Bank has emerged as one of the leading banks in providing

trade finance services, providing a gamut of products for both

exports and imports, with dedicated Front-Desk and Specialists,

speedy processing of documents and provide comprehensive and

timely MIS.

Structured Finance

Axis Bank provides tailor made solutions to meet our clients'

requirements, while mitigating the credit and price risk at the

same time.

Supply Chain Management

Axis Bank provides integrated commercial and financial

solutions to the supply and distribution channels of a corporate.

The products are designed to add value to supply and

distribution channels by providing unique solutions to meet their

working capital requirements.

CAPITAL MARKETS

Debt Solutions

Axis Bank is a leading provider of debt solutions in the form of bond

or debenture issuances and loan syndication. The Bank has

successfully managed various debt issuances of mid and large size

which includes plain vanilla loans or bonds, and structured term loans



36

to meet the specific requirements of the clients and the projects. The

Bank is the largest bond house in the country and has been ranked first

in respect of various domestic and international league tables in

respect of domestic debt issuances.

Equity Solutions

We are SEBI registered Category I Merchant Banker . The Bank's

Capital Markets Department has developed significant expertise in the

area of public or rights issue management, private placement of

equity, overseas fund raising through FCCB and GDR and debt

syndication.

The Bank has acted as Lead Book Running Managers, co-arrangers

and advisors to a number of equity issuances or offers.

Trusteeship Services

Axis Bank Ltd. is a SEBI registered Debenture Trustee in the business

of Debenture Trusteeship, Security Trusteeship, Monitoring Agencyand Facility Agency and predominantly acts as Trustee to privately

placed debt issuances, domestic borrowings and external commercial

borrowings.

At present the aggregate value of the Trusteeship portfolio is

approximately Rs 1, 00,000 crores. The Trusteeship Group presently

services over 150 clients including leading public and private sector

corporate as well as Banks and Financial Institutions including

international funding agencies in respect of various debt instruments

issued within the country and also for various secured Foreign

Currency Convertible Bonds and External Commercial Borrowings.



38

values that he or she perceives and ready to pay for . The brand can be

associated with superior product, superior services, superior sales after

services, or easy access. In today's era with increasing competition, is

that not important enough to revisit Brand as a marketing offering

(Product or Service).

BRAND NAME:

UTI has officially announced the change of its name to µAxis Bank¶.

The awareness campaign titled µUTI Bank is now Axis Bank;

everything is the same except the name¶, has been created by O&M

and is the brainchild of Sumanto Chattopadhyay.

The decision to re-brand the bank emanated from the need to move

out of a scenario of brand confusion that is created by several

shareholder-unrelated entities using the UTI brand. On the creative

point of view, the change of name from UTI Bank to Axis Bank isprecisely just a name change. Everything else about the brand remains

the same. Axis is a strong name with an international aura to it. It is

very much in keeping with UTI¶s success story in the private banking

arena.

MARKETING INITIATIVES:

On the marketing initiatives, a multimedia campaign was unfolded on

August 1 that will go on for the next few weeks. It seeks to reassure

customers that the change of name will in no way affect the services

offered by the bank .

On the thought process the creative platform adopted for the name



39

change is based primarily on twins -- siblings whose names are

different, but are identical in every other way. This campaign will run

on

Television

Outdoor

Print

Radio and other 360-degree media.

Some interesting innovations are planned in the print medium. On

radio, the name change is being expressed in a slightly different

manner, in keeping with the nature of the medium.

BROADSHEET WAY:

The first campaign that was featured was a false cover page for Mid-

Day going the broadsheet way. The campaign very much focused on

the idea on the awareness of the bank changing its name to µAxis

Bank¶.

Television is given priority as it gives the maximum reach among the

mass media channels. Besides the mass media channels, the 2,500-odd

ATM locations is also being used to convey the name change

message. And of course, the signages of the 600 or so branches will

also change to reflect the new name.

LOGO DESIGN:

The logo design of Axis Bank is based on the letter µA¶. It is a

contemporary, universal and solid design that retains the burgundy

color of the original UTI logo as a link to its heritage



41

Name of the

Bank

Market

Cap

Total

Asset Net Sales Net Prof it

All val es in Cr

ICICI B K 99,998.52 560,607.22 22,994.29 3,110.22

HD C B K 39,473.02 141,941.13 6,889.02 1,141.45

AXIS BANK 22,071.89 119,388.42 4560.4 659.03

KO AK

MAHINDR A 26,041.18 30,866.31 1354.1 141.37

YES BANK 5,220.60 6,728.34 190.18 55.32

JK BANK 3,668.88 49,435.44 1,899.33 274.49

EDER AL

BANK 2,987.01 34,371.98 1,436.53 225.21

K AR NATAK A

BANK 2,262.76 27,445.55 1,256.25 177.03

CENTUR ION

BANK 6,002.76 31,711.06 1,256.25 121.38

INDUS IND 1,624.63 30,039.04 1,188.28 38.81

C i of t top 10 pr i t banks :

On t basis of t ir market Capitali ation

47%

13%

11%

3%

3%

2%

1% 1%1%

Market Cap (Rs. cr)

ICICI B

¡

¢

HDFC B

¡

¢

£

ot

¢

Mahindra

Axis Bank

Centurion Bank

Yes Bank

JK Bank



42

On t e basis of t eir Total Assets:

On t e basis of t eir Net Prof it:

On t e basis of t eir Sales:

53%

¤ 3%

¤ ¤ %

5%

3%

3%3%

3% 3% 3%

Total Assets

ICICI Bank

HDFC Bank

Axis Bank

JK Bank

Federal Bank

ING Vysya Bank

Centurion Bank

Kotak Mahindra

IndusInd Bank

Karnataka Bank

51%

19%

11%

5%

4%

3% 3%

2%

2% 1%

Net Profit (Rs.Cr)

ICICI Bank

HDFC Bank

Axis Bank

JK Bank

Federal Bank

Karnataka BankKarur Vysya

Kotak Mahindra

Centurion Bank



43

COMPETETIORS

1. ICICI Bank Ltd.

2. HDFC Bank Ltd.

3. State Bank of India

4. HSBC Bank

5. R BS (R oyal Bank of Scotland)

6. Maharashtra Bank of India

7. Canara Bank

8. A ndhra Bank

9. IDBI bank

10. Bank of India

11. Punjab National Bank

12. Central Bank

13. A llahabad Bank

14. ING Vysya

15. Centurion Bank

GOVERNMENT REGULATION IN BANKING:

53%

16%

11%

4%

3%

3%3%

3%

3% 0%

N t S l s s C

I ¥ I ¥ I ¦ ank

§ ̈ F ¥ ¦ ank

©

xis

ank

J

ank

Fe

e

al

ank

ak Mahindra

¥ en

ri n ¦ ank

arna

aka¦

ank

Ind sInd ank



44

Banking Regulation Act, 1949

As per Section 5(c) of Banking Regulation Act, 1949 a "Banking

Company" means any company which transacts the business of

banking in India.

Any company which is engaged in the manufacture of goods or

carries on any trade and which accepts the deposits of money

from public merely for the purpose of financing its business as

such manufacturer or trader shall not be deemed to transact the

business of banking within the meaning of this clause."

As per Section 5(b) of Banking Regulation Act, 1949 , banking

means the accepting, for the purpose of lending or investment, of

deposits of money from the public, repayable on demand or

otherwise, and withdrawals by cheque, draft, order or otherwise.

As per Section 5(d) of Banking Regulation Act, 1949, company

means any company as defined in Section 3 of the Companies

Act, 1956 and includes a foreign company within the meaning of

Section 591 of that Act.

As per section 51 of Banking Regulation Act, 1949, certain

provisions of the Banking Regulation Act are also applicable to

the State Bank of India, any corresponding new bank, a regional

rural bank and any subsidiary bank . "Corresponding new bank"

has been defined under clause (ee) of section 2 of the DICGC

Act to mean a corresponding new bank constituted under the

Banking Companies (Acquisition and Transfer of Undertakings)

Acts of 1970 or 1980.



45

National Housing Bank Act, 1987

Section 2(d) of the National Housing Bank Act, 1987 defines a

housing finance institution as under :

"Housing finance institution includes every institution, whether

incorporated or not, which primarily transacts or has as one of its

principal objects, the transacting of the business of providing finance

for housing, whether directly or indirectly"

Reserve Bank of India Act, 1934

Section 2(d) of the National Housing Bank Act, 1987 defines a

housing finance institution as under

"Financial Institution" means any non-banking institution which

carries on as its business or

y the acquisition of shares, stock, bonds, debentures or securities

issued by a government or local authority or other marketable

securities of a like nature;

y

letting or delivering of any goods to a hirer under a hire-purchase agreement as defined in clause (c ) of section 2 of the

Hire-Purchase Act, 1972;

y the carrying on of any class of insurance business;

the financing, whether by way of making loans or advances or

otherwise, of any activity other than its own;



49

This has resulted in a substantial growth of retail banking business

during 2005-06

The thrust on customer segmentation has been a strategic success, as

evident from the strong business growth across various customer

segments during 2005-06.

ATM:

The Bank has also continued its earlier pioneering efforts in

persuading other banks to participate in ATM sharing, and presently

offers the largest available access to over 18,000 ATMs in the country

to its customers, based on alliances with other banks and multi-bank

shared payment

Networks. The Bank has also provided value additions on its versatile

ATM machines, including LIC premium payment and telephone bill



50

payments

for service providers like MTNL and BSNL, as also mobile banking

services and mobile refill facilities for Airtel, Hutch, Orange and Idea

cellular service providers. The Bank has tied up with UTI Mutual

Fund to launch a new service that will help customers of the Bank to

subscribe as well as redeem UTI Mutual Fund schemes through the

Bank¶s nationwide network of 1,891

ATMs.

The Bank¶s future thrust is on:

marketing approach

product innovation

risk management systems

Financial Advisory

Rigorously designed back-office processes contribute to the

strength of the Bank¶s retail lending strategy

Wealth Advisory Services



51

INTERNATIONAL BANKING

The Bank continued to provide a business focus on tapping business

from the NRI community by offering a wide range of banking,

investment and advisory services to them. During the year, the

aggregate NRI deposits grew by 48.37% from Rs. 1,134.87 crores to

Rs.1, 683.84 crores with the NRI savings bank balances growing by

115.90% from Rs. 295.79 crores to Rs. 638.60 crores. During the

same period, the number of savings bank NRI accounts grew by

82.61% from 27,018 to 49,337. The accelerated growth, both in terms

of account acquisition and savings bank balances of NRI business, is

attributable to

Initiatives that have focused on deepening of existing

relationships and a simultaneous expansion of the customer

base, driven by alliances with various banks and exchange

houses in the Gulf region.

The Bank has also partnered with the Ministry of Overseas

Indians to offer an Internet based electronic remittances portal to

facilitate remittances from NRIs. The portal also provides

information services relating to investments in financial

markets, tax consultancy and investments in real estate.

Globalisation of financial markets across economies and the

significant increase in international trade in recent years

provides opportunities for the Bank to render banking and

related services through a presence in overseas centers.



54

Portfolio management services,

Capital market related services.

Future Strategies:

Project advisory services with a focus on infrastructure and other

core sectors.

Financial advisory skills with technical advisory skills by

forming alliances.

The Bank also maintains an investment and proprietary trading

portfolio in corporate bonds and equities.

SAILIENT FEATURES:

Today 14.6% of our customers are registered for mobile

banking. The Bank aims to be a significant player in the cards

business.

The debit card base of the Bank grew to 40 lacs during the year

from 30.3 laces.

The Bank was the first Indian bank to introduce the travel

currency card, a foreign denominated pre-paid card, which is

positioned as a convenience alternative to the travelers¶ cheque.

The card is issued in five currencies:

U.S. Dollar,

Australian Dollar,

Canadian Dollar,

Pound Sterling

Euro on the VISA flag platform.



55

During 2005-06, foreign currency sales by the Bank through the

travel currency card exceeded US Dollars 63 million.

The Bank is also the first to introduce

Remittance Cards, which changes the way inward remittances,

are sent to India.

Direct remittances are facilitated via tie-ups with major Banks in

the US, U , Europe and South Asia.

Rewards Card, a pre-paid Rupee card for corporate to facilitate

quick payments to their employees, agents and distributors.

As on 31st March 2006, the Bank has installed 21,084 POS

terminals, as against 12,067 POS terminals at the end of the

previous year .

The growth of retail and consumer lending in India must be seen as

arising from a strong growth in incomes amongst the middle class and

the more affluent segments, leading to changes in consumer behavior .

As the demographically induced shift is structural rather than cyclical,

it is likely to sustain over the medium term and beyond, and

constitutes the rationale for the growth in retail lending.

Key Challenge Areas

y Highly Personalized and Customized Services.

y Personal relationship driving the business.

y Evolving Client Profile.

y Client Involvement Level.

y Passion Investment (Philanthropy and Social Responsibility).

y Limited Leveraging Capabilities of Technology (as an enabler).

y Technical Architecture and Technology Investment.

y Intricate nowledge of Cross-functional Doman



58

Research Methodology:

The method adopted to carry out this report was based on both

the primary and secondary sources.

Primary sources:

Interaction with the existing employees and deputy manager.

Personal interaction with the customers visiting to the bank.

Secondary sources:

Manuals of the bank.

Websites

Journals

Circulars



59

CHAPTER 4

DATA ANALYSIS ANDINTERPRETATION



61

Higher Cash withdrawal facility

Easier than Debit Cards

Interest free credit period of up to 50 days Higher Insurance Package

Ease of Online & MOTO transactions

Easier than O/D against FD

Interest free credit period of up to 50 days Reward Points

Complimentary Insurance

Record of transactions

Easier than Cash

Convenience of Plastic

Complimentary Insurance

Reward Points

Record of transactions

Variants:

Available in three variants:

Easy Platinum Premium (In sourcing locations only)

Easy Platinum

Easy Gold

Pricing:

Type Joining Fee Annual Fee Annual Fee Waiver

for Year 2



63

Platinum Standard Features

Low Interest Rate of 1.95% p.m.

Credit Limit of Choice High Cash Withdrawal Limit of 40% of Credit Limit

Balance Transfer Options

Easy Platinum:

Comprehensive Insurance Cover

Fuel savings of 2.5%at ALL Petrol Pumps

Attractive Rewards Program

Platinum Preferential Features:

Chip Card for Additional Security

Complimentary Priority Pass Membership

International Concierge Services

Exciting shopping offers

Standard Features:


Credit Limit of Choice

High Cash Withdrawal Limit of 40% of Credit Limit




64

Easy Gold:

Comprehensive Insurance Cover

Fuel savings of 2.5%at ALL Petrol Pumps

Attractive Rewards Program

Standard Features:


Credit Limit of Choice

High Cash Withdrawal Limit of 40% of Credit Limit


Process Simplified:

Step 1

Crédit Card Application Form

NoOnly One Single ApplicationForm

Letter of Lien

Addendum to Credit CardApplication Form

Draft Letter

Step 2

Double KYC NoSeparate KYC for Easy CreditCard

Step 3



66

Data Entry , Card & Limit Setup

No CIBIL, No FV, No TV

Dispatch

Direct to customer in Courier serviceable areas

To branch in Courier non-serviceable areas

Application Processing -New FD Customers:

Application Pickup

Easy Credit Card App Form filled

FD Form filled with KYC & PAN only by BDE/Any Branch Staff

At Branch

Sign-off by Branch head/ BSO/ BSMCPU-Mumbai

FD Data Entry

FD Account No. entered on Easy Card Application Form

CC-APU

Centralized Lien marking

Data Entry , Card & Limit Setup

No CIBIL, No FV, No TV



68

Loan Assessment:

Types of Loan:

Home loan

Personal Loan

Loan Against Property

Auto loan

Agriculture Loan

Education Loan

Home Loan:

Criteria Salaried Individual ProfessionalsSelf Employed

Individuals

Min. work exp

(Years)

2 (3 if currentemployment <1 year)

3

Min net income

(Rs.)15000pm 1.50 lacs pa

Min ~ Max age

(Years)

>24 ~ <= thansuperannuation at loan

termination>24 ~ <= 65 at loan termination



70

Passport

Latest Electricity Bill

Latest Telephone Bill

Latest Credit Card Bill.

Proof of Income:

Latest 3 salary slip showing all deductions

IT Returns

Computation of income

Balance Sheet and P/L A/c for the last 2 years certified by a C.A.

Bank Statement: Last 6 months where salary/income is credited

Proof of Qualification:

Degree / Diploma - proof of professional qualification

Interest Rate:

Home loan amount Applicable rate of interest

Up to Rs. 30 Lacks 9.00% p.a

Above Rs. 30 Lacks 9.50% p.a.



73

Min ~ Max loan amt (Rs.)

1.25 - 15 lakhs (1.25 lakh loan is onlyavailable for customers having salary powerrelationship)

Min ~ Max Tenor (months) 12 ~ 60

Security/Collateral/Guarantor Optional

Banking relationshipsCat A & B - Last 3 months

Cat C & D - Last 6 months

Phone landline / mobile / WLL mandatory

Processing fee 2% of loan amt

Eligibility calculation

Max loan =(Net monthly income -obligations) x Multiplier. Multiplier variesfrom 5 to 15 depending upon tenure.

Residence Present residence => 6 months

Degree / Diploma - proof of professional qualification

Criteria Salaried Doctors

Interest rate as per categoryDoctor in Cat B/C/D at a min of MBBS/BDS/ MS/MD = Cat B rate

Min. work exp (years) 3

Min net income (Rs. p.m.) 15,000 (gross)

Min ~ Max age >24 and <65 at loan termination



75

Interest Rate Grid:

Interest Rate Grid

Personal Loans ROI (only Fixed)

Salaried - Cat A 15.00%

Salaried - Cat B 17.00%

Salaried - Cat C 19.00%

Salaried - Cat D 21.00%

Loan against Property:

Criteria Salaried Individual

Work Experience (Years)Min 1 Year If Total Exp 2 Or (3 If CurrentEmployment <1 Yr)

Proof of ResidenceRation Card/ Passport/ Latest Electricity Bill/Latest Telephone Bill/ Latest Credit Card Bill.

Proof of Income

Latest salary slip showing all deductions and Last

2 years Form 16 along with current dated salarycertificate

Bank Statement / Pass Bookwhere salary is Credited

Cat A & B - Last 3 months, Cat C & D - Last 6months



76

Min Net Income (Rs.) 7500 Per Month

Min ~ Max Age (Years)>24 ~ <= Than Superannuation At LoanTermination

Min ~ Max Tenor

(Months)

Residential Property Up To 180 Months,Commercial Property Up To 120 Months

Maximum LTVResidential Property Up To 60%, Commercial

50%, Commercial Purchase 80%

Pre Payment Penalty

2% Will Be Charged If The Amount Exceeds 25 %Of The Principle Outstanding During A Quarter,Otherwise No Penalty.

Processing Fee 1% Of Loan Amt + Service Tax As Applicable

Takeover Of Existing

Mortgage With AdditionalRefinance

Allowed

Criteria Professionals

Work Exp (Years) Min 3 If Doctor Else 4

Min Net Income (Rs.) 1.50 Lacs Per Year



77

Min ~ Max Age (Years) >24 ~ <= 65 At Loan Termination

Min ~ Max Tenor

(Months)

Residential Property Up To 180 Months,Commercial Property Up To 120 Months

Maximum LTVResidential Property Up To 60%,Commercial 45%,Commercial Purchase 75%

Pre Payment Penalty

2% Will Be Charged If The Amount Exceeds 25% Of The Principle Outstanding During AQuarter, Otherwise No Penalty.

Processing Fee 1% Of Loan Amt + Service Tas As Applicable

Takeover Of ExistingMortgage With Additional

Refinance

Allowed

Criteria Self Employed Individuals

Work Exp (Years) Min 3

Min Net Income (Rs.) 1.50 Lacs Per Year



78

Min ~ Max Age (Years) >24 ~ <= 65 At Loan Termination

Min ~ Max Tenor(Months)

Up To 120 Months Irrespective Of Property Type

Maximum LTVResidential Property Up To 60%, Commercial45%, Commercial Purchase 70%

Pre Payment Penalty2% Will Be Charged If The Amount Exceeds 25 %Of The Principle Outstanding During A Quarter,Otherwise No Penalty.

Processing Fee 1% Of Loan Amt + Service Tax As Applicable

Takeover Of Existing

Mortgage With

Additional Refinance

Allowed

Documents required for Loan against property:

For Salaried Individual:

Proof Of Identity,

Signature & Age

Passport/ Voter's Card/ Driving License/ PANCard & Photograph.



79

Proof Of ResidenceRation Card/ Passport/ Latest Electricity Bill/Latest Telephone Bill/ Latest Credit Card Bill.

Proof Of Income Latest 3 Salary Slip Showing All Deductions

Bank Statement Last 6 Months Where Salary/Income Is Credited

Proof Of Qualification N/A

For Professionals:

Proof Of Identity,

Signature & Age

Passport/ Voter's Card/ Driving License/ PANCard & Photograph.


Proof Of Income

IT Returns, Computation Of Income, Balance

Sheet And P/L A/C For The Last 2 Years CertifiedBy A C.A.


Proof Of QualificationDegree / Diploma - Proof Of ProfessionalQualification

For Self Employed Individuals:

Proof Of Identity,Signature & Age

Passport/ Voter's Card/ Driving License/ PanCard & Photograph.



80


Proof Of Income

It Returns, Computation Of Income, Balance Sheet

And P/L A/C For The Last 2 Years Certified By AC.A.


Proof Of Qualification N/A

Other Terms & Conditions:

The property should be located within 50 km radius of nearest branch.

Properties under HUF, Properties inherited under Hindu Succession Act,

Godowns, Factories & Hospitals, Cinema Halls, Restaurants, Banquet

Halls, and Schools will not be financed under the scheme.

For Purchase of Residential Plots within Municipal / Government

Approved Layouts only Agricultural Land, Commercial Plots, Properties

Under HUF, Properties Inherited Under Hindu Succession Act, Plots

Under Litigation and Acquisition by Public Authorities will not be financed

under plot loan scheme.

Loan against property (lap) will be offered only against fully constructed

properties.

No lap will be offered against plot of land

Interest Rate Grid:

Personal Loan Interest Rate of Interest



81

Residential Property 12.75%

Commercial Property 13.75%

Auto Loan:

Category Grid

Category A Maruti 800, Omni Van, Matiz

Category B

(Upto 5 lakh)

Alto, Wagner, I10, spark, Swift, Indica Vista, Palio,

Getz, a-star, Zen

Category C

(Upto 10 lakh)

Swift Dezire, Verna, Esteem, Honda City, Acent,

Verna, Fista, Indigo CS, Optra, Scorpio,Logan



82

Category D(More Than 10 Lakh)

Safari, Corela, Endeavour, Optiva, Skoda,

Criteria Salaried

AgeMin 21 Years At Sanction To Maximum 58 Years AtThe Time Of Loan Maturity

Loan Amount Minimum Rs. 100,000

Tenure 1 - 7 Yrs

LTV Up To 85% Of On Road Price*

Income NormsGross Salary Of Rs. 1 Lac P.A. For Cat A/B Cars &Rs 2 Lacs P.A. For Cat C/D Cars

Work-Experience Minimum 2 Years Of Total Employment

Telephone

Landline / WLL Phone At Residence. In Case No

Phone At Resident Post-paid Mobile ConnectionWith Resident Address Required.

Foreclosure 4% + Principal Outstanding



83

Processing Fee

Minimum Of Rs 2500 For Cat A Cars, Rs. 3000 ForCat B & C Cars And Rs 3500 For Cat D Cars (PlusUpto 1% Of The Loan Amount At The Discretion Of The Branch Manager)

Eligibility

Calculation

3 Times Of Annual Gross Or 30 Times Of Avg NetSalary Of 3 Months. EMI Must Not Exceed 50% Of Net Salary

Criteria Self-Employed

Age Min 21 Years At Sanction To Maximum 65 Years At TheTime Of Loan Maturity


Tenure 1 - 7 Yrs

LTV Up To 85% Of On Road Price*

Income Norms

Gross Income Of Rs. 60,000 P.A. For Cat A/B Cars &Rs 1 Lac P.A. For Cat C/D Cars (Gross Income : N.PAfter Tax & Depreciation)

Work-Experience Minimum 3 Years In Business

TelephoneLandline / WLL Phone At Residence. In Case No PhoneAt Residence Postpaid Mobile Connection WithResidence Address Required.




84

Processing Fee

Minimum Of Rs 2500 For Cat A Cars, Rs. 3000 For CatB & C Cars And Rs 3500 For Cat D Cars (Plus Upto 1%Of The Loan Amount At The Discretion Of The BranchManager)

Eligibility

Calculation

6 Times Gross Income P.A. (Gross Income = Net Profit+ 50% Of Depreciation For The Last Financial Year.)

Criteria Partnership Firms

AgeMin 21 Years At Sanction To Maximum 58 Years At The

Time Of Loan Maturity For Loan Executing Partner.


Tenure 1 - 7 Year

LTV Up To 85% Of On Road Price

Income Norms

Gross Income Of Rs. 60,000 P.A. For Cat A/B Cars &Rs 1 Lac P.A. For Cat C/D Cars (Gross Income: N.PAfter Tax & Depreciation). Min Turnover Of Rs 4.5Lacs

Work-Experience Minimum 3 Years In Business

Telephone

Landline / WLL Phone At Resident. & Office For Loan

Executing Partner. In Case No Phone At Resident, Post-Paid Mobile Connection With Resident. Address IsRequired




85

Processing Fee

Minimum Of Rs 2500 For Cat A Cars, Rs. 3000 For CatB & C Cars And Rs 3500 For Cat D Cars (Plus Upto 1%Of The Loan Amount At The Discretion Of The BranchManager)

EligibilityCalculation

6 Times Gross Income P.A. (Gross Income = Share InProfit + Salary + Interest On Capital + 50% Of Depreciation For The Last Financial Year) (To TheExtent Of His Share In Partnership)

Criteria Private & Public Ltd. Companies

AgeMin 21 years at sanction to Maximum 65 years at thetime of loan maturity for the loan executingdirector/authorized signatory

Loan amount Minimum Rs. 100,000

Tenure 1 - 5 yrs

LTV Up to 85% of On road price*

Income NormsMin Turnover of Rs. 2 Crore and Minimum Net Profit of Rs 50 Lacs. (No Cash Loss in the last 2 yrs)

Work-experience Minimum 3 years in business

Telephone

Landline / WLL phone at Resident & Office for loanexecuting director/authorized signatory. In case nophone at Resident, post-paid mobile connection withResident Address is required



86

Foreclosure 4% + principal outstanding

Processing Fee

Minimum of Rs 2500 for CAT A cars, Rs. 3000 for Cat B

& C Cars and Rs 3500 for Cat D cars (plus upto 1% of the loan amount at the discretion of the Branch Manager)

Eligibility

calculation6 times Avg. Net Profit of the Last 2 Years

Documents required:

For Salaried:

Proof of IdentityPassport / Voter·s Card / Driving License withPhotograph/ PAN card

Proof of Income

Latest salary slip showing all deductions ANDLatest Form 16 / Income Tax Return (Form 16FYE March should be available June onwards)

Address Proof (of the

residing city)

Ration Card/Latest Electricity Bill/LatestTelephone Bill/Passport/Latest Credit CardBill/ Driving License

Signature VerificationPassport copy/ Driving License withPhotograph/ Banker·s Verification

Additional Document NA

For Self-Employed:

Proof of IdentityPassport / Voter·s Card / Driving License withPhotograph/ PAN card



87

Proof of IncomeLatest Income Tax Return and Computation of income

Address Proof (of the

residing city)

Ration Card/Latest Electricity Bill/LatestTelephone Bill/Passport/Latest Credit CardBill/ Driving License

Signature VerificationPassport copy/ Driving License withPhotograph/ Banker·s Verification

Additional Document Declaration from Proprietor

For Partnership Firms:

Proof of Identity

Copy of Partnership Deed & the followingdocuments required for the loan executing partner:Passport / Voter·s Card / Driving License withPhotograph/ PAN card

Proof of Income

Audited Balance Sheet, Profit & Loss Account forlast 2 years along with the latest 2 Income TaxReturns

Address Proof (of the residing city)

Telephone Bill/Electricity Bill/ Shop &

Establishment Act Certificate/ SSI RegisteredCertificate/ Sales Tax Certificate

SignatureVerification

Banker·s Verification

Additional

DocumentationAuthority letter signed by all partners

For Private & Public Ltd. Companies:



88

Proof of Identity

Copy of Memorandum & Articles of Association &the following documents required for the loanexecuting director/authorized signatory. Passport /Voter·s Card / Driving License with Photograph/

PAN card

Proof of Income Last 2 Years Audited Financials

Address Proof (of

the residing city)

Telephone Bill/Electricity Bill/ Shop &Establishment Act Certificate/SSI RegisteredCertificate/ Sales Tax Certificate/PAN No.

Signature

Verification

Banker·s Verification

Additional

Documentation

List of Directors, Share Holding pattern, Copy of Board Resolution

On Road Price = Ex Showroom rate + Insurance + Road Tax +Registration charges

Interest Rate Grid:

Interest Rate Grid (Direct Branch Source)

Car Category Upto 35 months 36 - 60 months 60 ² 84 months

Cat A 13.00% 12.00% 13.50%

Cat B 13.00% 11.50% 13.50%

Cat C 13.00% 11.50% 13.50%

Cat D 13.00% 11.00% 13.50%



89

Interest Rate Grid (Dealer/DSA sourcing)

Car Category Upto 35 months 36 - 60 months 60 ² 84 months

Cat A 14.50% 13.25% 15.50%

Cat B 14.50% 12.50% 15.50%

Cat C 14.50% 12.00% 15.50%

CAT D 14.50% 11.75% 15.50%

Agricultural Loan:

Financing farmers against pledge of warehouse or cold storage

receipts:

Facility Limit:

Ceiling of Rs. 5.0 lac per farmer

Nature of Facility:

Loan against the pledge of warehouse and/ or cold storage receipts

Eligibility for Farmers:

Original depositors of the receipts.



90

The borrower to undertake that he is a farmer and also to provide a

declaration to the effect that he/she is not defaulter to any Bank/Financial

Institution

Designated Warehouse:

CWC/SWC Warehouses Private warehouses/Cold storages/Godowns with a

minimum storage capacity of 100 MT

Value of Loan:

Value of the loan = Value of commodity minus commodity specific margin

amount

Rate of Interest:

BPLR- 4.75%; at present 15.25 % p.a. payable with the principal repayment.

Margin:

Min 40%.

Tenure of the Loan:

The maximum tenure of each loan shall be 12 months.

Valuation:

The value of the commodity as security shall be the lower of the following:

Value of goods as reflected in the warehouse receipt.



91

Value of the goods based on the average price prevailing in the nearest

mandi on the day previous to the date of disbursement.

Price provided by the Commodity Business Group, Central Office from

time to time for various commodities

Insurance:

The stocks pledged to the Bank should be insured adequately with Bank

clause.

Security Upto Rs. 200,000:

Primary-: Pledge of warehouse receipts duly endorsed in Bank·s favour

Security over Rs. 200,000:

Primary-: Pledge of warehouse receipts duly endorsed in Bank·s favour,

Collateral-: Third party Guarantee

Disbursement:

The individual borrower availing this facility will have to open an account at

the concerned local branch (the account can be opened under ¶SBSPL·

category wherein the average balance requirement is Rs. 1000/-). The

amount will disbursed by crediting the account of the borrower, at the

concerned branch.

Selection of the Warehouse/Cold Storage:

The warehouse/cold storage has to have adequate facilities (like aeration, pest

control, loading and unloading facilities, electricity, security, etc.) to allow

for the storage of the produce with minimum loss in quality and quantity. It is



95

6.

Source of income fromactivities allied to

agriculture/othersource of income

Yes: 3No: 0

Bench marking: (Out of 28):

Score above 18 A1

15-18 A2

10-14 A3

Score below 10 A4

Agricultural Gold Loan ² ¶Power Gold·:

Eligibility:

Any individual who has completed 18 years of age and is involved in

agriculture/allied activities.

In case one spouse is availing of the loan against gold ornaments owned by

the other, the borrowing should be in the joint names.

Gold bullion will not be accepted as security.

Only original owner of the Jewellery.

Jewellery below 20 carat should be avoided.

Limit :

Minimum - Rs.15,000

Maximum - Rs.10,00,000

Loan Amount and Margin:



96

Loan Amount = (Net weight. of ornament in terms of 22 carat) * (Advance

rate)Net weight of ornament in terms of 22 carat = (Net weight of ornaments

* Purity)/ 22

Advance rate at present: Rs.740/- per gram

BH can selectively increase advance rate by Rs.10/ -

Margin Call:

During the tenure of the loan, if the margin of the loan, based on the marketvalue of the gold, falls below 20%, the borrower would be called upon to

deposit the shortfall. If the borrower fails to pay the shortfall within 15 days,

the Bank will have the right to di spose off the gold ornaments.

Security:

Primary - Nil

Collateral - Pledge of gold ornaments

Custody Charges:

If gold value > 5 times loan amount

Rs. 1000 + ST per year

Pricing:

For limit up to Rs. 1.00 Lakh: BPLR-4.25%

For limit above Rs. 1.00 lacs: BPLR-4.75%

Interest application is Annual and to be paid along with principal



97

Penal interest:

2% per year on overdue amount.

Disbursement:

Up to Rs.50,000/- in Cash.

Above Rs.50,000/- by Pay Order.

Documentation:

Following documents should be obtained from borrower. Application form

D.P.Note

D.P.Note delivery cum waiver letter

Letter of Pledge

Proof of agricultural activity (copy of land records, land revenue tax

receipts etc.)

Declaration of ownership of the ornaments pledged

Authorisation from the borrower for disclosure of information

The following document should be obtained from the appraiser

Certificate of valuation

Processing & Appraiser fees:

0.25%+ST subject to maximum of Rs. 500+ST

BH has discretion to waive/ reduce if RoI is increased by 0.30%

No fee up to Rs.25,000/- loan



98

0.25% subject to maximum of Rs.500/-

Insurance:

Gold ornaments pledged to the Bank will be covered under the Master policy

of theft and burglary. Bank·s indemnity policy will be obtained by the Bank

centrally.

Sanctioning Authority:

The sanctioning authority would be the Branch Head in the category of

Manager/AVP/VP. The branches should send the Control Returns on

monthly basis to the Zonal Office for noting and review. The VP (Credit &

Forex) will be the reviewing authority at the Zonal Office.

Repayment:

Repayment period not exceed 18 months. The facility will be renewable at

the request of the borrower after 18 months. The repayment schedule should

be aligned with the crop harvest cycle.

Release of the gold ornaments on repayment by borrower

The branch should release the security only if the full amount of interest,

other charges and principal has been repaid. The borrower should present the

signed receipt issued to him/her by the Bank while taking delivery of the

ornaments. The borrower(s) needs to sign the receipt acknowledging that thegold ornaments have been received by him/her in good order and condition.

The signed receipts should be arranged as per the date of closure of loan

account and shown to the inspecting authority at the time of the inspection.



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Guidelines for the release of the pledged jewellery on liquidation of the loan

on death of the borrower will be issued later in consultation with the Law

Department.

Right of Disposal of Security:

In case of default, Bank has the right to dispose the gold ornaments for

satisfaction of the loan by way of public auction or private treaty and proceed

against the borrower.

Power Gold Plus:

Difference from Power Gold:

Minimum Rs. 2.00 lacs to Rs. 10.00 lacs.

Monthly interest application.

Drawing Power: 80% of value of the ornament.

Field inspection report to confirm the activity is to be undertaken.

Maximum 6 redemptions and pledges can be permitted in a year, Rs.250/-

plus ST will be charged per redemption/pledge.

Custodian charges of Rs.3,000/- plus ST, will be charged per year if the

value of the security is more than 5 times the loan amount.

Pricing:

Direct Agriculture: BPLR²3.75%.

Indirect Agriculture: BPLR-3.25%.

Fee: 0.25% subject to maximum of Rs.1,000/-.

Appraiser Fee: 0.25% subject to maximum Rs.1,000/-.



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Product Features:

CC facility against gold (CCAPG)

Target Group:

For allied agricultural activities like poultry, dairy, fisheries etc- Direct

Agriculture.

Financing agriculture input dealers, Arthias/ Commission agents etc ²

Indirect Agriculture. Crop cultivation should not be financed.

Kisan Power Scheme:

Purpose:

Production Credit i.e. for meeting cost of crop cultivation/allied agricultural

activities.

Investment Loan for meeting any investment need, other than production

expenses, that can improve borrower·s farm productivity i.e. purchase of agricultural equipments, land levelling, land development, vehicles etc.

Consumption Loan for meeting consumption needs

Financing of all allied agricultural activities except the following is eligible

under Kisan Power-No tractor /trailer shall be financed under the Kisan

Power Scheme. Poultry shall not be financed under Kisan Power Scheme

Eligibility:

Any individual who is a major Owner Cultivators Tenant Cultivators and

Share Croppers may be financed selectively. Minimum landholding should be

two acres of cultivable land. Landholding has to be supported by land



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documents like 7/12 extract, Patta, chitta, Adangal (confirming ownership,

crop pattern) etc. Joint holding (single or multiple locations) up to five

persons are permitted.

In case the borrower is more than 60 years of age, a co-borrower is

mandatory. The co-borrower should be a family member / relative of the

Borrower.

Radius of Operation:

Radius of operation restricted to 50 km from the Branch. However, VPAF

may allow financing select cases under the scheme beyond 50 kms and upto 75kms, provided the distance will not come in the way of effective follow up and

recovery.

Nature of Facility:

Term loan ² Consumption Loan and Investment Loan

Cash credit ² Production Credit

Sanctioning authority should ensure that a cash credit facility is extended in all

cases without exception

Amount of Loan:

Overall Limit:

Minimum: Rs. 25001/-

Maximum: Rs. 25,00,000/-

Individual Components:

Facility Min Limit Max Limit

Investment Loan 25001/ 24,74,999/-



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Production Credit* 25,001/ 25,00,000/-

Consumption Loan 50,000/ 5,00,000/- For States of Punjab, Rajasthan &

Haryana and3,00,000/- For all otherstates

*Production Credit is Mandatory

Assessment/Fixation of Limit:

Overall Limit

The overall loan amount/ credit limit will be fixed on the basis of 5 times

annual farm income or 70% of the value of collateral security whichever is less

subject to maximum of Rs. 25,00,000/-

Production Credit

For any Kisan Power account, Production Credit is a must. While calculating

Production Credit Limit, scale of finance should be the basis of assessment,

which is decided every year by District level Technical committee (DLTC).

The Production Credit Limit can be maximum upto 150% of the amount of

Scale of Finance advised by DLTC. Crop insurance premium may be debited

to production credit, but the outstanding should be within limit. In other

words the disbursement needs to be net of crop insurance premium.

Production Credit Limit may be extended for leased land also, subject to the

terms and conditions on security/guarantee etc.

Consumption Loan

The Consumption Loan amount should not be more than 3 times of annual

farm income, and subject to the security criteria, within the upper cap of Rs.

5 lacs/3 lacs as the case may be.



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The assessment of consumption requirement is to be based on the written

declaration of the applicant, and 100% of the declared amount would be

allowed subject to maximum limits specified.

Investment Loan

For purchase of Two/Three/Four Wheelers used for carrying farm goods or

Farm Machinery-:

In such cases, the branches shall ensure that the price of the two/three/four

wheelers or machinery should be equal to or less than the MRP (maximum ex

showroom price, which includes all the state level taxes, but excludes the

registration fee, road tax and insurance) published by the manufacturer. The

actual cost of registration, road tax and insurance can be financed.

In case of vehicles, the Bank·s interest is to be noted in the RC book and the

vehicles are to be insured under a comprehensive insurance policy. Along with

invoice receipt, RC book copy, a photograph of the vehicle and the Borrower

standing nearby is to be obtained and kept on record. This may be obtained

within 45 days of disbursement. Our charge on the vehicle should be

explicitly mentioned on the vehicle.

In respect of development works like deepening/drilling of wells,

construction of pump house/sheds/cattle sheds etc, the estimates made by the

farmers themselves can be accepted, provided the cost does not exceed more

than 20% of the unit cost approved for that activity/purpose in that region by

NABARD.



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Loan from Rs 2,00,001 upto Rs 5,00,000 BPLR 1%

For all other loans -:

Amount Interest Rate

Limit up to Rs. 50,000 BPLR 3.50%

Loan from Rs 50,001 upto Rs 2,00,000 BPLR 3%

Loan from Rs 2,00,001 upto Rs 5,00,000 BPLR 2%

Processing Fee:

Fee @ 0.50% for production credit and 1.00% for Investment Loan and

Consumption Loan. Subject to a minimum of Rs.500/-. Service tax is to be

recovered at the applicable rate.

Sanctioning Authority may at their discretion allow reduction/waiver are free

to recover a higher processing fees on selective basis.

Crop Insurance:

The production credit is to be covered under National Agricultural Insurance

Scheme (NAIS) provided by the Agriculture Insurance Company of India Ltd

(AICIL). Zonal Offices/Advances cells are authorised to waive this

requirement.

Branches to debit actual crop insurance premium from production credit

account (CCAGR). However, no overdrawing should be allowed. It is to be

ensured that the disbursement is made after keeping sufficient balance for

debit of all future insurance premiums.



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Accident Insurance:

All KCC holders shall be covered under Personal Accident Insurance upto

Rs.50, 000/- as per the extant guidelines of Kisan Credit card scheme. This is

done under a master policy with Bajaj Alliance General Insurance Co Ltd by

Central Office and the premium amount of Rs. 15 will be incurred by the

Bank. Also, in case of a claim (due to accidental death, partial disability or

total disability), branches should take up the matter with Bank Assurance Cell

in Retail Banking department at CO for an early claim settlement. The

proceeds of insurance are to be credited to CCAGR account of the borrower.

Insurance of Assets:

All the securities (Building, equipment and Vehicles) created out of the loan

or otherwise are to be insured for full value. Branches may take the help of

our insurance advisers for this purpose.

Disbursement:

Wherever cash disbursement is to be made (in case of Productioncredit/Investment Loan or Consumption Loan), the funds should be credited

to the operative (SB/CC) account of the borrower and should be withdrawn

through cheque leaf.

Investment Loan

Investment loan is to be disbursed in one or more instalments depending upon

the progress of work.

In case of Investment loan for purchase of implements/ equipments/vehicles,

the borrower should be asked to deposit the margin money with the Bank, and

the disbursement is given to the dealer/manufacturer/supplier directly by

DD/ Pay order along with margin.



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In case the implement/ equipment is already purchased by the Borrower,

disbursement is permitted after inspection by the Bank·s official and after

getting the stamped receipt and invoice. These purchases should not be older

than 75 days.

Cash disbursement may be made for purchase of animals, construction of farm

shed etc. and the relative receipt is to be obtained within 45 days of

disbursement. The labour component in Investment loan can be released in

cash after getting written request cum declaration from the Borrower.

Repayment:

Production Credit

Annual review and renewal in every three years. Branches should encourage

Borrowers to bring the sale proceeds of their agricultural produce to their

CCAGR a/c .

Consumption Loan and Investment Loan

All the investment loans (except horticulture projects) and consumption loan

should be repayable within a maximum period of 5 years. Repayment period

up to 7 years is permitted in case of horticultural projects which is inclusive of

moratorium period upto maximum of 3 years. Sanctioning authorities to

ensure that projects having sufficient cash generation in the residual loan

period (I.e. total period minus moratorium period) to ensure repayments only

are considered. A suitable moratorium may be allowed upto maximum of 2

years in case of Investment Loan (except horticulture projects and vehicle

loans). The instalments should be monthly/quarterly/Half yearly/yearly

depending on harvesting of crop and other income sources like dairy, salary,

other employment etc. depending on the income stream the repayment of



108

vehicle loans is to be fixed at monthly/quarterly or half yearly intervals and

the maximum moratorium for vehicle loan is to be restricted to 6 months.

Penal Interest:

2% p.a. on overdue amount.

Documentation:

Borrower:

Demand Promissory Note for Production Credit

Letter of waiver cum DP Note delivery letter for Production Credit

Loan cum hypothecation Document ² ACD 1.

Simple (Registered) Mortgage - ACD 2 / Equitable Mortgage (ACD-4A &

4B).

Duly signed PDCs along with covering letter

Duplicate copy of the sanction letter duly signed by the borrower/s andguarantor/s.

A letter addressed to the Village Revenue Officer advising him to record

the charge of the Bank for the amount of the loan on the land records with

him.

Guarantor:

Deed of Guarantee - ACD 3.

Additional Documentation for Vehicles

Power of Attorney for registering the vehicle in favour of one of the joint

accountholders in case there are more than one borrowers



109

A letter of authority to the Bank for effecting disbursement of the loan

directly to the dealer.

RTO forms no.26, 29,30,34,35

MIS and Monitoring:

Monthly Control Returns to be submitted by the branches/Cluster Heads to

Advances Cell/Zonal Office for reporting advances.

Appraisal and Sanction:

Application for Kisan Power should be obtained from the proposed borrowers

and also the guarantor in the prescribed format. Branches need to offercomments in the proposal on the value of the main security, collateral

security, i.e. value of the land being mortgaged to the bank and the basis of

calculation of limit to the farmer. The agriculture officers/branch staffs

identified to deal with the scheme is to travel to each of the individual centres

to meet the applicants, verify the details and put up the proposal for sanction

to the Branch Head/Cluster Head. The recommending and the sanctioning

authority should sign the proposal.

Pre sanction Visit:

The focus of visit should be on an evaluation of the income stream of the

borrower, and a comprehensive assessment of credit needs taking into account

track record, credibility, capability, as well as technical viability of the existingand proposed activities. Short-term credit needs of the farmer should include

all requirements directly and indirectly related to production, post harvest

and household expenses. Repayment capacity should be assessed on the basis



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Age:Any major individual pursuing dairy farming activity.Eligibility Criteria:

Farmer should have a record of supplying minimum 10 litres of milk per day

on an average for at least one year with the Village Dairy Cooperative Society .

Margin:

15 % of value of cattle to be purchased and/or shed to be constructed.

Rating:

The score sheet for agricultural advances may be used for the purpose. The

farmer with a rating of A1 and A2 may be considered for the loan.

Tenor:

Maximum period of Four Years from the first transaction of disbursement to

borrower with a maximum moratorium period of 3 months before start of

principal repayment.

M&C Commission:

The Dairy will be paid 0.5% of the loan amount as commission for acting as an

M&C agent for the Bank.

Documentation:

Hypothecation cum Term Loan Agreement. Guarantee from Village Dairy

Cooperative Society format is being finalized in consultation with Law

Dept. Personal Guarantee from member of dairy coop society or third

party.



113

Letter addressed by Borrower to Sponsor and Sponsor to Bank.

Letter of comfort/Guarantee from Dairy/Milk Union

M&C Agency agreement between the Dairy and the Bank.

Repayment:

The repayment will be made through escrow mechanism with a maximum

moratorium of 3 months. Thereafter, the loan is to be repaid in maximum 4

years in monthly instalments.

Rate of interest:

Penal interest:

2.00% p.a. on the overdue interest and instalments.

Prepayment Charges:

In case of prepayment of loan within one year from the disbursement: 2% of

the amount prepaid.

The pricing will be irrespective of the rating:Loan Amount Rate

Rs. 30,000-2,00,000 BPLR-3%

Above Rs. 2,00,000 BPLR-3.5%



115

its own appraisal, having right to conduct inspections without any prior

notice. In case the Borrower stops supplying milk to the Union the entire loan

amount shall be repayable in lump sum/ recalled.

Bench marking: (Out of 30)

Score of 26 and above A1

25-21 A2

16-20 A3

<16 A4

Score Sheet for Dairy/Milk Union:

Parameters ScoreScorin

g

Financial Performance of

Dairy/Union

Positive PAT for past 3 years: 5Positive PAT for 2 years out of 3years: 3Negative PAT for for 2 years and

above out of past 3 years: 0

Milk Payment cycle

Less than 7 days: 5More than 7 and Upto 15 days: 3More than 15 days: 0

Extension Services available

through Dairy/ Milk Union:Cattle Feed

Veterinary serviceArtificial Insemination

All three services provided: 5

Two out of three servicesprovided: 3One service provided: 2 Not provided: 0



116

Average capacity utilisation

of Milk Processing Plant

over past 3 years

Above 60%: 5Between 60%-45%: 3Less than 45%: 0

Average daily milk suppliedper farmer member over

current financial year

More than 10 litres: 5Between 5-10 litres: 3Less than 5 litres: 0

Collateral Security available

from Union

Guarantee or cash margin: 5Letter of Comfort: 3

Direct Financing to Farmers under Contract Farming:

Contract farming can be defined as an agreement between farmers and

processing and/or marketing firms for the production and supply of

agricultural products under forward agreements, frequently at predetermined

prices. The arrangement also invariably involves the purchaser in providing a

degree of production support through. The basis of such arrangements is a

commitment on the part of the farmer to provide a specific commodity in

quantities and at quality standards determined by the purchaser and a

commitment on the part of the company to support the farmer·s production

and to purchase the commodity. The intensity of the contractual arrangement

varies according to the depth and complexity of the provisions in each of the

following three areas:

Market provision: The grower and buyer agree to terms and conditions for

the future sale and purchase of a crop or livestock product;



117

Resource provision: In conjunction with the marketing arrangements the

buyer agrees to supply selected inputs, including the inputs required for land

preparation and technical advice;

Management specifications: The grower agrees to follow recommended

production methods, inputs regimes and cultivation and harvesting

specifications.

Parties to the contract farming financing:

Farmer

Bank

Sponsor

Sponsor can act as management and Collection agent to undertake the

following functions:

Identification and screening of borrowers.

Completing application form and other formalities like getting extracts of

land records, no due certificate etc. of the proposed borrowers. Recommending the Bank for loan.

Getting security documents executed by the borrower after sanction from

the Bank and forwarding the same to the Bank.

Paying the amount to the farmer disbursed by the Bank.

Getting stamped receipt from the borrowers in token of having received

the amount of loan and p0ass on to the Bank.

After the supply is over, sending to the Bank the enti re proceeds payable to

the farmer. In case amount payable to farmer by the sponsor is less than



119

Bank. After the satisfaction of our branch personnel about the completion of

documentation formalities, our branch will issue a consolidated cheque

favouring the sponsor·s dedicated current account with our bank.

Sponsor will arrange to provide us the transactions details of the loan

disbursement account on a monthly basis certified by a Charted Accountant.

Amount:

Depending on scale of finance as decided by the DLCC of the lead Bank per

acre of land; or what is mutually agreed upon by the Bank and the sponsor, as

the case may be.

Rate of Interest:

7.00%-12.00% per year. Payable half yearly depending on case to case basis.

Tenor:

Duration of the crop plus two months

Security:

Hypothecation of crop.

Letter of Guarantee / Comfort letter (in absence of the letter of guarantee)from the sponsor

Collateral Security:

Nil

Insurance:

Wherever available the crop should be insured with standard bank clause.

Processing Fees:



120

Nil

Disbursement:

The agriculture extension officers of sponsor will identify the individual

farmers and complete all the documentation formalities as prescribed by the

Bank. Sponsor will forward our branch, the individual applications for the

loan along with the required documents as detailed in the scheme.

After the satisfaction of our branch personnel about the completion of

documentation formalities, our branch will issue a consolidated cheque

favouring the sponsor·s dedicated current account with our bank.

The sponsor will arrange to obtain a stamped receipt from the farmer

borrower in token of having received the amount of loan and pass on to the

Bank. Sponsor will arrange to provide us the transactions details of the loan

disbursement account on a monthly basis certified by a Charted Accountant.

Repayment:

After the supply is over, sponsor shall send to the Bank the entire proceeds

payable to the farmer. The bank will make balance payment to the farmer

after deducting their crop loan dues. In case amount payable to farmer by the

sponsor is less than loan outstanding, sponsor will recover the balance amount

from the farmer and remit to the Bank against the loan out standings.

Our branch would conduct inspection on a half-yearly basis or as decided by

the Bank to verify the crop. Our branch would also verify the books of

accounts of the sponsor at half yearly interval to verify the disbursal of loan as

per the scheme. Also, if required an external auditor would be appointed to

audit the accounts.



121

Other Terms:

Sponsor will sign M & C agency agreement with the Bank.

Education Loan:

Axis Bank's Study Power aims to provide financial support to deserving

students for pursuing higher professional or technical education in India and

abroad. The loan would be provided to students who have obtained admission

to career-oriented courses eg, medicine, engineering, management etc.,

either at the graduate or post-graduate level.

Quantum of loan:

The quantum of finance under the scheme is capped at Rs.10 lacs for studies in

India and RS 20 Lacs for studies abroad, which cover tuition fees, hostel

charges (if any), cost of books, etc. The minimum amount of loan would be

RS 50000.

Margin:

No margin for loans upto Rs 4 lacs. For loans above Rs 4 lacs, 5% margin for

studies within India and 15% for higher studies overseas.

Rate of interest:

Interest rates linked to PLR.

Role of the Guardian:



122

The parent(s) or guardian of the student would be treated as a co -applicant of

the loan. His or her role would be, necessarily, like the primary debtor.

Security:

Third party guarantee and/or collateral security may be asked for in

appropriate cases.

Additional Security:

Assignment of LIC Policy in favour of the Bank for the sum assured being at

least 100% of the loan amount. The policy is kept alive during the currency of

the loan. To ensure this, the annual premium may be include in the

computation of the loan requirement, along with the tuition fees and other

recurring charges. Further, the future income of the student needs to be

assigned in favour of the Bank for meeting the instalment obligations.

Disbursement:

The loan will be disbursed in full or in suitable instalments taking into account

the requirement of funds and/or fee schedule as assessed by the Bank directly

to the educational institution or vendor of books or equipment or

instruments.

Penalty for early closure:

Nil

**********************



123

CHAPTER 7

FINDINGS



125

owing to the efficacy of its business model which aspires to be

customer-centric.

Information technology is continuously leveraged in providing value

added products and services as well as multiple-delivery channels to

customers in a manner that is cost-effective and which offers the

Bank¶s customers easy, real-time and on-line access for all types of

transactions.

The strong performance, despite a tightening of overall liquidity

leading to a hardening of interest rates in the closing stages of the

fourth quarter, reflected the fact that the primary

Goals of the Bank of increasing its market share in various businesses

and improving its quality of earnings by enhancing its core income

streams, is solidly anchored in the strategy adopted by it.

The sizeable network of branches, extension counters and ATMs has

equipped the Bank with an impressive reach across the country and is

supported by channels such as the Internet and mobile phone banking.

The steady widening of this reach to smaller cities and towns,

including in district headquarters, is expected to sustain the

momentum of growth of low cost deposits, as the Bank enjoys a first-

mover advantage vis-à-vis other private sector banks in many of these

centers.

The key factors which contributed to the healthy performance of the

Bank during the year were the



126

Continued thrust on improvement in the quality of earnings

through an emphasis on core income streams such as net interest

income and fee based income;

The availment of opportunities emanating from the upswing in

the corporate credit cycle;

A focus on improvement in asset quality through rigorous credit

and risk appraisal, sound treasury management, product

diversification and internal control;

Enhanced cost efficiency by leveraging on technology that is

continuously upgraded;

Maintenance of high standards of customer service.

SERVICES ADDED TO GAIN COMPETETIVE ADVANTAGE:

BUSINESS CONTINUITY CENTRE:

UTI Bank was the first bank in the country to set up a Business

Continuity Centre (BCC)

In Bangalore which replicates the entire centralized database with a

view to enable the Bank to run smoothly in case of any eventuality

affecting the Bank¶s Data Centre in Mumbai.

Each transaction that gets recorded at the Data Centre gets reflected

almost instantaneously

through WAN on the back-up database at the BCC.

CENTRALISED PHONE BANKING CENTRE



127

The Bank¶s Centralized Phone Banking Centre provides customers

across the country

Access to the Bank over the phone, handling multiple queries in about

7000 calls per day.

CENTRALISED COLLECTION AND PAYMENT HUB

The Bank¶s Centralized Collection and Payment Hub (CCPH)

manages the entire collection and

Payment activity under the Bank¶s Cash Management Services (CMS)

across the country, handling on an average about Rs.5000 crores per

month on the collection front and about Rs.1500 crores per month on

the payment front.

RETAIL ASSETS MANAGEMENT GROUP

The Bank¶s Retail Assets Management Group (RAMG) is the

operations hub of the entire

Retail asset distribution structure. In addition to opening and

disbursing more than 3000

Schematic loans every month, it is responsible for the maintenance of

more than 100,000

Such loan accounts, and handles the entire post ± dated cheque

presentation and several

inds of repayments for all these accounts.

ATM BACKEND CEL



128

The ATM Backend Cell handles the entire cash management and

reconciliation of balances pertaining to ATMs across the country and

ends up tallying over four lakh

Transactions by the end of the day.

SERVICE BRANCHES

The Bank¶s Service Branches in the 8 major metros take care of

centralized clearing activity,

Handling more than one lakh cheques every day for outward and

inward clearing.

DATA CENTRE

The Bank¶s Data Centre in Mumbai, the centralized IT powerhouse is

like the central nervous system of the Bank . It is a real time 24x7

setup which manages 270 products and services of the Bank with a

database size of 1850 GB supporting on an average 42 lakh

transactions per day

to service over 42 lakh customer accounts and adding new customers

@ 8000 per day.

CENTRALISED PROCESSING UNIT

The Bank¶s Centralised Processing Unit (CPU) is the backbone of the

Bank, managing production and delivery of the entire range of

deliverables to customers across the country within 24 ± 72 hours

from the time the customer opens the account. The CPU currently

handles about 8500 new accounts every day.



129

CHAPTER 8

SUGGESTIONS/

RECOMMENDATIONS



130

SUGGESTIONS/RECOMMENDATIONS

A healthy banking system is essential for any economy striving to

achieve good growth and yet remain stable in an increasingly global

business environment. The Indian banking system, with one of the

largest banking networks in the world, has witnessed a series of

reforms over the past few years like the deregulation of interest rates,

dilution of the government stake in public sector banks (PSBs), and

the increased participation of private sector banks.

The growth of the retail financial services sector has been a key

development on the market front. Indian banks (both public and

private) have not only been keen to tap the domestic market but also

to compete in the global market place. New foreign banks have been

equally keen to gain a foothold in the Indian market.

Key banking reforms needed:

Encourage voluntary consolidation among banks

Allow public sector banks to fix salary levels proportionate to

performance

Permit banks to issue preference shares to raise capital.

More autonomy to fix salary levels proportionate to

performance.

Offer Competitive compensation packages at all levels to

improve employee productivity.



131

Strengths of the banking industry

Regulatory systems,

Economic growth,

Technological advancement,

Risk assessment systems

Credit quality.

Scope of improvement includes:

Diversification of markets beyond big cities,

Human resources systems, size of banks,

High transaction costs, infrastructure and labor inflexibilities

RECOMMENDATIONS TO THE COMPANY TO GAIN

UPPER MARKET SHARE:

UTI Bank was one of the first private banks to launch operations in

the country in 1994, after the Government of India passed a resolution

in favor of privatization. An IT savvy bank, UTI Bank is a pioneer in

adopting new technologies in the banking sector . UTI has a very large

network of branch offices and extension counters across the country.

With over 1700 ATMs, UTI Bank has the largest ATM network of its

kind in India.

CRM:

Privatization opened up the Indian banking sector, allowing a large

number of players to offer retail banking services in the country.

Using the latest technologies, UTI Bank introduced quality services to



132

enhance the banking experience of its customers. As the services stack

expanded, supporting customers became a challenging task . Efficient

service and timely support were the deciding factors for customers to

remain loyal to any particular bank, which brought Customer

Relationship Management (CRM) into sharp focus.

BPO:

UTI Bank wanted to establish itself as a customer focused bank and

carve a niche for itself amidst the widespread competition. Setting up

a state of the art call center facility that could provide quality support

to customers across the country became vital to further this goal. The

call center was expected to eliminate the load of routine queries that

branch operators had to handle. A dedicated response center would

allow branch operators to divert all customers¶ queries to the helpdesk

number and focus on their core responsibilities instead. Also, a single

window service with a populated knowledgebase would introduce a

high degree of standardization in the replies given to customer

queries. The bank was also looking to avoid a situation where

customers would be put on hold for long periods of time. A failover

and redundancy solution was required to guarantee high availability of

services and ensure uninterrupted call traffic. For handling large call

volumes, the application infrastructure was also required to beperfectly scalable. The bank wanted a solution that could

accommodate growth over a long period of time.



133

CHAPTER 9

CONCLUSION



134

CONCLUSION

My experience with A xis Bank Ltd. is outstanding. Whileworking in A xis Bank I found that this bank has developedmanifold in short period of time due to facilities and servicesprovided to their customer and this growth rate can be keep it upif they start to go in semi-urban areas. In last couple of years they have opened new many branches and they should open many more. The working staff is very co-operative in nature and due tothat the bank will also get good benefit. A xis Bank has provided

theircu

stomer Net-banking fac

ilities and du

e to thattransactions are done fast. Charges at A xis Bank are on lowerside when we compare it with other Banks.

It was a great opportunity to gain an insight about various activities that

takes place in the bank.

I came to know what banking is all about.

About AXIS Bank.

The kind of products and services are provided by AXIS Bank.

This training increased my confidence level and it was a great opportunity

to learn about corporate culture and etiquettes.

It was a great opportunity to develop persuasion skills and communication

skills.



135

Abbreviations and Acronyms

(Glossary)



136

Bank:

RBI : Reserve Bank of India

BIS : Bank of International Settlement

BCBS : Basel committee on Banking Supervisory PracticesNABARD : National Bank of Agriculture and Rural Development

DICGC : Deposit Insurance and Credit Guarantee Corporation

ECGC : Export Credit Guarantee Corporation

Delivery Channels:

SOL : Service Out-letATM : Automatic Teller Machine

PIN : Personal Identification Number

POS : Point of Sale

VbV : Verified by Visa (Secured Internet Payment System)

WWW : World Wide Web

SMS : Short Messaging Service

Overseas Investor:

FII : Foreign Institutional Investor

NRI : Non Resident Indians



138

SWIFT : Society for World Wide Inter Bank Financial

Telecommunication (Network)

MICR : Magnetic Ink Character Recognition

Regulators:

AMFI : The Association of Mutual Funds in India

IRDA : Insurance Regulatory and Development Authority

SEBI : Security and Exchange Board of India

CBIL : Credit Information bureau (India) Ltd.

Investment:

CRR : Cash Reserve Ratio

SLR : Statutory Liquidity Ratio

ALM : Assets liability Management

ALCO : Assets Liability CommitteeREPO : Reverse Purchase Order

GDR : Global Depository Receipt

ADR : American Depository Receipt

General:

BPLR : Benchmark Prime landing Rate

FCNR : Foreign Currency Non Resident

NRE : Non Resident External

NRO : Non Resident Ordinary

FEMA : Foreign Exchange Management Act, 1999



139

FERA : Foreign Exchange Regulation Act, 1973

FEDAI : Foreign Exchange Dealers Association of India

HUF : Hindu Undivided Family

COPRA : Consumer Protection Act.

Ombudsman : To Take Public Complaints against the Public

Authorities

TDS : Tax Deductible at Source

KYC : Know Your Costumer

FATE : Financial Action Task Force

FIU-IND : Financial Intelligence Unit India

CAR : Capital Adequacy Ratio

CRAR : Capital to Risk-Weighted Assets Ratio

GAAP : Generally Accepted Accounting Principles

NPA : Non Performing Assets

SARFAESI : Securitisation and Reconstruction of Financial Assets and

enforcement of Securities Interest (Act)

GRACE : Ground Rules and Codes of Ethics



140

A ENDIX/ANNEXTU ES



141

Questionnaire On Credit CardRimple bamba

H.no 36-b,modal town,

Rani ka bagh,ASR

9888210520

[email protected]

Name: __________________________________

Todays date _________________

Address:________________________________________________________

____

City, state, _______________________________

Zip code ____________________

Phone no._______________________________

Mob.No.____________________

1.Gender of Credit card user.

o Male

o Female

2. Age group of credit card users.

15 to 35

35 to 50

50 to 60 Above 60

3. Your annual Income?

1,00,000 1,00,000 to 2,00,000

2,00,000 to 3,00,000



142

< 3,00,000

4. Which area they belong?

Rural

Urban

5. Occupation of credit card user?

Lawyer Doctor Engineer

Architect Builder Consultant

Exporter Importer Student

Others, Please specify______________________________________

6. Which Bank Credit card you use?

AXIS Bank

SBI Bank

ICICI Bank

HDFC Bank

7. How long have been you using the Credit card?

Less than 6 months 1to 2 years

2 to 4 years

More than 4 years

8. How of ten do you use Credit card services in a day?

............... Times

9. In which bank you are operating your savings account?

_______________________________________________

10. In which bank you are operating your current account?

________________________________________________________

__



143

11. How much minimum balance or average quarterly balance you

have to maintain in

your account?

Savings Account _________________Current Account _________________

12. Why has you chosen this bank?

Past Relationship

Brand name

Near to home/office

Others, Please specify_______

13. Are you satisfied with the services providing by your bank?

Satisfied

V.Satisfied

Indiff erent

Dissatisfied

V. Dissatisfied

14. What are the services provide by your bank?

Home Banking (Free/ charged)

Net Banking (Free/ charged)

Phone Banking (Free/ charged)

At-par cheque Book (Free/ charged)

Global Debit Card (Free/ charged)

Demand Draf t (Free/ charged)

Auto Sweep FD (Free/ charged)24 hrs ATM (Free/ charged)

Investment a/c (Free/ charged)

Additional savings a/c (Free/ charged)

Others, please specify ________________________________



144

15. Are you Satisfied with Bank¶s Services?

Yes

No

Fully Partially

16. How would you rate the services of Bank?

1. Good 2. Fair

3. Poor 4. Very poor

17. Are you satisfied with the relationship maintained by the bank?

________________________________________________________

_______

18. What kind of quality of the relationship do you like to in your

bank?

________________________________________________________

_______

19. Do you think that your bank is providing a Quality customer care

services?

________________________________________________________

_______

20. What exactly you are looking for in your bank? Please write

your expectations.

________________________________________________________

____

_________________________

SIGNATURE

DATE

PLACE



3 Banking A nd Finance

4 Banking Developments in India

5 Basics of Banking

6 Bank leaflet and Boucher

7 Internet www.Axisbank.com

www.google.co.in

www.finance.india.mart.com

www.banknetindia.com

www.rbi.org

www.moneycontrol.com