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ALLAHABAD BANK
SUMMER TRAINING PROJECT
Retail Banking in India
Undertaken at
HDFC BANK
Submitted in the partial fulfillment for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Under the Supervision Submittedby
and Guidance of MBA 3RD Semester
Mr. Chandan parsad SARGUN KAUR
Enroll no. 08217003911
SESSION: 2012 2013
TECNIA INSTITUTE OF ADVANCED STUDIESApproved by AICTE, Ministry of HRD, Govt. of India Affiliated To Guru Gobind Singh Indraprastha University,
DelhiINSTITUTIONAL AREA, MADHUBAN CHOWK, ROHINI, DELHI- 110085
E-Mail: director.tecniaindia@ gmail.com, Website: www.tecnia.in
Fax No: 27555120, Tel: 27555121-24
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ALLAHABAD BANK
TECNIA INSTITUTE OF ADVANCED STUDIESApproved by AICTE, Ministry of HRD, Govt. of India Affiliated To Guru Gobind Singh Indraprastha University,
DelhiINSTITUTIONAL AREA, MADHUBAN CHOWK, ROHINI, DELHI- 110085
E-Mail: director.tecniaindia@ gmail.com, Website: www.tecnia.in
Fax No: 27555120, Tel: 27555121-24
Declaration
I, Sargun kaur (08217003911), MBA 3rd Semester of the Tecnia Institute of Advanced
Studies, Delhi hereby declare that the Summer Training Report entitled Retail
Banking in India with special reference to HDFC bank is an original work and the
same has not been submitted to any other Institute for the award of any other degree. A
presentation of the Summer Training Report was made on _______________________
and the suggestions as approved by the faculty were duly incorporated.
Date: Signature of the Student
Certified that the Summer Training Report submitted in partial fulfillment of Master of
Business Administration (MBA) to be awarded by G.G.S.I.P. University, Delhi by
Sargun kaur Enrolment No. 08217003911 has been completed under my guidance and
is Satisfactory.
Date: Signature of the Guide
Name of the Guide:
Designation:
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Acknowledgement
It gives me immense pleasure and sense of achievement in preparing and presenting this
project report as per the requirements for the completion of Summer Internship project.
Apart from the efforts taken by me, the success of this project depends largely on the
encouragement and guidelines of many others. I take this opportunity to express my
gratitude to the people who have been instrumental in the successful completion of this
project. I would like to express my sincere gratitude towards ALLAHABAD BANKfor
providing me the opportunity to be a part of the organization and offering me a
challenging project as a part of my summer training.
I am deeply indebted to my faculty guide Prof.M.N.JHA from Tecnia Institute of
Advanced Studies(GGSIPU), whose help, stimulating suggestions and encouragement
helped me in all the time of research and for competing this project
I extremely extend my heartiest gratitude to Mr.P.K.ARORA, CHIEF MANAGER
(RETAIL BANKING) ALLAHABAD BANK as without his guidance it would not
have been possible to undertake this project. I hope I can build up this experience and
knowledge that I have gained here and will be able to make a valuable contribution
towards the organization in coming future.
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Contents
S. No Topic Page No.
1 Declaration 2
2 Acknowledgement 3
3 Executive Summary 4
4 List of Tables 6
5 Chapter-1: Introduction 8-20
6 Chapter-2: Research Methodology
21-30
7 Chapter-3: Theoretical Background 31-44
8 Chapter-4: Data Processing and Analysis 45-50
9 Chapter-5: Management Lessons 51-56
10 Chapter-6: Findings 57-58
11 Chapter-7: Recommendations 59-60
12 Chapter-8: Conclusion 61-62
13 References/Bibliography 63
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14 Annexure (Questionnaire) 64-66
List of Tables
Table
No.
Title Pg. no.
1. Consumer responses towards retail banking awareness
46
2. Percentages of people who has ever availed any kind of loan
47
3. Types of loan
48
4. Kind of Banks
48
5. Credit / Debit Cards users
49
6.
7.
8.
9.
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List Of Charts
S.No. Title Pg. no.
1. Types of Research
23
2. Types of Sampling
29
3. Consumer Awareness
46
4. Population availed Loan
47
5. Market share of kinds of loans as per survey
47
6. Market share of public sector banks as per survey
48
7. Share of debit / credit cards
48
8.
9.
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CHAPTER - 1
INTRODUCTION
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INTRODUCTION
Retail banking is banking in whichbanking institutions execute transactions directly
with consumers, rather than corporations or other banks. Services offered
include savingsand transactional accounts, mortgages,personal loans, debit cards,
andcredit cards.
Commercial bankhas two meanings:
Commercial bank is the term used for a normal bank to distinguish it from
an investment bank. (After the great depression, the U.S. Congress required
that banks only engage in banking activities, whereas investment banks were
limited to capital markets activities. This separation is no longer mandatory.)
Commercial bank can also refer to a bank or a division of a bank that mostly
deals with deposits and loans from corporations or large businesses, as
opposed to normal individual members of the public (retail banking). It is
the most successful department of banking.
Community development bankare regulated banks that provide financial services and
credit to underserved markets or populations.
Private Banksmanage the assets of high net worth individuals.
Offshore banks are banks located in jurisdictions with low taxation and regulation.
Many offshore banks are essentially private banks.
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http://en.wikipedia.org/wiki/Banking_institutionhttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Transactional_accounthttp://en.wikipedia.org/wiki/Mortgage_loanhttp://en.wikipedia.org/wiki/Personal_loanhttp://en.wikipedia.org/wiki/Debit_cardhttp://en.wikipedia.org/wiki/Debit_cardhttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Commercial_bankhttp://en.wikipedia.org/wiki/Community_development_bankhttp://en.wikipedia.org/wiki/Private_bankinghttp://en.wikipedia.org/wiki/Private_bankinghttp://en.wikipedia.org/wiki/Offshore_bankhttp://en.wikipedia.org/wiki/Banking_institutionhttp://en.wikipedia.org/wiki/Savings_accounthttp://en.wikipedia.org/wiki/Transactional_accounthttp://en.wikipedia.org/wiki/Mortgage_loanhttp://en.wikipedia.org/wiki/Personal_loanhttp://en.wikipedia.org/wiki/Debit_cardhttp://en.wikipedia.org/wiki/Credit_cardhttp://en.wikipedia.org/wiki/Commercial_bankhttp://en.wikipedia.org/wiki/Community_development_bankhttp://en.wikipedia.org/wiki/Private_bankinghttp://en.wikipedia.org/wiki/Offshore_bank -
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Savings banksaccept savings deposits.
Postal savings banksare savings banks associated with national postal systems.
Retail Banking services are also termed as Personal Banking services
.
1.1 COMPANY PROFILE
Allahabad Bank which began operations in 1865, has its head-quarters in Kolkata is
the oldest joint stock bank in India. The bank was founded in the historical city
Allahabad in 1865 and now the bank has crossed 2500 branches on 31st march 2012.
[1]The Chairman and Managing Director of the bank is Shri J. P. Dua. The bank has a
branch in Hong Kongand a representative office inShenzen.
The oldest Joint Stock Bank of the Country, Allahabad Bank was founded on
April24,1865 by a group of Europeans at Allahabad. At that juncture Organized
Industry, Trade and Banking started taking shape in India. Thus, the history of the Bank
spread over three Centuries- Nineteenth, Twentieth and Twenty-First.
Centralized Retail Banking Boutique Branches in 27 cities all over the country, and it
has branches which are widespread to 75 cities of the country.
The Bank opened its first overseas branch at Hong Kong. In March 2007, Banks
business crossed Rs.100000 crores mark.
Allahabad Bank is the oldest nationalized Bank with rich experience in extending
various banking solutions to its valued clients since 1865. Their consistent track record
of growth with profit providing.
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http://en.wikipedia.org/wiki/Savings_bankhttp://en.wikipedia.org/wiki/Savings_bankhttp://en.wikipedia.org/wiki/Savingshttp://en.wikipedia.org/wiki/Postal_savings_systemhttp://en.wikipedia.org/wiki/Postal_savings_systemhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Allahabad_Bank#cite_note-0http://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Shenzenhttp://en.wikipedia.org/wiki/Shenzenhttp://en.wikipedia.org/wiki/Shenzenhttp://en.wikipedia.org/wiki/Savings_bankhttp://en.wikipedia.org/wiki/Savingshttp://en.wikipedia.org/wiki/Postal_savings_systemhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Allahabad_Bank#cite_note-0http://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Shenzen -
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Allahabad Bank is one of the premier nationalized banks in India. It is also the oldest
joint stock bank oof India. It was incorporated by a group of Europeans at Allahabad on
April 24, 1865. It was the time Indian Economy had started shifting towards organized
trade and business affairs. After some years in 1920, the P & O bank brought Allahabad
Bank and its headquarters at Kolkata. Allahabad Bank got an entirely new identity when
it was nationalized in 1969 along with 13 other banks in India. Since then the Allahabad
Bank had a smooth journey towards progress. Today it is one of the leading bank in
India with a whooping business of over 100000 crores.
BRANCHES AND BUSINESS
Allahabad has adopted CBS (Core Banking Service) since 2006 and has developed 24
hours connectivity with its 2165 branches across the length and breadth of the country.
In 143 years of its existence the bank has come a long way by developing a wide grip
over all the corners of India. At present the Allahabad Bank has 44 zonal offices, 6 staff
training colleges and 3 staff training centres for imparting training centers in India.
Apart from general branches the bank has also come up with specialized branches like
Industrial Finance Branches, International Branches, Finance Branches, Recovery
Branches, NRI Branches Specialized Personal Banking Branches, Specialized Saving
Bank Branches, Quick Collection Service Branches, Trading Finance Branches and
Service Branches in many major cities of India.
The business of the bank are thriving successfully. In the end of March 2007, the
Allahabad Bank crosses a landmark of Rs.100000 crores. The banks business also
registered a 6.90% growth during Apr-Sept 2007, when its business increased upto
Rs.1,08,458 crores from 1,01,458 crores in merely 5 months. On year-on-year basis, the
business of the bank has grown at a rate of 19.87%. the bank also registered an immense
growth in total deposit record when its business went upto Rs.65896 crores at end of
September 2007 from Rs.54006 crores in September 2006.
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THE BANK POLICIES
To provide professional, efficient, courteous, diligent and speedy services in the matter
of retail lending.
a. Not to discriminate on the basis of religion, caste, sex, descent or any of them.
b. To be fair and honest in advertising and marketing of Loan Products.c. To provide customers with accurate and timely disclosure of terms , costs, rights
and liabilities as regards loan transactions.
d. If sought, to provide such assistance or advise to customers applying for loans.
e. To attempt in good faith to resolve any disputes or differences with customers
through complaint redressal cells within the organization.
f. To comply with all the regulatory requirements in good faith.
g. To spread general awareness about potential risks in contracting loans and
encourage customers to take independent financial advice and not to act only on
representation from banks.
PRODUCTS INFORMATION
1. A prospective customer would be given all the necessary information adequately
explaining the range of loan products available with our bank to suit his needs.
2. On exercise of choice, the customer would be given the relevant information
about the loan product of his choice.
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3. The customer would be explained the processes involved till sanction and
disbursement of loan and would be notified of timeframe within which all the
processes will be completed ordinarily at our bank.
4. The customer would be informed of the names and phone numbers of branches
and the persons whom he can contact for the purposes of loan to suit his needs.
5. The customer will be informed the procedure for servicing & closure of the loan
A/C.
INTEREST & OTHER CHARGES
Interest rate for different loan products and the subsequent revisions would be made
available through any one or all of the media, namely- Banks Web Site, over telephone
where tele-banking facility is available, other media.
Interest rate revisions to the existing customers would be notified within 3 working days
from the date of change through the media listed in point no 6.
The bank would notify clearly about the default interest /penal interest rates to the
prospective customers.
Customers would be entitled to receive on demand periodic updates on the interest rates
applicable to their accounts. On demand, customers can have full details of method of
application of interest.
The bank would notify details of all charges payable by the customers in relation to their
loan account.
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The Bank would make available for the benefit of prospective customers all the details
relating to charges and also subsequent revisions (generally in respect of retail products)
In the media as specified in point no 6.
The bank would clearly specify to charge account for interest and charges, wherever
necessary and obtain a mandate from them at the time of documentation for debiting the
said account.
PROCESSING OF LOAN APPLICATION
The Bank would ordinarily give an acknowledgement of receipt of loan request and if
demanded by the customer, a copy of the application form duly acknowledged would
also be given, as soon as the customer chooses to buy a product or service of his choice.
Immediately after the decision to sanction the loan, the Bank would show draft of the
documents that the customer is required to execute and would explain, if demanded by
the customer, the relevant terms and conditions for sanction and disbursement of loan.
Loan application form, Draft documents or such others papers to be signed by a
customer will comprehensively contain all the terms and conditions relating to the
product or service of his choice.
Wherever possible, reasons for rejection of loan would be conveyed to the customers.
Before disbursement of loan and on immediate execution of the loan documents, the
bank would deliver a copy of the duly executed documents to the customers.
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ACCOUNTING PRACTICES
The bank would provide regular statement of accounts, unless not found necessary by
the customers.
The bank would notify due dates for application of agreed interest, penal interest,
default interest and charges if they are not mentioned in the loan applications,
documents or correspondence.
The bank would notify in advance any change in accounting practices that would affect
the customer, before implementation.
INFORMATION SECRECY
All personal information of the customer would be confidential and would not be
disclosed to any third party unless agreed to by the customer. The term Third party
excludes all law enforcement agencies, Credit Information Bureau, Reserve Bank of
India, other banks and financial institutions.
Subject to above Para, customer information would be revealed only under the
following circumstances, namely;
a. If the bank is compelled by law.
b. If it is in the public interest to reveal the information.
c. If the interest of the bank require disclosure.
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FINANCIAL DISTRESS & REDRESSAL OF GRIEVANCES
The bank would encourage the customer to inform about their financial distress toreckon such cases brought in banks notice and consider them sympathetically.
The bank would make available all the details on Grievance Redressal, namely;
a. Where a complaint can be made
b. How a complaint should be made
c. When to expect reply
d. Whom to approach for redressal of grievance etc.
Response to a complaint whether positive or negative or requiring more time for
redressal would be given within a maximum period of four weeks unless the nature of
complaint is such that it requires verification of voluminous facts and figure
PRODUCT AND SERVICES
DEPOSIT PRODUCTS
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Diamond Jubilee Deposit Scheme
Rs.5 Banking
Gold Deposit
Flexi-fix deposit
RETAIL CREDIT PRODUCTS
All Bank Housing Finance Scheme
Personal Loan Scheme for Pensioners
All Bank Property Loan
All Bank Saral Loan Scheme
All Bank Educational Loan Scheme
Overdraft Facility in Savings Bank Account
Personal Loan Scheme for Doctors/ Medical Practitioners
Loan against NSC/ KVP
All Bank Mobile Scheme
All Bank Rent Loan
All Bank Gyan Dipika Scheme
All Bank Car Finance Scheme
All Bank Pilot Training Loan Scheme
All Bank Furnishing Loan
All Bank Gold Loan Scheme
All Bank Reverse Mortgage Scheme
All Bank Abhusan Scheme
All Bank Trade Scheme
OTHER CREDIT PRODUCTS
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Kisan Credit Card
Kisan Shakti Yojana
All Bank-Expo
SERVICES
All Ayushman Bima Yojana
Cash Management Services
Depository Services
Visa Cum Debit Card Services
Real Time Gross Settlement
National Electronic Funds Transfer
Gold Card Scheme for Exporters
Charter for MSMEs
Government Business
The bank particularlyfocuses on the retail bankingwhile serving all
sectors of the Indian economy. Banks operations for corporate and
commercial customers cater to large corporate customers as well as to
small and middle market businesses and government entities. Corporate
and commercial products include Term Loans, Bill Discounting, Export
Credit and other business credit and financing products. Also the bank
offers a wide range of retail products including Home Loans, Personal
Loans and Automobile Loans as well as Debit Cards. In addition,
specialized products and services to the agricultural sector also is one of
the entities of the bank. All the above products or services of the bank
offered through extensive branch network, extension counters, ATMs,
phone banking and the internet. In Twentieth Century, the bank became a
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part of P&O Banking Corporations group with a bid price of Rs.436 per
share in 1920. The Head Office of the bank was shifted o Calcutta on
business considerations during the year 1923. The bank crossed its
century year in 1965. In July 19th of the year 1969, Allahabad Bank was
nationalized (with 151 branches-Rs.119 crores of deposits and Rs.82
crores of Advances) along with 13 other banks. United Industrial Bank
Ltd. was merged with the bank in October of the year 1989. The bank
made a foray into merchant banking activity in 1984 and subsequently
instituted All Bank Finance Ltd.as a wholly owned subsidiary for
Merchant Banking in the year of 1991. The Official Language
Implementation Committee of Calcutta awarded the Rajbhasha Shield to
the Bank as Second Prize for its best performance for the year 1991.
During the year 1995,the bank had entered into an MOU with the Small
Industries Development Bank of India (SIDBI) for financing small-scale
industrial units. In 1996, the bank had set up Information Technology
Centre to provide in-depth computer training to officers at Calcutta and
Lucknow. Consequent to the SEBI Rules and Regulations, the company
surrendered its merchant banking registration in 1998 and got it
registered as a Non Banking Financial Company (NBFC) with ReserveBank of India (RBI). In the same year of 1998, the bank had received
permission from the RBI for gold trading. Allahabad Bank had entered
into an arrangement, informally though, with IDBI and ICICI in regard to
funding of infrastructure projects. During the year 1999, Allahabad Bank
had launched two new schemes to increase the pace of Credit off take
and in the same period TATA CONSULTANCY SERVICES (TCS) has
entered into a contract with the bank for implementing the Integrated
Standard Banking System (ISBS), a branch mechanization package at 60
branches. The bank bagged 3 major core sector clients, namely, National
Thermal Power Corporation (NTPC), Power Grid Corporation and Indian
Railway Finance Corporation Limited (IRFC). In 21st century, Allahabad
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Bank had launched its new Personal Loan Scheme for pensioners in the
year of 2001.
The bank has improved its performance and established its visibility and
strong presence in the market. The bank steadily moving at a faster pace
to consolidate its position in the coming days introducing extensive
computerization to ensure the state-of-the-art service comfort for its
customers. The Bank has already in hand 116 authorizations for opening
of new branches. The Banks plan is to expand in area where the banks
presence is not very much visible now and where business potential is
good.
1.2 OBJECTIVE OF THE STUDY
To understand what is retail banking which includes a major study on retail
lending by Allahabad Bank and also with the help of market survey studying
which type of loan has the largest market share.
Which kind of banks is mostly preferred by people i.e. a distinction between
nationalized and private banks.
Studying about different retail lending products of the bank, what is the
procedure which is followed by bank in retail lending. The study is done by conducting a survey on 100 salaried people may or may
not be the Allahabad Bank customer.
Thus, an analysis is done on the present retail banking scenario of India
focusing mainly on Allahabad bank retail lending.
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CHAPTER - 2
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RESEARCH
METHODOLOGY
OVERVIEW
This chapter highlights what are the types of research used, sources of data and its
collection procedure, sample size and the location from where the data is collected. This
chapter provides a theoretical framework of the survey, interpretation and it supports to
do the analysis.
SOURCES OF DATA
For the purpose of the study, the data required is obtained from two types of sources
namely
Primary Sources
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Secondary Sources
TYPES OF RESEARCH
The different types of research are shown below, out of which one or two will be
utilized for research work.
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Research Design
ConclusiveResearchDesign
ExploratoryResearchDesign
Descriptive Causal
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Chart 2.1 TYPES OF RESEARCH
2.1 PRIMARY DATA
Primary data is important for all areas of research because it is unvarnished information
about the results of an experiment or observation. It is like the eyewitness testimony at a
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Single Cross-SectionalDesign
Multiple Cross-SectionalDesign
Research Design
ConclusiveResearchDesign
ExploratoryResearchDesign
DescriptiveResearch
CausalResearch
Cross-SectionalDesign
LongitudinalDesign
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trial. No one has tarnished it or spun it by adding their own opinion or bias so it can
form the basis of objective conclusions.
Primary data is the specific information collected by the person who is doing the
research. It can be obtained through clinical trials, case studies, true experiments and
randomized controlled studies. This information can be analyzed by other experts who
may decide to test the validity of the data by repeating the same experiments.
Its advantage is that you can find data needed to suit your purpose. Disadvantage
being usually more costly and time consuming than secondary data.
Primary data can be gathered by:
Communication methods
Interacting with respondents.
Asking for their opinions, attitudes, motivations, and characteristics.
Observation Methods
No interaction with respondents.
Letting them behave naturally and drawing conclusions from their behavior.
In this study, I have collected data with the help of a questionnaire, which is a primary
source of data collection. A questionnaire was prepared with the help of my project
guide (external) on retail banking in India and a survey was conducted of 100 salaried
people, mainly comprising of bank customers.
2.2 SECONDARY DATA
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Secondary data is data collected by someone other than the user. Common
sources of secondary data for social science include census, surveys,
organizational records and data collected through qualitative methodologies or
qualitative research.
Secondary data analysis saves time that would otherwise be spent collecting data
and particularly in the case of quantitative data, provided larger and higher-
quality databases than would be unfeasible for any individual researcher to
collect on their own. In addition to that, analysts of social and economic change
consider secondary data essential, since it is impossible to conduct a new survey
that can be adequately capture past change and/or developments.
Secondary data can be obtained from two different research strands:
Quantitative :
Census, housing, social security as well as electoral statistics and other
related data bases.
Qualitative :
Semi-structured and interviews, transcripts observation records and
personal, research-related documents are the part of qualitative data.
A clear benefit of using secondary data is that much of the background
work needed has been already carried out. for example: literature
reviews, case studies might have been carried out, published texts and
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statistic could have been already used elsewhere, media promotion and
personal contacts have also been utilized.
This wealth of background work means that secondary data generally
have a pre-established degree of validity and reliability which need not
be re-examined by the researcher who is re-using such data.
Furthermore, secondary data can also be helpful in the research design
of subsequent primary research and can provide a baseline with which
the collected primary data results can be compared to. Therefore, it is
always wise to begin any research activity with a review of the
secondary data.
In this study, the secondary source of data is obtained from:
Journals, research articles, magazines, internet and newspapers and in
some published sources and also from intranet within the company.
Information collected form guidance of project guide and the employees
of the bank to understand the Retail banking better.
Learning various retail lending product which Allahabad bank offers,
their policies and norms by working there.
This all is done to understand retail banking in a better way to work on this
project and to gain knowledge of the subject before any kind of research on
the topic.
2.3 ASSUMPTIONS / HYPOTHESIS
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A process by which an analyst tests a statistical hypothesis or the methodology
employed by the analyst depends on the nature of the data used and the goals of the
analysis. The goal is to either accept or reject the null hypothesis.
Hypothesis testing is used to infer a result of a hypothesis performed on sample data
from a larger population. For example: performing a hypothesis test on sample data in
an attempt to determine the mean of a population is the same as the mean of the sample.
Based on the literature reviewed and based on the previous studies conducted the
assumptions are made to conduct the research work. The following are the hypothesis
used for the survey.
Ist TEST
H0: Customers are aware of the retail banking products.
H1: Customers are not aware of the retail banking products.
2nd TEST
H0: Home loans are the mostly availed loan kind.
H1: Home loans are not the mostly availed loan kind.
3RD TEST
H0:Nationalized banks are preferred.
H1:Nationalized banks are not preferred.
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2.4 SAMPLE DESIGN
A sample design is a definite plan for obtaining a sample from given population. In
sample studies, we have to make a plan regarding the size of the sample, selection of the
sample, collection of the sample data and preparation of the final results based on the
sample study. The whole procedure involved is called the sample design. The term
sample survey is used for a detailed study of the sample. In general, the term sample
survey is used for any study conducted on the sample taken from some real world data.
There are three methods of collecting data such that the information collected can be
used to draw inferences about the target universe. These are:
Collection of data from all enterprises. This is a costly and lengthy procedure
unless the target universe is small.
Collection of data from a sample of units that have been selected from the target
universe with the intention that they should be representative of that universe. A
sample of this kind is referred to as a purposive (or sometimes judgmental)
sample. In order to draw inferences about the target universe using a purposive
sample, a number of assumptions have to be made about the representativeness
of the data collected and of the reporting units and, in general, there are
limitations to the inferences that can be drawn from purposive samples when the
probability of selection is not known.
Collection of data from a random sample of units which have been selected with
known probabilities of selection from among all units in the target universe. In
this case no assumptions about representativeness are needed in estimating totals
or averages for the target universe and, in addition, there are well known
techniques for determining the precision of these estimates. This said, estimates
based on random samples will only be unbiased if the business registers from
which they are drawn are comprehensive and up to date.
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CHART 2.2 TYPES OF SAMPLING
In my study I have used purposive sampling also called NON-PROBABILITY
sampling.
2.5 SAMPLE SIZE
The sample size of the survey done was 100 salaried people, in which Allahabad Bank
customers plus the people from outside were included.
2.6 POPULATION
A statistical population is a set of entities concerning which statistical inferences are to
be drawn, often based on a random sample taken from the population. Population is also
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SamplingTechniques
NonprobabilitySampling
Techniques
ProbabilitySampling
Techniques
Convenien
ceSampling
Judgment
alSampling
Quota
Sampling
Snowba
llSampling
Systematic
Sampling
Stratified
Sampling
ClusterSampli
ng
OtherSampling
Techniques
SimpleRandomSampling
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used to refer to a set of potential measurements or values, including not only case
actually observed but those that are potentially observable.
2.7 METHODS OF DATA COLLECTION
There are various methods of data collection such as:
Observation method
Surveys
Experimentation
Others Techniques if available
The suitable method for this research was survey and the available data in bank records
plus other techniques available.
An interviewer-administered questionnaire is prepared for the purpose; the
questionnaire
is set such a way that it will satisfy all the objectives. Beside the questionnaires are
prepared to get the exact response from the respondents so that it will be easy to do the
hypothesis testing. The questions asked are very simple so that it can be easily
understand by the respondents and it was standardized to ensure reliability. The survey
instrument was developed in such a way that the questions asked would help in efficient
evaluation and to arrive at accurate results.
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CHAPTER - 3
THEORETICAL
BACKGROUND
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RETAIL BANKING
DEFINITION
Retail banking is typical mass-market banking in which individual customers use local
branches of larger commercial banks. Services offered include savings and checking
accounts, mortgages, personal loans, debit/credit cards and certificates of deposit (CDs).
INTRODUCTION
Retail bankingis a banking service that is geared primarily toward individualconsumers. Retail banking is usually made available by commercial banks, as well as
smaller community banks. Unlike wholesale banking, retail banking focuses strictly on
consumer markets. Retail banking entities provide a wide range of personal banking
services, including offering savings and checking accounts, bill paying services, as well
as debit and credit cards. Through retail banking, consumers may also obtain mortgages
and personal loans. Although retail banking is, for the most part, mass-market driven,
many retail banking products may also extend to small and medium sized businesses.
Today much of retail banking is streamlined electronically via Automated Teller
Machines (ATMs), or through virtual retail banking known as online banking.
The concept is not new to banks but is now viewed as an important and attractive
market segment that offers opportunities for growth and profits. Retail banking and
retail lending are often used as synonyms but in fact, the later is just the part of retail
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http://www.investorglossary.com/retail-banking.htmhttp://www.investorglossary.com/retail-banking.htmhttp://www.investorglossary.com/wholesale-banking.htmhttp://www.investorglossary.com/wholesale-banking.htmhttp://www.investorglossary.com/debit.htmhttp://www.investorglossary.com/retail-banking.htmhttp://www.investorglossary.com/retail-banking.htmhttp://www.investorglossary.com/wholesale-banking.htmhttp://www.investorglossary.com/debit.htm -
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banking. In retail banking all the needs of individual customers are taken care of in a
well- integrated manner.
CHARACTERISTICS
Multiple products (deposits, credit cards, insurance, investments and
securities)
Multiple channels of distribution (call center, branch, internet)
Multiple customer groups (customer, small business, and corporate).
SCOPE FOR RETAIL BANKING
All round increase in economic activity.
Increase in the purchasing power. The rural areas have the large purchasing
power at their disposal and this is an opportunity to market Retail banking.
India has 200 million households and 400 million middleclass population more
than 90% of the savings come from the house hold sector. Falling interest rates
have resulted in a shit. Now People Want To Save Less And Spend More.
Nuclear family concept is gaining much importance which may lead to large
savings, large number of banking services to be provided are day-by-day
increasing.
Tax benefits are available for example in case loans the borrower can avail tax
benefits for the loan repayment and the interest charged for the loan.
ADVANTAGES OF RETAIL BANKING
Retail banking has inherent advantages. Advantages are analyzed from the resource
angle and asset angle.
RESOURCE SIDE:
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Retail deposits are stable and constitute core deposits.
They are interest insensitive and less bargaining for additional interest.
They constitute low cost funds for the banks.
Effective customer relationship management with the retail customers built a
strong customer base.
Retail banking increases the subsidiary business of the banks.
ASSETS SIDE:
Retail banking results in better yield and improved bottom line for a bank.
Retail segment is a good avenue for funds deployment.
Consumer loans are presumed to be of lower risk and NPA perception.
Helps economic revival of the nation through increased production activity.
Improves lifestyle and fulfils aspirations of the people through affordable credit.
Innovative product development credit.
Retail banking involves minimum marketing efforts in a demand driven
economy.
Diversified portfolio due to huge customer base enables bank to reduce their
dependence on few or single borrower.
Banks can earn good profits by providing non fund based or fee based services
without deploying their funds.
DISADVANTAGES OF RETAIL BANKING:
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Designing own and new financial products is very costly and time consuming for
the bank.
Customers now-a-days prefer net banking to branch banking. The banks that are
slow in introducing technology-based products, are finding it difficult to retain
the customers who wish to opt for net banking.
Customers are attracted towards other financial products like mutual funds etc.
Though banks are investing heavily in technology, they are notable to exploit the
same to the full extent.
A major disadvantage is monitoring and follow up of huge volume of loan
accounts inducing banks to spend heavily in human resource department.
Long term loans like housing loan due to its long repayment term in the absence
of proper follow-up, can become NPAs.
The volume of amount borrowed by a single customer is very low as compared
to wholesale banking. This does not allow banks to exploit the advantage of
earning huge profits from single customer as in case of wholesale banking.
PRODUCTS OFFERED BY ALLAHABAD BANK
RETAIL BANKING
1. ALLAHABAD BANK HOUSING FINANCE
Eligibility:
Salaried persons, Professionals & Self-Employed and Businessmen
having regular income to liquidate the loans
Age:
Minimum: 21 years
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Maximum: Age of retirement for salaried class & 70 years for others.
Purpose:
For construction of residential house on land already owned.
For purchase of New / Old / Unfinished house/flat and
renovation /extension /repair of the same.
For purchase of plot and construction of house thereon
For renovation / extension / repair of residential house already
owned.
Loan amount:
For salaried persons: Up to 60 times of monthly gross salary
(Maximum: Rs. 200 Lac)
For others: Up to 4 times of gross annual Income.
(Maximum: Rs. 200 Lac)
Nature of Loan: Term Loan
Margin:
For loans up to Rs. 20.00 Lacs - 15% of Project cost.
For loans above Rs. 20.00 Lacs - 20% of Project cost.
Project cost consists of:
Purchase price of land/house/flat.
Cost of construction/renovation/extension (if applicable)
Stamp duty and registrations charges as applicable.
Accrued interest amount of moratorium period, if proposed to be
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capitalized
Premium of Loan Insurance.
2. ALLAHABAD BANK EDUCATION LOAN SCHEME
Eligibility:
Indian National who has secured admission to professional/ technical
courses in recognized institutions in India or Abroad through Entrance
Test/ Merit Based Selection Process after completion of H.S.C. (10 plus2 OR equivalent).
Courses Eligible:
Courses eligible for study in India:
Approved courses leading to Graduate/ Posy-Graduate degree and P.G.
Diplomas conducted by recognized Colleges/ Universities recognized by
UGC/ Govt. / AICTE/ AIBMS/ ICMR etc.
Courses like ICWA, CA, CFA etc.
Courses conducted by IIMs, IITs/ IISc, XLRI, NIFT, NID etc.
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Regular Degree/ Diploma Courses like Aeronautical, Pilot Training,
Shipping etc. approved by Director General of Civil Aviation/ Shipping,
if the course is pursued in India.
Approved courses offered in India by reputed Foreign Universities.
Courses eligible for Study abroad:
Graduation: For Job oriented professional/technical courses offered by
reputed Universities.
Post Graduation: MCA, MBA, MS etc.
Courses conducted by CIMA London, CPA in USA etc.
Regular Degree/ Diploma courses like Aeronautical, pilot training,
shipping etc., the Institute duly recognized by the Competent University/
State Body/ Local Aviation/ Shipping Authority.
Quantum of Loan:
Need based finance subject to repaying capacity of the parents / students with
following ceilings:
Studies in India: Maximum Rs. 10.00 lac
Studies abroad: Maximum Rs. 20.00 lac.
Expenses Considered for Loan:
Fee payable to College / School /Hostel
Examination/Library/Laboratory Fee
Purchase of Books / Equipments/ Instruments/ Uniforms.
Caution Deposit/ Building Fund/ Refundable Deposit supported by
Bills/Receipts of the Institution, subject to the conditions that amount
does not exceed 10% of the total tuition fees for the entire course.
Travel Expenses/Passage Money for studies abroad.
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Purchase of Computers essential for completion of the course at
reasonable cost.
Insurance premium for student borrower.
Any other expenses required to complete the course, such as- Study
Tours, Project Work, and Thesis etc.
Reimbursement of the fee paid at the time of counseling if applied within
60 days from the date of such payment.
Margin:
For loan upto Rs 4.00 lac: NIL
For loan above Rs 4.00 lac:
(i) Studies in India: 5%
(ii) Studies abroad: 15%
Scholarship / Assistantship to be included in Margin.
Margin Money to be brought on year-to-year basis.
3. ALLAHABAD BANK CAR FINANCE SCHEME
Purpose:
Purchase of new Vehicle for personal use/official use
Purchase of pre-owned vehicle, not more than 3 years old
The term Vehicles includes: Car, Van, JEEP, Multi Utility Vehicles (MUVs).
Target Group:
Our existing corporate customers, their directors and employees
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Salaried persons, Professionals & Self-Employed, Businessmen, Firms,
Companies, Agriculturist and Pensioners of Central, State Govt. and our
Bank having regular income to liquidate the loans
Eligibility (Income):
Salaried Person: Minimum gross monthly income of Rs.15, 000/-
Agriculturist: Minimum 5 acres of irrigated land holding
Professional & Self-Employed / Businessmen: An IT assesee. With full
collateral security, IT assessment order / IT return may be waived.
Retired individuals: Drawing monthly pension of Rs 15000/= and above.
Firm/ Companies:Net profit is sufficient to meet repayment of Car Loan
Margin:
For New Vehicle: 15% of the cost of vehicle on Road (i.e. one time
registration + first time Road tax & insurance charges etc.).
For Pre-owned Vehicle -85% of the "Agreed Purchase Price" as valued by
Approved Automobile Valuer or60% of the Valuation of the
Vehicle, whichever is lower.
Eligibility (Service Period of Applicant/ Repayment Age/Age of Firm & Company):
Salaried Person: The loan should be repaid at least three months beforethe
date of retirement from service.
Other than Salaried person: Repaid before attaining the age of 70 years.
Firm/ Companies: should be existent for at least 2 years.
Loan Limit:
Maximum of2.5 times of Net Annual Income / Net Annual Salary.
Income of spouse / father/ mother/ son/ unmarried daughtercan also be
clubbed, provided he/she/they become the co-borrower
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No of vehicle:
Maximum number of Car Loans available:
Individual- 2
Partnership Firms -10
Companies 15
4. ALLAHABAD BANK SARAL LOAN SCHEME
Target Group:
Employees of those reputed public sector / private institutions / organizations, whose
salary are disbursed through our branches or the employer is ready for remitting the
monthly installments from the salary.
Eligibility:
o Permanent employee of the institution / organization
o Minimum net monthly salary - Rs.4000/-.
o Age Minimum 21 years
o Leave balance 45 days.
Purpose:
o 50% of the loan amount for purchase of any consumer durable item / two
wheeler etc. or any other tangible item(s)o Upto 50% of the loan amount for meeting domestic, social, religious and
other exigency expenses.
Loan amount:
o 24 months net salary maximum Rs.7,50,000/-.
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Margin: 10%
Repayment Period: Maximum 60 months
Moratorium: One month
Security:
o Hypothecation of articles being financed and /or other items covering full
value of loan
o Guarantee of spouse and one co-employee OR Guarantee of two co-
employees
o Pledge / Assignment of NSC, KVP, LIP & FDR or Equitable Mortgage
of the property if available/ proposed.
o Bank has launched customer friendly SARAL-2 Scheme recently for
extending loan to the employees whose salary is being disbursed through
Allahabad Bank branch and where no salary tie-up with the employer is
available.
5. ALLAHABAD BANK PERSONAL LOAN FOR BANKERS
Target Group & Eligibility Criteria
All the state Govt., Central Govt., teachers pensioners & family pensioners drawing
monthly pension through our branches or from Post Office/Other Banks.
Definition:
Pension means basic pension plus dearness relief at the time of sanction of credit
facility.
Age:
Must not exceed 73 years as on the date of disbursement of loan.
Purpose:
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For any purpose.
Loan amount:
Up to 10 months pension inclusive of relief subject to the following limit.
Maximum Rs. 2.00 Lac for pensioners up to 65 years of age
Maximum Rs. 1.00 Lac for pensioners above 65 years of age
(Age will be reckoned as on date of sanction of loan)
Minimum Rs. 25000 / -
Margin:
Nil
Repayment Period:
Maximum 48 months
Insurance:
Group Personal Accident Insurance Policy of Rs.75,000/- covering accidental death for
the pensioners availing loan under Personal Loan Scheme for Pensioners.
Disbursement:
By credit to his / her (Principal Borrower) S/B account
Processing Fee:
Nil
Collateral Security:
In case of the borrower drawing pension from our Bank and family pensioner is
alive:
Personal Guarantee of the family pensioner as mentioned in the PPO
For others:
Pledge of NSC / KVP / FDR etc. covering 25% or 50% (subject to the condition
of family pensioners) of loan amount.
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In case the above security/ies stand/s in the name of third party/parties personal
guarantee from him/her/them.
Guarantee from 2 persons having individual net worth equal to two times of loan
amount, preferably from legal heirs / son / spouse / daughter.
OPPORTUNITIES AND CHALLENGES OF RETAIL BANKING IN INDIA
Retail banking has immense opportunities in a growing economy like India. As the
growth story gets unfolded in India, retail banking is going to emerge a major driver.I
have already referred to the BRIC Report talking India as an economic superpower. A.
T. Kearney, a global management consulting firm, recently identified India as the
"second most attractive retail destination" of 30 emergent markets.
The rise of the Indian middle class is an important contributory factor in this regard. The
percentage of middle to high income Indian households is expected to continue rising.
The younger population not only wields increasing purchasing power, but as far as
acquiring personal debt is concerned, they are perhaps more comfortable than previous
generations. Improving consumer purchasing power, coupled with more liberal attitudes
toward personal debt, is contributing to India's retail banking segment.
The combination of the above factors promises substantial growth in the retail sector,
which at present is in the nascent stage. Due to bundling of services and delivery
channels, the areas of potential conflicts of interest tend to increase in universal banks
and financial conglomerates. Some of the key policy issues relevant to the retail banking
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sector are: financial inclusion, responsible lending, access to finance, long-term savings,
financial capability, consumer protection, regulation and financial crime prevention.
First, retention of customers is going to be a major challenge. According to a research
by Reichheld and Sasser in the Harvard Business Review, 5 per cent increase in
customer retention can increase profitability by 35 per cent in banking business, 50 per
cent in insurance and brokerage, and 125 per cent in the consumer credit card market.
Thus, banks need to emphasize retaining customers and increasing market share.
Second, rising indebtedness could turn out to be a cause for concern in the future. India's
position, of course, is not comparable to that of the developed world where household
debt as a proportion of disposable income is much higher. Such a scenario creates high
uncertainty. Expressing concerns about the high growth witnessed in the consumer
credit segments the Reserve Bank has, as a temporary measure, put in place risk
containment measures and increased the risk weight from 100 per cent to 125 per cent in
the case of consumer credit including personal loans and credit cards.
Third, information technology poses both opportunities and challenges. Even with ATM
machines and Internet Banking, many consumers still prefer the personal touch of theirneighbourhood branch bank. Technology has made it possible to deliver services
throughout the branch bank network, providing instant updates to checking accounts and
rapid movement of money for stock transfers. However, this dependency on the network
has brought IT departments additional responsibilities and challenges in managing,
maintaining and optimizing the performance of retail banking networks. Illustratively,
ensuring that all bank products and services are available, at all times, and across the
entire organization is essential for todays retails banks to generate revenues and remain
competitive.
Besides, there are network management challenges, whereby keeping these complex,
distributed networks and applications operating properly in support of business
objectives becomes essential. Specific challenges include ensuring that account
transaction applications run efficiently between the branch offices and data centres.
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Fourth, KYC Issues and money laundering risks in retail banking is yet another
important issue. Retail lending is often regarded as a low risk area for money laundering
because of the perception of the sums involved. However, competition for clients may
also lead to KYC procedures being waived in the bid for new business. Banks must also
consider seriously the type of identification documents they will accept and other
processes to be completed.
CHAPTER - 4
DATA
PROCESSING
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4.1 DATA PROCESSING
Do you know what retail banking is?
Responses No. of recipients Percentages
YES 54 54
NO 46 46
TABLE 4.1 Consumer Responses towards retail banking awareness
Consumer awareness about retail banking
CHART 4.1
YES
54%
NO
46%
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Hence, its proved that consumer at present are aware of retail banking products. As
54% have said that they know what retail banking is.
What is your monthly salary?
Mainly the survey conducted by me had middle income group persons, which tells us
that mainly the people using retail banking services at large consists of middle class
population of India and this in turn is helping the sector to grow at rapid state.
Have you ever taken any loan?
Responses Percentages
Yes 95%
No 04%
Dont know 01%
Table 4.2 Percentages of people who has ever availed any kind of loan
CHART 4.2
95%
4%1%
Yes
No
Don't Know
The study above shows that loan is a very famous item in Indian household.
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Which type of loan was it?
Type of loan Percentage
Home Loan 40%
Vehicle Loan 28%
Educational Loan 17%
Personal Loan 15%
TABLE 4.3
40%
28%
17%
15%
Home Loan
Vehicle Loan
Educational
Loan
Personal
Loan
CHART 4.3
As we can see that according to the study and survey conducted, home loans share thehighest percentage. So we can say that home loans are most availed loan kind.
If you have taken loan, which kind of bank was it?
Type of bank Percentage
Nationalized 55%
Private sector 45%
TABLE 4.4
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CHART 4.4
55%
45%
Public Sector
Bank
Private Sector
Bank
So from above data, we can see the most preferred type of banks by common Indian
men are those nationalized banks, which also proves the third hypothesis test which
states that nationalized banks are preferred banks, thus rejecting the alternativehypothesis.
Do you have a debit/ credit card?
Responses Percentage
Yes 99%
No 01%
TABLE 4.5
CHART 4.5
99%
1%
Yes
No
From above we can see the percentage of people having debit or credit cards with them.
Thus showing the awareness of people and for them and how important retail banking is
for people.
4.2 ANALYSIS
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As per the above data, we can see that retail banking is an important part of people in
India. From credit cards or debit cards to loan for house to car or even for furnishing
home has been taken by people. Home is the most famous of all thus it plays a major
role for banks.
Also as public sector or nationalized banks are available everywhere or should say in
every town of the town of the country. They share a major part of banking sector, but
being more famous among people they lack behind the private banks in their facilities
and customer service.
There are 22.5 crore debit cards n the country and while nine of ten transactions are
done at the ATMs, only one transaction is done directly at the merchant establishment.
Now, priority is to make consumers aware of the electronic payment scheme.
The opportunity in India for electronic payments is huge. First, if you look at Indias
personal consumer expenditure (PCE), or the amount spent on a card on an average, it is
only 3% compared to the global average of 16%.
New channels like internet and mobile will help accelerate cashless payments andelectronic mode of disbursement will be a key to ensure the right person receives the
right amount.
Debit card users are growing at a rapid pace in India, closely following the penetration
level of the telecom sector. The volume of debit card transactions in India is expected to
touch 47 crore per year by 2011, with a cumulative transaction value of over Rs 19,369
crore, on account of the increased interest shown by consumers.
The main driver for the growth of debit cards in emerging markets is the increasing
number of people with access to full banking services. Debit card numbers have risen
substantially in markets such as Brazil and India, a study conducted by American
payment processing company First Data said, citing estimates released by Euro monitor
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International. In 2010, there will be 40.7 crore debit card transactions in India, totaling
Rs16,697 crore in transaction value, the study estimates.
CHAPTER - 5
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MANAGEMENT
LESSONS
MANAGEMENT LESSONS
During my summer internship at Allahabad bank and while conducting the survey I
went through different problems everyday and managing all those had a chance to study
different management lessons from this experience. They are:
1. Keep your approach friendly
People are not looking to make friends at work, but refraining from an aggressive
approach towards your employees is a good idea.
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2. Be diplomatic and assertive in your approach
One should be diplomatic in its approach at work which means along with being
friendly the decisions taken should not be dependent on it and also assertiveness for
taking any decisions should be there.
3. Authority that you need before you start work on your project
When taking on a new project / responsibility at work, convey to your management the
extent of authority you need in order to effectively execute youe project.
4. Dont sit on the heads of your team members
Nobody appreciates micro-manager, so never ever force your team members, try and
keep them motivated.
5. Keep track of progress.
Progress record should be kept so that if any changes required can be made.
6. Manage people
More difficult than it sounds, but it should be done so as to get desired results.
7. Personality
Its one of the most important aspect, ones personality affects by and large the team
members and should try and maintain a good personalty.
8. Initiative
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For any work in organizationstaking initiative to work is one of the very important
aspects in management.
9. Charisma to influence others.
10. Commitment
11. Result oriented approach.
12. Optimistic attitude.
13. Self-confident while working in organizations.
14. Ability to read between lines so as to understand the underlying meaning.
15. Should learn to see the big picture, means should have a futuristic view.
16. Goals setting should be done in every project.
17. Flexibility
While it is a good thing to be firm and stand by your decisions. It is important that you
are flexible enough to realize when plans need to change.
18. Look beyond money.
There should be an effort by the manager, project manager, or business executive to
determine what the non monetary interests of the key players are.
19. Say Thanks
Offer words of support, and show appreciation for good work.
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20. People generally wont work for people who just dont care for them
Reward your key players as often as possible its good to keep them motivated and keep
their zeal alive.
21. Rewarding works better than nagging.
A reward can be something as simple as a coin or a note of appreciation- as long as your
employees perceive it as a symbol of recognition, it works.
22. You are accountable for your task/ project.
However, this does not mean that you do not delegate. Delegate work to your team
members, let them know that they are accountable for their assignments and ensure that
they have the resources so that they can deliver successfully. Decide the plan of action
beforehand, and decide how follow-ups will happen.
23. Clear, open communication is a prerequisite for a healthy, result- orientedwork environment.
If you have open communication its easy to know what are the problems faced by your
employees in the organization thus leading to better results.
24. Keep them posted.
A lack of information is a fertile ground for rumor, gossip and insecurity. Keep the team
in the loop about information concerning and affecting them.
25. when in doubt, ask.
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Dont refrain from asking stupid questions- they may save miscommunication and
misunderstandings, resulting in saved time and money.
26. Be open.
While you should not be a dumping ground for grievances, you SHOULD be accessible
enough for team members to openly discuss concerns or delays. (Tip: If you are not
open, youll find out about the concern or delay later in the game when there is less time
to fix it.)
27. Break down work into tasks.
Breaking down the project into smaller tasks (and mini tasks if required) ensures that
you have a systematic approach.
28. Keep it visible and visual.
Plotting a chart or graph about work progress and tacking it in a prominent place on
your soft board (or keeping the softcopy on your desktop) ensures that your progress isvisible.
29. Manage conflict.
Conflicts should be managed especially within the team at an early stage- before it
reaches crisis proportions.
30. Look beyond money.
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There should be an effort by the manager, project manager or business executive to
determine what the non monetary interest of the key players are. Translated to a family
situation, dont sit smug thinking that you are doing your bit by bringing in the bacon.
Your family needs more than that from you- your attention and interest, for instance.
CHAPTER - 6
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FINDINGS
MAJOR FINDINGS
Retail lending across the globe has been a showcase in the commercial banking
sector. India has emerged as potential markets with huge investment
opportunities.
The higher growth of retail lending in emerging economies is attributable to fast
growth of personal wealth, favorable demographic profile, rapid development in
information technology, the conducive macro- economic environment, financial
market reforms and several micro level supply side factors.
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The retail banking strategies of banks are undergoing major transformation, as
banks adopt a mix of strategies like organic growth, acquisitions and alliances.
This has resulted in a paradigm shift in the marketing strategies of the banks.
Public sector banks players are adopting aggressive strategies, leveraging theirbranch network and their customer base to earn a larger share of the retail price.
Banks are also going in for innovative strategies like cross selling and packaged
selling of retail products. At the same time, new foreign players are also entering
this high growth sector.
PSBs need to fundamentally strategies institutional skill levels especially in sales
and marketing, service operations, risk management and the overall
organizational performance ethic. The last, i.e., strengthening human capital will
be the single biggest challenge.
Old private sector banks also have the need of fundamentally strengthen skill
levels.
However, even more imperative is their need to examine their participation in
the Indian banking sector and their ability to remain independent in the light of
the discontinuities in the sector.
New private banks could reach the next level of their growth in the Indian
banking sector by continuing to innovate and develop differentiated business
models to profitable serve segments like the rural / low income and affluent/
HNI segments; actively adopting acquisitions as a means to grow and reaching
the nest level of performance in their service platforms.
Attracting, developing and retaining more leadership capacity would be key to
achieving this and would pose the biggest challenge.
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CHAPTER 7
RECOMMEDATIONS
RECOMMENDATIONS
To increase consumer satisfaction bank can try and improve on their services.
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As people dont know much about all the procedures to avail loan so it should be
explained properly to them.
Some improvisations can be made in loan disbursement policy.
As home loan shave the highest market share it can be made more attractive to
raise income.
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CHAPTER - 8
CONCLUSION
CONCLUSION
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There is a need of constant innovation in retail banking. In bracing for tomorrow, a
paradigm shift in bank financing through innovative products and mechanisms
involving constant up gradation and revalidation of the banks internal systems and
processes is called for. Banks now need to use retail as a growth trigger. This requires
product development and differentiation, innovation and business process reengineering,
micro-planning, marketing, prudent pricing, customization, technological up gradation,
home/ electronic/ mobile banking, cost reduction and cross selling.
While retail banking offers phenomenal opportunities for growth, the challenges are
equally daunting. How far the retail banking is able to lead growth of the banking
industry in future would depend upon the capacity building of the banks to meet the
challenges and make use of the opportunities profitably.
However, the kind of technology used and the efficiency of operations would provide
the much needed competitive edge for success in retail banking business. Furthermore,
in all these customers, interest is of paramount importance. The banking sector in India
is demonstrating this and I do hope they would continue to chart in this traded path.
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BIBLIOGRAPHY
www.iimcal.ac.in/community/finclub/dhan/dhan6
wikipedia.org/wiki/retail_banking www.investorwords.com/4229/retail_banking.html
www.bharatbook.com/general/retail_banking.asp
www.dib.ae/en/personalbanking_productservices.htm
www.allahabadbank.com
BOOKS REFFERED
Qualitative Research: An Introduction to Methods and Designs by
Stephen D. Lapan
Bhattacahrya D.K, 2003, Research Methodology, 1st Edition (Reprint
2004, 2005). New Delhi: Excel Books Publication.
Kothari C.R, 1985, Research Methodology, 2nd Edition (reprint 2006).New Delhi: New Age International (P) limited, Publishers.
ANNEXURE
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http://www.iimcal.ac.in/community/finclub/dhan/dhan6http://www.investorwords.com/4229/retail_banking.htmlhttp://www.bharatbook.com/general/retail_banking.asphttp://www.dib.ae/en/personalbanking_productservices.htmhttp://www.iimcal.ac.in/community/finclub/dhan/dhan6http://www.investorwords.com/4229/retail_banking.htmlhttp://www.bharatbook.com/general/retail_banking.asphttp://www.dib.ae/en/personalbanking_productservices.htm -
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QUESTIONNAIRE ON RETAIL BANKING IN INDIA
Name:
Age:
Sex:
1. Do you know about what retail banking is?
Yes { }
No { }
2. What is your monthly salary?
25000-35000 { }
35000-45000 { }
Above 50000 { }
3. Have you ever taken any loan?
Yes { }
No { }
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4. Which type of loan was it?
Home loan { }
Vehicle loan { }
Education loan { }
Personal loan { }
Saral loan { }
5. If you have taken loan which kind of bank was it?
Private bank { }
Public bank { }
6. Do you have a credit / debit card?
Yes { }
No { }
7. If private bank select from option?
HDFC { }
ICICI { ]
AXIS { }
HSBC { }
OTHERS { }
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8. If public bank select from option?
ALLAHABAD BANK { }
IDBI BANK { }
BANK OF INDIA { }
OTHERS { }
9. Are you aware of bank policies?
Yes { }
No [ }
10. Do you take advice before taking loan from bank personnel or friends?
Bank personnel { }
Friends { }
11. Are you satisfied by the loan procedure of banks?
Yes { }