Project report on
hdfc bank
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EXECUTIVE SUMMARY
The role of financial institution is ever expanding and is becoming inseparable part of
the growth of the country. There are many financial products coming everyday to the
Indian market. Some are old and some are new from Indian context. However,
there are some products have presence in the country since long, like Saving A/c,
Current A/c, Fixed Deposit, various types of loans(personal loan, vehicle loan, home
loan) etc. But in the era of Globalizations and with free entry of lot of private players
this product need some modification. So, in the current situation lots of different and
attractive products regarding loan, Saving A/c, Current A/c, and Fixed Deposits are
available with this Financial Institutions.
Now to avail such kind of Product’s detailed knowledge Bhavnagar University,
Bhavnagar arranged six week summer project in any business organization for
sharpen our skills & to bridge to gap of the theory & practice. I completed my project
at HDFC Bank, Bhavnagar.
This is a specialized training project report prepared at HDFC Bank, which consist of
detailed analysis on the topic of “Analysis of customer behavior towards
personal loan market & comparison among top 3 banks “In first part of this
project I highlighted brief introduction of Industry and information HDFC bank. This
include Brief introduction about the Bank. Founder and director of the bank, structure
of the bank etc. So this section includes brief history about HDFC Bank.
In second part of the project, I get detailed knowledge about the different products
and services of the HDFC Bank. In this section I highlight different loans of HDFC
Bank Ltd. Plus I highlight different products of the HDFC Bank. In addition to this I
presented different aspects of personal loan..
In last and most important part is a Research Analysis made by me on the topic ”
Analysis of customer behavior towards personal loan market & comparison
among top 3 banks “ with the help of 200 sample size.
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INDEX
CHAPTER NO. NAME OF CHAPTERS PAGE NO.
CHAPTER 1 INDUSTRY PROFILE 7
1.1 What is banking? 8
1.2 Structure of Indian banking industry 10
1.3 Current scenario 17
CHAPTER 2 PROFILE OF HDFC BANK 20
2.1 About HDFC Group 21
2.2 List of Enterprise 22
2.3 About HDFC Bank 24
2.4 History of the Banks 26
2.5 Mission 27
2.6 Goal and Objectives 27
2.7 Organizational culture and values 28
2.8 Board of directors 29
2.9 Awards & Achievement 31
2.10 Products of the Bank 32
2.11 Org. chart of HDFC at Bhavnagar branch 35
2.12 ATM in Bhavnagar 38
2.13 Map of the Bhavnagar-HDFC Bank Branch 39
2.14 Various loans provided by HDFC Bank 40
CHAPTER 3 INTRODUCTION OF PERSONAL LOANS 58
3.1 Introduction 59
3.2 Types of personal Loans 61
3.3 Types Of Interest Rates 66
3.4 Personal Loans Interest Comparison Chart 68
3.5 Personal Loan Process 703.6 Factors that influence loan rate 71
CHAPTER 4PROFILE OF BANKS SELECTED FOR
COMPARISON 73
4.1 ICICI Bank 74
4.2 SBI Bank 79
CHAPTER 5 RESEARCH METHODOLOGY 82
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CHAPTER 6 FINDINGS 86
CHAPTER 7 ANALYSIS 115
CHAPTER 8 SUGGESTIONS 117
CHAPTER 9 CONCLUSION 119
CHAPTER 10 ANNEXURE 121
CHAPTER 11 BIBLIOGRAPHY 125
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Chapter 1
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1.1 WHAT IS BANKING?
Bank is a business that provides financial services usually for profit.
Traditional banking Services include receiving deposits of money, lending money
and processing transactions. A commercial bank accepts deposits from customers
and in turn makes loans based on those deposits. Some banks (called Banks of
issue) issue banknotes as legal tender. Many banks offer ancillary financial services
to make additional profit; for example: selling insurance products.
Banking is the business of providing financial services to consumers and
businesses. The basic services a bank provides are checking accounts, which can
be used like money to make payments and purchase goods and services; savings
accounts and time deposits that can be used to save money for future use; loans
that consumers and businesses can use to purchase goods and services; and basic
cash management services such as check cashing and foreign currency exchange.
Four types of banks specialize in offering these basic banking services: commercial
banks, savings and loan associations, savings banks, and credit unions. A broader
definition of a bank is any financial institution that receives, collects, transfers, pays,
exchanges, lends, invests, or safeguards money for its customers.
This broader definition includes many other financial institutions that are not usually
thought of as banks but which nevertheless provide one or more of these broadly
defined banking services. These institutions include finance companies, investment
companies, investment banks, insurance companies, pension funds, security brokers
and dealers, mortgage companies and real estate investment trusts. This article,
however, focuses on the narrower definition of a bank and the services provided by
banks in Canada and the United States. (For information on other financial
institutions, see Insurance; Investment Banking; and Trust Companies.) Banking
services are extremely important in a free market economy such as that found in
Canada and the United States. Banking services serve two primary purposes. First,
by supplying customers with the basic mediums-of-exchange (cash, checking
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accounts, and credit cards), banks play a key role in the way goods and services are
purchased.
Second, by accepting money deposits from savers and then lending the money to
borrowers, banks encourage the flow of money to productive use and investments.
This in turn allows the economy to grow. Without this flow, savings would sit idle in
someone’s safe or pocket, money would not be available to borrow, people would
not be able to purchase cars or houses, and businesses would not be able to build
the new factories the economy needs to produce more goods and grow. Enabling
the flow of money from savers to investors is called financial intermediation, and it is
extremely important to a free market economy.
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1.2 STRUCTURE OF INDIAN BANKING INDUSTRY
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Organized banking was active in India since the establishment of the General Bank
of India in 1786. After independence, the Reserve Bank of India (RBI) was
established as the central bank and in 1955, the Imperial Bank of India, the biggest
bank at the time, was taken over by the government to form state-owned State Bank
of India (SBI). RBI had undertaken an exercise to merge weak banks to strong banks
and the total number of banks thus reduced from 566 in 1951 to 85 in 1969.
With the objective of reaching out to masses and meeting the credit needs of all
sections of people, the government nationalized 14 large banks in 1969 followed by
another 6 banks in 1980. This period saw enormous growth in the number of
branches and the banks’ branch network became wide enough to reach the weakest
sections of the society in a vast country like India. Sib’s network of 9033 domestic
branches and 48 overseas offices is considered to be one of the largest for any bank
in the world.
The economic reforms unleashed by the government in early nineties included
banking sector too, to a significant extent. Entry of new private sector banks was
permitted under specific guidelines issued by RBI. A number of liberalization and de-
regulation measures aimed at consolidation, efficiency, productivity, asset quality,
capital adequacy and profitability have been introduced by the RBI to bring Indian
banks in line with International best practices. With a view to giving the state-owned
banks operational flexibility and functional autonomy, partial privatization has been
authorized as a first step, enabling them to dilute the stake of the government to 51
per cent. The government further proposed, in the Union Budget for the financial
year 2000-01, to reduce its holding in nationalized banks to a minimum of 33 per
cent on a case by case basis.
The banking system can be broadly classified as organized and unorganized
banking system. The unorganized banking system comprises of moneylenders,
indigenous bankers, lending pawnbrokers, landlords, traders, etc. Whereas the
organized banking system comprises of Scheduled Banks and Non-Scheduled
Banks that are permitted by RBI to undertake banking business.
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The Indian Banking Industry can be broadly classified into:
A. Public Sector Banks
B. Old and New Private Sector Banks
C. Foreign Banks
D. Co-operative Banks
A. Public Sector Banks
Public sector banks are banks where in the government has a holding of
100%.This been a situation prior to liberalization. The stake has fallen because of a
public issue in the post liberalization period. Some of the other leading banks in
this segment have also proposed to come out with an equity issue to raise further
capital. The government is proposing to bring out a bill wherein its share in all
these banks would stand reduced to 33% from the current levels
The public sector banks largely dominate the Indian Banking industry. These banks
till the early 90s were involved in the traditional banking business of deposits and
credit lending. The public sector banks have a strong distribution network all over
the country. But the strength of the earlier periods has now become a concern for
these banks. As compared to the tech-equipped distribution network of the new
private sector banks and the foreign banks, these banks have found it difficult to
upgrade them on the technology front. These banks are also facing the problem of
surplus manpower. Most of these banks are now coming out with a VRS to bring
down their number of employees and improve the efficiency ratios.
The public sector banks still control a major share in the banking operations of the
country. Their inefficiencies have been exposed only when the market was thrown
open for competition and new players started eating up their share. But given their
size and the strong network, most of these banks can change their perception. The
recent thrust on reduction of government stake; VRS, NPA settlement schemes etc
have been some of the steps in this direction. Since the growth of the economy is
largely dependent on the performance of these banks, even with the growth of new
private and foreign players, these banks will have an important role to play.Some of
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the players here are State Bank of India and its associates, Bank of Baroda,
Corporation Bank, Punjab National Bank, Union Bank of India, etc.
B. Old and New Private Sector Banks
Ø Private Sector Banks-Old
These banks existed prior to the promulgation of Banking Nationalization Act but
were not nationalized due to their smaller size and regional focus. Most of these
banks continue to have a regional focus and are relatively smaller in size. A large
number of these banks are basically from the south. Being small in size, these
banks focus on service and technology and thus face competition from new private
and foreign banks. Most of these banks are trying to increase their presence
nationwide and are planning to enter other business areas like insurance.
The old private sector banks have performed reasonably well during the FY2000.
As these banks were facing stiff competition from the new private banks and the
foreign players who were making inroads in their markets,
these banks have been able to increase their net profits by over 50%. As a result of
the increasing competition in the sector, these banks have been trying to improve
upon their margins and asset quality. Most of these banks have a high CAR and as
such they do not face any capital constraint in their growth plans. Even their return
on net worth has been at par in most of the cases with the other new players in the
market. But the coming years would be more challenging for these banks as the
public sector are also trying to adapt to the new environment and the new banks
have already equipped themselves to have a major share in any opportunity that
would accrue.
Some of the private sector-old players are Bank of Madura Ltd., Tamilnad
Mercantile Bank Ltd., The Jammu & Kashmir Bank Ltd., The Vysya Bank Ltd., etc.
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Ø Private Sector Banks- New
The Banking Regulation Act was amended in 1993 permitting the entry of new
private sector banks. The act also specified certain criteria for establishing new
private sector banks. The criteria are as follows:
1. The banks should have a minimum net worth of Rs1bn.
2. The promoters holding should be minimum 25% of the paid up capital.
3. The banks should offer shares to the public within three years of their
operations.
The first new private sector bank started operations in 1995. The minimum net
worth requirement of Rs1bn and difficulty in getting the banking license has kept
the option open for very few players.
The financial institutions have promoted many of these banks. With emphasis on
service and technology, it is for the first time that Indian banks are challenging the
foreign banks. These banks are making heavy use of technology to give good
service on par with foreign banks but to a much wider audience e.g. branch size
has been reduced considerably by using technology and having less manpower.
This saves the cost of the branch. In addition the ATM etc helps drawing large
customers to one branch.
The new private banks have been consistently gaining market share from the
public sector banks. The major beneficiary of this has been corporate clients who
are most sought after now.
The new private sector banks have performed very well in the FY2000.Most of this
banks have registered an increase in net profits of over 50%.They have been able
to make significant inroads in the retail market of the public sector and the old
private sector banks. During the year, the two leading banks in this sector had set a
new trend in the Indian banking sector. HDFC Bank, as a part of its expansion
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plans had taken over Times Bank. ICICI Bank became the first bank in the country
to list its shares on NYSE.
Some of the private sector-new players include, Centurion Bank Ltd., Global Trust
Bank Ltd., HDFC Bank., ICICI Banking Corporation Ltd., IDBI Bank Ltd., etc.
C. Foreign Banks
Foreign banks have been doing the normal banking business in the country. During
the period of nationalization, the entry of new foreign banks and expansion by
existing foreign banks were prohibited. Even, when the norms were relaxed later
on, RBI was very slow in granting any further approvals to these banks. But most of
these banks have concentrated on the metropolitan cities of the country and have
been able to do reasonably well. These banks have used the latest technology to
compensate for the limited number of branches they have.
In the post liberalization period, there has been a sharp increase in the total
business done by the foreign banks. A number of new players have entered and
the existing players have consolidated their position in the market. In the last
couple of years, some of the foreign banks have entered the retail segment and
introduced a number of new products in the market. This has intensified the
competition in the banking sector and has made most of the old players rethink
their strategy.
Some of the foreign banks operating in India are ABN-AMRO Bank N.V., ANZ
Grind lays Bank Ltd, Citibank N.A., Deutsche Bank AG, Standard Chartered Bank,
etc.
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D.Co-Operative Banks
Co-operative banks are a part of the vast and powerful superstructure of co-
operative institutions, which are engaged in the tasks of production, processing,
marketing, and distribution, servicing, and banking in India. The co-operative banks
were conceived in order to substitute unorganized money market agencies like
moneylenders, to provide adequate short-term and long-term institutional credit at
reasonable rates of interest, and to bring about integration of the unorganized and
organized segments of the money market.
The main aim of the co-operative banks is to provide cheaper credit to their
members, and not to maximize their profits. There has been an impressive growth
in deposits, credit and working capital of these banks. The annual rates of growth
of co-operative banks have been quite high, and are comparable with those of
commercial banks. The government and the RBI have taken a number of steps to
improve the health and strength of co-operative banks in India. In keeping with
other financial sectors reforms, certain co-operative banking reforms also have
been carried out after 1991.
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1.3 CURRENT SCENARIO
A.PUBLIC SECTOR BANKS
SBI Group: State Bank of India with its seven associates banks command the largest
banking resource in India. SBI and its associate’s banks are:
1 State Bank of India
2 State Bank of Bikaner & Jaipur
3 State Bank of Hyderabad
4 State Bank of Indore
5 State Bank of Mysore
6 State Bank of Patiala
7 State Bank of Saurashtra
8 State Bank of Travancore
After the amalgamation of new bank of India with Punjab national bank, currently
there are 18 nationalized banks in India:
> Allahabad bank > Syndicate Bank
> Andhra bank > Union Bank of India
> Bank of Baroda > United Bank of India
> Bank of Maharashtra > UCO Bank
> Canara bank > Vijaya Bank
> Central bank of India > Indian Overseas Bank
> Corporation bank > Oriental Bank Of Commerce
> Dena bank > Punjab and Sind Bank
> Indian bank > Punjab National bank
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B.PRIVATE SECTOR BANKS
Ø Bank of Rajasthan > ING Vysya Bank
Ø Indian Overseas Bank > Jammu & Kashmir Bank
Ø Catholic Syrian Bank > Karnataka Bank
Ø Centurion Bank of Punjab > Karur Vysya Bank
Ø Dhanalaxmi Bank > Kotak Mahindra Bank
Ø Federal Bank > South Indian Bank
Ø HDFC Bank > Tamilnad Indian Bank
Ø ICICI Bank > Axis Bank
Ø IDBI Bank > Indusind Bank
C.FOREIGN BANKS
Ø ABN AMRO Bank > Deutshce Bank
Ø Abu Dhabi Commercial Bank Ltd > HSBC
Ø Bank of Ceylon > JPMorgan Chase Bank
Ø BNP Paribas Bank > Standard Chartered Bank
Ø Citi Bank > Scotia Bank
Ø China Trust Commercial Bank > Taib Bank
Currently (2009), overall, banking in India is considered as fairly mature in terms of
supply, product range and reach-even though reach in rural India still remains a
challenge for the private sector and foreign banks. Even in terms of quality of assets
and capital adequacy, Indian banks are considered to have clean, strong and
transparent balance sheets-as compared to other banks in comparable economies in
its region. The Reserve Bank of India is an autonomous body, with minimal pressure
from the government. The stated policy of the Bank on the Indian Rupee is to
manage volatility-without any stated exchange rate-and this has mostly been true.
With the growth in the Indian economy expected to be strong for quite some time-
especially in its services sector, the demand for banking services-especially retail
banking, mortgages and investment services are expected to be strong. M&As,
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takeovers, asset sales and much more action (as it is unraveling in China) will
happen on this front in India.
In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its
stake in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an
investor has been allowed to hold more than 5% in a private sector bank since the
RBI announced norms in 2005 that any stake exceeding 5% in the private sector
banks would need to be vetted by them.
Currently, India has 88 scheduled commercial banks (SCBs) - 28 public sector banks
(that is with the Government of India holding a stake), 29 private sector banks (these
do not have government stake; they may be publicly listed and traded on stock
exchanges) and 31 foreign banks. They have a combined network of over 53,000
branches and 17,000 ATMs.
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Chapter 2
2.1 ABOUT HDFC GROUP
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If ever there was a man with a mission it was Hasmukhbhai Parekh, Founder and
Chairman-Emeritus, of HDFC Group who left this earthly abode on November 18,
1994. Born in a traditional banking family in Surat, Gujarat, Mr. Parekh started his
financial career at Harkisandass Lukhmidass – a leading stock broking firm. The firm
closed down in the late seventies, but, long before that, he went on to become a
towering figure on the Indian financial scene.
In 1956 he began his lifelong financial affair with the economic world, as General
Manager of the newly-formed Industrial Credit and Investment Corporation of India
(ICICI). He rose to become Chairman and continued so till his retirement in 1972.
At the ripe age of 60, Hasmukhbhai started his second dynamic life, even more
illustrious than his first. His vision for mortgage finance for housing gave birth to the
Housing Development Finance Corporation – it was a trend-setter for housing
finance in the whole Asian continent.
He was also a writer in his own right. There are over 200 published articles by him.
In 1992, the Government of India honored him with the Padma Bhushan Award. The
London School of Economics & Political Science conferred on him an Honorary
Fellowship. He was one of the Founder Members of the Centre for Advancement of
Philanthropy, and it’s Chairman till 1993.
2.2 LIST OF ENTERPRISES
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Ø Enterprises under common control of the promoter:
HDFC Bank Ltd.
HDFC Asset Management Company Ltd.
HDFC Standard Life Insurance Company Ltd.
HDFC Developers Ltd.
HDFC Holdings Ltd.
HDFC Investments Ltd.
HDFC trustee Company Ltd.
HDFC Finance Ltd.
HDFC Chubb General Insurance Company Ltd.
HDFC Venture Capital Ltd.
REGISTERED OFFICE: CORPORATE OFFICE:
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Address: Address:
HDFC Bank House Ramon House, 169, Back Bay,
Senapati Bapat Marg Lower Parel, Reclamation,
Mumbai, H T Parekh Marg,
Maharashtra, Church Gate,
400013. Mumbai 400 020.
Phone: 91-022-56521000
Fax: 91-022-24960737
BHAVNAGAR BRANCH
HDFC BANK LTD.
Sterling Point,
Waghawadi Road,
Bhavnagar- 364002.
Websites
Www. hdfc.com
Www. hdfcbank.com
2.3 ABOUT HDFC BANK
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The Housing Development Finance Corporation (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, as part of RBI's liberalization of the Indian Banking
industry in 1994. The Bank was incorporated in August 1994 in the name of 'HDFC
Bank Limited' with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995
HDFC Bank, the pioneer of the retail-banking movement in India, is one of the
fastest growing and most profitable banks in India with a strong urban presence. The
bank, with a market share of 2.5% has a wide reach across the country with a
branch network of 425 branches and 950 ATMs. Strong understanding of the retail
sphere (46% of total advances in 9mFY05) and technology initiatives has made the
bank the second largest private sector bank in the country. The bank has largely
outpaced the sector growth over the last few years, but of late the growth momentum
has been subdued due to competitive reasons.
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable
network of over 250 branches spread over 135 cities across the country. All
branches are linked to each other through an online real- time basis. Customers in
80 locations are also serviced through Phone Banking. The Bank's expansion plans
take into account the need to have a presence in all major industrial and commercial
centers where its corporate customers are located as well as the need to build a
strong retail customer base for both deposits and loan products. Being a
clearing/settlement bank to various leading stock exchanges, the Bank has branches
in the centers where the NSE/BSE has a strong and active member base.
The Bank also has a chain of over 800 networked ATMs across these cities.
Moreover, HDFC Bank's ATM network can be accessed by all domestic and
international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American
Express credit/charge cardholders.
HDFC Bank operates in a highly automated environment in terms of information
technology and communication systems. The entire bank's branches have
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connectivity which enables the bank to offer speedy funds transfer facilities to its
customers. Multi-branch access is also provided to retail customers through the
branch network and Automated Teller Machines (ATMs).
The Bank has made substantial efforts and investments in acquiring the best
technology available internationally to build the infrastructure required for a world-
class bank. In terms of software, the Corporate Banking business is supported by
Flex cube, while the Retail Banking business by Fin ware, both from i-flex Solutions
Ltd. The systems are open, scalable and web-enabled.
The Bank has prioritized its engagement in technology and the internet as one of its
key goals and has already made significant progress in web- enabling its core
businesses. In each of its businesses, the Bank has succeeded in leveraging its
market position, expertise and technology to create a competitive advantage and
build market share.
The Bank has received recognition both nationally and internationally for 'The Best
Bank' on various parameters in publications like Euro money and Finance Asia.
The Bank's IT department has total staff strength of 120 (approx.), with a mix of
functional and technical specialists. The project managers for new IT initiatives are
designated both from this group and from businesses. Almost all the project
development and application maintenance activities are outsourced to IT vendors.
2.4 HISTORY OF THE BANK
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HDFC was incorporated in 1977 with the primary objective of meeting a social need
– that of promoting home ownership by providing long-term finance to households for
their housing needs. HDFC was promoted with an initial share capital of Rs. 100
million.
Against the milieu of rapid urbanization and a changing socio-economic scenario, the
demand for housing has grown explosively. The importance of the housing sector in
the economy can be illustrated by a few key statistics. According to the National
Building Organization (NBO), the total demand for housing is estimated at 2 million
units per year and the total housing shortfall is estimated to be 19.4 million units, of
which 12.76 million units is from rural areas and 6.64 million units from urban areas.
The housing industry is the second largest employment generator in the country. It is
estimated that the budgeted 2 million units would lead to the creation of an additional
10 million man-years of direct employment and another 15 million man-years of
indirect employment.
MILE STONES
Ø Acquired Times Bank in merger from Times Of India Group (5 – 6% present
holding) in 2000.
Ø HDFC owns only 24.4%, rest owned by public and private equity investors JP
Morgan Chase (5 -6%).
Ø Large Foreign Institutional Investors (in India) including Putnam, etc. (big vote
in Indian equity markets) – 10-11%
Ø Warburg Pincus has a significant holding in HDFC (its promoter)
Having identified housing as a priority area in the Ninth Five Year Plan (1997-2002),
the National Housing Policy has envisaged an investment target of Rs. 1,500 billion
for this sector. In order to achieve this investment target, the Government needs to
make low cost funds easily available and enforce legal and regulatory reforms.
2.5 MISSION
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“HDFC Bank's mission is to be a world-class Indian Bank. The Bank's aim is to build
sound customer franchises across distinct businesses so as to be the preferred
provider of banking services in the segments that the bank operates in and to
achieve healthy growth in profitability, consistent with the bank's risk appetite. The
bank is committed to maintain the highest level of ethical standards, professional
integrity and regulatory compliance. HDFC Bank's business philosophy is based on
four core values: Operational Excellence, Customer Focus, Product Leadership and
People.”
2.6 GOAL AND OBJECTIVES
Business Objectives
The primary objective of HDFC is to enhance residential housing stock in the country
through the provision of housing finance in a systematic and professional manner,
and to promote home ownership. Another objective is to increase the flow of
resources to the housing sector by integrating the housing finance sector with the
overall domestic financial markets.
Organizational Goals
Ø Develop close relationships with individual households,
Ø Maintain its position as the premier housing finance institution in the country,
Ø Transform ideas into viable and creative solutions,
Ø Provide consistently high returns to shareholders, and
Ø To grow through diversification by leveraging off the existing client base.
2.7 ORGANIZATIONAL CULTURE & VALUES
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HDFC Bank has an open and informal culture. HDFC Bank has value integrity,
commitment and teamwork and excellence in customer service. HDFC adopts a
policy of “learning by doing“which encourages decision making as well as learning
from doing.
As HDFC Bank continue to grow rapidly in spite of the competitive market scenario,
young professionals opting to make a career with HDFC Bank today will find more
challenging and exciting opportunities to contribute and grow with them.
If you are young, talented individual who enjoys challenges, has a passion to excel
and can fit into our organizational culture & value system, you could be a part of
learning and growing team of professionals at HDFC Bank.
HDFC Bank has always been market-oriented and dynamic with respect to resource
mobilization as well as its lending programmed. This renders it more that capable to
meet the new challenges that have emerged. Over the years, HDFC Bank has
developed a vast client base of borrowers, depositors, shareholders and agents, and
it hopes to capitalize on this loyal and satisfied client base for future growth. Internal
systems have been developed to be robust and agile, to take into account changes
in the volatile external environment.
HDFC Bank has developed a network of industries through partnerships with some
of the best institutions in the world, for providing specialized financial services. Each
institution fine tuned for a specific market, while offering the entire HDFC customer
base the highest standards of quality in product design, facilities and services.
2.8 BOARD OF DIRECTORS
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ORGANISATION AND MANAGEMENT
HDFC is a professionally managed organization with a board of directors consisting
of eminent persons who represent various fields including finance, taxation,
construction and urban policy & development. The board primarily focuses on
strategy formulation, policy and control, designed to deliver increasing value to
shareholders.
Board of Directors
SHARE HOLDING PATTERN
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BOARD OF DIRECTORS
Managing Director Mr.Aditya Puri
Director Mr.Arvind Pande
Director Mr.Ashim Samanta
Director Mr.C M Vasudev
Director Mr.Gautam Divan
Executive Director Mr.Harish Engineer
Chairman Mr.Jagdish Capoor
Director Mr.Keki M Mistry
Director Mr.Pandit Palande
Executive Director Mr.Paresh Sukthankar,
Director Mr.Renu Karnad
Director Mr.Vineet Jain
Share Holding Pattern
Indian Promoters24.20%
Foreign collaborators13.10%
Indian inst/Mut Fund2.10%
FIIs/GDR26.90%
Free float33.70%
Shareholders215,630
HDFC has a staff strength of 1029, which includes professionals from the fields of
finance, law, accountancy, engineering and marketing.
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2.9 AWARDS & ACHIEVEMENT
Euro money Awards 2009: 'Best Bank in India'
Economic Times Brand Equity & Nielsen Research annual survey 2009: Most
Trusted Brand - Runner Up
Asia Money 2009 Awards: 'Best Domestic Bank in India'
IBA Banking Technology Awards 2009: 'Best IT Governance Award -
Runner up'
Global Finance Award: 'Best Trade Finance Bank in India for 2009
IDRBT Banking Technology Excellence Award 2008: 'Best IT Governance
and Value Delivery'
Asian Banker Excellence in Retail Financial Services: 'Asian Banker Best
Retail Bank in India Award 2009 '
Finance Asia Country Awards for Achievement 2008: 'Best Bank and Best
Cash Management Bank'
CNN-IBN: 'Indian of the Year (Business)'
Nasscom IT User Award 2008: 'Best IT Adoption in the Banking Sector
Business India: 'Best Bank 2008'
Forbes Asia: Feb. 50 companies in Asia Pacific
Asian Banker Excellence in Retail Financial Services: Best Retail Bank 2008
Asia money: Best local Cash Management Bank Award voted by
Corporate
Microsoft & Indian Express Group: Security Strategist Award 2008
World Trade Center Award of honor: For outstanding contribution to
international trade services
Business Today-Monitor Group survey: One of India's "Most Innovative
Companies"
Financial Express-Ernst & Young Award: Best Bank Award in the Private
Sector category
Global HR Excellence Awards - Asia Pacific HRM Congress; 'Employer
Brand of the Year 2007 -2008' Award - First Runner up, & many more
Business Today: 'Best Bank' Award
2.10 PRODUCTS OF THE BANK
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SAVINGS ACCOUNTS
These accounts are primarily meant to inculcate a sense of saving for the future,
accumulating funds over a period of time. Whatever your occupation, we are
confident that you will find the perfect banking solution. Open an account in your
name or register for one jointly with a family member today.
TYPES OF SAVINGS ACCOUNTS
(1) Regular
(2) Savings Max
(3) Institutional Savings
(4) No frills
(5) Senior citizens A/C.
(6) Kids advantage
(7) Corporate Salary
TYPES OF SALLARY ACCOUNTS
(1) Classic
(2) Regular
(3) Payroll
(4) Premium
CURRENT ACCOUNTS
Now, with an HDFC Bank Current Account, experience the freedom of multi-city
banking! You can have the power of multi-location access to your account from any
of our 684 branches in 316 cities. Not only that, you can do most of your banking
transactions from the comfort of your office or home without stepping out.
TYPES OF CURRENT ACCOUNTS
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(1) Regular
(2) Current Plus
(3) Current Trade
(4) Current Premium
(5) Bank Flexi
(6) Bank Apex
(7) Bank Max
FIXED DEPOSITS
Long-term investments form the chunk of everybody's future plans. An alternative to
simply applying for loans, fixed deposits allow you to borrow from your own funds for
a limited period, thus fulfilling your needs as well as keeping your savings secure.
(1) Regular fixed deposits
(2) Super saver fixed deposits
(3) Sweep in fixed deposits
(4) 5 year tax savings fixed deposits
DEMAT ACCOUNT
HDFC BANK is one of the leading Depository Participant (DP) in the country with
over 8 Lac Demat accounts.
HDFC Bank Demat services offers you a secure and convenient way to keep track of
your securities and investments, over a period of time, without the hassle of handling
physical documents that get mutilated or lost in transit.
HDFC BANK is Depository participant both with -National Securities Depositories
Limited (NSDL) and Central Depository Services Limited (CDSL).
NRI ACCOUNTS
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(1) NRE savings account
(2) NRO savings account
CARDS
Our range of Cards helps you meet your financial objectives. So whether you are
looking to add to your buying power, conducting cashless shopping or budgeting
your expenditure, you will find a card that suits you.
CREDIT CARDS
(1) Silver Card
(2) Gold Card
(3) Platinum Card
(4) Titanium Card
(5) Women’s gold credit card
DEBIT CARDS
(1) Easy shop international debit card
(2) Easy shop gold debit card
PREPAID CARDS
(1) Forex Plus card
(2) Gift Plus card
INVESTMENT AND INSURANCE
(1) Mutual Funds (3) Bonds
(2) Insurance (4) Mudra Gold Bar
2.11 ORG. CHART OF HDFC AT BHAVNAGAR
BRANCH32
P.B. Authorisor : Mr.Hitesh Shah ABM for Current a/c: Mr. Himanshu Trivedi
IRM : Mr. Kamlesh Pipal Teller Authorizer : Mr. Vijay Bhalani
Relationship Manager: Mr. Keyur Jani
Branch Manager
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Managing direct Mr. Aditya puri
Country Head Retail Banking Mr. Navin Puri
Reagional Business HeadMr. Ravi Narayan
Zonal Head Mr. Pinal Shah
Cluster Head Saurashtra Reagion
Mr.Pankaj Popat
Branch Manager (Bhavnagar Branch)Mr. Chetan Trivedi
P.B. Authorisor
Relationshi
p Mana
ge
Assistant Branch Manage
r For Current
a/c
Investment
Relationship
Manager
Teller Authoriso
r
Personal Banker Teller Authorizer Clearinghouse Sales Authorizer Executive
Personal Banker Teller
Functions
Branch manager
Ø Require approval from BM for transaction more than 50,000 RS.
Ø organising coordinating and motivating employees in the organization.
Ø Develop his territory.
Personal Banker authorizer
Ø After his approval, all the applications collect and checked by PB, Executives go
for further process to branch manager.
Ø -Daily stock (welcome kit, debit pin number, cheque book, and debit card)
requires approval of PB authorizer.
Personal Banker
Ø Maintain contacts with walk-in customers, existing customers and provide
satisfactory service to them.
34
Ø Handle all the complaint of the customers and resolve it.
Ø Maintain daily stock reports and take approval from the PB authorizer.
Teller Authorizer
Ø He gives approval to all types cheques and DDs by checking all the details and
validity of it.
Ø At the end of the day all the cash on hand in the bank require signature of him.
Ø Report of cash loading in ATM is to be submitted to him. He is responsible for it.
TellerØ Maintain daily transactions of cheque withdrawal, cheque deposits, cash
withdrawal cash deposit, fund transfer and DD etc.
Ø Check the validity of all the above transactions.
Clearinghouse
Ø All the cheques are being transferred to this department and it checks the sign,
balance amount in his/ her a/c, date of issuing.
Ø It also maintains the transaction with other branches and banks.
Ø DRF forms are being handled by this department.
Sales Executive
Ø Generate new inquiries by cold calling and tele marketing.
Ø Handle existing and new customers.
Ø Maintain customer relationships.
2.12 ATM IN BHAVNAGAR
35
Address Dr. Kapasis Hospital,
Opp City Bus Stand, Down Chowk
Bhavnagar
Bhavnagar – 364001
Gujarat
AddressGopi Arcade
Opp Thakteshwar Post Office
Waghawadi
Bhavnagar - 364002
Gujarat
AddressShop No. 1 ,
Prithvi Complex
Kalanala
Bhavnagar – Gujarat
AddressShop No. 6
Prithvi Plaza, Ground Floor
Ghogha Circle
Bhavnagar -
Gujarat
AddressShop No. H / 82
Akshardeep Complex
Shastrinagar
Bhavnagar -
Gujarat
36
2.13 MAP OF THE BHAVNAGAR-HDFC BANK
BRANCH
37
2.14VARIOUS LOANS PROVIDED BY HDFC
BANK
1. Personal Loan
Ø Features & Benefits
1) Borrow up to Rs 15, 00,000 for any purpose depending on your
requirements.
2) Flexible Repayment options, ranging from 12 to 60 months.
3) Repay with easy EMIs.
4) One of the lowest interest rates.
5) Hassle free loans - No guarantor/security/collateral required.
6) Speedy loan approval.
7) Convenience of service at your doorstep.
8) Customer privileges
If you are an HDFC Bank salary account holder, we have a
special offer for you
If you are an existing Auto Loan customer with a clear repayment
of 12 months or more from any of our approved financiers or us,
you can get a hassle free personal loan (without income
documentation).
If you are an existing HDFC Bank Personal Loan customer with
a clear repayment of 12 months or more, we can Top-Up your
personal loan.
9) Credit Shield
In case of death or total permanent disability of the loanee, the
loanee/nominee can avail of the Payment Protection Insurance (Credit Shield)
which insures the principle outstandings on the loan up to a maximum of the
loan amount. Principle outstanding is defined as the amount of loan
outstanding (not including any arrears in payment or interest thereon) at the
38
Date of Loss, having accounted for payments made and interest accruing as
determined in the Policy. Hence, the amount covered does not include any
principal added because of non - payment of EMI and also will not include
interest/ accrued charges.
10)Personal Accident Cover
In order to ensure that your family is taken care of we also offer a Personal
Accident cover of Rs.2, 00,000 at a nominal premium.
Salaried Individuals include Salaried Doctors, CAs, employees of select
Public and Private limited companies, Government Sector employees
including public sector undertakings and central, state and local bodies:
Ø Eligibility Criteria
1. Minimum age of Applicant: 21 years
2. Maximum age of Applicant at loan maturity: 60 years
3. Minimum employment: Minimum 2 years in employment and
minimum 1 year in the current organization
4. Minimum Net Monthly Income: Rs. 10,000 per month (Rs. 15,000 in
Mumbai, Delhi, Bangalore, Chennai and Hyderabad & Rs. 12,000 in
Calcutta, Ahmadabad and Cochin)
Ø Documents required
1. Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence)
2. Address Proof (Ration card Tel/Elect. Bill/ Rental agr. / Passport
copy/Trade licence /Est./Sales Tax certificate)
3. Bank Statements (latest 3 months bank statement / 6 months bank
passbook)
4. Latest salary slip or current dated salary certificate with latest Form
16
39
Self employed (Professionals) include self - employed Doctors, Chartered
Accountants, Engineers, MBA Consultants, Architects, and Company
Secretaries.
Ø Eligibility Criteria
1. Minimum age of Applicant: 25 years
2. Maximum age of Applicant at loan maturity: 65 years
3. Years in business: 4 to 7 years depending on profession
4. Minimum Annual Income: Rs. 100000 p.a.
Ø Documents required
1. Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence).
2. Address Proof (Ration card Tel/elect. Bill/ Rental agr. / Passport
copy/Trade licence /Est./Sales Tax certificate).
3. Bank Statements(latest 6 months bank statement /passbook)
4. Latest ITR along with computation of income, B/S & P&L a/c for the
last 2 yrs. certified by a CA
5. Qualification proof of the highest professional degree
Self Employed (Individuals) include self-employed - Sole proprietors, Partners &
Directors in the Business of Manufacturing, Trading or Services.
Ø Eligibility Criteria
1. Minimum age of Applicant: 21 years
2. Maximum age of Applicant at loan maturity: 65 years
3. Years in business: 5 yrs continuous business experience
4. Minimum Annual Income: Rs. 1, 00,000 p.a.
5. Available in select cities
Ø Documents required
1. Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence)
2. Address Proof (Ration card Tel/elect. Bill/ Rental agr. / Passport
copy/Trade licence /Est./Sales Tax certificate)
40
3. Bank Statements(latest 6 months bank statement /passbook)
4. Latest ITR along with computation of income, B/S & P&L a/c for the
last 2 yrs. certified by a CA
5. Proof of continuation (Trade licence /Establishment /Sales Tax
certificate)
6. Other Mandatory Documents (Sole Prop. Decl. Or Cert. Copy of
Partnership Deed, Cert. Copy of MOA, AOA & Board resolution.)
Self Employed (Pvt Cos and Partnership Firms) include Private
Companies and Partnership firms in the Business of Manufacturing, Trading
orServices. .
Ø Eligibility Criteria
1. Years in business: Minimum of 3 years in current business and 5
years total business experience
2. Business must be profit making for the last 2 years
3. Minimum Annual Income: Rs 100000 p.a.
4. Available in select cities
Ø Documents required
1. Address Proof (Ration card Tel/elect. Bill/ Rental agr. / Passport
copy/Trade licence /Est./Sales Tax certificate)
2. Bank Statements(latest 6 months bank statement /passbook)
3. Latest ITR along with computation of income, B/S & P&L a/c for the
last 2 yrs. certified by a CA
4. Proof of continuation (Trade licence /Establishment /Sales Tax
certificate)
5. Other Mandatory Documents (Sole Prop. Decl. Or Cert. Copy of
Partnership Deed, Certified true copy of Memorandum & Articles of
Association (certified by Director) & Board resolution (Original)
41
2. SmartDraft-Overdraft against salary
SmartDraft is an unsecured overdraft facility offered to HDFC Bank's
corporate salary account holders. The facility operates in the form of
additional funds in the account, for use during short-term exigencies. Our
corporate salary account holders can avail of Overdraft facility of up to 3 times
the salary
Ø Features & Benefits
1. Overdraft limit up to 3 times the salary
2. Minimum documentation
3. No pre-closure charges
4. Easy-to-use and easy-to-pay facility
5. Freedom to use limit through Cheque book, ATM, online
transfer, etc.
6. Interest payable on the amount utilized
7. Credits in the account set-off utilization and help save interest
8. Easy documentation
9. Limit will be set on the existing account
10.Non EMI based facility
42
3.Home loans
Ø Home Loans Features & Benefits
1. Home Loan - Home loans for individuals to purchase (fresh / resale) or
construct houses. Application can be made individually or jointly. HDFC finances
up to 85% maximum of the cost of the property (Agreement value + Stamp duty
+ Registration charges) based on the repayment capacity of the customer.
2.Home Improvement Loan - HIL facilitates internal and external repairs and
other structural improvements like painting, waterproofing, plumbing and electric
works, tiling and flooring, grills and aluminum windows. HDFC finances up to
85% of the cost of renovation (100% for existing customers) subject to market
value of the property.
3.Home Extension Loan - HEL facilitates the extension of an existing dwelling
unit. All the terms are the same as applicable to Home Loan.
4.Land Purchase Loan - Be it land for a dream house, or just an investment for
the future, HDFC Land Purchase Loan is a convenient loan facility to purchase
land. HDFC finances up to 85% of the cost of the land. Repayment of the loan
can be done over a maximum period of 15 years.
5.Choose from Fixed Rate or Floating Rate with options to structure your loan
as Partly Fixed or Partly Floating.
6.Flexible repayment options to suit your individual needs.
7.Loan cover Term Assurance Plan - HDFC Standard Life Insurance Company
Ltd. offers an insurance plan*, which is designed to ensure that life's
uncertainties do not affect your family's interests and your precious home.
43
LCTAP provides a lump-sum payment on the unfortunate demise of the life
assured.
8.Automated Repayment of Home loan EMI - You can give us standing
instructions to repay your Home Loan EMIs directly from your HDFC Bank
Savings Account, thus, saving you the trouble of procuring, signing and tracking
post-dated cheques.
9. HDFC also offers In-house scrutiny of Property documents for your
complete peace of mind.
10.Customer privileges - If you are an existing HDFC Home Loan customer
you can avail of other loans (such as Personal Loans, Car Loans, Two- wheeler
Loans and Loan against securities) at lower interest rates.
4.Two Wheeler Loan
44
Ø Features & Benefits
1. Flexible repayment options, ranging from 12 to 48 months available even
at the point of purchase.
2. Repay through post-dated cheques with easy EMIs. Calculate your EMI
3. Hassle free loans - No guarantor required.
4. Speedy loan approval.
5. Available for almost all models at attractive interest rates.
6. Free gifts from time to time on approval of your Two Wheeler Loan.
(Watch this space for more details on the free gift promotion).
5.1 OBJECTIVE OF STUDY
To know the concept of personal loan very well and also to know the
awareness about it in Bhavnagar.
To analyze customer’s selection criteria for providers of personal
loans.
To find out customers’ decision making process for personal loans..
To obtain opinion of general public about the services and facilities
provided by different banks.
To acquire a practical work experience out of the project and take the
opportunity to relate knowledge with the actual practices adopt by the
organization.
To know how they deal with their customers.
To study the banking habits of people by the way of analyzing the
existing trends in the market.
5.2 NATURE OF STUDY
The nature of this research study is descriptive and convenience one. These
kinds of research are very flexible, convenient and done by simple survey.
45
5.3 TYPES OF DATA
There are main two types of data:
(1) Primary data: which are collected for the first time and thus happen to be
in original in character.
(2) Secondary data: which have already been collected by someone in the
past.
PRIMARY DATA
Primary data contains details in the direct conversation or contact with the
concern person about the respective topic or section. Such people should be
executive, staff member, customers, operating heads, businessmen, personal
loan holder etc. conversation could take in the form of questionnaire, general
talk, etc. where the view is to immediately take data by way of writing or any
other form.
SECONDARY DATA
Secondary research contains the collection of data through various indirect and
readymade forms like books, magazines, brochures, annual reports, etc. here
the information is collected from the data available on internet, annual reports,
banking related books, brochures, and through indirect talk with the official
person of bank.
5.4 RESEARCH INSTRUMENT
Questionnaire is used as a data collection instrument for collecting the primary
data by taking personal opinion of the customer in the field. A questionnaire
consists of a number of question printed or typed in definite order on a form or
46
set of form. I used both open and close ended questionnaire.
MERITS OF THIS METHOD :
There is low cost even when the universe is large and is widely spread
geographically.
It is free the bias of the interviewer; answers are in respondent’s own
words.
Respondents have adequate time to give well thought own answer.
It is used even respondents are illiterate.
LIMITATION
The control over questionnaire may be lost once it is sent.
There is also the possibility of ambiguous replies or omission of replies
altogether to certain questions: interpretation of omissions is difficult.
This method is quite expensive.
This method is time consuming.
It is difficult to know whether willing respondents are truly
representative.
This method needs trained and also enthusiastic persons.
5.5 SAMPLING PLAN
SAMPLE SIZE:
The sample size is 200 personal loan holders.
UNIVERSE:
The sample universe is total number of customers of personal loans in
Bhavnagar city.
SAMPLE UNIT:
The sample unit is single customer in Bhavnagar respectively.
47
SAMPLING METHOD:
The samples are selected by using convenience sampling method.
5.6 LIMITATIONS OF RESEARCH
It is difficult to know whether willing respondents are truly responsive
or not.
This method of collection of data is quite slow and hence time
consuming.
The research cannot be accurate if the people can select more than
one option given to them.
Universe is only one city and in that particular selected area so it
cannot give accurate results.
Chapter 6
48
6.1 FIN
49
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