INTRODUCTION

Banking, is the business of providing financial services to consumers and businesses. The
basic services a bank provides are checking accounts, which can be used like money to
make payments and purchase goods and services; savings accounts and time deposits that
can be used to save money for future use; loans that consumers and businesses can use to
purchase goods and services; and basic cash management services such as check cashing
and foreign currency exchange. Four types of banks specialize in offering these basic
banking services: commercial banks, savings and loan associations, savings banks, and
credit unions.
A broader definition of a bank is any financial institution that receives, collects, transfers,
pays, exchanges, lends, invests, or safeguards money for its customers. This broader
definition includes many other financial institutions that are not usually thought of as
banks but which nevertheless provide one or more of these broadly defined banking
services. These institutions include finance companies, investment companies, investment
banks, insurance companies, pension funds, security brokers and dealers, mortgage
companies, and real estate investment trusts.
Individuals rely on the financial services sector for chequing, insurance and other
services that are part of daily living; to hold their savings and provide their credit; and for
a range of other services. Businesses rely on the sector for a host of important services.
The nation's efficiency, competitiveness, depth of employment opportunities and quality
of life are enhanced by an effective financial services sector. Indeed, almost by definition,
an effective financial services sector is the hallmark of a modern economy.

History of financial services

United States: Gramm-Leach-Bliley Act
The term financial services became more prevalent in the United States partly as a result
of the Gramm-Leach-Bliley Act of the late 1990s, which enabled different types of
companies in the US financial services industry to merge. Critics of this act say the term
financial services attempts to make the unison of these operations sound natural, ignoring
the history of problems that have arisen from combining them, such as conflicts of
interest and monopolization

[citation needed]

. Others, noting that many of the restrictions

abolished by the Gramm-Leach-Bliley Act had never existed in other countries or had
been abolished earlier than in the US, say the term financial services is a natural one, in
long term use, which means nothing more than its constituent words
In the USA almost every company now which previously described themselves as a bank,
insurance company, or brokerage house, now describes themselves in some way as a
financial services institution. Allstate Insurance, for example, now provides CDs and
investment brokerage services. Bank of America offers full-featured brokerage products,
while E*TRADE has expanded into offering bank accounts and loans. Companies usually
have two distinct approaches to this new type of business. One approach would be a bank
which simply buys an insurance company or an investment bank, keeps the original
brands of the acquired firm, and adds the acquisition to its holding company simply to
diversify its earnings. Outside the U.S., e.g., in Japan, non-financial services companies
are permitted within the holding company. In this scenario, each company still looks
independent, and has its own customers, etc. This is essentially the style of Citigroup and
JP Morgan Chase.
In the other style, a bank would simply create its own brokerage division or insurance
division and attempt to sell those products to its own existing customers, with incentives
for combining all things with one company. This is the style of Washington Mutual and
Wells Fargo.

Commercial bank
A commercial bank is what is commonly considered a 'bank'. The term 'commercial' is
used to distinguish it from an 'investment bank', a type of financial services entity which,
instead of lending money directly to a business, helps businesses raise money from other
firms in the form of bonds (debt) or stock (equity). Major commercial banks include:

Private banking
The term private bank is simply a marketing term for a bank or a division of a financial
services company targeted towards wealthy individuals. Often it is used to describe
specifically the lending services targeted towards this group, such as large margin loans.

Investment Banks
Investment banks (capital market banks) underwrite debt and equity, assist company
deals (advisory services, underwriting and advisory fees), and restructure debt into
structured finance products. Prominent investment banks include:

Barclays Capital

Bear Stearns

Citigroup Global Markets (formerly Salomon Brothers)

Credit Suisse First Boston

Goldman Sachs

ING

JPMorgan Chase

Bank cards
3

Bank cards include both credit cards and debit cards. Bank Of America is the largest
issuer of bank cards.
American Express

Barclaycard

Capital One

Discover Card

HSBC

Intelligent Finance

MasterCard

Washington Mutual

VISA

Credit card machine services and networks

Companies which provide credit card machine and payment networks call themselves
"merchant card providers". These include:

US Bank

First Data Corporation

Heartland Payment Systems

Investment Services
Asset Management
Asset management is the term usually given to describe companies which run collective
investment funds.

Custody services
Custody services and securities processing is a kind of 'back-office' administration for
Financial services. Assets under custody in the world were estimated to $65 trillion at the
end of 2004. Firms engaged in custody services include:
4

The Bank of New York

Mellon Financial Corporation

State Street Corporation

Investors Bank and Trust

JPMorgan Chase

PNC Financial Services Group

Insurance related
Insurance Brokerage
Insurance brokers shop for insurance (generally corporate property and casualty
insurance) on behalf of customers. Significant companies in this sector of the financial
services market include:
Insurance Underwriting
Personal lines insurance underwriters actually underwrite insurance for individuals, a
service still offered primarily through agents, insurance brokers, and stock brokers.
Underwriters may also offer similar commercial lines of coverage for businesses.
Activities include insurance and annuities, life insurance, retirement insurance, health
insurance, and property & casualty insurance.
Reinsurance
Reinsurance is insurance sold to insurers themselves, to protect them from catastrophic
losses. Firms in this sector include:

Berkshire Hathaway

Lloyd's of London

Munich Re

Swiss Re

Intermediation or advisory services

Stock brokers (private client services) and discount brokers
Stock brokers assist people in investing, online only companies are called 'discount
brokerages', companies with a branch presence are called 'full service brokerages' or
'private client services. Some of these are:

A.G. Edwards

Ameritrade

INTRODUCTION TO INDUSTRY
Various services provided by Banks in India
Banks activities can be characterized
Retail banking,
Dealing directly with individuals and small businesses, and
Investment banking, relating to activities on the financial markets.
6

most banks are profit-making, private enterprises. However, some are owned by
Government, or are non-profit making.

Various electronic devices provided by banks

ATM Savings Bank

Channel ATM Bank

Working Capital Financing
Working capital products include both fund and non-fund based products. Fund-based
working capital products include cash credit, packing credit, short-term loans payable on
demand, inland/export bills discounting, export and import financing and subscription to
commercial paper. Non-fund based products include documentary credit and bank
7

guarantees.
General Conditions For Working Capital Facility For CBG Clients
Other Fund-based Products:
MIBOR Linked loans, Commercial papers (CPs), FCNR B loans, Debentures and cashflow gap finance are other types of loans available to corporate.
Structured Products
ICICI Banks Structured Products can be broadly classified into Securitization and
Structured Financing.
Securitization
Securitization involves financing of existing or future identifiable cash flows/receivables,
with limited/full recourse to the company, with over-collateral of 1.5 to 3 times and a
liquidity account equal to 3-6 months. The normal tenure would be between 3-7 years and
the amortization would mirror the cash flow profile of the securitized receivables.
Securitization results in better balance sheet management in terms of capital adequacy
ratio and debt equity ratio, shifting of credit risk for non-recourse structures, liquidity
support and better pricing. A brief outline of the various Securitization deals and their
structure, concluded by ICICI Bank are mentioned below:
Auto Loan Receivables
A pool of identifiable receivables satisfying the criteria specified by ICICI Bank are
purchased by ICICI Bank / Special Purpose Vehicle (SPV) for a consideration net of over
collateral. ICICI Bank appoints the originator as the Managing and Collection (M&C)
agent to collect the receivables under the contracts and deposit them in a Trust and
Retention (T & R) account. The trustee makes the payments on the due dates to ICICI
Bank from the T & R account.
Credit Card Receivables
A product designed to fund clients who have a high volume of credit card receivables by
discounting future credit card sales. A tight payment structure is created wherein ICICI
8

Bank recovers its dues by trapping the discounted proceeds directly from the Acquiring
Bank. Employee Housing Loan Portfolio Buyouts The portfolio of housing loans given
by a company to its employees is taken over by ICICI Bank with or without recourse to
the employer. Due to long tenure of loans, risk view is taken based on individual
employees and the property rather than the comfort that is derived from the employer.
The employer is appointed as M&C Agent and ICICI Bank obtains repayment on the pool
of securitized housing mortgages through direct salary deduction by the employer.
Fertilizer Subsidy Receivables
The transaction involves Securitization of existing receivables (due from the Government
of India as subsidy to the company upon sale of fertilizers by the company) and
hypothecation of all the Receivables that would arise in future which would be deemed as
sold as and when they arise. The receivables would be escrowed directly to ICICI Bank
through a collection account and the company would provide adequate instructions to the
Bankers in that regard. The company would also act as M&C (managing and collection)
agent for the transaction. Due to the untimely nature of the payments by the government
and the need to enhance the rating of the structure, liquidity support mechanism may be
required in the form of cash collateral or a standby Letter of Credit from an acceptable
bank.
Export Receivables
The export receivables of the company are purchased by an offshore SPV. The offshore
SPV issues pass through Certificates in the international capital markets to raise funds for
the purchase of the receivables. The payments under the export receivables from the
importers (international) are directly credited into the offshore proceeds account of the
company maintained in an international location. The investors receive the payments
directly from the offshore proceeds account of the company. Collateralized Loan
Obligations (CLOs) / Collateralized Bond Obligations (CBOs
A special purpose vehicle (SPV) can be created which purchases the illiquid loans and/or
debentures and issues securities (CLOs/CBOs) to investors. The cash flows from the
9

underlying assets are used to service the securities issued by the SPV. The structure
leverages on the pooling of large number of low to medium rated assets to raise funds at a
higher rating compared to the underlying assets. This pooling gives benefits of
diversification with respect to industries and creditors and hence the rating of the
securities can be higher than the underlying assets.
Structured Financing
Traditionally Corporate borrowing has been on the basis of strength or weakness of
balance sheet, with the credit quality of the borrower being the single most important
factor. But of late the borrowings are being closely linked to the value of the asset or the
revenue earning capability of the asset - by means of structured finance. Structured
financing involves a customized package from a lender to the borrower.
Dealer financing
Dealers of large corporate can be provided finance which can be either with a limited
recourse (on a first loss basis) to the corporate or based on the creditworthiness of the
dealer and its relationship with the manufacturer. The various structures are: Bill
discounting / Web-based financing with/without recourse, Cash credit / Demand loan
facilities, Financing for auto dealers with incentives for conversion into retail loans.
EPC Contract Financing
Corporate are provided assistance to finance the gap between the inflows and outflows of
the contract; and Performance guarantees and advance payment guarantees given on
behalf of the client to the Contractor/Owner.

Investment Monetization
A product designed to cater to the requirement of the business groups to streamline the
cross-holdings within themselves. A Trust would be set up which would acquire the intragroup cross holdings from the various companies in the group at current market prices.
To fund this, the Trust would issue Pass-through Certificates (PTCs) to ICICI Bank. The
10

take-out would be a put option with the identified holding company of the group where
ICICI bank could sell the PTCs to put-provider at a pre-determined price on a fixed date.
The security could be pledge of additional shares.
Trade financing (long term)
This product leverages on the long-term relationships those companies have with clients
or explicit off take agreements, which go a long way in reducing market risk for their
products. The company can access long term funds on the basis of these strong
relationships or agreements. The product can be structured as a long-term loan with
escrow of the receivables originating from supplies to these customers or as a
Securitization of these future trade receivables. Typically the quantum of these
receivables would be such as to provide a margin over the debt servicing during each
period. The customers would need to be instructed to directly pay the moneys into an
escrow account, which would be used for debt servicing or for payment against the future
receivables securitization. Depending on the past track record and the coverage provided
by the receivables, additional credit enhancements like cash collateral for a limited
amount may be specified.

Financial services provide by ICICI Bank

Transaction banking
Cash management
General banking
Trade finance
Treasury solutions
11

 Investment solutions
Capital market
Security management
International banking services
Agri business
Corporate finance

PUNJAB NATIONAL BANK

PNB India or Punjab National Bank of India was established by Lala Lajpat Rai in the
pre-independence India in 1895 in Punjab, with Lahore as its head office. Today it is the
second largest public sector bank in India. It was nationalized in 1969 along with 13 other
major commercialbanks.
PNB has over 4500 branches and offices bringing the Punjab National Bank to your
doorstep. Around 2400 offices come under the network of Centralized Banking Solution
or CBS. A need for centralized banking system prompted PNB to go computerized and
what followed was the establishment of CBS in Punjab National Bank branches in all the
leading cities like Delhi, Pune,Chennai, Mumbai, Ahmedabad, Chandigarh, Gurgaon,
Hyderabad, Jalandhar, Kolkata, Ludhiana, Noidaand Bangalore.
Internet Banking Services are provided to all customers in the CBS branches. A branch
and ATM locator is also available on the official website of Punjab National Bank. For an
overview of the annual report or the bank profile, the site can be resourceful.

PERSONAL BANKING
Savings Account - with specialized services to students and salary accounts
Current Account
Fixed Deposits - special or multi-benefit fixed deposits, Recurring Fixed Deposits
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(RFD) and flexi- RFD's

Credit schemes - housing or home loan, car loan and finance, personal and
professional loan, educational loan for higher education, loans against property
mortgage and credit cards
ATM cum Debit Card
Nomination facility

SOCIAL BANKING:
Specialized baking services for farmers and women in rural areas, and financial
assistance to small-scale industries (SSI's). For this, 31 specialized branches have been
allotted the task of providing finance to the SSI's.
CORPORATE BANKING:
Cash Management,
EXIM finance and Gold Card Scheme beneficial to exporters
Finance for Business or Trade.

OTHER SPECIALIZED SERVICES:

Debit cum ATM Card acceptable at 99270 merchant establishment across India
Internet banking or simply net banking services available for all CBS Branches
Online payment system for railway reservation or utility payment including
telephone, mobile, electricity, insurance and other bills
Forex services beneficial to both traders and NRI's
PPF Accounts for senior citizens

13

Various services provide by SBI to its customers

The Financial Services Business has a wide range of services. In addition to home loans
from SBI Mortgage, individual and business loans from SBI Equal Credit, and financial
products from SBI Lease, we offer settlement and consulting services and engage in the
agency business for financial products.
MARKET PLACE BUSINESS
A customized list of information based on individual needs helps customers make
intelligent decisions about loans from several financial institutions, insurance products,
and other financial services.
FINANCIAL PRODUCTS BUSINESS
Home loans and consumer loans are mainly provided through the Internet
Financial Research and Advisory:
Customers receive neutral information about investment trusts, assessment and ranking of
financial products, and investment in the Japan 401k pension plan.
Financial Solution Business:
Customers can find solutions that combine finance and information technology such as
online settlement infrastructure and online trading tools.
Other Business:
Other operations include insurance and home loan agencies, debt collection, and art
brokerage and sales.
Advance into Banking Business:
The SBI Group and The Sumitomo Trust and Banking are combining their management
resources to establish an Internet bank with full-fledged features, from settlement of
14

accounts and operations management to fund-raising.

HDFC Bank began operations in 1995 with a simple mission: to be a "World-class

Indian Bank". We realised that only a single-minded focus on product quality and
service excellence would help us get there. Today, we are proud to say that we are well on
our way towards that goal.

Various services provide by HDFC Bank to its customers

Credit Cards
Debit Cards
Prepaid Cards
Personal Loan
Home Loan
Two Wheeler Loan
New Car Loans
Loan against property
Commercial vehicle loan
Construction equipment
Net Banking
Mobile Business
ATM
Phone Banking
E-mail statement
Bill Pay
Visa Money transfer
Excise & Service Tax Payment, Mutual Fund, Insurance, Bonds, etc.

15

16

LITERATURE REVIEW
Finance and inequality: the case of India.
By Ang, James B.
Publication: Southern Economic Journal
Although the relationship between financial development and economic growth has been
extensively studied in the literature (see, for example, King and Levine 1993; Levine,
Loayza, and Beck 2000;Ang and McKibbin 2007), little is known about how finance
impacts income inequality. The importance of the finance-inequality relationship has
recently been highlighted in an insightful survey article by Claessens and Perotti (2007).
They indicate that while financial development can help reduce income inequality,
financial liberalization captured by established interests may do the opposite. (Banerjee
and Newman 1993; Galor and Zeira 1993; Aghion and BoRon 1997; Mookherjee and
Ray 2003, 2006). Given that theories provide ambiguous predictions regarding the effects
of finance on the distribution of income, it is useful to approach the issue at the empirical
level. This could facilitate our understanding of the relationship between finance and
inequality, and help us to assess the validity of each theoretical model.
Despite the important role of financial market frictions in the theories of poverty and
income inequality, researchers so far have not adequately addressed whether financial
development, and in particular financial sector policies, affect income inequality
(Demirguc-Kunt and Levine 2007). In this connection, there are two novel studies that
focus on examining the effect of financial development on income inequality. A more
recent study by Beck, Demirguc-Kunt, and Levine (2007) attempts to assess the impact of
financial development on changes in income distribution and income for the poor. Their
main findings indicate that financial development is associated with a lower growth rate
of the Gini coefficient and a higher growth rate of income for the poor. While these two
studies have established that financial development helps reduce income inequality,
studies examining the direct impact of financial liberalization on income inequality are
particularly scant (Demirguc-Kunt and Levine 2007). The limited indirect empirical
evidence, based on the survey by Arestis and Caner (2004), seems to suggest that
17

financial liberalization has ambiguous effects on the poor and income distribution.

The changing landscape of the financial services industry:

Publication: Economic Policy Review - Federal Reserve Bank of New York

The financial services industry has experienced significant changes over the past two
decades. Hundreds of banks have been consolidated, restructured, or newly formed. In
addition, deregulation of where banks can operate and what they can do has encouraged
both geographic and product diversification. The most recent aspect of this
transformation trend is the passage of the Gramm-Leach-Bliley (GLB) Act, which
loosens restrictions on banks' abilities to engage in the previously restricted activity of
underwriting securities and permits banks to underwrite insurance policies. We begin by
reviewing the consolidation trend that has occurred within the U.S. banking industry over
the past ten years. We explore reasons for the trend, focusing on the factors responsible
for the recent pick-up in its pace. Consolidation accelerated following the 1980s
deregulation of restrictions that prohibited bank expansion across geographic markets and
into other financial services.
We then test whether better diversification post-GLB can improve the risk-return tradeoff faced by financial companies. We do so by constructing hypothetical, pro-forma
mergers between bank holding companies (BHCs) and firms in each of the other three
major financial services industries: life insurance, property and casualty insurance, and
securities. The results suggest that, ceteris paribus, mergers between BHCs and life
insurance firms will produce firms that are less risky (and no less profitable) than those in
either of the two individual industries. . Similar to the analysis of stock returns, these
results point most strongly to combinations of banks and life insurance companies.
As a final step, we review how the financial services industry has evolved in Europe. A
European bank's ability to expand into other financial activities, unlike that of a U.S.
bank, is relatively unrestricted. Overall, our findings point to continued consolidation
among financial firms. Moreover, the recent elimination of barriers preventing banks
18

from engaging fully in securities underwriting and insurance will allow them to take
advantage of both diversification and economy-of-scope benefits as they expand into
these industries.

The deregulation of state-owned enterprises in India and China.

ByYang,Joy
Publication:ComparativeEconomicStudies
India and China have historically played an important role in the development of global
trade links. The impact of these two economies on the global economy declined as a
result of colonial competition. During the 1950s, the dominant ideology of their
governments was that the state play a pivotal role in these two economies.Over the last
twenty years, though, the presence of these two economies has grown commensurate with
their geographic size, partly as a result of the gradual opening of these economies to
global trade and mobile capital stock. Economies like India and China's have been
referred to as Big Emerging Markets (BEMs).
The deregulation of state-owned enterprises is one of the most obdurate hurdles faced by
transition economies as they adopt neoliberal structural adjustment policies. India and
China have begun a complex process of deregulation of its large public sector enterprises.
The process of deregulation began in the early 1980s in China. India's deregulation
program began a decade later once the central government removed most industrial
licensing requirements. In this article we will interpret deregulation broadly, primarily
because neither India nor China refer to their respective deregulation process as such,
opting instead for terms such as "disinvestment" or "public ownership".
The deregulation of public sector enterprises has often been accompanied in conjunction
with other economic liberalization measures. As such it has been one of the prominent
indicators of economic liberalization program in emerging markets.
The deregulation of state-owned enterprises has been a central tenet of the developmental
imperatives of these two countries and its success or failure is certain to alter the financial
relationship between them and the rest of the world. There are many objectives to
19

deregulation. First, deregulation is expected to improve the economic efficiency of stateowned enterprises. In addition to efficiency gains in the operation of firms, deregulation
is expected to increase competition between newly deregulated and private sector
industries. As such, deregulation is expected to benefit the consumer with a wider array
of goods and services at lower prices.

Article: Customer satisfaction in Indian banking:

Article from: Political Economy Journal of India
Author:

Kumar, Raj

The banking industry like many other financial service industries is facing a rapidly
changing market, new technologies, economic uncertainties,

competition and more

demanding customers and the changing climate.

(1). Banking is a customer oriented services industry, therefore, the customer is the focus
and customer service is the differentiating factors .
(2). The banking industry in India has undergone sea change since post independence.
More recently, liberalization, the opening up of the economy in the 90s and the
government's decision to privatize banks by reduction in state ownership culminated in
the banking reforms based on the recommendations of Narasimha Committee
(3). Banks have also started realizing that business depends on client service and the
satisfaction of the customer and this is compelling them to improve customer service and
build up relationship with customers. With the current change in the functional
orientation of banks, the purpose of banking is redefined. The main driver of this change
is changing customer needs and expectations. This change in customer attitude has gone
hand in hand with the development of ATMs, phone and net banking along with
availability of service right at the customer's doorstep. With the emergence of universal
banking, banks aim to provide all banking product and service offering under one roof
and their endeavor is to be customer centric
(4). With the emergence of economic reforms in world in general and in India in
particular, private banks have come up in a big way with prime emphasis on technical
and customer focused issues. The main contention of the author is to highlight the
20

customer satisfaction through service quality provided by the banks-SBI from the public
sector banking and ICICI from the private sector banking. Another contention is to
demonstrate the performance of the two banks SBI & ICICI in terms of customer
satisfaction.

PROFILING

OF

INTERNET

BANKING

USERS

IN

INDIA

USING

INTELLIGENT TECHNIQUES
Article from: Journal of Services Research
Author:

Ravi, V; Carr, Mahil; Sagar, N Vidya

Internet banking is a new delivery channel for banks in India. The Internet banking
channel is both an informative and a transactional medium. However, Internet banking
has not been popularly adopted in India as expected. The objective of this paper is to find
the profiles of Internet banking users as well as non-users using intelligent techniques.
This study investigates and identifies potential customers based on profiles of existing
users. The profiles may be used to target and attract potential customers to adopt Internet
banking.

21

CONCEPTUALISATION

A bank is a business that provides banking services for profit. Traditional banking
services include receiving deposits of money, lending money and processing transactions.
Some banks (called Banks of issue) issue banknotes as legal tender. Many banks offer
ancillary financial services to make additional profit; for example: selling insurance
products, investment products or broking. Currently in most jurisdictions the business of
banking is regulated and banks require permission to trade. Authorization to trade is
granted by bank regulatory authorities and provide rights to conduct the most
fundamental banking services such as accepting deposits and making loans. There are
also financial institutions that provide banking services without meeting the legal
definition of a bank.
Various services offered by banks
Taking deposits from their customers and issuing checking and savings accounts
to individuals and businesses
Extending loans to individuals and businesses
Cashing cheques
Facilitating money transactions such as wire transfers and cashiers checks
Issuing credit cards, ATM cards, and debit cards
Storing valuables, particularly in a safe deposit box
Cashing and distributing bank rolls
Storing valuables, particularly in a safe deposit box
Cashing and distributing bank rolls
Financial transactions can be performed through several different channels:
Branch
ATM
Mail
Telephone banking
Online banking

22

RESEARCH METHODOLOGY
Research is common refers to search for knowledge. It is the pursuit of truth with the help
of study, observation, composition and experiment.
Research methodology is a systematic way to solve the research problems. It helps in
studying the various steps that are adopted by the researcher to study the research
problems along with the logic behind the It describe mail what must be done, how will be
done. What data will be needed and how the data will be analyzed.

Scope of the study:

service scope: financial services provided by Banks to its Employer

23

STEPS FOR RESEARCH

STEPS

PROCESS OF RESEARCH

1.
DERFINING THE
RESEARCH PROBLEM
2.
REVIEW OF CONCEPTS
AND PREVIOUS RESEARCH FINDINGS

4.
RESEARCH DESIGN
F
E
5.

E
DATA

COLLECTION

B
A
C

6.
ANALYSIS OF
DATA
7.

INTERPRETATION

STEP WISE DESCRIPTION THE RESEARCH

24

Step 1. Formulating the research problem:

Objective of our study is to know about various financial services provided by various
banks to firms or companies. And also to know about how a bank satisfy its customers in
the todays competition era where employers analyze the most beneficial banks among
the companies.

Step 2. Review concepts, theories and previous research findings:

The researcher should go for literature survey connected with the problem. He should
consult journals, bibliography etc. the information of literature is collected from
academic journals, government report, book, library etc.
Step 3. Preparing the research design.
Research design is a conceptual framework within which research is to be conducted. The
functions or objectives of research design are to provided for collection of relevant
information
The research approach that has been selected for undertaking the assigned project is:
Exploratory and Descriptive
In exploratory research I will be covering:
Informal interviews with the industry experts.
Bank magazines.
Newspapers and books.
Step 4. Determine the sample design
The sampling methodology used is convenience and judgmental sampling.
30 companies (employers) taking financial services from banks.

OBJECTIVES OF THE STUDY

25

o To identify the various financial services provided by the bank to the

companies.
o To study the customers expectations regarding banks & its services.
o To make comparative study of different banks i.e.ICICI, HDFC, PNB, SBI
etc.
o To study the level of customer satisfaction regarding different banks.

26

DATA COLLECTION
. This research has been carried out in respect of four different banks. These are:
Public Bank (SBI & PNB)
Private Bank (ICICI, HDFC)
For the purpose of research study both primary data as well as secondary data has

been

collected.
oPrimary data
oSecondary data
Primary Sources:
Four data collection the following methods will be adopted:
(i) Questionnaires.
(ii) Personal Interviews.
(iii) Telephone Interviews.
Secondary Sources:
The secondary sources will be collected in the following formats:
Brochures
Books
Periodicals
Internet
Magazines
Websites
Analysis of data:
Collection of data is of use until it is properly recorded, organized and deeply analyzed.
Analysis of the data is done either manually or by the use of the computer. Various
statistical and mathematical techniques are used for data analysis.
Tools for Data Analysis:

Coding, Editing, Tabulation, Pie Charts & Bar Diagram.

Interpretation:
Collection is the last step in the research process in which theory or thesis is formulated
and final report.
27

JUSTIFICATION OF THE STUDY

To make a detailed study of various financial services provide by banks to the

companies in India.
To analyze companies view point regarding their banks.
To study effective and most popular bank among companies regarding its
services.
To find out the rate of interest of banks and reaction of companies on it.
To make analysis on the economic benefits provided by various banks.

28

FOCUS OF THE STUDY

This study related to the various financial services provided by banks to the
companies.
It shows that which bank is more economically beneficial for the companies.
This study shows how a bank satisfied its customers (companies)
It shows that how the companies make contact with the banks-personally or
electronically.
This study shows why a company take these financial services from its banks.
It shows which bank is more popular for its services.

29

LIMITATIONS OF THE STUDY

TIME CONSTRAINT: An in-depth project could not be carried out due to the
paucity of time
SMALL SAMPLE SIZE: A sample size of only 30 respondents was a small one
to understand the market behavior in whole.
LACK OF INTEREST: Many of the respondents did not think hard enough
while choosing the specific point. This could have led to a biased view and thus
affected the analysis.

30

DATA ANALYSIS AND INTERPRETATIONS

DO YOU TAKE ANY FINANCIAL SERVICES FROM BANK.

Table -4.1
Responses
YES
NO
Total

Respondents
80
20
100

Figure 4.1
Interpretation:
Maximum no .of companies and Firms take financial services from banks.
31

 Rest of the companies and Firms using their own funds for operations.

32

HOW DO YOU TAKE THESE SERVICES

Table -4.2
Services
ONLINE
PERSONALLY
Total

Respondents
55
45
100

Figure 4.2
Interpretation:
Most of the companies & Firms contact their bank from online (55%)
Rest of the companies & Firms contact their banks personally (45%)

ARE YOU SATISFIED WITH YOUR BANK.

33

Table 4.3
Responses
YES
NO
Total

Respondents
95
5
100

Figure 4.3
Interpretation:

A huge no. of companies & Firms is satisfied with the services provided by their
banks.

FROM WHICH BANK YOU TAKE YOUR SERVICES.

34

Table 4.4
Banks
ICICI
SBI
PNB
BOI
ANY OTHER
Total

Respondents
20
40
20
10
10
100

Figure 4.4
Interpretation:
Most of the companies & firms take its finance services from SBI.
Then is same ratio of PNB & ICICI.

WHICH BANK PROVIDES LOAN AT LOWER RATE OF INTEREST.

Table-4.5
Banks
ICICI

Respondents
15
35

SBI
PNB
BOI
Total

30
40
15
100

Figure 4.5
Interpretation:
PNB provides loan at lower rate of interest to its customers (companies).
Next one is SBI to provide finance at lower rate of interest.

WHAT KIND OF SERVIES DO YOU GET FROM YOUR BANK.

Table-4.6
Services
Credit
Custody
Insurance

Respondents
60
10
20
36

Advisory
Total

10
100

Figure 4.6
Interpretation:
Most of the banks provides credit facilities to their customers.
Then is insurance service which provided by banks.
Then is same ratio of custody & advisory services.

HOW OFTEN DO YOU TAKE SERVICES FROM BANKS.

Table -4.7
Time Period
Daily
Weekly
Monthly
Total

Respondents
10
30
60
100

37

Figure 4.7
Interpretation:
Mostly companies & Firms using financial services on monthly basis (60%)
Rest are taking these services on weekly and daily basis (30%&10%)

WHICH ONE IS ECONOMICALLY BENEFICIAL.

Table 4.8
Economically beneficial
Online
Personally
Total

Respondents
60
40
100

38

Figure 4.8
Interpretation:
Online banking is more economically beneficial for the companies (60%)

WHICH BANK PROVIDES YOU MAXIMUM SERVICES.

Table-4.9
Banks
ICICI
SBI
PNB
BOI
ANY OTHER
Total

Respondents
20
35
20
15
10
100

39

Figure 4.9
Large no. of companies takes financial services from SBI.
There is tough competition between PNB (public) & ICICI (pvt.)

ON WHAT BASIS DO YOU TAKE SERVICES FROM A PARTICULAR BANK.

Table 4.10
Basis of Services
ECONOMICAL
PROXIMITY
PROVIDES GOOD SERVICES
OTHERS
Total

Respondents
40
5
50
5
100

40

Figure 4.10
Interpretation:
Most of the companies/ Firms take financial services from their bank due to good
services provided by their banks
Other major factor to take the services is economic aspect of the bank.

41

FINDINGS

Maximum no .of companies and Firms take financial services from banks.

Rest of the companies and Firms using their own funds for operations

Most of the companies & Firms contact their bank from online (55%) and rest of
the companies & Firms contact their banks personally (45%).

A huge no. of companies & Firms is satisfied with the services provided by their
banks.

Most of the companies & firms take its finance services from SBI and then is
same ratio of PNB & ICICI.

PNB provides loan at lower rate of interest to its customers (companies) and next
one is SBI to provide finance at lower rate of interest

Most of the banks provides credit facilities to their customers and then is
insurance

service which provided by banks and then is same ratio of custody &

advisory services.

Mostly companies & Firms using financial services on monthly basis (60%) and
rest are taking these services on weekly and daily basis .

Online banking is more economically beneficial for the companies (60%).

Large no. of companies takes financial services from SBI and there is tough
competition between PNB (public) & ICICI (pvt.). Most of the companies/ Firms
take financial services from their bank due to good services provided by their
banks

Other major factor to take the services is economic aspect of the bank.

42

43

SUGGESTIONS
As the study shows that there is tough competition in banking sector so banks
should concentrate on different aspects to retain the existing customers as well as
attracting new ones.
Bank should be provided more electronic services which saves the precious time
of the customers(companies).
All the banks (public & pvt.) should improve the network coverage all over the
India.
The banks should make available the additional supplementary services like bank
cards, ATM, custody services.
Companies & Firms should consider all factors such as interest rate,
supplementary services, banks image etc.while taking decision for apply for
financial services to any bank.
Banks should try to build a good image in the service sector.

44

CONCLUSION

Credit is a necessary but not sufficient condition for the success of an urban informal
sector enterprise. Banks should do what they can to provide related services. In this
context, the work done by Canara and Syndicate Banks to establish Rural Development
and Self Employment Training Institutes (RUDSETIs), can be replicated even for urban
areas. In addition, attempts should be made to identify and direct infrastructure
investments and common facilities in areas where there is a possibility of servicing a
large number of urban informal sector producers such as handloom and handicraft
clusters and agro-processing zones
India needs an Apex Bank for Urban Development (ABUD) urgently to address many
issues of complexity in urban micro credit. Concluding the series, the following points
will thus help design an ABUD.
Conduct research and be a depository of knowledge related to urban micro
finance in India.
Train banks, NGOs, urban local bodies, and self help groups
Frame and steer national policy on urban micro credit
Act as a refinancing agency
Design programmes with feasible implementation structures

Monitor and evaluate both financial and social developments of urban micro
credit
45

 Coordinate the interests and functions of Indian and international stakeholders

46

BIBLIOGRAPHY
Primary Sources:
Questionnaires
Personal Interaction with staff members
Telephone Interviews
Mailing

Secondary Sources:
Internet
www.google.co.in
www.yahoo.com
www.answers.com
www.businesstoday.in
Some other Bank sites
State Bank of India
Punjab National Bank
HDFC Bank
ICICI Bank
Books
Kothari, C.R., Research Methodology,New Delhi, New Age International (P)
Ltd., 1985, 2004
Shekhar, K.C., Banking Theory & Practice,Vikas Publication, 9th Edition
Newspapers
Economic Times
47

Business Standard
Hindustan Times
Journals & Magazines
Business Today
Business & Marketing

48

QUESTIONNAIRE
I am Neha Genda student of MBA from Ganpati Institution of Technology &
Management. (GITM), Bilaspur affiliated to Kurukshetra University, Kurukshetra,. I have
assigned a topic Financial services of Banks to make our project report.
I am requesting you to help us in filling this questionnaire. The answer given by you
would be highly beneficial for our research report.

General information:
Name:

Age:

Company/Firm name:

Earnings:

Address:
Q.1 Do you take any financial services from bank?
Yes

NO

Q. 2 Which bank do you prefer for these financial services?

ICICI

SBI

PNB

BOI

OTHER(specify)
Q. 3 Which bank provides loans at lower rate of interest?
49

ICICI

SBI

PNB

BOI

OTHER(specify)
Q. 4 What kind of services you get from your bank?
Credit

Custody

Custody

Insurance

Advisory
Q. 5 Are you satisfied with the services provided by your bank?
Yes

No

Q. 6 How often do you take services from banks?

Daily

Weekly

Monthly

Q. 7 How you take these services?

Online

personally

Q. 8 Which one is more economically beneficial?

50

Online

personally

Q. 9 Which bank provides you maximum services?

ICICI

SBI

PNB

BOI

OTHER(specify)
Q. 10 On what basis do you take services from a particular bank?

Economical

proximity

Provides good services

others

Your Suggestions______________________________________________
____________________________________________________
_____________________________________________________
Signature

51