nationalised banks
TRANSCRIPT
A study of Bank Deposits and Mobilisation with reference to Nationalised Banks.
Dissertation submitted in partial fulfillment of the requirement for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION OF BANGALORE UNIVERSITY
By NIDHIN RAMESH Register number 05MJCM6027
Under the guidance of Prof. Ramesh
CONTENTS
Title
1. INTRODUCTION 1 Introduction to the Study 2 Background of the Study
2. DESIGN OF THE STUDY 2.1 Statement of the Problem 2.2 Scope of the Study 2.3 Need for the Study 2.4 Objectives of the Study 2.5 Survey/Review Literature 2.6 Research Design 2.7 Sources of Data 2.7.1 Secondary Data 2.7.2 Primary Data 8 2.8 Field Work 2.9 Data Analysis Tools Used 2.10 Operational Definitions of the Study 2.11 Limitations of the Study 2.12 Overview of the Report
3. PROFILE OF THE RESPONDENTS 3.1 Profile of the Industry 3.2 Profile of the Organization
4. ANALYSIS AND INTERPRETATION 4.1 Introduction to Analysis 4.2 Analysis of various deposit scheme
5. SUMMARY OF CONCLUSIONS AND SUGGESTIONS 5.1 Findings 5.2 Suggestions and Recommendations 5.3 Summary of Conclusions
BIBLIOGRAPHY
LIST OF TABLES
SL NO. 1 2 3 4 5 6 Table showing savings bank account Table showing Recurring deposit Table showing senior citizens deposit account Table showing reinvestment plan deposit Table showing number of deposit schemes Table showing additional interest rates on senior deposit scheme 7 8 9 10 11 12 13 14 Table showing deposit scheme for children Table showing interest rate of Canara bank Table showing SBI interest rate Table showing SBI senior citizen deposit scheme Table showing SBI Re-investment plan Table showing Indian bank interest rate Table showing corporation bank Interest rates Table showing corporation bank capital gain account scheme 15 Table showing IOB interest rate LIST OF TABLES
LIST OF GRAPHS SL NO. 1 2 3 4 5 6 Graph showing interest rate on saving bank account Graph of Recurring deposit account Graph of Senior citizens deposit scheme Graph of reinvestment plan deposit Graph of number of deposit schemes Graph of additional interest rate for senior citizen List of Graph
EXECUTIVE SUMMARY
This project is mainly concerned with the deposit section of nationalized banks. The main objective was to study the various deposit schemes offered by nationalized banks for mobilizing deposits from public.
Deposit constitutes the backbone of the finance company. Deposits are accepted from the public for profitable deployment in the company’s business, consisting of hire purchasing, leasing etc
The study has been conducted to know the various deposit schemes offered by different nationalized banks with different interest rates and benefits for mobilizing their deposits. Here the main idea is to analyze the difference between various deposit schemes offered by five nationalized banks.
This topic of the project is mainly concerned with deposit section. The main area covered under this is the study of various schemes offered by nationalized banks with different interest rates and benefits to attract deposit amount.
The study has been focused towards how nationalized banks attract funds from the investors. The various methods, interest rates offered by different banks to have their own uniqueness has been needed for this study.
The main objectives of the study are as follows: To find out the various schemes offered by nationalized banks for mobilizing deposits. To find out the savings and investment modes offered by banks. To study the pattern and acceptance of deposits. To know which deposit scheme is really performing well.
Research design is a basic plan which guides the researcher in the collection and analysis of data required for practicing the research. The fundamental base for the success of a project depends on its effective research design. Research design simply means a search for facts, answers to questions and solutions to problems.
In this research the data analysis tools used are percentages and graphs. The various attributes were analyzed separately and the importance to each was calculated on basis of the percentage. The rank having the maximum percentage was taken to be preferred importance to the particular attribute.
Every research project is carried out with a specific objective in mind. The researcher tries his best to achieve accurate results. But even if utmost care is taken right from the stage of topic selection through identifying data sources, analysis, selecting, finding scope of study, no research project can achieve 100% accurate results. Sampling and non sampling error may affect the result to some extent.
1.1 INTRODUCTION TO THE STUDY
This project is mainly concerned with the deposit section of nationalized banks. The main objective was to study the various deposit schemes offered by nationalized banks for mobilizing deposits from public.
Deposit mobilization means attracting deposits from investors. Another area of progress of banks is the acceleration of deposit mobilization. Deposit mobilization effort by banks has not been adequate to meet the needs of the present economic environment. Yet there is a vast scope for mobilizing deposits from different sectors of the economy, particularly in rural areas. Most of the deposit mobilization schemes are now tailored to the convenience and preference of the urban depositors, neglecting the potential rural depositors. The banks have to tailor the schemes to match in nature, convenience, preference and the needs of the rural depositors to be able to exploit the untapped rural savings.
The banks have to re-tailor or refashion their schemes in the light of every emerging situation and in view of the severe competition from national savings organization, unit trust of India, non-banking companies and the like.
The success of any deposit mobilization would very much depend upon the personalized services of the staff of rural branches. Integration with the rural community, participation in local activities and development of personal relations by the banks staff will enable the bank to tap the rural savings.
What is Deposit Mobilisation ?
Banks utilize its funds in suitable area and right sector. Banks cannot achieve its goals until and unless it mobilizes its deposits in right sectors and by performing different activities. Much kind of activities and other thing can origin for the purpose of receiving invest from the bank. But bank should separate the
useful and profitable sector for mobilization its deposits. Banker being only a financial intermediary, we will not be able to make any profit unless he has to pay interest on deposits, meet establishment expenses, meet liquidity of cash balance, and yet allow him some balance from out of which he can build reserve and pay dividend to the shareholder. As commercial bank they are expected to make profit. If there is no profit, there will be adverse criticism against public sector banking, both in and outside the parliament when these banks are asked to open new branches in areas which do not allow profits for years, or asked to grant loan to the priority sectors such as small industries and agriculture with a high incidence of bad debts, there is need for counter balancing profit from elsewhere. Therefore, these banks will have to show an ascending order of profits in order to ensure growth with stability. For this purpose the bank will have to allocate land able resources to different segments in such a manner these banks can ensure adequate profitability while at the same time responding to policies laid down in accordance with national objectives. Therefore, banks should mobilize its deposits in suitable and profitable banking activities and right sector. Generally bank has mobilized its deposits in the following activities. a. Liquid FundsA bank has kept a volume of amount in liquid funds. The funds have so many responsibilities in banking activities liquid funds has covered following transactions. Cash in hand
Balance with NRB
Balance with domestic bank
Call money
b. InvestmentBank invests its fund in different banking activities and different fields. Many types of fields are shown in market for investment. But banks invest its funds in profitable and safety activities. Bank invests its fund in the following titles: Share and debenture
Government securities
Joint-venture
c. Loan and AdvancesBanks mobilize its funds or deposits by providing different types of loan and advances to customers, by charging fixed interest. Different types of loan and advances are To government enterprises
To provide enterprises
Bank manages the different types of loans i.e. providing loan, business loan, and traditional loan to priority area. d. Fixed AssetsLand and buildings are essential for the establishment of bank. Bank’s funds are used in buying of furniture, vehicle, computer, and other concerned instrument, which are related to banking activities. Bank
cannot take direct gain from these assets, but bank should buy it. A bank has a need of fund to purchase fixed assets for the new branches of the bank. e. Administrative and Miscellaneous ExpensesBank should manage funds for administrative and other miscellaneous expenses. The administrative expenses are: Salary of Employee
Allowances
Pension
Advertisement
Stationery
Provident Fund
Rent
Income tax
Donation
Insurance
Tour expenses
Commission
The miscellaneous expenses are To distribute the dividend to shareholders
To bear the loss on sale and purchase of banking assets
Maintenance expenses
To pay the interest on borrowed amount
Reserve fund
In this way, bank mobilizes its deposits by performing different activities to achieve its desired goals i.e. earning profit. Banks are able to earn sufficient profit by mobilizing its deposits in proper way into the different profitable sector. It can utilize its collected deposits as well as own funds in all banking activities by performing effective deposit mobilization procedure.
Nationalization has made it possible for the banks to reach to the remotest corner of the country to meet the economic needs by formulating schemes to suit the requirements of the weaker section of the society in innovative manners. Thus, nationalization has helped banks in achieving the all round progress of the country by achieving the socialistic goals.
1.2 BACKGROUND OF THE STUDY
Deposit constitutes the backbone of the finance company. Deposits are accepted from the public for profitable deployment in the company’s business, consisting of hire purchasing, leasing etc.
Meaning of deposit The key success for commercial banks is deposits and this is where the real crunch is expected, particularly for the newer banks. Not only deposits become harder to mobilize, they will become increasingly expensive to maintain and lending rates, with or without a cap on them, cannot be raised by banks beyond a certain limit.
Bank should posses the following feature in order to mobilize deposit: • • • • • Should have financial stability. Should be managed by professionals. Should offer attractive schemes. Should offer attractive interest rates. Should offer courteous service.
Purposes of savings are as follows: • • • • To meet emergencies. To earn returns on surplus money. To purchase plot / flat / house. General financial security.
• • • •
To buy durables. Regular income after retirement. To start or expand business. Medical / wedding / children’s education.
Progress of the bank: 1. Branch expansion: The branch expansion program of commercial banks is very significant for fulfilling the socio-economic goals, particularly the balanced development of various parts of the country. Impressive progress of commercial banks in increasing their branch network and diversifying their activities has brought about a wider, special and functional spread of banking facilities in the country
2. Deposit mobilization: Another area of progress of banks is the acceleration of deposit mobilization. Deposit mobilization effort by banks have not been adequate to meet the needs of the present economic environment. Yet there is a vast scope for mobilizing deposits from different sectors of the economy, particularly in the rural areas. The success of any deposit mobilization would very much depend upon the personalized services of the staff of rural branches. Integration with the rural community, particularly in local activities and development of personal relations by the bank staff will enable the bank to tap the rural savings.
The banks have to tailor the schemes to match, in nature, convenience, preference and the needs of the rural depositor to be able to exploit the untapped rural savings. Besides this, in a vast country like ours, the requirements and preferences of various community groups in different areas undergo periodic changes.
3. Advance to priority sector: Bank also offer advances for the national growth. It provide advances like, agricultural finance, institutional financing, export finance, and also provide advances to small scale industries.
2.1 STATEMENT OF THE PROBLEM
The study has been conducted to know the various deposit schemes offered by different nationalized banks with different interest rates and benefits for mobilizing their deposits. Here the main idea is to analyze the difference between various deposit schemes offered by five nationalized banks.
2.2 SCOPE OF THE STUDY
This topic of the project is mainly concerned with deposit section. The main area covered under this is the study of various schemes offered by nationalized banks with different interest rates and benefits to attract deposit amount.
2.3 NEED FOR THE STUDY
The study has been focused towards how nationalized banks attract funds from the investors. The various methods, interest rates offered by different banks to have their own uniqueness has been needed for this study.
2.4 OBJECTIVES OF THE STUDY
The main objectives of the study are as follows: To find out the various schemes offered by nationalized banks for mobilizing deposits. To find out the savings and investment modes offered by banks. To study the pattern and acceptance of deposits. To know which deposit scheme is really performing well..
2.5 REVIEW OF LITERATURE
To carry the research work the researcher has gone through a few reports, books, journals and websites. The details regarding nationalized banks, history, origin and growth of nationalized banks was also taken from books, magazines etc. the sources of this
2.6 RESEARCH DESIGN
Research design is a basic plan which guides the researcher in the collection and analysis of data required for practicing the research. The fundamental base for the success of a project depends on its effective research design. Research design simply means a search for facts, answers to questions and solutions to problems.
This research is by and large involves the following methods: Scanning through standard text books to understand the theory behind deposit mobilization. Decision regarding the study of depository system of five nationalized banks. Collection of industry profile and their different schemes. Finally forwarding certain recommendations and conclusions to the nationalized banks. By and large the above research design was employed for the study.
Secondary data: Secondary data means data that are already available that is they refer to the data which have been collected and analyzed by someone and can save the time of the researcher.
Secondary data may be available in the form of company records, trade publications, libraries etc. The secondary data sources are: a. company reports. b. Daily news papers. c. Articles.
d. Brochures and text books. e. Internet (various web sites).
Primary data: Primary data are those which are collected for the first time. Primary data is collected by interviewing certain employees, managers who were chosen on the basis of their in depth knowledge and work experience in the bank. The interview was informal in nature to gain as much as possible.
2.8 FIELD WORK
Initial field work is done for pre-testing tools for data collection, such as observations and interview schedule and measurement scales. The main field work is launched after the tools are ready for use.
2.9 DATA ANALYSIS TOOLS USED
In this research the data analysis tools used are percentages and graphs. The various attributes were analyzed separately and the importance to each was calculated on basis of
the percentage. The rank having the maximum percentage was taken to be preferred importance to the particular attribute.
After having looking at each attribute separately, all the attributes were considered together to develop a map on the most preferred rank for all the attributes.
In the present project the field work consists of going to libraries for theoretical aspects and browsing through net for various schemes offered by different nationalized banks and also visiting banks for certain clarification.
2.11 OPERATIONAL DEFINITIONS OF THE STUDY
Deposit: Money given in advance to show intention to complete the purchase of a property or Money transferred into a customer's account at a financial institution.
Banking: "Accepting, for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdrawable by cheques, draft, order or otherwise. Bank Account A Bank Account is the record of financial relationship a customer has with the Bank. It contains details of all the moneys deposited with the Bank and withdrawn from it.
Current account Current account is a running account, to caters the needs of business people who make use of the cheque facilities extensively and also receive cheques in their favours.
Term deposit: Term deposit is deposit received by the banks for a specified fixed period of time which is withdrawable only after the expiry of the said period.
Recurring deposit: A recurring deposit is a form of term deposit in which depositor deposits a fixed sum of money by way of monthly installment over a stipulated period and on the expiry of this period, the accumulated amount along with interest accrued is paid in lump sum.
Fixed deposit: Fixed deposit is a deposit scheme wherein a depositor agrees to receive back the principle amount after a specified period agreed at the time of deposit. Interest may be received by him periodically or at maturity.
2.11 LIMITATIONS OF THE STUDY
Every research project is carried out with a specific objective in mind. The researcher tries his best to achieve accurate results. But even if utmost care is taken right from the stage of topic selection through identifying data sources, analysis, selecting, finding
scope of study, no research project can achieve 100% accurate results. Sampling and non sampling error may affect the result to some extent. The main limitations of this project are: Time was the major limitation because only in two and half months research project should be prepared and in this limited time of the study all the information was not possible to be collected. The study was exclusively limited to five nationalized banks.
2.12 OVERVIEW OF THE REPORT
A systematic and detailed study of the deposit mobilization was undertaken with respect to nationalized banks. This report has been explained in five chapters. Chapter-I This chapter highlights the general introduction and the theoretical background of the study. This gives a brief idea regarding the project.
Chapter-II This chapter states the research design, sources of data, statement of the problem, field work, data collection instruments, scope of the study, objectives of the study, need for the study, limitations of the study, an overview of the report.
Chapter-III This chapter throws light on the profile of the industry, the profile of the organization.
Chapter-IV In this chapter, the data collected is compiled, tabulated, processed and analysed. Graphs are shown to make the findings. Brief introduction of each deposit and its analysis of the data has been given
Chapter-V Conclusions are prepared on the basis of the analyzed data and certain recommendations have been added which can be helpful for the company to improve their performance.
3.1 PROFILE OF THE INDUSTRY
Banks are among the main participants of the financial system in India. Banking offers several facilities & Opportunities. However, owing to the lack of information & guidance, general public cannot avail of full benefits from the Banking system. Banking professionals regularly update News & Articles and Policies to keep you abreast of the latest developments in the field of banking.
The major participants of the Indian financial system are the commercial banks, the financial institutions (FIs), encompassing term-lending institutions, investment
institutions, specialized financial institutions and the state-level development banks, NonBank Financial Companies (NBFCs) and other market intermediaries such as the stock brokers and money-lenders. The commercial banks and certain variants of NBFCs are among the oldest of the market participants. The FIs, on the other hand, are relatively new entities in the financial market place.
Bank of Hindustan, set up in 1870, was the earliest Indian Bank . Banking in India on modern lines started with the establishment of three presidency banks under Presidency Bank's act 1876 i.e. Bank of Calcutta, Bank of Bombay and Bank of Madras. In 1921, all presidency banks were amalgamated to form the Imperial Bank of India. Imperial bank carried out limited central banking functions also prior to establishment of RBI. It engaged in all types of commercial banking business except dealing in foreign exchange.
Reserve Bank of India Act was passed in 1934 & Reserve Bank of India (RBI) was constituted as an apex bank without major government ownership. Banking Regulations Act was passed in 1949. This regulation brought Reserve Bank of India under government control. Under the act, RBI got wide ranging powers for supervision & control of banks.
RBI was empowered in 1960, to force compulsory merger of weak banks with the strong ones. The total number of banks was thus reduced from 566 in 1951 to 85 in 1969. In July 1969, government nationalized 14 banks having deposits of Rs.50Crores & above. In 1980, government acquired 6 more banks with deposits of more than Rs.200Crores. Nationalization of banks was to make them play the role of catalytic agents for economic growth. Banking Segment in India functions under the umbrella of Reserve Bank of India - the regulatory, central bank.
In addition, Banks are allowed to perform certain activities which are ancillary to this business of accepting deposits and lending. A bank's relationship with the public, therefore, revolves around accepting deposits and lending money. Another activity which is assuming increasing importance is transfer of money - both domestic and foreign from one place to another. This activity is generally known as "remittance business" in banking parlance.
The so called forex (foreign exchange) business is largely a part of remittance albeit it involves buying and selling of foreign currencies. The law governing Banking Activities in India is called "Negotiable Instruments Act 1881".
Banks are also called custodians of public money. Basically, the money is accepted as deposit for safe keeping. But since the Banks use this money to earn interest from people who need money, Banks share a part of this interest with the depositors. The quantum of interest depends upon the tenor - length of time for which the depositor wishes to keep the money with the Bank - and the ease of withdrawal. The thumb rule is, longer the tenor, higher the rate of interest and lesser the restrictions on withdrawal, lesser the interest. Exceptions, however, exist. Deposits are accepted from both resident (domestic) or non-resident Indian customers.
It is the business of the banker to accept deposits so that he can lend it to others and earn interest. Depending upon the liquidity position of the market and the size of deposit, the earnings can vary and if the size of the deposit is big enough, it is advisable to shop around and get the best rate.
Type of deposit accounts (Domestic Customers)
1. Fixed Deposit Accounts 2. Demand Deposits
o
Savings Account
o
Current account
Most of the other products offered by the Banks viz. Recurring Deposit Account, Multi Option Deposit Account, Special Term Deposit Accounts, Current Fixed Account etc. are essentially combinations of the above basic type of accounts and are packaged by different Banks to attract different groups of customers. After nationalization of 14 major banks on 19th July, 1969, the banks were advised to open branches in rural and semi-urban areas and provide funds for all productive activities, irrespective of size and social status of the borrower, particularly to the weaker sections of the society. On 15th April 1980, six more banks were nationalized extending further the area of public control over the country’s banking system.
India adopted a socialistic pattern of society as its goal under which the wealth is required to distribute equitably among the various classes of the people in the country. The banking industry in the country was a powerful medium to mobilize the savings of the public and provide credit to the needy for their economic development.
The basic objective of nationalization of major commercial banks was to divert their funds for helping those sectors of the economy which actually accounted for significant portion of national production which were neglected earlier and were not getting adequate support of institutional finance.
Another reason for the nationalization of banks was to shift the control of banks from the hands of persons who continued to exert their influence over the bank management in one way or the other. It was feared that this continuance of the old influential people in command of the banks will not allow the implementation of government policies, program whole heartedly.
Nationalization has helped the banking industry in making significant and impressive progress. There has been rapid expansion of branches of these nationalized banks, not only in metropolitan and urban towns but also in rural and semi urban areas.
The banks could achieve tremendous progress in mobilizing deposits as a large number of branches in un-banked area, better ways and means were adopted to mobilize deposits as it has created public confidence. The extension of banking facilities in the rural and semi urban areas has not only made it possible to mobilize deposits on a large scale but has helped in inculcating banking habits in the rural masses. They have started using bank money such as cheques, pay orders, demand draft etc instead of currency. Nationalization has made it possible for the banks to reach to the remotest corner of the country to meet the economic needs by formulating schemes to suit the requirements of the weaker section of the society in an innovative manners.
Nationalization has transformed Indian banking from class banking to mass banking, from asset based lending to production oriented and need based lending. This is in fact a change in the very concept, perception and outlook of the banking.
Thus, nationalization has helped in achieving the all round progress of the country by achieving the socialistic goals.
3.2 PROFILE OF THE ORGANISATION CANARA BANK:
Founded as 'Canara Bank Hindu Permanent Fund' in 1906, by late Sri. Ammembal Subba Rao Pai, a philanthropist, this small seed blossomed into a limited company as 'Canara Bank Ltd.' in 1910 and became Canara Bank in 1969 after nationalisation.
Canara Bank is one of the premier banks in the country, accredited with umpteen distinctions. The present stature of the Bank is due to its strong fundamentals and quality customer orientations. Profit making since inception, the Bank today epitomizes a perfect blend of commercial and social banking. For the year March 2005, the Bank clocked the highest net profit ( Rs.1110 crore ) among nationalized banks, with significant improvement in capital adequacy ratio (12.78%) and asset quality (net NPA ratio of 1.88%).
The Bank has already carved a niche in providing IT-based services. With 100% computerisation of the branches, the bank provides a wide array of services, such as, Networked ATMs, Anywhere Banking, Telebanking, Remote Access Terminals Internet & Mobile Banking, Debit Card etc. The Bank was the first among banks to launch networked ATMs and obtain ISO Certification. Commercial consideration has, no way, diluted the Bank's role in national priorities. Canara Bank is in fact the first bank to be conferred FICCI award for contribution to rural development.
Founding Principles To remove Superstition and ignorance. To spread education among all to sub-serve the first principle. To inculcate the habit of thrift and savings. To transform the financial institution not only as the financial heart of the community but the social heart as well. To assist the needy. To work with sense of service and dedication. To develop a concern for fellow human being and sensitivity to the surroundings with a view to make changes/remove hardships and sufferings.
STATE BANK OF INDIA:
The origin of the State Bank of India goes back to the first decade of the nineteenth century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A unique institution, it was the first joint-stock bank of British India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921
Primarily Anglo-Indian creations, the three presidency banks came into existence either as a result of the compulsions of imperial finance or by the felt needs of local European commerce and were not imposed from outside in an arbitrary manner to modernise India's economy. Their evolution was, however, shaped by ideas culled from similar developments in Europe and England, and was influenced by changes occurring in the structure of both the local trading environment and those in the relations of the Indian economy to the economy of Europe and the global economic framework.
An act was accordingly passed in Parliament in May 1955 and the State Bank of India was constituted on 1 July 1955. More than a quarter of the resources of the Indian banking system thus passed under the direct control of the State. Later, the State Bank of India (Subsidiary Banks) Act was passed in 1959, enabling the State Bank of India to take over eight former State-associated banks as its subsidiaries.
State Bank of India, is proud to announce it having received the "TECHNOLOGY AWARD 2005" by The Banker, London
The OBU will be deemed as an overseas branch of the Bank and undertake the following activities:
•
Raise funds in convertible foreign currency as deposits and borrowings from Non Residents sources.
•
Transact in foreign exchange with residents in India who are eligible to enter into or undertake such transactions in terms of various Rules and Regulations as framed under Foreign Exchange Management Act, 1999
• •
Open foreign currency accounts abroad as well as with other OBUs in India Trade in foreign currencies in the overseas market and also with banks in India where both legs of the transactions are denominated in foreign currencies.
• •
Provide customized loan and liability products for the benefit of clients Maintain Special Rupee account with an authorized dealer in India out of the convertible foreign exchange resources for meeting local expenses
•
Buy Rupees from an Authorized Dealer in India to fund the Special Rupee Account.
CARPORATION BANK:
Corporation Bank is an organization established in 1906 based on the traditional Indian values of service to the community and is regarded as one of the well-run banks in the comity of Public Sector Banks in the country. The Bank has a unique history of 97 years of successful Banking and it stood the test of time by growing steadily offering vast, varied and versatile services with a personal touch. Today, its good customer service, preeminent track record in House Keeping, adherence to Prudential Accounting norms, consistent profitability and adoption of modern technology for betterment of customer service have earned the Bank a place of
pride in the Banking Community. The Bank has been richly endowed with a relatively young, dynamic and efficient manpower, which is the key factor of the Bank's success. Excellence in performance and uniqueness in customer service form the central core of the Bank's organizational culture. The growing
confidence of its clientele is well reflected in the Bank's performance in all critical areas of its operations all through the years.
The Bank is a Public Sector Unit with 57.17% of Share Capital held by the Government of India. The Bank came out with its Initial Public Offer (IPO) in October 1997. The Bank’s Net Worth stood at Rs.3,374.89 crore as on 31.03.2006. In pursuit of niche banking with technology as the competitive edge, the Bank has drawn up an IT Plan to provide better service to its customers. All the branches of the Bank have been computerized and consequently, 100% of the Bank's business is computerized now. The Bank endeavors to provide high quality service to its customers.
As on 30th September, 2006, the aggregate business of the Bank stood at Rs. 66,022 crore comprising Rs. 38,017 Crore Deposits and Rs.28,004 Crore Advances . With its strategic business focus and innovation, the Bank is striving for better performance in the coming years. Its total business crossed Rs.70, 000 crore in March 2007. The Bank has an ambitious plan to raise its total business level to Rs.1,00,000 crore by March 2009.
In the year 1952, the bank became the third bank in the country to receive a license from the reserve bank of India as schedule bank. In the year 1961, the bank of citizens was merged with the bank. The bank was nationalized in April 1980, which has triggered the growth of the bank in terms of geographical reach and business volumes.
The corporate mission of the bank is:
•
To meet the growing aspirations of the customers of the bank in the changing competitive environment.
•
To bring about total customer satisfaction by delivering quality service in a cost effective manner through the contribution of all.
•
To post a satisfactory return on equity investment through sustained profitable growth.
•
To meet the career aspiration and the economic needs of the employees working in the bank.
•
To fulfill national and social priority as a public sector bank.
INDIAN BANK
Indian bank is a premier bank owned by the Government of India. Established on 15th August 1907 as part of the Swedish movement. Serving the nation with a team of over 22000 dedicated staff Global deposits rose to Rs. 40805 Crores as on 31.03.2006 Net advance increased to Rs.22485 Crores as on 31.03.2006 1443
Branches spread all over India. Overseas branches in Singapore and Colombo including a Foreign Currency Banking Unit at Colombo 229 Overseas Correspondent banks in 69 countries.
The Indian bank has diversified banking activities. The 3 subsidiary companies are:
• • •
Indbank Merchant Banking Services Ltd . Indbank Housing Ltd. IndFund Management Ltd.
Indian bank is a front runner in specialized banking. It has 88 Forex Authorised branches inclusive of 3 Specialised Overseas Branches at Chennai , Bangalore and Mumbai exclusively for handling forex transactions arising out of Export, Import, Remittances and Non Resident Indian business 5 specialised NRI Branches exclusively for servicing Non-Resident Indians 1 Small Scale Industries Branch extending finance exclusively to SSI units.
Indian bank is a leader in rural banking. Loan products like Artisan Card, Kisan Card, Kisan Bike Scheme, Yuva Kisan Vidya Nidhi Yojana to meet diverse credit needs of farmers. Provision of technical assistance and project reports in Agriculture to entrepreneurs through Agricultural Consultancy & Technical Services (ACTS) .Specialised Agricultural Finance branches to finance High Tech Agricultural Projects.
The bank is a pioneer in introducing the latest technology in Banking: 168 Centers throughout the country covered under 'Anywhere Banking' Core Banking Solution(CBS) in 1035 branches and 80 extension Counters. 427 connected Automated Teller Machines(ATM) in 99 cities/towns 24 x 7 Service through 8500 ATMs under shared network Internet and Tele Banking services to all Core Banking customers e-payment facility for Corporate customers Cash Management Services Depository Services Reuter Screen, Telerate, Reuter Monitors, Dealing System provided at Overseas Branches
I B Credit Card Launched I B Gold Coin
INDIAN OVERSEAS BANK
Indian Overseas Bank (IOB) was founded on February 10th 1937, by Shri.M.Ct.M. Chidambaram Chettyar, a pioneer in many fields - Banking, Insurance and Industry with the twin objectives of specializing in foreign exchange business and overseas banking. IOB had the unique distinction of commencing business on 10th February 1937 (on the inaugural day itself) in three branches simultaneously - at Karaikudi and Chennai in India and Rangoon in Burma (presently Myanmar) followed by a branch in Penang. At the dawn of Independence IOB had 38 branches in India and 7 branches abroad. Deposits stood at Rs.6.64 Crs and Advances at Rs.3.23 Crs at that time.
During the pre-nationalized era (1947-69), IOB expanded its domestic activities and enlarged its international banking operations. As early as in 1957, the Bank established a training centre which has now grown into a Staff College at Chennai with 9 training centers all over the country. IOB was the first Bank to venture into consumer credit. It introduced the popular Personal Loan scheme during this period. In 1964, the Bank made a beginning in computerization in the areas of inter-branch reconciliation and provident fund accounts. In 1968, IOB established a full-fledged department to cater exclusively to the needs of the Agriculture sector.
At the time of Nationalization (1969) IOB was one of the 14 major banks that was nationalized in 1969. On the eve of Nationalization in 1969, IOB had 195 branches in India with aggregate deposits of Rs. 67.70 Crs. and Advances of Rs. 44.90 Crs.
Post - nationalisation era (1969-1992) In 1973, IOB had to wind up its five Malaysian branches as the Banking law in Malaysia prohibited operation of foreign Government owned banks. This led to creation of United Asian Bank Berhad in which IOB had 16.67% of the paid up capital. In the same year Bharat Overseas Bank Ltd was created in India with 30% equity participation from IOB to take over IOB’s branch at Bangkok in Thailand. In 1977, IOB opened its branch in Seoul and the Bank opened a Foreign Currency Banking Unit in the free trade zone in Colombo in 1979.
The Bank has sponsored 3 Regional Rural Banks viz. Puri Gramya Bank, Pandyan Grama Bank, Dhenkanal Gramya Bank. The Bank setup a separate Computer Policy and Planning Department (CPPD) to implement the programme of computerisation, to develop software packages on its own and to impart training to staff members in this field.
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4.1 INTRODUCTION TO ANALYSIS
In order to extract meaningful information from the data collected, the data analysis is carried out. The data are first edited, coded and tabulated for analyzing them. The analysis can be conducted by using simple statistical tools like percentages, averages and measures of dispersion. Alternatively the collected data may be analyzed by using diagrams, graphs, charts, pictures etc. data analysis is the process of planning the data in an ordered form, combining them with the existing information and extracting from them.
Analysis means a critical examination of the assembled and grouped data for studying the characteristics of the object under study and for determining the pattern of relationship among the variables relating to it. Both quantitative and non-quantitative methods are used.
1. SAVINGS BANK ACCOUNT:
Savings bank accounts, as the name itself suggest, are intended for savings for the future. This is the most common type of account which caters to the needs of people in the society. This account promote saving habits among the people. The term saving bank accounts includes both categories of savings accounts viz, savings accounts with cheque book facility and savings account without cheque book facility.
Interest rates on savings bank account: Name of the banks
Interest rates
3.5% p.a.
IOB
Canara bank
3.5% p.a.
State bank of India
3.5% p.a.
Corporation bank
3.00% p.a.
Indian bank
3.5% p.a.
INFERENCES:
The above table shows that all the Banks Expect Corporation bank are offering interest at 3.5% p.a. on saving bank account. This shows that Corporation bank must have lost many of its customers. All the other banks are offering interest rates higher that Corporation bank. It is important to increase the interest rates on deposits to attract customers, else they will shift their investment pattern to some other modes.
INTEREST RATES ON SAVING BANK ACCOUNT
3.50% 3.40% 3.30% 3.20% 3.10% 3.00% 2.90% 2.80% 2.70% Interest rates on SB account
IOB Canara
SBI Corp
Indian
2. RECURRING DEPOSIT:
Recurring deposit is a form of term deposit in which depositor deposit a fixed sum of money by way of monthly installments over a stipulated period and on the expiry of this period, the accumulated amount along with interest accrued is paid in lump sum. Recurring deposit is suitable to persons, particularly those belonging to fixed income group, who wish to make a installment for an agreed period.
Minimum balance requirement for recurring deposit Name of the banks Canara bank State bank of India Indian bank IOB Minimum balance requirements(in Rs) 50 Rs 100Rs 05 Rs 50 Rs
INFERENCE:
The above table shows the minimum balance requirements for recurring deposit. This reveals that Indian bank is offering lowest minimum balance requirement for opening this account that is Rs 5, and SBI has highest requirement for opening this account that is Rs 100. The rest of the banks that is Canara is at Rs 50 and IOB bank at Rs 50. Indian bank has offered minimum balance to attract the middle class people in the society. All the other banks are offering different balance requirement.
2. MINIMUM BALANCE REQUIREMENT UNDER RECURRING DEPOSIT SCHEME:
100 90 80 70 60 50 40 30 20 10 0
Canara SBI Indian IOB
Minimum Balance
3. DEPOSIT SCHEME FOR SENIOR CITIZENS:
This is the account exclusively for senior citizens of the country. The purpose of this account is to provide a term deposit scheme with differential rate to senior citizens. This account is provided respecting Indian values.
Minimum balance requirement for senior citizen deposit scheme
Name of the banks Canara bank State bank of India
Minimum balance (in Rs) 1000/10000/-
Indian Overseas Bank
5000/-
INFERENCES:
The above table shows the minimum balance required to open senior citizens deposit scheme. It reveals that this scheme is offered by only SBI, Canara bank and IOB among five banks. In Canara bank minimum balance requirement for opening this account is Rs 1000 , in SBI it is Rs 10000 and in IOB it is Rs 5000/-. Canara bank has offered a minimum balance to help the senior citizen of our country to open a account in the bank. State bank and IOB have offered higher balance requirement according to the bank norms.
3.
MINIMUM
BALANCES
REQUIREMENT
FOR
SENIOUR
CITIZENS DEPOSIT SCHEME:
10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0
Canara SBI IOB
Minimum Balance
4. REINVESTMENT PLAN DEPOSIT:
This scheme provides opportunity to multiply money. This is also called as money multiplier plan. Different bank offer this scheme in different names, Indian bank provide this under the name of reinvestment plan, canara bank offer under kamadenu deposit, and corp bank under the name of kshemanidhi cash certificate
Period deposit in case of reinvestment plan
Name of the banks Corporation bank Indian bank Canara bank State bank of India Period of deposit 6 months to 10 years 6 months to 120 months 5 months to 120 months 6 months and above
INFERENCE:
The above table shows that four banks among five are offering reinvestment plan deposit scheme. It shows the period deposit for different banks. In corporation bank the period ranges from 6m to 10years, in Indian bank it is from 6m to 120 m, in Canara bank it is 5m to 120 m, and in case of SBI it is from 6m and above. Canara bank may be providing the minimum period to attract customers and other banks may be offering for retaining the existing customers.
4. PERIOD OF DEPOSIT IN REINVESTMENT PLAN SCHEME:
6 5.8 5.6 5.4 5.2 5 4.8 4.6 4.4
Corp Indian Canara IOB
Period of Deposit
5. NUMBER OF DEPOSIT SCHEMES
Name of the banks Canara Indian SBI Corp IOB
No of schemes
15 16 11 12 16
INFERENCE:
The above table shows the number deposit schemes offered by different banks. This reveals that among five banks Indian bank and IOB are offering highest number of schemes that is 16, Canara is providing 15 schemes, corporation bank is providing 12 schemes, and SBI offering 11 schemes. To attract the customer and to maintain the existing customers Indian bank and IOB has introduced the maximum schemes followed by Canara bank. Corporation bank and SBI have minimum schemes, yet they are able to play a good role in the industry.
5. NO OF DEPOSIT SCHEMES
16 14 12 10 8 6 4 2 0
Canara Indian Corp SBI IOB
No. of Deposits Schemes
6. ADDITIONAL INTERST RATE ON SENIOR CITIZEN DEPOSIT SCHEME.
Name of the Bank
Additional Interest rates
IOB
1.00%
Indian Bank
0.5%
Corporation Bank
0.5%
INFERENCE:
The above table shows the additional interest rate offered by three banks for senior citizen scheme. From the above table IOB is offering More interest rates on
deposits than Indian bank and corporation bank. IOB must have done this to help the senior citizen to have a good saving in the bank and to attract more customers for this deposit scheme.
ADDITIONAL INTERST RATE ON SENIOR CITIZEN DEPOSIT SCHEME.
1.00% 0.90% 0.80% 0.70% 0.60% 0.50% 0.40% 0.30% 0.20% 0.10% 0.00% Addational Interest rates
IOB
Indian
Corp
7. DEPOSIT SCHEME FOR CHILDREN
The deposit schemes offered by two banks for children are:
Name of the bank
Name of the scheme
Canara bank
SB canchamp Deposit Scheme
Corporation bank
Corp Junior Account
INFERENCE:
The above table shows the deposit scheme offered by Canara bank and Corporation bank for children. Canara bank is offening this SB account for children upto the age of 12. Both this banks must have introduced this scheme for the encouraging youth to have a habit of saving from younger age. All the other bans can also offer this type of scheme for children.
ANALYSIS OF VARIOUS DEPOSIT SCHEMES OFFERED BY FIVE BANKS ARE AS FOLLOWS: DEPOSIT SCHEMES OF CANARA BANK:
1. SAVINGS BANK ACCOUNT An account for individuals, non trading organisations, permitted institutions etc., Minimum Balance Requirements. For Metro, Urban and Specialised Savings Branches Rs.500/- without chequebook facility and Rs.1000/- with chequebook facility. For Semi Urban and Rural Branches Rs.100/- without chequebook facility and Rs.500/- with chequebook facility. Interest on the minimum balance in the account, between the 10th and last day of the month.
2. CURRENT ACCOUNT For traders, businessmen, corporate bodies etc. who operate the account frequently. Minimum balance : Rs.1000/- in rural and semi-urban areas. Rs. 5000/- in urban areas and metros. Not eligible for interest. No ceiling on the number of withdrawals and credits. Pass book, pass sheet, standing instructions, cheque collection facilities available.
3. FIXED DEPOSITS When you want to invest your hard earned money for a longer period of time and get a regular income, our Fixed Deposit Scheme is ideal. It is SAFE, LIQUID and FETCHES HIGH RETURNS .Investment, Minimum Rs. 1000/-. Maximum - No ceiling.
Period of Deposit, Minimum 15 days. Maximum 120 months
4. RECURRING DEPOSITS Ideal for convenient savings. Enables to build up a sizeable capital in a regular and systematic way.
Amount of Deposit As low as Rs.50/- per month ( in multiples of Rs. 50/-) No ceiling on maximum amount..
5. CANARA CENTENARY DEPOSIT SCHEME (Reinvestment Plan – interest compounded quarterly)
Deposit Amount, Deposits are opened for a fixed period of one year. Maximum no maximum limit
Period of Deposit , Minimum Rs.10,000/- and in multiples of Rs.1,000/- there above
Rate of Interest General Public : 9.50% Senior Citizens : 10.00%
6. CANARA CENTENARY (FIXED DEPOSIT) SCHEME
Deposit Amount,
Minimum Rs.10,000/- and in multiples of Rs.1,000/- there above.
Maximum no maximum limit
Period of Deposit , Deposits are opened for a fixed period of one year
Rate of Interest General Public : 9.50% Senior Citizens : 10.00%
7. CANRELAX SCHEME Basically a term deposit with benefits of annuity scheme. Deposit under the scheme can be opened by an individual in his / her name, Illiterate/blind persons .More than one individual (but not more than four) in their names payable 'to all of them jointly', or 'to anyone or more of them or survivor/s or no.1 or survivor/s. A guardian on behalf of minor on furnishing a declaration as to the date of birth of the minor. Minimum deposit amount would be Rs.1,00,000/- and in the multiples of 10,000/thereafter. There is no maximum ceiling under the scheme. An additional interest of
0.50% over the rate applicable on term deposits of 5 years and above, on monthly discounted value basis is extended on Canrelax deposits
8. SB CANCHAMP DEPOSIT SCHEME Basically an SB deposit for children. Children upto the age of 12 years (i.e. till 11 years, 364 days). Initial deposit can be any nominal amount with a minimum of Rs.100/-. As applicable to SB deposits. Presently 3.5% per annum. Cheque books are not issued under the scheme. Joint accounts cannot be opened under the scheme.
9. KAMADHENU DEPOSITS Apart from safety & liquidity, it offers you the highest growth option. (compound interest) Investment, Minimum Rs. 1000/-, Maximum - No ceiling. Period of Deposit , Minimum 5 months, Maximum 120 months
10. CANBANK AUTO RENEWAL DEPOSIT CARD is a self-propelled phenomenon that rotates your deposits to fetch higher returns. Period of deposit: 15 days to 46 days. Auto renewal : CARD has built-in features for automatic renewal of the deposit, with or without interest accrued. Loans against deposits permissible. Closure before maturity permissible. Nomination facility available.
11. CANFLEXI DEPOSITS A combination of Savings Account and Fixed Deposit, CANFLEXI enables you to earn maximum interest. Automatic transfer of funds beyond Rs.15,000/- from your Savings Bank account to an automatically created Fixed Deposit in multiples of Rs. 1000/-, earning you more interest.
12. ASHRAYA DEPOSITS (for senior citizens) Individuals, who have completed the age of 60 years and above, in single or joint names. ccounts can be opened jointly with other Senior Citizens or with other persons below the age of 60 subject to the condition that the Senior Citizen is No.1 depositor.
Investment is minimum of Rs 1000/- and maximum has no celing.period of deposit is 15 days to 120 months.
13. FLOATING RATE DEPOSIT SCHEME To provide a deposit scheme with a floating interest rate linked 91 days T-Bill rate. To provide the depositor an option to invest in floating rate deposit scheme to take advantage of interest rate fluctuation. ndividuals both single or joint account(‘either or survivor’ OR ‘jointly’) High Networth Customers, both sigle or joint account(‘either or survivor’ or ‘jointly’),A guardian on behalf of minor HUF, Partnership firm, Company, Trusts, Association or any other institution.
Minimum Rs.10 lakhs and in multiples of Rs.1 lakh, thereafter. There is no maximum ceiling. ixed Deposit only(no reinvestment). inimum 6 months and Maximum of 24 months. Deposits can be made in multiples of month.
14. CANSARAL SAVINGS ACCOUNT A ‘No Frills’ savings bank account for the common man. Scheme introduced to give a fillip to the Financial Inclusion objective. To comply with simplified KYC norms. Balance not exceed Rs.50,000/- at any point of time in all deposit accounts taken together and total credits in all accounts not to exceed Rs.1,00,000/- in a financial year. Initial deposit Rs.25/-. Account can be maintained even with zero balance.
15. CAN - TAX SAVER Deposits – Can-Tax Saver Scheme Basically, a term deposit scheme under the Fixed Deposit & Kamadhenu streams of the Bank, with the benefits of; deduction from income upto Rs.1 lakh under Sec.80C of The I T Act, 1961; Only Individuals can open this account. Individual Account - can be in the name of the individual for himself or in the capacity of the Karta of a Hindu undivided family (HUF) .Joint Account - can be opened by only two adults jointly or an adult and a minor, and payable to either of the holders or to the survivor.
We can invest a Minimum - Rs.100/-(In multiples of Rs.100/- thereafter) and a Maximum
- Rs.1,00,000/- per person.
Rate of Interest is 9.25% per annum for General Public and 9.75% p.a. for Senior Citizen
INTEREST ON DEPOSITS Savings Bank ( including NRO/NRE SB a/cs) 3.5 % p.a.
Domestic Term Deposits W.E.F. 12.02.2007
RATE OF INTEREST (%) P.A. – W.E.F. 12.02.2007 Less than Rs.15 lakhs Employees/ ExPeriod employees/Exof employees-Senior deposit Base Senior Citizens & other Rate Citizens categories eligible for preferential interest rates 7 days 4.00* 4.50* 5.00* to 14 days 15 days 4.75 5.25 5.75 to 45 days 46 days 5.50 6.00 6.50 to 90 days 91 days 6.00 6.50 7.00 to 179 Single bulk domestic term deposit of Rs.15 lakhs & above up to and inclusive of Rs.2 crores 4.00
5.00
6.00 7.25
days 180 days to less than 1 year 1 year & above to less than 2 years 2 years & above to less than 3 years 3 years & above to less than 5 years 5 years & above
7.00
7.50
8.00
7.75
8.25
8.75
9.25
8.50
8.50
9.00
9.00
8.55
9.00
9.50
9.50
9.05
8.50
9.00
9.00
8.55
•
Only for single deposit of Rs.5 lakhs & above
DEPOSITE SCHEMES OF STATE BANK OF INDIA 1. SAVING BANK ACCOUNT
SBI’S Saving Bank Account helps to plan and save for the future financial requirements. The savings remain liquid, safe and earn moderate interest. Getting Free ATM cum Debit Card and have access to the widest network of over 5500 ATMs across the country to withdraw cash, enquire about your balance, etc. Moreover, your card enables you to shop at more than 23,000 Merchant Establishments in India. You can also avail yourself of our International ATM-cum-Debit Card, which can be used within as well as outside India, at a nominal fee.
2. TERM DEPOSITS
Now we can earn a higher income on your surplus funds by investing those with us. Providing security, trust and competitive rate of interest.: Flexibility in period of term deposit from 7 days to 10 years. Affordable Low Minimum Deposit Amount: You can open a term deposit with SBI for a nominal amount of Rs.1000/- only. Please check our Interest Rates online or simply email through our Helpline. Flexibility in choosing the amount you wish to invest and the maturity period.
3. CURRENT ACCOUNT
A Current Account would entitle you to make unlimited number of payments. Through a pre-arranged limit you can also enjoy the security of a check payment guarantee, should your balance in the account be insufficient for the payment of a cheque. Interest on the overdrawn amount is levied only for the days the account is overdrawn.
4. SPECIAL TERM DEPOSITS
This plan helps you to earn interest on interest, thus giving you a two-fold income. You deposit your money with us for any period between six months to 10 years, and we pay you interest on your deposited money plus on the interest you earn. Thus your interest gets compounded every quarter giving you higher returns.
5. MULTI OPTION DEPOSIT SCHEME
The Multi Option Deposit (MOD) Account is a combination of Savings Bank or Current Account with Term/ Special Term Deposit Accounts, so that one can securely write cheques upto the balance in the MOD account or upto the drawing power available as overdraft in the Current account.
6. SUPER SAVER TERM DEPOSIT SCHEME
This scheme is introduced to offer higher rate of interest for long term deposits. Resident Individuals are eligible for this scheme. Minimum Deposit of Rs. 10,000/- and in multiples of Rs.1000/- thereafter. Types of accounts are, Term Deposit (TD) account / Special Term Deposit (STD) account
7. .SAVINGS PLUS ACCOUNTS
At our computerised branches, you also have the option of a special savings account, Savings Plus, where you earn interest at term deposit rates on balances exceeding a predetermined limit. The limit is set by you (minimum requirement is Rs.10,000) and the period of the term deposits is also selected by you (over a wide range of 6 - 36 months). The investments are made by us automatically. Your funds are, therefore, never idle - you earn interest even while you sleep. As all term deposits are created under SBIMODS you enjoy high liquidity with high interest.
8. SBI PLATINUM ACCOUNT
The Purpose is to offer a distinct special term deposit product to customers with higher rate of interest. Eligibility Residents, including minors and NRIs. Mode of Holding Singly or jointly or (Either or Survivor) Type of account Special Term Deposit (STD) account with 'put option'Period of deposit 3 years, with a lock -in period of 1 year.
Rate of interest The deposit will carry maximum interest for General public at 9% p.a. payable on the full term maturity.
9. RECURRING DEPOSIT Bank offer a fixed installment RD where you can arrange with us, at no cost, to automatically transfer funds every month from your SB or current account to your RD account. We can start a Recurring Deposit with SBI for a monthly instalment of Rs.100/only. Low minimum monthly deposit amount. Flexibility in period of deposit with maturity ranging from 12 months to 120 months.
10. BASIC BANKING -NO FRILLS ACCOUNT
This account comes with very low minimum balances as well as low/ nil charges, to cater to the needs of individuals from the vast sections of population who are, otherwise, not fulfilling certain conditions of our existing Savings Bank account requirements. Individuals of 18 years and above earning a gross income of Rs.5000/- p.m or less. Rs.50/- to open the account. There is no minimum balance. Maximum balance of Rs.10,000/-, being the total value of business connection of the account holder, including other deposit accounts. Rate of interest as applicable to Savings Bank accounts, if a minimum balance of Rs.500/- or more is maintained.
11. SENIOR CITIZEN DEPOSIT SCHEME
To provide a term deposit scheme with differential rate to senior citizens. Senior citizens i.e. residents with age of 60 years or above on the date of acceptance of deposit. Type of deposit is Term deposit / Special Term Deposit. Tenure of deposit is 1 year and above. Minimum amount Rs.10000 and thereafter in multiples of Rs.1000
INTEREST RATES ON DEPOSITS
Saving bank account - 3.5%
DOMESTIC TERM DEPOSIT
W.E.F. 22.02.2007
Duration Interest Rate (% p.a.) 3.75* 5.00 5.50 6.50 8.25 8.25 8.25
7 days to 14 days 15 days to 45 days 46 days to 179 days 180 days to less than 1 year 1 year to less than 3 years 3 years to less than 5 years 5 years and up to 10 years
*Term deposits for maturity period of “7 days to 14 days” shall be accepted for amounts of Rs. 1 Crore and above.
DEPOSITS OF SENIOR CITIZENS (Age 60 years and above) MATURITY PERIOD Interest Rates (% p.a) Revised w.e.f. 11th December 2006 8.00 8.25 8.50
1 year to less than 3years 3 years to less than 5 Years 5 Years and up to 10 years
REINVESTMENT PLAN
STANDARD TABLE FOR MATURITY VALUES OF A SPECIAL TERM DEPOSIT of Rs. 100/- w.e.f. 11th December, 2006
Period in Months 6 9 12 24 36 48 60 72 84 96 108 120
Maturity value as per IBA MASTER CHART (4 decimal) PUBLIC 103.2764 104.9546 107.7136 116.0222 125.8948 135.9389 148.5947 160.8437 174.1024 188.4541 203.9887 220.8040 STAFF 103.7852 105.7311 108.7748 118.3196 129.6502 141.3723 156.0509 170.5767 186.4545 203.8103 222.7816 243.5189
NOTE: 1. Interest has been compounded on the deposits at quarterly intervals 2. The rate of interest for public is 6.50% p.a. for period of 6 months and over but less than 1 year, 7.50% p.a. for 1 year and over but less than 3 years, 7.75% p.a., for 3 years and over but less than 5 years and 8.00% p.a. for 5 years and up to 10 years.
DEPOSITE SCHEMES OF INDIAN BANK
1. SAVING BANK ACCOUNT
Savings Bank accounts are suitable for inculcating the habit of savings among the customers. It offers liquidity for the money and also earns interest. Savings Bank accounts can be opened in the name of individuals, singly or jointly, minors of 14 years of age and HUF. Minimum balances are prescribed for ordinary as well as cheque operated Savings Bank accounts. Interest is credited to the account every half-yearly viz. as on 31st January and 31st July. There is no ceiling on the maximum balance earning interest on Savings Bank accounts. The accounts can be operated by Withdrawal slips or by Cheques. 50 withdrawals per half year are permitted free of charge. 2 Cheque books of 20 leaves each are issued to the customer free of charge in a year. Standing instructions are accepted for payment of insurance premia, school fees, etc., at a very nominal charge. No charges will be levied for standing instructions within the Branch such as payment of monthly instalment of Recurring Deposit etc.. Local as well as outstation cheques, dividend warrants, interest warrants and pension payable to the account-holder are collected. Lesser minimum balance is prescribed for pensioners. Nomination facilities are available. ATM cards are provided free of cost if the depositor maintains prescribed minimum balance. No TDS on interest earned in the SB account. Transfer of account from one branch to another branch free of charge
2. CURRENT ACCOUNT
Current accounts can be opened in the names of individuals (singly or jointly), proprietory concerns, partnerships, companies etc. Minimum balance is prescribed on this type of account and the account is operated by cheque. Though no interest is payable on this type of account, there is no restriction on the number of transactions.
Issue of cheque book at a nominal cost of Rs.3/- per leaf. Folio charges free on maintenance of certain balance in the account. Free manual/computerised statement of account every month. Collection of local cheques free and collection of outstation cheques through special schemes like Expressway, Cash Management Service etc. Cheque BP/withdrawal against uncleared effects as per prescribed norms.
The Bank undertakes collection of bills, cheques, hundies, pension bills etc., as per instructions of the customers, subject to levy of a nominal service charge. Standing instructions of the customers are also accepted. Nomination for individual/sole proprietary accounts. Trade finance scheme available. DD shoppe/extended business hours/7 days week etc. are other facilities available.
3. FIXED DEPOSITE Fixed Deposits are accepted for a minimum amount of Rs.100/- with minimum period of 7* days and a maximum period of 120 months. No ceiling for maximum amount of deposit. Interest is paid every quarter. Monthly interest can also be paid at a discounted
rate. Interest payable on Fixed Deposit can also be transferred to Savings Bank or Current Account of the customer. Facilities for loan, foreclosure, nomination etc. are available.
4.INDSTAR DEPOSITE Fixed Deposits placed for short term periods i.e. 7* days to 180 days will be renewed automatically, on the due date, on the basis of the request from the depositor for the same tenor as that of the original deposit for a maximum of 6 times. The customer need not present the deposit receipt every time for renewal. The customer has the option to withdraw the periodical interest or to renew along with the principal
5. UNIT DEPOSITE This scheme offers higher returns and liquidity too. Unit Deposits are Fixed Deposits with a difference : part withdrawals are allowed. Unit Deposits are accepted in units of Rs.1,000 for periods of one year and above upto a maximum of 120 months. Part withdrawals are allowed in multiples of Rs. 1,000 in these accounts without foreclosing the entire deposit. On part withdrawals, interest will be paid on the amounts so withdrawn as per the rules applicable for foreclosure of deposits. The balance amount of units will continue to earn interest at the contracted rate. There is no restriction on number of withdrawals. No interval required between withdrawals. Loan can be availed No withdrawals when loan is outstanding. A Passbook will be issued by the bank. Interest on Unit Deposits will be at the rates applicable to Fixed Deposits
6. FACILITY DEPOSITE Indian Bank's "user friendly" Facility deposit combines the advantage of Fixed deposit with the flexibility of an Overdraft against the Deposit. A fixed deposit or reinvestment deposit, with a minimum of Rs.1000/- or more, in multiples of Rs. 1,000 is to be made for a minimum period of 1 year and a maximum period of 3 years. A cheque book will be issued to the customer to enable the depositor to draw at any time upto 90% of the initial Deposit as Overdraft, at a rate 2% over the interest rate payable on Fixed Deposits or at rates as prescribed the Bank from time to time. No folio/cheque leaf charges will be levied. The customer has to give option either for withdrawal of interest on renewal or for renewal of principal+interest
7. REINVESTMENT PLAN DEPOSIT. Reinvestment Plan Deposits (RIP) are accepted for a minimum amount of Rs.100/- and in multiples of Rs.100/- for minimum period of 6 months and a maximum period of 120 months. No ceiling for maximum amount of deposit. Savings grow faster under RIP as the interest is compounded quarterly. At the end of the stipulated period a much larger amount is paid. Facilities for loan, foreclosure, nomination etc. are available
8. CASH CERTIFICATES Indian Bank's Cash Certificate is another pleasant proposition similar to RIP. Interest earned will be reinvested at quarterly rests to yield compunded interest. The maturity
amounts are in lumpsum in multiples of Rs.100. Cash Certificates are accepted for a minimum period of 6 months and a maximum period of 120 months
9. RECURRING DEPOSITES Recurring Deposit is a scheme drawn specially to suit the needs of the individuals, particularly the salaried class, small traders etc., to plan their savings to meet specific demands. Recurring Deposit account can be opened with a monthly instalment of mere Rs. 5 or in multiples thereof, for a period of 6 months and in multiples of 3 months upto a maximum of 120 months. The depositor will get the instalment amount along with the interest on the due date. Facilities for Loan, foreclosure, nomination are available
10. VIDHYA NIDHIN DEPOSITE In order to help the customers, particularly the middle income group like salaried class, small traders etc., to plan their savings and to make a financial provision well in advance to meet the future expenditure like the educational expenses of their children, specific purposes like investments, payment of annual instalments, a unique scheme called "Vidhya Nidhi Deposit" has been launched in our Bank. Under the scheme, deposits are accepted every month for specified periods like 36 months, 48 months or 60 months and the maturity value is paid to the customer in 3, 4 or 5 annual instalments respectively with further interest. The RD on completion of 3/4/5 years, as the case may be, shall be treated as RIP and will continue to earn interest at the same contracted rate, on the balance after annual payemnt. The customer is having an option to choose the amount of
annual instalments required by him and the plan period. For fixing the rate of interest, the whlole term of deposit including the repayment period shall be taken into account
11. IB TAX SAVER SCHEME Central Government vide notification 203 of 2006 dt 28.7.2006 has formulated a Bank Term Deposit Scheme which would be eligible for deduction under Section 80 C of the Income Tax Act. IB Tax Saver Scheme has been launched based on the notification of Central Government. The minimum amount is Rs.100 or in multiples of Rs.100 and the maximum amount is Rs.1,00,000 in a financial year. Individuals or Hindu Undivided Family(HUF) having Permanent Account Number (PAN) can deposit under this scheme under Fixed Deposit or Reinvestment Plan schemes. Joint accounts are permitted but the benefit under Section 80C of IT Act are available to the first person. The scheme is for a period of 5 to 10 years. Term deposit shall not be pledged to secure loan or as security to any other asset for a period of 5 years from the date of deposit . Foreclosure not allowed before the expiry of 5 years from the date of deposit. TDS on deposits as per Section 194A /195 of the Income Tax Act
12. VIKAS SAVING KHATA The Savings Bank scheme is for the financial inclusion of those who have been hitherto deprived of banking facility .The account can be opened with no initial / minimum balance in Savings Bank account with relaxed KYC procedures. The account holder can operate the account with withdrawal slip accompanied by pass book.10 transactions in a month is allowed free of charges and above this limit , a small service charge is
prescribed. One DD/BPO is issued free of commission in a month and ATM card is issued and the customer can withdraw upto available balance in the account. Value added services like internet banking etc are available once the customer fulfill full KYC procedures and maintain the minimum balance requirements
13. AUTOMATIC RENEWAL of DOMESTIC TERM DEPOSITE The automatic renewal of term deposits is available for the following schemes viz Short term deposits, Fixed Deposits, RIP, Cash Certificate, Unit Deposit, Facility Deposit, Special Scheme for Senior Citizens with effect from 1.11.2005.
Fresh term deposits opened on or after 1.11.2005 or the accounts which falls due on or after 1.11.2005 are covered under this facility and the term deposits are renewed for equal period of the term deposit subject to a maximum of one year in the absence of any instructions upto the due date of the original deposit. The customer can vary the period etc within 14 days from the renewal of deposits. In the case of RIP, net of TDS amount of maturity value will be renewed.
14. SPECIAL DEPOSITE SCHEME FOR SENIOR CITIZEN Senior Citizens who have completed the age of 60 years can open the deposit account under this scheme by providing age proof for the first time only . Joint account can also be permitted provided the first named person should be the Senior Citizens. The scheme may be opened under STD/Fixed Deposit/RIP scheme and can earn 0.50% additional rate over the card rate payable for amount of less than Rs. 15 lakhs. The period of deposit is from 15 days to 10 years
15. HEALTH PLUS SAVING A Scheme designed to take care of your health. Maintain a minimum balance of Rs.5000 in this special account. A Free family Health Plus Savings Card will be issued to the account holder with photograph of the account holder affixed and the names of eligible family members. Discount on Master Medical Check-up and some other diagnostic services as extended by some selected hospitals will be available on producing health plus saving card at prescribed hospitals to the customer's choice on any number of occasions.
16. ADVANTAGE ACCOUNT An innovative Current Account, perfectly tailor-made to suit your high value business. Advantage Account offers a wide range of customer friendly services with a whole lot of following benefits: Operative in selected computerised branches in Chennai, Coimbatore, Bangalore, Hyderabad, Mumbai, Pune, Ahmedabad and Kolkata. Initial deposit for opening the account if Rs.One lakh. DDs/BPOs at par upto Rs.2.00 lakhs and Free ATM card for individuals. Instant credit of outstation cheques for an amount upto Rs.20,000/-. Faster collection of outstation cheques between selected centres. EFT between 4 metros upto Rs.5.00 lakhs at Rs.25/- per transaction. Free ATM card for individuals Extended business hours for non cash transaction at computerised branches Nominal penal charges in case of non maintenance of balance.
INTEREST RATES ON DEPOSITS
Saving Bank Account - 3.5 %
DOMESTIC TERM DEPOSIT
W.E.F. 01.03.2007
Applicable rates of interest with effect from 01.03.2007 % (p.a.) Period For less than Rs.15 lakhs For Rs.15 lakhs to less than Rs.1 Crore Rate of interest 7 days to 14 days 15 days to 29 days 30 days to 45 days 46 days to 90 days 91 days to 180 days 181 days to 365 days over 1 year to 2 years Over 2 years to 3 years Over 3 years to 5 years Over 5 years to 3.50* Annualised yield # 3.50 Rate of interest 4.00 Annualised yield # 4.00
4.50
4.50
4.50
4.50
5.00
5.00
5.25
5.25
5.50
5.50
5.75
5.75
6.50
6.55
6.50
6.55
8.75
9.04
8.75
9.04
9.00
9.74
9.00
9.74
9.00
10.20
9.00
10.20
8.75 8.50
10.83 13.19
8.75 8.50
10.83 13.19
10 years
* Minimum deposit Rs. 1 lakh. # annualized yield calculated at the upper band of each slab
DEPOSITE SCHEMES OF CORPORATION BANK 1. SAVING BANK ACCOUNT
The deposit for everyday use. Highly liquid (money can be withdrawn in a matter of minutes), convenience account with or without cheque facility. Half yearly interest is earned on the minimum balance you maintain in the account. We can also avail of special services like executing your regular payments, funds transfer, collection of local and outstation cheques, etc.
2. CURRENT ACCOUNT
Current Account is primarily meant for businessmen, firms, companies, public enterprises etc. that have numerous daily banking transactions. In a Current Account, a customer can deposit any amount of money any number of times. He can also withdraw any amount as many times as he wants, as long as he has funds to his credit. Current Accounts are meant neither for the purpose of earning interest nor for the purpose of Savings but only for convenience of the business.
3. TERM DEPOSITES
i.
Kshemanidhi Cash Certificates - KCC
KCC is a money multiplier deposit - it is a reinvestment Term Deposit scheme that can be opened for a period ranging from 6 months to 10 years. It is a money multiplier deposit where the deposit amount grows rapidly as interest is
compounded quarterly. The rate of interest depends on the period of deposit
ii.
Money Flex
The flexible Term Deposit - it is a friendly, flexible fixed deposit scheme that won't block your money for the full term of the deposit. The scheme allows you to withdraw your money whenever you please. The deposit can be made for a period ranging from 6 to 120 months. The minimum deposit is Rs. 5,000. Additional deposits can be made in multiples of Rs.1,000
iii. Fixed Deposit The high returns deposit - it is the high return term deposit scheme and interest can be paid at regular intervals viz. monthly, quarterly, half yearly or yearly. The deposit can be made for periods ranging from 15 days to 10 years. The rate of interest depends on the period of deposit. It is an ideal deposit scheme for those who can plan for regular income.
iv CROP CLASSIC ACCOUNT
High Returns, Totally Liquid - It is an innovative technology-based account that combines the hi-liquidity of a Savings Bank account and the hi-returns of a Term Deposit to give you the best returns for your money. It is completely hands-free and fully computerised, carrying out all your transactions on standing instructions.
CorpClassic 'fixes' Term Deposit in units of Rs. 1000/- each, on a 'period', 'interest rate' or 'due date' basis, whichever you prefer. The interest can either be withdrawn or compounded as you wish. Rest assured, that while 'unfixing' the units, kept in the Term Deposit, CorpClassic ensures that you optimise your earnings with the minimum interest loss.
4. RECURRING DEPOSIT
Every drop counts - An ideal way to plan for future needs. Best suited to the salaried class, you can save a fixed sum every month for a period ranging from 12 months to 120 months. You get a lumpsum amount on maturity. Minimum amount of deposit is Rs 50/p.m. in Rural and Semi - Urban places and Rs 100/- p.m. in all other places and thereafter in mulltiples of Rs 25/-. There is no maximum limit.
The rate of interest depends on the period of deposit and it is compounded quarterly. Interest is paid annually and is ploughed back into principal every year.
5.JANATHA DEPOSIT
The bank at your door step. This deposit is for a period from 1 to 5 years. Our collection agent will call at your place to collect your savings at regular intervals even daily. Your small saving thus accumulate into a substantial amount over the deposit period
6. CORP GOLD
Corp Bank, with strong fundamentals and experience/expertise in handling bullion business, is one of the few Banks that have been permitted to launch the scheme. The key features of the Corp Gold Deposit Scheme are:
Resident Indians can invest under the scheme Gold (bars, coins, jewellery, etc.) is accepted in scrap form Maturity period 3 to 7 years Rate if interest – depends on the maturity pattern Premature withdrawal after the lock-in-period is permitted Redemption in standard 995 fineness gold or in rupees permissible Multiple Certificates for different denominations available Facility of Nomination is available Rupee loans permitted against the collateral of Deposit Certificate
9. PREMIUM DEPOSIT:
The deposit for a secure tomorrow. Start saving a minimum of Rs.100 per month for a period from 1 year to 10 years. On completion of that period, the deposit with interest is reinvested in minimum blocks to give maximum interest, at the rate prevailing then, and converted into a corpus of your choice.
10. CONTINUOUS DEPOSIT:
The cluster deposit. Here you choose between simple interest and compound interest while keeping your deposits in a cluster form. Continue to deposit, any amount, any number of times. All deposits will be recorded in one account in a pass book making it easy for you to keep track of your deposits. No hassles of having numerous deposit receipts.
11. READY CASH DEPOSIT:
The high returns, high liquidity deposit. It is a fixed deposit scheme with a cheque facility to withdraw whenever you want. Under the scheme, you can deposit a minimum of Rs. 5000 for a period ranging from 12 months to 36 months. The rate of interest depends on the period of deposit. While your deposit earns at the agreed rate of interest, you can withdraw your money through cheques. You need to pay interest in the amount withdrawn as per the rates fixed by the Bank.
12. HOME LOAN ACCOUNT:
The deposit that builds home . Save as much as you can at regular intervals in the special home loan account. After 5 years, you will be eligible to take a loan in multiples of your entire savings with interest. This gives you tax concessions on both savings as well as interest earned, under Sec. 88 of Income Tax Act.
INTEREST RATES ON DEPOSITS Saving Bank Account ( including NRE) - 3.5 %
DOMESTIC TERM DEPOSIT W.E.F. 31.03.2007
Duration 7 days to 14 days 15 days to 29 days 30 days to 45 days 46 days to 90 days 91 days to 179 days 180 days to less than 1 year 1 year to less than 18 months 18 months to less than 2 years 2 years to less than 3 years 3 years only More than 3 years to less than 5 years 5 years and above Less than Rs.15 lacs 4.75 5.25 5.50 6.75 7.50 8.50 9.25 8.50 9.50 8.50 9.00
Capital Gains Account Scheme
Category A account (SB) Category B account (Term Deposits)
3.5 % p.a. As per rates for domestic term deposits
DEPOSITS SCHEMES OF INDIAN OVERSEAS BANK
1. SAVING BANK DEPOSIT
Saving bank account can be opened individually or jointly with others. S.B. account holders who maintain an average quarterly balance of Rs.10,000 and above in the account will qualify for the value additions. For arriving at the average balance, calender quarter immediately preceding the date of transaction will be taken into account.
2. CURRENT ACCOUNT
All firms, corporate bodies, traders and individuals with a profit-making motive, where the transactions are frequent can apply for a Current Account. Current accounts with quarterly average balance of Rs.25,000 are eligible for the following benefits in the next quarter. We need to maintain a minimum balance of Rs. 2,000/- for branches in Metro and urban areas. Rs. 1,000/- in other branches. For Regd. Tiny Sector and Village & Cottage Industries it is Rs. 1,000/- at all branches. You will be charged Rs. 2/- per MICR cheque leaf and Re. 1/- per non-MICR cheque leaf. While all efforts have been made to update the information, constituents are requested to contact the branches.
3.FIXED DEPOSITS
Individuals and organizations with the intention of retaining their savings for a fixed period for some future use. A fixed deposit account allows you to deposit your money for
a set period of time, thereby earning you a higher rate of interest in return. Fixed deposits also give you a higher rate of interest than a savings bank account. . 4. REINVESTMENT DEPOSIT A Reinvestment Deposit Plan basically allows you to reinvest the interest earned on your deposit. If we would like to retain our deposits and accumulate it with interest, you can apply for a Reinvestment Deposit Plan. The interest on your deposit also earns interest One can avail loans of upto 85% on the principal and also on the interest accrued You can close your deposit prematurely without any difficulty The minimum deposit amount is Rs. 1,000/-. Initially deposits should be made only in multiples of Rs. 100/-. Renewals can be made in any amount. One could use these deposits to meet any expenditure in the future... children's education, marriage etc.
5 .RECURRING DEPOSIT ACCOUNT The people who can open a recurring deposit account are , salaried individual, small trader, housewife, student or a rural saver. If we have a limited or stipulated income and require a large amount of money but can only save small amounts every month. Interest is compounded every quarter. Variable deposit periods ranging from 6 months to 120 months. We can avail loans of upto 85% on the principal and also on the interest accrued Wecan close your deposit prematurely without any difficulty. The minimum deposit is Rs. 50/- per month in multiples of Rs. 5/-.
6. MULTIPLE INVESTMENT SCHEME A Multiple Investment is a scheme where you deposit varied amounts of money whenever possible. There is no restriction on the amount or the regularity of the deposit. We can apply this scheme if we are; A Multiple Investment is a scheme where you deposit varied amounts of money whenever possible. There is no restriction on the amount or the regularity of the deposit. We can open this scheme if we are, a salaried person, professional & self-employed, small trader, an agriculturist.
7. CUMULATIVE BENEFIT DEPOSIT The Cumulative Benefit Deposit Scheme combines the benefits of the R.D. and R.D.P. Our savings are accumulated in the form of R.D. and reinvested after the desired period in R.D.P. The people who can open this account are ; Professionals & Self-employed, Housewives, Students, Small savers, Salaried persons, The minimum deposit is Rs. 100/-. Higher deposits should be in multiples of Rs. 5/-. We don’t have to pay any penal interest if the R.D. account is closed after the 1st stage.
8. MULTIPLE DEPOSIT ACCOUNT 1 We can open this account if we are; Small trader, a salaried professional. We can make deposits in units of Rs. 100/-. The minimum deposit is Rs. 100/-. We can deposit money into this account whenever you want. The deposit period ranges from a minimum of 6 months to a maximum of 10 years. No need for carrying numerous receipts. The entries are made in a special passbook, which you will be given.
9. WEDDING DEPOSIT IOB offers a wedding deposit scheme for wedding . the persons who can open this scheme are; Professionals & Self-employed , Small traders , Salaried persons. The minimum monthly deposit is Rs. 50/-. Higher deposits should be in multiples of Rs. 5/.We can make deposits for 63, 84, 120 months. The instalments increase by the amount of initial deposit after the completion of every year.
10. VARSHIK AAI YOJANA If we have to meet annual expenses like taxes, education, annual insurance premia etc., we could apply for a Varshik Aai Yojna Deposit. Persons who can open this scheme are; Salaried persons, Professionals & Self-employed, Small traders can apply for this
deposit. The minimum deposit is Rs. 1,000/-.
11. EDUCATION DEPOSIT One can use this deposit for the higher education of their children. The persons who can apply for this scheme are; Professionals & Self-employed, Small trader, Rural saver, a salaried person,. It is a variation of the Recurring deposit scheme. The minimum monthly deposit is Rs. 250/- for 63 months and Rs. 350/- for 84 months.
12. VARDHAN – DEPOSIT FOR SENIOR CITIZEN Any individual who has completed 60 years of age is treated as Senior Citizen for the purpose of opening account under Vardhan scheme. Age can be verified by calling for any one of the following document:
13. FLOATING RATE DEPOSIT SCHEME Any individual either singly or jointly with others, a natural / legal guardian on behalf of a minor, Hindu Undivided Families, Trusts, companies, firms are eligible to participate in the scheme. Deposits are accepted for period of 3 years and up to a maximum of 10 years. The minimum deposit amount accepted under the scheme is Rs.1 lac and in multiples of Rs.10,000/- thereafter. There is no upper ceiling for the amount of deposit.
14. SANJEEVI DEPOSIT We should be a deposit account holder with a minimum deposit of Rs. 10, 000/-. We can apply for a Sanjeevi Deposit Scheme if you have an existing term deposit account. An overdraft facility of up to 85% of your deposit with accrued interest. Higher interest rates. We have the option to withdraw a part of the deposit, anytime. The deposited amounts could be withdrawn using a cheque facility. A cheque facility can be availed by opening a Current A/C with a minimum of Rs. 101.
15. GOLD DEPOSIT The objective of this scheme is to provide opportunity to depositors to earn interest on their idle gold holdings along with the benefits of safety and security without any cost. To mobilize a portion of the privately held stock of gold in the country and putting it into productive use. The persons who can open this scheme are; Resident Indians
(Individuals, HUF, Trusts and Companies), Joint depositors, Resident minor by a natural or legal guardian,
Minimum Deposit is 250 grams (gross weight). Period of deposit will be either 3, 4 or 5 years. Rate of Interest is 3 years to 5 years 0.50% p.a.
15. EASY DEPOSIT This account is opened by; Salaried individual, Professional, Student... wanting to save money in flexible and convenient monthly instalments, Housewife or a Small trader. We can get a loan of up to 85% on your deposit with the accrued interest. The chosen amount will be the core amount and you can deposit up to ten times of the core amount every month. The interest and your investment will be repaid at the end of a period specified by you, ranging from 6 months to 10 years. We can receive a monthly interest depending on the minimum balance in your account between the 10th and the last day of the month Premature closure of the deposit is permitte
16. PERMENANT INCOME PLAN It is a 2-stage process combining the Recurring deposit and Special Fixed deposit. The minimum monthly deposit is Rs. 50/-. Higher deposits should be in multiples of Rs. 5/-. In the 1st Stage, you pay a monthly fixed instalment for 5 - 8 years. In the 2nd Stage, the interest accrued on your deposit is paid when the 1st Stage is completed. You can receive your payments in monthly or quarterly intervals for 59, 35 or 23 months plus an annual bonus. You can avail loans up to 85% of investment and accrued interest The minimum monthly deposit is Rs. 50/-. Higher deposits should be in multiples of Rs. 5/-.during the 1st Stage and 85% of the corpus amount during stage II. You can close your deposit prematurely.
INTEREST RATES ON VARIOUS DEPOSITS
Saving Bank Account (including NRE & NRO saving account)
- 3.5 %
Domestic Term Deposits Period of deposit Deposits up to Rs.25 lakh valid 15.2.2007 to 30.4.2007 3.50 4.00 4.75 5.25 5.25 6.00 6.75 7.25 8.50 9.00 9.00 9.00 9.00 9.25 Int.rate for >Rs.25 lakh
7 days to 14 days (Applicable for deposits of Rs.1.00 lakh and above) 15 days to 29 days 30 days to 45 days 46 days to 60 days 61 days to 90 days 91 days to 180 days 181 days to 270 days 271 days to less than 12 months 12 months to less than 18 months 18 months to less than 24 months 24 months to less than 30 months 30 months to less than 36 months 36 months to less than 42 months 42 months and above
3.50 4.00 4.75 5.25 5.25 6.00 6.75 7.00 7.50 7.50 7.60 7.70 7.75 7.75
*Deposit for 18 months and above will have lock in period of 12 months. Premature closure after 12 months will fetch interest at the rate of 8.50% for the period the deposit remained with the bank.
5.1 FINDINGS
Due to low interest rates offered by the bank, people’s interest on investment has been changed to stock exchange, and other investments which gives higher return. In case of deposit mobilization, Indian bank and IOB have taken effort to increase their deposit schemes. All the other three banks have to increase their deposit schemes. Most of the customers from rural area who are illiterate do not know about the various schemes offered by the banks even thaw they have enough money to deposit. This losses the business of the banks and also the rural people will not have the habit of saving. In case of recurring deposit scheme Indian bank is offering the minimum balance requirement. All the banks are offering scheme for senior citizen. This helps the old age people in our society to invest. But SBI is offering a highest minimum balance which all senior citizen can afford. Canara bank and corporation bank has started deposit scheme for children. This enables the children to have a habit of saving in present and for future.
5.2 SUGGESTIONS AND RECOMMENDATIONS
After analysis the following suggestions are considered to be worth while:
•
It is suggested for all these five banks to increase their interest rate on deposit to have more number of customers. Interest of people in investment has increased towards stock exchange that is in shares, which gives higher returns. So as to overcome from this the banks should increase their interest rates.
•
As the deposit mobilization is concerned the Indian bank and IOB has the highest amount of deposit during this year. The rest of other four banks has to make their efforts to mobilize more deposits from the customers.
•
As the staff of the banks play important role in deposit mobilization, they should create good impression by way of prompt services, and proper guidance to the customers.
•
As the Minimum balance requirement for recurring deposit is least in Indian bank, all the other five banks should also have decreased their minimum balance requirement on recurring deposit to encourage middle and lower level people in the society to open this scheme.
•
All banks providing schemes for senior citizen, SBI should try to decrease the minimum Deposit for this scheme to attract more customers and also help the old people.
•
Canara bank and Corporation bank have only offered scheme for children. If all other banks starts similar type of scheme it will encourage youth to deposit money and can use it in future purpose.
5.3 SUMMARY OF CONCLUSIONS
The key success for commercial banks is deposits. Deposits constitute the backbone of the finance company, deposits are accepted for profitable deployment in the company’s business.
However, the major purpose of this study is to know the various schemes offered by banks to mobilize their deposits. Here in this study schemes offered by five nationalized banks were studied, which reveals the following conclusion.
•
The study reveals that the success of any deposit mobilization depend very much upon personalized services of staff of the bank.
•
Savings bank account is for all kinds of people, tailored intentionally by banks to promote saving habits.
•
Current account is for frequent business operations which is opened by traders, businessmen, corporate bodies, for operating account frequently.
•
Fixed deposit account is scheme offered by banks for regular income to people or else gives high returns as well as safety.
• •
Recurring deposit is for those having fixed monthly income. In recurring deposit scheme as for minimum balance requirement is concerned the least minimum balance is offered by Indian bank that is Rs. 5 and highest is in case of SBI that is Rs. 100 and other banks like canara bank is offering Rs. 50, IOB bank is providing Rs. 10 as minimum balance.
•
Canara bank, IOB and SBI are offering deposit scheme for senior citizens and in this scheme minimum balance requirement for opening this account with canara bank is Rs. 1000 and in SBI it is Rs. 10000.
•
It has been found that among five banks Indian bank and IOB are providing highest number of deposit schemes that is 16 schemes. canara is offering 15 deposit schemes, corporation bank is providing 12 schemes and SBI is offering 11 deposit schemes.
BIBLIOGRAPHY
• TEXT BOOKS
1. PRINCIPLES AND PRACICE OF BANK MANAGEMENT By P. SUBBA RAO.
2. THEORY OF BANKING By B.S. RAMAN
• NEWS PAPERS AND MAGAQZINES
TIMES OF INDIA ECONOMIC TIMES
• INTERNET
WEB SITES OF FIVE NATIONALIZED BANKS
