Project Report on Hdfc Bank

Project report on

hdfc bank

1

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

8

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,

16

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

18

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

22

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

25

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

29

http://www.hdfcbank.com/aboutus/awards/default.htm#%23















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

30

(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

31

(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

33

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.




3. Years in business: 4 to 7 years depending on profession

4. Minimum Annual Income: Rs. 100000 p.a.


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.




3. Years in business: 5 yrs continuous business experience

4. Minimum Annual Income: Rs. 1, 00,000 p.a.

5. Available in select cities


1. Proof of Identity (Passport Copy/ Voters ID card/ Driving Licence)



40




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. .


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







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


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

http://www.hdfcbank.com/personal/loans/loan_against_securities/loan_securities.htm

http://www.hdfcbank.com/personal/loans/two_wheeler_loans/two_wheeler.htm

http://www.hdfcbank.com/personal/loans/two_wheeler_loans/two_wheeler.htm

http://www.hdfcbank.com/personal/loans/new_car_loans/new_car.htm

http://www.hdfcbank.com/personal/loans/personal_loans/personal_loans.htm


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