A PROJECT REPORT ON
PUNJAB NATIONAL BANKHOUSING FINANCE LIMITED
"Comparative Customer Preference in Public and Private Sector: Home Loans"
Submitted in Partial Fulfillment of the Requirement of Master of Business Administration (MBA)
Submitted by: Submitted to:Vipul Beniwal Mr Amit GuptaRoll No. 0221471708 Project Co-ordinatorMBA MAIMS
Maharaja Agrasen Institute of Management Studies (Affiliated to Guru Gobind Singh Indraprastha University)
ACKNOWLEDGEMENT
Success is an effort bounded actively, involving the co-operation of all.
To create and formulate this project report, I would be thankful to the entire individual who Served me as a true guide and epitome of knowledge.
I would like to thank Mr. AMIT GUPTA, MBA Project guide for anytime and every time guidance and continuous support. His experience and methodology of providing training helps me not to perform the desired activity but to accomplish creativity. I also like to thank my parents and my family members who are always a support for me.
In the last, but not least, Dr. N.K. Kakkar and other faculty members who are not only the source of inspiration but a constant motivation.
DECLERATION
I, Vipul Beniwal, here by declare that I have carried out summer training project on the topic "Comparative Customer Preference in Public and Private Sector: Home Loans" in Punjab National Bank.
I further declare that project work is my original work and no part of this report have been published to or submitted to anybody or university for award of any other degree or diploma.
Mr. AMIT GUPTAFaculty- MBA
TABLE OF CONTENT
1. NATIONAL HOUSING BANK
PROFILE OBJECTIVES BUSINESS/ACTIVITIES ORGANIZATION OFFICES PROCEDURE FOR AVAILING HOUSING LOAN
2. PUNJAB NATIONAL BANK
HERITAGE LOGIC OF THE LOGO PROFILE VISION & MISSION QUALITY POLICY ORGANIZATIONAL STRUCTURE CENTRALIZATION BANKING SOLUTION VARIOUS LOANS
3. ACHIEVEMENTS AND AWARDS
4. PNB SUBSIDIARIES
PNB GILTS LTD BACKGROUD OBJECTIVES PRODUCTS & SERVICES
5. PNB HOUSING FINANCE LTD.
INTRODUCTION PRODUCTS AND SERVICES
a. APNA GHAR YOJANA b. GHAR SUDHARYOJANA c. LOAN AGAINST PROPERTY d. LOAN FOR COMMERCIAL PROPERTY e. FUTURE RENTAL SCRUTIZATION f. LINE OF CREDIT FACILITY
BALANCE SHEET
6. RESEARCH METHODOLOGY
INTRODUCTION MEANING OF RESEARCH RESEARCH PROBLEM RESEARCH
DESIGN
7. COMPARATIVE STUDY
SAMPLE SELECTION SCOPE OF STUDY DELHI MARKET SEGMENT GRAPHS
8. CONCLUSION
SWOT ANALYSIS LIMITATIONS
9. APPENDIX
QUESTIONNAIRE BIBLIOGRAPHY
NATION HOUSING
BANK
PROFILE
The National Housing Bank (NHB) was established on 9th July 1988 under an Act of the Parliament viz. the National Housing Bank Act, 1987 to function as a principal agency to promote Housing Finance Institutions and to provide financial and other support to such institutions. The Act, inter alia, empowers NHB to:
» Issue directions to housing finance institutions to ensure their growth on sound lines
» Make loans and advances and render any other form of financial assistance to scheduled banks and housing finance institutions or to any authority established by or under any Central, State or Provincial Act and engaged in slum improvement and
» Formulate schemes for the purpose of mobilization of resources and extension of credit for housing
OBJECTIVES
NHB has been established to achieve, inter alia, the following objectives:
a. To promote a sound, healthy, viable and cost effective housing finance system to cater to all segments of the population and to integrate the housing finance system with the overall financial system.
b. To promote a network of dedicated housing finance institutions to adequately serve various regions and different income groups.
c. To augment resources for the sector and channelise them for housing.
d. To make housing credit more affordable.
e. To regulate the activities of housing finance companies based on regulatory and supervisory authority derived under the Act.
f. To encourage augmentation of supply of buildable land and also building materials for housing and to upgrade the housing stock in the country.
g. To encourage public agencies to emerge as facilitators and suppliers of serviced land, for housing.
BUSINESS ACTIVITIES
NHB, as the Apex level financial institution for the housing sector in the country, performs the following roles:
(a) Promotion and Development:
NHB operates as a multifunctional Development Finance Institution (DFI) for the housing sector. The Bank's policies are directed towards promotion and development of housing finance institutions. NHB has framed guidelines for HFCs with a view to promoting their development on sound and healthy lines. The guidelines are reviewed and modified from time to time in the light of developments in the financial and housing sectors. All HFCs registered with the National Housing Bank under sec. 29A of the National Housing Bank Act, 1987 and inter alia having minimum net owned funds of Rs.10.0 crores are eligible for refinance support. It has also contributed to the equity capital of five HFCs. NHB has a dedicated Training Division which organises regular training programmes in areas relating to housing and housing finance for development of management capabilities of officials working in the sector. NHB's promotional endeavours are also directed towards capacity building for the housing finance system besides enlarging the credit absorption capacity.
(b) Regulation and Supervision:
NHB exercises regulatory and supervisory authority over the HFCs in the matter of acceptance of deposits by them pursuant to the powers vested in it under the Act. As per the amendments to certain prov1.sions of the Act, which came into effect from June 12, 2000, NHB is vested with powers to grant Certificate of Registration to companies for commencing/carrying on the business of a housing finance institution. Besides, NHB regulates the deposit acceptance activities in accordance with the Housing Finance Companies (JHB) Directions, 2001, amended from time to time, in the matter of ceiling on borrowings (including public deposits, rate of interest, period, liquid assets, etc). NHB has also issued Directions on prudential norms in regard to capital adequacy, asset classification, concentration of credit, income recognition, provisioning for bad and doubtful debts etc. NHB supervises the working of HFCs through on-site inspection and off-site surveillance.
(c) Financing:
NHB raises resources for the housing sector towards increasing new housing
stock and provides refinance to a large set of retail lending institutions. These include scheduled commercial banks, scheduled state cooperative banks, scheduled urban cooperative banks, specialised housing finance institutions, apex co-operative housing finance societies and agriculture and rural development banks. Refinance is provided by NHB under various schemes, which are formulated taking into account, several aspects of the National Housing Policy, the constraints facing the sector etc. NHB has also a window for direct lending to Public Agencies such as, State Level Housing Boards and Area Development Authorities for large scale integrated housing projects and slum redevelopment projects. NHB is also operating a special window for extending financial assistance to the people affected by natural calamities viz. earthquake, cyclone etc.
(d) Resources of NHB
NHB raises resources from diversified sources, both domestic and external by Issuing Bonds/ debentures, borrowing from RBI and financial institutions/organizations etc. Under the Act, NHB is authorized to issue and sell Bonds with or without the guarantee of the Central Government for the Purpose of carrying on its functions.
(e) Rural Housing:
NHB launched the "Swarna Jayanti Rural Housing Finance Scheme" to mark the golden jubilee of India's Independence. The Scheme seeks to provide improved access to housing loans to borrowers for construction/acquisition/ Up-gradation of a house in rural areas of the country.
(f) Recent Initiatives
Securitization of mortgage loans of the retai11ending institutions facilitates for canalizing household savings into the housing sector is seen as a potentially viable market oriented alternative. Support to Mortgage backed securitization is a major policy initiative of the Government as manifested in its National Housing and Habitat Policy announced in 1998. This policy emphasizes NHB's lead role in mortgage-backed securitization and development of a secondary mortgage market in the country. As the apex body in housing finance sector in India, NHB has been
playing a lead role in the sector in matters relating to policy environment as also operational mechanism for the development of a secondary mortgage market in India.
In order to resolve the twin problems of affordability and accessibility affecting the growth of the housing finance business and the prospect of home ownership, NHB has been entrusted with the responsibility of launching a Mortgage Credit Guarantee Scheme for protecting the lenders against default.
ORGANISATION
NHB is an Officer Oriented Organization and has the following departments.
1. Regulation and Supervision
2. Board and CMD Secretariat
3. Legal
4. Information Technology
5. Enabling Processes
6. Resource Mobilization and Management
7. Refinancing Operations
8. Project Finance
9. Development and Risk Management
OFFICES
Head Office:
National Housing Bank Core 5A, India Habitat Centre, 3rd-5th floor, Lodhi Road, New Delhi - 110 003 Phone No - 011-24649031 - 35 FAX - 011-24646988,24649041
Regional Office:
National Housing Bank Mumbai Life Building, 45, Veer Nariman Road, Fort Mumbai - 400 023 Phone No - 22851560-64 FAX - 022-22851555
PROCEDURES FOR AVAILING HOUSING LOANS
• The appraisal officer attends to the queries of a prospective borrower. Various details. E.g., eligibility at al are discussed during this meeting.
• You collect the application form, which is generally available at the reception counter.
• You pay the processing fees, which is about 1% of the loan amount. The fees are non-refundable. Generally you are asked to pay the fees only if the chances of the loan getting sanctioned are really good as per the Officer's analysis.
• The date of the personal interview is fixed up as per mutual convenience. The appraisal Officer conducts the interview.
• The Appraisal Officer prepares the file and discusses the case with the Branch Manager. The Branch Manager should substantiate recommendations of the Appraisal Officer. The file is then recommended for sanctioning by the competent authority.
• The competent authority concerned sanctions the loan proposal. In case there are some queries, the same have to answer by the Appraisal Officer to the satisfaction of the sanctioning authority.
• If approved, you collect the Loan Offer letter. You fill Property Details form and Acceptance Note and sign the same. This signifies your acceptance of the proposal. Then, you are required to collect the disbursement within a month of the acceptance of the offer letter failing which a Commitment Charge of generally 1% on the loan is levied.
• The Legal and Technical fees is generally 1% of the loan sanction is paid by the borrower. The file is then transferred to the Legal department. You submit the legal documents to the Legal Officer. The Loan Agreement and the other documents are signed. The Legal Officer then prepares the Legal report after studying the legal documents in depth.
• The Technical Officer visits the property and submits the technical Report. The Technical officer as per the stage of completion recommends the amount for disbursement.
• The Disbursement Memo is prepared and is signed by the Appraisal, Legal and Technical Officers, and countersigned by the Branch Manager.
• The accounts department prepares the cheque which is then sent to the authorized signatories. The Disbursement Memo is attached with important
documents like interview sheet, Legal Report, Technical Report, PEMI Status Report applicable etc.
• The PEMI cheque of the amount disbursed is collected before releasing the disbursement amount cheque. PEMI is the interest charged on the amount already disbursed by the company
• Consequent to the final disbursement of the EMI starts which amortizes the interest and adjust the principle for the tenure allotted.
• The documents mortgaged are released on closure of loan.
PUNJAB NATIONAL
BANK
HERITAGE
Established in 1895 at Lahore, undivided India, Punjab National Bank (PNB) has the distinction of being the first Indian bank to have been started solely with Indian capital. The bank was nationalized in July 1969 along with 13 other banks. From its modest beginning, the bank has grown in size and stature to become a front-line banking institution in India at present.
A professionally managed bank with a successful track record of over 110 years.
Largest branch network in India - 4062 branches and 447 Extension Counters spread throughout the country.
Strategic business area covers the large Indo-Gangetic belt and the metropolitan centers.
Ranked as 323rd biggest bank in the world by Bankers Almanac (January 2006), London.
Strong correspondent banking relationships with more than 217 international banks of the world.
More than 50 renovv11ed international banks maintain their Rupee Accounts with PNB.
Well equipped dealing rooms; 20 different foreign currency accounts are maintained at major centers all over the globe.
Rupee drawing arrangements with M/s UAE Exchange Centre, UAE, M/s Al Fardan Exchange Co. Doha, Qatar,M/s Bahrain Exchange Co, Kuwait, Mis Bahrain Finance Co, Bahrain,M/s Thomas Cook Al Rostamani Exchange Co. Dubai, UAE, and M/ s Musandam Exchange, Ruwi, Sultanate of Oman.
LOGIC OF THE LOGO
Established in 1895 at Lahore, then undivided India, Punjab National Bank (PNB) has the distinction of being the first Indian bank to have been started solely with Indian capital. The bank was nationalized in July 1969 along with 13 other banks. From its modest beginning, the bank has grown in size and stature to become a front-line banking institution in India at present. It has more than 4000 branches and over 400 extension counters. Strong correspondent banking relationship, which it maintains with over 200 leading international banks all over the world, enhances its capabilities to handle transactions worldwide. More than 50 renowned international banks maintain their Rupee Accounts with PNB.
With its presence virtually in all the important centers of the country, PNB offers a wide variety of banking services which include corporate and personal banking, industrial finance, agricultural finance, financing of trade and international banking. The large presence and vast resource base have helped the bank to build strong links with trade and industry. At the same time, the bank has been conscious of its social responsibilities by financing agriculture and allied activities and small-scale industries.
The bank is committed to maintaining the highest standards of service and will be covering more offices under this quality movement titled 'Alliance with Quality'.
PROFILE
With its presence virtually in all the important centres of the country, Punjab National Bank offers a wide variety of banking services which include corporate and personal banking, industrial finance, agricultural finance, financing of trade and international banking. Among the clients of the Bank are Indian conglomerates, medium and small industrial units, exporters, non-resident Indians and multinational companies. The large presence and vast resource base have helped the Bank to build strong links with trade and industry.
Punjab National Bank is serving over 3.5 crore customers through 4062 branches and 447 extension counters - largest amongst Nationalized Banks. The Bank was recently ranked 21st amongst top 500 companies by the leading financial daily, Economic Times. PNB's attempts at providing best customer service has earned it 9th place among Indias Most Trusted top 50 service brands in Economic TimesA.C Nielson Survey. PNB is also ranked 368 amongst the top 1000 banks in the world according to "The Banker" London.
At the same time, the bank has been conscious of its social responsibilities by financing agriculture and allied activities and small scale industries (SSI). Considering the importance of small scale industries bank has established 31 specialised branches to finance exclusively such industries.
Strong correspondent banking relationship which Punjab National Bank maintains with over 200 leading international banks all over the world enhances its capabilities to handle transactions world-\vide. Besides, bank has Rupee Drawing Arrangements with 15 exchange companies in the Gulf and one in Singapore. Bank is a member of the SWIFT and over 150 branches of the bank are connected through its computer-based terminal at Mumbai. with its state-ofart dealing rooms and well-trained dealers, the bank offers efficient forex dealing operations in India.
The bank has been focussing on expanding its operations outside India and has identified some of the emerging economies which offer large business potential. Bank has set up representative offices at Almaty: Kazakhistan, Shanghai: China and in London. Besides, Bank has opened a full fledged Branch in Kabul, Afghanistan.
Keeping in tune with changing times and to provide its customers more efficient and speedy service, the Bank has taken major initiative in the field of computerization. All the Branches of the Bank have been computerized. The
Bank has also launched aggressively the concept of "Any Time, Any Where Banking" through the introduction of Centralized Banking Solution (CBS) and over 2000 offices have already been brought under its ambit.
PNB also offers Internet Banking services in the country for Corporates as wen as individuals. Internet Banking services are available through all Branches of the Bank networked under CBS. Providing 24 hours, 365 days banking right from the PC of the user, Internet Banking offers world class banking facilities like anytime, anywhere access to account, complete details of transactions, and statement of account, online information of deposits, loans overdraft account etc. PNB has recently introduced Online Payment Facility for railway reservation through IRCTC Payment Gateway Project and Online Utility Bill Payment Services which allows Internet Banking account holders to pay their telephone, mobile, electricity, insurance and other bills anytime from anywhere from their desktop.
Another step taken by PNB in meeting the changing aspirations of its clientele is the launch of its Debit card, which is also an ATM card. It enables the card holder to buy goods and services at over 99270 merchant establishments across the country. Besides, the card can be used to withdraw cash at more than 11000 ATMs, where the 'Maestro' logo is displayed, apart from the PNB's over 600 ATMs and tie up arrangements with other Banks.
QUALITY POLICY
• To effectively meet customers' requirements and endeavor to achieve total customer satisfaction.
• To gain consistent faith and confidence of customers and potential customers regarding the quality of services rendered.
• To pursue excellence through continuous improvement in all areas and to distinguish ourselves by the quality of our services.
• To achieve operational efficiency by attaining better productivity and profitability.
• To work and act in such a manner that all services rendered in due course of banking lead to excellence and improved credibility and image of the Bank.
ORGANISATIONAL STRUCTURE
Bank has its Corporate Office at New Delhi and 25 Zonal Offices which in turn supervise 48 Regional Offices under which the branches function. The delegation of powers is decentralised upto the branch level to facilitate quick decision making.
BOARD OF DIRECTORS Shri s.c. Gupta Chairman & Managing Director Shri K. Raghuraman Executive DirectorDr. K.V. Rajan RBI Nominee Director Shri P .K. N ayar Officer Employee Director Shri Mohan Lal Bagga Workmen Employee DirectorShri A.S. Agarwal Non Executive Director Dr. Harsh Mahajan Shareholder DirectorShri Mohanjit Singh Shareholder DirectorShri Prakash Agarwal Shareholder Director
CENTRALISED BANKING SOLUTION
Welcome to the new age of banking convenience with PNB.
PNB now brings to you Centralized Banking Solution (CBS). An inter branch networking and data sharing platform, which makes 'Anytime Anywhere' banking a reality. With over 1000 branches to be networked in the near future, the status of costumers is changing from 'Customer of the branch' to 'Customer of the bank'.
CBS- 'BENEFITS' TO CUSTOMERS
• Instant fund transfers • Cheques collection/deposit across cities. • Cheques can be deposited at the center where it is drawn . • Interconnected ATM's • Access of accounts through any CBS connected branch • SWIFT remittance facility • Instant generation of statement of accounts • PNB Prudent Sweep- Scheme for Saving Fund A/C Holders • PNB Smart Roamer- Scheme for Current A/C Holder (Sweep in and Sweep
out facility.
At present CBS facility is available in 1229 Service Outlets.
DIFFERENT TYPES OF LOAN PROVIDED BY PNB
• CONSUMER LOAN
Q. Who can avail Consumer Loan? A. Any Individual with a monthly income of minimum Rs.5000/-
Q. What type of consumer durable can be financed? A. New consumer durable such as Refrigerator, Television, Air conditioner, Micro-oven, Cooking Range, Washing Machine, Music System, Furniture, Personal Computer, etc.
Q. How the loan is disbursed? A. The amount of loan shall be paid directly to the supplier of goods along with the margin of the borrower.
Q. What will be the total loan amount? A. 90% of the cost of consumer durable, subject to maximum of Rs.l lac. However, the minimum amount of loan shall be Rs.I0000/-
Q. What is the repayment period? A. Amount of loan together with Interest shall be repayable maximum in 60 equal monthly installments.
Q. What is the rate of Interest charged? A. At present Interest rate is 15 % (min.). This is subject to change.
Q. Whether Interest applicable is at a flat rate or at reducing balances? A. Interest is charged on reducing balances.
Q. What formalities are to be completed for availing the facility? Performa Invoice of consumer durable(s) to be purchased. Proof of residence Proof of Income Details of guarantor.
• CARLOAN
Q Who can avail Car Loan? A. Individuals and Business Concerns.
Q Whether finance is also available for used cars? A. Finance is also available for purchase of used cars not older than 3 years.
Q How much loan can be availed under the scheme? A For individuals, loan amount shall be 25 times the Net Monthly Salary /Income, subject to maximum of Rs•7.00 lac or 80% of the cost of the vehicle whichever is less. In case of business concerns, loan amount can be need based and is not subject to any ceiling.
Q Whether the income of the spouse is also taken into account for determining the amount of loan? A Yes, income of the spouse can also be taken into account for determining the amount of loan. In such cases, the spouse shall stand a guarantor.
Q What will be the repayment period? A. Amount of loan together with interest shall be repayable maximum in 84 equal monthly installments. However, for old car, loan together with interest is to be repaid maximum in 60 equal monthly installments.
Q What is the rate of interest charged?A.
AMOUNT UNDER FLOATING RATE OF INTEREST OPTION (% p.a)
UNDER FINANCIAL BASKET
Upto Rs. 2 Lakh 12.25 11.75Over Rs. 2 Lakh and for professionals
12.75 11.75
Over Rs. 2 Lakh and for others
13.25 11.75
Q Whether interest applicable is flat rate or at reducing balance?
A. Interest is charged on reducing balance.
Q What formalities are to be completed for availing the facility?A. The following documents are required to be submitted:
Proforma Invoice of Car to be purchased. Proof of residence Proof of Income Details of guarantor.
• PROFESSIONAL LOAN
Q. Who is eligible to get loan under the scheme? A. The following categories of professionals are eligible to get loan under the scheme: • Persons already practicing or new entrants in various professionals, having licenses issued under Central or State Legislations . • Associations of persons engaged in a single profession provided that each member of such an association is qualified and duly licensed to practice in the profession; and • The qualified professionals will be required to produce a certified copy of the license for the record at the bank.
Q. What is the purpose for which advance is sanctioned? A. Loans under this scheme may be granted for the purpose of financing purchase of equipment used by the borrowers, business premises, construction, making alterations or renovation of business premises/nursing homes or for working capital requirements, in their professions.
Q. How many loans can be availed under this scheme? A. Amount of loan : Need based on merits within the overall permissible limits as under: Metro/ Urban S.Urban/Rural Area l. Medical practitioners 5.00 lac 10.0 lac 2. Other professionals 5.00 lac 5.00 lac 3. Margin: Nil up to Rs.25000/-. 25% Above Rs.25000j-
Q. What is the rate of Interest charged?Details Rate Of Interest (% P.a)Upto Rs. 2 Lakh & Working Capital 11.25Upto Rs. 2 Lakh & Term Loan 11.75Upto Rs. 10 Lakh for Medical Practitioners
11.75
Above Rs. 10 Lakh for Medical Practitioners
12.75
Others Working Capital 13.25Others Term Loan 13.75
Q. What will be the repayment period for the term loan? A. Repayment will be in equal monthly installments within the following periods:- Loans up to RS.50000/- 48 months· Loans beyond Rs.50000/- 60 months
Q. What is the procedure for disbursement of the loan? A. Payment will be made direct to the suppliers/ dealers. In case of construction of the premises, the loan may be disbursed in phases after verifying the end use in terms of the plan as also at the spot.
• EDUCATION LOAN
Q. What are the types of education for which education loans are given? A. Education loans are given for pursuing all types of education viz. general, professional, technical and vocational courses.
Q. Which costs are financed under the scheme? A. The scheme enables the needy students to meet the following costs for studies in India as well as abroad: admission fees, books & stationery, instruments required for the course, monthly fees, examination fees, insurance premium for policy on life of the borrowing student, caution deposit/ building fund/refundable deposit supported by bills/ receipts, expenses like study tours/ project work/ thesis etc. required to complete the course, boarding and lodging expenses, and travel expenses/ passage money including air fare for joining the course abroad.
Q. Who is eligible to get loan under the scheme? A. The following is the eligibility criteria for getting loan under the scheme: Indian nationals, in the age group of 16-40 years. For part time computer
courses, applicants in the age group of 16-45 years are eligible. Students who have scored pass marks in their last qualifying examination and
have secured admission in the courses mentioned above. The parents/ guardian should have regular source of income to the extent that
they are able to repay the loan in case of need/ unforeseen circumstances. Employed persons intending to better their prospects can also avai110an for
improving their educational qualifications and! or receive training in modern technology in India/ abroad.
Q. How much loan amount can I avail? A. This is co-related to expenses involved in taking up the course and the expected earnings after qualifying, subject to a maximum of: For studies in India: Rs. 7.50 lacs For studies abroad: Rs.15.00 lacs
Q. How much loan amount can I avail for pursuing part time computer courses? A. In case of part time computer courses, the extent of loan should not exceed Rs. 50,000/ - per annum or fee fixed by the particular institution (as per prospectus less concession, if any), whichever is less.
Q. What is the security required by the bank?
A. The following additional security in addition to the personal liability of the borrower is required: Loan up to Rs. 5.00 lacs: Co-obligation of either or both parent(s) or
guardian(s) and the LIC Policy for equivalent to the amount of loan. Loan above Rs. 5.00 lacs: Co-obligation of parent(s) or guardian(s) and
Collateral Security or third party guarantee acceptable to the bank equivalent to 100% of the amount of loan.
Loan above Rs. 5•00 lacs: Co-obligation of parent(s) or guardian(s) and Collateral Security or third party guarantee acceptable to the bank equivalent to 100% of the amount of loan
Q. What is the rate of interest charged in the loan?AMOUNT UNDER FLOATING
RATE OF INTEREST OPTION (% p.a)
UNDER FINANCIAL BASKET
Upto Rs. 4 Lacs 11.75 11.25Above Rs. 4 Lacs & Upto Rs. 15 Lacs
12.75 11.25
The Interest rates are subjected to change from time to time.
Q. What is the method of application of interest in the loan? A. The interest shall be charged at simple rate from the date of disbursement till the commencement of repayment of loan. Thereafter, compound interest is charged on reducing balance.
Q. When does the repayment of loan commence? A. Repayment "Will commence after two years of the completion of studies by the borrower or one month after his/ her getting employment, whichever is earlier.
Q. What is the repayment schedule? A. Principal and interest is repayable in 84 monthly installments.
Q. Is there any stipulation about ceiling on annual income of parents/ guardian? A. No, there is no stipulation of ceiling on annual income of the parents/ guardians.
• KRISHI CARD
Q. Can I raise loan under this scheme for activities other than Agriculture? A. Yes, for other rural household requirements such as education, consumable items, medical expenses, etc. up to 25% of the limit or Rs.25,ooo/- whichever is lower.
Q. Do I need minimum qualification to be eligible under the scheme? A. No.
Q. If I have 5 acre of un irrigated land, am I eligible under the scheme? A. Yes.
Q. Can I take the payment from the other branches also? A. Yes, but within the same district whereas the illiterate cardholders will avail the facility from the issuing branch only.
Q. Do I have to pay any additional fee/charge for withdrawing cash from other than the issuing branch? A. Yes, if you withdraw cash from the branch other than the issuing branch a commission @2% is charged and the same is deducted from the cash withdrawn.
Q. If I want to renew my Krishi Card what formalities are required? A. You should approach the issuing branch one month before the expiry of the card with a written request for the same.
Q. Is there any concept of the margin under the scheme? A. For limits up to Rs. 2,00,000/-, the margin requirements are nil. For limits above Rs.200,OOO/- up to Rs. 3,00,000/-, margin requirement is 10%.
Q. In case of loss of card/passbook what are the formalities? A. Inform the card issuing branch by quickest means and a new card is re-issued on payment of nominal charges of Rs.200/-.
Q. How do you work out the eligible limit? A. The limit is worked out on the basis of your total income from farm as well as non-farm activities, extent of land holding, acreage and average yield of crops grown, price realizations etc.
Q. How do I repay the amount raised against the card?
A. Aggregate credits into the account during the 12/18 months period as the case may be, should at least be equal to the maximum outstanding in the account. The cardholder will also have to maintain his/her cash credit account in credit balance for at least one week once a year. However, the consumption loan portion shall be adjusted within a period of three years. An the repayments/deposits by the cardholder shall be made at the card-issuing branch only.
ACHIEVEMENTS AND
AWARDS
SKOTCH Challenger Award for Change Management for the year 2005-06
Best IT User in Banking & Financial Services by NASSCOM in partnership "With
Economic Times Industry - 2004 Golden Peacock Award for Excellence in Corporate
Governance - 2005 by Institute of Directors
FICCI's Rural Development Award for Excellence in Rural Development - 2005
Skotch Challenger Award for Exemplary use of for becoming a pioneer in Public Technology Golden Peacock National Training - 2004 & by Institute of Directors 2005
National Award for Excellence in SSI Lending Ranked 2nd for 4 consecutive years – 2002, 2003, 2004 & 2005
Banking Technology Awards 2004 Runner up in Jointly Adjudged by IBA, Finacle & TFCI 'Best IT Team of the Year Award 2005'
Money Outlook Award - 2004 Runner up in 'Best Bank (public Sector) of the year Award' - 2005
Niryat Bandhu Gold Trophy for excellence in export performance for 3 consecutive years 2001, 2002 & 2003 by Organization (FlEO)
21st Amongst Top 500 Companies by the leading Financial Daily The Economic Times, June 2005
9th amongst India's Top 50 Most Trusted A.C Nielson Survey, The Economic Times
Service Brands
3rd Rank amongst Banking Sector in India The Bankers' Almanac, January 2006
323rd Rank in the World
368 amongst Top 1000 Global Banks The Banker, London July 2005
PUNJAB NATIONAL
BANK
SUBSDIARIES
PNB Gilts LTD
A Subsidiary of Punjab National Bank which was amongst the first ones to get the license for undertaking activities in the Government Security market, as a primary dealer in 1996. The company received ISO 9002 certification from British Standard Institution, making it as the first primary dealer in India to achieve this certification for its quality systems and procedures. This certificate has been granted to the company as a whole including its corporate and branch offices.
MISSION
BACKGROUND
In the year 1996 Reserve Bank of India introduced the system of Primary Dealers with a view to strengthen the institutional infrastructure of Government Securities market. Six entities were granted licenses of which PNB Gilts was one. The Company was established as a wholly owned subsidiary of PUNJAB NATIONAL BANK with an initial paid up capital of Rs.50 crores which is also the minimum capital requirement for a Primary Dealer.
0
100
200
300
400
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600
1996-1997 1997-98 1998-99 1999-2000 2000-01 2001-02 2002-03 2003-04
Series1
The net-worth of the Company has increased from Rs.50 crs to Rs.541.33 crs in a span of 8 years.
RBI, New Delhi, granted its certificate of registration vide its letter dated 10th February 1998, to carryon the business of a Non-Banking Finance Company. The Company decided to expand its capital base & came with an IPO of Rs.3.5 crore shares at an offer price of Rs 30/- per share aggregating Rs.105 crore in July :woo. This increased the paid up capital of the Company to Rs 135.01 crores and reduced the holding of Punjab National Bank to 74.07%.
OBJECTIVES
The objectives of the Company are in line with objectives laid down by RBI for the Primary Dealers:
Strengthen the infrastructure in the government securities market in order to make it vibrant, liquid and broad based.
Ensure the development of underwriting and market making capabilities for Government Securities.
Improve secondary market trading system, which would contribute to price discovery, enhance liquidity and turnover and encourage voluntary holding of Government securities amongst a wider investor base.
Become an effective conduit for conducting open market operations.
Besides the above, the Company has been pioneer in retailing of Government Securities contributing to a deep and broad-based market. The Marketing Department specifically caters to select segments viz. Provident Funds, Trusts, Regional Rural Banks, Co-operative Banks, Corporate & Individuals to create awareness and encourage healthy investment practices.
PRODUCTS & SERVICES
Being a primary dealer in the Government Securities Market the company undertakes more than 90% of its operations in Government Securities. The range of product and services offered by the company includes:
• Treasury Bills • Central Government Dated Securities• State Government Securities • PSU Bonds • Inter-Corporate Deposits • CSGL accounts • Money market instruments • Merchant Banking • Mutual Fund Distribution
In addition to the above, we also offer advisory services to our clients to manage the government securities portfolio.
The Company has well-defined systems and procedures. The Internal Control & Management systems are in place and are in accordance with the guidelines issued By the Regulatory Authorities.
The Company has a lean staff of 38 employees spread over the Country with 31 employees in the Head Office in New Delhi & rest in our branches at Mumbai, Chennai, Kolkata, Ahmedabad and Bangalore.
During the years the Company has emerged as a leading Primary Dealer in the country. We have to our credits ...
The first stand alone Primary Dealer to come with an IPO & get listed. The first PD to achieve ISO 9001:2000 certification. The first to obtain a PH rating from CRISIL for its short-term borrowing
program. At present the rating from CRISIL is for borrowing up to Rs 250 crore.
The company has achieved a turnover of Rs.116468 crores during 2003-2004, making it one of the largest debt traders in the country.
PUNJAB NATIONAL
BANK
HOUSING FINANCE
LTD.
INTRODUCTION
This is a wholly owned subsidiary of Punjab National Bank, is engaged in providing housing loans for purchase, construction and up gradation of a dwelling unit. The company offers Loans for construction or for purchase of house/flat from development authorities and also from private builders/ group housing societies as well as for renovation/ repairs .Company also provide finance for construction of residential projects. Loans to NRIs are also provided for purchase/ construction of house/ flat along with a resident/ non-resident co-borrower.
PRODUCTS AND SERVICES
• APNA GHAR YOJANA
• GHAR SUDHAR YOJANA
• LOAN AGAINST PROPERTY
• LOAN FOR COMMERCIAL PROPERTY
• FUTURE RENTAL SECURITISATION
• LINE OF CREDIT FACILITY
APNA GHAR YOJANA
We provide housing finance to individuals for construction or for acquisition/ purchase of house/flat from development authorities such as DDA/HUDA/PUDA/RHB etc. and also from private builders/groups housing societies. We consider enhancement in loan amount in the event of escalations in cost.
ELIGIBILITY: a) Individuals in permanent service or having their own business (Resident or non -resident). b) Age of the applicant should not be more than 60 years in case of service class and 65 years in case of businessman or self employed;
LOAN AMOUNT: a) Minimum loan amount would be Rs.50,000/- and maximum loan amount depends entirely on the repayment capacity of the borrower(s). b) Actual loan eligibility shall be on the basis of repayment capacity as determined be PNBHFL taking into account income, age, qualification and occupation. c) Income of borrower(s) j co-borrower(s) shall be clubbed together for calculation of loan eligibility / the level of finance in case of joint application
MARGIN: The borrower's contribution shall be minimum 20% of the total cost of project, including stamp duty and registration charges. INTEREST RATES: (Effective from 1.07.2006)
PERIOD FLOATING RATE OF 3-YEARLY FIXED
INTEREST(%) RATE OF INTEREST (%)
1-10 Years 9.00 10.5011 – 15 Years 9.25 10.5016 – 20 Years 9.50 1.50
SECURITY:Security for the loan is first charged by way of equitable/registered mortgage of the property to be financed and/ or such other collateral securities as may be necessary. Loans to allottees of flats/houses of development authorities or members of co-op. housing societies or reputed private builders can be considered on the basis of tripartite agreement and/or interim security. With respect to property under construction, interim security may be required. Collateral/interim security may be assignment of Life Insurance Policies, guarantees from sound and solvent guarantors, pledge of marketable shares and such other investments acceptable to PNBHF.
LOAN DISBURSEMENT: For outright purchase of house/flat, the loan amount will be paid in lump-sum to the vendor at the time of registration after satisfying that the borrower has paid/provided for the balance amount. For houses/flats under construction, the loan amount will be disbursed in stages based on the progress of construction. Disbursement win be made after the property has been technically appraised and all legal documentation has been completed. The borrower has to invest his proportionate share of the cost, prior to disbursement of loan.
The loan can be disbursed either in lump sum or installments according to the requirement of the development authority/society/ private builder.
LOAN REPAYMENT: Loan repayment shall normally be in Equated Monthly Installments (EMI) comprising of principal and interest over a maximum period of 20 years. The table below shows the EMI for a loan of Rs. 1,00,000/- at different rates of interest.
No. of Years
/Term of
9.00% 9.25% 9.50% 9.75 10.00 10.25 10.50 10.75 11.00 11.25
loan05
2076 2088 2101 2113 2125 2138 2150 2162 2175 2187
071609 1622 1635 1648 1661 1674 1687 1700 1713 1726
10 1267 1281 1294 1308 1322 1336 1350 1364 1378 1392
151015 1030 1045 1060 1075 1090 1106 1121 1137 1153
20900 916 933 949 966 982 999 1016 1033 1050
SPECIAL REPAYMENT PLANS In deserving cases, installments may be fixed in increasing/decreasing order or in lump sum or even linked to Life Insurance Policies, under PNB Housing Finances special repayment plans like: • Graduated repayment plan • Decreasing repayment plan • LIC linked repayment plan • Balance payment facility
GHAR SUDHAR YOJANA
Under "Ghar Sudhar Yojna", we make available housing finance to individuals for up gradation, renovation or repair of house/flat. It includes among others, internal & external repairs, water proofing, roofing, flooring, electrical, woodwork etc.
ELIGIBILITY: Individuals who are in permanent service or self employed or have their own business. Age of the applicant should not be more than 60 years.
LOAN DETAILS:
Loan Amount Minimum amount of loan is Rs. 50,000. Maximum amount of oan shall not exceed Rs. 10,00,000. Borrower's minimum contribution will be 25% of the estimated cost of repairs/renovations. Actual loan amount shall be calculated on the basis of repayment capacity of the borrower as determined by PNBHFL.
INTEREST RA.TES (With effect from 1.07.2006)
For loans upto Rs.10 Lakhs
Period Rate of Interest (%)
Upto 15 Years 11.25
For loans above Rs.10 Lakhs
Period Rate of Interest (%)
Upto 15 Years 11.00
Upto 10 YRS rate of interest is 9 %
SECURITY:Normally, the security for the loan shall be first charge by way of Equitable/Registered mortgage of the property. However, PNB Housing Finance at its discretion, can sanction a loan on the basis of: • Pari-passu/second charge in the case of Central/State Govt./Public Sector/Nationalized Bank employees and other similar bodies or • Other securities such as assignment of LIC policies (surrender value at least equivalent to the amount of loan), pledge of marketable shares and such other investments acceptable to PNBHF. Besides this, personal guarantee from sound and solvent guarantors may be asked for.
LOAN DISBURSEMENT: A loan will be disbursed in lump sum or in stages (not more than three) based on the progress of renovation/repair. Disbursement will be made after the property has been technically appraised and all legal documentation and other formalities have been completed. The borrower has to invest his share of the cost in full prior to disbursement of the loan. The borrower is expected to complete the repair/renovation within six months.
REPAYMENT: Loan repayment shall normally be in Equated Monthly Installments (EMI) comprising of principal and interest over a maximum period of 10 years.
No. of Years
Monthly reducing Balance (%)
9.00 9.25 9.50 9.75 10.00 10.25 10.50 10.75 11.00 11.25
18746 8757 8769 8780 8792 8804 8815 8827 8839 8850
24569 4580 4592 4603 4615 4627 4638 4650 4661 4673
33180 3192 3204 3215 3227 3239 3251 3263 3274 3286
42489 2501 2513 2525 2537 2549 2561 2573 2585 2597
52076 2088 2101 2113 2125 2138 2150 2162 2175 2187
61803 1815 1828 1841 1853 1866 1878 1891 1904 1917
71609 1622 1635 1648 1661 1674 1687 1700 1713 1726
81466 1479 1492 1505 1518 1531 1545 1558 1571 1585
91355 1368 1381 1395 1408 1422 1436 1449 1463 1477
101267 1281 1294 1308 1322 1336 1350 1367 1378 1392
LOAN AGAINST PROPERTY
We provide loans to individuals against mortgage of their existing residential immovable property situated in urban/semi-urban/metro centres. Finance would be made available for personal requirements of borrowers such as education, marriage of children, family function, foreign travel, medical expenses, furnishing the house, buying a computer or other consumer durables, etc. by mortgaging their existing immovable property.
ELIGIBILITY: Any individual having regular source of income can apply for the loan. Age of the applicant should not be more than 55 years.
LOAN AMOUNT: Minimum loan amount would be Rs. 50,0001-. Maximum Loan Amount would be 50 % of the market value of the property as certified by PNBHF's approved valuer OR actual loan eligibility as determined on the basis of repayment capacity of the borrower, whichever is less. In case other earning family members are offered as co-borrowers, their income can also be clubbed with that of the borrower for computation of eligible loan amount.
INTEREST RATES: (With effect from 1.07.2006) Interest rate for individuals will be 11.50% and for builders (floating rate) will be 12.00%
SECURITY: We shall require Equitable I Registered Mortgage of property against which loan is being sought. Guarantee of one/ two persons will be required as per existing guidelines of the company.
LOAN DISBURSEMENT The loan would be disbursed directly to the borrower in lump sum through his bank account. Disbursement will be made after the property has been technically and legally appraised and legal documentation has been completed.
LOAN REPAYMENT The loan would be repaid by way of Equated Monthly Installments (EMIs) consisting of principal and interest within a maximum period of 15 years. Repayment will commence in the month subsequent to the month in which loan has been disbursed.
LOAN FOR C0MMERCIAL PROPERTY
We provide loans to individuals against mortgage of their existing residential immovable property situated in urban/semi-urban/metro centers. Finance would be made available for personal requirements of borrowers such as education, marriage of children, family function, foreign travel, medical expenses, furnishing the house, buying a computer or other consumer durables, etc. by mortgaging their existing immovable property.
ELIGIBILITY:
Any individual having regular source of income can apply for the loan. Age of the applicant should not be more than 55 years.
LOAN AMOUNT: Minimum loan amount would be Rs. 50,000/-. Maximum Loan Amount would be 50 % of the market value of the property as certified by PNBHF's approved value OR actual loan eligibility as determined on the basis of repayment capacity of the borrower, whichever is less. In case other earning family members are offered as co-borrowers, their income can also be clubbed with that of the borrower for computation of eligible loan amount.
INTEREST RATE: (With effect from 1.07.2006) Interest rate both for individuals and builders will be 12.00%.
SECURITY: We shall require Equitable/Registered Mortgage of property against which loan is being sought. Guarantee of one/ twu persons "vill be required as per existing guidelines of the company.
LOAN DISBURSEMENT The loan would be disbursed directly to the borrower in lump sum through his bank account. Disbursement will be made after the property has been technically and legally appraised and legal documentation has been completed.
LOAN REPAYMENT The loan would be repaid by way of Equated Monthly Installments (EMIs) consisting of principal and interest within a maximum period of 10 years. Repayment will commence in the month subsequent to the month in which loan has been disbursed.
FUTURE RENTAL SECURITISATION
For the convenience of our borrowers, we have started innovative scheme wherein we provide loan against assured rental receivable for their owned property which has been let out to reputed/ govt. companies.
ELIGIBILITY: Property owners having properties at Metro/Urban/Semi-urban areas who have let out their properties to Public Sector Undertakings/Government/Semi_ government and reputed corporate, banks, financial institutions and multinational companies can avail loan against future rental receivable.
LOAN AMOUNT: Maximum Loan Amount would be 80 % of the total future rent receivable within the un-expired period of lease deed subject to a maximum period of 10 years. Loan amount will be restricted to a maximum of 80% of the market value of the property.
INTEREST RATE: (With effect from 1.07.2006) The rate of interest will be 11.50%.
MARGIN: Minimum contribution of the borrower would be 20% of the future rent receivable with the loan period.
SECURITY: We shall require Equitable Registered Mortgage of the property against the rental of which the loan is being sought.
LOAN DISBURSEMENT In case of purchase of the property, the loan would be disbursed directly to the borrower, in lump sum or as per demand there from. In case of construction, the loan would be disbursed in stages (maximum being 3) based on the progress of construction. Disbursement will be made after the property has been technically appraised and all legal documentation has been completed. Disbursement would be made only after borrower contribution has been invested in full.
LOAN REPAYMENT The loan would be repaid by way of Equated Monthly Installment (EMI) consisting of principal and interest within a maximum period of 10 years. Repayment will commence in the month subsequent to the month in which loan has been disbursed. In case of construction repayment will commence with effect from the month subsequent to the month in which last installment of loan is released and till the time Pre-EMI Interest will be charged.
LINE OF CREDIT FACILITY
We offer corporate bodies a special facility of Line of Credit (LoC) facility which facilitates Home Ownership among its employees. The scheme facilitates a company to build its human resource by providing financial assistance to its employees for owning a house. The company can also save the funds otherwise required for building accommodation for their staff. Employees when they get an accommodation oftheir choice would contribute a great deal towards building an organisation. The loans sanctioned are liberal and disbursements under this facility faster. Employees are assisted in every ways and need not take time off from work
for complying with various formalities. A LOC facility granted to a company can be utilised to give loans to their employees for the purchase, construction or extension of residential units anywhere in India. A company can apply in the prescribed Corporate Application Form available at our offices along with the information/documents mentioned in the application form. After a LOC is sanctioned and the offer accepted, disbursement will be made after completion of legal and technical formalities.
AMOUNT OF LOC A company can apply for an LOC under both the schemes based on the anticipated demand for housing loans from its employees within the next one year. When this LOC is fully utilized, the Company can apply for another LOC as and when additional demand for housing loans arises.
INDIVIDUAL LOANS UNDER THE LOC The maximum individual loan per employee is 80% to 90% of the cost of the dwelling unit subject to a maximum of Rs. 30 lacs. The amount of loan available for borrowers is the amount recommended by the company and as determined by PNBHF.
RATE OF INTEREST The company is requested to confirm our current applicable rate of interest. Interest is calculated on the basis of annual rests. PNBHF reserves the right to vary the rate of interest at any time in response to changes in money market conditions or if a levy, tax on interest or any other charge or burden is imposed or levied by any Government Authority.
FEES AND CHARGES (a) Processing and administrative fee is 1.5% of the LOC applied for and is payable at the time of submission of the application. (b) A commitment charge of 1% per annum on the undrawn amount of the LOC sanctioned is payable commencing six months from the date of acceptance of offer. (c) On prepayment of the loan, in part or fun, PNBHF might charge an early redemption charge of 2 % of the amount being prepaid.
LOAN REPAYMENT The company shall deduct the Equated Monthly Instalments (EMls) from the monthly salary of each of the employee borrowers and remit a consolidated cheque/draft of EMls comprising principal and interest. Pending final disbursement ofloan, interest on the disbursed portion of the loan caned Pre-EMI interest is payable every month from the date of each disbursement upto the date of commencement of EM!. The details on security, disbursement, repayment terms and commencement of repayment are given under respective types of LOC.
TYPES OF LOC
Our company offers LOC under the following two schemes:
LOC TO Under this scheme funds are provided to the company for onward lending to its employees.The security for the loan is mortgage of dwelling units financed and/or any other security as acceptable to PNBHF, including bank guarantee. Since the company is the borrower and the employees of the company obtain loans from the company, the LOC is a direct liability of the company.
_
LOC THRU
Under the scheme loans are sanctioned to individual employees nominated by a company with the company guaranteeing the loans. The security for the loan is a guarantee from the company and mortgage of dwelling units financed. Individual employees recommended by a company are the borrowers. Therefore, the company has a contingent liability to the extent of the guarantee provided.
LINE OF CREDIT TO Loan application can be made by a company which has an approved HBA scheme and is engaged in any business except in real estate promotion and development.
a) Period The terms of the LOC would be subject to the weighted average repayment terms offered by the company under its housing loan scheme for employees covered under this facility subject to a maximum term of 15 years.
b) Security The main security is mortgage of the dwelling units financed. Our company can also ask for a bank guarantee and/ or any other security as may be mutually acceptable. The title deeds may be held either by PNBHF or by the borrower company on behalf of PNBHF.
c) Disbursement Disbursement will be made to the company on the basis of a statement indicating periodic disbursements of housing loans made.
d) Repayment A company availing of an LOC would start paying Equated Monthly Insta1ments in the month following the month in which final disbursement of the LOC is made to the company. Pending final disbursement, the company is required to pay interest on the disbursed portion of loan, called Pre-EMI interest and is payable every month from the date of each disbursement up to the date of commencement of EMI. In the event of an employee's superannuation, resignation, discharge from services or death, the amount of the housing loan outstanding in his account shall immediately be repaid by the company to PNBHF.
LINES OF CREDIT THRU As stated in the foregoing paragraphs, loans will be sanctioned to individual employees nominated by the company.
(a) Period The loans availed under this scheme will be repaid in over a maximum period of 20 years or up to the age of retirement of the employees, \whichever is earlier.
(b) Security The LOC will be secured by mortgage of the dwelling units financed. The mortgage will be created by the deposit of the title deeds. The title deeds will be held by PNBHF. The repayment of the loan will also be guaranteed by the company. The Corporate Body will therefore have a contingent liability to the extent of the guarantee provided. The loan agreement shall be executed by the employee borrower and countersigned by the employer guaranteeing repayment. PNBHF might ask the employer company to provide any other security and execute any other documents as required in this behalf.
(c) Disbursements Disbursements to individuals under this facility will be made on the basis of the recommendation made by the company.
(d) Repayment The employer shall deduct loan installments from the employees salary and remit to PNBHF on a monthly basis. EMIs for individual employees would commence from the month following the month in which the loan is fully disbursed. Pending final disbursement, the individual is required to pay interest on the disbursed portion of the loan called Pre-EMI interest which is payable every month from the date of each disbursement up to date of commencement of EMI.
RESEARCHMETHODOLOGY
INTRODUCTION
The procedure adopted for conducting the research requires a lot of attention as it has direct bearing on accuracy, reliability and adequacy of results obtained. It is due to this reason that research methodology, which we used at the time of conducting the research, needs to be elaborated upon. Research Methodology is a way to systematically study & solve the research problems. If a researcher wants to
claim his study as a good study, he must clearly state the methodology adopted in conducting the research so that it may be judged by the reader whether the methodology of work done is sound or not.
The research method here includes:-
1. Meaning of research 2. Research problem 3. Research design 4. Sampling design 5. Data coIlection method 6. Data analysis and interpretation 7. Recommendations
Meaning of ResearchResearch is defined as "a scientific & systematic search for pertinent information on a specific topic. Research is an art of scientific investigation. Research is a systematized effort to gain new knowledge. It is a careful investigation or inquiry especially through search for new facts in any branch of knowledge. Research is an academic activity and this term should be used in a technical sense. Research corn prices defining and redefining problems, formulating hypothesis or
suggested solutions; making deductions and reaching conclusions to determine whether they fit the formulating hypothesis. Research is thus, an original contribution to the existing stock of knowledge making for this advancement. The search for knowledge through objective and systematic method of finding solution to a problem is research.
Research ProblemThe first step while conducting research is careful definition of research problem.
Research design A research design is the arrangement of conditions for collection and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedure. Research design is the conceptual structure within which research is conducted. It constitutes the blue print for the collection measurement and analysis of data. Research design includes an outline of what the researcher will do from writing the hypothesis and its operational implications to the final analysis of data.
A research design is a framework for the study and used as a guide in collecting and analyzing the data. It is a strategy specifying which approach will be used for gathering and analyzing the data. It also includes the time and cost budget since most studies are done under these two constraints.
Research design can be categorized as:
• Exploratory research • Descriptive • Diagnostic research • Experimental research
Sampling DesignSampling is necessary because it is almost impossible to examine the entire parent population (i.e. the entire universe) various factors such as time available, cost, purpose of study etc make it necessary for the researchers to choose a sample. It should neither be too small nor too big. It should be manageable. Data Collection Method After the sample has been taken the type of information to be sought was decided upon, the next step is to collect the data. As the data collected is to be the base of what we plan to find out, the relevant care should be taken that the errors in methods of collection of data involved are minimized. The factors of availability of time, cost and human involvement come to effect the reliability of the data collected. Broadly there are two types of data:
• Primary data • Secondary data
Secondary data means the statistics not gathered for the immediate study at hand but for some other data. It is the data collected by some one for purposes other than solving the problem being investigated. On the other hand primary data are generated in a study specifically designed to accommodate the data needs of the problem at hand.
ANALYSIS AND INTERPRETATION OF DATA AND RECOMMENDATIONS
The data collected in the aforesaid manner have been tabulated in condensed form to draw the meaningful result. The different techniques are adopted to analyze a data.
All the data and the material is arranged through internal resources and the last part of the project consist of the conclusions drawn from the report, a brief summary and recommendations and giving the final touch to the reports by stating a conclusion.
COMPARATIVE CUSTOMER
PREFERENCE ANALYSIS
IN HOME LOAN SECTOR
The title of this report is "COMPARATIVE CUSTOMER PREFERENCE ANALYSIS IN HOME LOAN SECTOR". The subject was chosen to gather information about the perception of people towards home loan / sector.
Marketing is essential for each and every organization for its successful operation. It forms the basis of all other functions.
Marketing is human activity directed at satisfying needs and wants through exchange processes.
Therefore marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering and exchanging products of value with others is an act or operation or service by which original project and the final consumers are linked together in between these two points i.e. producer and consumer. Hence every activity facilitating the movement of goods and services, including market and marketing research are covered under the term marketing.
Marketing of a product involves a variety of activities of which selling is merely one of them.
This project provided the important data regarding the demand and awareness of ICICI Banking home loan sector.
SAMPLE SELECTION
The universe of the study as mentioned below in scope of the project is kept to the people in Delhi city.
The sample size was chosen to be 100.
Sample was chosen based on Convenience method of sampling but all care was taken to make it more representative by including people of different occupation.
SCOPE OF THE STUDY
The present study was conducted by the researcher in Delhi covering some main and popular markets of Delhi because of constraints of time and money study could not be extended to other cities. As Delhi being a popular and among the good cities of India is a good market of financial products & also here customers of different classes like business segment, service segment, and professional segment are in excess. Since the report aims at finding the potential for financial products at Delhi itself taking into consideration certain limits and problems, the area was chosen on the basis of coverage of product no. of respondents.
DELHI MARKET SEGMENT The market of Delhi mainly comprises of the rural & urban people with population of around 15 million. The literacy rate is fairly high and there are around 65% males & 35% females.
This data clearly indicates the emergency of a middle class at Delhi. As is elsewhere, this class is the harbors of modern facilities. Apart from other contribution, it is this class for its money. These demands exhibits a vigilant customer & financial products have been on their toes to return them to pay the least if not attract the other ones.
Besides Delhi also boasts of a large financial market. It has an upcoming pharmacy distribution network & lots of Govt. institutions. There is increasing use of Cyber Cafe Internet & cable connection. The market size of the city is around 2 lacks, a significant chunk of which is occupied by the upcoming middle classes.
Besides, there is good number of industries. Apart from this, there are many management and engineering conege's and universities. The much roaming growth of such institutions shows the presence of many high nets worth individual is Delhi.
For the purpose of the study the respondents were selected from all corners of Delhi mainly popular colonies and for gathering information about the trends, demands & brands available in financial products.
The data was collected through questionnaires. The question consisted of 10 questions along with the information regarding the occupation of the respondent.
The number of respondents were kept to 100. The graphs of all the findings question wise are given below along with the tables of the data collected.
The question wise findings alee presented next
AWARENESS ABOUT HOME LOANS
YES
NO
Awareness about home loans PercentageYes 92No 8
INTERPRETATION
The above Pie chart depicts that 92% of total sample size is aware about the home loans and only 8% are unaware.
EASE OF GETTING HOME LOAN
EASE OF GETTING HOME LOAN
YES
NO
Ease Of Getting Home Loan PercentageYes 51No 49
INTERPRETATION
51% of the sample size finds easy to get the home loan while 49% finds it difficult The ratio is more or less same.
PREFERENCE OF TAKING HOME LOAN
PREFERENCE OF TAKING HOME LOAN
YES
NO
Preference of taking Home Loan PercentageYes 76No 24
INTERPRETATION
The above graph depicts that maximum percentage of the sample size prefers to go for home loan.
LOAN RECEIVED
LOAN RECEIVED
YES
NO
Loan Recieved PercentageYes 67No 33
INTERPRETATION
It has been found from the graph that 67% of the sample size has gone for the home loan.
BANK PREFERENCE
BANK PREFERENCE
ICICI
PNBHF
LICHF
HDFC
OTHERS
PREFERENCE OF BANK PERCENTAGEICICI 36PNBHF 18LICHF 10HDFC 35OTHERS 1
INTERPRETATION
The above graph depicts that only 18 % of the sample size has preferred to take home loan from PNB and maximum percentage of the sample size preferred to take home loan either from ICICI or HDFC and very few that is only one percent has the preference of other financial institutes.
PROVISION OF OPTIMAL/ECONOMICAL INTEREST RATE
PROVISION OF OPTIMAL/ECONOMICAL INTEREST RATE
ICICI
PNBHF
LICHF
HDFC
OTHERS
Provision Of Optimal/Economical Interest Rate
Percentage
ICICI 32PNBHF 24LICHF 13HDFC 27OTHERS 4
INTERPRETATION
The above graph shows that according to the 32 percentage of total sample size, ICICI provides the optimal/economical interest rate. The next preference is given to HDFC and PNBHFL has received the third preference for providing the optimal interest rate. And only 13 percent of the sample preferred LICHF.
SUITABLE EMI
SUITABLE EMI
ICICI
PNBHF
LICHF
HDFC
OTHERS
Preference of bank in case of suitability of EMI
Percentage
ICICI 32PNBHF 24LICHF 13HDFC 27OTHERS 4
INTERPRETATION
The above graph shows that according to the 32 percentage of total sample size, ICICI provides suitable EMI. The next preference is given to HDFC and PNBHFL has received the third preference for providing suitable EMI. And only 13 percent of the sample preferred LICHF.
LONG TERM PREFERENCE
LONG TERM PREFERENCE
ICICI
PNBHF
LICHF
HDFC
OTHERS
Long Term Preference PercentageICICI 27PNBHF 24LICHF 25HDFC 20OTHERS 4
INTERPRETATION
The above pie chart depicts that maximum number of people has preferred ICICI bank for long term loans and only 24 percent of sample size has given preference to PNBHF and only 4% has given preference to other financial institutes.
CUSTOMER FRIENDLINESS
CUSTOMER FRIENDLINESS
ICICI
PNBHF
LICHF
HDFC
OTHERS
Customer Friendliness PercentageICICI 26PNBHF 18LICHF 24HDFC 17OTHERS 15
INTERPRETATION
The above pie chart shows that maximum number of people finds ICICI more customer friendly than other banks.
PROMPT SERVICE
BANK PREFERENCE ACCORDING TO PROMPT SERVICE
ICICI
PNBHF
LICHF
HDFC
OTHERS
Prompt Service PercentageICICI 45PNBHF 13LICHF 23HDFC 14OTHERS 5
INTERPRETATION
ICICI bank has found to be quickest in sanctioning the loan among other financial institutes by maximum number of people.
POSITIVE ASPECT FOR SUCCESS OF PNBHF
Positive Aspect For Success Of PNBHF
Percentage
SALES PROMOTION & BRAND 25Customer Friendly Home Loan Schemes
35
Easy Sanctioning Of The Home Loans
10
Lower Interest Rates 15Lower Emi's 15
INTERPRETATION
The above graph depicts that customer friendly home loan schemes are the main aspect for the success of PNBHF.
LAGGING AREA
Lagging Area PercentageConfined Only In Urban Areas 12Non Effective Advertisements 78Delay In Processing 10
INTERPRETATION
The above Pie chart shows that Non effective Advertisement is the lagging area of PNBHFL in comparison to other home loan banks.
CONCLUSION AND
SWOT ANALYSIS
AND LIMITATIONS
SWOT ANALYSIS
STRENGTHS
• Brand name of Punjab National Bank (PNB) is established over the years.• Single window clearance - a single employee provides wide variety of
facilities to the borrower, minimizing the hassle of wastage of time. • Appraisal techniques are used. • Specialized software's are big assets. • There is no penalty for prepayment from borrowers own service.
WEAKNESSES
• High interest rates as compared to other housing finance institutions. • Top management takes large amount of time to approve high value
seeking loan borrowers. No publicity. • No marketing managers work, only through dsa's (direct sales agent). • People are not aware of wide variety of schemes offered by the company;
tend to think the company as only providing home loans. • There is the shortage of staff at almost all branches which does not ensure
easy addressable of the customers problems.
Delegation of authority and responsibility is not proper.
OPPORTUNITIES
• Special rates of interest are offered during exhibitions.• Special rates of interest can be introduced for employees of PSU'S &
reputed national or multinational companies'• Product life cycle is to be reviewed.• The growing category of the builders ensure that good, high value
& qualitative projects, providing them home loans with the new and innovative schemes can lead to over all development of the company.
THREATS
• The competition in market is very high due to the private players.• The rates of interest of other players are quite low. • Innovative schemes with horne loan from other players. • The processing process is quite slow which leads to low housing finance.
A fraud case involving 32 cases worth Rs.3 crores at the one branch of PNB Housing Finance Limited in year 2002 leads decreasing brand name.
LIMITATIONS OF THE STUDY
There are always present some limitations under which researcher has to work. Here following are some limitations under researcher had to work:
SAMPLE SIZE
The sample size surveyed was limited over 100 respondents which not may be fully representative of the universe. A large sample size could not be taken due to time & cost constraints.
NON - COVERAGE OF CERTAIN ASPECTS
There is wide range of perimeters affecting consumer behavior but only a few questions relating to those determinants have been endorsed in schedule.
TIME CONSTRAINT
We had limited time for conducting this survey report. In this short period of all the respondents had to be personally contacted for the purpose of survey & then their responses had to be analysed . So, some shortfalls may be present.
LIMITATIONS OF SAMPLING TECHNIQUES
Limitations & biasness of convenience & judgment sampling used in the present study to some extent.
MONEY
Available with the researcher also imposed a limitation on the comprehensive of this research.
APPENDIX
QUESTIONNAIRE
DEAR RESPONDANT,
AS A PART OF BBA (B&I) CURRICULUM, I AM CONDUCTING A STUDY ON "COMPARATIVE CUSTOMER PREFERENCE IN PUBLIC AND PRIVATE SECTOR: HOME LOANS". YOU ARE REQUESTED TO PLEASE COOPERATE BY PROVIDING RELEVANT INFORMATION. I ASSURE YOU THAT INFORMATION WILL KEPT CONFIDENTIAL AND WILL BE USED FOR STUDY PURPOSE ONLY.
THANK YOU YOURS FAITHFULLY PRIYANKA GUPTA
Q.1 DO YOU FIND EASY TO GET HOME LOANS? YES NO Q.2 DO YOU PREFER TO GO FOR A HOME LOAN ?
YES NO
Q-3 HAVE U EVER TAKEN A HOME LOAN? IF YES FROM WHERE
YES NO
Q.4 RANKS THE FOLLOWING BANKS, DEALING IN HOME LOANS ACCORDING TO YOUR PREFERENCES.
I.C.I.C.I PUNJAB NATIONAL BANK HOUSING FINANCE LIMITED. (PNBHFL) HDFC LIFE INSURANCE IN INDIA HOSING FINANCE
OTHERS
Q.5 ACCORDING TO YOU WHICH OF THE FOLLOWING BANKS PROVIDES OPTIMAL /ECONOMICAL INTEREST RATE?
ICICI PNBHFLHDFCLICHJOTHERS
Q.6 IN THE CASE OF SUITABILITY OF EMI, WHICH BANK WOULD YOU PREFER?
ICICI PNBHFL HDFC LICHF OTHERS
Q-7 IN CASE OF LONG TERM WHICH BANK WOULD YOU PREFER?
ICICI PNBHFL HDFC LICHF OTHERS
Q.8 IN CASE OF CUSTOMER FRIENDLINESS, WHICH BANK WOULD YOU PREFER? ICICI PNBHFL HDFC LICHF OTHERS
Q.9 IN TERMS OF SANCTIONING OF THE HOME LOAN, ACCORDING TO YOU WHICH BANK IS QUICKER? ICICI PNBHFL HDFC LICHF
OTHERS
Q.10 ACCORDING TO YOU, WHICH POSITIVE ASPECT IS PLAYING MORE SIGNIFICANT ROLE IN SUCCESS OFPNBHFL?
SALES PROMOTION & BRAND CUSTOMER FRIENDLY HOME LOANS SCHEMES LOWER INTEREST RATES LOWER EMI'S EASY SANCTIONING OF THE HOME LOAN
Q.11 IN COMPARISON TO OTHER HOME LOAN BANK ACCORDING TO YOU PNBHFL IS LAGGING IN WHICH PARTICULAR AREA. CONFINED ONLY URBAN AREAS UNEFFECTIVE ADVERTISEMENT DELAY IN PROCESSING
BIBLIOGRAPHY
www.pnbindia.comwww.pnbhfl.comwww.google.comwww.nhb.org.inwww.indiainfoline.com
