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Transcript of Summer Training Project Yogesh
“PROJECT: -Enhancing the Fixed
Deposit Penetration in Retail
Banking”
Submitted in U.P. Technical University, Lucknow forSubmitted in U.P. Technical University, Lucknow for
Post Graduate Degree Course in Master in Business Administration (MBA)Post Graduate Degree Course in Master in Business Administration (MBA)
Guided by:- Submitted by:-MR.VAIBHAB KUMAR YOGESH KUMAR FOUZDARBRANCH MANAGER ROLL .NO. 080677081 HDFC BANK M.B.A (IIIrd sem) SANJAY PLACE HINDUSTAN INSTITUTE AGRA,(U.P). MANAGEMENT AND COMPUTER STUDIES FARAH ,MATHURA (U.P),
1
CONTENTS
Contents
2
Acknowledgement
4
Preface 5
Declaration
6
Origin of the HDFC bank 7
HDFC Companies Profile 9
Key Business Segment 13
Growth and Development of the Bank 18
Functional Departments of the Bank
23
Market profile of the organization
29
Important events in the history of HDFC Bank 32
Composition of the Board 50
HDFC Bank products at a glance 51
Fixed Deposits 57
Awards and Achievements won by the HDFC Bank 80
2
Comparison between different banks 90
Analysis of survey conducted 98
Suggestions 104
Conclusion 106
Bibliography 108
3
ACKNOWLEDGEMENT
I take great pleasure to thank and acknowledgement the
permission and allowance by Mr. VAIBHAB KUMAR
BRANCH MANAGER, HDFC BANK AGRA REGION and his
help and inspiration provided. I extend a whole hearted thanks
to Mr. VINOD KUMAR under whom I worked and learned a
lot and for enlightening me with their knowledge and
experience to grow with the corporate working.
Their guidance at every stage of the Project enabled me to
successfully complete this project which otherwise would not
have been possible without their constant encouragement and
motivation, without the support it was not possible for me to
complete the report with fullest endeavour.
I would also like to extend my thanks to my College Faculty
Members all my colleagues in the company who supported me
in carry out my operation successfully and generously and
provided me vital information/ training regarding the my
project objective.
YOGESH KUMAR FOUZDAR
M.B.A (IIIrd SEM)
PREFACE
4
I had undergone a practical training under HDFC BANK
AGRA REGION. It was a good exposure for me to undergo
training in such a company to get the knowledge and
experience regarding Marketing and sales.
Summer training is one of the major experiencing component
of the knowledge, gain of relevant of information with respect
to marketing and dealing with situations in a professional
course like M.B.A. where a professional person faces a problem
in a field. I was able to get familiarized with the customer
relationship and got to know how a company measures to
resolve their grievances and service them to the maximum for
future prospect and success. Field component like survey,
generation of questionnaire with respect to marketing helped
me a lot and would be a great support in future.
“It is good to have enthusiasm but it is essential to have
training. Training can be in all way of life.” Thus I would
say that this training was beneficial educative & good exposure
to me, which will certainly help in my near future. This project
was designed with respect to this company.
,
DECLARATION
5
I hereby declare that the project entitled “Enhancing the Fixed
Deposit Penetration in Retail Banking” submitted for the M.B.A.
Degree is my original work and the dissertation has not formed the
basis for the award previously of any degree, associate ship,
fellowship or any other similar titles.
Place: Yogesh Kumar
Fouzdar
Date: (Student’s name)
Origin of the HDFC bank
Housing Development Finance Corporation Limited, more popularly
known as HDFC Bank Ltd, was established in the year 1994, as a part
6
of the liberalization of the Indian Banking Industry by Reserve Bank of
India (RBI). It was one of the first banks to receive an 'in principle'
approval from RBI, for setting up a bank in the private sector. The
bank was incorporated with the name 'HDFC Bank Limited', with its
registered office in Mumbai. The following year, it started its
operations as a Scheduled Commercial Bank.
HDFC Bank Limited. The Group's principal activities are to provide
banking and other financial BANK. The Group operates through four
segments: Treasury, Retail Banking, Wholesale Banking and Other
Banking Business. The Treasury BANK segment consists of net
interest earnings on investments portfolio of the bank and gains or
losses on investment operations. The Retail Banking segment serves
retail customers through a branch network and other delivery
channels. This segment raises deposits from customers and makes
loans and provides advisory BANK to customers. The Wholesale
Banking segment provides loans and transaction BANK to corporate
and institutional customers. The Other Banking Operations segment
provides BANK relating to credit cards, debit cards, third party
product distribution and primary dealership business and other
associated costs. The Bank was Incorporated on 30th August 1994. A new private
sector Bank promoted by housing Development Corporation Ltd. (HDFC), a premier
housing finance company. The bank is the first of its kind to receive an in-principle
approval from the RBI for establishment of a bank in the private sector. Certificate of
7
Commencement of Business wasreceived on 10th October 1994 from RBI. The Bank
transacts both traditional commercial banking as well as investment banking. HDFC, the
promoter of the bank has entered into an
agreement with National Westminister Bank Pc. and its subsidiaries
(Nat west Group) for subscribing 20% of the banks issued capital and
providing technical assistance in relation to the banks proposed
banking business.
HDFC BANK: - COMPANY’S PROFILE
The Housing Development Finance Corporation Limited (HDFC) was
amongst the first to receive an “in principle” approval from the
Reserve Bank of India (RBI) to set up a bank in the private sector, as
part of the RBI's liberalization of the Indian Banking Industry in 1994.
The bank was incorporated in August 1994 in the name of 'HDFC
Bank Limited', with its registered office in Mumbai, India. HDFC Bank
8
commenced operations as a Scheduled Commercial Bank in January
1995.
PROMOTER:-
HDFC is India's premier housing finance company and enjoys an
impeccable track record in India as well as in international markets.
Since its inception in 1977, the Corporation has maintained a
consistent and healthy growth in its operations to remain the market
leader in mortgages. Its outstanding loan portfolio covers well over a
million dwelling units. HDFC has developed significant expertise in
retail mortgage loans to different market segments and also has a
large corporate client base for its housing related credit facilities.
With its experience in the financial markets, a strong market
reputation, large shareholder base and unique consumer franchise,
HDFC was ideally positioned to promote a bank in the Indian
environment.
BUSINESS FOCUS:-
HDFC Bank's mission is to be a World-Class Indian Bank. The
objective is to build sound customer franchises across distinct
businesses so as to be the preferred provider of banking services for
9
target retail and wholesale customer segments, and to achieve
healthy growth in profitability, consistent with the bank's risk
appetite. The bank is committed to maintain the highest level of
ethical standards, professional integrity, corporate governance and
regulatory compliance.
HDFC Bank's business philosophy is based on four-core values: -
Operational Excellence
Customer Focus
Product Leadership
People
Capital Structure:-
At present, HDFC Bank boasts of an authorized capital of Rs 550
crore (Rs5.5 billion), of this the paid-up amount is Rs 424.6 crore
(Rs.4.2 billion). In terms of equity share, the HDFC Group holds
19.4%. Foreign Institutional Investors (FIIs) have around 28% of the
equity and about 17.6% is held by the ADS Depository (in respect of
the bank's American Depository Shares (ADS) Issue). The bank has
about 570,000 shareholders. Its shares find a listing on the Stock
Exchange, Mumbai and National Stock Exchange, while its American
Depository Shares are listed on the New York Stock Exchange
(NYSE), under the symbol 'HDB'
10
DISTRIBUTION NETWORK:-
HDFC Bank is headquartered in Mumbai. The Bank at present has an
enviable network of over 761 branches spread over 327 cities
across India. All branches are linked on an online real-time basis.
Customers in over 120 locations are also serviced through Telephone
Banking. The Bank's expansion plans take into account the need to
have a presence in all major industrial and commercial centers where
its corporate customers are located as well as the need to build a
strong retail customer base for both deposits and loan products. Being
a clearing/settlement bank to various leading stock exchanges, the
Bank has branches in the centers where the NSE/BSE has a strong
and active base member.
The Bank also has a network of about over 1977 networked ATMs
across these cities. Moreover, all domestic and international
Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American
Express Credit/Charge cardholders can access HDFC BANK’s ATM
network.
11
MANAGEMENT:-
Mr. Jagdish Kapoor took over as the bank's Chairman in July 2001.
Prior to this, Mr. Kapoor was a Deputy Governor of the Reserve Bank
of India.
The Managing Director, Mr. Aditya Puri, has been a professional
banker for over 25 years and before joining HDFC Bank in 1994 was
heading Citibank’s operations in Malaysia.
The Bank's Board of Directors is composed of eminent individuals
with a wealth of experience in public policy, administration, industry
and commercial banking. Senior executives representing HDFC are
also on the Board.
Senior banking professionals with substantial experience in India and
abroad head various businesses and functions and report to the
Managing Director. Given the professional expertise of the
management team and the overall focus on recruiting and retaining
the best talent in the industry, the bank believes that its people are a
significant competitive strength.
12
KEY BUSINESS SEGMENTS
HDFC Bank offers a wide range of commercial and transactional
banking services and treasury products to wholesale and retail
customers. The bank has three key business segments:
1. WHOLESALE BANKING SERVICES
The Bank's target market ranges from large, blue-chip
manufacturing companies in the Indian corporate to small & mid-
sized corporate and agri-based businesses. For these customers,
the Bank provides a wide range of commercial and transactional
banking services, including working capital finance, trade services,
transactional services, cash management, etc. The bank is also a
leading provider of structured solutions, which combine cash
management services with vendor and distributor finance for
facilitating superior supply chain management for its corporate
customers. Based on its superior product delivery / service levels
and strong customer orientation, the Bank has made significant
inroads into the banking consortia of a number of leading Indian
corporates including multinationals, companies from the domestic
business houses and prime public sector companies. It is
recognized as a leading provider of cash management and
13
transactional banking solutions to corporate customers, mutual
funds, stock exchange members and banks.
2. RETAIL BANKING SERVICES
The objective of the Retail Bank is to provide its target market
customers a full range of financial products and banking services,
giving the customer a one-stop window for all his/her banking
requirements. The products are backed by world-class service and
delivered to the customers through the growing branch network,
as well as through alternative delivery channels like ATMs, Phone
Banking, Net Banking and Mobile Banking. The HDFC Bank
Preferred program for high net worth individuals, the HDFC Bank
Plus and the Investment Advisory Services programs have been
designed keeping in mind needs of customers who seek distinct
financial solutions, information and advice on various investment
avenues. The Bank also has a wide array of retail loan products
including Auto Loans, Loans against marketable securities,
Personal Loans and Loans for Two-wheelers. It is also a leading
provider of Depository Participant (DP) services for retail
customers, providing customers the facility to hold their
investments in electronic form. HDFC Bank was the first bank in
India to launch an International Debit Card in association with
14
VISA (VISA Electron) and issues the Master Card Maestro debit
card as well. The Bank launched its credit card business in late
2001. By September 30, 2005, the bank had a total card base
(debit and credit cards) of 5.2 million cards. The Bank is also one of
the leading players in the "merchant acquiring" business with over
50,000 Point-of-sale (POS) terminals for debit / credit cards
acceptance at merchant establishments.
3. TREASURY
Within this business, the bank has three main product areas -
Foreign Exchange and Derivatives, Local Currency Money Market
& Debt Securities, and Equities. With the liberalization of the
financial markets in India, corporate need more sophisticated risk
management information, advice and product structures. These
and fine pricing on various treasury products are provided through
the bank's Treasury team. To comply with statutory reserve
requirements, the bank is required to hold 25% of its deposits in
government securities. The Treasury business is responsible for
managing the returns and market risk on this investment portfolio.
15
RATINGS GIVEN TO HDFC BANK:-
Credit Rating
The Bank has its deposit programs rated by two rating agencies -
Credit Analysis & Research Limited (CARE) and Fitch Ratings India
Private Limited. The Bank's Fixed Deposit programme has been rated
'CARE AAA (FD)' [Triple A] by CARE, which represents instruments
considered to be "of the best quality, carrying negligible investment
risk". CARE has also rated the bank's Certificate of Deposit (CD)
programme "PR 1+" which represents "superior capacity for
repayment of short term promissory obligations". Fitch Ratings India
Pvt. Ltd. (100% subsidiary of Fitch Inc.) has assigned the "tAAA (ind )"
rating to the Bank's deposit programme, with the outlook on the
rating as "stable". This rating indicates "highest credit quality" where
"protection factors are very high".
The Bank also has its long term unsecured, subordinated (Tier II)
Bonds rated by CARE and Fitch Ratings India Private Limited and its
Tier I perpetual Bonds and Upper Tier II Bonds rated by CARE and
CRISIL Ltd. CARE has assigned the rating of "CARE AAA" for the
subordinated Tier II Bonds while Fitch Ratings India Pvt. Ltd. has
assigned the rating "AAA (ind)" with the outlook on the rating as
16
"stable". CARE has also assigned "CARE AAA [Triple A]" for the Banks
Perpetual bond and Upper Tier II bond issues. CRISIL has assigned
the rating "AAA / Stable" for the Bank's Perpetual Debt programme
and Upper Tier II Bond issue. In each of the cases referred to above,
the ratings awarded were the highest assigned by the rating agency
for those instruments.
Corporate Governance Rating
The bank was one of the first four companies, which subjected itself to
a Corporate Governance and Value Creation (GVC) rating by the
rating agency, The Credit Rating Information Services of India
Limited (CRISIL). The rating provides an independent assessment of
an entity's current performance and an expectation on its "balanced
value creation and corporate governance practices" in future. The
bank has been assigned a 'CRISIL GVC Level 1' rating which indicates
that the bank's capability with respect to wealth creation for all its
stakeholders while adopting sound corporate governance practices is
the highest.
Growth and Development of the Organization
17
1994.
On 16.1.1995, 90,79,930 No. of equity shares were allotted to
Jarrington Pte. Ltd. Another 400,00,000 equity shares were allotted
on private placement basis to Natwest Group on 9.5.1995.
500,00,000 shares were allotted to the public on 9.5.95 The Bank
opened its first branch in Ramon House at Churchgate, Mumbai on
January 16th.
The Bank has created an efficient operating system using well tested
state-of-the-art software.
1995
70 No. of equity shares issued to subscribers to the Memorandum
&Articles of Association on 30th August 1994. On the same date
500,00,000 equity shares were allotted to HDFC promoters.
509,20,000 shares were allotted to HDFC Employees Welfare Trust
and HDFC Bank Employees Welfare Trust on 22nd December,
1996
HDFC Bank has entered the banking consortia of over 50 corporates,
including some leading multinational companies, flagship companies
of local business houses and strong public sector companies.
HDFC Bank has set up a state-of-the-art dealing room to handle all
transactions possible in Indian financial markets.
18
The Certificates of Deposits were awarded a PP1+ rating which is the
highest rating for short term instruments indicating superior capacity
for repayment.
2001
- The Bank has opened its first branch in Aurangabad. HDFC
Standard Life Insurance has entered into a memorandum of
understanding with the Chennai-based Indian Bank. The Bank has
launched the international Maestro debit card inassociation with
Master Card. HDFC Bank will launch its credit card in June through
link-ups with MasterCard and Visa.LTtrade.com has entered into a
strategic tie-up with HDFC Bank to provide Net banking BANK to
online investors. Standard Chartered Bank, HDFC Bank and Bharat
Petroleum Corporation have joined the eCash Forum which has been
set up by the Smart Card Forum of India. HDFC Bank has launched a
new campaign for its eage savings account. HDFC Bank entered into a
strategic tie-up with Tally Solutions Pvt. Ltd. to offer online real time
accounting BANK to small and Medium enterprises.The Bank has
opened four ATMs outlets in Bangalore at Coles Road, RT Nagar,
Rajaji Nagar and Jaya Nagar on March 26. HDFC Standard Life
Insurance has launched a `Development Insurance Plan' a low cost
19
life insurance product developed specifically to meet the needs of
economically weaker sections. Two Directors, Mr. S.S. Thakur and
Mr. Amit Judge, have resigned from the board of the bank effective
from March 30. HDFC Bank files with US regulators to list more than
11 million American Depositary Shares on the New York Stock
Exchange.
Today HDFC Bank has 1,412 branches and over 3,295 ATMs, in 528
cities in India, and all branches of the bank are linked on an online
real-time basis. [2] As of September 30, 2008 the bank had
total assets of INR 1006.82 billion.[3] For the fiscal year 2008-09, the
bank has reported net profit of Rs.2,244.9 crore, up 41% from the
previous fiscal. Total annual earnings of the bank increased by 58%
reaching at Rs.19,622.8 crore in 2008-09.
Present Status of the Organization:-
March 2007 March 2008 March 2009
Citied 228 316 452
Branches 535 684 1412
ATMs 1323 1605 3275
20
Housing Development Finance Corporation Limited, more popularly
known as HDFC Bank Ltd, was established in the year 1994, as a part
of the liberalization of the Indian Banking Industry by Reserve Bank of
India (RBI). It was one of the first banks to receive an 'in principle'
approval from RBI, for setting up a bank in the private sector. The
bank was incorporated with the name 'HDFC Bank Limited', with its
registered office in Mumbai. The following year, it started its
operations as a Scheduled Commercial Bank. Today, the bank boasts
of as many as 1412 branches and over 3275 ATMs across
India. Amalgamation
In 2002, HDFC Bank witnessed its merger with Times Bank Limited (a
private sector bank promoted by Bennett, Coleman & Co. / Times
Group). With this, HDFC and Times became the first two private
banks in the New Generation Private Sector Banks to have gone
through a merger. In 2008, RBI approved the amalgamation of
Centurion Bank of Punjab with HDFC Bank. With this, the Deposits of
the merged entity became Rs. 1,22,000 crore, while the Advances
were Rs. 89,000 crore and Balance Sheet size was Rs. 1,63,000 crore.
Head Office
HDFC Bank
Ramon House, 169, Backbay Reclamation,
21
H T Parekh Marg, Churchgate
Mumbai - 400020
Phone: +91 (22) 66316000, 66636000, 66316060
Fax: +91 (22) 22048834
Website: www.hdfc.com
Functional Departments of the Bank
The functional departments of the organization consists of the HR
department, the administrative department and the executive
department. The HR department of the organization consists of the
people who employ the Persons who they think would be able to do
justice with the job handled.The administrative department of the
organization consists of the director and the manager of the
organization. They preside the organization and control all the
operations of the organization such that the organization could run in
a smooth and effective manner.The executive department of the
organization consists of the various employees Who execute the job
undertaken by them. The employees consists of the team leaders, the
Corporate financial consultants,. the telecallers, various staffs and
junior staffs who are the main structural framework of the
organization. The organization thus runs with the effective
coordination of the HR department, the administrative department
22
and the executive department such that the supervisors of the
organization preside over the subordinate employees to give them
directions about fulfilling their works most efficiently and effectively.
Technical Consultancy Department: The Technical Consultancy
Department is responsible for technical appraisal of industrial
projects. The mission of the division is aimed towards the verification
of the technical viability of industrial projects and assisting the Funds
management in taking the decisions that require technical expertise.
Moreover, it is responsible for conducting technical studies and
rendering technical consultancy BANK to certain industrial sectors for
the purposes of investigating modern technologies and productivity
levels for local manufacturing plants.
H R Department:
HDFC Human Resources department plans and direct for the
employee population as well as they are having the following
functions as:-
Hiring
Promotions
Reassignments
Position classification and grading
Salary determination
Performance appraisal review and processing
23
Personnel data entry and records maintenance
Policy development
Work permitting immigration visa program
Workers’ compensation
Finance Department:
The Finance Manager is responsible for all aspects of the accounting
and financial administration of the HDFC, the supervision of the
implementation of the HDFC financial policies, directives and
procedures and the initiation of the financial plans within the
guidelines of HDFC The department contains several distinct
sections, each of which is responsible for a proportion of the activities
taking place within the finance department.
Marketing Consultancy Department:
The Marketing Consultancy Department plays and important role
within the Fund as it studies and analyzes marketing information in
order to build solid base for management decisions. The division also
assists projects sponsors in formulating solid marketing strategies to
improve their industries and strengthen their position in the local and
international markets.
24
Research Department:
The Research Department is having the capacity to act through four
composing units i.e., the market research unit, economic studies unit,
and statistical studies unit. It is the mission of the division to provide
support BANK for information and consultancy to the senior
management and division in the areas of economic, statistical and
marketing information and consultancy through data analysis,
processing of economic and statistical data, market research studies
and publishing related periodical reports.
Organization Structure and Organization Chart
The organization structure of the company HDFC is such that it
comprises of the departments and the employees in the hierarchical
order so that they are able to perform their functions and duties
smoothly and effectively doing their job in a manner in which it should
be done. The organization is headed by the administrative department
which coordinates and controls the executive department. The
executive department is a link from the top and the bottom
comprising of the lower level employees such that they work together
to fulfill the common objective of getting business from the persons
who get in touch with them and see to it that they are provided with
the best of the BANK which constitute giving financial advise to
25
providing Account to the customers. The lower level employees and
the corporate financial consultants work together to see to it that the
database for providing financial BANK to sufficient number of people
is made .They work together to see to it that this database is followed
and worked upon such that more and more number of people get
themselves avail the financial BANK of the organization. Team leaders
who form the part of the administrative department of the
Organization make sure that the clients that turn up for the financial
BANK are dealt with most efficiently and effectively.
The organizational structure is well planned out and it follows a
simple format which is follows:
26
Organization Chart:-
Each team lead has a team comprising only of both senior as well as
junior market research analyst who aid the team lead in the entire
market research process as it has been discussed previously. This is
the basic organizational structure followed by HDFC BANK.
27
Market profile of the organization
HDFC Bank Limited provides various financial products and services.
It operates in three segments: Retail Banking, Wholesale Banking,
and Treasury. The Retail Banking segment provides various deposit
products, including savings accounts, current accounts, fixed
deposits, and demat accounts. It also offers auto, personal,
commercial vehicle, home, gold, and educational loans; loans against
securities, property, and rental receivables; and health care finance
working capital finance, construction equipment finance, and
warehouse receipt loans, as well as credit cards, debit cards,
depository, investment advisory, bill payments, and transactional
services. In addition, this segment sells third party financial products,
such as mutual funds and insurance, as well as distributes life and
general insurance products through its tie-ups with insurance
companies and mutual fund houses. The wholesale banking segment
provides loans, non-fund facilities, and transaction services to large
corporate, emerging corporate, small and medium enterprise, supply
chain, public sector undertaking, central and state government
departments, and institutional customers. It offers deposit and
transaction banking products, supply chain financing, working capital
and term finance, agricultural loans, and funded, non-funded treasury,
28
and foreign exchange products. These segments services include
trade services, cash management, money market, custodial, tax
collection, and electronic banking. In addition, it provides
correspondent bank services to co-operative banks, private banks,
foreign banks, and regional rural banks; and wealth management
products for non-resident Indians. The Treasury Services segment
operates primarily in areas, such as foreign exchange, money market,
interest rate trading, and equities. As of March 31, 2009, HDFC Bank
had a network of 1,412 branches and 3,295 automated teller
machines in 528 cities in India. The company was founded in 1994
and is based in Mumbai, India.
In today’s growing world everyone needs to diversify their business so
as to keep in touch with the rapid development. By analyzing the
growing concerns of the market, HDFC has clients varying from
investment banking sector, retail, web designing companies, etc. Due
to this rapid development HDFC Group has many teams working for
the above mentioned sectors.
HDFC Bank began operations in 1995 with a simple mission: to be a
"World-class Indian Bank". We realised that only a single-minded
focus on product quality and service excellence would help us get
there. Today, we are proud to say that we are well on our way towards
that goal.
29
The products and BANK of our competitors are as
follows:-
A. Customer Satisfaction Analysis:
Customer analysis involves gathering data about the customers and
their characteristics. They also conduct tailored customer satisfaction
surveys to gauze customer satisfaction.
B. Risk
These BANK are used by the competitors in order to gather external
information and research the possible effect on the competitiveness of
company.
C. Product Research BANK:
The conduction of extensive product research by this service helps the
competitors to find out the marketability of a product or service. The
research can be utilized to leverage the major decisions of a company
on the marketing of its products.
D. Advertising Research BANK:
30
Advertising research strives to gain valuable information about the
effects and reach of advertising the products in different forms of
media.
IMPORTANT EVENTS IN THE HISTORY OF HDFC
BANK
1994
The bank was incorporated on 30th august. A new private
sector bank promoted by housing development corporation
Ltd. (HDFC), a premier housing finance company. The bank
is the first of its kind to receive an in-principle approval from
the RBI for establishment of a bank in the private sector.
Certificate of commencement of business was received on
10th October 1994 from RBI.
The bank transacted in both traditional commercial banking
as well as investment banking. HDFC, the promoter of the
bank has entered into an agreement with National
Westminster Bank ac. And its subsidiaries (Natwest Group)
for subscribing 20% of the banks issued capital and providing
technical assistance in relation to the banks proposed
banking business.
31
1995
70 number of equity shares issued to subscribers to the
memorandum & articles of association on 30th August 1994.
On the same date 50000000 equity shares were allotted to
HDFC promoters. 50920000 shares were allotted HDFC
Employees Welfare Trust and HDFC Bank Employees Welfare
Trust on 22nd December 1994.
On 16.1.1995, 9079930 no. Of equity shares were allotted to
Jerrington Pte. Ltd. Another 40000000 equity shares were
allotted on private placement basis to Natwest Group on
9.5.1995. 50000000 shares were allotted to the public on
9.5.1995(all were taken up).
The bank opened its first branch in Ramon House at Church
gate, Mumbai on january16th.
The bank had created an efficient operating system using
well-tested state of the art software.
1996
HDFC Bank had entered the banking consortia of over 50
corporate, including some leading multinational companies,
flagship companies of local business houses and strong
public sector companies.
32
HDFC Bank had set up a state of the art dealing room to
handle all transactions possible in Indian financial markets.
The Certificate of Deposits was awarded a PP1+ rating which
in the highest rating for short term instruments indicating
superior capacity for repayment.
1997
The bank is one of the largest which mobilizes of retail
deposits through its network of 20 branches.
The bank had set up an ultra modern hub at Powai in
Mumbai where the bank’s central computer is housed. This
hub housed in 35000 square feet, houses data of all the
branches and facilitates inter connectivity between branches
and link up with on line system.
HDFC Bank had also signed up as a depository participant
under the newly set up NSDL, wherein the members clearing
account settlement for dematerialized shares can be done
through the bank.
The bank proposed to launch tele-banking for the first time in
June in Mumbai at its Chandiveli branch.
The bank had become the first private sector to conclude as
structured interest rate option deal.
33
The bank had launched in Versova branch, the 11th branch in
Mumbai.
The bank, as part of its expansion plans in the south, had
opened another branch in Chennai.
The bank had entered into strategic alliance with 10 overseas
banks to provide customers with a wide range of derivatives
including interest rate and foreign currency swaps.
The bank, on October 14th introduced ATMs that converse in
a regional language.
The bank had launched an account in all its 28 branches
across India that seeks to free depositors from minimum
balance requirement, for the first time in the country.
The bank had introduced a new loan product for the payment
of betterment fees announced by the Bangalore Mahanagar
Palika.
The bank was all set to launch its debit card by April 1998.
1998
The bank tied up with the Ahmedabad Stock Exchange to act
as its clearing bank.
34
The bank proposed to strengthen its branch network in
Calcutta with the addition of two new branches in the first
quarter of the next fiscal.
The bank signed an agreement with the National Stock
Exchange, which gave it a second charge over the brokers
deposit for providing loan against share facility to NSE
brokers.
The bank had also entered into a similar understanding with
the Bombay Stock Exchange whereby the house will provide
support for recovery of money against the card for loan
against share facility.
The bank had also entered into “Cirrus” arrangements by
which all Master card holders across the globe will be able to
transact at HDFC Bank.
The bank also started with providing phone- banking facility
in Bangalore.
The bank tied up with Visa International to offer its debit
card.
The bank had entered into a Memorandum of Understanding
for strategic business collaboration with Chase Manhattan
bank.
1999
35
The bank became the first bank in India to link up its
automated teller machine (ATM) network with the entire
major payment systems worldwide.
The bank was the first bank in the Asia-pacific region to
connect the American Express Payment System.
The bank expanded its ATM services to connect to American
Express Interchange based in Phoenix, Arizona, USA.
The bank was the first to sign up with AMEX in December
1998.
Sony India ltd. Heads joined hands with HDFC Bank to work
out an innovative car finance package under which a Sony
car audio system would be installed to a new car for no
additional upfront cash flow.
The bank had decided to issue 13310000 equity shares of Rs.
10 each to HDFC Bank and a wholly owned subsidiary of it at
a price of Rs. 94 per share.
The bank had tied up with BPL ltd. To offer Internet enabled
supply chain management and business-to- consumer e-
commerce services to corporates.
Hutchinson Max Telecom and HDFC Bank had introduced the
country’s’ first ever mobile banking services in the city.
2000
36
HDFC Bank also signed a Memorandum of Understanding
with Singapore Telecom’s e-commerce arm Sesami.com Pvt
Ltd.
The Bank later also entered into a partnership agreement
with National Computer Systems, the e-commerce unit of
Singtel.
A new company called Sesami.com (India) has been formed
by a strategic alliance between HDFC Bank and Singapore
Telecom e-commerce company Sesami.com,to offer e-
commerce solutions for the Indian market.
HDFC Bank had a tied up with Maxtouch for giving the
facility to the later customers in Mumbai. This is the first and
only service of this sort in the country, he said.
HDFC Bank also launched an online electronic banking
solution called Enet which will allow corporate to access
their accounts over the net and carry out trade related
transactions and cash management functions.
HDFC Bank entered into a tie up with Telco by which the
bank would provide preferential financing options for Tata’s
range of passenger cars including the Indica, Sumo, Safari,
Estate and Sierra.
37
HDFC Bank allotted 1.98crore shares of Rs.10 each at an
issue price of Rs.94 per share to promoters and strategic
investors on March 29.
HDFC Bank is also set to become the first bank in the
country to offer wireless application protocol (WAP) services
to customers.
Sky Cell Communications Ltd, one of the two cellular service
providers in Chennai, had launched ‘Sky Banking’, for which
the company had tied up with ICICI Bank and HDFC Bank.
The bank had tied up with financial portals, e-brokerages and
the National Stock Exchange to enable broker payments for
e-broking ventures.
The bank had set up 100 new Electronic Data Capture (EDC)
terminals in Mumbai.
The bank had launched its first B2C payment gateway which
allows Visa and Mastercard credit card holders to do
transaction online real time.
CYBERITMALL.COM had joined hands with the bank to
provide Visa/Mastercard users with an online payment
gateway solution to enable them to have a secure e-shopping
experience.
38
The bank plans to extend its mobile phone banking services
introduced in select metros to mobilephone broking when it
introduces its internet on-line trading in July.
The bank and portal clickforsteel.com have signed a
Memorandum of Understanding for offering online credit and
services to facilitate “post-transaction” activities through the
portal’s “allied services providers” programme.
Indianinfoline.com signed an agreement with the bank for
the use of payment gateway to enable online financial
transactions.
The bank, in association with the cellular services provider
“Orange”, had launched the entire range of mobile banking
services and mobile commerce services using Wireless
Application Protocol (WAP) technology.
The bank had introduced a new scheme whereby it would
provide loans to individuals for payment self-assessment tax
on their properties in Bangalore.
The foreign investment promotion board had cleared the
proposal of the HDFC Group to enter into a joint venture with
Singapore telecom’s e-commerce company for providing a
comprehensive range of B2B e-commerce solutions to
companies in India.
39
The bank proposed to pick up an equity stake in Softcell
trade and technologies ltd., a Mumbai based Software
Company.
BPL mobile had tied up with HDFC Bank to offer Internet
banking through the mobile phone.
The bank launched “e-instant car loans” a new scheme for
offering customers a range of net-enabled loan products.
The bank launched depository services on the net.
The bank tied up with NSE.IT, a wholly owned subsidiary of
the NSE, for providing payment gateway services for the
latter’s Internet trading operations.
The bank had been identified as the best domestic
commercial bank for the second consecutive year by
financeasia.com, which provides a network for financial
decision makers.
The Mumbai-based Geojit Securities ltd., had tied up with the
bank for internet trading of shares.
Calcutta’s cellular services provider Modi Telstra, and the
HDFC Bank had entered into a collaboration to provide
mobile commerce in Calcutta.
The bank had got the kerala based Nedungadi bank as its
first customer for its new joint venture company with the I-
flex solutions.
40
The bank had had set a target of attaining a business of over
Rs 15000 crore this fiscal mainly through expansion and new
product launches, including a credit card.
The bank, in association with Tata Cellular, had launched
mobile commerce service, for customers in Hyderabad and
Vishakhapatnam.
The bank had tied up with about 25 equity brokerages for
enabling third party transfer of funds and securities through
its B2B portal-“e-net”.
The bank had entered into an alliance with with Deloitte
Haskins and Sells, a member firm of Deloitte and Touch, to
offer banking services to its non-resident Indian customers.
The bank had launched its 123rd outlet at DSE building at
Asaf Ali road, Delhi.
The bank had tied up with with Rajan Raheja owned Hathway
for providing banking at home as part of net-over-cable
initiative of the later in Mumbai.
The bank had launched its on-line bill payment facility in
alliance with the Maharashtra state electricity board has also
begun to offer bridge loans against fixed deposits of parent
HDFC Corporation the financial institution.
The bank had tied up with portal brainvisa.com to retail
education loans to students.
41
The Gujarat cellular operator Fascel, had signed up with the
bank to introduce mobile commerce for the first time in the
state.
The bank had tied up with BPL mobile for mobile commerce
facility.
Cricketnext.com, a sports e-commerce site had tied up with
HDFC Bank to provide an on-line payment gateways and
marketing opportunities for a wide range of cricket sports
gear on its online shop batnext.
Singapore-based Growasia.com had entered into an
understanding with HDFC Bank and credit rating agency
Icra, for picking equity in the company’s Indian subsidiary
Gasia.com.
The HDFC Bank and Cosmos bank launched a co-branded
ATM card.
The bank and Airtel launched their mobile banking service
through WAP in Delhi.
The bank has launched wireless application protocol based
mobile banking in Coimbatore and Trichy.
2001
The Bank had opened its first branch in Aurangabad.
42
HDFC Standard Life Insurance had entered into a
memorandum of understanding with the Chennai based
Indian Bank.
The Bank had launched the international Maestro debit card
in association with Master card.
The Bank launched its credit card in June through link ups
with Master card and Visa.
L Trade.com had entered into a starategic tie up with HDFC
Bank to provide net banking services to online investors.
Standard Chartered Bank, HDFC Bank and Bharat Petroleum
Corporation had joined the e-cash Forum which has been set
up by the Smart Card Forum of India.
HDFC Bank has launched a new campaign for its e-age
savings account.
HDFC Bank entered into a strategic tie up with Tally
solutions Pvt. Ltd. to offer online real time accounting
services to small and medium enterprises.
The Bank had opened four ATM outlets in Banglore at Coles
Road, RT Nagar , Rajaji Nagar and Jaya Nagar on March 26.
HDFC Standard Life Insurance had launched a ‘Development
Insurance Plan’ a low cost life insurance product developed
specifically to meet the needs of economically weaker
sections.
43
Two directors, Mr. S.S. Thakur and Mr Amit Judge, had
resigned from the board of the bank effective from March
30th.
The bank files with US regulators to list more than 11 million
American depository shares of the NYSE.
2002
The bank unveiled a new online account aggregation service
“Oneview”.
The bank launched “Oneview” service to customers.
The bank launched its 9th branch in Karnataka.
The bank opened its branch in Mangalore.
The bank unveiled silver card in Hyderabad.
The bank opens first overseas representative office.
Mediclaim facilities to HDFC Bank gold cardholders.
The bank launched new products to its wealth management
programme to increase its customer base. The bank introduced
a non-interactive product, “Financial Planner”, which is
available for all its customers for an annual fee starting from Rs
10000.The bank offered fee based advisory programme to the
mass effluent segment, which was easier offered to high net
worth customers. The wealth management programme catered
to the individual needs taking into account various factors such
44
as customer’s age, financial goals and risk profile, which
includes equity, MFs and debt instruments such as RBI relief
bonds.
Orange JV with the HDFC Bank.
2003
The bank unveiled resident foreign currency account.
The bank unveiled co-branded credit card with e-seva.
EPFO JV with the bank for IRS pension distribution.
The bank enters into agreement with HDFC to source
housing loans.
HDFC Bank, IRCTC in tie up for online railway booking.
The bank inked pact with ANB for remittance services.
The bank introduced “HDFC Bank Health Plus Credit Card”.
Escotel tied up with HDFC Bank for global debit card.
The bank launched India’s first mobile payment solution.
The bank’s debt programme of Rs 400 crore had received
triple A (ind) rating from CREDIT rating agency FITCH.
HDFC Bank began selling home loans of its promoter HDFC
Corporation.
Board approval to allot 416400 equity shares to the
employees of the bank under the Employee Stock Option
Scheme.
45
2004
NMCE inked pact with HDFC Bank for warehouse receipts.
The bank has entered into an alliance with Clearing
Corporation of India ltd.(CCIL).
The bank repurchases HDFC loans worth Rs 208 crore.
Launched Quickremit, a unique online service that enables
NRIs in the US to send money to their relatives in India from
the comfort of their homes.
Andhra bank had entered into an alliance with HDFC Bank
for sharing its network of ATMs o march 29th
HDFC bank and Bahraini Saudi bank had announced an
alliance to cater to service the needs of the NRIs in Bahrain.
The bank launched a new scheme for Maruti 800 buyers,
providing 85% finance on the on-road price for the car for
seven years.
The bank’s MD Mr. Aditya Puri has been awarded the
management man of the year by the Bombay Management
Association (BMA).
The bank had launched an online bill payment facility for its
customers who are also subscribers to Tata Teleservices.
The bank joined hands with NCR Corporation to offer
managed ATM services.
46
IKF finance ltd. had entered into a joint lending arrangement
with HDFC Bank ltd.
2005
TMB forged alliance with HDFC Bank.
The bank inaugurated its first ATM in a hotel.
The bank tied up with International bank of Qatar to launch
banking services in Qatar.
The bank launched loyalty rewards programme for its debit
and credit cardholders under the name of “Insta Wonderz”.
The bank along with Mastercard International launched
credit card targeted at a small and medium sized enterprise.
The bank unveiled credit card for farmers.
2006
HDFC Bank sets up two more branches in AP.
2007
The bank signed an agreement with Tata Pipes to offer credit
facilities to farmers across the country.
The bank appointed Mr. Pandit Palande as an additional
director of the bank at the board meeting held on April 24th
2007.
47
The bank informed that the board of directors of the bank at
its meeting held on October 12th 2007 had appointed Mr.
Paresh Sukthankar & Mr Harish Engineer as executive
directors on the board of directors of the bank. The above
mentioned persons have been senior employees of the bank
since 1994 and had various positions of responsibility.
COMPOSITION OF THE BOARD
The Companies Act, 1956, the Banking Regulation Act, 1949, governs
the composition of the Board of Directors of the bank and the listing
requirements of the Indian stock exchanges where the securities
issued by the bank are listed. The board has strength of nine directors
as on march 31, 2007. All directors other than Mr. Aditya Puri are
non-executive directors. The bank has four independent directors and
five non-independent directors. The board consists of eminent persons
with considerable professional expertise and experience in banking,
finance, agriculture, small scale industries and other related fields. All
the directors have made necessary disclosures regarding committee
positions occupied by them in other companies.
48
Mr. Jagdish Kapoor, Mr. Aditya Puri, Mr. Keki Mistry, Mrs. Renu
Karnad and Mr Vineet Jain are non-independent directors on the
board.
Mr. Arvind Pande, Mr. Ashim Samanta, Mr. Gautam Divan and Mr. C
M Vasudev are independent directors on the board.
Mr. Keki Mistry and Mrs. Renu Karnad represent HDFC Ltd on the
board of the bank.
The Benett & Coleman group on the board of the bank nominates Mr.
Vineet Jain.
HDFC BANK’S PRODUCTS AT A GLANCE
The various products, which are provided by HDFC BANK to be
availed by its customers, are summarized as:-
ACCOUNTS AND DEPOSITS
Regular Savings Account
Savings Plus Account
Savings Max Account
49
No Frills Account
Institutional Savings Account
Salary Accounts
- Payroll Account
- Classic Account
- Regular Account
- Premium Account
- Defence Account
Kid's Advantage Account
Pension Saving Bank Account
Family Savings Group
Kisan No Frills Savings
Kisan Club Savings
Current Accounts
- Plus Current Account
- Trade Current Account
- Premium Current Account
- Regular Current Account
- Reimbursement Current Account
- RFC - Domestic Account
- Flexi Current Account
Fixed Deposits
- Regular Fixed Deposit
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- 5 Year Tax Saving Fixed Deposit
- Super Saver Facility
- Sweep-in Facility
Demat Account
Safe Deposit Lockers
LOANS
Personal Loans
Home Loans
Two Wheeler Loans
New Car Loans
Used Car Loans
Express Loans Plus
Gold Loan
Educational Loan
Loan Against Securities
Loan Against Property
Loans Against Rental Receivables
Health Care Finance
Tractor Loans
Commercial Vehicle Finance
Working Capital Finance
51
Construction Equipment Finance
Warehouse Receipt Loans
INVESTMENTS AND INSURANCE SERVICES
Mutual Funds
Insurance
General & Health Insurance
Bonds
Knowledge Centre
Equities & Derivatives
Mudra Gold Bar
FOREX SERVICES
Products & Services
Trade Services
Forex Services Branch Locator
RBI Guidelines
Forex Limits
52
CARDS
Credit Cards
- Silver Credit Card
- Value Plus Credit Card
- Health Plus Credit Card
- Gold Credit Card
- Titanium Credit Card
- Woman's Gold Credit Card
- Platinum Plus Credit Card
- Visa Signature Credit Card
- World MasterCard Credit Card
- Corporate Credit Card
- Business Credit Card
Debit Cards
- EasyShop International Debit Card
- EasyShop Gold Debit Card
- EasyShop International Business Debit Card
- EasyShop Woman's Advantage Debit Card
- EasyShop NRO Debit Card
- Kisan Card
53
Prepaid Cards
- ForexPlus Card
- GiftPlus Card
- FoodPlus Card
- MoneyPlus Card
PAYMENT SERVICES
- NetSafe
- Merchant Services
- Prepaid Refill
- BillPay
- Visa BillPay
- InstaPay
- DirectPay
- Visa Money Transfer
- e-Monies Electronic Funds Transfer
- Excise & Service Tax Payment
- Online Payment of Direct Tax
- Religious Offerings
- Donate to Charity
54
BANK ACCESS SERVICES
- NetBanking
- OneView
- InstaAlerts
- MobileBanking
- ATM
- PhoneBanking
- Email Statements
Fixed Deposits
HDFC Bank offers four types of Fixed Deposits. They are:
- Regular Fixed Deposit
- 5 Year Tax Saving Fixed Deposit
- Super Saver Facility
- Sweep-in Facility
By Fixed Deposit you can earn a higher income on your surplus funds
by investing those with us. We provide security, trust and competitive
rate of interest.
55
Believe in long-term investments and wish to earn higher
interests on your savings, then it’s the time to invest your money in
our Fixed Deposit and get up to 9.50% on HDFC Bank Fixed Deposit
with an additional 0.50% for Senior Citizens. Flexibility, Security and
High Returns all bundled into one offering
NO PENALTY if you withdraw part of the FD in times of need.
Features & Benefits:-
- Potential to earn compound interest by reinvesting the principal
amount along with the interest earned during the period.
- Add to your Fixed Deposit. (Minimum add-ons of Rs. 5,000/-)
when you have surplus funds.
- No penalty for premature withdrawal.
56
- Flexibility in altering period of deposit, maturity and payment
instructions, principal amount and rollover mode before
maturity of the rollover deposit.
- Higher rate of interest on Fixed Deposits for Senior Citizens.
Interest Rates
When you open a fixed deposit with HDFC Bank
Your interest is calculated on a quarterly basis for deposits of 6
months and above
For those deposits with tenure of below 6 months, your interest
is calculated at maturity as Simple Interest. The period of Fixed
Deposit is calculated in number of days.
Interest for re-investment is calculated every quarter, and the
Principal is increased to include interest earned during the
previous quarter.
Tax at source is deducted as per the Income Tax regulations
prevalent from time to time.
Note: Interest rates are subject to change from time to time.
Applicable interest rates will be given as on the date of receipt of
the funds by the bank. When booking FD through Net Banking
please note the actual interest rate being applied on the "Confirm"
57
screen. This screen appears before you confirm your request for
opening a new FD.
In order to see the latest information, we request you to clear your
browsers cache to see the updated interest rates.
DOMESTIC TERM DEPOSITS
Period Amount
Interest
Rate (per
annum)
**Senior
Citizen Rates
(per annum)
Effective
From
7 - 14 daysBelow Rs.15
Lacs3.00% 3.50%
August 6,
2007
15 - 29 daysBelow Rs.15
Lacs5.50% 6.00%
August 6,
2007
30 - 45 daysBelow Rs.15
Lacs6.00% 6.50% July 3, 2008
46 - 60 daysBelow Rs.15
Lacs6.00% 6.50% July 3, 2008
61 - 90 daysBelow Rs.15
Lacs6.25% 6.75% July 3, 2008
91 - 99 days Below Rs.15 7.00% 7.50% July 3, 2008
58
Lacs
100 - 101
days
Below Rs.15
Lacs7.75% 8.25% July 3, 2008
102 - 180
days
Below Rs.15
Lacs7.00% 7.50% July 3, 2008
6 months 1
day - 6
months 14
days
Below Rs.15
Lacs8.00% 8.50% July 3, 2008
6 months 15
days - 6
months 16
days
Below Rs.15
Lacs8.25% 8.75% July 3, 2008
6 months 17
days - 9
months 14
days
Below Rs.15
Lacs8.00% 8.50% July 3, 2008
9 months 15
days - 9
months 16
Below Rs.15
Lacs
9.00% 9.50% July 3, 2008
59
days
9 months 17
days - 1 year
Below Rs.15
Lacs8.75% 9.25% July 3, 2008
1 year 1 day
- 1 year 14
days
Below Rs.15
Lacs8.75% 9.25% July 3, 2008
1 year 15
days - 1 year
16 days
Below Rs.15
Lacs9.50% 10.00% July 3, 2008
1 year 17
days - 2
years
Below Rs.15
Lacs8.75% 9.25% July 3, 2008
2 years 1
day - 2 years
14 days
Below Rs.15
Lacs9.00% 9.50% July 3, 2008
2 years 15
days - 2
years 16
days
Below Rs.15
Lacs9.50% 10.00% July 3, 2008
2 years 17 Below Rs.15 9.00% 9.50% July 3, 2008
60
days - 3
yearsLacs
3 years 1
day - 5 years
Below Rs.15
Lacs9.00% 9.50% July 3, 2008
5 years 1
day - 8 years
Below Rs.15
Lacs9.00% 9.50% July 3, 2008
Interest rates are subject to change from time to time. The bank
will give applicable interest rates as on the date of receipt of the
funds. When booking FD through NetBanking please note the
actual interest rate being applied on the "Confirm" screen. This
screen appears before you confirm your request for opening a
new FD.
** Only Senior Citizens / Retired Personnel (60 years and above)
who are Resident Indians are eligible. The special rates are
applicable only for INR deposits.
*** The FD rate applicable for a monthly interest option will be a
discounted rate over the standard FD Rate. Please contact the
nearest Branch for further information.
****For interest rates on Fixed Deposits for Rs. 15 Lacs and
above, please contact your nearest HDFC Bank branch.
61
Effective 01st Dec'06, the interest rate applicable for premature
closure of deposits will be lower of :
the original rate at which the deposit has been booked OR
The base rate applicable for the tenure for which the
deposit has been in force with the Bank.
The base rate is the rate applicable to deposits of less than Rs.15
lacs.
Eligibility
The following can apply for a Regular Fixed Deposit
Resident Individuals
Hindu Undivided Families
Sole Proprietorship Firms
Partnership firms
Limited companies
Trust Accounts
An initial deposit of Rs. 10,000/- is required to open a Fixed
Deposit.
Add-ons at a minimum of Rs.5,000/-.
Tax Deductions For Re-investment Fixed Deposits
The following will be applicable for a Regular Fixed Deposit
62
TDS will be deducted when interest payable or reinvested per
customer, per branch, exceeds Rs 10,000 in a financial year.
A consolidated Annual TDS Certificate will be mailed to you
after the end of the financial year, including details of all TDS
deductions during the year.
Applicable TDS rates are:
Resident
Individuals &
HUF
Tax Rate SurchargeEducation
CessTOTAL
Payment upto
10 lacs10% ---- 3% 10.30%
Payment
equal to &
above 10 lacs
10% 10% 3% 11.33%
Corporate
EntityTax Rate Surcharge
Education
CessTOTAL
Payment upto
1 crore20% --- 3% 20.60%
Payment
equal to &
20% 10% 3% 22.66%
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above 1 crore
NRO Tax Rate SurchargeEducation
CessTOTAL
Payment upto
10 lacs30% ---- 3% 30.90%
Payment
equal to &
above 10 lacs
30% 10% 3% 33.99%
Firms Tax Rate SurchargeEducation
CessTOTAL
Payment less
than 1 crore10% ---- 3% 10.30%
Payment
equal to &
above 1 crore
10% 10% 3% 11.33%
Co-operative
Societies &
Tax Rate Surcharge Education
Cess
TOTAL
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Local
Authority10% ---- 3% 10.30%
If you are exempt from paying tax, you need to present Form 15H
when you open a Fixed Deposit and subsequently at the beginning of
the following financial year.
At the end of the financial year, the TDS will be deducted on the basis
of interest accrued on the Fixed Deposit (s) even if this interest has
not been credited.
In 2006, it was announced for the first time that Bank fixed deposits
booked by an Individual/HUF for 5 years & upto Rs. 1,00,000/- will be
65
allowed exemption under Sec 80C of the Income Tax Act,1961 subject
to necessary declarations taken from the Customer.
Features & Benefits
Minimum Amount: Rs.100/-
Multiples of Rs.100/-
Maximum Amount: Rs. 1 lac (in a FY)
Tenure - 5 years (lock in period).
Rate of Interest - 8.50% p.a, Senior Citizen rate - 9.00%
No Partial/Premature withdrawal allowed.
Sweep-in not allowed.
No OD or pledge allowed.
In the case of joint holder deposit, the deduction from income
under section 80C of the Act shall be available only to the first
holder of the deposit.
Note: Interest rates are subject to change from time to time.
Applicable interest rates will be announced as on the date of receipt
of the funds by the bank.
Eligibility
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The following can apply for a 5 Year Tax Saving Fixed Deposit
Resident Individuals
Hindu Undivided Families
An initial deposit of Rs. 100/- is required to open a Tax Saving Fixed
Deposit.
Interest Rates
When you open a Fixed deposit with HDFC Bank
Your interest is calculated on a quarterly basis
Interest for re-investment is calculated every quarter, and the
Principal is increased to include interest earned during the
previous quarter.
Tax at source is deducted as per the Income Tax regulations
prevalent from time to time.
Interest rate - 8.50% p.a., Senior Citizen rate - 9.00%**
Note: Interest rates are subject to change from time to time.
Applicable interest rates will be announced as on the date of receipt
of the funds by the bank.
67
** Only Senior Citizens / Retired Personnel (60 years and above) who
are Resident Indians are eligible.
***The FD rate applicable for a monthly interest option will be a
discounted rate over the standard FD Rate. Please contact the nearest
Branch for further information.
Tax Deductions for Re-investment Fixed Deposits
The following will be applicable for a 5 Year Tax Saving Fixed Deposit
TDS will be deducted when interest payable or reinvested per
customer, per branch, exceeds Rs 10,000 in a financial year.
A consolidated Annual TDS Certificate will be mailed to you
after the end of the financial year, including details of all TDS
deductions during the year.
Applicable TDS rates are:
Resident
Individuals &
HUF
Tax Rate SurchargeEducation
CessTOTAL
Payment upto 10% ---- 3% 10.30%
68
10 lacs
Payment
equal to &
above 10 lacs
10% 10% 3% 11.33%
If you are exempt from paying tax, you need to present Form 15H
when you open a Fixed Deposit and subsequently at the beginning of
the following financial year.
At the end of the financial year, the TDS will be deducted on the basis
of interest accrued on the Fixed Deposit (s) even if this interest has
not been credited.
Enjoy a high rate of interest along with the liquidity of a Savings
Account by opting for a SuperSaver Facility on your savings account.
Avail of an overdraft facility of up to 75% of the value of your Fixed
Deposit.
69
Features & Benefits
It's like two Accounts working in tandem to give you better
returns.
Choose between a Saving Account or Current Account to link to
your Fixed Deposit.
Avail an overdraft facility to supplement your household or
business needs.
Pay back with interest only on the drawn amount, while the
remaining Fixed Deposit continues to earn you interest.
Flexibility in altering period of deposit, maturity and payment
instructions, principal amount and rollover mode.
Senior citizens enjoy a higher rate of interest on their Fixed
Deposits. Eligibility
The following are eligible to open a Super Saver Account
Resident Individual (sole or joint account)
Hindu Undivided Family
70
A minimum amount of Rs 25,000/- for a minimum tenure of 6
months is required to open a Super Saver Account, in addition
to a Zero Balance Savings Account.
Only Senior Citizens / Retired Personnel (above 60 years of age)
who are Resident Indians are eligible for the Senior Citizen rate
on the INR fixed deposit.
Note: Minors, Trusts, Associations, Clubs, and Societies, Firms,
Companies, NRIs, and Foreign Nationals cannot avail this facility.
As per the Finance Bill, 2006, all fees & charges mentioned in the
Tariffs, Charges or Fees Brochures will attract Service Tax @12% &
Education Cess @3% of the service tax amount effective 11th May,
2007. The same will appear as separate debits in the statements.
Interest Rates
Earn the interest of a Fixed Deposit, which varies according to the
tenure of your deposit.
For the amount withdrawn, the applicable rate is only 2% above the
fixed deposit rate for the period that the money is used.
If your Savings Account has a credit balance, you will also earn 3.50
% paid into your account quarterly, on the funds existing in your
Savings Account.
71
In effect, the Super Saver Account ensures that you earn a higher
interest rate than you would with a Regular Saving Account.
Do you wish to avoid taking overdrafts, and still take advantage of
your Fixed Deposit? Then what you need is a Sweep-In Facility on
your savings account.
Link your Fixed Deposit to your Savings or Current Account and use it
to fall back on in case of emergencies. A deficit in your Savings or
Current Account is taken care of by using up an exact value from your
Fixed Deposit. Since deposits are broken down in units of Re 1/-, you
will lose interest only for the actual amount that has been withdrawn.
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Features & Benefits
Choose between a Savings Account and Current Account to link
to your Fixed Deposit.
Earn higher interest on the money till it is swept-in, while the
remaining Fixed Deposit continues to earn you interest.
Only an exact amount required to make up for the deficit in the
Savings account is withdrawn from your Fixed Deposit (units of
Re. 1/-) thereby minimizing interest loss.
Multiple deposits can be linked to the Savings account.
Flexibility in altering the period of deposit, maturity and
payment instructions, principal amount and rollover mode.
You can avail of both, a Super Saver Facility as well as a Sweep-
In Facility if you have linked your deposits to a Savings Facility.
Senior citizens enjoy a higher rate of interest on their Fixed
Deposits.
Avail an International Debit Card and a Free cheque book on
your Sweep-in Savings account.
Eligibility & Documentation
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Only Resident Individuals and Hindu United Families are
eligible for a Sweep-In Account
Sweep-In can be also offered on Fixed Deposit linked to a
Current Account.
Fees
Sweep-In with Savings Account
If you maintain a Fixed Deposit of Rs. 50,000/- or more, no service
charges are applicable on the Savings Account. However, if the Fixed
Deposit amount is below Rs. 50,000/-, then the following service
charges will be applicable on the savings account:
The minimum average quarterly balance maintained must be Rs.
5,000/-. If your minimum average quarterly balance is less than Rs.
5,000/- a service charge of Rs 750/- will be levied per quarter.
Sweep-In with Current Account
In case of Current Accounts, the average balance applicable to the
Current Account chosen by you, needs to be maintained irrespective
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of the value of the fixed deposit. Service charges applicable would be
as per the Current Account selected by you.
If the Fixed Deposit is held for less than 15 days, your interest for the
amount transferred is forfeited.
As per the Finance Bill, 2007, all fees & charges mentioned in the
Tariffs, Charges or Fees Brochures will attract Service Tax @12% &
Education Cess @3% of the service tax amount effective 11th May,
2007. The same will appear as separate debits in the statements
AWARDS AND ACHEIVEMENTS WON BY THE HDFC
BANK IN BANKING SERVICES
Finance Asia
Country Awards for
Achievement 2008
'Best Bank and Best Cash Management Bank'
75
CNN-IBN 'Indian of the Year (Business)'
Nasscom IT User
Award 2008
'Best IT Adoption in the Banking Sector'
Business India 'Best Bank 2008'
Forbes Asia Fab 50 companies in Asia Pacific
Asian Banker
Excellence in Retail
Financial Services
Best Retail Bank 2008
Asiamoney Best local Cash Management Bank Award voted by Corporates
Microsoft & Indian
Express Group
Security Strategist Award 2008
World Trade Center
Award of honour
For outstanding contribution to international trade services.
Business Today-
Monitor Group
survey
One of India's "Most Innovative Companies"
Financial Express-
Ernst & Young
Award
Best Bank Award in the Private Sector category
Global HR 'Employer Brand of the Year 2007 -2008' Award - First
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Excellence Awards
- Asia Pacific HRM
Congress:
Runner up, & many more
Business Today 'Best Bank' Award
YEAR 2007
Business
Today-Monitor
Group survey
One of India's "Most Innovative Companies"
Financial
Express-Ernst
& Young Award
Best Bank Award in the Private Sector category
Global HR
Excellence
Awards - Asia
Pacific HRM
Congress:
'Employer Brand of the Year 2007 -2008' Award -
First Runner up, & many more
Business Today 'Best Bank' Award
Dun & 'Corporate Best Bank' Award
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Bradstreet –
American
Express
Corporate Best
Bank Award
2007
The Bombay
Stock
Exchange and
Nasscom
Foundation's
Business for
Social
Responsibility
Awards 2007
'Best Corporate Social Responsibility Practice'
Award
Outlook Money
& NDTV Profit
Best Bank Award in the Private sector category.
The Asian
Banker
Excellence in
Retail Financial
Services
Best Retail Bank in India
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Awards
Asian Banker Our Managing Director Aditya Puri wins the
Leadership Achievement Award for India
YEAR 2006
Business Today Best Bank in India.
Forbes
Magazine
One of Asia Pacific's Best 50 companies.
Business world Best listed Bank of India.
The Asset
Magazine's
Triple A
Country
Awards
Best Domestic Bank.
Asia money
Awards
Best Local Cash Management Bank in Large and
Medium segments.
Euro money
Awards
"Best Bank" in India.
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YEAR 2005
Asia money
Awards
Best Domestic Commercial Bank
Asia money
Awards
Best Cash Management Bank - India.
The Asian
Banker
Excellence
Retail Banking Risk Management Award in India.
Hong Kong-
based Finance
Asia magazine
Best Bank India
Economic
Times Awards
"Company of the Year" Award for Corporate
Excellence.
The Asset
Triple A
Country
Awards
Best Domestic Bank in India Region – 2005
The Business
Today-KPMG
Survey
Best Local Cash Management Bank in India US$11-
100m – 2005
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The Business
Today-KPMG
Survey
"Best Bank in India" for the third consecutive year
in 2005.
Economic
Times - Avaya
Global Connect
Customer
Responsiveness
Awards
"Most Customer Responsive Company - Banking
and Financial Services – 2005
YEAR 2004
Asia money
Awards
Best Local Cash Management Bank in India US$11-
100m
Asia money
Awards
Best Local Cash Management Bank in India
>US$501m
Asia money
Awards
Best Local Cash Management Bank in India 1989-
2004 (poll of polls)
Asia money
Awards
Best Overall Domestic Trade Finance Services in
India - 2004
Asia money Most Improved company for Best Management
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Awards Practices in India – 2004
Business World One of India's Most Respected Companies - 2004
Forbes Global Best Under a Billion, 100 Best Smaller Size
Enterprises in Asia/Pacific and Europe – 2004
Asian Banker
Awards
Operational Excellence in Retail Financial Services -
2004
The Asset
Triple A
Country
Awards
Best Domestic Bank in India – 2004
YEAR 2003
Forbes Global Best Under a Billion, 200 Best Small Companies -
2003
The Asset Triple
A Country
Awards
Best Domestic Bank in India -2003
Business World -
The Business
One of India's Most Respected Companies
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World Most
Respected
Company
Awards
The Asset
magazine
Best Cash Management Bank
The Asset
magazine
Best Trade Finance Bank
FE-Ernst &
Young Best
Banks Survey
Best New Private Sector Bank – 2003
Outlook Money Best Bank in the Private Sector – 2003
Business Today Best Bank in India -2003
NASSCOM &
economictimes.c
om – IT Users
Awards
Best IT User in Banking -2003
There have been some other proud moments for the HDFC Bank as
well. Some of them worth mentioning are: -
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London-based Euro money magazine gave us the award for "Best
Bank - India" in 1999, "Best Domestic Bank" in India in 2000, and
"Best Bank in India" in 2001 and 2002
Asia money magazine has named us "Best Commercial Bank in India
2002".
For our use of information technology we have been recognized as a
"Computerworld Honors Laureate" and awarded the 21st Century
Achievement Award in 2002 for Finance, Insurance & Real Estate
category by Computerworld, Inc., USA.
Our technology initiative has been included as a case study in their
online global archives. The Economic Times has conferred on us The
Economic Times Awards for Corporate Excellence as the Emerging
Company of the Year 2000-01.
Leading Indian business magazine Business India named us "India's
Best Bank" in 2000.
In the year 2000, leading financial magazine Forbes Global named us
in its list of "The 300 Best Small Companies" in the world and as one
of the "20 for 2001" best small companies in the world.
COMPARISION BETWEEN DIFFERENT BANKS
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1. Axis Bank
Axis Bank offered different types of fixed deposits like
Encash 24
Recurring Deposit
Tax Saver Fixed Deposit
Documentation
An Individual, Hindu
Undivided Family, Sole
Proprietorship Concern
A valid passport or a valid driving
license
An introduction by any other bank
or an introduction by an Axis Bank
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Savings Account holder for the last six
months
A photograph
Trusts Copy of the Trust Deed
Copy of the registration certificate
Copy of the Resolution of The
Trustees
Authorizing the members
concerned to open and operate the
account
Photographs of the members
operating the account
Associations / Clubs Bye-laws of the Association
Copy of the Resolution by the board
authorizing the members concerned to
open and operate the account
Photographs of the members
operating the account
Partnership Firm Partnership Deed
Letter from partners approving the
persons concerned to open and operate
the account
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Photographs of the persons
operating the account
Interest rate offered by Axis Bank is also nearly same with interest
rate of HDFC Bank but the services offered by different bank are
different. Like the documentation of HDFC Bank is quite easier or
simpler in comparison to Axis Bank.
2. ICICI Bank
Fixed Deposit
- Wide range of tenures
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- Choice of investment plans
- Partial withdrawal permitted
- Safe custody of fixed deposit receipts
- Auto renewal possible
- Loan facility available
Documentation
Applicants must satisfy the following documentation
requirements:
Identity proof
Proof of communication address
Self cheque (if the applicant is not visiting the branch for
account opening)
Identity Proof
(Any one of the
following)
Proof of
communication
address
(Any one of the
following)
Original letter of
introduction from
Introduction by an
existing and satisfactory
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existing bank along with
KYC cheque of the same
Bank
customer as address
proof
Driving License – Book
type or laminated &
embossed
Latest Electricity Bill
Voter Identity Card with
KYC cheque for
operating accounts.
Cash can be accepted for
Term deposits.
Certificate from the
postal office confirming
address of applicant
Employee Identity Card Original Letter from
Employer certifying the
residential address of
applicant. Signature of
the employee has to be
attested on the letter.
PAN Card Telephone bills from any
telephone service
providers and mobile
service providers (KYC
cheque mandatory for
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mobile service providers)
Defence Dependent's
card
Consumer gas
connection
card/book/Pipe Gas bill
(same as electricity bill)
Ex-Service Man Card Certificate from the
ward/equivalent rank
officer, maintaining
election roll, certifying
address of the applicant
Bar Council/Indian
Medical Association
Card/Senior Citizen Card
Registered and valid
Lease/ Leave agreement
with copies of utility bills
PIO Booklet for
returning NRIs
Post Office Savings Pass
Book with KYC cheque
MAPIN card Statement of account or
Pass Book of a scheduled
commercial bank with
entries of at least last 3
months along with KYC
cheque
Premium Receipt from
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any life insurance
company
Certificate by Village
Extension Officer
(VEO)/Village Head or
equal rank officers
Domicile Certificate with
communication address
and photograph
FDs can be booked through the facility of Phone banking in HDFC
Bank, while in ICICI Bank; this facility is not available and cannot be
availed.
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ANALYSIS OF SURVEY CONDUCTED
1.
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2.
93
3.
4.
94
5.
95
6.
7.
96
8.
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SUGGESTIONS
Some of the suggestions, which came out by doing the above research
and study, for enhancing and improving the value of savings account
in different bank branches are: -
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Fixed Deposits Penetration can be increased by calling our
existing customers and by telling them about the features
offered by the bank in their fixed deposit.
Fixed Deposit Penetration can be increased by making a
proper list of the customers of the bank so, that it can help
us in identifying the people who will invest their money in
fixed deposit.
Arranging a small session once in a month in which the
customers will be called can increase fixed Deposit
Penetration.
All the customers should be given same priority in terms
of providing good quality and satisfaction in terms of
product and services.
Better queuing systems should be designed at the
different bank branches counters so that customers should
not have to wait for too long in queues in the bank
branches.
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In the analysis, it was found that very less people were
aware about the schemes offered by us in the fixed
deposits like NO PREWITHDRAWAL CHARGES, etc. So,
the information regarding the products should be
communicated to people so that the number of ‘prospects’
for the organization may increase. For this, innovative
marketing and communication strategies need to be
implemented.
CONCLUSION
As my project deals with the Fixed Deposits of the banks, an
observation recorded is that people are not very keen on buying FDs
as the interest rates are very low in comparison to products like
mutual funds, shares, etc. and so people think that they are getting
very less returns than expected on their investments.
HDFC Bank’s tagline “WE UNDERSTAND YOUR WORLD” clearly
reflects that the bank understands the needs and demands of its
customers. Different people have different needs and HDFC Bank has
always tried to give best possible products and services to the people.
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That is why; there are so many versatile products and services under
different categories, which the bank avails to its customers.
HDFC Bank have always strived towards excellence and giving top
priority in providing products and services with best features and
benefits for its customers. As the HDFC Bank’s four work culture
philosophies (i.e. operational excellence, customer focus, product
leadership and people), clearly shows the bank’s attitude and
commitment towards its customers. Any business organization can
only thrive and prosper, if it keeps in mind the well being of its
customers and how to provide the customers with customer satisfying
products and services in terms of quality and satisfaction. HDFC Bank
has been successful and a pioneer in achieving that, and so stands
way ahead of its competitors.
For penetrating more market in terms of FDs, strategic marketing and
communication with the people which could be the future customers
of the HDFC Bank and providing them with the knowledge of the
various services and products related to the Fixed Deposits is to be
communicated so as to increase the market in terms of service,
quality and also the number of customers. There is a great market
opportunity in the urban, as well as rural areas, which has to be
worked upon. More and more number of branches and value added
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services like Phone banking, Net banking etc. have to be increased so
as more and more people of the society can avail and get informed of
the hassle free services of the HDFC Bank. Various innovative
marketing strategies like tele marketing, brochures, door-to-door
marketing, shows and programmers in various places need to be
carried out for making more and more people informed of the
products coming under the Fixed Deposit category, and eventually
leading to increase of market size and the number of future customers
for the HDFC Bank.
BIBLIOGRAPHY
1.BOOKS & AUTHORS
· Marketing Management
2. NEWS PAPERS
· Times of India
· Financial Express
3. WEBSITES
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