Customer Satisfaction of Banking Industry

7/25/2019 Customer Satisfaction of Banking Industry

1/4

Customer Satisfaction regarding Loan Schemes of Banking Industry

Bank Loans : Leading of fund to the constituents, mainly traders, business and industrial

enterprises, constitutes the main business of the banking industry. The major portion of a Bank

fund is employed by way of loans, which is the most profitable employment of its fund. Themajor part of bank is earned from interest. The business of leading, nevertheless is not without

certain inherit risks largely depending on the borrowed funds, a banker therefore, follow a very

caution policy, and conduct his business on the basis on the basis of safety, liquidity, profitability

etc.

MEANING OF LOANS

nder the lonas, credit is given for a definite purpose and for a predetermined period. !ormallythese loans are repayable in installments. "unds are required for single non#repetitive

transactions and are withdrawn only once. $f the borrower need funds again or wants renewal of

an e%isting loan, a fresh request is made to the bank.This borrower is required to negotiate every time& he is taking a new loan or renewing an

e%isting loan. Banker is at liberty to grant or refuse such a request depending upon his owner

cash resources and credit policy of the control bank.

PO!EC" EPO" ON "#PES OF LOANSBank grants loan for different periods short, medium and long and for different purposes.

Short "erm Loans

'hort#term loan is granted to meet the working capical needs of the borrowers. These loans are

granted against securities of tangible assets mainly the movable assets like goods andcommodities, shares, debentures etc. 'ince (pril )**+, B$ has made it mandatory for the banks

to grant a portion of bank credit to big customers in the form of loans, which may be for various

maturities. The B$ has also permitted the banks to roll over such loans i.e. to e%tend the loan foranother period at the e%piry of the tenure of the first loan.

"erm Loan-edium and long#term loans are usually called Term loans/. These loans are granted for more

than one year and also meant for the purpose of capital asset for establishment of new e%pansion

or diversification of an e%isting unit. Banks usually grant such loans together with speciali0ed

financial institutions like industrial "inance 1orporation of $ndia, credit and investmentcorporation etc.

$n (pril )**+, B$ banned bridge loan granted by banks and financial institutions to all

companies. But in oct. )**+, B$ permitted banks to sanction bridge loans 2$nterim finance bybanks subject to some conditions in no. )**3, B$ permitted to banks to grants bridge loans to

companies 4other than non#banking finance companies5 against public issue of equity of $ndia or

in abroad.

Com$osite Loans

6hen a loan is granted both for buying capital assets and for working capital purpose it is called

composite loans. 'uch loans are ususllly granted to small borrowers such as artisans, farmers,small industries etc.

etai% %oans
http://www.allprojectreports.com/MBA-Projects/Finance-Project-Report/Project-Analysis-Bank-Loan-Schemes/Bank-Loan-Project.htmhttp://www.allprojectreports.com/MBA-Projects/Finance-Project-Report/Project-Analysis-Bank-Loan-Schemes/Bank-Loan-Project.htm


2/4

These are loans that are given to individuals for their purpose, etail loans can be subdivided

into 7 categories.

&ousing Loans

This is the loans scheme that is offered to individual for constructions of house, purchase of

house, plot purchase, repair, renovation, purchase of flat from private builder, for furnishing etc.

This is one of the retail product thus involve colossal volumes in terms of customers and dunds.

Education Loans8ducation loan is given to the students for further studies in $ndia and abroad both. This loan can

be for air fare travel e%penses admission2tuition fees, boarding and lodging e%penses books 9

stationary e%penses etc.

Auto Loans

(uto loan is given to individual to buy old2new car and two wheeler. $t is very popular loan

among borrowers as today everyone want vehicle in their home and bank provide them at easyinstallments.

Persona% Loans

Though normally banks provide loans for productive purpose only, but as a e%ception loans aregranted on a limited scale to meet the medical needs or the educational e%penses or e%penses

relating to marriage or other social purpose of the needs persons. 'uch )'oans are calledersonal loans.

A'(AN"AGE OF LOANS

Financia% disci$%ine of the )orro*er

(s the time of repayment of loans or its installments is fi%ed. $n advance, these systems ensure a

greater degree of self discipline of borrower as compared to cash credit system.

Periodic re+ie* of %oans A,C

6henever a loan is granted or its renewal is sanctioned, the banker gets an opportunity of

automatically reviewing the loan account. nsatisfactory loan account may be discontinued atthe discretion of the banker.

Profita)i%ity

'ystem is comparatively simple, interest occurs to the bank on the entire amount lent to acustomer.

'A-BAC. OF LOANS

8very time loan is required. $t is to be negotiable with the banker. To avoid it, borrower may

borrow in e%cess of their e%act requirement to provide for any contingency. Bank have no control over the use of fund borrowed by the customers, however banks insist

on hypothecation of the asset2vehicle purchase with loan amount.

Though the loans are for fi%ed period but in practice they roll over i.e. they are renewed

frequently.

Loan documentation is more comprehensive as compared to cash credit system.

E"AIL LOANS

Loan become necessary for every money minded person ."rom this way they can invest theirmoney in other profitable purposes . The best coming way to get loan for building home for

buying automobiles or education of your for personnel purposes is provided by Bank ;f unjab

ltd. at preferential rate of interest . $f you are eligible for loan then u will have money in hand invery few days. The bank will provide you the facility of re payment in easy installments the loan

are made available at your doorstep.

IN"O'/C"ION "O &OME LOANS


3/4

The bank will take over the loan from that institution. 1omposite scheme:


4/4

The age of applicant should not e%ceed @+ years during the loan tenure.

Non2esidentia% Indian

(ny $ndian citi0en who is a non#residential and holding valid $ndian passport can apply for

home loan under the !$ scheme./

!$ may be required to provide a guarantor residing in $ndia.

The age of applicant should be more than + years./

The individual should be of salaried class.

Security re3uired for the %oan 1

The person who is applying for loan need to provide security of the financed property and2or

such additional2collateral security may be mutually agreed.

Cocuments required: the indicative list is given below.

Documents

Customer Satisfaction of Banking Industry