1

A
Project Study Report
On
Training Undertaken at

HDFC Bank Ltd

Titled

RETAIL LOAN & PARA BANKING

PRODUCT IN HDFC BANK LTD.
Submitted in partial fulfillment for the
Award of degree of
MASTER OF BUSINESS ADMINISTRATION

Submitted by

Submitted to
Mrs. Dhwani Mishra

Abhimanyu Singh Rathore

MBA Part IV

Faculty Member
2007-2009

IILM Academy Of Higher Learning, Jaipur Campus

(Affiliated to the University of Raj. & Raj. Technical University,
Approved by AICTE, Ministry of HRD, Govt. of India)

Preface
Its my pleasure and delight to bring out a comprehensive and concise study in
organization about RETAIL BANKING System. This study will help in identifying
the strength and weakness of the BANKING and also working a quick
comparison with ICICI Bank. It will help in taking strategic decision.
Im highly grateful to Mr. Amit Sharma and my helping co trainees.
There are innumerable persons who have contributed in brining out this study
report of Banking System in India with Specific reference to HDFC Bank Ltd.

Acknowledgement
I express my sincere thanks to my project guide Mrs. Dhwani Mishra
Branch Manager HDFC Bank Ltd. for guiding me right from the inception
till the successful completion of the project. I sincerely acknowledge him
for extending their valuable guidance, support for literature, critical reviews
of project and the report and above all the moral support he had provided
to me with all stages of this project.
I would like to thank supporting staff Javed, Maneesh Sharma, Mrs. Neetu
Sharma, Aalok Sharma, Ashok Sharma for their help and cooperation
trough out our project.

(Signature of the Student)

Abhimanyu Singh Rathore

EXECUTIVE SUMMARY
This project report presented contains detail my summer training assignment.
This is a part of my curriculum of M.B.A. program (2007 2009) Rajasthan
Technical University. The Project is based on Retail and Para Baniking in
HDFC Bank.
The main of this project is to deal with customer Various Loan product including
Para Banking Products and their queries in HDFC, Jaipur and also to find the
Market share of Bank in comparison to other banking companies. The aim of this
project was evaluating and managing the Loan Segment among customers on
different parameters, creating awareness about the various plans of the HDFC
and generating leads for future business prospects.
Bright highlight of the methodology used for the survey project: 1) Filling the questionnaires by various individuals, which are given by my
project guide.
2) Sampling on cluster random basis.
3) Coding
4) Analysis
5) Final report construction
In the current business scenario, to know about the competitors marketing
policies and schemes is equally important as emphasizing on companys own
policies.

CONTENTS
S.No.
1.

Details
Industry Profile

Page No
Page 1

2.

Introduction to Organization
2.1. Introduction to HDFC Ltd.
2.2. Company Profile
2.3. Payment Gateway
2.4. Merchant Product Offering

Page 2 - 14

3.

Research Methodology
3.1. Title of the study
3.2. Duration Of the Project
3.3. Objective of the Study
3.4. Type of Research
3.5. Sample Size and method of selecting sample
3.6. Scope of Study
3.7. Limitation of Study

Page 15 19

Page 20 -

4.

FACTS AND FINDINGS

5.

ANALYSIS AND INTERPRETATION

6.

SWOT ANALYSIS

Page 99

7.

CONCLUSION

Page 100

8.

RECOMMENDATION AND SUGESSIONS

Page 101

9.

APPENDIX

Page 102

0.

BIBLIOGRAPHY

Page 104

52
Page 53 98

Introduction to
Industry

POS (Point of Sale)

Point of sale or point of service (POS or PoS) can mean a retail shop, a checkout
counter in a shop, or the location where a transaction occurs. By synecdoche
point of sale often refers to a POS terminal or more generally to the hardware
and software used for checkouts the equivalent of an electronic cash register.
Point of sale systems are used in supermarkets, restaurants, hotels, stadiums,
and casinos, as well as almost any type of retail establishment.

Early software
Early electronic cash registers (ECR) were programmed in proprietary software
and were very limited in function and communications capability. In August 1973
IBM announced the IBM 3650 and 3660 Store Systems that were, in essence, a
mainframe computer packaged as a store controller that could control 128 IBM
3653/3663 Point of Sale Registers. This system was the first commercial use of
client-server technology, peer to peer communications, Local Area Network
(LAN) simultaneous backup, and remote initialization. By mid-1974, it was
installed in Pathmark Stores in New Jersey and Dillards Department Stores.
Programmability allowed retailers to be more creative. In 1979 Gene Mosher's
Old Canal Cafe in Syracuse, New York was using POS software written by
Mosher that ran on an Apple II to take customer orders at the restaurant's front
entrance and print complete preparation details in the restaurant's kitchen. In that
novel context, customers would often proceed to their tables to find their food
waiting for them already. This software included real time labor and food cost
reports. In 1986 Mosher used the Atari ST and bundled NeoChrome paint to
create and market the first graphical touchscreen POS software.

Hardware interface standardization

8
Vendors and retailers are working to standardize development of computerized
POS systems and simplify interconnecting POS devices. Two such initiatives are
OPOS and JavaPOS, both of which conform to the UnifiedPOS standard led by
The National Retail Foundation.
OPOS, short for OLE for POS, was the first commonly-adopted standard and
was created by Microsoft, NCR Corporation, Epson and Fujitsu-ICL. OPOS is a
COM-based interface compatible with all COM-enabled programming languages
for Microsoft Windows. OPOS was first released in 1996. JavaPOS was
developed by Sun Microsystems, IBM, and NCR Corporation in 1997 and first
released in 1999. JavaPOS is for Java what OPOS is for Windows, and thus
largely platform independent.

Communication command protocols

There are several communication protocols POS systems use to control
peripherals. Among them are
* EPSON Esc/POS
* UTC Standard
* UTC Enhanced
* AEDEX
* ICD 2002
* Ultimate
* CD 5220
* DSP-800
* ADM 787/788.
There are also nearly as many proprietary protocols as there are companies
making POS peripherals. EMAX, used by EMAX International, was a
combination of AEDEX and IBM dumb terminal.

Most POS peripherals, such as displays and printers, support several of these
command protocols in order to work with many different brands of POS terminals
and computers.

Web Based POS

Web based POS can run it on any computer with an Internet connection, without
software installations or updates required. It runs on secure servers in multiple
data centers with real-time backups.

The restaurant industry

A typical example of modern, touch screen, Restaurant Point of Sale software
Hospitality point of sale systems have revolutionized the restaurant industry. This
is particularly found in fast food service and sales. A number of restaurant chains
employ systems which use computer networks. In the most recent technologies,
registers are virtual computers, sometimes using touch screens. They will
connect to a server, often referred to as a "store controller" or a "central control
unit." Printers and monitors are also found on the network. Additionally, remote
servers will connect to store networks and monitor sales and other store data.
The efficiency of such systems have decreased service times and increased
efficiency of orders.
Currently, POS systems are manufactured and serviced by several firms; see
point of sale companies category. Point of sales systems in restaurant
environments operate on DOS, Windows or Unix environments. They can use a
variety of physical layer protocols, though Ethernet is currently the preferred
system.

10
In the fast food industry, a number of configurations may be used in able to aid in
the speed of operations. Registers themselves may be in front counter, drive
through or walk through cashiering and ordertaking modes. Front counter
registers will take and serve orders at the same terminal. Drive through registers
will allow orders to be taken at one or more drive through windows and cashiered
and served at another. In addition to registers, drive through and kitchen monitors
may be used by store personnel to view orders. Once orders appear they may be
deleted or recalled by "bump bars", small boxes which have different buttons for
different uses. Drive through systems are often enhanced by the use of drive
through wireless (or headset) systems which enable communications with drive
through speakers.

11

BANKING STRUCTURE IN INDIA

Scheduled Banks in India

(A) Scheduled Commercial Banks

Public sector
Banks

Private sector
Banks

(28)
(27)
Nationalized Old Private
Bank
Banks
Other Public New
Sector Banks
Private
(IDBI)
Banks
SBI and its
Associates

Foreign
Banks in
India
(29)

Regional Rural
Bank
(102)

(B) Scheduled Cooperative Banks

Scheduled Urban Cooperative
Banks (55)

Scheduled State Cooperative

Banks (31)

Here we more concerned about private sector banks and competition among them.
Today, there are 27 private sector banks in the banking sector: 19 old private sector
banks and 8 new private sector banks.

12
These new banks have brought in state-of-the-art technology and aggressively
marketed their products. The Public sector banks are facing a stiff competition
from the new private sector banks.
The banks which have been setup in the 1990s under the guidelines of

the

Narasimham Committee are referred to as NEW PRIVATE SECTOR BANKS.

New Private Sector Banks

Superior Financial Services
Designed Innovative Products
Tapped new markets
Accessed Low cost NRI funds
Greater efficiency

INDIAN BANKING INDUSTRIES

The Indian banking market is growing at an astonishing rate, with assets
expected to reach US$1 trillion by 2010. An expanding economy, middle class,
and technological innovations are all contributing to this growth.
The countrys middle class accounts for over 320 million people. In correlation
with the growth of the economy, rising income levels, increased standard of
living, and affordability of banking products are promising factors for continued
expansion.

13

The Indian banking Industry is in the middle of an IT revolution, Focusing

on the expansion of retail and rural banking. Players are becoming
increasingly customer - centric in

their approach, which has resulted in

innovative methods of offering new banking products and services.

are now realizing

Banks

the importance of being a big player and are beginning

to focus their attention on mergers

and acquisitions to take advantage of

economies of scale and/or comply with Basel II

regulation.Indian banking

industry assets are expected to reach US$1 trillion by 2010 and are poised to
receive a greater infusion of foreign capital, says Prathima Rajan, analyst in
Celent's banking group and author of the report.

The banking industry should

focus on having a small number of large players that can compete globally
rather than having a large number of fragmented players."

14

UPCOMING FOREIGN BANKS IN INDIA

By 2009 few more names is going to be added in the list of foreign banks in
India. This is as an aftermath of the sudden interest shown by

Reserve Bank

of India paving roadmap for foreign banks in India greater freedom in India.
Among them is the world's best private bank by
Switzerland's UBS.

The following are the list of foreign banks going to set

up business in India :

Royal Bank of Scotland

Switzerland's UBS
US-based GE Capital
Credit Suisse Group
Industrial and Commercial Bank of China

EuroMoney magazine,

15

Introduction to
Organization

16

Introduction to HDFC Bank Ltd

HDFC Bank was incorporated in August 1994 in the name of 'HDFC Bank
Limited', with its registered office in Mumbai, India. The Bank commenced
operations as a Scheduled Commercial Bank in January 1995.
The Housing Development Finance Corporation Limited (HDFC) was amongst
the first to receive an 'in principle' approval from the Reserve Bank of India (RBI)
to set up a bank in the private sector, as part of the RBI's liberalization of the
Indian Banking Industry in 1994.
Headquartered in Mumbai, HDFC Bank, has a network of over 531 branches
spread over 228 cities across India. All branches are linked on an online real-time
basis. Customers in over 120 locations are serviced through Telephone Banking.
The Bank also has a network of about over 1054 networked ATMs across these
cities. 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 has won many awards for its excellent service. Major among them
are "Best Bank in India" by Hong Kong-based Finance Asia magazine in 2005
and "Company of the Year" Award for Corporate Excellence 2004-05.

HDFC Limited.
FC is India's leading housing finance institution and has helped build more than
23,00,000 houses since its incorporation in 1977. In Financial Year 2003-04 its
assets under management crossed Rs. 36,000 Cr. As at March 31, 2004,
outstanding deposits stood at Rs. 7,840 crores. The depositor base now stands
at around

1 million depositors. Rated 'AAA' by CRISIL and ICRA for the 10th

consecutive year Stable and experienced management High

service standards

Awarded The Economic Times Corporate Citizen of the year Award for its longstanding, commitment to community development. Presented the 'Dream Home'

17
award for the best housing finance provider in 2004 at the third Annual Outlook
Money Awards.

About the Company

Helping Indians experience the joy of home ownership.
The road to success is a tough and challenging journey in the dark where only
obstacles light the path. However, success on a terrain like this is not without a
solution.
As we found out over two decades ago, in 1977, the solution for success is
customer satisfaction. All you need is the courage to innovate, the skill to
understand your clientele and the desire to give them your best.
Today, over a million satisfied customers whose dream we helped realise, stand
testimony to our success.
Our objective, from the beginning, has been to enhance residential housing stock
and promote home ownership.
Now, our offerings range from hassle-free home loans and deposit products, to
property related services and a training facility.
We also offer specialised financial services to our customer base through
partnerships with some of the best financial institutions worldwide.

Background
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.

18
Over the past two decades, HDFC has been making inroads into varied spheres
of development, while retaining a focus on low-income

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..

Organisational Goals
HDFC' s main goals are to
a) Develop close relationships with individual households,
b) Maintain its position as the premier housing finance institution in the country,
c) Transform ideas into viable and creative solutions,
d) Provide consistently high returns to shareholders, and
e) To grow through diversification by leveraging off the existing client base.

Company Profile
The company has done away with structural hierarchy, so the front- runner does
not need to seek permission to interact with the CEO of the company. The type of
communication is also two ways i.e. communication follows both vertical and
horizontal type thereby providing maximum interaction and flow of information.
The activities of the different functional departments are directed in such a way
that it meets the goals of the organization. The various activities of the company
are well coordinated, organized and directed and at the same time integrated
too. Decision-making has been made at the Headquarter level.

19

Overview
For Merchants, the world over, accepting payments through cards; both
debit and credit, is an easy and cost effective way to enhance business,
increase revenue, and improve efficiency.
As an acquirer, HDFC Bank makes accepting credit and debit cards easy.
Our valued merchant establishments can now accept all credit and debit
cards issued under the Visa, Visa Electron, MasterCard and Maestro
brands. Our service is backed by superior technology infrastructure and
personalised support from a designated relationship officer.
We offer card acceptance solutions both on EDC machine and on the
Internet through our Payment Gateway product.

Why Merchant Services ?

With HDFC bank Merchant Services, you can offer your customers the

convenience of paying with cards and Reduce transaction time

Have freedom of accepting exact amounts- e.g. an amount of

1297.67 can be easily accepted on card but is quite inconvenient to accept

in cash.

Reduce manual errors in cash counting and collection.

Increase customer retention by offering customers standing

instructions

payment

options

on

their

cards

to

make

recurring

payments. Customers do not need to come to your billing center every

month for making recurring payments

Options of accepting payments on regular EDC (Electronic Data Capture)

Terminals, through your ECR (Electronic Cash Registers) or through the website.

20

Features & Services:

Speed and Accuracy of Transactions
HDFC bank Merchant Services offers latest technology EDC machines
a n d p a ym e n t g a t e w a y, s u p p o r t e d b y w o r l d - c l a s s t e c h n o l o g i c a l
infrastructure to ensure fast transactions.
The time taken to process a transaction is in seconds and you can be
rest assured of the net amount getting credited to your current account on
the next working day.

Greater Profitability
Accepting payments in cash is costly. If you calculate the time spent by you
or your employee in accepting cash, counting the same, making
appropriate stacks, time and cost involved in visiting the nearest bank
branch, waiting time at the branch and the cost of depositing cash (some
banks charge for accepting cash), you will realise that paying a small
discount rate on card transactions is a much more effective way of saving
cost and time.

Reduced Risk
HDFC bank-Merchant Services has a dedicated team working round the
clock and strives to guard our merchant customers against the risk
posed by fraudsters. We have proactive risk management software that
runs checks on the cards swiped on our terminals. We inform our
merchant customers within minutes of a suspicious transaction being
done on our machines to take necessary actions.

Payment Reports

21
W ith HDFC bank Merchant Services, you get an option of taking
payment reports on a daily, weekly, fortnightly or monthly basis. This will
help you match your card transactions against the payment credits in your
current account with us.

Relationship Officers
A dedicated Relationship Officer is assigned to the merchant. This officer acts
as a one point contact for all your requirements concerning the
Merchant Services department and will also facilitate your other banking related
requirements.

Dedicated Helpdesk
We have an, in-house, dedicated, customer service team, which trouble
shoots in case you need any assistance on the machine operations, rolls,
charge backs, reports, etc

Payment Gateway
HDFC Bank Payment Gateway provides a single platform to support
multiple payment technologies. The solution supports Secure Sockets
Layer (SSL), Secure Electronic Transactions, Pseudo Card Numbers
(PCN), 3-D Secure Visa Authenticated Payment protocol and MasterCard Secure
Payment Application (SPA).
HDFC Bank Payment Gateway enables the merchants to stay abreast of
rapidly changing payment technology; it incorporates a hosted payment
page that provides a common interface with the merchant web site,
regardless of which secure payment protocol is used. HDFC Bank
Payment Gateway also provides secure browser-based access for real
time transaction monitoring and reports download.
Our Payment Gateway integrates risk-management and fraud-detection

22
software using a sophisticated, easy-to-manage rules-based system that
monitors merchant and cardholder activity.
P a ym e n t G a t e w a y i s a f l e x i b l e , s c a l a b l e s o l u t i o n d e s i g n e d t o
accommodate the rapidly evolving Internet secure payment environment for
businesses. It offers a user-friendly facility to businesses to sell their products in
a hassle-free manner to their target customers and ensure receipt of
payments upfront.
Payment Gateway integrates risk-management software.

Provides
management

an

integrated,

s ys t e m

th a t

flexible
o p e ra te s

rules-based
wi th

all

proactive

s e cu re

risk

p a ym e n t

protocols

Supports branding and CSS for merchants.

Supports online transactions, batch processed transactions as well as IVR
and kiosks.

Transaction data, reports and other relevant information is easily

accessible through browser enabled user interface for merchants

Supports multiple payment types and can route to various

authorisation systems and traditional card payment engines

Supports multiple platforms.

VBV and Securecode compliant.
Highly reliable Payment Gateway offering 99.99% uptime.
Customised MIS solutions for travel,, retail and service (e.g. telecom)

23
industries.

Easy to integrate and maintain..

24 Hour helpdesk support.

How an Internet transaction is initiated and processed through

Payment Gateway?
The customer fills his shopping cart on a merchant website and proceeds to
check out.

The transaction information is transmitted to the merchant server.

The web merchant forwards a digital order to the Payment Gateway server in
an encrypted format.

The Payment Gateway authenticates the merchant and provides payment

options and payment details screens directly on the customer's browser
over a secure 128-bit SSL+ connection.

The customer provides his credit card details, which is directly sent to
the Payment Gateway server when he clicks "Pay" .

The credit card details are then switched to the Operator / Bank for
authentication.

The Operator / Bank then transmits the message to the

cardholders' bank for payment authorisation.

The issuing bank authorises the payment, provided the card is v a l i d

24
a n d h a s t h e r e q u i s i t e c r e d i t l i m i t a n d t r a n s m i t s t h e confirmation
back to the Payment Gateway through the Operator / Bank

On receiving the authorisation, Payment Gateway forwards a digital

receipt to the merchant server.

The merchant provides a confirmation of the payment to the

customer's browser.

The entire process integrates seamlessly with the shop and buy application of
the web merchant.
The merchant may then ship the goods and capture the transaction on
the gateway server.

Flexible

Supports multiple merchants on a single platform.

Acceptance for most of the major credit and debit cards.

User interfaces for merchants are browser enabled.

Supports multiple platforms.

Fast
Time to. market - integrating merchants via simple universal payment
adapter (Merchant Plug-In).

Scalable to process a few thousand transactions to millions of transactions /

25
month on a real time basis..

Utilises Java architecture and a relational database either

Microsoft SQL or Oracle for scalability and portability.

Integration with existing applications and support for various shopping

cart applications are simpler and faster.
Smart

Provides an integrated, flexible rules-based risk-management system

that operates with all secure payment protocols.

Transactions are screened by up to three negative files - BINs; hot cards

reported lost or stolen; and warm cards that have exceeded usage or other
temporary parameters.

Supports multiple payment types and can route to various

authorisation systems and traditional card payment engines.

Provides

extensive

online

query

capabilities

that

support

evaluation of transaction activity.

Allow cardholders to create personal assurance messages which can later

be exchanged with their financial institutions during the purchase transaction

Supports CVV2 and CVC2 for fraud control .

Reliable

Supports online, batch and manually entered transactions.

Provides merchants with Internet access to transaction data,

reports, and other relevant information.

26

Provide both cardholders and financial institutions with the

knowledge that purchases have been securely authenticated.

Mai ntain

comple te

dig ital

histo ry

of

o rde rs,

incl udin g

confirmation numbers, payment and shipment details and relevant captured Web
pages.

Secured user interfaces for system management and operations.

State-of-the-art security technology and processes .

Comprehensive user guides and support information.

24x7 helpdesk support - Local.

Merchant Product Offerings

HDFC Bank Merchant Services is the national leader in electronic
payment solutions. We give a competitive edge to businesses and
financial institutions, by offering a complete portfolio of systems, services and
innovative products to meet the ever-changing market dynamics.

Card Acceptance:
On the EDC terminals provided by HDFC Bank, all cards issued under the
following brands can be accepted by your outlets

Visa (Credit)
MasterCard (Credit)
Visa Electron (Debit)

27

Maestro (Debit)
As part of our terminal sharing arrangement with American Express, you can
also accept American Express Cards on our terminals. However you
need to have a Merchant relationship with American Express directly and
communicate with American Express to have this activated on the HDFC
Bank Terminal.

Technology infrastructure:
HDFC Bank would install the state of the art latest generation EDC
terminals on which you can accept all signature-based cards. The entire
service is backed by superior technology infrastructure in terms of the
network, systems and processes.

Payment Options:
Payment can be made by credit to current account with the bank or
manager's cheque

Personalised service:
W e o ffe r p e r s o n a l i s e d s e r vi c e t o o u r Me r c h a n t s . O n e m e r ch a n t
relationship officer is designated for taking care of the relationship with our
merchants. This officer will be the one point contact in the bank for all
issues relating to your merchant account.
For more details, write in to us at hdfcbank.meservices@hdfcbank.com
and we will get back to you.

28

Working Capital Finance

At HDFC bank understanding a customer's requirement and fulfilling it with
innovative product solutions is a way of life. We understand that
businesses need working capital to run day to day operations and to
f u n d yo u r b u si n e s s e xp a n si o n . W e h a ve p r o d u c t s , wh i c h c a n b e
structured to suit your business loan requirements.
We are a bank with substantial appetite for recognised credits.We can
offer you working capital finance by way of cash credit or loans suitably
structured to your needs and your risk profile in consortium or as a sole
banker.

Marketing and Other Support

Card Support
Imagine a leading newspaper reserving sole space for you, running your
ad, and mailing it individually to each of your prospective customers.
Here's an innovative marketing idea that's sure to give maximum mileage to
yo u r pro d u ct o r se rvi ce . Ju st ca rr y yo u r o ffe r o n th e m on th l y
statements of India's high end Credit Cards of HDFC Bank.

Targeted Direct Mailers

You ge t a di re ct rea ch to yo u r spe cific ta rge t g roup and yo u ca n
communicate one on one with them. You have a captive audience who'll
read and re-read your message at leisure. And since the people you are
targeting are personally addressed, there's no wastage.

EMI Opportunities
Advertise your EMI offers to HDFC Bank credit card customers interested in

29
buying now and paying later in installments coupled with a fantastic
finance offer.

Catalogue based rewards Program.

You can also widen your reach and popularise your products by participating
in HDFC Bank's Rewards Program.
As of March 31, 2008, the Banks distribution network was at 761 Branches
and 1977 ATMs in 327 cities as against 684 branches and 1,605 ATMs in
320 cities as of March 31, 2007.
Against the regulatory approvals for new branches in hand, the Bank
expects to further expand the branch network by around 150 branches by
June 30, 2008. During the year, the Bank stepped up retail customer
acquisition with deposit accounts increasing from 6.2 million to 8.7 million
and total cards issued (debit and credit cards) increasing from 7 million to
9.2 million.
Whilst credit growth in the banking system slowed down to about 22% for the
year ended 2007-08, the
advances growing

by

Banks
38.6% and

net advances grew by 35.1% with retail

wholesale advances growing by 30%,

implying a higher market share in both segments. The transactional banking

business also registered healthy growth With

cash

management

volumes

increased by around 80% and trade services volumes by around 40% over the
previous year.

Portfolio quality as of March 31, 2008 remained healthy with gross nonperforming
assets at 1.3% and

net

non-performing

assets at 0.4% of total customer

assets. The Banks provisioning policies for specific

remained higher than regulatory requirements.

loan

loss

provisions

30

TECHONOLOGY USED IN HDFC BANK

In the era of globalization each and every sector faced the stiff competition
from their rivals. And world also converted into the flat from the globe. After the
policy of liberalization and RBI initiatives to take the step for the private sector
banks, more and more changes are taking the part into it. And there are create
competition between the private sector banks and public sector bank.
Private sector banks are today used the latest technology for the different
transaction of day to day

banking

life.

As

we

know that Information

Technology plays the vital role in the each and every industries and gives the
optimum return from the limited resources.

Banks are service industries and today

IT gives the innovative Technology

application to Banking industries. HDFC BANK is the leader in the industries

and today IT and HDFC BANK together combined they reached the sky. New
technology changed the mind of the
concept

from

the

customers

and

changed

the queue

history banking transaction. Today there are different

channels are available for the banking transactions.

We can see that the how technology gives the best results in the below diagram.
There are drastically changes seen in the use of Internet banking, in a year 2001
(2%) and in the year 2008 ( 25%).
These type of technology gives the freedom to retail customers.

Centralized Processing Units

Electronic
Processing

Straight

Derived Economies of Scale

Through

Reduced Transaction Cost

31
Data Warehousing , CRM

Improve cost efficiency, Cross

sell
Provide
new
or
superior
products

Innovative Technology Application

HDFC BANK is the very consistent player in the New private sector banks.

New

private sector banks to withstand the competition from public sector banks came up
with innovative products and superior service.

2001

2005

32

(%customer initiated Transaction by Channel)

HDFC BANK PRODUCT AND CUSTOMER SEGMENTS

PERSONAL BANKING
1. Loan Product
2. Deposit Product
3. Investment & Insurance
4. Cards
5. Payment Services
6. Access To Bank
7. Forex Services

Loan Product

Auto Loan

Loan Against Security

33

Loan Against Property

Personal loan

Credit card

2-wheeler loan

Commercial vehicles finance

Home loans

Retail business banking

Tractor loan

Working Capital Finance

Construction Equipment Finance

Health Care Finance

Education Loan

Gold Loan

HOUSING LOAN - APNA GHAR SCHEME

Eligibility: Any person / group of persons, Salaried / Self - Employed /business
class /retired jointly with employed spouse or son having regular income and
capacity to repay installments of proposed housing loan.
Age: Minimum age - 21 years; Maximum age - 65 years (last installment should
mature at the age of 65 years)
Income:

34

Salaried Individuals - Any individual who is in permanent service in

Government/ reputed Companies having a minimum salary of Rs. 8,500/(Salary means Gross salary less statutory deductions like PF, income tax
& ESI);

Professionals- Doctors, Engineers, Dentists, Architects, CAs, Cost

Accountants, CSs, MBAs and other professionals having minimum annual
average income of last three years - Rs. 1.00 lac;

Self-Employed / Business class Individuals & and other individuals

not

classified above- Minimum annual average income of last three

years of Rs. 1.00 lac.

Purpose:
Purchase of ready built house / flat, land and construction thereon;
Repairs and Renovation;
Shifting/ take over of loan. (Take over of loans availed from other financial
Institutions).
Quantum of Loan:
For Repairs and Renovation Maximum Rs.10.00 lacs;
For Purchase of ready built house / flat, land and construction thereon Maximum Rs.100.00 lacs.
Switch Over Cost: Switching from the fixed rate to floating rate and vice versa
will attract 1% of the outstanding amount.

Reset Clause: In case of Fixed Interest Rate, reset clause will be applied after
every 3 years.

35
Margin: 15% in case of purchase of house, flat, land and construction and
repairs and renovation.
Assessment of Loan Amount:

Salaried Individuals: Up to 36 times of monthly salary or cost of

project (less 15% margin) whichever is less. Income of spouse or blood
relatives can be clubbed if they are made co-borrower. As a matter of
credit prudence the total deductions including installment of proposed loan
should not exceed 50% of the salary (gross salary less P.F.& income-tax).
The EMI should not exceed 30% of gross monthly salary. However, if we
are otherwise satisfied about the credit worthiness and repaying capacity
of the borrower, the norms for deductions may be relaxed.

Professionals: 3 times of the average annual income of last three

years or the cost of the project less 15% margin whichever is
less. Income of spouse or blood relatives can be clubbed if they are made
co-borrower. In case the applicant is proprietor of any firm, then
depreciation charged in the firm's balance sheet can be added back in the
income.

Self employed, Businessmen & and other individuals not classified

above: 3 times of the average annual income of last three years or the
cost of the project less 15% margin whichever is less. Income of spouse
and sons can be clubbed if they are made co-borrower. Income of other
blood relatives can be clubbed only if they are joint owners of property and
made co-borrower. In case the applicant is proprietor of some firm, then
depreciation charged in the firm's balance sheet can be added back in the
income.

Repayment Period: Maximum 20 years in case of purchase of house inclusive

of moratorium period; Maximum 9 years in case of repairs and renovations.
Processing Charges:

36
Loans up to Rs 2.00 lacs - 0.50% of sanctioned loan amount
Loans above Rs 2.00 lacs - 1.00% of sanctioned loan amount.
(Valuation, Advocate Fee, Documentation, stamps, inspection charges etc.) to be
recovered from the borrower on actual basis, before release of facility.
Foreclosure Charges: 2% of the prepaid amount. Out of pocket expenses
Sanction Procedure: The decision to sanction the loan is based on scoring
model. The loan can be sanctioned if an applicant scores marks 50 or above. If
the score is 45 to 49, the loan can be sanctioned with additional interest of
0.50%, and if it is between 40 to 44, the loan can be sanctioned at additional
interest of 1%.
Similarly, loans to salaried person can be allowed upto 50 and 60 months of
salary at an additional interest of 0.50% and 1% respectively. Loans to persons
other than salaried class can be allowed upto 4 to 5 times of average annual
income at additional interest of 0.50% or 1% respectively.

37

PERSONAL LOAN SCHEME

Eligibility: Salaried Individual with permanent service of minimum three years in
Government, PSU/MNC, reputed Public or Private Company. Professionals like
Doctors, Chartered Accountants, Company Secretaries, MBAs, Engineers etc
Self Employed other than Professionals, businessmen etc. Other individuals not
classified like partners or directors having cash credit accounts of their firms or
companies
Income:

Salaried Individuals -Minimum salary of Rs. 7500/- p.m. (Salary means

Gross salary less statutory deductions like PF, income tax & ESI);

Self Employed/Professional / Businessmen/ other Individuals not

classified - Minimum average Annual Income Rs. 1.00 lac for last three
years as per Income Tax Return

Purpose: To meet personal expenses.

Age: Minimum 24 years; Maximum 65 years inclusive of loan period.
Loan Amount:

In case of Salaried Individuals- Minimum Rs 25,000/-, Maximum Rs.

10.00 lacs;

Self-employed/ Professionals/Businessmen/Other individuals not

classified -Minimum Rs 25,000/-, Maximum Rs. 15.00 lacs.

Repayment Period: 12 to 48 months.

Interest Rate: Declared on time-to-time basis.
Service Charge: 2% of Loan amount as up-front fee.

38
Prepayment Charges: 2% of prepaid amount.
Disbursement: In the SB/CD account of borrower or as per his instruction.
Assessment of Loan Amount:
Salaried Individuals - 5 to 12 months salary, subject to the condition that total
deductions including installment of proposed loan should not exceed 50% of the
net salary (i.e. gross salary less P.F.& income tax). The EMI should not exceed
20%

of

gross

monthly

income. Professional/

Self

employed

persons/

Businessmen/other individuals not classified- Up to 40% to 150 % of average

annual income of last three years based upon repayment period as per chart
given under:
Sanction Procedure:
The decision to sanction the loan is based on scoring model. The loan can be
sanctioned if an applicant scores marks 50 or above.

39

Mortgage Loan/ Overdraft Scheme for Individuals

Eligibility:
Individuals (against self owned property/ properties or property / properties
owned by his spouse, children) HUF Concern (against self owned property
/properties or property / properties owned by karta, major coparceners, his /her
/their spouse, children)
Amount:
Maximum Loan upto Rs. 100 lacs. Additional advance against same property
can be allowed to same or other party if there is sufficient residual value i.e.
remaining value after advance against mortgage loan is sufficient to take care of
other advance. Property where housing loan is already availed can also be
considered for loan under this scheme if residual value is sufficient and eligibility
criterion is complied with.
Purpose: Personal needs.
Nature of advance: By way of Loan or Over Draft.
Security:
Equitable Mortgage of the property for which the advance is sanctioned. It
includes: a) Residential/commercial immovable property; b) Free hold land
(vacant plot); c) Leasehold land (vacant plot) subject to permission of lessor (viz.
respective Municipal Corporation, Development Authority etc.) is obtained

d)

Leased/rented property provided owner & lessee/tenant agree for assignment of

lease income/rent in favour of Bank for direct receipt of the same in the loan/OD
a/c.
Guarantee:

40

Personal guarantee / guarantee of owner (s) of the property (in case property is
owned & occupied by person other than the borrower / applicant.). In case of
HUF personal guarantee of Karta, major coparceners.
Interest: Declared on time-to-time basis.
Penal Interest: 4 % above the normal rate applicable on the defaulted amount.
Foreclosure Charges: 2 % of the prepaid amount
Amount of advance:
Four times of the average of gross yearly income as declared in the Income Tax
returns of the immediately completed past two financial years or 70 % of the
property value, assessed by the Banks approved valuer or assessed by the
Branch Manager as per the Spot Visit Report whichever is lower.
(In case of salaried / self employed / professionals / businessmen, the income
of spouse and depreciation can be clubbed for arriving at the eligible
loan/overdraft amount. In such cases the spouse should become co-borrower or
his / her personal guarantee should be obtained.)
Repayment
Loan Maximum 180 equated monthly installments.
Over Draft Repayable on demand subject to yearly review. Interest is to be
recovered on as and when debited basis. Annual review to be based on income
tax, audited balance sheet (wherever applicable) business statistics, conduct of
account, earnings etc. The utilization of the limit should be at least 80%,
otherwise commitment charges @ 2% on the unutilized portion shall be levied. In

41
case of Loan/overdraft facility the annual repayment obligation is subject to
following conditions:
In case of professional / self-employed personals / Businessmen / entrepreneurs
etc the annual repayment obligation (including all other repayment commitments)
should note exceed 75% of the Gross yearly Income.
In case of loan to salaried class, the total future yearly repayment obligation
(including all other repayment commitments) of the borrower should not exceed
60% of the Gross Yearly salary of the borrower. Estimated interest amount for
full year on sanctioned OD amount will be considered as annual repayment
obligation in case of overdraft facility.
Procession charges:
(a) For Loan: - @. 0.50 % of loan sanctioned (one time)
(b) For Overdraft: - @ 0.50 %p.a. on overdraft sanctioned limit and @ 0.50 % for
the subsequent renewal every year for each calendar year basis.
Out of pocket expenses (Valuation, Advocate Fee, Documentation, stamps,
inspection charges etc.) to be recovered from the borrower on actual basis,
before release of facility.
Sanction Procedure:
The decision to sanction the loan is based on scoring model. The loan can be
sanctioned if an applicant scores marks 50 or above.

42

CAR LOAN SCHEME

Eligibility:
Any salaried individual / businessman, professional and self-employed and other
individual not classified with a minimum gross Salary / Income of Rs. 1.00 lac per
annum.
Purpose:
Purchase of brand new passenger car. The car will be hypothecated to the Bank
as security.
Age: Minimum 21 years; Maximum 65 years inclusive of loan period.
Loan amount: Minimum loan amount is Rs. 1.00 lac and Maximum Rs. 25.00
lacs.
Repayment period: 12 to 60 months based on surplus available for repayment.
Interest Rate. Declared on time-to-time basis.

Margin:
10% of cost of Vehicle up to the loan of Rs. 10.00 lac & 20% of cost of Vehicle for
loan of more than Rs. 10.00 lac.
Processing Fee: 0.50% of Loan amount.
Prepayment Charges: 1% of prepaid amount.
Assessment of Loan amount: The total deductions including installment of
proposed loan should not exceed 50% of the salary (gross salary less P.F.&
income tax). The EMI should not exceed 20% of gross monthly salary.

43
Sanction Procedure:
The decision to sanction the loan is based on scoring model. The loan can be
sanctioned if an applicant scores marks 50 or above.

Deposit Product

Saving a/c

Current a/c

Fixed deposit

Demat a/c

Safe Deposit Lockers

Investment & Insurance

Mutual Fund

Bonds

Knowledge Centre

Insurance

General and Health Insurance

Equity and Derivatives

Mudra Gold Bar

Cards

Credit Card

Debit Card

Prepaid Card

Payment Services

NetSafe

Merchant

44

Prepaid Refill

Billpay

Visa Billpay

InstaPay

DirectPay

VisaMoney Transfer

eMonies Electronic Funds Transfer

Online Payment of Direct Tax

Access To Bank

NetBanking

OneView

InstaAlert

MobileBanking

ATM

Phone Banking

Email Statements

Branch Network

Forex Services

Product & Services

Trade Services

Forex service Branch Locater

RBI Guidelines

45

WHOLESALE BANKING
Corporate

Funded Services

Non Funded Services

Value Added Services

Internet Banking

Small and Medium Enterprises

Funded Services

Non Funded Services

Specialized Services

Value added services

Internet Banking

Financial Institutions and Trusts

BANKS

Clearing Sub-Membership

RTGS submembership

Fund Transfer

ATM Tie-ups

Corporate Salary a/c

Tax Collection

46

Financial Institutions

Mutual Funds
An investment vehicle that pools savings of various investors with a common
financial goal.
Advantages of investing in a mutual fund
Professional Management of Funds
Well regulated industry
Diversification
Easy Liquidity
Low Cost
Transparency
Higher return potential compared to FDs

Myths surrounding Mutual Funds

It is unsafe
It only deals with Equity Markets
My money is locked in
I do not have a tangible investment

Mutual Funds - The Basics

47
Sponsor
Person who establishes the mutual fund - role akin to that of a promoter of a
company.
Eligibility criteria
Sound Track record
Holds at least 40% of the net worth of the AMC
Appoint Trustees
Appoint AMC
Trustees
First level regulators for mutual fund schemes
Hold the property of the MF in trust for the benefit of the unit-holders
Prior approval of SEBI needed for appointment
2/3rd to be independent
Ensure that AMC is managing schemes in accordance with Regulations
and scheme mandate
General and Specific Due Diligence
The Asset Management Company (AMC)
Is the Investment Manager
Employs people in marketing, fund management, operations and
compliance
50% independent directors
Can undertake only permitted activities
Reporting to Trustees and SEBI

48

Other Fund Constituents

Bankers
Registrar
Custodians
Distributors
Fund Accountant

Types of Mutual Funds

By Structure
Open-ended v/s close-ended
By Investment Objective

Equity Funds
Debt Funds
Balanced Funds
Liquid Funds
Index Funds
Variants in overseas markets - real estate funds, gold funds, derivative
funds, etc.

SYSTEMATIC INVESTMENT PLAN

Creates the investing habit
Participation in all market movements
Avoids Timing the market

49
Avoids Greed and Fear

50

General Insurance - Mediclaim

Group Mediclaim
The Group Mediclaim is a cover under which all Bank Account holders can be
covered and the main benefit is that the premium here is much less than under
Individual Mediclaim Scheme, whereas the benefits are more.
Premium: Paid in advance at rates mutually agreed.
Commencement of Cover: The cover commences from date of credit of
premium in United Indias Account.
Salient Features:
Raj Arogya Nidhi
Cover is granted to a family on floater basis, consisting of account holder, spouse
and two dependant children under Plan A. If parents are covered, Plan B is
opted.
The maximum age limit for entering the scheme is 65 years. After entering the
scheme, continuous renewals upto 80 years can be done. Minimum age is 3
months.
The amount of cover for floater family can be from Rs. 50,000/- to Rs. 5 lacs
maximum.
The account holder has to fill up and sign the proposal form containing
authorization to debit the account, and declaration of good health. The form is to
be obtained in 3 copies, along with photographs.

51
Proof of Insurance: When the proposal form reaches the Insurance Company, a
policy is issued by United India Insurance Company Limited and Photo ID card
issued by TPA (Third Party Administrator)
Benefits available under the scheme: The account holder and floater family
who have enrolled under the scheme are eligible for the following benefits:
Subject to maximum of sum insured, hospitalization expenses in the event of
sudden illness, accident, surgery required in respect of disease are covered.
Ambulance expenses upto Rs. 1,000 will be reimbursed during hospitalization
within overall sum assured per policy year.
In case children below 12 years are hospitalized, out of pocket expenses upto
Rs. 1,000/- is reimbursed to parents taking care of the children with in the overall
sum assured per policy year.
Cost of health check up 1% of sum assured is reimbursed after completion of
four continuous claim free policy years. The four continuous claim free policy
years are counted if the policy was obtained from any other Insurance Company
in the earlier years. IMPORTANT: The health check up provision is applicable
only in respect of continuous insurance without break.
Pre existing diseases would be covered after three continuous claim free policy
years which includes policies taken from any other insurance company.
Funeral expenses for maximum amount of Rs. 1,000/- in the case of insured
donating eye(s) is reimbursed over and above the sum assured, subject to
original illness/ accident claim admitted under the policy.
Maternity and Baby care expenses are reimbursed upto 5% of the sum assured.
Waiting Period is 9 months and Baby Care expenses payable to 90 days from the
date of birth.

52
Expenses on treatment taken in hospitals in Nepal and Bhutan are also covered
in Indian currency.
Treatment of NRIs at hospitals in India is covered upto sum assured in Indian
currency.
Cashless hospitalization facility through TPAs is available.
Add on Facility
Personal Accident Insurance Death Benefit (optional) for the family is available
on payment of additional premium. The premium mentioned under the Personal
Accident Insurance Death Benefit should be obtained over and above the
premium as per Plan A. The Personal Accident Insurance Death Benefit is
optional and additional premium is collected only for those who opt for the
scheme.
The Personal Accident (death cover) available for members who are covered
under the scheme is as follows:
Account Holder

Spouse of Account Holder :

100% of sum insured

50% of sum insured

Dependent Children of age

Above 5 yrs and upto 21 yrs

20% of sum insured

Dependent children of
upto 5 yrs of age
Exclusions
The policy does not cover:

10% of sum insured

53
Pre-existing diseases (however, it is covered after four continuous claim free
policy years which includes policies taken from any other insurance company)
Hospitalization expenses incurred in the first 30 days of commencement of cover
except in cases of injury due to accident
Domiciliary hospitalization
Other standard exclusions applicable to Mediclaim policies will also apply.
Claim Procedure
Cashless treatment can be availed at the network hospitals by showing thee
photo ID cards issued by TPA and in case for any reason cashless service could
not be availed, the customer can meet the hospital bills and claim reimbursement
from TPA. If the insured has not opted for TPA, the claim forms along with bills
should be sent to the nodal office of United India Insurance Company Ltd.
Income Tax Benefit
Income tax benefit as per Section 80D of Income Tax is available to account
holders who enroll under the scheme.
Claims:
The claims will be settled by Company

54
Stock Brokers
Insurance Companies
Commodities Business
Trusts

BUSINESS MIX

Total Deposits
Revenue

Retail

Gross Advances

Wholesale

Net

55

HDFC Bank is a consistent player in the private sector bank and

have a well balanced product and business mix in the Indian as
well as overseas markets.

Customer segments (retail & wholesale) account for 84% of Net

revenues ( FY 2008)

Higher retail revenues partly offset by higher operating and credit

costs.

Equally well positioned to grow both segments.

.
NRI SERVICES
Accounts & Deposits

Rupee Saving a/c

Rupee Current a/c

Rupee Fixed Deposits

Foreign Currency Deposits

Accounts for Returning Indians

Remittances

North America

UK

Europe

South East Asia

Middle East

56

Africa

Others such as Quick remit

India Link

Investment & Insurances

Mutual Funds

Insurance

Private Banking

Portfolio investment Scheme

Loans

Home Loans

Loans Against Securities

Loans Against Deposits

Gold Credit Card

Payment Services

NetSafe

BillPay

InstaPay

DirectPay

Visa Money

57

Access To Bank

NetBanking

OneView

InstaAlert

ATM

PhoneBanking

Email Statements

Branch Network

BUSINESS STRATEGY
HDFC BANK mission is to be "A World Class Indian Bank", benchmarking
themselves against
product

international standards and best practices in terms of

offerings, technology, service levels, risk management and audit &

compliance. The objective is to build sound customer franchises across distinct

businesses so as to be a preferred provider of banking services for target retail
and wholesale customer

segments, and to achieve a healthy

growth in

profitability, consistent with the Bank's risk appetite. Bank is committed to do

this while

ensuring the highest levels of

ethical

standards,

professional

integrity, corporate governance and regulatory compliance. Continue to develop

new product and technology is the main business strategy of the bank. Maintain
good relation with the customers is the main and prime objective of the bank.

HDFC BANK business strategy emphasizes the following:

Increase market share in Indias expanding banking

and financial

services industry by following a disciplined growth strategy focusing on

quality and not on quantity and delivering high quality customer service.

58

Leverage our technology platform and open scaleable systems to deliver

more products to more customers and to control operating costs.

Maintain current high standards for asset quality through disciplined

credit risk management.

Develop innovative products and services that attract the targeted

customers and address inefficiencies in the Indian financial sector.

Continue to develop products and services that reduce banks cost of

funds.

Focus on high earnings growth with low volatility.

INSIDE HDFC BANK

FIVE S , PART OF KAIZEN
WORK PLACE TRANSFORMATION
Focus on effective work place organization
Believe in Small changes lead to large improvement

Every successful organization have their own strategy to win the race in the
competitive market.

They use some technique and methodology for smooth

running of business.

HDFC BANK also aquired the Japanese technique for

smooth running of work and effective work place organization.

Five S Part of Kaizen is the technique which is used in the bank for easy and
systematic work place and eliminating unnecessary things from the work place.

59

BENEFIT OF FIVE S

It can be started immediately.

Every one has to participate.

Five S is an entirely people driven initiatives.

Brings in concept of ownership.

All wastage are made visible.

FIVE S Means:S-1
S-2
S-3
S-4
S-5

SORT
SYSTEMATIZE
SPIC-N-SPAN
STANDARDIZE
SUSTAIN

SEIRI
SEITON
SEIRO
SEIKETSU
SHITSUKE

SORT:It focus on eliminating unnecessary items from the work place. It is excellent
way to free up valuable floor space. It segregate items as per require and
wanted.

Frequently
Required

Less Frequently
Required
Remove
everything from
workplace

Wanted but not

Required

Junk

60

SYSTEMATIZE:Systematize is focus on efficient and effective Storage method. That means it

identify, organize and arrange retrieval. It largely focus on good labeling and
identification practices.
Objective :- A place for everything and everything in its place.

SPIC- n - SPAN:Spic-n-Span focuses on regular clearing and self inspection. It brings in the
sense of ownership.

STANDERDIZE:It focus on simplification and standardization. It involve standard rules and

policies. It establish checklist to facilitates autonomous maintenance of
workplace. It assign responsibility for doing various jobs and decide on Five S
frequency.

SUSTAIN:It focuses on defining a new status and standard of

organized work place.

Sustain means regular training to maintain standards developed under S-4. It

brings in self- discipline and commitment towards workplace organization.

LABELLING ON FILE
FILE NUMBER
SUBJECT

61

FROM DATE
TO DATE
OWNER

BOX LABEL
For Example 1 / 3 / A / 6

1 Work Station (1)

3 Drawer (3)
A - Shelf (A)
6 File Number ( 6)

COLOUR CODING OF FILES

DEPARTMENT
Welcome Desk

Personal Banker
Teller
Relationship Manager
Branch Manager

62
Demat
Others

In the HDFC BANK each department has their different color coding apply on
the different file. Due to this everyone aware about their particular color file
which is coding on it and they save their valuable time. It is a part of Kaizen and
also included in the system of the Five S. Logic behind it that , the color coding
are always differentiate the things from the similar one.

BUSINESS PROMOTION
As the HDFC POS business is at a very initial stage and growing, the marketing
and business promotion activities will be an ongoing activity for the life of the
product. We have divided the year into two parts. It is known from the market
practice that the season from October to March (six months) is the peak season
for shopping, where as people like to keep themselves indoors during April to
September.
But as the competition is very stiff in the market, it is the merchant who makes
the decision on which machine the card is to be swiped. In most of the cases its
the Sales representative or the person at cash counter who is the correct
person to cultivate relations with to maximize swipes on HDFC machines.
As explained earlier also, When HDFC becomes Issuer and acquirer both then it
is the best deal in terms of earnings because we do not have to share anything
with other banks or MasterCard or Visa International. So we target two different
kind of schemes for which a separate approval from higher authorities will be
taken from time to time after analysis of the situation.

HUMAN RESOURCE

63
The Banks staffing needs continued to increase during the year particularly
in the retail banking businesses in line with the business growth. Total number
of employees increased from

14878

as of March31,2006 to 21477 as of

March 31, 2007. The Bank continues to focus on training its employees on a
continuing basis, both on the job and through training programs conducted by
internal and external faculty.

The Bank has consistently believed that broader employee ownership of its
shares has a positive impact on its performance and employee motivation. The
Banks employee stock option scheme so far covers around 9000 employees.

RUPEE EARNED- RUPEE SPENT

It is more important for every organization to know about from where and where
to spent money. And balanced between these two things rupee earned and
rupee spent are required for smooth running of business and financial
soundness.

This type of watch can control and eliminate the unnecessary

spending of business. In this diagram it include both things from where Bank
earned Rupee and where to spent.

64

HDFC BANK earned from the Interest from Advances 51.14 % ,Interest from
Investment 27.12 %, bank earned commission exchange and brokerage of
15.25 %. These are the major earning sources of the bank. Bank also earned
from the Forex and Derivatives and some other Interest Income.
Bank spent 39.75 % on Interest Expense, 30.27 % on Operating Expense and
14.58 % on Provision. Bank also spent Dividend and Tax on dividend, Loss on
Investment , Tax. As we discuss above that balancing is must between these two
for every organization especially in the era of globalization where there are stiff
competition among various market players.

RECENT DEVELOPMENT

65

The Reserve Bank of India has approved the scheme of amalgamation of

Centurion Bank of Punjab Ltd. with HDFC Bank Ltd. with effect from May 23,
2008.
All the branches of Centurion Bank of Punjab will function as branches of
HDFC Bank with effect from May 23, 2008. With RBIs approval, all requisite
statutory and regulatory approvals for the merger have been obtained.

The combined entity would have a nationwide network of 1167 branches; a

strong deposit base of around Rs.1,22,000 crores and net advances of around
Rs.89,000 crores. The balance sheet size of the combined entity would be over
Rs.1,63,000 crores.

Merger with Centurion Bank of Punjab Limited

66
On March 27, 2008, the shareholders of the Bank accorded their consent to a
scheme of amalgamation of Centurion Bank of Punjab Limited with HDFC Bank
Limited.

The shareholders of the Bank approved the issuance of one equity

share of Rs.10/- each of HDFC Bank Limited for every 29 equity shares of
Re. 1/- each held in Centurion Bank of Punjab Limited.

This is subject to

receipt of approvals from the Reserve Bank of India, stock

Other

exchanges and

requisite statutory and regulatory authorities. The shareholders also

accorded their consent to issue equity shares and/or warrants convertible into
equity shares at the rate of Rs.1,530.13 each to HDFC Limited and/or other
promoter group companies on preferential basis, subject
approvals in this regard.
approved an increase

to final regulatory

The Shareholders of the Bank have

also

in the authorized capital from Rs.450 crores to

Rs.550 crores.

Promoted in 1995 by Housing Development

Finance

Corporation (HDFC),

India's leading housing finance company, HDFC Bank is one of India's premier
banks providing a wide range of financial products and services to its over 11
million customers across hundreds of Indian cities using multiple distribution
channels including a pan-India network of branches, ATMs, phone banking, net
banking and mobile banking. Within a relatively short span of time, the bank has
emerged as a leading player in retail banking, wholesale banking, and treasury
operations, its three principal

business segments. The bank's competitive

strength clearly lies in the use of technology and the ability to deliver world-class
service with rapid response time.

67

Over the last 13 years, the bank has successfully gained market share in its
target customer franchises while maintaining healthy profitability and asset
quality.

As on March 31, 2008, the Bank had a network of 761 branches and 1,977 ATMs
in 327 cities. For the year ended March 31, 2008, the Bank reported a net
profit of INR 15.90 billion (Rs.1590.2crore),up 39.3%, over the corresponding
year ended
As of

March 31, 2007.

March 31, 2008 total deposits were INR 1007.69 billion,(Rs.100,769

crore) up 47.5% over the corresponding year ended March 31, 2007. Total
balance sheet size too grew by 46.0% to INR 1,331.77 billion

(133177 crore).

Leading Indian and international Publications have recognized the bank for
its performance and quality.

Centurion Bank of Punjab is one of the leading new generation private sector
banks in India. The bank serves individual consumers, small

and

medium

businesses and large corporations with a full range of financial products and
services for investing, lending and advice on financial planning. The bank offers
its customers an array of wealth management products such as mutual funds,
life and general insurance and has established a leadership 'position'. The
bank is also a strong player in foreign exchange services, personal loans,
mortgages and agricultural loans.

68

Additionally the bank offers a full suite of NRI banking products to Overseas
Indians. On 29th August 2007, Centurion Bank of Punjab merged with Lord
Krishna Bank (LKB), post obtaining all requisite statutory
approvals.

This merger has

and

regulatory

further strengthened the geographical reach of

the Bank in major towns and cities across the country, especially in the State of
Kerala, in addition to its existing dominance in the northern part of the
country.
Centurion Bank of Punjab now operates on a strong nationwide franchise of
404 branches and 452 ATMs in 190 locations across the country, supported by
employee base of over 7,500 employees.In addition to being listed on the
major Indian stock exchanges, the
Luxembourg

Banks

shares are also listed on the

Stock Exchange.

ACHIEVEMENT IN 2007
Business
Monitor
survey

TodayGroup

Financial
ExpressErnst & Young Award

One of India's "Most Innovative Companies"

Best Bank Award in the Private Sector category

Global
HR 'Employer Brand of the Year 2007 -2008' Award - First
Excellence Awards - Runner up, & many more
Asia Pacific HRM
Congress:
Business Today
Dun & Bradstreet
American
Express

'Best Bank' Award

69
Corporate Best Bank
'Corporate Best Bank' Award
Award 2007

The Bombay Stock

Exchange
and
Nasscom
'Best Corporate Social Responsibility Practice' Award
Foundation's
Business for Social
Responsibility
Awards 2007
Outlook Money
NDTV Profit

& Best Bank Award in the Private sector category.

The Asian Banker Best Retail Bank in India

Excellence in Retail
Financial
Services
Awards
Asian Banker

HDFC BANK Managing Director Aditya Puri wins the

Leadership Achievement Award for India

70

SWOT ANALYSIS
STRENGTH

Right strategy for the right products.

Superior customer service vs. competitors.

Great Brand Image

Products have required accreditations.

High degree of customer satisfaction.

Good place to work

Lower response time with efficient and effective service.

Dedicated workforce aiming at making a long-term career in

the field.

WEAKNESSES

Some gaps in range for certain sectors.

Customer service staff need training.

Processes and systems, etc

71

Management covers insufficient.

Sectoral growth is constrained by low

and competition for staff

unemployment levels

Opportunities

Profit margins will be good.

Could extend to overseas broadly.

New specialist applications.

Could seek better customer deals.

Fast-track career development opportunities on an industry-wide basis.

An applied research centre to create opportunities for developing

techniques to provide added-value services.

Threats

Legislation could impact.

Great risk involved

Very high competition prevailing in the industry.

Vulnerable to reactive attack by major competitors

Lack of infrastructure in rural areas could constrain investment.

High volume/low cost market is intensely competitive.

COMPETITIVE SWOT ANALYSIS WITH ICICI BANK

72

STRENGTHS
S O Strategies
Strength: Large Capital base.
Opportunity: Market Expansion.
Strategy: Deep Penetration into Rural Market.

WEAKNESSES
W O Strategies
Weakness: Workforce Responsiveness.
Opportunity: Outsourcing of Non Core Business.
Strategy: Outsource Customer Care & other E-Helps.
S T Strategies

Strength: Low operating costs

Threat: Increased Competition from others Pvt. Banks.
Strategy: Steps to Ensure Loyalty by old Customers.
W T Strategies
Weakness: Not Equal to International Standards.
Threat: Entry of many Foreign Banks.
Strategy: Consider additional benefits

Detailed Analysis:

73

i.

Strength - Opportunity Analysis.

Strength:
It is well know that ICICI Bank has the largest Authorised Capital Base in the
Banking System in India i.e. having a total capacity to raise Rs.
19,000,000,000 (Non Premium Value).

Opportunity:
Seeing the present financial & economic development of Indian Economy
and also the

tremendous growth of the

the acquisition spree followed by

Indian Companies including

them,it clearly states the expanding

market for finance requirements and also the growth in surplus disposal
income of Indian citizens has given a huge rise in savings deposits from
the above point it is clear that there is a huge market expansion possible in
banking sector in India.

Strategy:
From the analysis of Strength & Opportunity the simple and straight
possible strategy for ICICI Bank could be - to penetrate into the rural sector
of India for expanding its market share as well as leading all other Pvt.
Banks from a great gap.

ii.

Strength - Threat Analysis.

Strength:

74
ICICI Bank is not only known for large capital but also for having a low
operations cost though having huge number of

branches

and services

provided.

Threat:
After showing a significant growth overall, India is able to attract many
international financial & banking institutes, which are known for their state of
art working and keeping low operation costs.

Strategy:
To ensure that ICICI Bank keeps going on with low operation cost & have
continuous business it should simply promote itself well & provide quality
service so as to ensure customer loyalty, therefore guaranteeing continuous
business.

iii.

Weakness - Opportunity Analysis.

Weakness:
It is well known that workforce responsiveness in banking sector is Very low
in Indian banking sector, though ICICI Bank has better responsible staff but
it still lacks behind its counterparts like HSBC, HDFC BANK, CITI BANK,
YES BANK etc.

Opportunity:
In the present world, India is preferred one of the best places for out
sourcing of business process works and many

more.

75

Strategy:
As international companies are reaping huge benefits after out-sourcing
there customer care & BPOs, this same strategy should be implemented by
ICICI Bank so as to have

proper

customer service without hindering

customer expectations.

iv.

Weakness - Threat Analysis.

Weakness:
Though having a international presence, ICICI Bank has not been able to
keep up the international standards in providing customer service as well as
banking works.

Threat:
In recent times, India has witnessed entry of many international banks like
CITI Bank, YES Bank etc which posses an external entrant threat to ICICI
Bank as this Banks are known for their art of working and maintain high
standards of customer

Strategy:

service.

76
After having new entrants threat, ICICI Bank should come up with More
additional benefits to its customer or may be even reduce some fees for
any additional works of customers.

PLASTIC MONEY

I give the project on Plastic Money to bank. The objective behind this project is
to increase the rich customers list in a bank. Plastic Money title itself says the
use of Credit Card and Debit Card in day to day transaction of the business. I
prepared the presentation on it and submitted to bank and Bank already
started work on this project.
Idea behind this project is to sale the bulk product. Target customer Of this
project are two parties one is Wholesaler and second is Retailer. Due to
this idea bank also sell their swipe machine to wholesaler and create brand
image in the market.

77
The idea behind this, bank give the credit card swipe machine to wholesalers
and retailers use the credit card of the bank. Bank gives the 50 days credit to
their credit card holders. So here retailers can get benefit of long credit period
and on the other side wholesalers can get the benefit of same day payment. As
a result bank got the wide list of customers of wholesalers and retailers.

78

Idea behind it, to convenience both the parties and create the group transaction
between them so bank can got the maximum benefit from it. Each wholesaler
has more than 15 to 20 retailers, so by this way bank sell the bulk products.

79

This power point slide shows the how idea works behind this project. Meet the
wholesaler first and get the details about their retailers and convince both parties
and shows the benefit of using this type of transaction by plastic money.

80

Bank always find those customers which are more involve in the banking
transaction. These type of group transaction between
retailers maintain the well account in a bank.

the wholesalers and

81

82

MASTER CARD AND VISA SETTLEMENT

It is the acquiring banks responsibility to re-imburse the merchants and claim
the same from Master card or Visa as the case may be. Both the organisations
have different rules and procedures of claiming funds by the acquiring banks. We
need to understand the rules and procedures of both the organisations
separately. We need to understand the system of transmitting outgoing files,
system of receiving incoming files and clearing procedures and time frames.

MASTER CARD
MasterCard offers the means for an acquirer bank and an issuer bank involved
in a transaction to clear and settle the transaction. The issuer is the institution
that issues cards to cardholders. The acquirer is an institution that has
agreements with merchants to process payments account transactions
and reimburse the merchants for those transactions. The acquirer enters those
transactions into clearing (through Master Card), thus settling with the issuer
to receive funds that it needs to reimburse to merchants. The acquirer bank
and Master Card must perform a series of steps to accomplish clearing and
settlement.
a) Clearing : Clearing is the process of sending transactions from the
acquirer to the issuer for posting to the cardholder account. Within INET, the
sending of data is determined by the issuer ICA number. Currently, an acquirer
groups its batches by issuing ICA number. When MasterCard receives
the batches (whether through the Banknet telecommunications network,
MasterCard file
express, MasterCard mainframe to member mainframe or on magnetic tape),
MasterCard edits the records, checking the data for accuracy and directs it to.
issuer bank.

b) Settlement : Clearing is the movement of data from the member to

83
MasterCard and from MasterCard to the member. Settlement is the process by
which funds are exchanged representing the net equivalent of monetary value
from clearing and billing processing. These funds are exchanged each day
between the banks for net monetary value of the cleared transactions.
MasterCard calculates the net position of each member involved in the clearing
process-and performs the functions of (a) sending advisements (b) Transferring
funds.

b) Means of Transferring Data : Acquiring Bank (HDFC Bank Ltd) sends and
receives data via a Master Card Interface processor (MIP). The file names which
are sent to master card have following description
10121501.512 --- The file name starting with 101 means this is outgoing file
for clearing. Next three digits (215 in this case) represent Julian date (Feb. 1 as
32 date) and next two digits represent the file number for that particular date
being transmitted.
10221501.asc The file name starting with 102 means this is incoming file
for settlement and clearing sent for previous day. Next two digits represent the
Julian date and four files will be received by Bank for everyday whether clearing
for previous day was sent or not.
Bank can also use other transmission methods instead of a MIP connection.
Following transmission methods are as follows :

Transfer data via dial-up access between remote personal computers and
central site based mainframe using modems and communication software
developed and licensed by MasterCard International.

MasterCard mainframe to bank's mainframe using dedicated network

communication facilities. Also referred to as "Complex - to Complex"

Send and receive data on magnetic tape via the postal service or courier.
Magnetic tapes are used to transmit data when a member is -

84
experiencing problems with connectivity to MasterCard.
Time frame for Clearing
An acquirer has 30 calendar days to process the transaction to the issuer.
An issuer must, however, accept a transaction submitted beyond the 30 day time
frame if the account is in good standing, or the transaction can be honored.
The 30 day time frame is measured as the time between the transaction date
and processing date. When calculating the number of days, do not count the
transaction date as day one, but do count the Central Processing Date. In
case the transaction is submitted to MasterCard for clearing with issuer
bank, issuer bank takes interchange fee of 1.1% of the transaction amount. But
if the transaction is submitted after 5 days then the interchange fee is 1.50% of
the transaction amount. Below is a diagram depicting the relationship of banks
during the various processing cycles.
Calculation of net Positions :
As HDFC Bank Ltd is acquiring Master Credit Cards and Maestro credit
cards along with the issuing of Meastro Debit Cards. MasterCard makes a net
settlement of all POS and ATM transactions for issuer and acquirer transactions.
MasterCard received incoming transaction date from between 9:01 A.M. and the
end of the fourth clearing (9:00A.M.) The next day (St., Louis Time) and then
the net position is calculated and settling bank is advised accordingly by
MasterCard along with the copy of the net position to acquiring and issuing
bank
Below is the diagram how the net position and settlement is done by
MasterCard international.
It is to- be noted that , Maestro Debit card settlement is done online by
MasterCard International and there is no need of sending these transactions
through clearing. But the net position will take into consideration these

85
transactions also.

VISA INTERNATIONAL :
As the bank is acquiring VISA cards also, the settlement procedure with VISA
International for acquiring of VISA cards on HDFC terminals is also one of the
requirements.
The outgoing files which are sent to Visa international will have the name as
ifftl.out. This means the file is for clearing and the file number is 1 for the date.
Similarly incoming files ifft 1.in is the file for incoming.
However VISA sends 16 files for clearing every day as compared to Master cards
4 files everyday.
Time frame of clearing with VISA International
An acquirer has 30 calendar days to process the transaction with the issuer. An
issuer must, however, accept a transaction submitted - beyond the 30 day time
frame if the account is in good standing, or the transaction can be honored.

The 30 day time frame is measured as the time between the transaction date
and processing date. When calculating the number of days, do not count the
transaction date as day done, but do count the Central Processing Date.

In case the transaction is submitted to VISA International for clearing with

issuer bank, issuer bank takes interchange fee of 1.1% of the transaction
amount. But if the transaction is submitted after 5 days then the interchange
fee is 1.50% of the transaction amount.
It is to be noted unlike with Maestro debit cards the settlement is not done
online for Visa Electron Debit cards. The claim with Visa International will be for

86
Credit Cards and Visa Electron Debit Cards also.
As Bank is not issuing any visa cards, so the net position for HDFC Bank Ltd as
on date with Visa transactions must be positive on any given date.
DISPUTED

TRANSACTIONS

BY

MASTER

CARD

AND

VISA

INTERNATIONAL
If a cardholder-disputes the transaction, issuer bank can raise a charge
back on acquiring bank through Master Card or Visa International.
The Charge back rules for MasterCard and VISA International are defined in the
next chapter.

CATEGORY - 2 (CARDHOLDER BASED SCHEMES)

As HDFC Bank Ltd. is issuer of Maestro -Debit Card, it is very important
that customers should be informed by way of schemes about the usage of
card other than ATMs only. Since we also plan to launch credit cards soon, it is
also essential that schemes for cardholders are launched from time to time.
Following Schemes can be floated which are popular in the market :-

1. Discounts to HDFC Bank Ltd. Cardholders : These kind of

schemes will benefit the bank in becoming Issuer and Acquirer of transactions
at the same time.

1. Lucky Draw Schemes : These schemes are useful to enhance the

usage of Debit Card at merchant outlets. E.g. E-bank club.

2. Loyalty programme schemes : One of most popular way to enhance

the usage of cards.
However other promotional and marketing activities will be an ongoing process
to maximise the acquiring business through HDFC cards.

87

Appendix

88

9.1 Appendix
Study Questionnaire

What are different types of plans provided by bank?

What are the administrative charges for Processing Loan?

What are your transaction limits ?

What are the distribution channels used by your bank for

Disbursement of Loan?

What are the value added services you are providing to your
Customer?

Who are your target customer and segment?

Salaried

Tourists

Industrialist

Foreign Tourist

What are the promotion tools used by the bank?

Print media

Road Shows

Trade Fair

Festival Offers

Hoarding

What are proceedings for POS terminal approval to merchants by

your bank ?

89

What is the procedure for POS approval by your bank?

What are the basic documents needed.

How many POS terminals do you have ?

90

Field Investigation Report

1. Residence: Name of Applicant: - ________________________________
Address of Applicant: -________________________________
_________________________________
Type Of House: Flat Chawl Bungalow Hutment Free Hold
Lease Hold
Residence is Easily Approachable From :Railway Station Bus Stop Not Easily App.
Residence Ownership :@ House/Flat Owned by Self / Spouse @ House/Flat Owned by Parents Of
applicant
@ House/Flat Owned by Parents Of Spouse
@ Other
Loan taken for Residence: Yes, Loan Amount Rs. ____________ EMI Rs.______ Outstanding Rs----------Name of Institution
No
Above informations verified from :Society Officers Name ___________________________
Neighbor
___________________________
Watchman ___________________________
Other _______________________________
Locality Of Residence :@ Posh
@ Upper Class @ Middle Class
@ Lower Class
Interior Impression :@ Well Maintained
@Avg. Maintained
@ Poorly Maintained
In Residence
:Phone T.V. Refrigerator
Music System A.C.
Cooler
How easy to Locate the house :@Easy
@Difficult
@ Unable to Locate
2. Residence Details :Details of Vehicle Owned :___________________________________________
___________________________________________
Details of Discussion
With Neighbors

:-

91
Details of Discussion with
Property Broker / Estate Broker :Detail of Discussion with
Society / Office

:-

Land Mark Observed

:___________________________________________
Loan Details
:Car : Market Cost Rs ___________ Car Loan Amount Rs _____________
EMI
Rs. _____________ Present Outstanding Rs.____________
3. Office
Office is Easily Approachable From :Railway Station
Bus Stop
Not Easily App.
Size of Office ( Sq. M. ) :Office / Business Premises :@ Owned
@ Parental @ Spouse @ Rental
Location of office :@Commercial Area @ Industrial Estate
@ Residential @ Other
Locality :@ Posh
@ Upper Class @ Middle Class
@ Lower Class
Furnishing: @ Well Furnished @ Avg. Furnishing @ Sparsely Furnished
Asset visible at time of field visit :Phone
Computer Fax
Photocopier A.C.
Number Of Employee Visible ________
Level of activity observed in office :@ High
@ Medium @ Low
@None
Salary / Income
Statutory Deductions
Other Deductions
Any feed back through Reference Checks
Name of the Field Officer
:________________________________________________
Date of Visit
:Observations of Field Officer :-

Signature Of Field Officer with date

Check box for multiple selections @ Radio Button for single selection

92
PRE SANCTION / PRE RELEASE / POST SANCTION MONITORING
SPOT VISIT / INSPECTION REPORT
(For properties proposed for Equitable Mortgage / Negative Lien )
Name of Account :.
Branch
Date of Visit

Region:

:.............................................. By :.....

Particulars of Property : (Brief Description).......

..Location : (Complete postal address to be
given).........---------------------------------------------------------------------Whether property
is built up or vacant plot?...........................................................................
Land Area....................... sq.mts

............----------.Cnstructed

area...........................
Year of construction..................................
Name of the owner(s)....................
Nature of Ownership : Free-hold / Lease hold/ Private Lease..........
....---------------------------OCCUpied by

: Owners/ Tenants/

Lessee....................................................................
............................................................................................
........
Purchase value / w.d.v. As on :......................................Rs....................lacs.
Valued of the property as per valuation report
dated.......................Rs..............................lacs.
Value of property in opinion of inspecting official :

Rs.............. .lacs.

(To be based on local independent inquiries from property delaers/ estate agent/
brokers)
Details of litigation/claims pending against the property (if
any) :.............................................
Whether complete chain of original title deeds is available for creating mortgage :
Yes / No

93
.................................................................................................................................
.................
Reasons for accepting NegativeLien instead of
mortgage :.......................................................
I have visited the site of above mentioned property and confirm the correctness
of the above information.
(Inspecting Official)
Name / Designation....................
...............................................................................................
Comments / Observations of Branch Manager

Signature

RATING SHEET OF APPLICANT WITH PARAMETERS AND SCORING criterion

NAME:
BRANCH:

PARAMETERS TOTA

MARKS

94
L
MAR
KS
TYPE OF
APPLICANT

10

AGE

EDUCATIONAL
QUALIFICAT-ION

OBTAINED
SALARIED

PROF-ESSIONAL

SELFEMOTHERS
PLOYED/BUSINESSM
8
AN
10
5
0
UPTO 25
ABOVE 25 & UPTO 40 ABOVE 40 & UPTO5 0 ABOVE 50 YEARS
YEARS
YEARS
YEARS
2
5
4
2
& OTHER GRADUATES INTERMATRIC
Ph.D/BDS/MB POSTGRADUATE
PROFES-SIONALS
MEDI-ATE
BS/BE/B.TECH 4
3
2
1

& ABOVE
Immovable
property 10
ownership (free from all
direct
or
indirect
encumbrance)
PERIOD OF STAY AT 5
CURRENT RESIDENCE
IF Non Salaried INCOME 10
ABOVE RS.2 LACS FOR
HOW MANY YEARS

10
ABOVE 5 YEARS
5
CONTIN-UOUSLY
FOR LAST 3 YEARS

5
ABOVE 2 YEARS & UPTO 5 YEARS
3
CONTUI-UOUSLYFOR LAST 2 YEARS

0
2 YEARS AND LESS
1
LAST YEAR

10
6
2
GOVT/PUBLIC
PUBLIC LIMITED
PRIVATE LIMITED OTHERS
SECTOR
10
6
4
2
ABOVE
10 ABOVE 5 YEARS & ABOVE 3
& ABOVE 1
& OTHERS
YEARS
UPTO 10 YRS
UPTO 5
UPTO 3 YEARS
YEARS
5
4
3
1
0
ABOVE
ABOVE RS.3 LACS ABOVE RS.2 LAC ABOVE RS.1 LAC BELOW
RS.5 LACS
&
UPTO
Rs.5 &
UPTO
RS.3 & UPTO RS.2 LAC
LACS
LACS
LAC
5
4
3
2
1

OR/IF SALARI-ED TYPE

OF EMPLOYER
WORK
EXPERIENCE

5
HOUSE/FLAT OWNED HOUSE/FLAT OWNED BY PARENTS OF OTHERS
BY SELF/SPOUSE
SELF/ SPOUSE

NETWORTH
OF 5
APPLICANT AS PER
STATEME-NT
OF
ASSETS & LIABILIITIES
NET WORTH TO LOAN 5
AMT RATIO

RS.1

RATIO OF COL-LATERAL 8
SECU-RITY PROVIDED
TO LOAN AMT

ABOVE 3 Above
Above 2 times Above
1.5 Above 1 times Up to 1
TIMES
2.5times
& & upto 2.5 times & upto 2 & upto 1.5 time
Upto 3 times times
times
times
5
4
3
2
1
0
2.5 times 2 times & less 1.5
times& 1 Times & upto 1.5 times
Less then
and
then 2.5 times Less then 2
1 Time
above
times
10
8
6
4
0
100% & above 50% to <100% 25% to <50%
10% to <25%
Less then
10%
8
4
3
2
0

TYPE OF COLLA-TERAL 2
SECURITY PROVIDED

NSC/LIC
POLICY/FD

NET MONTHLY INCOME 10

TO
MONTHLY
INSTALMENT OF LOAN
RATIO

GUARANTOR TYPE

GUARANTOR INCOME

Existing Customer with 10

Satisfactory Dealing

SHARES/
Others
IMMOVABLE
PROPERTY
2
1
0
SALARIED
PROFES-SIONAL SELF-EMPLOYED SALARIED
OTHERS
GOVT/PUB.
OTHER
SECTOR
SECTORS
5
4
2
2
0
GREATER THAN LESS
THAN LESS
THAN LESS THAN BORROWER &
BOR-ROWER
BORROWER & IT BORROWER & NON- NON-IT PAYER
PAYER
IT PAYER BUT GOVT
EMPL
5
3
2
0

For last more For last more For last more than 1 For last years For
less
than 3 Years
than 2 years & years and upto 2 and upto 1 years than

and
upto
3 years
Years
Years
10
8
5
3
0

95
TOTAL SCORE =

96

Bibliography

97
10.1 Bibliography
10.1.1 websites
www.hdfc.com
Merchant Establishment Reference Manual

Magazines

Financial Plus

Business India

Economic times

Material Provided by HDFC Bank Ltd.

Merchant Establishment Reference Manual

Search Engines

www.google.com

www.yahoo.com

www.altavista.com

www.msn.com

www.live.com

www.wikipedia

www.amazon.com

www.answers.com

98