Project Report on Personal Loan

HDFC BANK LTD (PERSONAL LOAN) 1

CHAPTER-1

INTRODUCTION

1.1 GENERAL INTRODUCTION

The banking sector is the most dominant sector of the financial system in India.

Significant progress has been made with respect to the banking sector in the past

liberalization period. The financial health of the commercial banks has improved


manifolds with respect to capital adequacy, profitability, asset quality and risk

management. Further, deregulation has opened new opportunities for banks to increase

revenue by diversifying into investment banking, insurance, credit cards, depository

services, mortgage, securitization, etc. Liberalization has created a more competitive

environment in the banking sector.

Indian Banking Sector:


Banking in India has its origin as early as the Vedic period. It is believed that the

transition from money lending to banking must have occurred even before Manu, the

great Hindu thinker, who has devoted a section of his work to deposits and advances

and laid down rules relating to rates of interest. During the Mogul period, the indigenous

bankers played a very important role in lending money and financing foreign trade and

commerce. During the days of the East India Company, it was the turn of the agency

houses to carry on the banking business. The General Bank of India was the first Joint

Stock Bank to be established in the year 1786. The others that followed were the Bank

of Hindustan and the Bengal Bank. The Bank of Hindustan is reported to have

continued till 1906 while the other two failed in the meantime. In the first half of the 19 th

century the East India Company established three banks; the Bank of Bengal in 1809,


the Bank of Bombay in 1840 and the Bank of Madras in 1843. These three banks also

known as Presidency Banks, were independent units and functioned well.

These three banks were amalgamated in 1920 and a new bank, the Imperial

Bank of India was established on 27th January 1921. With the passing of the State Bank

of India Act in 1955 the undertaking of the Imperial Bank of India was taken over by the

newly constituted State Bank of India. The Reserve Bank which is the Central Bank was

created in 1935 by passing Reserve Bank of India Act 1934. In the wake of the

Swadeshi Movement, a number of banks with Indian management were established in


the country namely, Punjab National Bank Ltd, Bank of India Ltd, Canara Bank Ltd,

Indian Bank Ltd, the Bank of Baroda Ltd, the Central Bank of India Ltd. On July 19,

1969, 14 major banks of the country were nationalized and in 15 th April 1980 six more

commercial private sector banks were also taken over by the government. Today the

commercial banking system in

Types of Banks in India:

In India the banking sector are mainly classified in to four categories are as follows

1.3.1 State Bank of India and its associate banks called the State Bank group


1.3.2 20 nationalized banks

1.3.3 Regional Rural Banks mainly sponsored by Public Sector Banks

1.3.4 Private Sector Banks

1. Old generation private banks

2. New generation private banks

3. Foreign banks in India

4. Scheduled Co-operative Banks


1.2 INDUSTRY PROFILE

a. Origin and development of the industry

The origin of banking in India is traceable in ancient time through the modern banking

hardly 200 years old. The main functions of a bank are to accept deposits and grant

loans. There are evidences of these functions being performed by a section o the


community in the Vedic periods. There are many references of Debt in the Vedic

Literature. During the Ramayana and Mahabharata eras banking, which was a side

businesses during the Vedic period, became a full-time business activity for the people.

During the Smriti period, the banking business was carried on by the members of the

Vanish community and Manu speaks of earning through interest as the business of

Vaishyas. He accepted deposits from the public, granted loans against pledges and

personal security, granted simple open loans, acted as bailee for his customers,

subscribed to public loans by granting loans to kings, acted as treasurer and banker to


the state and managed the currency of the country. Indigenous bankers used to

maintain a regular system of accounts and borrowers used to sign the loan deeds.

Money changing came into vogue and the state regulation of the business

became more systematic.

Indigenous bills of exchange came also in use.

The maximum rates of interest were fixed.


Development from Independence until 1991

At the time of Independence in 1947, the banking system in India was fairly well

developed with over 600 commercial banks operating in the country. However, soon

after Independence, the view that the banks from the colonial heritage were biased in

favor of working-capital loans for trade and large firms and against extending credit to

small-scale enterprises, agriculture and commoners, gained prominence. To ensure

better coverage of the banking needs of larger parts of the economy and the rural


constituencies, the Government of India (GOI) created the State Bank of India (SBI) in

1955. Despite the progress in the 1950s and 1960s, it was felt that the creation of the

SBI was not far reaching enough since the banking needs of small scale industries and

the agricultural sector were still not covered sufficiently. Following the Nationalization

Act of 1969, the 14 largest public banks were nationalized which raised the Public

Sector Banks' (PSB) share of deposits from 31% to 86%. The two main objectives of the

nationalizations were rapid branch expansion and the channeling of credit in line with

the priorities of the five-year plans. To achieve these goals, the newly nationalized


banks received quantitative targets for the expansion of their branch network and for the

percentage of credit they had to extend to certain sectors and groups in the economy,

the so-called priority sectors, which initially stood at 33.3%. The main policy changes

were the introduction of Treasury Bills, the creation of money markets, and a partial

deregulation of interest rates. Besides the establishment of priority sector credits and

the nationalization of banks, the government took further control over banks' funds by

raising the statutory liquidity ratio (SLR) and the cash reserve ratio (CRR). From a level

of 2% for the CRR and 25% for the SLR in 1960, both witnessed a steep increase until


1991 to 15% and 38.5% respectively. In summary, India's banking system was at least

until an integral part of the government's spending policies. Through the CRR and the

SLR more than 50% of savings had either to be deposited with the RBI or used to buy

government securities. Of the remaining savings, 40% had to be directed to priority

sectors that were defined by the government. Besides these restrictions on the use of

funds, the government had also control over the price of the funds, i.e. the interest rates

on savings and loans. This was about to change at the beginning of the 1990s when a

balance-of-payments crisis was a trigger for far-reaching reforms.


Developments after 1991


The 1991 report of the Narasimham Committee served as the basis for the initial

banking sector reforms. In the following years, reforms covered the areas of interest

rate deregulation, directed credit rules, statutory pre-emptions and entry deregulation for

both domestic and foreign banks. The objective of banking sector reforms was in line

with the overall goals of the 1991 economic reforms of opening the economy, giving a

greater role to markets in setting prices and allocating resources, and increasing the

role of the private sector.


Statutory pre-emption

The degree of financial repression in the Indian banking sector was significantly

reduced with the lowering of the CRR and SLR, which were regarded as one of the

main causes of the low profitability and high interest rate spreads in the banking system.

During the 1960s and 1970s the CRR was around 5%, but until 1991 it increased to its

maximum legal limit of 15%. From its peak in 1991, it has declined gradually to a low of

4.5% in June 2003. In October 2004 it was slightly increased to 5% to counter


inflationary pressures, but the RBI remains committed to decrease the CRR to its

statutory minimum of 3%. The SLR has seen a similar development. The reduction of

the CRR and SLR resulted in increased flexibility for banks in determining both the

volume and terms of lending.

Priority sector lending


Besides the high level of statutory pre-emption, the priority sector advances were

identified as one of the major reasons for the below average profitability of Indian banks.

The Narasimham Committee therefore recommended a reduction from 40% to 10%.

However, this recommendation has not been implemented and the targets of 40% of net

bank credit for domestic banks and 32% for foreign banks have remained the same.

Public Sector Banks


At the end of the 1980s, operational and allocation inefficiencies caused by the

distorted market mechanism led to a deterioration of Public Sector Banks' profitability.

Enhancing the profitability of PSBs became necessary to ensure the stability of the

financial system. The restructuring measures for PSBs were threefold and included

recapitalization, debt recovery and partial privatization. Prior to any privatization, the

balance sheets of PSBs had to be cleaned up through capital injections. In the fiscal

years 1991/92 and 1992/93 alone, the GOI provided almost Rs40 billion to clean up the


balance sheets of PSBs. Between 1993 and 1999 another Rs120 billion were injected in

the nationalized banks. In total, the recapitalization amounted to 2% of GDP.

b. Growth and present status of the Industry


The financial sector is in a process of rapid transformation. Reforms are continuing as

part of the overall structural reforms aimed at improving the productivity and efficiency

of the economy. The role of an integrated financial infrastructure is to stimulate and

sustain economic growth.

The Reserve Bank of India (RBI) has successfully introduced a regime where interest

rates are more in line with market forces.


Financial institutions have combated the reduction in interest rates and pressure on

their margins by constantly innovating and targeting attractive consumer segments.

Banks and trade financiers have also played an important role in promoting foreign

trade of the country.

The Indian banking system has a large geographic and functional coverage. Presently

the total asset size of the Indian banking sector is US$ 270 billion while the total

deposits amount to US$ 220 billion with a branch network exceeding 66,000 branches

across the country. Revenues of the banking sector have grown at 6 per cent CAGR


over the past few years to reach a size of US$ 15 billion. While commercial banks cater

to short and medium term financing requirements, national level and state level financial

institutions meet longer-term requirements. This distinction is getting blurred with

commercial banks extending project finance.

Banks, as we all know, are subjected to more intense regulation as compared to the

non-financial firms. Bank regulation is now increasingly getting risk-centric. This process

had its origin in the Cooke Committee or the Basel I proposals which for the first time

prescribed a risk-based capital adequacy framework for banks by recognizing that


different counterparties had different risks and therefore had to be risk-weighted

differently

c. Future of the Industry


The interplay between policy and regulatory interventions and management strategies

will determine the performance of Indian banking over the next few years. Legislative

actions will shape the regulatory stance through six key elements:

1) industry structure and sector consolidation

2) freedom to deploy capital

3) regulatory coverage

4) labour reforms and human capital development


5) corporate governance

6) support for creating industry utilities and service bureaus.

Management success will be determined on three fronts:

1) fundamentally upgrading organizational capability to stay in tune with the

changing market


2) adopting value-creating M&A as an avenue for growth

3) Continuously innovating to develop new business models to access untapped

opportunities.

Changes in regulations and bank capabilities reduce intermediation costs leading to

increased growth, innovation and productivity. Banking becomes an even greater driver

of GDP growth and employment and large sections of the population gain access to

quality banking products. Management is able to overhaul bank organizational


structures, focus on industry consolidation and transform the banks into industry

shapers.

The Reserve Bank of India has, in the service of our country, a proven track record and

professionalism, which have lent it considerable credibility - both domestically and

globally. This credibility enables the RBI to confidently carry the reforms forward to

credibly maintain price and financial stability, while enabling self-accelerating equitable

growth at elevated levels The Indian financial sector is ready for consolidation, said 95

per cent of the respondents. Given the increased competition, and the implementation


of Basel II norms in the near future, the banking industry of the country would be better

off with six to seven banks as big as State Bank of India, said the survey.

Areas that need improvement include diversification of markets beyond big cities,

human resources systems, size of banks, high transaction costs, and infrastructure and

labor inflexibilities. some strategies that can help India achieve a world class banking

system are consolidation, strict corporate governance norms, and regional expansion

within the country and outside, higher FDI limits and Free Trade Agreements with

countries where India has comparative advantage in banking sector.


India has among the lowest penetration of retail loans in Asia. Though the sector has

been growing at around 15 per cent, there is still a huge opportunity to tap into. Retail

loans and lending to small and medium enterprises will emerge as the two biggest

areas of growth in the future for the Indian banking sector

The total assets in the banking sector today are estimated to be at Rs 17 trillion and

total deposits are estimated at Rs 13 trillion. There are over 290 scheduled banks in the

country today, of which 190 are regional rural banks. There are just 9 Indian private

sector banks. Together the banking industry offers 66,000 branches across India.


CHAPTER-2

PROFILE OF THE ORGANIZATION


2.1 ORIGIN OF THE ORGANIZATION


HDFC is India's premier housing finance company and enjoys an impeccable track

record in India as well as in international markets. Since its inception in 1977, the

Corporation has maintained a consistent and healthy growth in its operations to remain

the market leader in mortgages.

Its outstanding loan portfolio covers well over a million dwelling units. HDFC has

developed significant expertise in retail mortgage loans to different market segments

and also has a large corporate client base for its housing related credit facilities. With its

experience in the financial markets, a strong market reputation, large shareholder base


and unique consumer franchise, HDFC was ideally positioned to promote a bank in the

Indian environment.

2.2 GROWTH AND DEVELOPMENT OF THE ORGANIZATION

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network

of over 1400 branches spread over 600 cities across India. All branches are linked on

an online real-time basis. Customers in over 120 locations are also serviced through

Telephone Banking. The Bank's expansion plans take into account the need to have a


presence in all major industrial and commercial centers where its corporate customers

are located as well as the need to build a strong retail customer base for both deposits

and loan products.

The Bank also has a network of about over 2000 networked ATMs across these cities.

Moreover, HDFC Bank's ATM network can be accessed by all domestic and

international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American

Express Credit/Charge cardholders.


2.3 PRESENT STATUS OF THE ORGANIZATION

The Housing Development Finance Corporation Limited (HDFC) was amongst the

first to receive an ‘in-principle’ approval from the Reserve Bank of India (RBI) to set up a

bank in the private sector, as part of the RBI’s liberalization of the Indian Banking

Industry in 1994. 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.


Promoter

HDFC is India’s premier housing finance company and enjoys an impeccable track

record in India as well as in international markets. Since its inception is 1977, the

Corporation has maintained a consistent and healthy growth in its operations to remain

a market leader in mortgages.


Business Focus

HDFC Bank’s mission is to be a World-Class Indian Bank. The Bank’s aim is to build

sound customer franchises across distinct businesses so as to be the preferred

provided of banking services in the segments that the bank operates in and to achieve

healthy growth in profitability, consistent with the bank’s risk appetite.


Capital Structure

The authorized capital of HDFC Bank is Rs.450 crore (Rs.45 billion). The paid-up

capital is Rs282 crore (Rs.28.2 billion). The HDFC Group holds 24.2% of the bank’s

equity while about 13.1% of the equity is held by the depository in respect of the bank’s

issue of American Depository Shares (ADS/ADR Issue)..


Distribution Network


of over 1400 branches spread over 600 cities across the country. All branches are

linked on an online real-time basis. Customers in 90 locations are also serviced through

Phone Banking. The Bank’s expansion plans take into account the need to have a




and loan products.

Management

Mr.Jagdish Kapoor took over as the bank’s Chairman in July 2001, Prior to this,

Mr.Kapoor was a Deputy governor of the Reserve Bank of India.


The Managing Director, Mr.Aditya Puri, has been a professional banker for over 25

years. And before joining HDFC Bank in 1994 was heading Citibank’s operations in

Malaysia.

The Bank’s Board of Directors is composed of eminent individuals with a wealth of

experience in public policy, administration, industry and commercial banking. Senior

executive representing HDFC are also on the Board Senior banking professionals with

substantial experience in India and abroad head various businesses and functions and

report to the Managing Director.


2.4 FUNCTIONAL DEPARTMENTS OF THE ORGANIZATION

The bank has three key business areas:

1. Wholesale Banking Services

Here our target market is primarily large, blue-chip companies and to a lesser extent,

emerging mid-sized corporate. For these corporate, we provide a wide range of

services, including working capital finance, trade services, transactional services, cash


management, etc. We are a leading provider of structured solutions, which combine

cash management services with vendor and distributor finance, for facilitating superior

supply chain management for our corporate customers. We are also recognized as a

leading provider of cash management and transactional banking solutions to mutual

funds, stock exchange members and banks.

2. Retail Banking Services


The objective of the Retail Bank is to provide our target market customers a full range of

financial products and banking services, giving the customer a one-stop window for all

his/her banking requirements. The products are backed by world-class service and

delivered to the customers through the growing branch network, as well as through

alternative delivery channels like ATMs, Phone Banking, Net Banking and Mobile

Banking. The HDFC Bank Preferred program for high net worth individuals, the HDFC

Bank Plus and the Investment Advisory Services programs have been designed

keeping in mind needs of customers who seek distinct financial solutions, information


and advice on various investment avenues. We have a wide array of retail loan products

including Auto Loans, Loans against Securities, Personal Loans and Loans for Two-

wheelers.

3. Treasury Operations


Within this business, the bank has three main product areas -

a) Foreign Exchange and Derivatives

b)Local Currency Money Market &

c) Debt Securities and Equities.

With the liberalization of the financial markets in India, corporate need more

sophisticated risk management information, advice and product structures. These are


provided through the bank's Treasury team. The Treasury business is responsible for

managing the returns and market risk on the bank's investment portfolio.

The above business groups are supported by the following groups:

Audit & Compliance

Credit & Market Risk

Finance, Administration & Legal


Human Resources

Information Technology

Operations

4. Systems & Technology

The Bank uses state-of-the-art technology for both internal and external customers.

a) Banking Applications


In terms of software, the Corporate Banking business is supported by UBS, while the

Retail Banking business by Finware. These world-class systems have been specially

customized for HDFC Bank by i-flex Solutions Ltd. which is a Citigroup company. The

Bank also uses various other systems to support other infrastructure –

b).Lotus Notes

Lotus Notes is the system that HDFC bank uses for internal communication.

c) Facilities Management


Wipro is the company appointed to give HDFC Bank the on-site support required at

different locations / cities.

2.5 ORGANIZATION STRUCTURE AND ORGANIZATION CHART

HDFC Bank Board of Directors comprises of eminent individuals with a wealth of

experience in public policy, administration, industry and commercial banking. Senior

executives representing HDFC are also on the Board.


ORGANIZATION CHART

Chairman

Managing Director & CEO

Joint Managing Director

(Domestic Banking)

Joint Managing Director

(International Business)

General Managers


Executive Director

(Corporate Center)

Executive Director

(Wholesale Banking)

Executive Director

(Project Finance)

Executive Director

(Retail Banking)


Sr. General Managers

SALES Manager 1

SALES Manager 2

SALES Manager 4

Sales Manager


TEAM LEADER

BDE 1 BDE 2

TEAM LEADER

TEAM LEADER

TEAM LEADER

BDE 1 BDE 2BDE 1 BDE 2BDE 1 BDE 2



2.6 PRODUCT AND SERVICE PROFILE OF THE ORGANIZATION

Products of HDFC Bank includes the following:

Deposits:

1) Savings Account

These accounts are primarily meant to inculcate a sense of saving for the future,

accumulating funds over a period of time. Whatever your occupation, we are confident


that you will find the perfect banking solution. Open an account in your name or register

for one jointly with a family member today. Some of its features are:

Debit-cum-ATM card

Auto Invest Account

Internet Banking

Phone banking

Anywhere Banking

Standing Instruction


Nomination facility

Doorstep service

Mobile banking

Monthly free E-Mail statement

3) Personal Loan


Loans up to Rupees one million for any purpose.

Flexible Repayment Options ranging from 12 to 48 months.

Repayment through Easy Monthly Installments (EMIs).

Low Rate of Interest

Hassle free loans - No guarantor/security/collateral required

Speedy loan approval

Service at the customer's doorstep

Further, there are additional privileges for HDFC Bank account holders like:


Special rates of interest.

For existing Auto Loan customers with a clear repayment of 12 months or more

from even any of the approved financiers of HDFC Bank, a hassle free personal

loan without income documentation can be obtained.

For existing HDFC Bank Personal Loan customer with a clear repayment of 12

months or more, personal loan can be enhanced.


4) Senior Citizen Services

5) Fixed deposits


Wide range of tenures

Choice of investment plans

Partial withdrawal permitted

Safe custody of fixed deposit receipts

Auto renewal possible

Loan facility available


6) Easy deposit

7) Recurring deposit

Encourage savings

High interest rates of interest

Loans against deposits available

Non-applicability of tax deduction at source (TDS)


8) Special savings account

Bank @ campus

9) Direct Banking Account

10) Tax – Saver Fixed Deposits


11) Roaming Current Account

12) Young Stars or Kids Account

13) Savings Max Account / Regular Account / Plus Account

14) D-Mat Account

15) Family Account


16) NRI account

SERVICES:

a) Retail Banking Services

The objective of the Retail Bank is to provide its target market customers a full range of

financial products and banking services, giving the customer a one-stop window for all

his/her banking requirements. The products are backed by world-class service and


delivered to the customers through the growing branch network, as well as through

alternative delivery channels like ATMs, Phone Banking, Net Banking and Mobile

Banking.

b) Wholesale Banking Services


Here our target market is primarily large, blue-chip companies and to a lesser extent,

emerging mid-sized corporate. For these corporate, we provide a wide range of

services, including working capital finance, trade services, transactional services, cash

management, etc. We are a leading provider of structured solutions, which combine

cash management services with vendor and distributor finance, for facilitating superior

supply chain management for our corporate customers. We are also recognized as a

leading provider of cash management and transactional banking solutions to mutual

funds, stock exchange members and banks.


2.7 MARKET PROFILE OF THE ORGANIZATION

HDFC is India's premier housing finance company and it is the largest private bank in

India. HDFC Bank enjoys an impeccable track record in India as well as in international

markets. Since its inception in 1977, the Corporation has maintained a consistent and

healthy growth in its operations to remain the market leader in mortgages. Its

outstanding loan portfolio covers well over a million dwelling units. HDFC has developed

significant expertise in retail mortgage loans to different market segments and also has


a large corporate client base for its housing related credit facilities. With its experience

in the financial markets, a strong market reputation, large shareholder base and unique

consumer franchise, HDFC was ideally positioned to promote a bank in the Indian

environment.

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build

sound customer franchises across distinct businesses so as to be the preferred provider

of banking services for target retail and wholesale customer segments, and to achieve

healthy growth in profitability, consistent with the bank's risk appetite. The bank is


committed to maintain the highest level of ethical standards, professional integrity,

corporate governance and regulatory compliance. HDFC Bank's business philosophy is

based on four core values - Operational Excellence, Customer Focus, Product

Leadership and People.

In a milestone transaction in the Indian banking industry, Times Bank Limited (another

new private sector bank promoted by Bennett, Coleman & Co./Times Group) was

merged with HDFC Bank Ltd., effective February 26, 2000. As per the scheme of

amalgamation approved by the shareholders of both banks and the Reserve Bank of


India, shareholders of Times Bank received 1 share of HDFC Bank for every 5.75

shares of Times Bank. The acquisition added significant value to HDFC Bank in terms

of increased branch network, expanded geographic reach, enhanced customer base,

skilled manpower and the opportunity to cross-sell and leverage alternative delivery

channels.


of over 1400 branches spread over 600 cities across India. All branches are linked on

an online real-time basis. Customers in over 120 locations are also serviced through


Telephone Banking. The Bank's expansion plans take into account the need to have a



and loan products. Being a clearing/settlement bank to various leading stock

exchanges, the Bank has branches in the centers where the NSE/BSE has a strong and

active member base.



CHAPTER 3

DISCUSSIONS ON TRAINING

3.1 Student’s work profile


(Roles and responsibilities)

The internship period in HDFC Bank was a good learning experience. I worked for

Direct Sales team of the organization as a “Business Development Executive” where

my job was to loing for Personal Loan of bank and source new customers at the HDFC

Bank LTD. In WhiteFeild Branch . My work involved some field work as well as making

extensive cold calls to customers in order to generate database and keep updates on

customer satisfaction.


Every new “Business Development Executive” of the sales team have to undergo a

three day compulsory product training in the Indira Nagar Head Branch, of HDFC Bank

Ltd., Bangalore. Once every member of the team is trained on the products i.e.

Personal Loan of the bank, the manager-in-charge sets a weekly target for the team as

well as for each team member. The team leader keeps track of the targets and arrange

for the necessary changes in case the targets are not achieved.

Every day my work would start off with calling up customers and make follow ups of

those customers who are interested in personal loan with HDFC Bank. Apart from


calling, I also need to report the daily sales report to my manager on a regular basis.

Once the follow up calls are made, my job wants me to interact with the customers

regarding the products, in and outside the organization. Hence my next steps include

fixing appointments for the interested customers and collecting the essential documents

to log in the application forms. Also, a BDE need to go on field for generation of new

database and organizing sales activities in order to boost up sales.


The assigned job responsibilities also include creating loyal customers and conducting

promotional campaigns, giving presentations, handling customer queries and last but

not the least, achieving the set targets.

3.2 DESCRIPTION OF LIVE EXPERIENCE


As a Business Development Executive I had to interact with customers extensively and

had to login for personal loan for them. My work in office used to begin with listing out

the interested customers out of the daily sales report , from walking customer and then

calling them up and ask for personal loan with HDFC Bank. While speaking over the

phone with the customer I used to provide all the necessary information along with

product details to the customer. Next was fixing up the appointments for the process.

Once the appointments were done I had to go to meet the prospective customer at the

fixed place area and had to generate database and find out new prospects. This


included much challenge as convincing customers is not as easy as it sounds. It had to

follow with product presentations and promotional activities. During the course I had the

opportunity to deal with some big clients like IT companies, BPOs and small enterprises

which were helpful exposures to learn sales and marketing tactics. Last but not the

least, every BDE of the sales team had individual targets to achieve. I had a target of

login of Rs. 10,00,000/- per month which I successfully achieved and maintained during

the internship period.




CHAPTER 4

STUDY OF SELECTED RESEARCH PROBLEM

4.1STATEMENT OF RESEARCH PROBLEM

In today’s era of cut throat competition, it is very importance to gain a cutting edge over

the competition, and develop a large market share. This is only possible if there is a


large customer base for the company. The company must gain confidence of the

customers and provide services par excellence.

Therefore, undertaking the project helps in assessing the customer care level of HDFC

BANK. The study is applied descriptive as well as diagnostic in nature. It also tends to

find the customer view about important aspects of the services. At the same time it was

intended to find the customer view about the product and the quality of service

improvement. In short this problem can be defined as:


“Are customers satisfied with the services at HDFC?”

4.2 STATEMENT OF RESEARCH OBJECTIVES


The important research objectives are listed below:

1. To evaluate the expectations of customers towards personal loan with HDFC Bank.

2. To study the importance of customer relationship.

3. To study the impact of customer relationship management on bank customers.

4. To analyze the expectations of banking customers.

5. To analyze the satisfaction level of customers of HDFC bank on the following criteria:


Working environment

Customer care

Bank timings

Overall services

Special schemes provided


4.3 RESEARCH DESIGN AND METHODOLOGY

For any research, research design is of immense importance as it facilitates the smooth

sailing of various research operations. The method adopted by the researcher for


completing the project is called Research Methodology. In other words, Research

Methodology is simply the plan of action for a research which explains the detail, how

data is to be collected, analyzed and interpreted.

Data becomes information only when a proper methodology is adopted. Thus we can

say methodology is a tool which processes the data into reliable information.

Scope of the study


As the competition level in the banking sector is ever increasing, it becomes

indispensable for the company (HDFC) to conduct the study on the perception and

satisfaction level of its customers. This study will help the company in making its new

strategies to satisfy its customer in the ways in which he or she wants to be satisfied

and to the company its position in the market.

The study on customer satisfaction has the geographical coverage limited to White Field

area and Indira Nagar only. This study will help the company to know in detail about the

customer perception and their attitude towards the company services and products.


The company will gain the feedback from the customer to improve its products and

quality of service.

Methods used for data collection are:

1) Primary Data

2) Secondary Data


Primary data: Primary data are data’s, which are original in nature, and are

collected by the researcher. The method used to collect the primary data was Survey

Method. The survey method included a structured questionnaire that was given to the

respondent.

Secondary data: Secondary data are data, which has been collected and

compiled in advance for another needed purpose. Secondary data is an important


method to know the present problem faced by the account holders in the field of HDFC

Bank.

Newspapers, articles, books, magazines etc. have been used to prepare the

questionnaire.


Tools for data collection

The tool used for data collection is Primarily “Questionnaire method”. The questions

contained:


a) Open-Ended Questions

Where the respondent was given a chance to reply or give suggestions to the

Company. This included Free Responses questions where the respondents were given

the freedom to give suggestions.

b) Close-Ended Questions

Where the respondent was given a lesser chance to reply. This includes Multiple Choice

Questions where the respondents were given a number of alternatives.


Sampling Method Used:

Non probability sampling, i.e., convenient sampling method was used to select a sample

of 100 customers among the customers of the HDFC Bank.

Sample Size:


Sample size of 100 customers are taken from the White Field branch of HDFC Bank

Sampling Method Used:

Random sampling method was used to select a sample of 100 customers among the

customers of HDFC Bank.

Scales:


Respondents were given a scale whose positions range from “Highly Satisfied” to

“Highly Dissatisfied”

Area of survey:

The area selected to find the satisfactory level was in and around White Field area and

Indra Nagar.


4.4 ANALYSIS OF DATA


The study on customer satisfaction has the geographical coverage limit to White

Fieldarea only. This study will help the company to know in detail about the customer

perception and their attitude towards the company services and products. The company

will gain the feedback from the customer to improve its products and quality of service

1) TABLE SHOWING DISTRIBUTION OF AGE


AGE GROUP NO. OF RESPONDENTS PERCENTAGE

20 – 30 22 22%

30–40 43 43%

40 AND ABOVE 35 35%

TOTAL 100 100%


ANALYSIS

The above table shows that 22% of the respondents fall under the age group of 20 –

30 years, 43% of the respondents fall under age group of 30 – 40 years and 35% of the

respondents belonging to age group of 40 and above years.

INFERENCE


Hence it clearly shows that he majority of the respondents fall under the age group of

30–40 years i.e. 43%.


22%

43%

35%

CHART SHOWING DISTRIBUTION OF AGE

20 – 30

30–40

40 AND ABOVE


2) TABLE SHOWING DISTRIBUTION OF GENDER


ANALYSIS

GENDER NO. OF RESPONDENTS PERCENTAGE

FEMALE 43 43%

MALE 57 57%

TOTAL 100 100%


The table shows that there are 57% of male respondents and 43% of female

respondents

INFERENCE

Thus the table clearly shows that the majority of the respondents are male i.e. 57%.


NO. OF RESPONDENTS PERCENTAGE0

10

20

30

40

50

60

FEMALEMALE

CHART SHOWING RESPONDENTS (MALE & FEMALE)


3). THE DISTRIBUTION OF THE MONTHLY NET TAKE HOME

SALARY

MONTHLY HOUSEHOLD

INCOME

NO. OF RESPONDENTS PERCENTAGE

LESS THAN RS 15,000 0 0%

RS 15,000 – RS 30,000 23 23%


MORE THAN RS 30,000 77 77%

TOTAL 100 100%

ANALYSIS


The above table shows that there are no respondents who have a monthly net take

home salary of less than Rs 15,000; there are 23% of the respondents who fall under

Rs 15,000 – Rs 30,000 household income and 77% fall under the more than Rs 30,000

net take home salary category.

INFERENCE

The table clearly shows that the majority of the respondents have more than Rs 20,000

of monthly net take home salary that is 77%



23%

77%

CHART SHOWING DISTRIBUTION OF MONTHLY NET TAKE HOME SALARY

LESS THAN RS 10,000

RS 10,000 – RS 20,000

MORE THAN RS 20,000


4).THE IMPORTANCE OF THE INTEREST RATE ACCORDING

TO THE CUSTOMERS

IMPORTANCE NO.OF RESPONDENTS PERCENTAGE

VERY IMPORTANT 65 65%


SOMEWHAT IMPORTANT 20 20%

NOT SO IMPORTANT 15 15%

NOT AT ALL IMPORTANT 0 0%

TOTAL 100 100%

ANALYSIS


The above table relates that the 65% of the respondents think it’s extremely important

for the interest rate to be convenient, 20% of the respondents think it is somewhat

important, 15% of the respondents think its not so important while none of them think its

not at all important.

INFERENCE

Table number 7 clearly shows that majority of the customers think that it is very

important that the interest rate are convenient i.e. 65%.



65%

20%

15%

IMPORTANCE OF INTEREST RATE

VERY IMPORTANT

SOMEWHAT IMPORTANT

NOT SO IMPORTANT

NOT AT ALL IMPORTANT


5) THE IMPORTANCE OF PROCESSING FEES AND TIME IN

HDFC BANK ACCORDING TO CUSTOMRES

VARAIBLES RESPONDENTS PERCENTAGE

HIGHLY SATISFIED 10 10%

SATISFIED 62 62%

NEUTRAL 23 23%

DISSATISFIED 5 5%


HIGHLY DISSATISFIED 0 0%

TOTAL 100 100%

ANALYSIS


From the above table it can be analyzed that out of 100 respondents 10% are highly

satisfied with the processing fees & time of the bank, 62% are satisfied, 23% are

neutral, 5% are dissatisfied and none are highly dissatisfied.

INFERENCE

Therefore, it can be inferred that almost 5% of the respondents are not happy with the

processing fees & time.This indicates that the customers are not satisfied with the

processing fees & time



10%

62%

23%5%

Importance of processing fees & time

HIGHLY SATISFIEDSATISFIEDNEUTRALDISSATISFIEDHIGHLY DISSATISFIED


7) TABLE SHOWING SIZE OF THE EASY MONTHLY

INSTALLMENT

IMPORTANCE NO. OF RESPONDENTS

PERCENTAGE


VERY IMPORTANT 30 30%

SOMEWHAT IMPORTANT

45 45%

NOT SO IMPORTANT 20 20%

NOT AT ALL IMPORTANT

5 5%

TOTAL 100 100%


ANALYSIS

The table shows that according to 30% of the respondents it is very important that the

size of the EMI is appropriate, 45% of the respondents think it is somewhat important,

20 % of the respondents said it is not so important while 5% of the respondents replied

that it is not at all important.

INFERENCE


Hence the table clearly shows that the majority of the respondents think it is somewhat

important for the EMI to be appropriate.


30%

45%

20%5%

Importance for size of the EMI

VERY IMPORTANTSOMEWHAT IMPORTANTNOT SO IMPORTANTNOT AT ALL IMPORTANT


7) IMPORTANCE OF DEVELOPMENT EXECUTIVE IN HDFC

BANK WITH REGARD TO PERSONAL LOAN ACCORDING TO

CUSTOMER

VARIABLES RESPONDENTS PERCENTAGE

HIGHLY SATISFIED 15 15%

SATISFIED 55 55%


NEUTRAL 20 20%

DISSATISFIED 10 10%

HIGHLY DISSATISFIED 0 0%

TOTAL 100 100%

ANALYSIS


The above table shows that out of 100 respondents,15 % of the respondents are highly

satisfied with the development executive of HDFC Bank, 555 are satisfied, 20% are

neutral while 10% are dissatisfied with the customer care and none are highly

dissatisfied..

INFERENCE

Development Executive is of immense importance in today’s world and a key tool for an

organization in order to gain new customers and boost up sales and market share.


Therefore, HDFC Bank should work towards the dissatisfied customerby regular

training to its employees or making the procedure more customer friendly.



4.5

15%

55%

20%

10%

Respondents on customer

HIGHLY SATISFIEDSATISFIEDNEUTRALDISSATISFIEDHIGHLY DISSATISFIED


SUMMARY OF FINDINGS

1. Most of the customers of the bank are satisfied, but there is a minority of

customers who are still looking for improvement.

2. The bank has strong customer relationship, whether it is customer service or post

sales service, HDFC Bank serves the customer well.


3. However the bank timigs are not very convenient for the customers. Hence,

flexible banking hours shoud be adopted to meet customers’ requirements.

4. When it comes to the processing fees & time , it shows mix response. More

customers would prefer a change in the. processing fees & time

5. The only draw back that HDFC bank has in compare to other banks is only

regarding the interest rates which is considered to be low in comparison to other


bank. While most of the banks charges high monthly installment for the

repayment of loan with compare to HDFC bank.

6. Enable customers to get personal loan easily and provide variety of other

banking scheme to the personal loan customer .



CHAPTER 5

SUMMARY AND CONCLUSION


5.1 SUMMARY OF LEARNING EXPERIENCE

My experience with HDFC Bank as a Business Develoment Executive during the three

months internship period has helped me to a great extent in dealing with customers and

with their tastes and expectations.

With the changing market scenario and increased competition, it is very important to

treat the customer as the king and to keep him happy When it comes to sales, customer

relationship plays a significant role. To cater to each customer is an art to learn. Having


gone through continuous interactions with customers and working for the sales team in

the bank, I have learnt that it is very important to understand the needs and

requirements of the customer and accordingly sell him the product.

Working with HDFC Bank was a good learning opportunity which enabled me to learn

about its wide range of products and services. The project has helped me to have an

understanding of customer requirements and of the service industry.


5.2 CONCLUSION AND RECOMMENDATIONS

Conclusion

It is important in today’s competitive world to create loyal customers and retain them.

Hence customer service is an area where every organization put emphasis on. The


quality of products along with the quality of services influences customers to choose a

particular bank.

HDFC Bank, as its punch line says, ‘we understand your world’, is the largest private

sector bank in India which has shown tremendous growth in the past couple of

years .It’s customer centric focus and aim to satisfy every customer with wide range of

products and services as mentioned in the report has helped the bank to have an edge

above its competitors.


Recommendations

1. The processing time which is now 10 days , must be reduce to 9 days ,so more and

more people can apply for the urgent loan for unforeseen calamities

2. Scheduling regular promotional activities like canopies, company visit etc. to know

the more and more people about the loan facilities based on their salary i.e. “Personal

Loan”.


3. More number of scheme is provided to the current salary holder cutomer with HDFC

Bank with different features .

4. Proper and general instruction about the product with latest changes and working

provides to the executive .

5. The interest rates made to be more liberal to cutomer to customer on the basis of

their salary and company profile .


6. The process of funding the loan needs to be more simple so that the customer can

understand the product according to their needs.

7. There should be more executive especially inbig and crowded branches in the main

part of the town.

8. Special schemes should be provided for small scale sector business employees as

well new package of offers and discounts should be provided for high network people



ANNEXURE

5.4 Questionnaire


1. Name ______________________________________

2. Age

20-30

30-40

40<


3. Gender

Male

Female

4. Marital Status


Married

Single

5. Net Take Home Salary Level

<Rs.15, 000

Rs.15, 000-Rs 30, 000

> Rs.30, 000


6. How important is it for an employee to greet you with a smile?

Very important

Somewhat important

Not so important

Not at all important


7. How important is the Easy monthly Installment to you?

Very important

Somewhat important

Not so important



8. How important are the bank Interest Rates according to you?

Very important

Somewhat important

Not so important



9. How important are the benefits and facilities provided by HDFC for personal loan to

you?

Very important

Somewhat important

Not so important



10. What is your level of satisfaction with respect to the executive services of the bank?

Highly satisfied

Satisfied

Neutral


Dissatisfied

Highly dissatisfied

11. What is your level of satisfaction with respect to customer care measures

undertaken by the bank?

Highly satisfied

Satisfied


Neutral

Dissatisfied

Highly dissatisfied


12. What is your level of satisfaction with respect to the quality of overall service

provided by the bank?

Highly satisfied

Satisfied

Neutral


Dissatisfied

Highly dissatisfied

13. What is your level of satisfaction with respect to special schemes offered by the

bank?

Highly satisfied


Satisfied

Neutral

Dissatisfied

Highly dissatisfied


14. What is your level of satisfaction with respect to the response time for grievance

handling?

Highly satisfied

Satisfied

Neutral


Dissatisfied

Highly dissatisfied

15. What is your level of satisfaction with respect to the tenure period for the loan

provided by the bank?

Highly satisfied

Satisfied


Neutral

Dissatisfied

Highly dissatisfied


FAQ

Qu.1 What are the benefits of having a Salary Account for my Personal loan?

Ans.1 You get preferred interest rates, priority processing and simpler documentation if

you have a Salary Account with HDFC Bank. This is taken into account at the time of


disbursal of the loan. You can pay through Standing Instructions to debit your HDFC

Bank account with the EMI amount

Qu.2 How much loan can I avail of?

You can avail of a loan from Rs 50,000/- to Rs 15,00,000/- depending on your income

and repayment capacity. You can club the income of your spouse if you wish to

increase your loan amount


Qu.3 How do I repay my Personal loan?

You pay the loan in equated monthly installments. The loan will be paid through post-

dated cheques or through Standing Instructions to debit your HDFC Bank account with

the EMI amount. Calculate how much you will repay each month

Qu.4 What security do I need to provide to obtain this loan?


To obtain the loan, there is absolutely no need to provide any security or collateral

Qu.5 What are the loan tenure options?

You can repay your loan over a period of 12 to 60 months

Qu.6 How long will it take for me to get my loan?


Once you submit your application form and supporting documents, we shall give

approval within 72 hours provided everything is in order. All loan approvals are at the

sole discretion of the bank.

Qu.7 Can I repay the loan earlier?

You can choose to repay your loan anytime after 6 months of availing the loan at a

maximum pre-payment penalty of 4% of the principal outstanding on your loan.


BIBLIOGRAPHY


BOOKS AND MAGAZINES

Marketing Management- Philip Kotler

India Today

In-house journals

Research Methodology


JOURNALS :

1. HDFC bank universe

2. Internal reports


3. Presentation material

4. Brochures

WEBSITES:


. 1. www.hdfcbank.com

2. www.google.co.in

3. www.icicibank.com

4. www.citibank.com

5. www.utibank.com


NEWSPAPERS

The Times of India

The Economic Times

Business Standard


Documents

Project Report on Personal Loan