sip final 2012-2013
TRANSCRIPT
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Liberalization and de-regulation process started in 1991-92 has made a sea change in
the banking system. From a totally regulated environment, we have gradually moved
into a market driven competitive system. Our move towards global benchmarks has
been, by and large, calibrated and regulator driven. The pace of changes gained
momentum in the last few years. Globalization would gain greater speed in the coming
years particularly on account of expected opening up of financial services under WTO.
Four trends change the banking industry world over, viz. 1) Consolidation of players
through mergers and acquisitions, 2) Globalisation of operations, 3) Development of
new technology and 4) Universalisation of banking. With technology acting as a
catalyst, we expect to see great changes in the banking scene in the coming years.TheCommittee has attempted to visualize the financial world 5-10 years from now. The
picture that emerged is somewhat as discussed below. It entails emergence of an
integrated and diversified financial system. The move towards universal banking has
already begun. This will gather further momentum bringing non-banking financial
institutions also, into an integrated financial system.
The traditional banking functions would give way to a system geared to meet all thefinancial needs of the customer. We could see emergence of highly varied financial
products, which are tailored to meet specific needs of the customers in the retail as well
as corporate segments. The advent of new technologies could see the emergence of
new financial players doing financial intermediation. For example, we could see utility
service providers offering say, bill payment services or supermarkets or retailers doing
basic lending operations. The conventional definition of banking might undergo
changes.
The competitive environment in the banking sector is likely to result in individual
players working out differentiated strategies based on their strengths and market
niches. For example, some players might emerge as specialists in mortgage products,
credit cards etc. whereas some could choose to concentrate on particular segments of
business system, while outsourcing all other functions. Some other banks may
concentrate on SME segments or high net worth individuals by providing specially
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tailored services beyond traditional banking offerings to satisfy the needs of customers
they understand better than a more generalist competitor.
International trade is an area where Indias presence is expected to show appreciable
increase. Presently, Indian share in the global trade is just about 0.8%. The long term
projections for growth in international trade is placed at an average of 6% per annum.
With the growth in IT sector and other IT Enabled Services, there is tremendous
potential for business opportunities. Keeping in view the GDP growth forecast under
India Vision 2020, Indian exports can be expected to grow at a sustainable rate of 15%
per annum in the period ending with 2010. This again will offer enormous scope to
Banks in India to increase their forex business and international presence.
Globalization would provide opportunities for Indian corporate entities to expand their
business in other countries. Banks in India wanting to increase their international
presence could naturally be expected to follow these corporates and other trade flows
in and out of India.
Retail lending will receive greater focus. Banks would compete with one another toprovide full range of financial services to this segment. Banks would use multiple
delivery channels to suit the requirements and tastes of customers. While some
customers might value relationship banking (conventional branch banking), others might
prefer convenience banking (e-banking).
One of the concerns is quality of bank lending. Most significant challenge before banks
is the maintenance of rigorous credit standards, especially in an environment ofincreased competition for new and existing clients. Experience has shown us that the
worst loans are often made in the best of times. Compensation through trading gains is
not going to support the banks forever. Large-scale efforts are needed to upgrade skills
in credit risk measuring, controlling and monitoring as also revamp operating
procedures. Credit evaluation may have to shift from cash flow based analysis to
borrower account behaviour, so that the state of readiness of Indian banks for Basle II
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regime improves. Corporate lending is already undergoing changes. The emphasis in
future would be towards more of fee based services rather than lending operations.
Banks will compete with each other to provide value added services to their
customers.Structure and ownership pattern would undergo changes. There would be
greater presence of international players in the Indian financial system. Similarly, some
of the Indian banks would become global players. Government is taking steps to reduce
its holdings in Public sector banks to 33%. However the indications are that their PSB
character may still be retained.Mergers and acquisitions would gather momentum as
managements will strive to meet the expectations of stakeholders. This could see the
emergence of 4-5 world class Indian Banks. As Banks seek niche areas, we could seeemergence of some national banks of global scale and a number of regional
players.Corporate governance in banks and financial institutions would assume greater
importance in the coming years and this will be reflected in the composition of the
Boards of Banks.Concept of social lending would undergo a change. Rather than being
seen as directed lending such lending would be business driven. With SME sector
expected to play a greater role in the economy, Banks will give greater overall focus in
this area. Changes could be expected in the delivery channels used for lending to small
borrowers and agriculturalists and unorganized sectors (micro credit). Use of
intermediaries or franchise agents could emerge as means to reduce transaction
costs.Technology as an enabler is separately discussed in the report. It would not be
out of place, however, to state that most of the changes in the landscape of financial
sector discussed above would be technology driven. In the ultimate analysis, successful
institutions will be those which continue to leverage the advancements in technology in
re-engineering processes and delivery modes and offering state-of-the-art products and
services providing complete financial solutions for different types of customers.HumanResources Development would be another key factor defining the characteristics of a
successful banking institution. Employing and retaining skilled workers and specialists,
re-training the existing workforce and promoting a culture of continuous learning would
be a challenge for the banking institutions.
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1.1. TECHNOLOGY IN BANKING
Technology will bring fundamental shift in the functioning of banks. It would not onlyhelp them bring improvements in their internal functioning but also enable them to
provide better customer service. Technology will break all boundaries and encourage
cross border banking business. Banks would have to undertake extensive Business
Process Re-Engineering and tackle issues like a) how best to deliver products and
services to customers b) designing an appropriate organizational model to fully capture
the benefits of technology and business process changes brought about. c) how to
exploit technology for deriving economies of scale and how to create cost efficiencies,
and d) how to create a customer - centric operation model.
Entry of ATMs has changed the profile of front offices in bank branches. Customers no
longer need to visit branches for their day to day banking transactions like cash
deposits, withdrawals, cheque collection, balance enquiry etc. E-banking and Internet
banking have opened new avenues in convenience banking. Internet banking has
also led to reduction in transaction costs for banks to about a tenth of branch banking.
Technology solutions would make flow of information much faster, more accurate andenable quicker analysis of data received. This would make the decision making
process faster and more efficient. For the Banks, this would also enable development of
appraisal and monitoring tools which would make credit management much more
effective. The result would be a definite reduction in transaction costs, the benefits of
which would be shared between banks and customers.
While application of technology would help banks reduce their operating costs in the
long run, the initial investments would be sizeable. IT spent by banking and financialservices industry in USA is approximately 7% of the revenue as against around 1% by
Indian Banks. With greater use of technology solutions, we expect IT spending of
Indian banking system to go up significantly.
One area where the banking system can reduce the investment costs in technology
applications is by sharing of facilities. We are already seeing banks coming together to
share ATM Networks. Similarly, in the coming years, we expect to see banks and FIs
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1.2. Growth rate of indust
Given below is the Money
we have assigned colour c
companies, as Green (Ver
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encompass an entire busin
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TABLE 1
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or bank was also
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significantly higher than th
indicates the asset quality
ratio was also very high for
In conclusion, we could sa
different kinds of players in
have to face relatively mor
After looking at industry pe
Industry have performed in
TABLE 2
Kotak Mahindra Bank has
currently, it also has the hi
lowest net NPA to net adva
other hand, Indias largest
Currently, it has the highes
t of private and foreign banks at the end
f public banks is comparatively poor. Th
private and foreign bank as compared t
that the current position of ROA, Net N
the industry indicates that going ahead,
problems as compared to private and f
formance, lets see how the different pla
the last five years
eported the highest 5-year average net i
hest CAR whereas HDFC Bank has the
nces ratio and the highest five-year-aver
ank, SBI reported the lowest five-year-a
net NPA to net advances ratio and the l
of FY11, which
e Capital Adequacy
public banks.
A and CAR of
public banks will
reign banks.
ers in the Banking
terest margin and
highest CASA, the
age ROA. On the
verage ROA.
owest CAR.
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Bank of Baroda:
Bank of Baroda offers specially-designed car loans for the customers so that it meets
their demands, status and taste. Loans are offered for new as well as used cars. Bank
of Baroda also offers a unique facility for installation of CNG/LPG Gas-kit in the cars.
Unique features and low interest rates are USPs of Bank of Baroda car loans.
Punjab National Bank:
Punjab National Bank, a renowned leader in the field of auto finance market in India,
offers auto loan for new as well as old vehicles of not older than 3 years. Loans are also
offered for purchase of vehicles of foreign/indigenous makes. In September 2009, PNB
tied up with Mahindra and Mahindra for financing their vehicles across the nation.
Kotak Mahindra Prime Limited (KMPL):
Kotak Car Finance has crafted a niche in the Indian auto finance market through its
flexible schemes, hassle-free documentation and quick processing. KMPL finances new
as well as used cars.
Sundaram Auto Finance :
Sundaram Auto Finance is one of the market leaders in the auto finance market in India.
Founded in 1998, this company extends finance in all models of cars. Customers can
choose from a range of vehicle and finance packages offered by the company. It also
has an extensive network of more than 400 branches across the nation.
United Bank of India:
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United Bank of India is one of the leading auto finance companies in India offering
range of car financing options to the customers. It offers car loan for new cars as well as
for used cars.
Canara Bank:
Canara Bank offers attractive interest in the auto loans for its customers. From August
2009, Canara Bank further reduced its auto loan rates to woo customers. Canara
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2.1. HDFC BANK:
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 liberalisation of the Indian Banking
Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC
Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995.
2.2. MISSION and VISION:
Our mission is to be "a World Class Indian Bank", benchmarking ourselves against
international standards and best practices in terms of product 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. We are committed
to do this while ensuring the highest levels of ethical standards, professional integrity,
corporate governance and regulatory compliance.
2.3. Business strategy emphasizes the following :
Increase our 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.
Leverage our technology platform and open scaleable systems to deliver more products
to more customers and to control operating costs. Maintain our current high standards
for asset quality through disciplined credit risk management.Develop innovativeproducts and services that attract our targeted customers and address inefficiencies in
the Indian financial sector.
Continue to develop products and services that reduce our cost of funds. Focus on high
earnings growth with low volatility.
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Retail banking services:
HDFC Bank was the first bank in India to launch an International Debit Card inassociation with VISA (Visa Electron) and issues the Mastercard Maestro debit card as
well. The Bank launched its credit card business in late 2001. By March 2009, the bank
had a total card base (debit and credit cards) of over 13 million. The Bank is also one of
the leading players in the merchant acquiring business with over 70,000 Point-of-sale
(POS) terminals for debit / credit cards acceptance at merchant establishments. The
Bank is positioned in various net based B2C opportunities including a wide range of
internet banking services for Fixed Deposits, Loans, Bill Payments, etc.With Finest of
Technology and Best of Man power in Banking Industry HDFC BANK's retail services
have become by and large the best in India and since the contribution to CASAi,e total
number of current and savings account of more than 50% ,HDFC BANK has full
potential to become Indias No.1 Private Sector Bank.
Treasury:
Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. Theseservices are provided through the bank's Treasury team. To comply with statutory
reserve requirements, the bank is required to hold 25% of its deposits in government
securities. The Treasury business is responsible for managing the returns and market
risk on this investment portfolio.
2.6. Distribution network:
HDFC Bank is headquartered in Mumbai and has a As of March 31, 2012, the Banks
distribution network was at 2,544 branches and 8,913 ATMs in 1,399 cities as against
1,986 branches and 5,471 ATMs in 996 cities as of March 31, 2011.
PARTICULARS Mar09 Mar10 Mar11 Mar12
Cities 528 779 996 1399
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Branches 1412 1725 1986 2544
ATMS 3295 4232 5471 8913
TABLE 3
HDFC has achieved a lot in past year because of that its rewarded by media and world
also.. This are some awards hdfc has got. Like: Business Today-Monitor Group survey-
One of India's "Most Innovative Companies , Business Today - 'Best Bank' Award , Dun
& Bradstreet American Express Corporate Best Bank Award 2007 - 'Corporate Best
Bank' Award , The Asian Banker Excellence in Retail Financial Services Awards - Best
Retail Bank in India
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Cross-selling stands for being able to offer to the existing bank customers, some
additional banking products, with a view to expand banking business, reduce the per
customer cost of operations and provide more satisfaction and value to the customer.
For instance, when a bank is in a position to sell to a deposit customer (say saving bank
or term deposit), a loan product such as housing loan, credit card, personal loan or vice-
versa, this would result into additional business and lead to low per customer cost and
higher per customer earning.
Revived focus : In the present day context, the cross selling has come into focus, as
some of the new private banks (ICICI Bank) have been able to offer to their customer a
variety of products and thus generate more business through cross selling. But for most
of the public sector banks, in particular, the concept in its new form, is still at its
evolutionary stage.
Scope of cross selling : The crossing selling may take place on the liability side (i.e.
different kinds of deposit accounts) or on the asset side (i.e. loans for different
requirements) or between the two. It could be either at the initiative of the customers or
a bank can implement it as a well prepared strategy.
Benefits from cross selling : The major benefit is in terms of cost reduction as for a
bank, the cost of contracting a new customer is much higher than to serve an existing
customer (may be up to 3-4 times). Further, through cross selling the benefits of
economies are available to the bank, which reduce the cost further and increase the
profits. Another additional advantage is that the cross selling helps in building brand
value if the loyalty of the customer could be ensured for the brand, as in that case the
likelihood of shifting the business dealings to another organisation/bank by the
customer, is much less.
Strategies for cross selling: The existing client base of the banks could be used by them
for the purpose of cross selling after carefully charting the profile of the customers. For
this purpose, the banks can undertake studies for various products and various
geographical areas to understand the potential available for cross selling. The banks
may undertake some of the following steps:
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Collection of data and preparation of data base of the customers, because the entire
exercise of cross selling is based on such data base of the customers.
Identification of customers and products that could be offered and then charting the
strategy to offer the products.
Imparting proper training to the staff to create team spirit and sharing with them the
strategy for undertaking cross selling.
Selecting target customers and narrowing down the product range, or even
development of new products if necessary, to meet the specific needs of the group.
Effective delivery.
The bankers have to remember that Cross-selling is not a transaction based activity, it
is primarily, a relationship building exercise.
Cross selling is a way of offering a customer a product which is complimentary to the
initial product they are buying. For example, if a person is buying a flashlight, a
salesperson may ask them, "Would you like batteries to go with that?" Its really a way
of helping customers; after all, there is nothing worse than arriving home with a product
and finding that it doesnt work because you did not purchase all the necessary
components.
3.1. Up Selling:
Up selling is slightly different from cross selling because it is about upgrading a product
or selling them a premium version of the product. When you go to a restaurant for
example, the customer may say, "Ill have a martini, strait up." The server may then ask,
"Do you have a preference on the gin? We carry Bombay and Beefeaters." The
customer says, "Beefeaters, please." It seems like a casual question, but for the owner
of the restaurant this type of cross-selling is essential to their bottom line. Instead of just
taking the drink order, the server offered more expensive liquor. A good server always
offers something a little nicer and little bit more expensive. Not only does it move
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product and help the customer know what is on offer, but it enables the waiter to sell
more, and get a higher tip.
Every customer is a potential target for cross selling. Every time a customer decides to
make a purchase they are providing the seller with important information about what
products and services appeal to them. When a customer decides to spend their money
at a particular store, the seller knows that they have already agreed that they like the
product or service enough to spend money on it. There has been no persuasion, or hard
sell, the customer has already agreed to pay the price, all the sales person, or
marketing department needs to do, is to cross sell them with products or services they
may not even know existed. For example, "Have you seen the special doll that goes
with that dolls house?" Or, "A lady came in yesterday and bought the companion book
that goes along with that, would you like to see it?" When cross selling is considered as
an added value component, it never seems so much like selling, its just another way of
being helpful and letting the customer know what is available in a range of products or
services that they already like.(16th July 16, 2012) http://crossselling.org/
3.2. Examples for Cross-Selling
1.Cross-Selling offline:
Cross-selling is an effective tool in both the online and offline-world. In certain cases,
the customer doesnt have any idea that they are the recipient of cross-selling; they are
simply being asked a question that will enhance their experience. Perhaps the chain
restaurant, McDonalds is one of the forerunners and best known off-line examples of
cross-selling and they employ it all the time. By selling complimentary products, they are
substantially increasing their bottom line, and in certain cases the customers
experience. Whenever a person working on the drive-through asks a customer if they
want to super-size their order, or if they want an extra hash brown for thirty cents, they
are being cross-sold an additional product. When someone at the counter is being
asked if they want an additional product, "Would you like a meal deal to go with your
quarter pounder?" Or, "would like that super-sized?" Or, "Do you want a drink with
that?" Thats cross-selling in its most basic and unrefined form.
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Cross-Selling onlineOn the internet, cross-selling is an obvious winner. It is the practice of promoting
complementary items related to the item that has just been bought. One of the first to
use cross-selling to enhance their services, retain customers, attract new customers
and stay competitive. If you purchase a certain type of product, whether it is a book or
CD, you will see a notification either at check-out or via email, to tell you that other
customers, who bought this product, also enjoyed this very similar product. As soon as
you purchase a certain type of business book, you will be notified of other similar books
that are available. Amazons cross-selling methods are highly effective and provide
additional value to customers whilst at the same time, increasing the sites sales
volume.
Ebay is another on-line site that promotes cross-selling. For example, if you are selling
bath towels and also have bathroom accessories in your Ebay store, it would be a
natural fit for a cross-selling opportunity. It makes sense, because it doubles the
revenue on what would have been a single sale.
Whether it is on-line sales or off-line sales, cross-selling is made easy by displaying
similar items together. Just think of it like a department store, items are placed side by
side based on certain criteria. Begin with a best selling item, one that is already a
proven success, and then look for similar or related items that you can bundle together.
On-line success can be gained by using the shopping cart platform. This is an
automated cross-selling process and can be simply worded, "Customers, who bought
this stemware, also purchased this wine." There is something about recommendations
that help people to make a purchase; even when its a stranger, or someone they will
never meet. If they have bought the same product that you have just bought, they
automatically seem to be on your same wave length. And so, if they also bought this
similar product, then it makes sense that you would like that too.it being established
that you are already both of the same mind.(16th july) crosselling.org
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3.3. Cross Selling Strategies
While there are many strategies for cross-selling, some of the main ones as far as off-line sales are concerned is the communication process between employees and
customers. First, customers must feel at ease and a rapport established as quickly as
possible. Greeting, shaking hands, introductions and eye-contact are important steps to
making the customer feel at ease. Open ended questions also help lead to further
discussions that can open opportunities for a cross-sale.
Product knowledge is also a key factor in cross-selling. For example, the customer may
not know that a particular product has a variety of accessories that would help with theirproject; and while it may be too hopeful to consider a garden shed to house a
lawnmower purchase, its not out of the question to talk about it, and ask the relevant
questions that may lead to another cross-sale.
Risks and chances
With every selling strategy, there are risks and chances to be taken. If cross-selling isused incorrectly, it can damage your credibility and even sabotage your efforts in
marketing. The obvious ones are by overloading a customer with something he or she
does not want. For example, in a fast food restaurant, to continue asking if the customer
wants additional food, when they are obviously not interested is a definite risk. The
customer may feel turned off by what seems like an interrogation; they may even turn to
other fast food restaurants in the neighborhood as a result. If a customer is deluged with
too many items that other customers liked and bought this can also be a big turn off.
Cross-selling must appear to be as natural as breathing fresh air. A simple question that
the customer can either say, "yes" or "no" and then move on.
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behind cross-selling is defeated. As well, some banks forget that the objective was
profitnot a higher cross-sell. Many tactics merely increase cross-sellnot profit.
Offering discounts for additional products and services, but at the cost of forgone
revenue, results in losses.
Banks in the past and some banks in the present also have been traditionally organized
in product silos, with their own marketing and technology support. This has led to a
siloed approach leading to less cross sell. Banks need to understand that it takes a
great deal of time, effort and teamwork to successfully cross-sell beyond the traditional
bank product set. Credibility and motivation are very important aspect here. The person
interacting with the Clients needs to have an expertise on the subject and help the client
in understanding and getting the right product.
Cross-selling comes with its advantages, of course. It considerably reduces customer
acquisition costs, servicing, and marketing and communication costs and thereby
substantially increases spread for banks. It is well understood and key finding that
greater the number of products held by customer leads to an increased probability of
retention.
3.5. Tools Enablement
Successful cross-selling requires that banks understand what their customers need and
that the bank keep track of their interaction via phone banking, web, walk in, etc. Just
making phone calls to sell loans or plastic cards that the customer does not desire may
often end up annoying him. Analysing the customer database and then putting the right
customer relationship management strategies in place is essential to ensure that the
cross-selling effort does not backfire. Customers also would not like their data to beused by Banks to merely send them mailers of no interest to them. They will, however,
appreciate a bank that does not try to sell them the same product again and again. It's
also important to keep track of interactions across channels. If the customer declines an
offer at the call center, there's no point in offering the same product when he or she
visits the banks Web site. That would be the equivalent of telling them that they are data
and not an individual.
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Based on the market size the tools required to target customers also matters. For large
Banks with large number of customers, CRM, referral tracking, profitability analytics,
easy-to-use referral and sales-call tracking systems; complete activity management,
scalable and flexible agency management systems, information support systems are
required. Along with the systems/tools effective training gives customer service and
sales representatives the knowledge they need to better meet customers' needs and to
utilize the tools that management has invested in.
3.6. Training, Incentives and People
Having tools and systems to cross sell does not end the process of selling. Getting theemployees involved in this exercise and motivating them to sell is an important aspect.
It is important for the Bank to provide rewards for the cross-sale or referral that are
commensurate with the profitability of the product or service to the bank. It also makes
sense to involve the staff in coming out with innovative campaigns and also ideas which
will stimulate them to sell newer products. As banking products tend to get very
complex, helping the employee understand the complexities of the product, rules and
regulations and compliance issues if any need to be educated. Help in identifying a
prospect and handing over the lead to a qualified lead for closure is also important.
Constant coaching in helping them to understand customer's needs, wants and goals
along with dealing in an emotive, emphatic and interactive manner is imperative. Linking
cross sell to be a part of an employee's performance appraisal along with non cash
recognition and cash awards are some of the initiatives taken for employee
engagement.
The more relationships a bank has with a customer, the more loyal the customer will be
and the bank gets to know the customer through several relationships, thus the
assessment of the credit quality of the customer can be bettered. At the end it will be a
win-win situation for both the bank and customer as it is cheaper and easier to get
customer from ones own data base than going out for getting new customers. Banks
should be careful in exploiting this situation and see that the bottom line along with the
top line goes up and not just cross sell of products.
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3.7. Ideas for Cross Selling Success :
Many early stage businesses that offer more than one product or service can do a much
better job of educating customers on the different solutions they deliver. This type of
cross selling can be a highly effective tool for a small business.
When you cross-sell, you offer the customer a product or service related to whatever
they are already buying. It can be as simple as the waiter asking if you want a salad to
go with your main course. Up-selling positions higher priced products in a
good/better/best progression. Both methods of encouraging clients to spend a little
more can dramatically boost your sales.
But maybe you worry about irritating them with too many sales pitches to buy more.
Dont. Surveys show that most buyers appreciate being told about additional products or
services that might better meet their needs or about new items that were not offered in
the past. Its a way of demonstrating that you are aware of their needs and care about
their satisfaction. Here are some ideas to help you improve your cross selling success:
3.8. Ideas to improve your opportunities for cross-selling and up-selling
Let nature take its course. Many cross-selling opportunities arise naturally. If you are
selling tennis racquets, for example, you can also offer a bag, balls, lessons and
accessories. To gain the extra sale, you might simply have to mention that the other
products or services are available.
Stay relevant. If you overload customers with too many unrelated cross-selling
suggestions, you may blow it. Offering socks with shoes is certainly a good fit. But if
your attempts to cross-sell are not closely related to the original purchase, they are far
less likely to succeed.
Post expert recommendations. One way to facilitate cross-selling and up-selling
success is to state specific recommendations from professionals, experts or other
customers. This could be a chefs recommendation on a menu, a doctors
recommendation on a mailer, or lists of related items that other customers have
purchased on a website. When you buy a book at Amazon.com, for example, the site
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automatically lists other books purchased by people who bought the same book you just
ordered.
Train employees in cross-selling techniques. The approach must be built around
serving the customer, not just selling more stuff. For example, you might describe how
the additional products or services would complement the original purchase and further
solve the customers problem.
Timing is important. Cross-selling and up-selling can occur at different times,
depending on the products and services you are selling. In some cases, the best time is
while a customer is trying something out. If they are looking at a low priced digitalcamera, for example, but seem disappointed in a lack of features or performance, they
may really want a higher priced model. Or you could suggest a belt to go with a pair of
pants while the customer is trying them on. Other items are more appropriately offered
once the initial buying decision has been made, such as an extended warranty.
Leverage the cross-selling potential of your website. Position cross-sell and up-sell
items throughout your site in places where they can help educate shoppers on the
depth and variety of what your business offers. Try mixing and matching different itemsto see what works best.
Offer a range of prices. If you suggest three items to complement a product, try to offer
a mix of price points. The lowest cost items are most likely to be picked up as impulse
buys. But other items that meet the customers needs can also sell at higher levels.
Try product or service bundles. Bundling has long been used as a way to entice
shoppers to buy not just a single item, but an entire group of items that go together.
Offering a price break on package deals will help close the sale.
Our Bottom Line:
The key to successful cross-selling and up-selling is to focus your efforts on meeting the
customers needs, rather than simply pushing more products and services. This is one
area of startup marketing where you may need to do a little experimentation in order to
find just the right balance, but you need to make cross selling a key component of your
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list of sales techniques.
3.9 The following are the cross selling products for HDFC bank
1. Accounts and deposits:
A deposit account is a current account, savings account, or other type of bank account,
at abanking institution that allows money to be deposited and withdrawn by the account
holder. These transactions are recorded on the bank's books, and the resulting balance
is recorded as a liabilityfor the bank, and represent the amount owed by the bank to the
customer. Some banks charge a fee for this service, while others may pay the customer
interest on the funds deposited.
1.1. Savings Accounts:Savings accounts are accounts maintained by retail financial
institutions that pay interest but cannot be used directly as money in the narrow
sense of a medium of exchange (for example, by writing a check). These
accounts let customers set aside a portion of their liquid assets while earning a
monetary return. For the bank, money in a savings account may not be callableimmediately and therefore often does not incur a reserve requirement freeing up
cash from the bank's vault to be lent out with interest.
1.2. Salary Accounts:A salary bank account or a salary account as it is more
commonly called, is nothing but a regular bank account but one in which your
employer will credit your monthly salary/paycheck every month. If you have a
salary account with a bank, banks usually provide you with additional facilities
like 0 balance account, credit cards, overdraft facilities etc.
1.3. CurrentAccounts:Current account can be opened in co-operative bank and
commercial bank. Incurrent account, amount can be deposited and withdrawn at
any time without giving any notice. It is also suitable for making payments to
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2. LOANS:A loan is a type of debt. Like all debt instruments, a loan entails the
redistribution of financial assets over time, between the lender and the borrower.In a
loan, the borrower initially receives or borrows an amount of money, called the
principal, from the lender, and is obligated to pay back or repay an equal amount of
money to the lender at a later time. Typically, the money is paid back in regular
installments, or partial repayments; in anannuity, each installment is the same
amount
2.1. Personal loan:
A personal loan is a short-term loan to assist you with your finances. This payday
loan is secured against a future paycheck. These loans have become quite popular
today, and now this is the main way to get financial assistance in the form of a cash
advance.
A personal loan is a type of debt which is made for personal, family, or household use,
and which is neither a business loan nor a long-term mortgage loan. The lender loans
money to the borrowers. The borrowers pay back this amount, usually but not always in
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regular installments. This service is generally provided at a cost, which is referred to as
interest on the debt.
With a personal loan one can meet his financial requirements. Be it any ceremony in the
family, a surprise gift or a grand vacation, personal loans provide a helping hand. The
personal loan helps to take care of all kinds of expenses in a short time period. This
type of loan usually covers travel expenses, holiday expenses, medical expenses,
marriage expenses, honeymoon expenses or any other personal type expenses.
There are basically Two Types of Personal Loans. They are:
A. Secured Loan B. Unsecured Loan
2.1.1. Secured Loan :
Wherein the loan involves the attachment of collateral say, your property or any
fixed/movable asset- against the sum of money borrowed. You risk losing your home
should you default on repayments.examples like Home Loan, Car Loans, Two Wheeler
Loans, Loans Against Assets
2.1.2. Unsecured Loan : Here the loan is not secured against the loan amount
borrowed. But consequently the lender would be charging a higher rate of interest,
taking into account the high risk involved in lending the sum. Here, failure to make
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regular payments would see the lender fall back on the credit agreement, and resort to
legal claims to make good the loss incurred.
3. Cards:
3.1.1 Credit Cards : A credit card is a payment card issued to users as a system of
payment. It allows the cardholder to pay for goods and services based on the holder's
promise to pay for them. The issuer of the card creates a revolving account and grants
a line of credit to the consumer (or the user) from which the user can borrow money forpayment to a merchant or as a cash advance to the user.
3.1.2 Debit Cards : A debit card (also known as a bank card or check card) is a plastic
card that provides the cardholder electronic access to his or her bank account(s) at a
financial institution. Some cards have a stored value with which a payment is made,
while most relay a message to the cardholder's bank to withdraw funds from a
designated account in favor of the payee's designated bank account. The card can be
used as an alternative payment method to cash when making purchases. In some
cases, the primary account number is assigned exclusively for use on the Internet and
there is no physical card.[1][2]
In many countries, the use of debit cards has become so widespread that their volume
has overtaken or entirely replaced cheques and, in some instances, cash transactions.
The development of debit cards, unlike credit cards and charge cards, has generally
been country specific resulting in a number of different systems around the world, which
were often incompatible. Since the mid 2000s, a number of initiatives have allowed
debit cards issued in one country to be used in other countries and allowed their use for
internet and phone purchases.
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4. Investments:
4.1. Wealth Services: Wealth management is an investment advisory discipline
that incorporates financial planning, investment portfolio management and a
number of aggregated financial services. High Net worth Individuals (HNWIs),
small business owners and families who desire the assistance of a
credentialed financial advisory specialist call upon wealth managers to
coordinate retail banking, estate planning, legal resources, tax professionals
and investment management. Wealth managers can be an independent
Certified Financial Planner, MBAs, Chartered Strategic Wealth Professional,
CFA Charterholders or any credentialed professional money manager who
works to enhance the income, growth and tax favored treatment of long-term
investors. Wealth management is often referred to as a high-level form of
private banking for the especially affluent. One must already have
accumulated a significant amount of wealth for wealth management strategies
to be effective.
4.2. Insurance:
4.2.1. life Insurance: Life insurance is a contract between an insurance policy
holder and an insurer, where the insurer promises to pay a designated
beneficiary a sum of money (the "benefits") upon the death of the insured
person. Depending on the contract, other events such as terminal illness or
critical illness may also trigger payment. The policy holder typically pays a
premium, either regularly or as a lump sum. Other expenses (such as funeral
expenses) are also sometimes included in the premium.The advantage for
the policy owner is "peace of mind", in knowing that the death of the insured
person will not result in financial hardship for loved ones.Life policies are legal
contracts and the terms of the contract describe the limitations of the insured
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sustained from things other than traffic collisions.
4.2.4. Travel Insurance: Travel insurance is insurance that is intended to cover
medical expenses, financial default of travel suppliers, and other losses
incurred while traveling, either within one's own country, or internationally.
Temporary travel insurance can usually be arranged at the time of the
booking of a trip to cover exactly the duration of that trip, or a "multi-trip"
policy can cover an unlimited number of trips within a set time frame.
4.2.5. Home Insurance:
The home insurance policy is usually a term contracta contract that is in
effect for a fixed period of time. The payment the insured makes to the insurer
is called the premium. The insured must pay the insurer the premium each
term. Most insurers charge a lower premium if it appears less likely the home
will be damaged or destroyed: for example, if the house is situated next to a
fire station or is equipped with fire sprinklers and fire alarms; if the house
exhibits wind mitigation measures, such as hurricane shutters; or if the house
has a security system and has insurer-approved locks installed.
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3.10 Auto loan
Gone are the days when people would dip into their cash reserves and savings to buycars. Almost all both individuals and companies prefer to buy vehicles on
installments, because that allows them the liberty of not having to invest a huge amount
upfront. Thats the need gap being filled by almost all banks and financial institutions,
who now offer auto loans on lucrative terms to consumers, egging them to fulfill their
dreams and aspirations, just by paying some extra interest. According to industry
estimates, in the last few years alone, 60% of cars were bought through finance deals.
Two-wheelers, being cheaper, had a smaller share in the auto loans market.
With more and more attractive car and two wheeler brands and models jostling for the
consumers attention, banks and financial institutions, are also falling over each other to
offer the most customer-friendly loan schemes, which can suit even the most humble
earnings. Thats what creates an embarrassment of riches a confusion over which
bank to choose and which loan to opt for
After buying a house, for many people the second largest and most complicated
financial transactions they will experience is acquiring a car, in make no differencewhether the car is new, used, budget, luxury, very basic, or loaded with options. Despite
the lesser amount of money involved in buying a car as opposed to buying a house, the
considerations are just as many and can be just as complicatedin fact in a certain
sense buying a car can be more difficult to understand due to the unique nature of
vehicles being both expensive and yet poor holders of investment value.
Let us assume for the moment that, given your unique situation in terms of factors
like your income, how you use your car, your age, and your credit history, you havealready gone through some of your options and you are sure of two things: you want to
buy rather than lease your vehicle, but you can not afford to pay cash so you need a
loan; and your situation leaves open the possibility of going for a no-money-down loan
or a traditional 20%-down loan. Is this situation the only question that really matters is,
Is it more or less beneficial for me over the life of this vehicle if I put a 20% down
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Bank of
Maharashtra
3 years 10% 11.25 Rs 2000/-
Canara Bank 3 years 10% 11.0 0.1% on the loan amount
with a minimum of
Rs.250/- and maximum
of Rs.500/-
Catholic Syrian
Bank
3 years 20% 14.25 0.25% of loan amount,
minimum Rs 250
Central Bank of
India
3 years 15% 10.0 1%
City Union Bank 3 years 10% 13.5 1% of loan amount
Corporation
Bank
3 years 15% 10.5 1% of loan amount or
min Rs 1000
Dena Bank 3 years 20% 11.0 Rs 500
Dhanalakshmi
Bank Ltd
3 years 25% 13.5 0.5% of loan amount
Federal Bank 3 years 10% 12.0 NA
HDFC Bank 3 years 0% 12.75-
12.25
NA
ICICI Bank 3 years 5% 14.25 NA
Indian Bank 3 years 10% 11.75 Rs 250 per lakh or part
thereof
Indian Overseas
Bank
3 years 10% 12.0 upto Rs. 2 lakh- Rs.
134/-, above Rs. 2 lakh-
Rs. 134/- per Rs. 1 lakh
J&K Bank 3 years 10%-20% 12.0 0.25% of loan amount,
min Rs 500
Karnataka Bank 3 years NA 13.0 0.25% of loan amount
Karur Vysya
Bank
3 years 20% 12.0 0.3% of loan amount
Lakshmi Vilas 3 years 20% 14.25 1% of the loan amount
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lakh whichever
is lower
Union Bank of
India
3 years 20% 11.0 Rs 500 - Rs 1000
United Bank of
India
3 years 10% 12.0 0.50% of loan amount
Vijaya Bank 3 years 20% 11.25 NA
TABLE 5
3.11. CAR LOAN PROCESS
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Car loan process:
SOURCES OF AVAILING
Bank basically has its own
helps its to pull business. T
and it helps it to reach larg
COLLECTING DOCUMEN
Availing the consumers is f
important is collecting docu
role in this whole process.
DEAPPROVE/PE
C.
COLLECTING DOC
S
ONSUMERS:
channels through which it generates its
here are some direct channels and som
number of consumert
S AND REQUIRED PAPER FROM CO
irst and basic step but then more importa
ments and required papers from the the
ollowing are the documents required for
DISBURSEMENT
ISION MAKERS (CREDIT MANAGER)DING REJ
DETAIL DATA ENTRY
FIELD INVESTIGATION (F.I)
QUICK DATA ENTRY(Q.D.E)
.A (CENTRAL PROCESSING AGENCY)
UMNETS AND REQUIRED PAPERS FRO
OURCES OF AVAILING CONSUMERS
usiness and which
Indirect channels
SUMERS:
ntly what is
which play a vital
the same
CT
CONSUMER.
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Statement of
Past 6 Months
.
Statements
not necessary
ICICI Application
Form,
Photograph,
Identity Proof,
Residence
Proof, Income
Tax Return ofLast 2 Years,
Bank
Statement of
Past 6
Months.
Application
Form,
Photograph,
Identity Proof,
Residence
Proof, Latest
Salary Slip,Form 16,
Bank
Statements
not necessary
CITI BANK Application
Form,Photograph,
Identity Proof,
Residence
Proof, Income
Tax Return of
Last 2 Years,
Bank
Statement of
Past 6 Months
Application
Form,Photograph,
Identity Proof,
Residence
Proof, Latest
Salary Slip,
Form 16,
Bank
Statements
not necessary
Oriental Bank
Of Commerce
Application
Form,
Photograph,
Identity Proof,
Application
Form,
Photograph,
Identity Proof,
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TABLE 6
3.12. Credit manager works:
To be a good credit manager you should have a 4 year degree in business
management or finance. This requirement can be waived depending on
the company if there is adequate professional experience. An extensive
knowledge of credit and collections is helpful along with the ability to read
credit reports. The credit manager should have a working knowledge of
the Fair Debt Collection Practices Act which basically guides the activities
of third party debt collectors. Management and supervisory skills are also
needed along with excellent communication skills verbal and written. The
credit manager should have excellent computer skills as well.
Residence
Proof, Income
Tax Return of
Last 2 Years,
Bank
Statement of
Past 6 Months
Residence
Proof, Latest
Salary Slip,
Form 16,
Bank
Statement of
Past 6 Months
Bank Of
Baroda
Application
Form,
Photograph,Identity Proof,
Residence
Proof, Income
Tax Return of
Last 2 Years,
Bank
Statement of
Past 6 Months
Application
Form,
Photograph,Identity Proof,
Residence
Proof, Latest
Salary Slip,
Form 16,
Bank
Statement of
Past 6 Months
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Credit managers oversee the credit policies and procedures of an entire
department within an organization. The make sure credit procedures are
adhered to during the course of operations. Companies extend credit to
their customers and clients in an effort to increase sales. If a company has
large ticket items which can cost a substantial amount of money
sometimes customers are not able to pay cash therefore credit is needed.
Credit gives customers of an organization the purchasing power they need
to purchase the goods and services to make sure their needs are
satisfied.
If a company does not have the means available that enable customers tomake large purchases then they will lose customers to competitors and
sales. Customers can pay by cash or credit. If the credit department has a
high rate of delinquency then they are probably too lenient when it comes
to extending credit. Management will then tighten the reins to make sure
they are not extending credit to customers who should not be approved.
On the other hand if they have a very low rate of delinquency then they
may not be approving enough customers and the bottom line is they are
missing some good opportunities for sales. In order to run a credit
department one has to balance sales with losses, therefore balance is
needed in order for the department to run effectively and efficiently while
at the same time maximizing profit opportunities.
In order for a company to determine if a potential customer should have
credit the credit manager will take a look at several categories. The first
category is Ability to Pay. Does the customer have the income which
would enable them to make payments on time? Can the customer afford
this loan? If the customer does not have a sufficient amount of income
there is a chance that their application could be denied. Once a customer
is denied a denial letter is sent out within 30 days explaining why they
were denied. Some customers take this opportunity to explain themselves.
Perhaps they had other income which was not disclosed. If that's the case
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the customer can reapply and present the credit department with the new
information.
The next category looked at is the customers stability. How long has the
customer been living at their address? How long have they been on their
job? Do they rent or are they homeowners? Most credit departments like
to see two years at the residence and two years on the job which shows
stability. Although this policy can vary from company to company and
some feel one year at each place is sufficient. If a potential customer is a
homeowner rather than a renter then they are considered to be more
stable. Companies that use a credit scoring system will most likely viewthis customer as a more promising prospect than the renter and award
them more points within the confines of a scoring system.
The next category is willingness to pay. How has the customer paid their
debts in the past? Are their any delinquent accounts? To answer these
questions a company has only to take a look at the potential customer's
credit report. They will be able to view the customer's entire credit history.
Sometimes a customer may have to explain why he is past due with
certain creditors. If the creditor feels that the explanation is valid and that
the problem leading to the delinquency has been corrected then the
customer may receive credit.
Customers that ultimately don't pay are forwarded on to a collection
agency for further collection activities. Normally this does not happen until
the debtor has not paid for 4 to 9 months. Most companies have different
policies concerning this procedure. When an account is forwarded to a
collection agency it is simultaneously reported to the debtor's credit report
as a bad debt account or as a charge off. This reflects on the debtors file
as a "9" rating which is a derogatory rating and it will seriously impact a
debtor's credit report in a negative way. It remains on file for seven years.
The credit manager will normally have a credit supervisor and a
collections supervisor who answer to him. The credit manager will
normally supervise the credit correspondents or the credit analysts within
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the department. They are responsible for taking credit applications from
customers, setting credit limits, and ultimately approving or denying them
for credit. The collection department is responsible for collecting on the
delinquent receivables prior to submitting them to a collection agency.
A credit manager has to make sure the entire department is running
efficiently and effectively. The best way to do this is approve the
appropriate number of customers which allows the department and
ultimately the company to make a profit. The credit manager must also
make sure costs and expenses are kept under control which helps to
increase the profit of the organization. If costs go overboard then managermust take a look to see why things went beyond their budget. The credit
manager will have a number of reports which he uses to gauge how
effectively the department is functioning. There will be 30, 60, 90 and 120
day reports which outline the number and percentage of customers who
are delinquent in a given category.
Credit managers also review approval rates, and credit limits to make sure
the department is approving enough customers which ultimately results in
a profit.
The credit manager has to administer performance appraisals to the credit
and collection supervisor to let them know if they are performing in a
satisfactory manner. They also check to ensure the supervisors are
delivering performance appraisals effectively and in a timely manner to the
associates that they supervise.
The credit manger must answer to the Vice-President of Finance with his
findings. If there are large unexplained variances pertaining to any
company activities then the manager will have to address those issues
with the Vice-President of Finance. Normally there is some explanation for
the variances that take place.
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3.13. CASE STUDY:
The below given three cases are the example through which w will be able
to understand that on what all basis the credit manager takes the decision,
the process or steps by following which the manager will grant the credit
limit to the client.
1. when a credit manager approves the case:
An individual when applies for loan there are many grounds on which
his/her loan gets approved or rejected. Basically any bank looking to
finance any car will be more interested in genuineness and soundness of
consumer with reference to his repayment abilities and on that basis the
bank will approve his/her loan. The factors like internal track where
consumer has already has an association with bank in past and is having
good track record similarly his track with other banks is sound then on that
basis also his soundness about his repayment behavior gets judged. Also
his banking is being thoroughly studied where in his annual quarterly
balance is being checked which helps bank to determine whether he will
be able to pay the EMI or not. Also the CIBIL score should be more than
780 which also go in favor of consumer and helps bank to approve the
loan as the score itself is an proof that consumer has before not done any
kind of fraud or has an healthy financial status.
2.when credit manager rejects the case:
For any bank, the main intention of verifying the customers credibility is to
get an idea about his/her repayment abilities, here also when the loan will
be rejected it will on the grounds that he/she is not sound enough to repay
the loan. The some of reasons of it can be
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4. SWOT analysis
STRENGTH:
1. Indian banks have compared favourably on growth, asset quality
and profitability with other emerging economies banks over the last
few years.
2. Policy makers have made some notable changes in policy and
regulation to help strengthen the sector. These changes include
strengthening prudential norms, enhancing the payments system
and integrating regulations between commercial and co-operative
banks.3. Bank lending has been a significant driver of GDP growth and
employment.
4. Extensive reach: the vast networking & growing number of
branches & ATMs. Indian banking system has reached even to the
remote corners of the country.
5. In terms of quality of assets and capital adequacy, Indian banks are
considered to have clean, strong and transparent balance sheets
relative to other banks in comparable economies in its region.
6. Foreign banks will have the opportunity to own up to 74 per cent of
Indian private sector banks and 20 per cent of government owned
banks.
WEAKNESS:
1. PSUs need to fundamentally strengthen institutional skill levels
especially in sales and marketing, service operations, risk
management and the overall organisational performance ethic &
strengthen human capital.
2. Old private sector banks also have the need to fundamentally
strengthen skill levels.
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3. The cost of intermediation remains high and bank penetration is
limited to only a few customer segments and geographies.
4. Structural weaknesses such as a fragmented industry structure,
restrictions on capital availability and deployment, lack of
institutional support infrastructure, restrictive labour laws, weak
corporate governance and ineffective regulation
beyond Scheduled Commercial Banks (SCBs), unless industry
utilities and service bureaus. Refusal to dilute stake in PSU banks :
The government has refused to dilute its stake in PSU banks below
51% thus choking the headroom available to these banks forraining equity capital.
OPPORTUNITY:
1. The market is seeing discontinuous growth driven by new products
and services that include opportunities in credit cards, consumer
finance and wealth management on the retail side, and in fee-
based income and investment banking on the wholesale banking
side. These require new skills in sales & marketing, credit and
operations.With increased interest in India, competition from foreign
banks will only intensify.
2. Given the demographic shifts resulting from changes in age profile
and household income, consumers will increasingly demand
enhanced institutional capabilities and service levels from banks.
3. New private banks could reach the next level of their growth in the
Indian banking sector by continuing to innovate and developdifferentiated business models to profitably serve segments like the
rural/low income and affluent/HNI segments; actively adopting
acquisitions as a means to grow and reaching the next level of
performance in their service platforms. Attracting, developing and
retaining more leadership capacity
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4. Foreign banks committed to making a play in India will need to
adopt alternative approaches to win the "race for the customer" and
build a value-creating customer franchise in advance of regulations
potentially opening up post 2009. At the same time, they should
stay in the game for potential acquisition opportunities as and when
they appear in the near term. Maintaining a fundamentally long-
term value-creation mindset.
5. Reach in rural India for the private sector and foreign banks.
6. With the growth in the Indian economy expected to be strong for
quite some time-especially in its services sector-the demand forbanking services, especially retail banking, mortgages and
investment services are expected to be strong.
7. Reserve Bank of India (RBI) has approved a proposal from the
government to amend the Banking Regulation Act to permit banks
to trade in commodities and commodity derivatives.
THREATS:
1. Threat of stability of the system: failure of some weak banks has often
threatened the stability of the system.
2. Rise in inflation figures which would lead to increase in interest rates.
3. Increase in the number of foreign players would pose a threat to the
PSB as well as the private players.
5.1 PROBLEM INDENTIFICATION:
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A well define problem is half solution of that problem. So it represent single most
important step to be perform i.e. Identification of problem and definition of it. And that is
this task is heart of research work
From the primary observation of the Surat city market of Auto loan, it was known that
there are many players who are in the market which avail Auto finance to people. In
spite of having cut throat competition when bank is looking ahead and trying to cement
its place in market by converting the customer using one product/service into his one
stop banking solution HDFC wants to know expectations of people from bank and also
cross selling of product with Car loan.
5.2. OBJECTIVE OF STUDY:
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Following are the major objective the research study
To know the expectation of car loan consumers of HDFC from financer
To find reasons for people selecting a bank as there one-stop banking solution
To track the cross selling nature of motor insurance through Auto loan
5.3. LIMITATION OF STUDY :
Following are the major limitation the research study
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5.3.1. Scope/area of study is restricted to only Surat city.
5.3.2. Study considered only sample of 155 customers.
5.3.3.The time period of the survey being only seven weeks it was not possible to
conduct a highly in depth and detailed study, which in turn might affect the findings.
5.3.4. The information collected in the interview can be biased to a little extent as they
express them.
The noun design has various meaning but the one suitable for our subjective is a
pattern or outline of research projects working. It is a statement of only the essential
element of a study i.e. more or less blueprint of research.
Research design is the plan, structure and strategy of investigation conceived so as
obtain answers to research question and control variance. Research is as old as the
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The research has got clear-cut objective, specific date requirement and uses a large
sample, which is drawn through a Probability sampling design.
6.2. SOURCE OF DATA
Primary source of data
In my project I have collected the information by conducting personal survey and using
questionnaire as a tool.
Secondary source of data
Two types of secondary data were collected for the preparation of the project work:
Internal Data was generated from companys brochures. External Data, on the other hand, was generated from research books and
internet (websites).
6.3. DATA COLLECTION METHOD
I have used Personal survey and E-survey method to collect the data from the
respondents.
6.4. POPULATION
In the research, the entire population constitutes of businessmen / professional / service
person who have taken Auto loan from HDFC bank.
6.5. SAMPLING METHOD
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Convenience sampling is the tool used as the sampling method. Because in this
procedure the members of the population are first assigned to groups or strata on the
basis of some characteristic and a simple random is drawn from each stratum.
6.6.SAMPLE SIZE
Sample size denotes the number of elements selected for the study. For the present
study, 155 respondents were selected at random .
6.7. DATA COLLECTION TECHNIQUE
To know the response, I used questionnaire method. Initially a rough draft was prepared
keeping the objective of research in mind. Then a pilot study was undertaken in order to
know the accuracy of the questionnaire. The questionnaire was finalized only after
important changes were incorporated. I have collected the information by conducting
personal survey.
For analysis of data, I have used cross tabulation, statistical test, percentage, graphs,
and other tools.
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Interpretation:
As the value is more than 0.05 thus the null hypothesis is accepted and thus there is no
association between satisfaction level and recommendation. This shows that the
association between satisfaction level and recommendation is not there, which means
that if an consum is dissatisfied with the bank he may not recommend it to others but he
may not criticize it in front of his friends and relatives as there would have been specific
issye due to which he is not satisfied with bank
2. Is there any association between taking motor insurance from same vendor and
improvement expectation in product/service?
H:0 There is no association between them
H:1 There is association between them.
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
motorinsurance * improvement 155 98.7% 2 1.3% 157 100.0%
sided)
Pearson Chi-Square 8.120 a 4 .087
Likelihood Ratio 9.102 4 .059
Linear-by-Linear
Association
3.510 1 .061
N of Valid Cases 155
a. 4 cells (40.0%) have expected count less than 5.
The minimum expected count is .37.
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motorinsurance * improvement Crosstabulation
Count
improvement Total
Product Service
motorinsurance yes 64 73 137
no 9 9 18
Total 73 82 155
Chi-Square Tests
Value Df Asymp.
Sig. (2-
sided)
Exact Sig.
(2-sided)
Exact Sig.
(1-sided)
Pearson Chi-Square .069 a 1 .793
Continuity
Correctionb
.000 1 .991
Likelihood Ratio .069 1 .793
Fisher's Exact Test .807 .494
Linear-by-Linear
Association
.068 1 .794
N of Valid Cases 155
a. 0 cells (.0%) have expected count less than 5. The minimum expected count
is 8.48.
b. Computed only for a 2x2
table
Interpretation:
As here the chisquare value is more than 0.05 thus we will accept the null hypothesis
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and thus there is no association in people opting for motor insurance and expecting a
improvement in product or service, which is signal that bank can has an fair chance to
sell its motor insurance to its consumers irrespective of expectation of people for
improvement in product or service
Features which people want in bank for making it there one-stop banking solution.:
1. Better and fast service.
Below table shows that better and fast service is rated as most important by 41 peopleimportant by 56 people and least important by 58 people
Better and fast service
Frequency Percent Valid
Percent
Cumulative
Percent
Valid mostimportant
41 26.1 26.5 26.5
Important 56 35.7 36.1 62.6
least
important
58 36.9 37.4 100.0
Total 155 98.7 100.0
Missing System 2 1.3
Total 157 100.0
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Interpretation:
Here the ratings are given as per the consumers willingness of features in the bank for
making it one stop banking solution. The bar graph shows for consumers the fast and
better service is not that much important as majority of them have rated it as least
important
2. Availabilty of branches:
|
Availability of services
Frequency Percent Valid Percent Cumulative Percent
Valid most important 68 43.3 43.9 43.9
important 45 28.7 29.0 72.9
least important 42 26.8 27.1 100.0
Total 155 98.7 100.0
Missing System 2 1.3
Total 157 100.0
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Interpretation:
As per the data available we can clearly see that most of people have rated
availability of branches as most important feature required in any bank. And thus
here also HDFC bank has upper hand as its distribution network is widely spreaded
and thus it will help bank to have in depth penetration.
3. Brand Name:
brand name
Frequency Percent Valid Percent Cumulative Percent
Valid most important 45 28.7 29.0 29.0
important 56 35.7 36.1 65.2
least important 54 34.4 34.8 100.0
Total 155 98.7 100.0
Missing System 2 1.3
Total 157 100.0
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Interpretation:
Here we can see that consumers have rated Brand name as important feature in
making bank as there one stop banking solution. And HDFC has an trustworthy
name and thus this is also an positive point for bank.
Percentage of finance:
Percentage
Frequen Percen Valid Cumulative
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cy
Valid 30% -
50%
50% -
65%
1
65% -
85%
1
Total 1
Missin
g
System
Total 1
Interpretation:
Consumers who opt for
that bank should provid
t Percent Percent
1 19.7 20.0 20.0
7 10.8 11.0 31.0
7 68.2 69.0 100.0
5 98.7 100.0
2 1.3
7 100.0
auto finance basically opt maximum fina
e maximum finance to the consumers.
nce. This shows
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2. Competitive rate of interest:
Competitive Interest rate
Frequen
cy
Percen
t
Valid
Percent
Cumulative
PercentValid 1
rating
43 27.4 27.7 27.7
2
rating
53 33.8 34.2 61.9
3
rating
35 22.3 22.6 84.5
4
rating
24 15.3 15.5 100.0
Total 155 98.7 100.0
Missin
g
Syste
m
2 1.3
Total 157 100.0
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3. Transparacny in deal:
Transparancy in deal
Frequency
Percent
ValidPercent
CumulativePercent
Valid 1
rating
48 30.6 31.0 31.0
2
rating
43 27.4 27.7 58.7
3
rating
39 24.8 25.2 83.9
4
rating
25 15.9 16.1 100.0
Total 155 98.7 100.0
Missin
g
Syste
m
2 1.3
Total 157 100.0
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4. Less documentation:
Less documentation
Frequen
cy
Percen
t
Valid
Percent
Cumulative
Percent
Valid 1
rating
40 25.5 25.8 25.8
2rating
34 21.7 21.9 47.7
3
rating
40 25.5 25.8 73.5
4
rating
41 26.1 26.5 100.0
Total 155 98.7 100.0
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Missin
g
Syste
m
2 1.3
Total 157 100.0
Findings:
1. Out of research conducted I have found that for consumers basically requiring
car loan look forward of having easy and fast availability of finance.
2. The rigidness in the documentation is also an factor which is not being willingly
accepted by consumers.
3. Improvement is required in product and service with more personalized and
customized features
Recommendations:
1. The most important thing which bank should focus is on focusing on different
products which can be cross sold with auto- loan
2. Less documentation will also help bank to reduce the rigidness in the process
3. More customized and personalized service should be provided to consumers.
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