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Executive SummaryExecutive Summary
The banking sector in India has become very much competitive in the last few years
with the increasing growth of private and public sector banks. Day by day the competition is
becoming more stringent and crucial.
I undertook training in AXIS bank limited for profiling to understand the banking
operations and services provided by AXIS bank. The topic "Branch Banking" helped to
understand the overall banking operations of a branch.
This project is basically being formulated to study the branch banking operations in
the Branch of Axis Bank. This includes parameters like overall performance, current account,
saving account, and other facilities being provided by AXIS BANK. It also includes a study
of customer centricity approach of AXIS bank.
The market needs are continuously changing and so are the needs of the Current
account & Savings account holders. The major backup of any nation are the industrialists of
the same and the prior to them is the facility of the current accounts and customer of banks
which open saving account. Hence the facilities equipped in current accounts & saving
account is always a task for research.
AXIS Bank is one of the fastest growing banks in the country and has an extremely
competitive and profitable banking franchise evidenced by: Comprehensive portfolio of
banking services including Corporate Credit, Retail Banking, Business Banking, Capital
Markets, Treasury and International Banking. The quality of service is best among the
competitors
This Project Report involves an attempt to bring forward the various facilities being
provided by the top privatized bank as for the current account& saving account holders. Also
the significance of AXIS BANK has been brought forward in the report.
As this project is a part of the academic curriculum, the learnings and experiences from the training at AXIS Bank are also included in this report.
Industry Overview
(Banking Industry)Banking - An overview:
Banking is an activity of engaging in the business of keeping money for savings and
checking accounts, for exchange or for issuing loans and credit, transacting business with a
bank; depositing or withdrawing funds or requesting a loan etc. In general terms, the business
activity of accepting and safeguarding money owned by other individuals and entities, and
then lending out this money in order to earn a profit.
Banking in the modern sense of the word can be traced to medieval and early
Renaissance Italy, to the rich cities in the north like Venice and Genoa who dominated
banking in 14th century, establishing branches in many other parts of Europe. Perhaps the
most famous Italian bank was the Medici bank, set up by Giovanni Medici in 1397. The
earliest known state deposit bank, Banco di San Giorgio (Bank of St. George), was founded
in 1407 at Genoa, Italy
The oldest bank still in existence is Monte dei Paschi di Siena, headquartered in
Siena, Italy, which has been operating continuously since 1472.
Banking In India Overview:
Banking in India originated in the first decade of 18th century. The first banks were
The General Bank of India, which started in 1786, and Bank of Hindustan, both of which are
now defunct. The oldest bank in existence in India is the State Bank of India, which
originated in the "The Bank of Bengal" in Calcutta in June 1806. This was one of the three
presidency banks, the other two being the Bank of Bombay and the Bank of Madras. The
presidency banks were established under charters from the British East India Company. They
merged in 1925 to form the Imperial Bank of India, which, upon India's independence,
became the State Bank of India. For many years the Presidency banks acted as quasi-central
banks, as did their successors. The Reserve Bank of India formally took on the responsibility
of regulating the Indian banking sector from 1935. After India's independence in 1947, the
Reserve Bank was nationalized and given broader powers.
Banking History:
The first fully Indian owned bank was the Allahabad Bank, established in 1865.
However, at the end of late-18th century, there were hardly any banks in India in the modern
sense of the term. The American Civil War stopped the supply of cotton to Lancashire from
the Confederate States. Promoters opened banks to finance trading in Indian cotton. With
large exposure to speculative ventures, most of the banks opened in India during that period
failed. The depositors lost money and lost interest in keeping deposits with banks.
Subsequently, banking in India remained the exclusive domain of Europeans for next several
decades until the beginning of the 20th century. Foreign banks too started to arrive,
particularly in Calcutta, in the 1860s. The Comptoire d'Escompte de Paris opened a branch in
Calcutta in 1860, and another in Bombay in 1862; branches in Madras and Pondichery, then a
French colony, followed. Calcutta was the most active trading port in India, mainly due to the
trade of the British Empire, and so became a banking centre.
Around the turn of the 20th Century, the Indian economy was passing through a
relative period of stability. Around five decades had elapsed since the Indian Mutiny, and the
social, industrial and other infrastructure had improved. Indians had established small banks,
most of which served particular ethnic and religious communities.
By the 1900s, the market expanded with the establishment of banks such as Punjab
National Bank, in 1895 in Lahore and Bank of India, in 1906, in Mumbai - both of which
were founded under private ownership. Punjab National Bank is the first Swadeshi Bank
founded by the leaders like Lala Lajpat Rai, Sardar Dyal Singh Majithia. A number of banks
established then have survived to the present such as Bank of India, Corporation Bank, Indian
Bank, Bank of Baroda, Canara Bank and Central Bank of India.
Structure of Banking in India:
Indian Banking Sector:
The last decade has seen many positive developments in the Indian banking sector.
The policy makers, which comprise the Reserve Bank of India (RBI), Ministry of Finance
and related government and financial sector regulatory entities, have made several notable
efforts to improve regulation in the sector. The sector now compares favourably with banking
sectors in the region on metrics like growth, profitability and non-performing assets (NPAs).
A few banks have established an outstanding track record of innovation, growth and value
creation. This is reflected in their market valuation. However, improved regulations,
innovation, growth and value creation in the sector remain limited to a small part of it. The
cost of banking intermediation in India is higher and bank penetration is far lower than in
other markets. India’s banking industry must strengthen itself significantly if it has to support
the modern and vibrant economy which India aspires to be. While the onus for this change
lies mainly with bank managements, an enabling policy and regulatory framework will also
be critical to their success.
RBIScheduled Bank
Scheduled Commercial Banks
Pubilc Sector Banks
Private Sector Banks
Foreign Banks
Regional Rural Banks
Scheduled Cooperative BanksScheduled Urban Cooperattive
Banks
Scheduled State Cooperative Banks
Non-Scheduled Bank
Public Sector banking in India:
Banking System in India is dominated by nationalized banks. The nationalization of
banks in India took place in 1969 by Mrs. Indira Gandhi the then prime minister. The major
objective behind nationalization was to spread banking infrastructure in rural areas and make
available cheap finance to Indian farmers. Fourteen banks were nationalized in 1969. Before
1969, State Bank of India (SBI) was the only public sector bank in India. SBI was
nationalized in 1955 under the SBI Act of 1955. The second phase of nationalization of
Indian banks took place in the year 1980. Seven more banks were nationalized with deposits
over 200 crores.
Private Sector Banking in India:
All the banks in India were earlier private banks. They were founded in the pre-independence
era to cater to the banking needs of the people. But after nationalization of banks in 1969
public sector banks came to occupy dominant role in the banking structure. Private sector
banking in India received a fillip in 1994 when Reserve Bank of India encouraged setting up
of private banks as part of its policy of liberalization of the Indian Banking Industry. 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. Private Banks have played a major role in the development of Indian banking
industry. They have made banking more efficient and customer friendly. In the process they
have jolted public sector banks out of complacency and forced them to become more
competitive.
OPPORTUNITIES AND CHALLENGES FOR PLAYERS
The bar for what it means to be a successful player in the sector has been raised. Four
challenges must be addressed before success can be achieved. First, the market is seeing
discontinuous growth driven by new products and services that include opportunities in credit
cards, consumer finance and wealth management on the retail side, and in fee-based income
and investment banking on the wholesale banking side. These require new skills in sales &
marketing, credit and operations. Second, banks will no longer enjoy windfall treasury gains
that the decade-long secular decline in interest rates provided. This will expose the weaker
banks. Third, with increased interest in India, competition from foreign banks will only
intensify. Fourth, given the demographic shifts resulting from changes in age profile and
household income, consumers will increasingly demand enhanced institutional capabilities
and service levels from banks.
List of some Public & Private Sector Banks in India is as Follows
Public Sector Banks Private Sector Banks
Allahabad Bank
State Bank of India
State bank of Indore
State bank of Mysore
Bank of India
Bank of Maharashtra
Dena bank
HDFC bank
ICICI bank
AXIS bank
Bank of Rajasthan
Dhanalakshmi bank
Federal bank
IDBI bank
Yes bank
Company Overview
- AXIS Bank
Introduction to AXIS Bank:Axis Bank was the first of the new private banks to have begun operations in 1994,
after the Government of India allowed new private banks to be established. The Bank was
promoted jointly by the Administrator of the specified undertaking of the Unit Trust of India
(UTI - I), Life Insurance Corporation of India (LIC) and General Insurance Corporation of
India (GIC) and other four PSU insurance companies, i.e. National Insurance Company Ltd.,
The New India Assurance Company Ltd., The Oriental Insurance Company Ltd. and United
India Insurance Company Ltd.
The Bank as on 30th June, 2011 is capitalized to the extent of Rs. 411.88 crores with
the public holding (other than promoters and GDRs) at 52.87%.
The Bank's Registered Office is at Ahmedabad and its Central Office is located at
Mumbai. The Bank has a very wide network of more than 1281 branches (including 169
Service Branches/CPCs as on 31st March, 2011). The Bank has a network of over 6270
ATMs (as on 31st March, 2011) providing 24 hrs a day banking convenience to its
customers. This is one of the largest ATM networks in the country.
The Bank has strengths in both retail and corporate banking and is committed to
adopting the best industry practices internationally in order to achieve excellence.
This is the first bank in India to offer the AT PAR Cheque facility, without any
charges, to all its Savings Bank customers in all the places across the country where it has
presence. With the AT PAR cheque facility, customers can make cheque payments to any
beneficiary at any of its existence place. The ceiling per instrument is Rs. 50,000. The latest
offerings of the bank along with Dollar variant is the Euro and Pound Sterling variants of the
International Travel Currency Card. The Travel Currency Card is a signature based pre-paid
travel card which enables traveler’s global access to their money in local currency of the
visiting country in a safe and convenient way. The Bank has strengths in both retail and
corporate banking and is committed to adopting the best industry practices internationally in
order to achieve excellence. Axis Bank is one of the fastest growing banks in the country and
has an extremely competitive and profitable banking franchise evidenced by: Comprehensive
portfolio of banking services includes Corporate Credit, Retail Banking, Business Banking,
Capital Markets, Treasury and International Banking.
History of Axis bank:
Axis Bank Limited, formerly UTI Bank, (BSE: 532215, LSE: AXBC) is a financial
services firm that had begun operations in 1994, after the Government of India allowed new
private banks to be established. The Bank was promoted jointly by the Administrator of the
Specified Undertaking of the Unit Trust of India (UTI-I), Life Insurance Corporation of India
(LIC), General Insurance Corporation Ltd., National Insurance Company Ltd., The New
India Assurance Company, The Oriental Insurance Corporation and United India Insurance
Company UTI-I holds a special position in the Indian capital markets and has promoted many
leading financial institutions in the country. The bank changed its name to Axis Bank in April
2007 to avoid confusion with other unrelated entities with similar name. After the Retirement
of Mr. P. J. Nayak, Shikha Sharma was named as the bank's managing director and CEO on
20 April 2009.
Mission and Values:
Customer Service and Product Innovation tuned to diverse needs of individual and
corporate clientele.
Continuous technology up gradation while maintaining human values.
Progressive globalization and achieving international standards.
Efficiency and effectiveness built on ethical practices Customer Satisfaction through
providing quality service effectively and efficiently.
"Smile, it enhances your face value" is a service quality stressed on Periodic
Customer Service Audits.
Maximization of Stakeholder value.
Corporate Relationships:
Max New York Life Insurance Company:
Products:
1. Traditional Plans (Whole Life Participating Insurance Policy, Life Partner
plus Policy)
2. Ul Common ConceptUl Common Concept
3. Ulpss(Smart Investment Pension Super, Smart Xpress, Fortune Builder, Shiksha Plus)
4. Universal LifeSecure Dreams
5. Riders(Payor Benefit Riders, Dread Disease, Personal Accident Benefit, Waiver of Premiums)
BAJAJ ALLIANZ (General Insurance)
Health Guard Jewellery Insurance Business Advantage Travel Elite Safe Home Plus Family Floater Health Guard Silver Health
Management of Company:
Board of Directors:The members of the Board are:
Dr. Adarsh Kishore Non-Executive Chairman
Smt. Shikha Sharma Managing Director & CEO
Shri S.K. Chakrabarti Deputy Managing Director
Shri J.R. Varma Director
Dr. R.H. Patil Director
Smt. Rama Bijapurkar Director
Shri R.B.L. Vaish Director
Shri M.V. Subbiah Director
Shri K. N. Prithviraj Director
Shri V. R. Kaundinya Director
Shri S. B. Mathur Director
Highlights Profit after tax up 34.76% to Rs. 3,388.49 crores
Net Interest Income up 31.14% to Rs. 6,562.99 crores
Fee & Other Income up 32.39% to Rs. 4,135.16 crores
Deposits up 33.93% to Rs. 18,9237.8 crores
Demand Deposits up 17.78% to Rs. 77,767.40 crores
Advance up 36.48% to Rs. 1,42,407.83 crores
Retail Assets up 33.32% to Rs. 27,759.23 Crores
Network of branches and extension counters increased from 983 to 1,390
Total number of ATMs went up from 4,293 to 6,270
Net NPA ratio as a percentage of net customer assets down to 0.26% from 0.36%
Earnings per share (Basic) increased from Rs. 65.78 to Rs.82.95
Proposed Dividend up from 120% to 140%
Competitors:
Private Sector competitors:
HDFC BANK
YES BANK
ICICI BANK
Public Sector competitors:
STATE BANK OF INDIA
PUNJAB NATIONAL BANK
DENA BANK.
PRODUCTS & SERVICES:
Savings Acounts Of Axis Bank:
1. EasyAccess Savings Account:
This account is an endeavor by the Bank to understand the consumers' needs and
redefine banking to suit the customer's requirements for a truly comfortable banking
experience. EasyAccess Savings Account gives an instant access to customer's money
anywhere, anytime. Possessing a range of unmatched features, it has been devised to better
suit the convenience of our eclectic client base.
One can avail of all these services with a minimum quarterly average balance of Rs.
5,000 in metro or urban centers, Rs. 2,500 in semi urban centers and Rs. 1,000 in rural
centers
2. Krishi Savings Account:
Axis Bank offers a unique savings account which is easy to operate and allows you to
transact immediately. This product has been specially designed keeping in mind the unique
requirements of a farmer and others employed in the allied agricultural activities sector. Thus
this product has been called the Krishi Savings Account.
The Krishi Savings Account has also been extended for some of the "Allied
Agricultural Activities" like Animal Husbandry; Dairy/Poultry Farming, Fishery &
Aquaculture Sector; Horticulture; Sericulture; Floriculture; Handicraft Industry (Registered
with Khadi and Gram-Udyog Dept); etc.
Average Balance Requirement
This account is offered with the requirement of maintaining the half-yearly average
balance of Rs 1000 only.
3. Prime Savings Account:
At Axis Bank, we have always strived to pace our products with the growing
needs of our customers. The Prime Savings account has therefore been created with your
specific financial requirements in mind.
Features
Wider accessibility
Greater convenience
More comfort
Enhanced privileges
Enhanced privileges
One can avail of all these services with a minimum average balance of Rs 25,000 in
metro/urban/semi-urban centers and Rs 10,000 in rural centers.
4. Salary Account:
Axis Bank, believes in providing total financial solutions to the employer as well as
the employee, through the salary relationship. We understand that each employee in an
organization is at a different station of life having different financial and banking needs.
Benefits for the employees
Convenience in banking:
Anywhere Banking at any of our over 1200 branches and a network of over 5500
ATMs spread across more than 796 centers
Multi-city at par chequebooks
Electronic Fund Transfer facility across all banks in India
Internet Banking with Fund transfer facility to self and third party accounts
24x7 convenience at no charges with Axis Mobile
Free SMS Banking with features such as alerts on debits / credits over Rs.5,000/-
balance enquiry, enquiry on last 3 transactions and status of cheque clearance etc
Benefits on charges:
No penal charges related to minimum balance
Concessions on Pay Orders / Demand Drafts issued at Axis Bank locations
Debit and Pre-paid Cards:
International Debit Card with free Personal Accident cover
Debit card for spouse in case of joint account
Travel Currency Card providing great convenience to off-shore employees for carrying
local currency
Retail Lending:
Facility of Temporary Overdraft with the salary account
Preferential pricing on Retail Loans, as per eligibility criteria
Additional Banking Privileges:
Employee Reimbursement Account offered as a savings account variant with interest payable
quarterly
Benefits for the employer
Efficient disbursal of salary
Web Upload facility enabling your payroll department to upload salaries at its own
convenience
An Axis Bank official can be designated at your major locations for addressing all
queries and issues from HR department
An ATM can be specially installed at the work premises for added convenience in cash
withdrawals, subject to terms and conditions
5. Priority Account:
Axis Bank believes in relationships lasting beyond more transactions. Alongwith
providing preferential banking services, the bank also strive to form a long term bond of trust
and satisfaction with the customer. That's why AXIS has brought the Axis Bank Priority, a
preferential banking experience for selected customers. A service that would ensure not only
the highest level of Priority but also preferential treatment to selected customers.
6. Women's Savings Account:
The account is an endeavor by the Bank to understand the women's' needs and
redefine banking to suit their requirements for a truly comfortable banking experience.
Women's Savings Account gives an instant access to ones money anywhere, anytime. With
the Women's Savings Account, one can manage own money and life and Furthermore Axis
Bank's Women's Savings Account ensures that one have enough time for all the important
things in life.
7. Senior Citizen's Account:
It is a banking style that compliments ones Senior status. The account is an endeavour
by the Bank to understand the consumers' needs and redefine banking to suit their
requirements for a truly comfortable banking experience. Senior citizen Savings Account
gives an instant access to their money anywhere, anytime. Axis Bank's Senior Citizen
Savings Account has been designed keeping in mind the fact that a Senior citizen's banking
requirements are wholly different and require special consideration.
8. Demat Account:
Axis Bank is a registered member (Depository Participant) of NSDL. In this system,
physical security holdings are converted into electronic (or in other words, dematerialized)
holdings. Axis Bank has been enrolled as a Depository Participant by the NSDL - India's first
depository. One can avail of all the depository-related services by just opening an account with
NSDL through Axis Bank.
9. Azaadi - No Frills Account:
In this Zero Balance Savings Account there is no need to maintain a fixed minimum
balance, mandatory amount in the account.
One qualify for Azaadi account if;
The sum total of all credits to ones account does not exceed Rs 1 lac during the
Financial year,
One do not intend to maintain an account balance higher than Rs 50,000 at any given
instant, and
One is unable to furnish full documentation as required ordinarily for fulfilling of
account opening norms
10. Defence Salary Account:
It is a Salute to the defence forces. Defence Salary Account from Axis Bank is a
product designed keeping in mind how tough a life in the Defence Forces is. Not only does it
come absolutely free, no minimum balance is required either. One can also access the entire
Axis Bank network, no matter where one is posted. With the complete gamut of banking
services (including overdrafts, loans and zero-balance requirements) one can now rest assured
about their family and all their financial needs.
11. Trust/Ngo Savings Account:
Axis Bank's Trust Account is an effort to offer thoughtful banking for people who
spend their lives thinking of others. It is a complete banking solution for Trusts, Associations,
Societies, Government Bodies, Section 25 companies and NGOs, so that the organisations can
devote all of their time to their noble motivations.
12. Pension Savings Account
Pension Savings Bank Account, from Axis Bank is specifically, designed for
Pensioner's (Existing & Prospective) of Central Govt. Civil Ministries/ Departments &
Defence Ministry keeping in mind the fact that a Pensioner's banking requirements are wholly
different and require special consideration.
Current Account At Axis Bank:
Axis bank offers a wide range of current account products to suit its customers to suit
their business requirements. Each current account is customised to ensure efficient account
management, quick transfer of funds across the Axis Bank network coupled with modern day
electronic methods to stay in touch with the account on a real time basis.
Following are the various CURRENT ACCOUNTS offered by Axis Bank:
1. Club 50:
This unique and unparalleld product in the Industry comes with a half-yearly Average
Balance of Rs.50 lacs. The account is loaded with value added features like free doorstep
banking services, cheque protection facility, free Anywhere banking, free home branch cash
deposit upto Rs.2 crores per month, free RTGS/NEFT facility, free DD/PO and also a
Relationship Manager taking care of the account holders daily banking requirements.
Additional benefits offered to this account are continuous cheque stationary with hologram,
subscription to magazines, Gold Plus credit card, complementary Priority Banking accounts
and other lifestyle benefits/privileges.
2. Channel One:
This premium account comes equipped with a host of features like free doorstep
banking, cheque protection facility, free Anywhere banking ,free fund transfer, free home
branch cash deposit upto Rs.1.2 crores per month, free RTGS/NEFT facility along with a
Relationship Manager taking care of the daily banking requirements of the account holder.
This high-end current account comes with a Monthly Average Balance requirement of Rs.10
lacs.
3. Bussiness Privilage:
This current account with a monthly average balance of Rs.5 lacs, has been designed
to suit the transactional needs of the bank's valuable clients and offers enhanced free limits of
home branch cash deposit upto Rs. 60 lacs, free DD/PO and Anywhere Banking upto Rs.6
crores, free funds transfer amongst many other privilages.
4. Business Classic:
The Business Classic current account comes equipped to take care of the growing
business needs of the account holder with free limit of Rs.12 Lacs an home branch cash
deposit, free DD/PO & Anywhere Banking upto Rs.1.2 crores, free funds transfer, etc. All
these come with a Monthly Average Balance requirements of Rs.1 lac only.
5. Business Select:
This unique current account is the first of its kind, which has both flexibility and
fungibility of free limits as its core feature. The flexible limits allow a cash deposit , both
home branch and non home branch, of upto 12 times the Monthly Average Balance
maintained in the same charge cycle, with an assured free limit of Rs.6 lacs. The account also
has a combined free Anywhere banking and DD/PO limit of Rs.60 lacs per month and many
more attractive features at a Monthly Average Balance requirement of Rs.50,000/-.
6. Business Advantage:
The Business Advantage Account, with a Monthly Average Balance requirement of
Rs.25,000/-. It comes loaded with features, which include free home branch cash deposit upto
Rs.3 lacs, free limits for DD/PO & anywhere banking upto Rs.30 lacs, free funds transfer etc.
7. Normal Current Account:
This current account is designed for a Monthly Average Balance of Rs.10,000/-
comes with features like free home branch cash deposit upto Rs.1.2 lacs, DD/PO &
Anywhere banking free upto Rs.12 Lacs, free fund transfer, etc.
Collection and Payment Solutions:
In today’s competitive market place, effectively managing cash flow can make the
difference between success and failure. The Bank's cash-flow solutions gives the customer
maximum control over this vital asset. Whether one does business locally or throughout
India, bank can provide with innovative & integrated cash management solutions tailored to
ones specific needs. Bank's Cash Management products enable the efficient utilisation of
one's receivables through coordinated management of payments, collections and balances in
ones accounts. The objectives are to reduce costs, enhance control and optimise returns by
leveraging banking expertise for mutual gains. Besides banks online collection solutions like
Internet Payment Gateway & Point of Sales terminal will further smoothen ones receivables
management.
Banks extensive network, robust processes, online connectivity, web enabled
collection and payment solutions with single point contact and experienced team across the
country provides a complete transactional banking solution.
Term Deposits At Axis Bank:
1. Recurring Deposits:
Axis Bank's Recurring Deposit scheme will allow the customer with an opportunity to
build up their savings through regular monthly deposits of fixed sum over a fixed period of
time.
Features:
Recurring deposits are accepted in equal monthly installments of minimum Rs 1,000
and above in multiples of Rs 500 thereafter.
The fixed numbers of instalments for which a depositor can opt are 12, 24, 36, 39, 48,
60, 63, 72, 84, 96, 108 and 120 months.
Transfer of Accounts - a recurring deposit account can be transferred from one office
of the Bank to another branch.
The amount of instalment once fixed, cannot be changed.
Instalment for any calendar month is to be paid on or before the last working day of
the month. Where there is delay in payment of instalment, one can regularize the
account by paying the defaulted instalment together with a penalty (at present it is @
PLR plus 4 % for the period of delay).Fraction of a month will be treated as full
month for the purpose of calculating the penalty.
The total amount repayable to a depositor, inclusive of interest, depends on the
amount of monthly instalments and the period of deposit.
2. Encash 24:
The Encash 24 (Flexi Deposit) gives the liquidity of a Savings Account coupled with
high earnings of a Fixed Deposit. This is achieved by creating a Fixed Deposit linked to ones
Savings Account providing the following unique facilities:
Maximum Returns:
As soon as the balance in ones Savings Account crosses over Rs 25,000, the excess, in
multiples of Rs 10,000 will be transferred automatically to a higher interest earning Fixed
Deposit Account. The maturity of fixed or term deposits formed as a result of transfer of
money from the Savings Bank account will be for a maximum period of 181 days and the
interest will be calculated on simple interest rate basis.
Maximum Liquidity:
The money parked in Fixed Deposits as a result of the above mentioned sweep out
from your Savings account can be easily accessed by issuing a cheque, withdrawing through
ATM etc. This amount is automatically reverse swept from the most recently formed Fixed
Deposit in units of Rs 5,000 to the Savings account whenever the balance in your Savings
account falls below Rs 25,000. The amount broken form your Fixed Deposit will earn interest
rates at the applicable rate for the period that the deposit was held with the Bank. The
remaining amount of Fixed Deposit will continue to earn the contracted rate of interest.
Auto Renewal:
On maturity of your linked Fixed Deposit, the Bank will automatically renew it for a
maximum period of 181 days.
3. Tax Saver Fixed Deposit:
In the Finance Bill of 2006, the government had announced Tax benefits to Bank
Term Deposits which are of over 5 year tenure u/s 80C of IT Act, 1961 vide Notification
Number 203/2006 and SO1220 (E) dated 28/07/2006.
The salient points of the scheme notification are; (a) Fixed tenure without premature
withdrawal. (b) Year is defined as a financial year. (c) Amount limited to Rs. 100 minimum
and Rs. 100,000 maximum. (d) Bank will issue a Fixed Deposit Receipt that shall be the basis
of claiming tax benefit.
Benefits of tax break u/s 80C of IT Act Benefit Illustrator Example:
Assume that a customer invests Rs 100,000 in this scheme @ 8% p.a. in fixed deposit
for five years. He will get a benefit of Rs 30,600 at 30.6 % on the eligible investment of INR
100,000 assuming that he is in Rs 2,50000 lac to Rs 10,0000 lac tax bracket, thus his
effective investment would be Rs 69,400. He would earn Rs 8000 (08 percent on 1 lac) as
interest per annum, which would translate to a return of 11.5 percent on the effective
investment of Rs 69,400.
"BRANCH BANKING"
INTRODUCTION
Branch Banking - An Overview
A bank is a financial institution which deals with
deposits, loans, advances and other related services. It receives
money from those who want to save in the form of deposits and
it lends money to those who need it.
A bank is a financial intermediary and appears in several related
basic forms:
a central bank issues money on behalf of a government, and regulates the money
supply
a commercial bank accepts deposits and channels those deposits into lending
activities, either directly or through capital markets. A bank connects customers with
capital deficits to customers with capital surpluses on the world's open financial
markets.
a savings bank, also known as a building society in Britain is only allowed to borrow
and save from members of a financial cooperative.
A Bank's main source of income is interest. A bank pays out at a lower interest rate on
deposits and receives a higher interest rate on loans. The difference between these rates
represents the bank's net income.
Oxford Dictionary defines a bank as "an establishment for custody of money, which it
pays out on customer's order."
A bank is an establishment that helps individuals and organizations, in the issuing,
lending, borrowing and safeguarding functions of money.
The term "bank" is derived from the French word "Banco" which means a Bench or
Money exchange table. In olden days, European money lenders or money changers used to
display (show) coins of different countries in big heaps (quantity) on benches or tables for the
purpose of lending or exchanging.
Concept of "Branch Banking":
Branch is considered as one of the most important
channel of the bank and is generally the most preferred channel
from the customer's point of view. The branch is referred to as
the face of the bank since the customer can visit personally and
meet and interact with the branch officials and avail the various
services offered by the bank. In reality, the branch is the sales and service channel of a bank
and the branch employees are generally responsible for both sales and service of bank's
products. Sales in terms of branch banking could be of any of the bank's deposits, products,
gold, retail or other investment products of other approved organizations, such as life
insurance, general insurance, and mutual fund.
Branch Banking operations refer to certain banking operations carried out by a bank
in certain specific branches. The most common examples of deposit products of a bank are
savings bank account, current accounts, fixed deposit accounts, and recurring deposit
accounts. The customers or the prospects desiring to open any of these accounts have to fill
an Account Opening Form [AOF] and submit the specified documents in order to meet the
Know Your Customer [KYC] guidelines issued by the Reserve Bank of India [RBI]
In most of the banks, the front office activities that involve customer interaction are
handled at the branches, for instance, cash receipts and payments, issue of DD or lockers. The
back office activities, such as clearing and account opening may be centralized at a different
location away from the branch. Activities like clearing centralize payments of drafts and
other instruments, which are related to the local area, may be grouped in to one centre.
Certain other activities that are common across centres may be performed at another place for
the purpose of achieving efficiency of operation and controlling costs.
Literature Review (On Branch Banking)
1. Branch Banking, Bank Competition, and Financial Stability
(Mark Carlson, Kris James Mitchener, NBER Working Paper No. 11291)
- Issued in May 2005.
It is often argued that Branch Banking stabilizes banking systems by facilitating
diversification of bank portfolios; however, previous empirical research on the Great
Depression offers mixed support for this view. Analyses using state-level data find that states
allowing branch banking had lower failure rates, while those examining individual banks find
that branch banks were more likely to fail. We argue that an alternative hypothesis can
reconcile these seemingly disparate findings. Using data on national banks from the 1920s
and 1930s, we show that branch banking increases competition and forces weak banks to exit
the banking system. This consolidation strengthens the system as a whole without necessarily
strengthening the branch banks themselves.
2. Branch Banking - As a Device for Discipline: Competition and Bank Survivorship
During the Great Depression.
(Mark Carlson, Kris James Mitchener, NBER Working Paper No. 12938)
- Issued in February 2007.
Because California was a pioneer in the development of intrastate branching, we use
its experience during the 1920s and 1930s to assess the effects of the expansion of large-
scale, branch-banking networks on competition and the stability of banking systems. Using a
new database of individual bank balance sheets, income statements, and branch
establishment, we examine the characteristics that made a bank a more likely target of a
takeover by a large branching network, how incumbent unit banks responded to the entry of
branch banks, and how branching networks affected the probability of survival of banks
during the Great Depression. We find no evidence that branching networks expanded by
acquiring "lemons"; rather those displaying characteristics of more profitable institutions
were more likely targets for acquisition. We show that incumbent, unit banks responded to
increased competition from branch banks by changing their operations in ways consistent
with efforts to increase efficiency and profitability. Results from survivorship analysis
suggest that unit banks competing with branch bank networks, especially with the Bank of
America, were more likely to survive the Great Depression than unit banks that did not face
competition from branching networks. Our statistical findings thus support the hypothesis
that branch banking produces an externality in that it improves the stability of banking
systems by increasing competition and forcing incumbent banks to become more efficient.
3. Successful Branch Transformations: Towards needs-based sales and service-
oriented delivery
- (Asian Banker Research, White Paper)
FOCUS ON THE FUTURE OF BRANCH BANKING
(The next generation of branch banking in the Asia Pacific region)
While in the last years the retail financial services industry in Asia has paid significant
attention to the development of e-banking, with many banks rolling out full-fl edged mobile
phone banking propositions in 2009 in particular, smart banks have never lost their focus on
fine-tuning their branch propositions and upgrading their infrastructure, seeing it as a key
success element in their overall network architecture as they represent the centre of building
sustainable customer relationships and business growth. Despite criticisms, the predominant
branch concept going forward will continue to be the one-stop shop, in particular for local
domestic banks.
They are building branches that are designed to cater more effectively to surrounding
communities by offering extraordinary levels of customer experience, service quality and
efficiency. The timing and degree to which a bank moves forward in transforming its branch
network will depend on market factors, demographics, customer preferences and a bank’s
own financial constraints and staffing capabilities, branch banking is moving away from an
undifferentiated, unintentional and inconsistent interaction with the customer to a branded
one which is actually valued by all segments because the proposition is relevant.
A major survey by Asian Banker Research indicates that a growing pool of banks
have begun assigning more capital for branch transformations. The new wave of branch
banking projects addresses the creation of superior front line execution by marrying front line
automation, workflow process optimization and the human element. More attention is also
paid to interactivity, discovery and instant delivery to assist in creating a market beating
customer experience for gaining competitive advantage.
ObjectivesObjectives
To get the knowledge of the concept of branch banking.
To study the different products and services offered by the bank.
To study the Customer Centricity approach of the Bank.
To understand the banks vision
Research Methodology
Introduction:
Research is systematic quest of knowledge. The purpose of research is to discover
answers to questions through the application of certain procedures. The research design
applied in the project is Descriptive research design as the major objective of the research is
to describe the preferences of the AXIS bank's customers. And the action which banks takes
to accomplish the goal of customer centricity.
Research Design:
Descriptive Research Design:
The major objective of descriptive research is to describe something usually market
characteristics and finding out views preferences of customers. It also includes surveys and
fact-finding enquiries of different kinds.
Descriptive research is preplanned and structured. It is typically based on
representative samples. A formal research design specifies the method for selecting the
sources of information and for collecting data from those sources.
Sampling:
Sample Element:
An element is the object about which or from which the information is desired . The
sample element of this project is the Customers who have their Saving and Current accounts
in Axis Bank in Ambernath.
Sampling Extent:
It refers to geographical boundaries in which sampling has been done. The sampling
extent of this project is Ambernath.
Sampling Size:
It refers to the number of units to be included in the study. The sampling size of the
study is 50 People who have their Savings and Current accounts in AXIS bank.
Sampling Technique:
The sampling technique refers to the technique used for getting response from the
respondent. Probability sampling refers to the technique wherein each and every unit of the
universe has an equal chance of being selected as sample. Non probability sampling refers to
the technique wherein each and every unit does not stand an equal chance of being as sample
and sample chosen relies on the personal judgment of researcher. The researcher can
arbitrarily or consciously decide what elements to include in the sample.
For the purpose of this study, Probability Sampling is used which relies on the chance to
select sample elements. The purpose of using this technique was to yield good estimates of
the population characteristics within non-probability sampling.
Convenient Sampling:
It is the least expensive and least time consuming of all sampling techniques.
Sampling units are accessible, easy to measure and co-operative so convenient sampling is
used for the purpose of project.
Instrument Decision:
A Structured set of Questionnaire supported by personal interviews has been used
to collect primary data in this project.
Data Collection:
The data collected for the research includes both primary and secondary data. The research used is descriptive and involve study of services provided by AXIS Bank and customer respond to services. Hence most of the data used is primary data. Secondary data has been used to support the study at some places. The information collected has been dissected and presented in a very lucid manner.
Methods Of Data Collection:
The task of data collection begins after a research design has been defined.
Collection Of Primary Data:
Several methods of collecting primary data, particularly in surveys and descriptive
researches are used. They are:
Observation method:
During the training program of two months, an observation was done of how
the bank employees perform their duties in the bank. Also it was observed that
what kind of customers visit the bank and how do employees deal with the
customers. The overall banking operations were also observed.
Interview method:
Both the structured and unstructured interview methods were used for
collecting primary data. A structured interview was done with the help of structured
questionnaires. Informal interactions with the bank employees and the customers
were also done for collecting the primary data.
Questionnaires:
A structured set of Questionnaire was prepared for collecting primary data.
The questionnaire was made for the Customers (Savings and Current Account
holders) of AXIS Bank.
In this project the source of primary data collection are structured
questionnaires supported by interviews.
Collection Of Secondary Data:
The collection of secondary data has been done by using various publications, books,
Manuals of AXIS bank, Annual reports, Bank's brochures, magazines, journals, newspapers
and internet. By way of caution, before using data, it was confirmed that it possess following
characteristics:
Reliability of data
Suitability of data
Adequacy of data
The information from the above sources has been searched, collected and interpreted in the best possible manner.
Data Interpretation And Analysis
ANALYSIS OF CUSTOMER CENTRICITY APPROACH OF AXIS BANK
ANALYSIS 1:This analysis displays the division of sample according to the occupation of 50 people who were surveyed.
Table 1
OCCUPATION Frequency PercentPublic Sector Employee 15 30Private Sector Employee 8 16Businessman 6 12Professional 17 34Retired 4 8Total 50 100
Public Sector Employee
Private Sector employee
Businessmen Professional Retired0
2
4
6
8
10
12
14
16
18
15
8
6
17
4
Occupation
Occupation
ANALYSIS 2: Are the customers satisfied with their savings and Current account?
86%
14%
No. Of People
YESNO
ANALYSIS 3: How the customers find savings and current account provided by Axis Bank?
46%
28%
22%4%
Customer Rating for Accounts
ExcellentVery goodGoodSatisfactorypoor
ANALYSIS 4: Do customers have any other product of AXIS BANK other than savings and
Current account? (Like term deposit, mutual funds, insurance, home loan, car loan etc.)
80%
20%
Third Party Products
YesNo
ANALYSIS 5: Which is better bank in ease of access (both branch & ATM)?
58%26%
10%6%
Better Banks in ease of access
AXIS HDFCICICIOthers
ANALYSIS-6: Which bank’s accounts provide greater flexibility?
40%
28%
24%
8%
Flexibilty Of Banks
AXISHDFCICICIOthers
ANALYSIS-7: Are the customers satisfied with the relationship manager’s service provided by Axis Bank?
82%
18%
Relationship Manager service
YESNO
ANALYSIS-8: Which channel do customers use to access their account?
48%
12%
20%
20%
Accessing Account
DIRECT BRANCHMOBILE BANKINGNET BANKINGPHONE BANKING
ANALYSIS-9: Which are the areas of improvement?
36%
24%12%
12%
16%
Areas Of Improvement
UPDATESSERVICETECHNOLOGYRELATIONSHIP MANAGEMENTPRODUCTS
Findings and Analysis The bank has good relations with its customers. The customers are very much
satisfied with the relationship manager service provided by Axis Bank.
The AXIS bank and its customers have a long term relationship. AXIS Bank also has
many high profile customers.
Axis Bank has the tendency to retain its customers at any cost. They believe that the
old customer is more profitable instead of a new one that’s why they try to maintain
good and long term relations with their customers.
The customers prefer banking by visiting the branch.
Less number of customers use mobile banking or internet banking.
The accounts of axis bank (both savings and current) provide great flexibility in terms
of offering.
The accounts of these three banks don’t have much difference in terms of features but
when it comes to service providing the AXIS Bank gets an edge because of their great
customer services.
The axis bank has good number of branches and ATM’s that’s why it has more ease
of access and a large reach of their business.
The customers of Axis Bank are highly satisfied with their savings and current
accounts.
AXIS bank saving accountholders and current accountholders are now expanding
their investment portfolios.
The study shows the Customer Centricity and Customer orientation of AXIS Bank
towards its valuable customers.
The study also helps to know the customers perception, what they want from their
banks and how they take decision while selecting a bank to invest their hard earned
money.
In this study I found that the bond of Axis Bank with its customers is very strong,
because Axis Bank mainly focuses on retaining their customers.
Recommendations and ConclusionRECOMMENDATIONS
• A wide publicity to be given about the organization and its products through various
means of communications to keep growth moments.
• AXIS bank should target customers that are ranging between 25-30 age group because
it was found that they are more interested in taking Business loan & to apply for new
variety of accounts.
• To eliminate the dissatisfaction proper workshop and awareness programs like
campaigning are helpful.
• AXIS bank should lower the charges rate if the balance falls below Average quarterly
balance.
• AXIS bank should work on their field networking and services to enhance more
credibility.
• New and unique products should be launched to attract more customers.
• Even if customer service in AXIS is excellent, it should keep on improving.
• AXIS should always try to enter the new markets before its competitor enters and
captures it.
• AXIS can perform a good research before entering into a new market.
AXIS should increase its customer reach at a very high rate.
The bank should focus on the semi urban and rural market because these markets are
of very good opportunity for someone like Axis Bank which is in growing face.
Without expanding in these markets Axis Bank cannot be a leading bank so they
should focus on this market.
The bank should focus on mass banking in order to increase their market share. They
should launch such products which would be within the reach of the lower middle
class
The bank should pay more attention on giving updates and should increase the level
of service providing because the competitors of axis are better in this area.
The bank should try to increase the use of technology like mobile and net banking
among its customers.
CONCLUSION
While working with Axis Bank I found that AXIS BANK is one of the leading private
banks and provides commercial banking services. After changing its name as AXIS
BANK it promises to serve its customers the best in future. This bank has developed
manifold in short period of time due to better facilities and services provided to their
customers. The Implant training for a period of two months at AXIS BANK -
Ambernath Branch has proved to be very informative, useful and effective. The main
objective of this training programme was to observe and understand the actual branch
banking activities and working of an Organization from a Management point of view
and also to mutually benefit from the training. The training programme helped to
acquire the necessary management skills required. This training programme was
successfully completed with the support and guidance of the AXIS Bank’s Branch
head and other staff members. The customer survey in the study helped to know the
customer centricity approach and customer orientation of the AXIS bank towards its
customers. This study finds that however Axis Bank is not the major player in private
sector bank but its vast range of products and availability of options make it one of the
better leading banks in India and has a great potential to become a major player in the
private sector banks.
Limitations
Every research has its own constraints which keep limitations to work, similarly this
research has also limitations due to which the researcher could not get detailed information
regarding project. These are: -
The concept of Branch Banking being a very broad one, it was impossible to cover all
the facets of this subject.
Thus, it was difficult to do a detailed study on this subject.
To reduce the complexities in differentiating the various large number of products of
both the banks, only the Savings and Current Account were taken into consideration
for comparative study.
Due to different types in the savings and current account of both banks, only the
Normal/regular Savings and current account were compared.
Due to the limitation of time I was unable to cover more sample (data collection) and
to fridge the lead granted.
The views of the surveyed sample are considered as the views of the whole
population.
So, the data available for study is appropriate to the extent of the limited sample size
only.
Scope of the Study
The research study has a wide scope for the trainee, the bank and for the customers to
arrive upon certain conclusions.
a. For a trainee:
The research has provided the practical knowledge to the trainee regarding the
organization working, survey and other aspect of banking.
This research is also essential for a trainee in fulfillment of MBA curriculum
b. To the bank:
Research would help the bank to know the perception and satisfaction level of its
customers.
Research would help the bank to get the lead of potential customers.
The comparative analysis would help the bank to frame some strategies.
The suggestions provided in the research will be helpful for improvement of class and
quality of service to new and current customers and also help to enhance the
activities.
c. To the customer:
The comparative study would help the customers to decide which bank to invest their
hard earned money.
The research will become a medium to convey the dissatisfaction factor to the
appropriate person in the management.