EXECUTIVE SUMMA

Banks in India have traditionally offered mass banking products. Most common deposit products being Savings Bank, Current Account, Term deposit Account and lending products being Cash Credit and Term Loans. Due to Reserve Bank of India guidelines, Banks have had little to do besides accepting deposits at rates fixed by Reserve Bank of India and lend amount arrived by the formula stipulated by Reserve Bank of India at rates prescribed by the latter. PLR (Prime lending rate) was the benchmark for interest on the lending products. But PLR itself was, more often than not, dictated by RBI. Further, remittance products were limited to issuance of Drafts, Telegraphic Transfers, Bankers Cheque and Internal Transfer of funds. In view of several developments in the 1990s, the entire banking products structure has undergone a major change. As part of the economic reforms, banking industry has been deregulated and made competitive. New players have added to the competition. IT revolution has made it possible to provide ease and flexibility in operations to customers. Rapid strides in information technology have, in fact, redefined the role and structure of banking in India. Further, due to exposure to global trends after Information explosion led by Internet, customers - both Individuals and Corporates - are now demanding

better services with more products from their banks. Financial market has turned into a buyer's market. Banks are also changing with time and are trying to become one-stop financial supermarkets. Market focus is shifting from mass banking products to class banking with introduction of value added and customised products. A few foreign & private sector banks have already introduced customized banking products like Investment Advisory Services, SGL II accounts, Photo-credit cards, Cash Management services, Investment products and Tax Advisory services. A few banks have gone in to market mutual fund schemes. Eventually, the Banks plan to market bonds and debentures, when allowed. Insurance peddling by Banks will be a reality soon. The recent Credit Policy of RBI announced on 27.4.2000 has further facilitated the entry of banks in this sector. Banks also offer advisory services termed as 'private banking' - to "high relationship - value" clients. The bank of the future has to be essentially a marketing organization that also sells banking products. New distribution channels are being used; more & more banks are outsourcing services like disbursement and servicing of consumer loans, Credit card business. Direct Selling Agents (DSAs) of various Banks go out and sell their products. They make house calls to get the application form filled in properly and also take your passport-sized
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photo. Home banking has already become common, where you can order a draft or cash over phone/internet and have it delivered home. ICICI bank was the first among the new private banks to launch its net banking service, called Infinity. It allows the user to access account information over a secure line, request cheque books and stop payment, and even transfer funds between ICICI Bank accounts. Citibank has been offering net banking to its Suvidha program to customers. Products like debit cards, flexi deposits, ATM cards, personal loans including consumer loans, housing loans and vehicle loans have been introduced by a number of banks. Corporates are also deriving benefit from the increased variety of products and competition among the banks. Certificates of deposit, Commercial papers, Non-convertible Debentures (NCDs) that can be traded in the secondary market are gaining popularity. Recently, market has also seen major developments in treasury advisory services. With the introduction of Rupee floating rates for deposits as well as advances, products like interest rate swaps and forward rate agreements for foreign exchange, risk management products like forward contract, option contract, currency swap are offered by almost every authorized dealer bank in the market. The list is growing.
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Public Sector Banks like SBI have also started focusing on this area. SBI plans to open 100 new branches called Personal Banking Branches (PBB) this year. The PNBs will also market SBI's entire spectrum of loan products: housing loans, car loans, personal loans, consumer durable loans, education loans, loans against share, financing against gold.

INTRODUCTION TO BANKING SYSTEM

The ancient banking system of India constituted of indigenous bankers. They have been carrying on their age old banking operations in different parts of the country under different names. Then came commercial banking in 1770 with the establishment of the first joint stock bank, named the Bank of Hindustan, by an English Agency in Calcutta, but this bank failed in 1832. In fact, real beginning of modern commercial banking in the country was made with the establishment of the Bank of Bengal 1806, Later on, the Bank of Bombay and Bank of Madras were also set up in 1840 and 1843 respectively. All these banks were called Presidency Banks.

In 1881, the first purely Indian Bank i.e. Ouch Commercial Bank came into being. It was followed by the setting up of Punjab National Bank in 1894.

The commercial banking system is divided into 2 categories. Public Sector Banks Private Sector Banks

STRUCTURE OF INDIAN COMMERCIAL BANKING SYSTEM

Public Sector Banking

Private Sector Banking

SBI

SBI Associates

Nationalized Banks

Scheduled

Non Scheduled

Indian Banks

Foreign Banks

OBJECTIVES
This project was carried with the following objectives: To see whether people are aware of both Banks products and services. To know whether people having their accounts with both Banks are satisfied with the services provided by the bank. To impart useful information regarding the products and services to the potential customers.

RESEARCH METHODOLOGY

My research project has a specified framework for collecting the data in an effective manner. Such framework is called Research Design. The research process which was followed by me consisted following steps. A. Defining the Problem & Research Objectives The definition of problem includes the study of awareness of UTI and ICICI Banks products and services. B. Developing The Research Plan : The development of Research Plan has the following Steps: 1. Data Sources Two types of data were taken into consideration i.e. Secondary data & primary data. My major emphasis was on gathering the primary data. The secondary data has been used to make things more clear.

(i)

Primary Data : Direct collection of data from the source of information, technology including personal interviewing, survey etc.

(ii)

Secondary Data : Indirect collection of data from sources containing past or recent past information like Banks Brochures, Annual Publications, Books, Newspaper & Magazines etc.

2. Research Approach Surveys are best suited for Descriptive Research. Surveys are undertaken to learn about peoples knowledge, beliefs, preferences, satisfactions & so on and to measure these magnitudes in the general public. Therefore I have done this Survey for the Descriptive Research Process. 3. Research Instrument A close friend questionnaire was constructed for my survey. A Questionnaire consisting a set of questions was presented to respondents for their answers.
4.

Sampling Plan The sampling plan calls for three decisions.

(a)

Sampling Unit : Who is to be surveyed ? The target population must be defined that has to be sampled. It is necessary so as to develop a sampling frame so that everyone in the target population has an equal chance of being sampled. I have completed my survey in Jalandhar City of Punjab.

(b)

Sample Size : How many people have to be surveyed ? Generally large sample gives more reliable results than small samples. The sample consisted of 150 respondents. The sample was drawn from people having different educational qualifications, occupations and age group. The selection of the respondents was done on the basis of simple random sampling.

5. Contact Methods Once the sampling plan has been determined, the question is how the subject should be contracted i.e. by telephone, mail or personal interview. Here in this survey, I have contacted the respondents through personal interviews. C. Collecting the Information After this, I have collected the information from the respondents with the help of questionnaire.

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D.

Analyze the Information

The next step is to extract the pertinent findings from the collected data. I have tabulated the collected data & developed frequency distributions. Thus the whole data was grouped aspect wise and was presented in tabular form. Thus, frequencies & percentages were prepared to render impact of the study.

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LIMITATIONS OF THE STUDY

Due to paucity of time and resources a countrywide survey was not possible. Hence only Jalandhar district has been taken for the study.

Since a smaller sample was chosen so it may not be a true representative of the population under study.

The possibility of the respondents responses being biased cannot be ruled out.

Limited access to secondary data pertaining to UTI Banks performance in other regions or any other information was another problem in finding a correct market response.

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MODERN SYSTEM OF BANKING

Modern banking system is totally different from past banking system. The Indian banking industry juxtaposed with other countries, recognizing the differences between the developed and the emerging economies at present .

I.

Status of Indian banking industry :

First, The structure of the industry : In the worlds top 1000 banks, there are many more large and medium-sized domestic banks from the developed countries than from the emerging economies. Illustratively, according to The Banker 2004, out of the top 1000 banks globally, over 200 are located in USA, just above 100 in Japan, over 80 in Germany, over 40 in Spain and around 40 in the UK. Even China has as many as 16 banks within the top 1000, out of which, as many as 14 are in the top 500. India, on the other hand, had 20 banks within the top 1000 out of which only 6 were within the top 500 banks. This is perhaps reflective of differences in size of economies and of the financial sectors.

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Second, the Share of bank assets in the aggregate financial sector assets : In most emerging markets, banking sector assets comprise well over 80 per cent of total financial sector assets, whereas these figures are much lower in the developed economies. Furthermore, deposits as a share of total bank liabilities have declined since 1990 in many developed countries, while in developing countries public deposits continue to be dominant in banks. In India, the share of banking assets in total financial sector assets is around 75 per cent, as of end-March 2006. There is, no doubt, merit in recognizing the importance of diversification in the institutional and instrument-specific aspects of financial intermediation in the interests of wider choice, competition and stability. However, the dominant role of banks in financial intermediation in emerging economies and particularly in India, will continue in the medium-term; and the banks will continue to be special for a long time. In this regard, it is useful to emphasize the dominance of banks in the developing countries in promoting non-bank financial intermediaries and services including in development of debt-markets. Even where role of banks is apparently diminishing in emerging markets, substantively, they continue to play a leading role in non-banking financing activities, including the development of financial markets.

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Third, Internationalisation of banking operations : The foreign controlled banking assets, as a proportion of total domestic banking assets, increased significantly in several European countries (Austria, Ireland, Spain, Germany and Nordic countries), but increases have been fairly small in some others (UK and Switzerland). Amongst the emerging economies, while there was marked increase of foreign-controlled ownership in several Latin American economies, the increase has, at best, been modest in the Asian economies. Available evidence seems to indicate some correlation between the extent of liberalisation of capital account in the emerging markets and the share of assets controlled by foreign banks. As per the evidence available, the foreign banks in India, which are present in the form of branches, seem to enjoy greater freedom in their operations, including retail banking, in the country on par with domestic banks, as compared with most of the other developing countries. Furthermore, the profitability of their operations in India is considerably higher than that of the domesticallyowned banks and, in fact, is higher than the foreign banks operations in most other developing countries. India continues to grant branch licences more liberally than the commitments made to the WTO.

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Fourth, Share of state-owned banks in total banking sector assets Emerging economies, with predominantly Government-owned banks, tend to have much higher state-ownership of banks compared to their developed counterparts. While many emerging countries chose to privatise their public sector banking industry after a process of absorption of the overhang problems by the Government, we have encouraged state-run banks to diversify ownership by inducting private share capital through public offerings rather than by strategic sales and still absorb the overhang problems. The process has helped reduce the burden on the Government, enhance transparency, encourage market discipline and improve efficiency as reflected in stock market valuation, promote efficient new private sector banks, while drastically reducing the share of the wholly government owned public sector banks in a rapidly growing industry. Our successful reform of public sector banks is a good example of a dynamic mix of public and private ownership in banks.

A noteworthy feature of banking reforms in India is the growth of newly licensed private sector banks, some of which have attained globally best standards in terms of technology, services and sophistication. In many respects related to performance, these domestically promoted banks have

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surpassed branches of foreign banks in India, and could be a role model for other banks.

II. Challenges Ahead

There are also some challenges which can have a key bearing on the ability of Indian banks to remain competitive and enhance soundness. Needless to state, these are more in the nature of random thoughts, rather than any structured thinking, and are meant to invite discussion.

First, Cost Management. Cost containment is a key to sustainability of bank profits as well as their long-term viability. To highlight this point, let me, take recourse to some figures. In 2003, operating costs of banks as a proportion of total average assets1[1] in the UK were 2.12 per cent, for those in Switzerland they were 2.03 per cent, and less than 2 per cent in major European economies like Sweden, Austria, Germany and France. In India, however, in 2003, operating costs as proportion of total assets of scheduled commercial banks stood at 2.24 per cent. The tasks ahead are thus clear and within reach.

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Second, Recovery Management. This is a key to the stability of the banking sector. There should be no hesitation in stating that Indian banks have done a remarkable job in containment of non-performing loans (NPL) considering the overhang issues and overall difficult environment. Let me add that for 2004, the net NPL ratio for the Indian scheduled commercial banks at 2.9 per cent is ample testimony to the impressive efforts being made by our banking system. In fact, recovery management is also linked to the banks interest margins. We must recognise that cost and recovery management supported by enabling legal framework hold the key to future health and competitiveness of the Indian banks. No doubt, improving recovery-management in India is an area requiring expeditious and effective actions in legal, institutional and judicial processes.

Third, Technological Intensity of Banking: This is one area where perhaps India needs to do significant catching up, notwithstanding the rapid strides made over the last few years, though data on this score are difficult to come by. Some available figures indicate that in late 1999, the percentage of customers using online banking was less than 1 per cent in India, compared with anywhere between 6-30 per cent in developed economies like US, UK, Germany, Finland and Sweden. Even in Latin
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America, these figures are much higher than for India. While admittedly the numbers for India are likely to be much higher at present than these figures suggest, so would be the case for these other economies as well. The issue, therefore, remains what has been the extent of catching up by India on this score? In fact, this seems somewhat intriguing: India happens to be a world leader in information technology, but its usage by our banking system is somewhat muted. It is wise for Indian banks to exploit this globally state-ofart expertise, domestically available, to their fullest advantage.

Fourth, Risk Management. Banking in modern economies is all about risk management. The successful negotiation and implementation of Basel II Accord is likely to lead to an even sharper focus on the risk measurement and risk management at the institutional level. Thankfully, the Basel Committee has, through its various publications, provided useful guidelines on managing the various facets of risk. The institution of sound risk management practices would be an important pillar for staying ahead of the competition. Banks can, on their part, formulate early warning indicators suited to their own requirements, business profile and risk appetite in order to better monitor and manage risks.

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Fifth, Governance. The recent irregularities involving accounting firms in the US have amply demonstrated the importance of good corporate governance practices. The quality of corporate governance in the banks becomes critical as competition intensifies, banks strive to retain their client base, and regulators move out of controls and micro-regulation. As already mentioned, banks are special in emerging markets since they take a leading role in development of other financial intermediaries and of financial markets, apart from having a large recourse to public deposits. No doubt, there is nothing like an optimal level of governance for one to be satisfied with. The objective should be to continuously strive for excellence. The RBI has, on its part, made significant efforts to improve governance practices in banks, drawing upon international best practices. It is heartening to note that corporate governance presently finds explicit mention in the annual reports of several banks. The improved corporate governance practice would also provide an opportunity to accord greater freedom to the banks boards and move away from micro regulation to macro management. Banks in India are custodians of depositors monies, monies of the millions of depositors who are seeking safe avenues for their hard earned savings, and hence, banks must accept and perform an effective fiduciary role. In this light, improvement in policy-framework, regulatory regime, market-

20

perceptions, and indeed, popular sentiments relating to governance in banks need to be on the top of the agenda to serve our societys needs and realities while being in harmony with the global perspective.

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STRATEGIES TO MEET OUT THE CHALLENGES

A bank can follow the following strategies to compete in the modern banking system

i ) Customer is the king:

To meet these customer concerns, banks must elevate messages of security and reorganize their fraud-fighting efforts to involve not only bank security, education and product design but also, perhaps for the first time in history, the customer. Organizations need to be realigned around fraud prevention and detection. Security specialists can no longer be kept behind closed doors, charged with detecting fraud on the customers' behalf. Rather, these knowledgeable specialists must be organized in triad teams, integrating security knowledge with individuals who determine the communications that have the potential to change consumer behavior, and the customer interface specialists who design products and even training programs used in online banking, ATMs, and even branch systems and employee training programs Security, education and product design specialists each play a valuable role in deputizing the customer. And as they increasingly work

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together in this role, customers can be invited to prevent and detect fraud on their own behalf. This customer role is critical because customers have unsurpassed motivation and knowledge of their personal transaction patterns. And never before have banks been in a position to deputize customers to protect their own accounts. This can be done by providing customers with more current information on account activity through a variety of channels and notification methods and profiling systems.

ii) Leveraging New Channels :

In order to increase customer security, banks must also fully embrace (rather than blame) new channels such as the Internet. It is nave and wholly ineffective to respond to the inherent risks of electronic banking and payments while not also taking advantage of the exclusive new strengths that these new channels bring. Banks that operate or communicate as if new channels represent only heightened risk are most likely to suffer the greatest loss, not only in malicious activity but also in reduced growth and profitability.

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Customers must be educated about the risks of the Internet and any other new channel in the same way as new automobile drivers are expected to be thoroughly prepared for their added responsibility. In addition to detection, banks must also harness the inherent potential of new channels for their use in fraud prevention. For example, online banking excels in the ability to prevent many cases of identity theft while deputizing customers to detect fraud with greater efficacy. Identity fraud begins with identity theft, which is the illicit access to personal information for the express purposes of committing a crime in another's name. With electronic channels, paper delivery of statements and other private documents can be eliminated, moving many potential victims out of harm's way.

iii) Educational Messages :

A balanced approach begins with education, yet today's educational messages often scare customers away from the remedy or simply leave them in the dark. Such imbalance and omission in the critical area of education not only deprives customers of essential information, but it also gives the impression that new channels are for those who are willing to endure

24

significant risk. Certainly, "Web-phobic" messages will also result in customers who will remain ignorant of how to use new channels to more effectively prevent and detect fraud. And yet, if new channels bring both risk and safety (primarily dependent on the degree to which customers have been properly educated), one-sided educational approaches will serve to scare away some customers from the very protection offered by new electronic channels. As an example of balanced education and cautionary messages, banks should educate their customers on the protection of passwords, PINs and paper statements. They should also show customers how to avoid criminals who might pose as bank agents through Internet, phone or even in-person channels; eliminate access to their private data by turning off paper statements; understand the virtues of frequent account-monitoring; learn how to reject bogus requests for personal data and install firewalls and anti-virus software.

Thus account security is a heightened customer requirement, and banks must elevate and reorganize their security efforts to meet the new threats and concerns. The concept of self-service made possible by electronic channels must now be extended to a new realm, that of self-security. Multi-channel relationships, sophisticated customers and even more sophisticated criminals

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are now an essential part of modern banking relationships. To preserve their customers' trust, banks must engage their security, product and communications teams around the customer, and communicate to accountholders with balanced messages.

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INTRODUCTION TO UTI BANK

The unit trust of India Limted(UTI bank) was amongst the first to achieve an in princple approval from the Reserve Bank of India (RBI) to set up a bank in the private sector as part of the RBIs liberalization of the Indian Banking Industry. It was incorporated in August 1994 in the name of UTI Bank Limited with its registered office in Mumbai. It began its operations as a scheduled commercial Bank in January 1995. Lineage :

. In 1994 UTI Bank, into a strategic alliance with the jointly by the Administration of the specified undertaking of unit trust of India ,life insurance corporation of India ltd.which acquired 20% of its equity. The promoter of the Bank, UTI is Indias premier housing finance company. It enjoys an inacceptable track record in India as well as in International Market. Since its inception in 1997, UTI has maintained a consistent growth in its operations and profitability and over the past 5 years it has achieved annual growth rate of 25-30%. Its outstanding loan portfolio covers over a million dwelling units.

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UTI Bank :

The banking industry was thrown open to private sector by Government of India in 1994 in the constitution of its policy of economic liberalization and privatization. UTI Bank is a scheduled commercial bank, promoted by the Housing Development Finance Co-Operation (which was promoted by GIC, LIC, World Bank & UTI). Mission Statement

To build a sound customer franchise across distinct businesses so as to be the preferred provider of banking services in the niche segments that the bank operates in and to achieve healthy growth in profitability, consistent with the banks risk appetite.

To ensure the highest level of ethical standards, professional integrity and regulatory compliance. Organization Structure :

UTI Bank is a two tier organization, head office and Branch Office. It has been done so as to make decision making more responsive to the needs of
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the customers. The branches are directly linked to the head office at Mumbai. The bank presently has 420 branches. Business Focus:

Commercial Sector Forex Business Personal Banking Segment

Distribution Network :

UTI Banks head-quarter is in Mumbai. It presently has a network of around 420 branches and ATMs spread across the country. The branch network will be extended to cover major cities in India, as well as some semi-urban locations in line with RBI guidelines. Mumbai, Calcutta, Chennai and Delhi are supported by phone Banking Centres.

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Products & Services Of UTI Bank

UTI Bank, an Indian Bank offers International standards of service to its customers. People get professional and speedy service with its dedicated staff together with the latest technology in banking. UTI Bank brings a comprehensive range of products and services. Each is designed to minimize your efforts, making it so much simple for you to do your banking. The bank has 131 branches in 52 locations and around 235 ATMs across the country.

The bank provides the following options : Saving Account Current Account Fixed Deposit UTI Bank Plus Sweep in Account Super Saver Account Phone Banking ATM24 hour banking

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Mobile Banking Net Banking Bill Pay Debit Card

Saving Account :

UTI Bank offers more than useful facilities through its saving account. The account can be opened with minimum balance of Rs. 5000 and the person gets free ATM card, inter branch banking, net banking, bill pay and phone banking amongst plenty of other services. Current Account:

The Current Account is most suitable for business class people.With UTI Banks current account, one can get personalized cheque book, inter branch banking and a monthly account statement in addition to host of other features. The Bank provides two types of current account facilities.
a)

Current Account Regula r With minimum average balance of Rs. 10,000

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 In case of non-maintenance Rs. 300 per quarter 50 cheques leave free

b) Current Account-Premium Minimum average balance Rs. 25000. In case of non maintenance Rs. 600 per quarter. Cheque books free. Fixed Deposit : The bank provides the facility of fixed deposit which can be opened with minimum deposit of Rs. 10000. All fixed deposits are cluster deposits held in units of RS. 1. The interest rate of fixed deposits are as under : Period 15 days to 29 days 30 days to 60 days 91 days to 180 days 6 months to 1 day 1 year 1 year 1 day to 5 years Saving account UTI Bank Plus : Amount Below Rs. 25 lacs Interest Rate 5% 7.25% 8.00% 8.5% 8.5% 4% p.a.

This is a CURRENT ACCOUNT that offers you much more than just quick and reliable service. Now one can transfer up to Rs. 50 Lakhs per month free between the four metros. One can also get cheque clearing between four
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metros, courier facility, phone banking and personalized cheque book among a whole range of services all free of cost. In addition one can get cash delivery, home delivery of DDs, Cheque protection facility, outstation cheques clearance facility etc. Sweep In Account: Features a) Easy to operate ; Money gets automatically swept into your saving account, without any bother. b) Operate your account through cheque or by ATM: Gives you instant access to your deposit, whenever you need it. c) Minimum interest loss: Since your deposits are held in units of Re.1, you only encash the exact amount withdrawn. d) Access your money free of cost: There are no hidden charges in the day to day operations of your sweep in account. e) Link Several Deposits together : Open a new deposit for Rs. 5000 and it will be linked to your sweep in account. How does sweep in account work ? Since deposit in account holds your money in a fixed deposit in units of Re.1, every time money is transferred from your fixed deposit to your saving

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account, interest loss in minimized further you lose 1% of normal interest on the amount transferred from your fixed de posit. The rest of your deposit continues to earn the original rate till maturity. There are more benefits of course. You can if you like, always open as on deposit for just Rs. 5000. Further, you can link as many deposit, the Sweep in automatically choose the oldest deposit first before sweeping money into your saving accounts. Super Saver Account : Why keep your money in a Saving Bank Account and earn only 4.5% p.a. when you can earn much more? UTI bank presents the Super Saver Account, prudent option to a saving account. You can earn high interest of a fixed deposit and that without losing the liquidity you enjoy with UTI Saving Account. Free ATM Card : With every Super Saver Account you can get a free ATM Card. This allows you to enjoy 24 hours banking, 365 days a year including Sundays & bank holiday. Phone Banking :

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This is another convenient channel for the Banks customers to deal with the Bank for variety of services like checking account details, request for an account statement, order a draft, report lost ATM Card, Stop Cheque payment, Open a fixed deposit. Enquire on cheque status, pay utility bills etc. Mobile Banking : Banking on the Mobile phone .UTI Bank was the first to introduce banking on the mobile phone in India. Customers can check their savings account balance, request for a cheque book or stop payments. Recently, UTI Bank has joined hands with Spice Telecom, the mobile cellular service provides for the Punjab Region and Chandigarh to provide mobile banking and mobile pay facility in the region. The facility will allow the customers to access their bank accounts, make enquiries for balance and last three transactions request for a statement, cheque book and stop payment. Net Banking: Online internet banking is finally here-with banking from UTI. So now, when you make a transaction, that affects your balance, you dont have to wait for it to be updated, it's instantly reflected in your account balance. You can even view it in your statement.

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Benefits: a) Funds Transfer: Net Banking makes it easy to transfer funds between any of your accounts, even if they are in different branches/cities. b) New FD Request You can even open a FD Account on the net. All you need to do is give details regarding the account from which you want to tranfer funds, the amount and term for which you would like to make the FD, the branch at which you would like to make the FD and relevant maturity instruction if the term of your FD exceeds 6 months and also select whether you want to receive interest quarterly or on maturity. Bill Pay: In Mumbai this facility enables you to pay all your BPL Mobile, Max Touch BSES and MSEB bills, over the phone as well as through ATMs. In Delhi, you can pay your Airtel Bills and in Chennai you can pay your PRG and Sky Cell Cellular bills through this facility, shortly you will also be able to pay your BEST bills in Mumbai and Delhi. So you wont have to spend time is long queues or writing cheques. Debit Card :

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UTI Bank has recently launched the International Debit Card in Mumbai and Delhi in association with VISA. The card functions as an ATM Card and can be used at any of the UTI Bank ATMs or the VISA Plus network. You can also use it while shopping at over 8000 VISA electron merchant outlets, across India. The amount you spend on your card will be automatically debited from your saving account so whenever you spend, your card will be automatically debited from your saving account, so whenever you go shopping you wont have to carry cash. For transaction at VISA/PLUS ATMs following charges apply. Domestic Visa/Plus Atm Location Cash Withdrawal per transaction Balance enquiry per transaction International Visa/Plus Atm Location Cash Withdrawal per transaction Balance enquiry per transaction Rs. 110 RS. 10 Rs. 55 RS. 10

INTRODUCTION TO ICICI BANK

ICICI Bank is Indias second largest bank with total assets of over Rs.1 trillion and a network of about 540 branches and offices and over 1750

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ATMs. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries and affiliates in the area of investment banking, life and non-life insurance, venture capital, asset management and information technology. ICICI Banks equity shares are listed in India on stock exchanges at Chennai, Delhi, Kolkata and Vadodara, the stock exchange, Mumbai and the national stock exchange of India limited. Its American Depositories Receipts (ADRs) are listed on the New York Stock Exchange (NYSE) ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution and was its wholly owned subsidiary. ICICIs shareholding in ICICI Bank was reduced to 46% through a offering of shares in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Banks acquisition of Bank of Madura Limited in an all stock amalgamation in fiscal 2001 and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at the initiative of the World Bank, the Government of India and representatives of Indian industry. The principal objective was to create a development financial institution for providing medium-term and longterm project financing to Indian businesses, in the 1990s. ICICI transformed

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its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services, both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI became the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE After consideration of various corporate structuring alternatives in the context of the emerging competitive scenario in the Indian banking industry and the move towards universal banking, the managements of ICICI and ICICI Bank formed the view that the merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities and would create the optimal legal structure for the ICICI groups universal banking strategy. The merger would enhance value for ICICI Bank shareholders through a large capital base and scale of operations, seamless access to ICICIs strong corporate relationships built up over five decades, entry into new business segments, higher market share in various business segments, particularly fee-based services and access to the vast talent pool of ICICI and its subsidiaries. In October 2001, the Board of Directors of ICICI and ICICI Bank approved the merger of ICICI and two of its wholly owned retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI

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Capital Services Limited, with ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at Ahmedabad in March 2002 and by the High Court of Judicature at Bombay and the Reserve Bank of India in April 2002. Consequent to the merger, the ICICI groups financing and banking operations, both wholesale and retail, have been integrated in a single entity.

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2) Highlighting Features:

Banking hours from 8a.m. to 8p.m. six days a week. Automatic transfer of amount from Quantum Optima to Fixed Deposits for maximizing the interest income. Deposit Rs.600 p.m. and get Rs.1 lakh after 10 years or deposit Rs.1500 p.m.and get more than Rs1 lakh after 5 years with no TDS on interest earned. Debit Card and chequebook issued on the spot while opening account free of cost. Anywhere Banking facility of operating account from any of 540 branches in the country. Largest network of 13 ATMs and 4 offices in Ludhiana. Convenience of accessing your accounts on phone and through Internet 24 hours a day. Special interest rates for senior citizens. Special accounts for children with ATM. Roaming Current Account with cheques payable at par and other facilities.

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 Lockers available from 8A.M. to 8P.M. six days a week. Instant Credit of salary in accounts and other facility. Easy and quick remittance from foreign countries. Remittance from Canada in just 2 working hours. Advisory services for investment in Tax Free RBI Bonds, Mutual Funds, Tax Saving Bonds etc.

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Products & Services Of ICICI Bank

Kid-e-bank: Banking was never this much fun. This product teaches children banking and e-commerce transactions through an interactive online interface. Bank @ campus Student banking services : Student life isnt a 9 to 5 lifestyle. Heres a product that offers time and location independent banking solutions to the student community.

Power Pay Pay Roll Account : A feature rich corporate payroll account packed with powerful advantages for both employers and their employees. Convenience is the hallmark of this unique facility. It frees employers from cumbersome paperwork and employees from delays in accessing their money. ICICI Select :

Customized and integrated financial solutions for high-net worth clients. The emphasis on strong personal relationships and the use of state-of-the-art technology ensures best in class service for our clients

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NRI Services:

A wide range of services tailored to the specific needs of NRIs. Internet banking, remittance, tax advisory and investment facilities ensure that we are their first choice for dependable solutions.

Business Multiplier Account : A premium Current Account that understands the need of the small business segments. Features include the flexibility to earn interest on funds, making it a truly profitable Current Account Senior Citizens Special Deposit Scheme:

The special deposit scheme offers preferential interest rates to senior citizens. ICICI Ncash: Combining the acceptability of a credit card and the prudence of an ATM Card, the globally accepted ICICI Ncash debit card is a convenient accessory for customers.

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Credit Cards :

ICICI Bank offers the most powerful co-branded card, the ICICI HPCL card, with unmatched features and benefits. Beside this, it offers 3 types of credit cards to choose from Solid Gold (the global card), Sterling Silver (the family card) and True Blue (the value for money card). ICICI Bank credit cards also provide a host of other services like dial-a-draft, cash advance facility, interest banking, travel benefits and others. ICICI Bank Loans Against Shares:

Enhance liquidity without relinquishing share ownership. Uniquely structured so that investors are charged only on the amount withdrawn and the time span for which the funds have been utilized. Recurring Deposit:

A small saving every month adds to a sizable sum. Just save a small amount every month in ICICI Bank Recurring Deposit and get back a big sum at the end of tenure.

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ICICI Bank Munshi ICICI Bank Munshi is the new online services, providing a complete range of accounting and taxation services for managing ones personal finance and investments.

ICICI Bank Bureau de change : Whether its foreign currency or travelers cheque, bureau de change will help to organize ones business travel requirements and make traveling abroad a smooth affair.

Demat Services : Takes away the risk associated with holding physical certificates while still offering the client 24 hours access to his investments through electronic delivery.

ICICI Bank Money 2 India : Now transferring money to India is more convenient and quick. With ICICI Bank Money 2 India facility, one can transfer funds to India by: Power Transfer; DD Drawing arrangements; Wire Transfer or Cheque / Draft.

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ICICI Bank Live your dreams :

ICICI Bank offers a convenient online service to its customers. One can avail any of the following services only by logging on to

www.icicibank.com Account information E-cheques Bill payment Service request Credit cards

4) Loans & Advances :

Home Loans : ICICI bank offers the most attractive interest rates, along with the complete doorstep service. Loans ranging from Rs.1 lakh to Rs.1 crore are available, with repayment periods upto 30 years. Each home loan comes with a free accident insurance cover. Moreover no guarantees are required and there are no charges.

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Personal Loans : An all purpose customer friendly loan with no security, collateral or guarantors, available from as low as Rs.20,000 to Rs.5 lakh with a wide range of repayment tenures.

Car Loans: ICICI Bank Car Loans are tailored to suit your needs. You can avail of finance up to 90% of the value of car. Most attractive interest rates coupled with customized loan options and tenures ensure the best possible deal for you. Consumer Durable Loans : Furnish your dream home avail of loans for colour TVs, refrigerators, washing machines, microwave ovens or music systems. A minimum loan of Rs.7000 repayable in convenient options of 6 to 36 monthly installments is offered. Loans against Securities : Loans by the way of an overdraft facility against the pledge of Demat Securities provided by ICICI Bank. The best interest rates and loads of value added services come with this loan.

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Two Wheeler Loans : ICICI Bank provides customized options to ensure that you get the best value with great ease. Just fill up a form and avail of up to 85% of finance. 5) Investment Products

Govt. of India Relief Bonds : Govt. of India Relief Bonds allows one another avenue to earn tax-free interest on investments and exemption from wealth tax.

Mutual Funds : Scope to invest in Mutual Funds managed by experienced and professional asset management group.

ICICI Bonds : ICICI Bank offers to customers wide range of long term deposit products like Safety Bonds, Tax Saving Infrastructure Bonds, Children Growth Scheme, Pension Bonds and Encash Bonds issued by ICICI through periodic public issues.

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Portfolio Investment Scheme : PINS permits NRIs and OCBs (Overseas Corporate Bodies) to purchase and sell shares and convertible debentures of Indian companies on repatriable or non-repatriable basis.

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DATA ANALYSIS AND ITS INTERPRETATION

1. Economic Status Rationale : The objective of this question was to know about the Economic Status of the respondents that has been covered. Income Category a) 120000-180000 p.a. b) 180000-300000 p.a. c) 300000 p.a. and above
TABLE NO - 6.1

No of Respondent 40 40 20

40 30 No of Respondnt 20 10 0 120000-180000 p.a. 180000-300000 p.a. Income >300000 p.a.

CHART NO 6.1

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It is found from the above information that out of total 100 respondent 40 belongs to income level up 1.80 lacs..40, belongs to income level of up to 3 lacs and only 20 respondent have income more then 3 Lacs.

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Q2. With which bank do you have your account ? Rationale : The purpose of this question was to know with which bank people have their account.. Banks ICICI UTI BOTH TABLE NO 6.2 Percentage 46% 40% 14%

14% 46%
ICICI Bank Bank UTI Bank HDFC Bank Both Both

40%

CHART NO 6.2

It has been revealed in the above analysis that 46 % of the total respondent have their account in ICICI bank ,where as 40 %respondent have their account inUTI bank. Only 14 percent people have account in both the banks Q.3 Are you aware of the various products and services of ICICI/ UTI Banks ?

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Rationale : This question has been designed to know about which ICICI/ UTI Bank products and services are people aware of accounts. Products and services Aware Saving Account Current Account ATM Debit Card Phone Banking
60% 50% 40% 30% 20% 10% 0% Saving Account Current Account ATM Debit Card one Banking

ICICI Unaware 1% 9% 7% 20% 19% Aware 41% 30% 30% 20% 11% 55% 50% 53% 25% 21%

UTI Unaware 3% 11% 10% 35% 49%

TABLE NO 6.4

ICICI Aware ICICI unaware HDFC Aware UTI Aware HDFC unaware UTI Unaware

CHART NO 6.4

It is clear from the above analysis that awareness level among respondents is highest regarding saving account and lowest regarding phone banking services.

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Q4 Are you satisfied with the services offered by ICICI/ UTI banks? Rationale: This question was designed to know whether respondents were satisfied with the services they were getting from the banks in which they already have an account. Respondents Satisfied Unsatisfied ICICI 55% 11% TABLE NO 6.5 UTI 27% 7%

60% 50% 40% 30% 20% 10% 0% ICICI

UTI HDFC

Satisfied Unsatisfied

CHART NO 6.5

It is found in the analysis that out of total respondents 55 percent are satisfied with the services offered by ICICI Bank where as 11 percent are not

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satisfied by services of bank. Moreover 27 percent of

respondent are

satisfied by services of UTI bank where percentage of unsatisfied respondents are 7 percent

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Q.5 Are you aware of their uses and benefits ? Rationale : The objective of this question was to know whether people are aware of the uses and benefits of various products and services of ICICIUTI Banks. Respondents Aware Unaware ICICI 51% 11% TABLE NO 6.6 UTI 20% 18%

60% 50% 40% 30% 20% 10% 0% ICICI

UTI HDFC

Aware Unaware

CHART NO 6.6

It is found in the analysis that out of total respondents 51 percent are aware of uses of the products & services offered by ICICI Bank where as 11

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percent are not aware of services of bank. Moreover 20 percent of respondent are aware of uses of products & services of UTI bank where 18 are not aware of services of bank.

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Q.6 Would you like to avail the facility of withdrawing over and above your Saving Account, upto 75% of Fixed Deposit at a minimal cost ? Rationale : The objective of this question was to know whether people feel super saver facility a cheap way to availing O/D. Respondents Favoured Didnt Favoured ICICI 41% 19% TABLE NO 6.7 UTI 30% 10%

45% 40% 35% 30% 25% 20% 15% 10% 5% 0% ICICI Favoured Didnt Favoured

UTI HDFC

CHART NO 6.7

It is clear from the above analysis that out of total respondents 41 percent & 30 percent favoured this facility of ICICI bank and UTI bank respectively.

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Where as 19 & 10 % respondent of ICICI Bank and UTI Bank did not favoured this facility.

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Q.7 Would you like to avail Home Delivery of Demand Drafts and Subsided interest rates on loans ? Rationale: The need of this question was to know how many would like to avail facility of demand draft and facility of subsidized interest rates on loans. Facilities ICICI Willing Percentage a)Home Delivery of Demand Drafts b)SubsidizedInterest Rates on Loans c) None 25% 28% 3% TABLE NO 6.8 20% 20% 4% UTI Willing Percentage

30% 25% 20% 15% 10% 5% 0% Home deliv ery of D emand Drafts Subsidized interest rates on loans None ICICI Willing percentage HDFC Willing UTI Willing percentage percentage

CHART NO 6.8

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It is clear from the above analysis that willing percentage for home delivery of demad drafts for ICICI Bank & UTI Bank is 25 &20 percent respectivey . moreover 28 & 20 percent of respondent of ICICI Bank & UTI Bank are willing for facility of Subsidized interest rates on loans Whereas 3 & 4 percent respondents of ICICI Bank & UTI Bank are not willing for these facility

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Q.8 Would you like to have Saving Account with additional and attractive features? Rationale :The purpose of this question was to know whether people like the additional facilities that are given with ICICI/ UTI Banks saving a/c. Facilities Willing a) Free ATM Card b) Inter Branch Banking c) Debit Card d) Phone Banking e) Net Banking f) Bill Pay 40% 25% 26% 23% 15% 20% ICICI Not willing 15% 20% 25% 30% 35% 25% Willing 21% 15% 11% 10% 10% 13% UTI Not willing 25% 41% 38% 37% 45% 42%

TABLE NO 6.9
50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%
Free ATM Card Inter branch banking Debit Card Phone Banking Net Banking Bill Pay
ICICI Willing ICICI Not willing HDFC Willing UTI Willing HDFC Not willing UTI Not willing

CHART NO 6.9

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Q.9Are you satisfied with the behaviour of bank staff?

Rationale : The purpose for this question is to know that how bank staff is maintaining the public relation with all its customer .

Facilities Satisfied Not Satisfied

ICICI Bank 34% 15% TABLE NO 6.10

UTI Bank 42% 9%

50% 40% 30% 20% 10% 0%

Satisfied Not Satisfied

ICICI Bank

UTIHDFC Bank Bank

CHART NO 6.10

It is clear from the above analysis that out of total 34 and 42 percent respondents of ICICI Bank and UTI Bank are satisfied with the behaviour of bank staff whereas only 15 and 9 percent of respondents of ICICI Bank and UTI Bank respectively are not satisfied with the behaviour of bank staff

Q.10How would you rate your experice with ICICI/UTI Bank?

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Rationale: The purpose for this question is to k now the perception of people towards both the banks

Rating Very Good Good Average Poor

ICICI Bank 7% 12% 30% 6% TABLE NO 6.11

UTI Bank 5% 13% 23% 4%

40 35 30 25 20 15 10 5 0

UTI BANK ICICI BANK ICICI Bank

HDFC Bank

Very Good

Good

Average

Poor

CHART NO 6.11

It is analyzed that out of total respondent only 7 percent rate as very good, 12 percent rate their experience as good however 30 percent respondents

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gives average rating for ICICI Bank. However analyzed rating for UTI Bank is 5 ,13 and 23 percent respectively

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Q.11Would you recommend ICICI/UTI Bank to Others ?

Rationale : The purpose for this question is to know

inclination of

respondents towards ICICI/UTI Bank based upon their satisfaction level.

NAME OF BANK ICICI Bank UTI Bank

YES 48 41 TABLE NO 6.12

NO 7 4

50 40 30 20 10 0 YES NO

ICICI Bank

UTI Bank HDFC Bank

CHART NO 6.12

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It is clear from the above analysis that out of total respondents 48 are in favour of recommend ICICI Bank to others. Where as 7 respondents are not in favour of recommending ICICI Bank to others. With regard to UTI bank this percentage is 41 & 4 respectively.

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SUGGESTIONS FOR UTI BANK

Limit on ATM regarding withdrawal should be increased. Savings a/c minimum balance requirements should be reduced. More counters should be provided in order to provide quick services to the customers.

Locker services should be provided. Govt. transactions facilities should also be introduced in UTI Bank. O/D Limit on FD should be increased. In view of competition from MNCs like Citibank, HSBC, ABNAMRO, It is suggested that it should provide credit card facility to its customers.

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SUGGESTIONS FOR ICICI BANK

On the basis of our study certain recommendations may be put forward which may improve the image of ICICI Bank.

I. ICICI Bank should decrease its average quarterly balance requirement so that more and more people can open their account in the bank. II. ICICI Bank should increase the limit of amount withdrawal per day through ATM. III. ICICI Bank is not having its branches in many small cities and the people living in that cities cannot avail the services of the bank, so the bank should open its branches in more cities. IV. ICICI Bank should strive to raise the awareness level of the customer for various services. Customer development is the key if the banks want to tap the potential market. V. Though customers are using certain services, but they are not aware about the proper utilization of these services. Proper utilization here means that these services could prove to be even more beneficial if the customers use these services optimally.

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VI. As ATM is the maximum used channel by the customers so ICICI Bank should increase its number of ATMs to avoid crowding. VII. Some service charges of the banks are high comparative to other banks. The bank needs to review its revenue model for the various services. VIII. The customers need to be more aware regarding value-added services being provided by the bank by means of advertising and tele marketing. It can also be achieved by providing some literature regarding the uses and benefits of the services. IX. The charges of the lockers are high as compared to other private banks. X. ICICI Bank should decrease the average quarterly balance requirement for Quantum Optima so that more and more people could avail the product. XI. Bank should accept the small denomination currency notes from customers.

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