DECLARATION

I hereby declare that this summer project report is prepared by me, based on original study
conducted by me at Mahindra Finance Ltd. under the guidance of Mrs.Chaitra.K.S. , Faculty, Bapuji
Academy of Management and Research, Lakeview Campus, S.S.layout, Davangere.
Further I declare that this report is my original work and has not been submitted to any other university
or Institute for the award of any Degree or Diploma.

Date:
Place: Davangere

Smitha.K.B.
Reg. No: 14MBA317

ACKNOWLEDGEMENT
A mammoth Summer Project report on Credit Appraisal Process with Special reference to
Mahindra Finance, of this nature calls for intellectual nourishment, professional help and encouragement
from many quarters. I would like to express my sincere gratitude.
Firstly, I would like to thank THE ALMIGHTLY and MY PARENTS for having showered
their blessings on me.
I express my obligations and gratitude towards Mahindra Finance, Davangere. For making the
arrangements for this incredible Summer Internship Project in the first Place and for their invaluable
guidance, suggestions and confidence in me.
I would like to thank Dr. Swamy Tribhuvananda, Principal, for giving me this opportunity to
work on this project.
My heartiest thanks to Mrs.Chaitra.K.S, Faculty, guide for her able guidance, valuable time, cooperation and inspiration without which this project study would not have been possible. I also thank all
my friends who have directly or indirectly contributed in making my project successful & bringing this
report to the present form.
Their contributions show in many suitable ways and were indeed instrumental in achieving the
final results. Last but not the least I am indebted to all those who remained behind the scene but without
their help this project would not have been palpable.

Date:
Place: Davangere

Smitha.K.B.
Reg No: 14MBA317

CONTENTS
PARTICULARS

CHAPTERS

PAGE No.

EXECUTIVE SUMMARY

INTRODUCTION

INDUSTRY PROFILE

COMPANY PROFILE

6-16

RESEARCH METHODOLOGY

17-22

DATA ANALYSIS AND INTERPRETTION

FINDINGS AND SUGGESTIONS

BIBLIOGRAPHY

2-5

23-34

35-37

38

LIST OF TABLES
Table No.

PARTICULARS

Page numbers

Table 1

Management of Mahindra Finance

Table 2

Table shows loans and advances issued

23

Table 3

Table shows percentage of NPA

25

Table 4

Table shows percentage of yield on loans

27

Table 5

Table shows total loans disbursed

29

Table 6

Table shows total secured loans

31

Table 7

Table shows total unsecured loans

33

LIST OF GRAPHS
Table No.

PARTICULARS

Page numbers

Graph 1

Graph shows loans and advances issued

24

Graph 2

Graph shows percentage of NPA

26

Graph 3

Graph shows percentage of yield on loans

28

Graph 4

Graph shows total loans disbursed

30

Graph 5

Graph shows total secured loans

32

Graph 6

Graph shows total unsecured loans

34

EXECUTIVE SUMMARY
Credit Appraisal is a process to ascertain the risks associated with the extension of the credit
facility. It is generally carried by the financial institutions which are involved in providing financial
funding to its customers. Credit risk is a risk related to non repayment of the credit obtained by the
customer of a bank. Thus it is necessary to appraise the credibility of the customer in order to mitigate
the credit risk. Generally the credit facilities are extended against the security know as collateral. But
even though the loans are backed by the collateral, banks are normally interested in the actual loan
amount to be repaid along with the interest. Thus, the customer's cash flows are ascertained to ensure the
timely payment of principal and the interest.
It is the process of appraising the credit worthiness of a loan applicant. Factors like age, income,
number of dependents, nature of employment, continuity of employment, repayment capacity, previous
loans, credit cards, etc. are taken into account while appraising the credit worthiness of a person. Every
bank or lending institution has its own panel of officials for this purpose.
Credit is the provision of resources (such as granting a loan) by one party to another party where
that second party does not reimburse the first party immediately, thereby generating a debt, and instead
arranges either to repay or return those resources (or material(s) of equal value) at a later date. The first
party is called a creditor, also known as a lender, while the second party is called a debtor, also known as
a borrower.

The topic, CREDIT APPRAISAL PROCESS OF MAHINDRA FINANCE demanded an

elaborate study of the presently followed credit appraisal process of Mahindra Finance, make
suggestions regarding betterment of the whole system if any, and finally base all the above on solid
research work.
I first tracked down the Credit Appraisal Process of Mahindra Finance. I collected Secondary
data of 5 years Annual Reports of MMFSL from 2010 to 2015, Balance Sheet, Profit and Loss account.
Based on that I tabulated all the data, analyzed them using Microsoft Excel and finally made the
interpretation of the observation.
At the end, I made some of my own suggestions.