PROJECT REPORT

ON

Enhancing NRI business for IDBI Bank

A report submitted in partial fulfillment of course curriculum of Post-Graduate

Diploma in Management (2009 – 11)

Submitted by
UTKARSH TANDON

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 DECLARATION

I hereby declare that the project work titled ‘Enhancing NRI Business for IDBI Bank’
submitted by me as part of my Two-Years Post-Graduate Diploma in Management
course curriculum is an original work done by me under the able guidance of Mr. Neel
Lohit, General Manager, (Head-NRI Business & Financial Inclusion), IDBI Bank and the
same has not been submitted in the past as a project work anywhere.

(Utkarsh Tandon)

Countersigned by Project Guide-

Mr. Neel Lohit

General Manager
Head-NRI Business & Financial Inclusion

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 ACKNOWLEDGEMENT

One of the pleasant aspects of preparing a report is the opportunity to thank those
who have contributed to make the project completion possible.

I would like to thank IDBI Bank for giving me an opportunity to carry out my project
that is a part of my summer internship.

I am extremely thankful to my mentor, Mr. Neel Lohit, General Manager (Head-NRI

Business & Financial Inclusion) whose active cooperation & guidance during the course
of completion of project work helped me to formulate, redefine and implement a
practical approach and finish the project successfully.

I am thankful to the staff members of NRI Services department of IDBI Bank who were
always cooperative and provided me with the required information that helped me to
complete the project in time.

I am also thankful to all those seen and unseen hands & heads, which have been of
direct or indirect help in the completion of this project.

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 EXECUTIVE SUMMARY

IDBI Bank is one of India's leading public sector banks and 4th largest Bank in overall
ratings. RBI categorized IDBI as an "other public sector bank". It was established in
1964 by an Act of Parliament to provide credit and other facilities for the
development of the fledgling Indian industry. It is currently the tenth largest
development bank in the world in terms of reach with 1162 ATMs, 710 branches and
474 centers. In 1976, the bank’s ownership was transferred to the Government of
India. Although Government shareholding in the Bank came down below 100%
following IDBI’s public issue in July 1995, the former continues to be the major
shareholder i.e. 52.3%. During the four decades of its existence, IDBI has been
instrumental not only in establishing a well-developed, diversified and efficient
industrial and institutional structure but also adding a qualitative dimension to the
process of industrial development in the country. IDBI has played a pioneering role in
fulfilling its mission of promoting industrial growth through financing of medium and
long-term projects, in consonance with national plans and priorities.

Over the years, IDBI has enlarged its basket of products and services, covering almost
the entire spectrum of industrial activities, including manufacturing and services. IDBI
provides financial assistance, both in rupee and foreign currencies, for green-field
projects as also for expansion, modernization and diversification purposes. It was
accorded the status of principal financial institution for coordinating the working of
institutions at national and state levels engaged in financing, promoting, and
developing industries.

IDBI has provided assistance to development related projects and contributed to

building up substantial capacities in all major industries in India. IDBI has directly or
indirectly assisted all companies that are presently reckoned as major corporate in
the country. It has played a dominant role in balanced industrial development.

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IDBI has engineered the development of capital market through helping in setting up
of the Securities Exchange Board Of India (SEBI), National Stock Exchange Of India
Limited (NSE), Credit Analysis And Research Limited (CARE), Stock Holding
Corporation Of India Limited (SHCIL), Investor Services Of India Limited (ISIL),
National Securities Depository Limited (NSDL), and Clearing Corporation Of India
Limited (CCIL).

In April 1990, IDBI set up the Small Industries Development Bank Of India (SIDBI) as
wholly owned subsidiary to cater to specific needs of the small-scale sector.

In 1992, IDBI accessed the domestic retail debt market for the first time by issuing
innovative bonds known as the deep discount bonds. These new bonds became highly
popular with the Indian investor.

In 1994, IDBI Act was amended to permit public ownership up to 49 per cent. In July
1995, it raised over Rs 20 billion in its first Initial Public Offer (IPO) of equity, thereby
reducing the government stake to 72.14 per cent. In June 2000, a part of government
shareholding was converted to preference capital. This capital was redeemed in
March 2001, which led to a reduction in government stake. The government stake
currently is 51 per cent.

In August 2000, IDBI became the first all India financial institution to obtain ISO 9002:
1994 certification for its treasury operations. It also became the first organization in
the Indian financial sector to obtain ISO 9001:2000 certifications for its FOREX
services.

In 2006, IDBI Bank acquired United Western Bank in a rescue. Annasaheb Chirmule,
who worked for the cause of Swadeshi movement, founded Satara Swadeshi
Commercial Bank in 1907, and some three decades later founded United Western
Bank. The bank was incorporated in 1936, and commenced operations the next year,
with its head office in Satara, Maharashtra. It became a Scheduled Bank in 1951. In
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1956 it merged with Union Bank of Kolhapur, and in 1961 with Satara Swadeshi
Commercial Bank. At the time of the merger with IDBI, United Western had some 230
branches spread over 47 districts in 9 states, controlled by five Zonal Offices at
Mumbai, Pune, Kolhapur, Jalgaon and Nagpur.

VISION STATEMENT
"To be trusted partner in progress by leveraging quality human capital and setting
global standards of excellence to build the most valued financial conglomerate"

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 TABLE OF CONTENT
1. INTRODUCTION…………………………………………………………………………………………………….8
 NON-RESIDENT INDIAN (NRI)……………………………………………………………………..8
 OVERSEAS CORPORATE BODIES (OCBS)…………………………………………………….9
 NRI BUSINESS IN INDIA……………………………………………………………………………….9
 DETAILS OF PRIVATE TRANSFERS TO INDIA……………………………………………..10
 FACILITIES AVAILABLE TO NRI’s/OCB’s……………………………………………………10
 TYPES OF BANK ACCOUNTS FOR NRI's……………………………………………………..11
 PROCEDURE FOR OPENING A NON-RESIDENT (NRI) ACCOUNTS IN INDIA…13
 MAJOR BANKS OFFERING DIFFERENT TYPES OF ACCOUNTS TO NRI’S…….14
 ECONOMIC IMPACT OF REMITTANCES………………………………………………………14
 INTEREST RATES………………………………………………………………………………………15
 FOREIGN EXCHANGE DEPARTMENT OF RBI……………………………………………..17
 BORROWINGS FROM NRIs/PIOs BY INDIAN NATIONALS……………………………19
 PORTFOLIO INVESTMENT SCHEME (PIS)……………………………………………………20
2. RESEARCH OBJECTIVES……………………………………………………………………………………….21
3. RESEARCH METHODOLOGY…………………………………………………………………………………22
4. ANALYSIS…………………………………………………………………………………………………………….23
 STATE BANK OF INDIA………………………………………………………………………………23
 HDFC BANK………………………………………………………………………………………………26
 ICICI BANK……………………………………………………………………………………………….29
 CORPORATION BANK……………………………………………………………………………….32
 AXIS BANK……………………………………………………………………………………………….34
 IDBI BANK…………………………………………………………………………………………………37
5. FINDINGS…………………………………………………………………………………………………………….41
6. LIMITATIONS……………………………………………………………………………………………………….43
7. RECOMMENDATIONS…………………………………………………………………………………………..44
8. REFERENCES……………………………………………………………………………………………………….46

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 1. INTRODUCTION

Non-Resident Indians (NRIs) are basically the persons who are having some kind of
origin from India and presently staying outside the country. They can be seen across
the globe in a large scale and most of them are businessman or working for many
private as well as public sector organizations. It is understood that there are over 2.5
crores of NRIs/PIOs spread across the world in over 136 countries. NRIs are mostly
present in large numbers in big countries like Australia, USA, UK, Germany,
Switzerland, France etc. where there is a great scope for personal growth and career.
NRIs generally keep some kind of connections with their parent country and this
connection is basically atleast in the form of banking relationship where they remit
their foreign earnings through these financial institutions. The NRI Services desks in
the bank branches basically provide banking services to NRIs/ or there are many NRI
specific branches that cater to the needs of NRIs.

NRI Banking in India is maintained by banks that hold official Authorized Dealers’
license from the Reserve Bank of India. The financial budget for 2007-08 extends NRI
accounts to Regional Rural Banks (RRBs) as well.

Non-Resident Indian (NRI):-

The word NRI is used in various senses in different fields. In general, A Non-Resident
Indian (NRI) is an Indian citizen who has migrated to another country, a person of
Indian origin who is born outside India, or a person of Indian origin who resides
permanently outside India. Other terms with the same meaning are overseas Indian
and expatriate Indian.

A Person of Indian Origin (PIO) is usually a person of Indian origin who is not a citizen
of India. Such people are issued PIO Cards, which exempt them from many restrictions
such as visa and work permit requirements, along with certain other economic
limitations.

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For the purposes of availing of the facilities of opening and maintenance of bank
accounts and investments in shares/securities in India, Person of Indian Origin means
a citizen of any country other than Pakistan or Bangladesh, if
1. he at any time, held an Indian passport; or
2. he or either of his parents or any of his grandparents was a citizen of India by
virtue of the constitution of India or Citizenship Act, 1955; or
3. the person is a spouse of an Indian citizen or a person referred to in clause (1)
or (2) above

Overseas Corporate Bodies (OCBs):-

Overseas Corporate Bodies (OCBs) are bodies predominantly owned by individuals of
Indian nationality or origin resident outside India and include overseas companies,
partnership firms, societies and other corporate bodies which are owned, directly or
indirectly, to the extent of at least 60% by individuals of Indian nationality or origin
resident outside India as also overseas trusts in which at least 60% of the beneficial
interest is irrevocably held by such persons. Such ownership interest should be
actually held by them and not in the capacity as nominees.

NRI Business in India:-

The confidence of non-resident Indians in the Indian economy is reviving again. After
an outflow of $2 billion in 2008-09, NRI deposits have increased by nearly $3.7 billion
in the first four months of 2009-10, despite the volatile movements in the interest
rates.

According to the RBI, total NRI deposits had declined to $41.55 billion by end of March
2009 from $43.60 billion in April 2008. However, NRI fund inflows increased since
April 2009 and touched $45.33 billion till July 2009, as per the RBI's September
bulletin. Most of the NRIs deposits come through the Foreign Currency Non-resident
(FCNR) account and Non-resident External Rupee Accounts. As of July 2009, FCNR
deposits accounts for $14.16 billion ($13.21 billion in March 2009) and $25.22 billion
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($23.57 billion in March) in the NR(E)RA. Deposits under the NRO (Non-resident
Ordinary) account were also higher at $5.9 billion ($4.7 billion). As interest rates on
both FCNR and NR(E)RA are linked to the Libor (London Inter Bank Rate), Indian banks
find NRI deposits quite cheap when compared to local deposits. Most of the NRI
deposits which are flowing to South-based banks come from the Middle East.

Details of Private Transfers to India:-

(in USD Billion)

Inward
Local Withdrawals/
Total Private Remittance for
Year Redemption of NRI
Transfer Family
Deposits
Maintenance
2006-07 30.8 14.7 13.2
2007-08 43.5 21.9 18.9
2008-09 46.4 23.1 20.6

In USD
2001 2003 2005 2007 2008
(B)
Net
Private 12.8 16.3 20.5 27.9 40.7
Transfer
Net NRI
2.3 2.9 -0.9 4.3 0.1
Deposits

Source:- RBI Monthly Bulletin May 2010, ARTICLE- Developments in India’s Balance of Payments during
the Third Quarter (October-December 2009) of 2009-10 and April-December 2009

FACILITIES AVAILABLE TO NRI’S/OCB’S:-

 Maintenance of bank accounts in India.
 Investment in securities/shares of, and deposits with Indian firms/ companies.
 Investments in immovable properties in India.

TYPES OF BANK ACCOUNTS FOR NRI'S:-

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  Non-Resident (External) Rupee Accounts (NRE Accounts):-
NRIs, PIOs, OCBs are eligible to open NRE Accounts. These are rupee denominated
accounts. Accounts can be in the form of savings, current, recurring or fixed deposit
accounts. Accounts can be opened by remittance of funds in free foreign exchange.
Foreign exchange brought in legally, repatriable incomes of the account holder, etc.
can be credited to the account. Joint operation with other NRIs/PIOs is permitted.
Power of attorney can be granted to residents for operation of accounts. The balance
in the account is freely repatriable. Interest lying to the credit of NRE accounts is
exempt from tax in the hands of the NRI.

 Ordinary Non-Resident Rupee Accounts (NRO Accounts):-

These are Rupee denominated non- repatriable accounts and can be in the form of
savings, current, recurring or fixed deposits. These accounts can be opened jointly
with residents in India. When an Indian National/PIO resident in India leaves for taking
up employment, etc. outside the country, his bank account in India gets designated as
NRO account. Interest income, from NRO accounts is taxable. Interest income, net of
taxes is repatriable.

 Foreign Currency Accounts:-

Foreign Currency (Non –Resident) Accounts (Banks) (FCNR (B) Accounts) NRIs/PIOs are
permitted to open such accounts in US Dollars, Sterling Pounds, Japanese Yen,
Australian Dollars, Canadian Dollars and Euro. The account may be opened only in the
form of term deposit for any of the five maturity periods viz; (i) one year and above
but less than two years (ii) two years and above but less than three years and (iii)
three years and above but less than four years (iv) four years and above but less than
five years (v) five years only. Interest income is tax free in the hands of NRI until he
maintains a non-resident status or a resident but not ordinarily resident status under
the Indian tax laws. FCNR (B) accounts can also be utilized for local disbursements
including payment for exports from India, repatriation of funds abroad and for making
investments in India, as per foreign investment guidelines.

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  Resident Foreign currency (RFC):-
Citizen of India or persons of Indian origin who have been outside India for a
continuous period of not less than one year and have become resident in India on or
after 18/4/92 are eligible to maintain RFC accounts. This can be held singly or jointly
in the names of eligible persons. Accounts can be maintained in the form of savings
bank, current accounts, and term deposits. Cheque book & loans / overdrafts facility
is not permitted on RFC accounts. It is maintained in designated currency viz. USD,
GBP, EURO, JPY. The interest on this is payable in the designated currency.
Nomination facility is also available. Nominees can be residents or non-residents.
The entire amount of foreign exchange brought to India at the time of return to India
for permanent settlement as well as balances standing to the credit of NRE and FCNR
accounts at the time of return, income received on overseas assets in the form of
interest, dividends, sale proceeds of assets, pensions received from abroad etc. is
credited to RFC accounts. Funds in RFC accounts can be remitted abroad for any bona
fide purpose of the account holder or dependants. It can be used for making local
payments also.

The following accounts were applicable to NRIs prior to April 2002 which are presently
discontinued as per RBI.

 Non-resident (Non-reportable) Rupee Deposit Accounts (NRNR Accounts):-

This account could be opened by NRIs, PIOs and OCBs by transfer of freely convertible
foreign currency funds from abroad, or from NRE/FCNR accounts. Deposits can be
held jointly with a resident and can be for period from 6 months to 3 years, and can
be renewed further. The principal is non-repatriable; interest can be repatriated.
There is no income tax on the interest.

 Non-Resident (Special) Rupee Accounts:-

NRIs/PIOs have the facility to maintain bank accounts and undertake financial
transactions in India subject to certain exchange control regulations. In order to
simplify the procedures and to provide greater freedom to NRIs/PIOs for putting
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through financial transactions in India, NRIs and PIOs were permitted to open bank
accounts in India, which would be at par with rupee accounts, maintained by
residents. They could open Non-Resident (Special) Rupee Accounts with banks in India
which had the same facilities and restrictions as are applicable to rupee accounts
maintained in India by residents relating to repatriation of funds held in these
accounts and/or income/interest earned on them. The scheme provided that the
procedure for opening such accounts would be same as that of domestic accounts of
resident individuals.

Procedure for Opening a Non-Resident (NRI) Accounts in India:-

Many banks provide the facility to open an NRE/FCNR account from overseas, by
downloading the form from the website of the bank of their choice.
Generally, the account opening form must be accompanied by
• A passport copy,
• The visa or residence permit of the country the NRI is residing in, and
• A set of 2 photographs

The signatures on the form have to be verified by either officials at the Indian
Embassy or consulate in the country of his residence or the Notary public. In case the
particular bank has an overseas branch in the applicant’s city, documents can be
verified at that office.

The initial remittance must be sent along with the documents.

NRIs can empower a local citizen to operate their domestic accounts through a Power
of Attorney or a letter of authority. NRIs can appoint nominees, resident Indians or
otherwise, to their account.

Major banks offering different types of accounts to NRI’s:-

Axis Bank HSBC Bank Kotak Mahindra Bank
Bank Of Baroda ICICI Bank Oriental Bank Of Commerce

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 Canara Bank IDBI Bank Punjab National Bank
Central Bank Of India Indian Bank Standard Chartered Bank
Citibank Indian Overseas Bank State Bank Of India
Corporation Bank IndusInd Bank Union Bank Of India
HDFC Bank ING Vysya Bank United Bank Of India
ABN AMRO Bank Allahabad Bank Andhra Bank

Bank of India Bank of Maharashtra Centurion Bank of Punjab

Central Bank of India Karur Vysya Bank Ltd. UCO Bank

Dena Bank South Indian Bank Ltd. Vijaya Bank

Economic Impact of Remittances:-

Remittances and flow of funds from migrant workers to their home countries have
become a major source of resources in developing and emerging economies.
These remittances from NRIs and deposits maintained by them form a substantial
part (about 23%) of our external reserves. For some smaller economies they form
an even larger segment of external reserves. These remittances & deposits
contribute to the growth & development of the economy as more and more
capital is available which can be used for various beneficial purposes. The
foreign currency received can be lent in the international market which will earn
good amount of interest to the lender. Also, a good amount of commission can
be earned on exchanges. The loss which the institutions suffer in the event of
exchange of currency can also be minimized as foreign currency will be available
freely in the form of deposits. All these things lead to growth & profitability of
the business. Indirectly, it will generate employment in the economy because
the requirement of the manpower to serve the customers will increase when the
depositors will increase. It also helps in maintaining the Balance of payment.
Directly or indirectly, it is the economy of the country which is benefitted as the
money available will be used in favour of the economy only.

Interest rates:-

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The rate of interest of different banks on all accounts maintained by NRI’s is same.
Given below are the interest rates of HDFC Bank as on 1 st May 2010 which are
provided by these banks on different accounts.
NRE A/C
Savings Fixed Deposit
A/c
Period Interest Annualised rate Per
Rate Annum (compounded
3.5% PER quarterly)
ANNUM 1 Year to less than 2 2.77% 2.79%
Years
2 Years to less than 3 2.95% 2.98%
Years
3 Years to 5 Years 3.50% 3.55%

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NRO A/C
Interest earned on NRO Savings Account / NRO Fixed Deposit is subject to Tax
deduction at source*.W.e.f Aug 09, applicable TDS rates are:

Tax Education
NRO Surcharge Total
Rate Cess
Payment up to Rs 10 Lakh 30% - 3% 30.90%
Payment equal to and above Rs
30% 10% 3% 33.99%
10 lakh

Savings
Fixed Deposit(Below Rs.15 lakhs)
A/c
Interest Rate (per Interest Rate
Period Period
annum) (per annum)
7 - 14 days 2.25% 9 months 17 days -
5.75%
1 Year
15 - 29 days 2.25%
1 year 1 day - 1
30 - 45 days 3.00% 6.50%
year 15 days
46 - 60 days 3.50%
1 year 16 days 6.75%
61 - 90 days 3.75%
1 year 17 days - 2
6.50%
91 Days to less than years
4.50%
6 months 1 day 2 years 1 day - 2
3.5% 7.00%
6 months 1 day - 6 years 15 days
PER 5.50%
ANNUM months 15 days 2 years 16 days 7.25%
6 months 16 days 5.50% 2 years 17 days - 3
7.00%
years
6 months 17 days -
5.50% 3 years 1 day - 5
9 months 15 days 7.50%
years
9 months 16 days 6.00%
5 years 1 day - 8
7.50%
years
8 Year 1 Day - 10
7.50%
Years

FCNR

Period USD GBP Euro JPY AUD CAD

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 1 Yr to < 2 Yrs 2.02% 2.37% 2.22% 1.67% 6.50% 2.57%
2 Yrs to < 3 Yrs 2.20% 2.75% 2.43% 1.48% 6.42% 3.17%
3 Yrs to < 4 Yrs 2.76% 3.28% 2.74% 1.53% 6.61% 3.68%
4 Yrs to < 5 Yrs 3.25% 3.69% 3.05% 1.60% 6.85% 4.04%
5 Yrs only 3.66% 4.02% 3.33% 1.70% 6.96% 4.30%

RFC A/C

Period GBP USD EURO JPY

< 29 Days 0.65% 0.25% 1.00% 0.25%
30 days - 3 Months 1.25% 0.50% 1.25% 0.25%
3 Months 1 day - 6 Months 1.50% 1.25% 1.50% 0.25%
6 Months 1 day - < 1 Year 1.75% 1.75% 1.75% 0.25%
1 year - < 2 years 2.37% 2.02% 2.22% 1.67%
2 years - < 3 years 2.75% 2.20% 2.43% 1.48%
3 years only 3.28% . 2.76% 2.74% 1.53%

FOREIGN EXCHANGE DEPARTMENT OF RBI:-

With the introduction of the Foreign Exchange Management Act 1999, (FEMA) with
effect from June 1, 2000, the objective of the Foreign Exchange Department has
shifted from conservation of foreign exchange to "facilitating external trade and
payment and promoting the orderly development and maintenance of foreign
exchange market in India".
 The new Act has brought about structural changes in the exchange
control administration. Regulations have been framed for dealing with
various types of transactions. These regulations are transparent and
have eliminated case-by-case approvals.
 All current account transactions are free from restrictions except
• 8 transactions prohibited by the Government of India.
• 11 transactions which require prior permission of the Government
of India and

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 • 16 transactions on which indicative limits are fixed by the
Government and release of foreign exchange beyond those limits
requires permission from the Reserve Bank. All Regional Offices of
the Department have in turn been authorized to release exchange
for such transactions.
 For capital account transactions, the Reserve Bank regulations provide
for general permissions/automatic routes for investments in India by
non-residents, investments overseas by residents and borrowings abroad,
etc.
 The Department ensures timely realisation of export proceeds and
reviews, on a continuous basis, the existing rules in the light of
suggestions received from various trade bodies and exporters' fora.
 The Department collects data relating to forex transactions from
authorised dealers on a daily basis for exchange rate management and
on a fortnightly basis for monthly quick estimates of balance of
payments and quarterly balance of payments compilation.
 The Department lays down policy guidelines for risk management
relating to forex transactions in banks.
 The Department is also entrusted with the responsibility of licensing
banks/money changers to deal in foreign exchange and inspecting them.

 There is a "Standing Consultative Committee on Exchange Control"

consisting of representatives from various trade bodies and authorised
dealers which meets twice a year and makes recommendations for policy
formulation.
 With a view of further improving facilities available to NRIs and
removing irritants, the Department is also engaged, on an ongoing basis,
in reviewing and simplifying the procedures and rules

Borrowings from NRIs/ Person of Indian Origin by Indian nationals:-

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Reserve Bank of India has granted general permission w.e.f. March 30, 1999 to the
Resident Indian / proprietorship / partnership firms to avail of interest bearing rupee
loans from NRIs/PIOs on non repatriable basis. This permission is subject to
compliance with the following conditions,
1. The rate of interest of such loans should not exceed 2 percentage points over
the Bank Rate prevailing on the date of granting the loan.
2. The maturity period of the loan should not exceed 3 years.
3. The loan can be granted out of funds remitted from abroad in foreign exchange
through normal banking or out of NRE/FCNR/NRO/NRSR accounts maintained
with authorized dealers in India. The payment of interest /repayment of loans
should be made by credit to NRO/NRSR accounts of the Non Resident lender.
In case where the loan was granted out of funds held in NRSR account of the
lender, the repayment of loan or repayment of interest should be made by
credit to NRSR accounts of the lender.
4. The principal amount of the loan will not be repatriable.
5. The loan cannot be raised for the purpose of carrying out
agricultural/plantation activity or for purchase of immovable property
/shares/debentures / bonds or for re-lending.

Portfolio Investment Scheme (PIS):-

This is similar to the NRE/NRO savings a/c. The NRI can trade in the secondary stock
market with Repatriation (from NRE PIS a/c) and on non-repatriation basis(from NRO
PIS a/c). Demat a/c and Trading account is also mandatory after opening of PIS
account to carry out trading and maintain shares in demat form. The application of
PIS is to be submitted to a designated branch of an authorized dealer in India in the
prescribed form. Reserve Bank has authorized a few branches of each authorized
dealer to conduct the business under Portfolio Investment Scheme. NRIs will have to
route their applications through any of the designated authorized dealer branches
who have been authorized from Reserve Bank. The banks active in PIS business are
Axis, HDFC & ICICI Bank.
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20
 2. RESEARCH OBJECTIVES

NRI’s today are depositing their savings in India because of the attractive interest
rates & good opportunities in India as compared to the facilities in foreign countries.
Major banks in India are offering various facilities to NRI’s for depositing money in
various accounts.

This study is thus conducted to find out the various services, market share and the
strategies adopted by some of the major players in this field like SBI, HDFC, ICICI,
Corporation Bank, Axis and comparing the results with IDBI Bank with the motive to
find out various gaps in the NRI business of this bank and then giving suggestions for
attracting more and more NRI’s to deposit in this bank.

This report highlights total NRI business in India, the benefits and various accounts
which can be opened by NRI’s and the competition among various banks on the basis
of services provided, the competition faced by IDBI Bank & various recommendations
for attracting more and more NRI’s has been covered.

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 3. RESEARCH METHODOLOGY

In order to achieve the objectives of the research, the information is collected from
various sources, major part being the internet. Various types of accounts, interest
rates and other facilities of the banks are considered. Various rules and regulations of
RBI, FEMA concerning this have also been found through the same mode.

Apart from this, visit to the corporate offices and the branches of these banks were
made from time to time in order to extract the information regarding the facilities &
strategies. This was only possible after interaction with the NRI Department of all
these banks.

The guidance of the mentor as well as the employees was taken on regular basis to
find out various facts and correlate the findings in the event of research.

Also, various books were referred to develop the concept.

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 4. ANALYSIS

In this part, the comparison of the major banks like SBI, HDFC Bank, ICICI Bank,
Corporation Bank, Axis Bank and IDBI Bank is made on the basis of the various
accounts & sub-accounts and the services which are associated with each of these
accounts. Also, a brief summary on the market share, strategies adopted,
international presence and other outstanding benefits are covered to get clear
distinction.

STATE BANK OF INDIA

SBI provides a range of banking products through its vast network in India and
overseas, including products aimed at NRIs. The State Bank Group, with over 16000
branches, has the largest branch network in India. With an asset base of $260 billion
and $195 billion in deposits, it is a regional banking behemoth. It has a market share
among Indian commercial banks of about 20% in deposits and advances, and SBI
accounts for almost one-fifth of the nation’s loans. The bank has 131 overseas offices
spread over 32 countries as on 31st Dec 2009. It has branches of the parent in
Colombo, Dhaka, Frankfurt, Hong Kong, Johannesburg, London and environs, Los
Angeles, Male in the Maldives, Muscat, New York, Osaka, Sydney, and Tokyo. It has
offshore banking units in the Bahamas, Bahrain, and Singapore, and representative
offices in Bhutan and Cape Town.
The various types of accounts options at SBI are-
1. NRE [ Non-Resident External ] Account:-
The various types of account in NRE A/c are:-
 Savings A/C
 Current A/C
 Term Deposit
 Special Term Deposit
 Recurring Deposit

23
The various types of benefits in different accounts include Multi-city cheque book,
Internet Banking, Inter-national Debit card, Safety, Liquidity, Premature withdrawal,
Transferability, Timely Payment of Interest, Automatic Renewals, Flexibility etc.
ATM GOLD DEBIT CARD:-This card is available to all NRI customers with minimum
quarterly balance of Rs.50000. It is free of cost and zero annual maintenance charges.
Savings A/C Current Term Special Recurring
A/C Deposit Term Deposit
Deposit
Min Bal Rs.1000 Low Rs.1000 Rs.1000 Invest a fixed
Personal O/D 1 to 5 1 to 5 years sum monthly
Banking- facility years Interest and draw the
MCC Rs.5000 YES, Rs.3 Interest compounded total amount
YES, Rs.3 per leaf paid every with interest on
per leaf Limit quarterly quarter maturity
Internet Limit 2lakh 2lakh
Banking YES YES
Inter- YES
national YES YES
Debit card

2. NRO [ Non-Resident Ordinary ] Account:-

The various types of account in NRO A/c are:-
 Savings A/C
 Current A/C
 Term Deposits
 Recurring Deposits

24
 Min Bal Rs.1000
Facilities Multi-City Cheque, International Debit Card &
Internet banking

3. FCNR [ Foreign Currency Non-Resident (B) ] Account:-

Currencies Acceptable US dollar, Euro, Sterling, Pounds, Canadian dollar,

Australian dollar and Japanese Yen.
Min Deposit USD 1000 or equivalent, minimum of 1 year and a
maximum of 5 years
Facilities Nomination facility (can be a resident Indian),
International Debit Card & Internet banking.

4. RFC [ Resident Foreign Currency ] Account:-

The various types of account in RFC A/c are:-
 Savings A/C
 Current A/C
 Term Deposits
Currency Acceptable Maintained in US$ but withdrawal only in Indian
currency i.e. rupees
Min Deposit Term deposits can be maintained from 1 to 3 years
with minimum 1000 US$

SBI is the first bank to launch NRI services. It holds approximately 25% market share of
total NRI business. It is due to its mutual trust among people and being the largest
public sector bank. It is present in 30 countries & has 70 foreign offices, making its
presence all over the world. The transfer charges are less as compared to other

25
banks. They do not go for any advertisement which focuses especially on the NRI
services.
HDFC BANK
HDFC Bank is a major Indian financial services company based in Mumbai,
incorporated in August 1994, after the Reserve Bank of India allowed establishing
private sector banks. The Bank was promoted by the Housing Development Finance
Corporation, a premier housing finance company of India. HDFC Bank has 1,412
branches and over 3,295 ATMs, in 528 cities in India, and all branches of the bank are
linked on an online real-time basis. As of September 30, 2008 the bank had total
assets of INR 1006.82 billion. For the fiscal year 2008-09, the bank has reported net
profit of Rs.2244.9 crore, up 41% from the previous fiscal.
The various types of accounts options at HDFC Bank are-
1. NRE [ Non-Resident External ] Account:-
The various types of account in NRE A/c are:-
 Savings A/C
 Current A/C (Ideal for ESOP’s)
 Fixed Deposit

Savings A/C Current A/C Fixed Deposit

Min Bal Rs.10,000(Urban) Rs. 10,000, Initial Deposit:

Rs. 5,000 (Semi- Rs. 25000-Average Rs. 25,000,
Urban) Quarterly Add-on
Cheque Book Yes, FREE Yes, FREE Deposits: Rs.
Internet Yes Yes 10,000
Banking Min 1 year to
Inter-national Yes, Rs.100 issue Yes, Rs.100 issue & Max 5 years
Debit card & maintenance maintenance fees No,
fees No cheque book
Up to Rs.50000-NIL
Transfer Fees
Above Rs.50000-0.40 per 1000
& Charges
2. NRO [ Non-Resident Ordinary] Account:-
The various types of account in NRO A/c are:-
 Savings A/C
26
  Current A/C(Ideal for FCB’s)
 Fixed Deposits

Savings A/C Current A/C Fixed Deposit

Min Bal Rs.10,000 (Urban) Rs. 10,000, Rs. Initial Deposit:

Rs. 5,000 (Semi-Urban) 25000-Average Rs. 25,000,
Quarterly Add-on Deposits:
Cheque Book Yes, FREE Yes, FREE Rs. 10,000
Internet Yes Yes 7 days to 10
Banking years, Interest
Yes, Rs.100 credited every 3
ATM & Debit Yes, Rs.100 issue & issue & months
card maintenance fees maintenance No
fees

Up to
Transfer Fees & Up to Rs.50000-NIL
Rs.50000-NIL
Charges Above Rs.50000-
Above
Rs.2.90 per 1000
Rs.50000-
Rs.0.40 per
1000
3. FCNR [ Foreign Currency Non-Resident (B) ] Account:-
Currencies Acceptable US dollar, Euro, Sterling, Pounds, Canadian dollar,
Australian dollar and Japanese Yen.
Min Deposit USD 1000 or equivalent, add-on deposit USD 1,000 or
equivalent, Min 1 year to Max 5 years
Facilities Nomination facility, deposit jointly with other NRIs

4. RFC [ Resident Foreign Currency ] Account:-

The various types of account in RFC A/c are:-
 Savings A/C
 Fixed Deposits

Other accounts- Savings A/C Fixed Deposits

Currencies acceptable USD, EURO, GBP & JPY USD, EURO, GBP & JPY but
but withdrawal in Indian withdrawal in Indian in
rupees rupees, Max- 3 Years
Interest Credited quarterly Credited quarterly 27
Internet banking Yes
 Super Saver A/C Sweep-in A/C Rupee Max A/C

Type of A/C Fixed Deposit Fixed Deposit FCNR

Purpose Liquidity of Savings Takes care of deficit Forward cover

A/C and high interest in NRI Savings / product that
rates. Current A/C by converts foreign
linking without losing currency
out on interest investments in
Tenure Linked to the deposit Linked to a Savings / INR maintained
Current Account in rupees
Add-on deposit Rs.25000 N.A. 1,2 or 3 years
Overdraft Facility, Cheque book and ----
Other Benefits High interest rates, ATM/Debit card Min Deposit
Cheque book amount - USD
1000/ GBP
2500/ Euro
2500, No lock-in
period, Higher
yield

HDFC Bank was declared as the most Technology-friendly Bank at the Business World
Best Bank Awards announced in May. These annual awards are given to top
performing Banks in the categories of Best Bank, Fastest Growing Bank, Most Tech-
savvy Bank, Best Banker and Lifetime Achievement, among others. It provides better
customer and exchange services. It holds approximately 10% Market share of total NRI
business. It provides FREE monthly statements to all the NRI customers in order to
make them aware of the position of their account. Bank has its branches in Dubai &
U.K. It gives very less advertisement as it depends more on ‘word of mouth’. It also
provides online counseling services to NRI customer to solve their doubts, saving their
time and serving them when they are abroad. They also help customers to choose the
best product for them by asking few questions online which are related to their
needs and expectations. An employee from bank, on request, also visits the
customers when they are in India, to help them by face-to-face interaction.

ICICI BANK

28
ICICI Bank is a major banking and financial services organization in India. The bank
has a network of 1,700+ branches and about 4,721 ATMs in India and present in 18
countries, as well as some 24 million customers. ICICI Bank offers a wide range of
banking products and financial services to corporate and retail customers through a
variety of delivery channels and specialization subsidiaries and affiliates in the areas
of investment banking, life and non-life insurance, venture capital and asset
management. ICICI Bank is also the largest issuer of credit cards in India. The Bank is
expanding in overseas markets and has the largest international balance sheet among
Indian banks. The Bank is now targeting the NRI (Non-Resident Indian) population.
The various types of accounts options at ICICI are-
1. NRE [ Non-Resident External ] Account:-
The various types of account in NRE A/c are:-
 Savings A/C
 Fixed Deposit
 Recurring Deposit
Savings A/C Fixed Deposit Recurring Deposit

Min Bal Rs.15000 Rs.25000, 1year to Rs.5000 to Rs.100000

Intern Y 10 years Multiples of Rs.1000
ational ATM- es
Debit card
Internet Yes
Banking Yes
Mandate Card
Yes

2. NRO [ Non-Resident Ordinary] Account:-

The various types of account in NRO A/c are:-
 Savings A/C
 Fixed Deposits
 Recurring Deposits
Savings A/C Fixed Deposit Recurring Deposit

29
 Min Bal Rs.15000 Rs.25000, 15 Rs.5000 to Rs.100000
days to 10 years Multiples of Rs.1000
ATM Card Yes, Rs.200 annual
charges Yes
Internet
Banking Yes

3. FCNR [ Foreign Currency Non-Resident (B) ] Account:-

Currencies USD, GBP, EUR, JPY, AUD, CAD
Acceptable

Min Deposit USD= GBP= EUR=1000, AUD=CAD=2000, JPY=200000, Min

1 Year to Max 5 Years

Facilities Automatic renewal on maturity, Electronic Deposit

Confirmation Advise (E- DCA) on e-mail ID within 1
working day
4. RFC [ Resident Foreign Currency ] Account:-
The various types of account in RFC A/c are:-
 Savings A/C
 Fixed Deposits
Savings A/C Fixed Deposits

Currencies USD, GBP USD, GBP, EUR and JPY

Acceptable USD=GBP= EUR 1000, JPY
Min Bal 200000, Min 30 days to
Max 3 years

Other accounts-
Rupee Plus Plan Seafarer A/C Student A/C NRI Edge

30
 Purpose Earn higher Manage Manage Bouquet of
returns on finances while finances in features on all
deposits than sailing away easier NRI based
NRE FD from home, manner & get products and
Easy Access and Attractive services,
Currencies USD/GBP/EUR Monitoring Exchange Free Inter-
acceptabl Rates national ATM-
e cum-Debit
card,
Rs.5000 withdrawal up
USD=EURO=2500 Rs.15000 to Rs.100000,
Min Bal / GBP 1000 / Rs Free Money Free multi-city
100000 Transfers, cheque-book,
Easy Access Insurance
1 year and 1 day Free Money and benefits.
Tenure Transfer Monitoring

NRI SMART SAVE NRO FD PLUS Global Indian meNRI

DEPOSIT A/C
Free collection Get a high post tax For NRI living in For NRI living in
facility for NRI yield through UK, convenience UAE, ICICI-NRI
customers to lower tax rates, of opening both Services and
transfer their Advantage of an NRE Rupee meBANK joined
deposits from other Double taxation A/C & an UK hands to give a
banks to invest in avoidance Current A/C, one-stop shop
ICICI, agreement Access to facility, Debit
Lifetime Free inter- between India & banking facility, cards and cheque
national credit card, other countries, Instant books, Internet
insurance cover Available on new & onlineremittance banking
existing NRO-FD facility from the
A/C UK Current A/C
to the NRE A/C
ICICI Bank won World Finance 2009 banking awards for best NRI services bank. ICICI
bank has approximately 30% market share of total NRI business. It provides Free P.O.
Box facility to all the customers so that they can contact bank without any charge. It
has its branches in Newyork. A special website money2india.com of ICICI bank
provides facility to the general public for money transfer. Bank account holders get
quick service at few charges when they use this website to transfer money. It also
has ‘NRI Engage’ to strengthen relations with NRI’s by providing newsletter centered
on information related to NRI investments. It gives advertisements in September &

31
October as most NRI visit India in that period. It gives Electronic Deposit
Confirmation to every customer after the transaction is done. It also provides online
counseling services to NRI customer to solve their doubts, saving their time and
serving them when they are abroad. An employee from bank, on request, also visits
the customers when they are in India, to help them by face-to-face interaction.

CORPORATION BANK
Corporation Bank started its journey in the name of the Canara Banking Corporation
(Udupi) Ltd in 1906 with a sum of Rs. 5000 only in a small town of Udupi near the city
of Mangalore in Karnataka. Corporation bank merged with the Bank of Citizens in
1961. In April 1980, it was given a status of nationalized bank. Currently it is one of
the well-recognized Public Sector Banks in India. It runs more than 600 ATMs
extending across 21 States and 2 Union Territories. In the field of personal banking
services, any customer can seek services like Corp Pragathi Account, Current Account,
Term Deposit, EMI / Deposit Maturity Calculator, Home Loan and Insurance, Savings
Bank A/C and Loans. This bank assists in the sale of gold coins and bars. For NRI
customers, the Corporation Bank arranges for Speed Cash and Speed Remittance, Corp
Quick Remit, loans, deposits and portfolio services. Forex Facilities for Residents,
NRIs & PIO’s are also available.The various types of accounts options at Corporation
Bank are-

1. NRE [ Non-Resident External ] Account:-

The various types of account in NRE A/c are:-
 Savings A/C
 Current A/C
 Fixed Deposit
 Recurring Deposit
Savings A/C Current Fixed Deposit Recurring Deposit
A/C

32
Min Bal Rs.500 Low Rs.1000, 1 to Invest a fixed sum
10 years monthly and draw
MCC Yes Yes the total amount
with interest on
Internet Yes Yes maturity
Banking

ATM-cum- Yes Yes

Debit card

2. NRO [ Non-Resident Ordinary] Account:-

The various types of account in NRO A/c are:-
 Savings A/C
 Current A/C
 Fixed Deposits
 Recurring Deposits

Savings A/C Current A/C Fixed Deposit Recurring

Deposit
Min Bal Rs.500 Low Rs.1000, 7 days Invest a fixed
to 10 years sum monthly
MCC Yes Yes and draw the
total amount
Internet Yes Yes with interest
Banking on maturity

ATM-cum- Yes Yes

Debit Card

3. FCNR [Foreign Currency Non-Resident (B) ] Account:-

Currencies Pound Sterling, US Dollar, Japanese Yen, Euro, Canadian
Acceptable Dollar and Australian Dollar
Min Deposit USD 1000 or equivalent, Min 1 year to Max 5 years
Facilities Joint Account (with NRI’s), International Debit Card &
Internet banking.

4. RFC [ Resident Foreign Currency ] Account:-

The various types of account in RFC A/c are:-
 Savings A/C
33
  Fixed Deposits
Savings A/C Fixed Deposits
Currencies Acceptable USD USD
Min Bal USD 250 USD 1000, Min 1 year to Max
3 years

Corporation Bank has limited number of NRI depositors. Due to less number of
accounts and facilities, few of NRI’s deposit money with them. It holds approximately
5% market share of total NRI business. They do not lay much emphasis on NRI’s. It
does not provide any free account statements or any other extra services like online
counseling, face-to-face interaction etc. They do not give any advertisement focusing
NRI’s. Therefore the NRI customer base of Corporation Bank is limited.

AXIS BANK
Axis Bank, formerly UTI Bank, is a financial services firm that had begun operations in
1994, after the Government of India allowed new private banks to be established. The
Bank was promoted jointly by the Administrator of the Specified Undertaking of UTI,
LIC, GIC, NIC etc. UTI holds a special position in the Indian capital markets. The bank
changed its name to Axis Bank in April 2007 to avoid confusion with other unrelated
entities with similar name. At the end of March, 2010, the Bank has a very wide
network of more than 1000 branches and Extension Counters. The Bank has a network
of over 4055 ATMs.
The various types of accounts options at Axis Bank are-

1. NRE [ Non-Resident External ] Account:-

The various types of account in NRE A/c are:-
 Normal Savings A/C
 Prime Savings A/C
 Current A/C
 Term Deposit
 Priority A/C
34
 Normal A/C Prime A/C Current Term Priority A/C
A/C Deposit
Min Bal Rs.5000 Rs.25000 Rs.10000 Rs.10000, Min Avr Bal
3 years to Quarter-
Internet Yes Yes 10 years Rs.1lakh in SB
Banking A/c OR Min Avr
Rs.5 lakh in
MCC Free Yes combination SB
+ TERM deposit
Debit Rs.95-issue FREE(inter- FREE(inter-
Card charges national) national)

Priority A/c has various other features like Priority Banking Lounge, Dedicated
Relationship Manager, preferential pricing on foreign exchange rates, discounted rate
of 25% on annual fees for availing locker facilities, Mobile banking etc

2. NRO [ Non-Resident Ordinary ] Account:-

The various types of account in NRO A/c are:-
 Normal Savings A/C
 Prime Savings A/C
 Current A/C
 Term Deposit
 Priority A/C


Normal A/C Prime A/C Current Term Priority A/C

A/C Deposit
Min Bal Rs.5000 Rs.25000 Rs.10000 Rs.10000, Min Avr Bal
7 days to Quarter-Rs.1lakh
Internet Yes Yes 10 years in SB A/c OR Min
Banking Avr Rs.5 lakh in
combination SB +
MCC Free Yes TERM deposit
FREE(inter-
national)
Debit Card Rs.95-issue FREE (inter-

35
 charges national)

3. FCNR [ Foreign Currency Non-Resident (B) ] Account:-

Currencies USD, GBP, EUR, JPY, AUD, CAD

Acceptable

Min Deposit USD 1000 or equivalent, Min 1 Year to Max 5 Years

4. RFC [ Resident Foreign Currency ] Account:-

The various types of account in RFC A/c are:-
 Savings A/C
 Fixed Deposits
Savings A/C Fixed Deposit
Currencies Acceptable USD, GBP, EURO, AUD and USD, GBP, EURO, AUD
CAD and CAD

Min Bal USD 1000 or equivalent,

30 days to 5 years

Other accounts-
NRE Salary A/C Portfolio Investment Scheme(PIS) A/C

36
 Establishments with a minimum of 10
NRI employees can opt for NRI salary
accounts to provide world class banking
facilities to their employees, Free
Multicity Cheque Books & International
Debit Card, Personal Accident Insurance
Cover of Rs. 2 Lakh, Free Internet
Banking, Tele-banking & Monthly Email
statements
Allows NRIs to invest in shares of Indian
companies, in secondary market, in
respect of shares or convertible
debentures sold or purchased through a
registered stock broker on a recognized
stock exchange, Low Min Bal Rs 5,000,
Low cost of transaction, Account
maintenance charge of Rs 1,000 & Free
Internet Banking

Axis Bank has very good infrastructure facilities. It holds approximately 15% market
share of total NRI business. The relationship manager is in regular touch with all the
customers. Also NRI help desk has been setup for solving the problems of people. NRI
Local Post Box is there for the customers for sending documents to the bank. It gives
advertisements focusing NRI’s in November, December & January as most of the NRI’s
visit India at that time. An employee from bank, on request, also visits the customers
when they are in India, to help them by face-to-face interaction.

IDBI BANK
IDBI Bank offers attractive interest rates, vast network, excellent service and a
complete suite of products make IDBI Bank the preferred bank for NRI’s.
The various types of accounts options at IDBI are-

1. NRE [ Non-Resident External ] Account:-

The various types of account in NRE A/c are:-
 Savings A/C
 Current A/C
 Fixed Deposit

Savings A/C Current A/C Fixed Deposit

37
 Min Bal Rs.5000 Rs.10000 Rs.10000, 1
year to 3 years

Interest Compounded Compounded Compounded

quarterly quarterly quarterly

Cheque book Yes Yes

International ATM
cum Debit Card Yes Yes

Online account Yes

statement

2. NRO [ Non-Resident Ordinary ] Account:-

The various types of account in NRO A/c are:-
 Savings A/C
 Current A/C
 Fixed Deposit
 Recurring Deposit

Savings A/C Current A/C Fixed Deposit Recurring

Deposit
Min Bal Rs.5000 Rs.10000 Rs.10000, 15 Rs.100 per
days to 10 years month
Interest Compounded Compounded Compounded Compounded
quarterly quarterly quarterly quarterly

Cheque book Yes Yes

International Yes Yes

ATM cum
Debit Card

Online Yes
account
statement

3. FCNR [ Foreign Currency Non-Resident (B) ] Account:-

38
 Currencies USD, GBP, EUR, AUD, CAD
Acceptable

Min Deposit USD 1000 or equivalent, Min 1 Year to Max 5 Years

Interest Initial interest is paid after one year and subsequently
after every six months

4. RFC [ Resident Foreign Currency ] Account:-

The various types of account in RFC A/c are:-
 Savings A/C
 Current A/C
 Fixed Deposits
Currency Acceptable USD, GBP, EUR & JPY

Min Deposit USD 1000(for FD), up to 3 years

Interest Compounded quarterly

Facilities Cheque book with SB A/c, International ATM cum

Debit Card, Online account statement

Other accounts-
Super Galaxy Power Preferred A/C Royale A/C
Savings A/C Silver Plus A/C
A/C
Average Rs.5000 Rs.25000 Rs.50000 Rs.100000 Rs.300000
Quarterly
Balance

Internationa Rs.99(annual Yes Free Free(Gold) Free(Platinum)

l ATM/Debit fee)
Card
Cheque
Book, FREE FREE FREE FREE FREE
Internet &
Phone
banking

39
IDBI Bank has very less NRI customers. It holds approximately 0.2% market share of
total NRI business. It has a branch in Dubai but its services are limited to wholesale
banking only. It does not have any representative offices in other countries. It
provides Insta Online service by which NRI’s can open NRI account immediately from
home or office and customer gets immediate receipt of account number. It goes for
advertisement in the month of June & July at Kerala as it is the time of
festival-‘Onam’ and most NRI’s visit Kerala at this time. It also organizes various
camps and offer gifts and extra facilities on opening of new accounts at this time. It
also launched Portfolio Investment Scheme services in Kochi which would enable NRIs
and Persons of Indian Origin to invest in secondary capital market. More than 40
brokers in Kerala and other parts of the country along with NRIs attended the
conference in March 2010. Advertisement in rest of the parts of the country is given
in the month of November, December and January as it is the time when most of the
NRI’s visit India. It does not provide any online counseling services. The bank, on
request, also contacts the customers when they are in India.

40
 5. FINDINGS

After the whole study, it has been depicted that ICICI Bank is the leader in this field
followed by SBI. SBI is enjoying a good share because of it mutual trust among the
people and being the first one to start NRI services. ICICI Bank, Axis Bank & HDFC
Bank holds good share because they provide the facilities as suited & expected by the
customers. They pay more and more attention on the customers and keep them
happy by providing different services. They are in regular touch and have specialized
branches & desk to help them. They lay emphasis on making new customers and
retaining existing once. Their international presence, basket of services & brand
image is the key to their success. Corporation Bank has less market share because it
does not pay attention on enhancing it business. It has its few traditional accounts &
customers and has not yet extended its facilities.

IDBI Bank has to face very tough competition in enhancing its business. As it is seen
that the interest rates of all the banks are more or less same, the basic difference
lies between the minimum balance, the services offered and the charges on these
services. IDBI Bank thus suffers on the parameters related to these due to which it
has very less NRI customers. Firstly, the branches and the representative offices of
the bank in foreign countries are not present due to which it is far behind the reach
of NRI’s. Secondly, the types of accounts offered to NRIs are less due to which it
cannot satisfy the needs of each and every customers. Thirdly, various facilities like
online counseling, product selection etc are not present as compared to other banks.
Fourthly, the advertisements of this bank are very less due to which many of the
customers may not even know of the various services provided by the bank. Any of
the mechanism which can be used to find out the likes & dislikes of the customers
and feedback system is also not there. The various ways to keep the customers
informed and maintain contacts with them like newsletters etc are absent. Bank also
has the lack of infrastructure facilities. It does not have any specialized branches &

41
help desk for NRI’s in India as other banks have it. The existence of these matters a
lot as it is the way to please the customers and attract them towards the banks.

42
 6. LIMITATIONS

Though the emphasis has been laid on maintaining accuracy and minimizing the errors
in the collection & analysis of data, yet there were some limitations faced during the
study.

Limitations as far as the study is concerned are-

 The management of the all the offices were not interested in interacting as
they got the clue that the information is collected for some research project.
 Information like number of customers, amount of deposits etc was not
provided.
 As the secondary data and the approximate figures were taken into
consideration, it became quite difficult to get the actual picture.
 The policy of the banks to maintain secrecy was the main hindrance in
collection of data.
 Due to shortage of time, an exhaustive research/competitor analysis could not
be carried out

43
 7. RECOMMENDATIONS

As it is seen that the basic difference between all the competitor banks lies in the
services provided and the way of handling customers, IDBI Bank can improve its
business by making changes and extending some of its facilities. The various steps
which IDBI Bank can take in order to enhance its NRI business and acquire a good
market share are -

 Improvement of the infrastructure is most important as it attracts customer the

most.
 The branches and the representative offices of the bank should be set up in
foreign countries so that it is in the reach of NRI’s residing in different parts of
the world.
 Specialized branches & help desk for NRI’s in India should be set up to
facilitate them.
 Various modes of operating account like Internet Banking, Phone Banking etc
should be associated with all types of accounts.
 The Advertisements should be given from time to time and especially in
November, December and January at large scale as it is the time when most of
the NRI’s visit India.
 Some extra benefits like free ATM card, Cheque book, less remittance charges
etc can be associated with the accounts.
 The type of accounts and services with certain related benefits may be
increased so that customers feel important and can satisfy their multiple
needs.
 Various facilities like online counseling, with tailor made product/solution etc
should be introduced so that customer can get accurate information by saving
time & cost.

44
 Proper mechanism to find out the likes & dislikes of the customers and get
feedback of the services rendered should be used as it will act as the mirror of
performance & basis of improvement.
 Statements of accounts, annual reports, newsletters etc should be used to keep
in touch with the customers and also keep them informed.
 A database of NRI’s can be prepared and they can be made aware with the
various services of the bank through e-pamphlets, reports etc.

45
 8. REFERENCES
• Interactions with NRI Services Departments:-
 Mr. Prashant Kumar, Relationship Manager, SBI, Mumbai
 Ms. Shalaka, HDFC Bank, Mumbai
 Mr. Abhijeet Kumar, Assistant Manager, ICICI Bank, Mumbai
 Mr. C.Sridharan, Chief Manager, Corporation Bank, Mumbai
 Mr. Deepak Gaikwad, Relationship Manager, Axis Bank, Mumbai

 NRI Department, IDBI Bank, Mumbai

• Text Books:-
NRI's Handbook for Banking & Investments- Second Edition-July 2004, published by
Banknet India

• Brochures of all the banks

• Web Pages:-
 www.rbi.org.in
 www.iba.org.in
 www.nrionline.com
 www.nriinformation.com
 www.onlinesbi.com/nri/
 www.hdfcbank.com/nri_banking/home.htm
 www.icicibank.com/pfsuser/icicibank/ibank-nri/nrinewversion
 www.corpbank.com
 www.axisbank.com/nri/index.asp
 www.idbi.com/products/nriservice.asp

 www.finmin.nic.in
 www.iibf.org.in
46
 www.idrbt.ac.in

47