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NET BANKING SERVICES OF PUNJAB NATIONAL BANK

RELEVANCE:Retail banking provides financial services for individuals and families. The three most important functions are credit, deposit, and money management. They are a component of commercial banking. First, retail banks offer consumers credit to purchase homes, cars, and furniture. These include mortgages, auto loans, and credit card. The resulting consumer spending drives almost 70 percent of the U.S. economy. They provide extra liquidity to the economy this way. Credit allows people to spend future earnings now. Retail banks also offer small business loans to entrepreneurs. These small companies create up to 65 percent of all new jobs as they grow

Origin:Punjab under the British especially after annexation in 1849 witnessed a period of rapid development giving rise to a new educated class fired with a desire for freedom from the yoke of slavery. Amongst the cherished desires of this new class was also an overriding ambition to start a Swadeshi Bank with Indian Capital and management representing all sections of the Indian community. The idea was first mooted by Rai Mool Raj of Arya Samaj who, as reported by Lala Lajpat Rai, had long cherished the idea that Indians should have a national bank of their own. He felt keenly "the fact that the Indian capital was being used to run English banks and companies, the profits accruing from which went entirely to the Britishers whilst Indians had to contend themselves with a small interest on their own capital". At the instance of Rai Mool Raj, Lala Lajpat Rai sent round a circular to selected friends insisting on an Indian Joint Stock Bank as the first special step in constructive Swadeshi. Lala Harkrishan Lal who had returned from England with ideas regarding commerce and industry, was eager to give them practical shape. `PNB was born on May 19, 1894. The founding board was drawn from different parts of India professing different faiths and a varied back-ground with, however, the common objective of providing country with a truly national bank which would further the economic interest of the country. The Bank opened for business on 12 April, 1895. The first Board of 7 Directors comprised of Sardar Dayal Singh Majithia, who was also the founder of Dayal Singh College and the Tribune; Lala Lalchand one of the founders of DAV College and President of its Management Society; Kali Prosanna Roy, eminent Bengali pleader who was also the Chairman of the Reception committee of the Indian National Congress at its Lahore session in 1900; Lala Harkishan Lal who became widely known as the first industrialist of Punjab; EC Jessawala, a well known Parsi merchant and partner of Jamshedji & Co. of Lahore; Lala Prabhu Dayal, a leading Rais, merchant and philanthropist of Multan; Bakshi Jaishi Ram, an eminent Civil Lawyer of Lahore; and Lala Dholan Dass, a great banker, merchant and Rais of Amritsar. Thus a Bengali, Parsi, a Sikh and a few Hindus joined hands in a purely national and cosmopolitan spirit to found this Bank which opened its doors to the public on 12th of April 1895. They went about it with a Missionary Zeal. Sh. Dayal Singh Majithia was the first Chairman, Lala Harkishan Lal, the first secretary to the Board and Shri Bulaki Ram Shastri Barrister at Lahore, was appointed Manager. A Maiden Dividend of 4% was declared after only 7 months of operation. Lala Lajpat Rai was the first to open an account with the bank which was housed in the building opposite the Arya Samaj Mandir in Anarkali in Lahore. His younger brother joined the Bank as a Manager. Authorised total capital of the Bank was Rs. 2 lakhs, the working capital was Rs. 20000. It had total staff strength of nine and the total monthly salary amounted to Rs. 320.

The first branch outside Lahore was opened in Rawalpindi in 1900. The Bank made slow, but steady progress in the first decade of its existence. Lala Lajpat Rai joined the Board of Directors soon after. in 1913, the banking industry in India was hit by a severe crisis following the failure of the Peoples Bank of India founded by Lala Harkishan Lal. As many as 78 banks failed during this crisis. Punjab National Bank survived. Mr. JH Maynard, the then Financial Commissioner, Punjab, remarked. "Your Bank survived...no doubt due to good management". It spoke volumes for the measure of confidence reposed by the public in the Bank`s management.The years 1926 to 1936 were turbulent and loss ridden ones for the banking industry the world over. The 1929 Wall Street crash plunged the world into a severe economic crisis. It was during this period that the Jalianwala Bagh Committee account was opened in the Bank, which in the decade that followed, was operated by Mahatma Gandhi and Pandit Jawaharlal Nehru. The five years from 1941 to 1946 were ones of unprecedented growth. From a modest base of 71, the number of branches increased to 278. Deposits grew from Rs. 10 crores to Rs. 62 crores. On March 31, 1947, the Bank officials decided to leave Lahore and transfer the registered office of the Bank to Delhi and permission for transfer was obtained from the Lahore High Court on June 20, 1947. PNB was then housed in the precincts of Sreeniwas in the salubrious Civil Lines, Delhi. Many a staff member fell victim to the widespread riots in the discharge of their duties. The conditions deteriorated further. The Bank was forced to close 92 offices in West Pakistan constituting 33 percent of the total number and having 40% of the total deposits. The Bank, however, continued to maintain a few caretaker branches. The Bank then embarked on its task of rehabilitating the displaced account holders. The migrants from Pakistan were repaid their deposits based upon whatever evidence they could produce. Such gestures cemented their trusts in the bank and PNB became a symbol of Trust and a name you can bank upon. Surplus staff posed a big problem. Fast expansion became a priority. The policy paid rich dividends by opening up an era of phenomenal growth. In 1951, the Bank took over the assets and liabilities of Bharat Bank Ltd. and became the second largest bank in the private sector. In 1962, it amalgamated the IndoCommercial Bank with it. From its dwindled deposits of Rs. 43 crores in 1949 it rose to cross the Rs. 355 crores mark by the July 1969. Its number of offices had increased to 569 and advances from Rs. 19 crores in 1949 to Rs. 243 crores by July 1969 when it was nationalised. Since inception in 1895, PNB has always been a "People`s bank" serving millions of people throughout the country and also had the proud distinction of serving great national leaders like Sarvshri Jawahar Lal Nehru, Gobind Ballabh Pant, Lal Bahadur Shastri, Rafi Ahmed Kidwai, Smt. Indira Gandhi etc. amongst other who banked with us.

Punjab Keshari Lala Lajpat Rai (Saluting The Spirit Of Our Founding Father) The Life And Times Of Lala Lajpat Rai

There are few leaders of the pre-indendence era who,after having plunged themselves into the political struggle, continued to take an active interest in social, cultural and educational work. Lala Lajpat Rai was one of such leaders. Born on 28th January, 1865 at a small village, Dhudike in the Ferozepur district of Punjab, he belonged to the Agarwal Baniya caste and it was perhaps because of this, in addition to taking part in social and political life of the country, he took keen interest in industrial and financial matter also. His father was a teacher of Persian and Urdu in a government school. Having passed the final examination in Law from Punjab University, he started his practice in1883, when he was barely 18 years old. Endowed with a rich legacy of moral and intellectual background, Lala Lajpat Rai had benefit of education in the practical rationalism of western science combined with the religious purity and moral elevation of Eastern literature that put on him the hallmark of true culture. While sympathizing with and aiding every movement made for progress, Lala Lajpat Rai identified himself very closely with Arya Samaj, in which he found ample scope for the exercise of his patriotism, philanthropy and religious zeal. Having qualified as a pleader, Lala Lajpat Rai started practice at Hissar and soon became a leading lawyer of the district. He organized the Arya Samaj there and put it on proper lines. In 1892, he transferred his practice to the wider field at Lahore.Education, both secular and religious, was in Lala Lajpat Rai’s view an important factor in national development. He took part in the foundation of the D.A.V. College at Lahore. Lalaji And Politics. Lala Lajpat Rai always felt drawn towards politics. It was in 1888 that he joined the Indian National Congress when it met at Allahabad under the presidency of Mr. G. Yule. In 1905, the Indian National Congress Committee having recognized in him an austere, sincere and selfless devoted worker selected him as one of its delegates to place before the British, the political grievances of the Indian people. He met the expenses of his trip from his own pocket. He along with Gokhale carried on the political campaign in various parts of England and brought home to the mind of the British, the evils of an unsympathetic and bureaucratic government under which India

was labouring and pleaded in eloquent language, adding facts and figures in supporting their contention, cause of the half starving and half dying people of India. Lala Lajpat Rai created an impression on the English Populace. After his return from England, he was busy devising and organizing ways and means for political advancement and industrial emancipation of the country. The movement of “Swadeshi” was in the offing and he put his heart and soul into it. He preached the message of Swadeshi to the people of Punjab and made it very popular. This naturally enraged the bureaucracy and he came to be regarded as a revolutionary by the Britishers and the Anglo-Indian press. He was openly dubbed as a Revolutionary and an instigator of the armed forces. The Jalianwala Bagh tragedy and the Government`s denial to censure the conduct of its officers made him a complete non cooperator. He lost his faith in the British and threw himself whole heartedly into the non-cooperation movement.In 1925, he joined the Swaraj Party and became its deputy leader. He took active part in the deliberations of the debates of the Assembly. It was he, who moved the resolution for the Boycott of the Simon Commission in the Assembly. It was while leading the boycott procession at Lahore on the 30th October, 1928 that he received lathi blows on his chest which ultimately brought about his death on the 17th November, 1928. Lala Lajpat Rai And PNB Lalaji was keenly concerned with the fact that though Indian capital was being used to run English Banks and companies, the profits went entirely to the British, while Indians had to contend themselves with a small interest on their capital. He echoed this sentiment in one of his writing while concurring with Rai Mul Raj of Arya Samaj who had long cherished the idea that Indians should have a National Bank of their own. At the instance of Rai Mul Raj, Lala Lajpat Rai sent a circular to selected friends insisting on an Indian joint stock Bank as the first step in constructive Swadeshi and the response was satisfactory After filing and registering the memorandum and Articles of Association on 19 May, 1894, the bank was incorporated under Act VI of the 1882 Indian Companies Act. The prospectus of the bank was published in the Tribune, and the Urdu Akhbar-e-Am and Paisa Akhbar. On 23rd May, 1894, the founders met at the Lahore residence of Sh. Dyal Singh Majithia, the first Chairman of PNB, and resolved to go ahead with the scheme. They decided to hire a house in the famous Anarkali Bazar of Lahore opposite the post office and near well known stores of Rama Brothers.On 12th April 1895, the Bank opened for business, a day before the great Punjab festival of Baishakhi. The essence of the Bank’s culture was clear at this first meeting itself. The fourteen original shareholders and seven directors took only a modest number of shares; the control of the Bank was to lie with the large, dispersed shareholders, a purely professional approach that was as uncommon then as it is today.

INTRODUCTION Background Study :The Internet banking is changing the banking industry and is having the major effects on banking relationships. Even the Morgan Stanley Dean Witter Internet research emphasized that Web is more important for retail financial services than for many other industries. Internet banking involves use of Internet for delivery of banking products & services. It falls into four main categories, from Level 1 - minimum functionality sites that offer only access to deposit account data to Level 4 sites - highly sophisticated offerings enabling integrated sales of additional products and access to other financial services - such as investment and insurance. In other words a successful Internet Banking solution offers – • Exceptional rates on Savings, CDs, and IRAs • Checking with no monthly fee, free bill payment and rebates on ATM surcharges • Credit cards with low rates • Easy online applications for all accounts, including personal loans and mortgages • 24 hour account access • Quality customer service with personal attention. Drivers Of Change : Advantages previously held by large financial institutions have shrunk considerably. The Internet has leveled the playing field and afforded open access to customers in the global market place. Internet Banking is a cost effective delivery channel for financial institutions. Consumers are embracing the many benefits of Internet Banking. Access to one's accounts at anytime and from any location via the World Wide Web is a convenience unknown a short time ago. Thus, a bank's Internet presence transforms from 'brouchreware' status to 'Internet banking' status once the bank goes through a technology integration effort to enable the customer to access information about his or her specific account relationship. The six primary drivers of Internet Banking includes, in order of primacy are : • Improve customer access • Facilitate the offering of more services • Increase customer loyalty • Attract new customers • Provide services offered by competitors • Reduce customer attrition.

•Indian Banks on Web : The banking industry in India is facing unprecedented competition from nontraditional banking institutions, which now offer banking and financial services over the Internet. The deregulation of the banking industry coupled with the emergence of new technologies, are enabling new competitors to enter the financial services market quickly and efficiently. Indian banks are going for the retail banking in a big way. However , much is still to be achieved. This study which was conducted by students of IIML shows some interesting facts : Throughout the country, the Internet Banking is in the nascent stage of development (only 50 banks are offering varied kind of Internet banking services). In this general, these Internet sites offer only the most basic services. 55% are so called 'entry level' sites, offering little more than company information and basic marketing materials. Only 8% offer 'advanced transactions' such as online funds transfer ,transactions & cash management services. • Foreign & Private Banks are much advanced in terms of the number of sites & their level of development. *Emerging Challenges : Information technology analyst firm, the Meta Group, recently reported that "financial institutions who don't offer home banking by the year 2000 will become marginalized." By the year of 2002, a large sophisticated and highly competitive Internet Banking Market will develop which will be driven by • Demand side pressure due to increasing access to low cost electronic services. • Emergence of Open standards for banking functionality. • Growing customer awareness and need of transparency. • Global players in the fray. • Close integration of bank services with web based E-commerce or even disintermediation of services through direct electronic payments (E-Cash) • More convenient international transactions due to the fact that the Internet along with general deregulation trends eliminates geographic boundaries. *Main Concerns In Internet Banking : In a survey conducted by the Online Banking Association , member institutions rated security as the most important issue of Online banking. There is a dual requirement to protect customer's privacy and protect against fraud. Banking Securely : Online banking via the World Wide Web provides an overview of Internet commerce and how one company secure banking for its financial institution clients and their customers. Some basic information on the transmission of confidential data is presented in Security and Encryption on the Web. PC Magazine Online also offer a primer : How Encryption Works. A multilayered security architecture comprising

firewalls , filtering routers, encryption and digital certification ensure that your account information is protected from unauthorised access : • Firewalls and filtering routers ensure that only the legitimate Internet users are allowed to access the system. • Encryption techniques used by the bank (including the sophisticated public key encryption) would ensure that privacy of data flowing between the browser and the Infinity system is protected. • Digital certification procedures provide the assurance that the data you receive is from the Infinity system. *Current Scenario : The Indian has finally worked up to the competitive dynamics of new Indian market and is addressing the relevant issues take on the multifarious challenges of globalization. Banks that employ IT solutions are perceived to be futuristic and proactive players capable of meeting the multifarious requirements of large customer base. Private banks have been fast on the uptake and are reorienting their strategies using the Internet as a medium. The India banking has come from a long from being a sleepy business institution to a highly proactive and dynamic entity this transformation has been largely brought by the large doses of liberalization and economic reforms that allowed exploring new business opportunities rather than generating revenues from conventional streams. The Indian industry has confidently hit the growth trial that pick in activity is best reflected in the banking sector which after all is as candid a mirror of a country's economy as you could ever find. Most of the Indian Financial intermediaries have been keeping pace with the deepening market economy, riding the opportunity that come along with reforms even as they brace themselves for increased competition both foreign and private by strengthening prudential norms and leveraging technology to ensure that growth engine hums smoothly along the essential function of a bank is to provide services related to the storing value of value and the extending credit. The evolution of banking dates back to the earliest writing and continues in the present where a bank is a financial institution that provides banking and other financial services. Currently the term bank is generally understood an institution that holds a banking license. Banking licenses are granted by financial supervision authorities and provide rights to conduct the most fundamental banking services such as accepting deposits and making loans. There are also financial institutions that provide certain banking services without meeting the legal definition of a bank ,a so called non-bank. Banks are a subset of the financial services industry. The word bank is derived from the italian banca, which is derived from German and means bench. The terms bankrupt and "broke" are similarly derived from banca rotta, which refers to an out of business bank, having its bench physically broken. Money lenders in Nothern Italy originally did business in open areas , or big rooms, with each lender working from his own bench or table. Typically, a bank generates profits from

transaction fees on financial services or the interest spread on resources it holds in trust for clients while paying theme interest on the asset. Services typically offered by the banks - Although the type of services offered by a bank depends upon the type of bank and the country, services provided usually include : • Directly take deposits from the general public and issue checking and saving accounts. • Lend out money to companies and individuals (see money lender) • Cash checks. • Facilitate money transactions such as wire transfers and cashier's checks. • Issue credit cards, ATM, and debit cards and online banking. • Storage of valuables , particularly in a safe deposit box. •Technology In Banking : Technology will bring fundamental shift in functioning of banks. It would not only help them bring improvements in their internal functioning but also enable them to provide better customer service. Technology will break all boundaries and encourage cross border banking business. Banks would have to undertake extensive Business Process Re-Engineering and tackle issues like a) how best to deliver products and services to customers. b) designing an appropriate organizational model to fully capture the benefits of technology and business process changes brought about. c) how to exploit technology for deriving economies of scale and how to create cost efficiencies, and d) how to create a customer - centric operation model. • Entry of ATMs has changed the profile of front offices in bank branches. Customers no longer need to visit branches for their day to day banking transactions like cash deposits, withdrawals ,cheque collection , balance enquiry etc. E- banking and Internet banking have opened new avenues in "convenience banking". • Technology solutions would make flow of information much faster, more accurate and enable quicker analysis of data received. This would make the decision making process faster and more efficient. For the Banks, this would also enable development of appraisal and monitoring tools which would make credit management much more effective. The result would be a definite reduction in transaction costs, the benefits of which would be shared between banks and customers. • One area where the banking system can reduce the investment costs in technology applications is by sharing of facilities. We are already seeing banks coming together to share ATM Networks. Similarly, in the coming years , we expect to see banks and FIs coming together to share facilities in the area of payment and settlement, back office processing, data warehousing , etc. While dealing with technology , banks will have to deal with attendant operational risks. This would be a critical area the Bank management will have to deal with in future.

• Payment Settlement system is the backbone of any financial market place. The present Payment and Settlement systems such as Structured Financial Messaging System( SFMS) , Centralised Funds Management System(CFMS) , Centralised Funds Transfer System (CFTS) and Real Time Gross Settlement System( RTGS) will undergo further fine- tuning to meet international standards. Needless to add, necessary security checks and controls will have to be in place. In this regard, Institutions such as IDRBT will have a greater role to play.

Industry Profile : Without a sound and effective banking system in India it cannot have a healthy economy. The banking system of India should not only be hassle free but it should be able to meet new challenges posed by the technology and any other external and internal factors. For the past three decades India's banking system has several outstanding achievements to its credit. The most striking is its extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact , Indian banking system has reached even to the remote corners of the country. This is one of the main reasons of India's growth process. The government regular policy for Indian banks since 1969 has paid rich dividends with the nationalization of 14 major private banks of India. Not a long ago, an account holder had to wait for hours at the bank countries for getting a draft or for withdrawing his own money. Today,, he has a choice. Gone are days when most efficient bank transferred money from one branch to other in two days. Now it is simple as instant messaging or dial a pizza. Money have become the order of the day. The first bank in India , though conservative, was established in 1786. From 1786 till today, the journey of Indian Banking System can be segregated into three distinct phases. They are as mentioned below : • Early phase from 1786 to 1969 of Indian Banks. • Nationalisation of Indian Banks and up to 1991 prior to Indian banking sector Reforms. • New phase of Indian Banking System with the advent of Indian Financial & Banking Sector Reforms after 1991. Phase 1 The General Bank of India was set up in the year 1786. Next came Bank of Hindustan and Bengal Bank.. The East India Company established Bank of Bengal(1809) , Bank of Bombay(1840) and Bank of Madras( 1843) as independent units and called it Presidency Banks. These three banks were amalgamated in 1920 and Imperial Bank of India was established which started as private shareholders banks, mostly European shareholders. In 1865 Punjab national bank was established and first time exclusively by Indians , Punjab , National Bank Ltd. was set up in 1894 with headquarters at Lahore. Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara Bank, Indian Bank and Bank of Mysore were set up. Reserve Bank of India came in 1935. During the first phase the growth was very slow and banks also experienced periodic failures between 1913 and 1948. There were approximately 1100 banks, mostly small. To streamline the functioning and activities of commercial banks, the Government of India came up with The Banking Companies Act,1949 which was later changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No.23 of 1965). Reserve Bank of India was vested with extensive powers for the supervision of banking in India as the Central Banking Authority. Government took major steps in this Indian Banking Sector Reform after independence. In 1955 , it nationalised

Imperial bank of India with extensive banking facilities on a large scale especially in rural and semi urban area. It formed State Bank of India to act as the principal agent of RBI and to handle banking transactions of the Union and State Governments all over the country. Seven banks forming subsidiary of State Bank of India was nationalised in 1960 on 19th July,1969. 14 major commercial banks in the country was nationalised. This step brought 80% of the banking segment in India under Government ownership. This phase has introduced many more products and facilities in the banking sector in its reforms measure, In 1991, a committee was set up by his name which worked for the liberalisation of banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to customers. Phone banking and net banking is introduced. The entire system became more convenient and swift. Time is given more importance than money. The financial system of India has shown a great deal of resilience. It is sheltered from any crisis triggered by any external macroeconomics shock as other East Asian Countries suffered. This is all due to a flexible exchange rate regime, the foreign reserves are high, the capital account is not yet fully convertible, and banks and their customers have limited foreign exchange exposure. •Problem Identified :Even though the technology updation has been adopted in Internet banking, still the customers are unaware about the updation of technology and the reason for the technology updation. Some of the customers are not using the branch networks, and ATM facilities. Only educated people are aware about the internet banking facilities and the procedures to access their account online. Even among the educated people, some of them are still feeling insecure about performing the transactions through net banking facilities provided by the banks. The bank doesn't take any actions to make aware their customers to use the internet banking facility or to increase the satisfaction level among their customers.

Need Of Study :This study analyses about the need for internet banking facility offered bybanks to their customers. The specific online facilities include fund transfer, online bill payment, balance enquiry and the most of the other activities related to the customer's bank account. These were implemented to overcome the problems associated with traditional banking system, which includes time delay in transactions, need of physical presence of customers, and more paper work for bankers and so on. This study has been mainly carried out to intimate the changes, updations in internet banking facility. This study makes contributions by showing how the current internet banking facilities contribute in increasing the efficiency of the banking operations and also focuses on the acceptance level among the Customers for Internet banking. Hence, it is necessary to conduct a study to know whether the implementation of Internet Banking has served the purpose or not.

Objectives Of Study :1]Primary Objectives: • To study the effectiveness of the Internet Banking In India. 2]Secondary Objectives: • To study on current internet banking facilities provided by banks. • To study the usage level of the Internet banking facilities by customers. • To study the improvement of efficiency of banking operations obtained by internet banking. • To notify the changes needed from customer view in existing internet banking facilities.

Review Of Literature:Online banking is the latest in the series of technological wonders of the recent past. ATMs, Tele Banking , Internet Banking , Credit Cards and Debit Cards have emerged as effective delivery channels for traditional banking products. Internet or Electronic or online baking is the newest delivery channel to be offered by retail banks in many developed countries, and there is a wide agreement that this channel will have a significant impact on the market. Banks know that the internet opens up new horizons for them and moves them from local to global frontiers. Online banking refers to systems that enable bank customers to get access to their accounts and general information on bank products and services through the use of bank's websites, without the intervention or inconvenience of sending letters, faxes , original signatures and telephone confirmations. In its simplest form, electronic banking may mean the provision of information about the bank and its products via a page on the internet. It is the types of services through which bank customers can request information and carry out most retail banking services such as balance reporting, inter-account transfers, bill payment, etc via a telecommunication network without leaving their homes or organizations. In essence, it is an electronic consumer interface and an alternative channel of distributions. Online banking has been regarded as the most important way to reduce cost and maintain or enhance services for consumers. It provides universal connection from any location worldwide and its universally accessible from any internet linked computer. It is a process of innovation whereby customers handle their own banking transactions without visiting bank tellers. E- Banking In India Information technology is considered as the key driver for the changes taking place around the world. According to Heikki, the transformation from the traditional banking to e-banking has been a 'leap' change. The evolution of e-banking started from the use of Automatic Teller machines( ATMs) and telephone banking (tele-banking), direct bill payment, electronic fund transfer and the revolutionary online banking. The future of electronic banking would be more interactive i.e TV banking . Finland is the first country in the world to have taken a lead in e- banking. In India , ICICI Bank initiated e-banking services during 1997 under the brand name 'Infinity'. It has been forecasted that among all categories, online baking is the future of electronic financial transactions. The rise in e-commerce and internet in enhancing online security transformation and sensitive information has been the core reason for the penetration of online banking in everyday life. The shift towards the involvement of the customers in the financial service with the help of technology ,especially internet, has helped in reducing costs of financial institutions as well as clients / customers who use the service at anytime and from virtually anywhere with access to an internet connection.

Company Profile In Online Banking Where punjab national bank was?

• In early 1990’s more than 7000 branches were using traditional manual procedures. • These manual procedures were inherited from the Imperial Bank. • Traditional procedures were evolved over decades • Very few changes were brought in those procedures as per the need of time. • In that time, mainframe or mini computers were used for MIS, RECONCILLATION & FUND SETTLEMENT PROCESS, or we can say that for backhand operations purpose. Changes brought in Information Technology by punjab national bank :• In the next decade internet facility was provided for individuals • All punjab national bank branches were connected and ATM’S were launch • 2001 - KMPG appointed consultant for preparing IT Plan for the Bank. • Later on Core banking proposed by the IT consultancy company. • 2002 – All branches computerized but on decentralized systems, there the initiative of core banking took place • 2008- more than 6500 branches (95% of business) on Core Banking Solution (CBS) • Internet Banking facility for Corporate customers were also launched in early 2008 • More Interfaces developed with e-Commerce & other sites through alternate channels like ATM & Online Banking • All Foreign Offices were brought on Centralized Solution • Large network is playing the role of backbone for connectivity across the country • Multiple Service Providers are providing the links – BSNL, MTNL, Reliance, Tata & reliance which are making the system errorless and provide high speed. • Multiple Technologies to support the networking infrastructure – Leased lines, Dialup, CDMA & VSAT CBS - Core Banking System Components ELITEX-2008 8 CBS - Core Banking System Components Datacenter Network Administrators CoreBanking Application OS, Database Internet-Banking ATM Desktops, Branch Servers WAN, Internet Branches Application Developers System AdministratorsBranch User/Admins Alternative Channels Online punjab national bank punjab national bank is one of India’s largest bank with a branch network of over 11000 branches and 6 associate banks located even in the remotest parts of India. Allahabad Bank offers a wide range of banking products and services to corporate and retail customers. Online punjab national bank is the Internet banking portal for . The portal provides anywhere, anytime, online access to accounts for Retail and Corporate customers. The application is developed using the latest cutting edge technology and tools. The infrastructure supports unified, secure access to banking services for accounts in over 11,000 branches across India.

Services :1.Retail Banking:The Retail banking application is an integration of several functional areas, and enables customers to: Issue Demand Drafts online Transfer funds to own and third party accounts Credit beneficiary accounts using the VISA Money Transfer, RTGS/NEFT feature Generate account statements Setup Standing Instructions Configure profile settings Use eTax for online tax payment Use ePay for automatic bill payments Interface with merchants for railway and airline reservations Avail DEMAT and IPO services 2.Corporate Banking:The Online corporate banking application provides features to administer and manage corporate accounts online. The corporate module provides roles such as Regulator, Admin, Uploader, Transaction Maker, Authorizer, and Auditor. These roles have access to the following functions: Manage users, define rights and transaction rules on corporate accounts Access accounts in several branches with a single sign-on mechanism Upload files to make bulk transactions to third parties, supplier, vendor and tax collection authorities. Use online transactional features such as fund transfer to own accounts, third party payments, and draft issues Make bill payments over the Internet. Authorize, modify, reschedule and cancel transactions, based on rights assigned to the user Generate account statement Enquire on transaction details or current balance Value added services: Tax payments to central and state governments through site to site integration. Supply Chain Finance( e-VFS- Electronic Vendor Finance Scheme) Direct Debit Facility

E Collection Facilities for: Core Banking Transactions Internet Bank transactions for incoming RTGS/NEFT Transactions Internet banking transactions for punjab national Bank customers and associate banks Debit facility where suppliers can directly debit their customer’s account through internet banking Products And Services:• E-Ticketing • E-Tax • Bill Payment • RTGS/NEFT • E-Payment • Fund Transfer • Third Party Transfer • Demand Draft • Cheque Book Request • Account Opening Request • Account Statement • Transaction Enquiry • Demat Account Statement • Donation

SWOC Analysis ( Strength, Weaknesses , Opportunities , Challenges):Strengths:• Greater reach to customers . • Quicker time to market . • Ability to introduce new products and services quickly and successfully. • Ability to understand its customers’ needs. • Customers are given access to information easily across any location. • Greater customer loyalty . • Easy online application for all accounts, including personal loans and mortgage. • 24 hours account access. • Quality customer service with personal attention.

Weaknesses:• Lack of awareness among the existing customers regarding Online banking. • Obsolesce of technology take place very soon specially in terms of security on internet. • Procedure for applying for ID and password for using services related to Online banking takes time. • Lack of knowledge is found regarding in Online banking in employees of punjab national Bank • Implementation of newer technology is little bit complicated • Employees needs training to obtain knowledge regarding Internet-banking.

Opportunities:• Approximately 95% of customers are not using internet banking. • Core competency can be achieved in terms of banking if focus is made on awareness of internet banking, can become 1st virtual bank of India. • Concentration of various services should be made using internet banking.

Challenges:• Maintaining Business Edge over competitors in the context of sameness in IT infrastructure • Multiple vendor support is necessary for working of highly complex technology • Maintaining secured IT infrastructure for business operations and Alternative must be there in case of failure of system.

Data Analysis:This includes designing questionnaire for collection of data through collection of data from target respondents, processing and analyzing the data and arriving at conclusions. The target of 150 respondents from the following group has been taken for the study. The study is based on the sample drawn from the customers of punjab national bank providing the internet banking facility.

Research and methodology:The area of research is Punjab National Bank that have adopted Online Banking. Research is about to be conducted to the bank customers and staffs with the sample size of 150.

CONCLUSION AND RECOMMENDATIONS Analysis shows that even though the Online Banking facility is having many advantages, it is not utilized by many people. It shows that the younger generation people are more likely to use the Internet banking facilities when compared to the middle age and old age people. It is due to the unawareness of the customers towards the internet banking facility. Also, the people are finding difficulties in using the Internet banking websites which had created an aversion in them towards net banking. This can be overcome if the banks conduct sessions on the various features provided in their Online banking web sites. Even the younger generation people are feeling insecure to use the online transaction facilities provided by the banks. The internet banking technology should be made more secure so as it to eliminate the constraint among the customers.

Why Did Choose Internet Banking?? Internet banking is becoming more and more popular among the masses. To provide more Quality Information on Internet Banking. Make the concept and procedure more familiar. To warn against its negative effects. Internet banking means any user with a personal computer and a browser can get connected to his bank’s website to perform any of the virtual banking functions: Balance enquiry. Transfer of funds. Online payment of bills. Accrued interest, fees and taxes. Transaction details of each account. Accounts, credit card & home loan balances. Transfer funds to third party accounts you nominate. Open a deposit right from the terminal you are sitting at. The concept of Internet banking has beensimultaneously evolving with the development ofthe World Wide Web. Programmers working on banking data bases came up with ideas for onlinebanking transactions, sometime during the 1980s. In 1983, the Nottingham BuildingSociety, commonly abbreviated and referred to asthe NBS, launched the first Internet banking servicein United Kingdom. This service formed the basis formost of the Internet banking facilities thatfollowed. The facility introduced by NottinghamBuilding Society is said to have been derived from asystem known as Prestel that is deployed by thepostal service department of United Kingdom. *History In India •Punjab National Bank was the first bank to initiate the Internet BankingRevolution in India as early as 1997 under the brand nameInfinity. • punjab national bank kicked off online banking way back in 1996. Buteven as a whole, 1996 to 1998 marked the adoptionphase, while usage increased only in 1999due to lower ISPonline charges, increased PC Penetration and a TechFriendly atmosphere. *How to access Internet Banking? Before you can access your account online, you’llneed to register with your bank for Internetbanking. Your bank will give you a registration numberor login ID. You’ll also need a password (IPIN).Your Internet password is different from the PINyou use with your debit card.

Once your bank has approved yourregistration, you’re able to access your accountsonline. STEP 1: Make sure your computer is connectedto the Internet. STEP 2: Go to your bank’s website. For security reasons, don’t click on a link to your bank sent to you in an email – emails with links to fake websites are a classic ploy of criminals trying to steal your identity. STEP 3:Once you’re on your bank’s website you’ll see a button or othericon labelled ‘Log on to Internet banking’ or something similar(the terminology varies from bank to bank) Click on this icon It will take you to a login page STEP 4: Login to your Internet account It generally requires you to enter your registration number or login ID You will also have to enter your password – either by typing it in, or by clicking on letters and numbers onscreen STEP 5: Some banks have a two stage authentication process ― an additional security measure to protect customers’ accounts and personal data. If a two-stage process, you’ll then have to enter another code. The code may be generated by a security token the bank gives you when you register for Internet banking, or it could be contained in an SMS message the bank sends to your mobile phone STEP 6: If you’ve entered the correct information at all these stages, you’ll gain access to your accounts and be able to begin your Internet banking STEP 7: Once you’ve got online access to your accounts you’ll see the different types of transactions that you can perform. Usually on the left side of the screen there will be a list of functions. Click on a function to open it. For example, if you want to transfer funds, click on the button or icon labelled ‘Transfers’ or something similar. You’ll need to complete the required data. Remember – make sure that you have the right BSB (Bank State Branch ) code and account number for the beneficiary of the transfer, as this is the information that the bank will use to process the transfer. STEP 8: Once you’ve finished your Internet banking, be sure to log out from your account. Most banks also have in place a ‘time-out’ feature, which means that if you’re inactive for a certain period in your Internet banking session, you’ll automatically be logged out.

Merits/Demerits of Internet Banking:*Merits:

Convienience

Effectivness

Efficiency

Ubiquity

Transaction Speed

Convenience: Unlike your corner bank, online banking sites neverclose; theyre available 24 hours a day, seven days a week, and theyre only a mouse click away. Ubiquity: If youre out of state or even out of the country when amoney problem arises, you can log on instantly to your online bank and take care of business, 24/7. Transaction speed: Online bank sites generally execute andconfirm transactions at or quicker than ATM processing speeds. Efficiency: You can access and manage all of your bank accounts, including IRAs, CDs, even securities, from one secure site. Effectiveness: Many online banking sites now offer sophisticated tools, including account aggregation, stock quotes, rate alerts and portfoliomanaging programs to help you manage all of yourassets more effectively. Most are also compatible with money managing programs such as Quicken and Microsoft Money.

*Demerits:

Start-up May Be Take Time

Learning Curve

Bank Site Changes

The Trust Thing

Start-up may take time: In order to register for your banks onlineprogram, you will probably have to provide ID and sign a form at abank branch. If you and your spouse wish to view and manage yourassets together online, one of you may have to sign a durable powerof attorney before the bank will display all of your holdings together. Learning curve: Banking sites can be difficult to navigate at first.Plan to invest some time and/or read the tutorials in order to becomecomfortable in your virtual lobby. Bank site changes: Even the largest banks periodically upgradetheir online programs, adding new features in unfamiliar places. Insome cases, you may have to re-enter account information. The trust thing: For many people, the biggest hurdle to onlinebanking is learning to trust it. Did my transaction go through? Did Ipush the transfer button once or twice? Best bet: always print thetransaction receipt and keep it with your bank records until it showsup on your personal site and/or your bank statement.

Services provided under internet banking:Online Bill Payment Personal Home Page Ticket Booking Prepaid Mobile Recharge Market Watch Investment Services Online Applications Personal updates Increasing number of Fake emails fraudulent bank purporting to be sent websites. from banks.Use of Trojan Horse Hackers who hack intoprograms to capture personal bank user IDs and accounts and steal passwords. money. Nowadays a large number of fraudulent websites are coming up which aim to trick persons into disclosing their sensitive personal information. Fake EmailsThis method is also known as Phishing. In the field of computersecurity, phishing is the criminally fraudulent process of attempting toacquire sensitive information such as usernames, passwords and creditcard details by masquerading as a trustworthy entity in an electroniccommunication Emails are send by Fraudulent bank. Customer’s verify the personal information. These Emails Guide customers and make them enter the fraud links. Thereby Disclosing the customer’s ATM card numbers and their passwords Here is an example of this bankwarning its customers of the fakeemails they can receive: Hackers Pharming is a hackers attack aiming to redirect a websites traffic to another, bogus website. In recent years both pharming and phishing have been used for online identity theft information.Pharming has become of major concern to businesses hosting ecommerce and online banking websites. Sophisticated measures known as anti-pharming are required to protect against this serious threat. Antivirus software and spyware removal software cannot protect against pharming.

Conclusion:Internet banking is changing the banking industry and is having the major effects on banking relationships. The net banking, thus, "now is more of a norm rather than an exception in many developed countries" due to the fact that it is the economical way of providing banking services. Banking is now no longer confined to the traditional brick and mortar branches, where one has to be at the branch in person, to withdraw cash or deposit a cheque or request a statement of accounts. Providing internet banking is increasingly becoming a need to have than a nice to have services.

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s ranked #717 in the Forbes Global 2000 in May 2013. Punjab National Bank was ranked #26 in the Fortune India 500 ranking of 2011. PNB was awarded the 'Best Public Sector Bank' by CNBC TV18 in 2012. The bank was recognised as the 'most socially responsive bank' by Businessworld and PwC in 2012. In 2011, it received Golden Peacock Award for "Excellence in Corporate Social Responsibility" and "National Training Award".

Timeline In 1900 PNB established its first branch outside Lahore in India. Branches in Karachi and Peshawar followed. The next major event occurred in 1940 when PNB absorbed Bhagwan (or Bhugwan) Dass Bank, which had its head office in Dehra Dun. At the Partition of India and the commencement of Pakistani independence, PNB lost its premises in Lahore, but continued to operate in Pakistan. Partition forced PNB to close 92 offices in West Pakistan, one-third of its total number of branches, and which held 40% of the total deposits. PNB still maintained a few caretaker branches. On 31 March 1947, even before Partition, PNB had decided to leave Lahore and transfer its registered office to India; it received permission from the Lahore High Court on 20 June 1947, at which time it established a new head office at Under Hill Road, Civil Lines in New Delhi. Lala Yodh Raj was the Chairman of the Bank. In 1951, PNB acquired the 39 branches of Bharat Bank (est. 1942). Bharat Bank became Bharat Nidhi Ltd. In 1960, PNB again shifted its head office, this time from Calcutta to Delhi. In 1961, PNB acquired Universal Bank of India, which Ramakrishna Jain had established in 1938 in Dalmianagar, Bihar. PNB also amalgamated Indo Commercial Bank (est. 1932 by S. N. N. Sankaralinga Iyer) in a rescue. In 1963, The Burmese revolutionary government nationalized PNB's branch in Rangoon (Yangon). This became People's Bank No. 7.[9]After the Indo-Pak war, in September 1965 the government of Pakistan seized all the offices in Pakistan of Indian banks. PNB also had one or more branches in East Pakistan (Bangladesh). The Government of India (GOI) nationalized PNB and 13 other major commercial banks, on 19 July 1969. In 1976 or 1978, PNB opened a branch in London. some ten years later, in 1986, the Reserve Bank of India required PNB to transfer its London branch to State Bank of India after the branch was involved in a fraud scandal. That same year, 1986, PNB acquired Hindustan Commercial Bank (est. 1943) in a rescue. The acquisition added Hindustan's 142 branches to PNB's network. In 1993, PNB acquired New Bank of India, which the GOI had nationalized in 1980. In 1998 PNB set up a representative office in Almaty, Kazakhstan. In 2003 PNB took over Nedungadi Bank, the oldest private sector bank in Kerala. At the time of the merger with PNB, Nedungadi Bank's shares had zero value, with the result that its shareholders received no payment for their shares. PNB also opened a representative office in London. In 2004, PNB established a branch in Kabul, Afghanistan, a representative office in Shanghai, and another in Dubai. PNB also established an alliance with Everest Bank Limited in Nepal that permits migrants to transfer funds easily between India and Everest Bank's 12 branches in Nepal. Currently, PNB owns 20% of Everest Bank. Two years later, PNB established PNBIL – Punjab National Bank (International) – in the UK, with two offices, one in London,

and one in Southall. Since then it has opened more branches, this time in Leicester, Birmingham, Ilford, Wembley, and Wolverhampton. PNB also opened a branch in Hong Kong. In January 2009, PNB established a representative office in Oslo, Norway. PNB hopes to upgrade this to a branch in due course. In January 2010, PNB established a subsidiary in Bhutan. PNB owns 51% of Druk PNB Bank, which has branches in Thimpu, Phuentsholing, and Wangdue. Local investors own the remaining shares. Then on 1 May, PNB opened its branch in Dubai's financial center. PNB purchased a small minority stake in Kazakhstan-based JSC Danabank established on 20 October 1992 in Pavlodar. Within the year PNB increased its ownership till 84% of what has become JSC (SB) PNB, with its share currently decreased to 49%. The associate in Kazakhstan now called JSC Tengri Bank has branches in Almaty, Astana, Karaganda, Pavlodar and Shymkent. September 2011: PNB opened a representative office in Sydney, Australia. December 2012: PNB signed an agreement with US based life Insurance company Metlife to acquire a 30% stake in MetLife's Indian affiliate MetLife India Limited. The company would be renamed PNB MetLife India Limited and PNB would sell MetLife's products in its branches.[[11][6][11]| assets = ₹6,435 billion (US$90 billion) (2015)[12]

Features:Punjab National Bank (PNB) was incorporated under Act VI of the Indian Companies Act and began its operations just a day before Baisakhi, i.e. on 12th April 1895 from Lahore. It started its operations with a working capital of Rs 20,000 and Rs 2 lakhs of authorized capital. Creation and establishment of this bank is attributed to visionaries like Mr. Jessawala, Lala Lajpat Rai, Lala Harikrishan Lal, Babu Kali Prasono Roy and Sardar Dyal Singh Majithia. The main objective in formation of PNB was to provide the country with a true national bank which would dedicate itself to working towards the economic interest of the country and play a pivotal role in ensuring the country’s growth and prosperity. Lala Lajpat Rai played a key role in forming the establishment of PNB in its formative years.

Credit Cards:Introduction of credit cards have given a boost to cashless economy and resulted in encouraging individuals and businessmen towards use of cashless transactions. Punjab National Bank has three credit cards which are affiliated to VISA, these are, PNB Global Gold Credit Card, PNB Global Classic Credit Card and PNB Global Platinum Credit Card. All the cards offer attractive perks and reward points against expenses which are charged to the card or transactions carried out using the card. In case of theft or loss of credit card, you will have to immediately report to the toll free customer care number which is available 24X7.

Overview:Founded in 1894, Punjab National Bank (PNB) is an Indian multinational banking and financial services company headquartered in New Delhi, India. It is one of the oldest banks catering to 80 million customers with over 6,968 branches and more than 9,935 ATMs across the country. PNB has also extended its operations worldwide by establishing branches and representative offices in Hong Kong, Kabul, Dubai, Almaty, Oslo, Shanghai and Sydney. It offers a host of banking products and financial services which include private equity, consumer banking, private banking, corporate banking, mortgage loans, wealth management, insurance and credit cards. PNB is considered the third largest public sector bank in India with respect to assets and ranked among the top 250 largest banks across the world. It has been awarded as ‘Best Public sector bank’ by CNBC TV and recognised as ‘Most Socially Responsive Bank’ by Business-world and PwC for showing consistent growth in the banking sector. It also holds major rankings such as Fortune India 500 and Forbes Global 2000.

Punjab National Bank Debit cards:In order to provide value added services to its customers, PNB offers a range of debit cards which are designed according to their needs. These debit cards are tailor-made to provide the convenience of cashless transactions and you are not charged on cash withdrawals from PNB or any other bank ATMs.

Why choose Punjab National Bank debit card     

Get enhanced cash withdrawal and transaction limits Enjoy cashless shopping at retail and online stores worldwide Get add on facility on selected PNB debit cards Get safe and secure transactions because of 3D Secure Password protection on your PNB debit cards PNB debit cards can also be used for paying utility bills, dining, entertainment, booking train or bus tickets and much more.

Types of PNB Debit Cards:PNB offers its customers with a wide range of debit card options that are in line with the requirements of various customer groups. 1)Classic Debit Card (Magstripe):The Punjab National Bank Classic debit is the perfect option for those seeking a basic debit card which is linked to their account. The following are its key features: 

Classic Debit Cards are chip and PIN based debit cards which are specially designed for Punjab National Bank savings account holders.

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You can either opt for a personalised debit card which has your name on it or a non-personalised debit card which does not has your name on it. Get higher cash withdrawal and purchase limit daily. Maximum daily cash withdrawal limit is Rs 25,000 per day at PNB ATMs, while the transaction limit is Rs. 15,000 per day at other bank ATMs. The maximum daily transaction limit is Rs. 60,000 at PoS terminals and e-commerce websites. You can also transfer funds to your friends and family from one PNB account to another using your PNB debit card.

2)Platinum Debit Card (Magstripe):PNB offers its platinum debit card for customers who desire more when shopping in a cashless manner. The following are some key features of this card:   

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Platinum Debit Card is specially designed for PNB premium account holders. You can personalise your debit card with your name on it. Get enhanced cash withdrawal limit of Rs 50,000 per day along with purchase limit of Rs. 1.25 lakhs per day at POS terminals or e-commerce websites across India Moreover enjoy purchase limit of $500 per day at POS terminals or ecommerce websites worldwide.

3)MITRA ATM Card:The PNB Mitra Card is specially designed to suit the requirements of Mitra Account holders and the following are its key benefits:  

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MITRA ATM Card is designed for all MITRA Account holders at PNB. Customers who do not have a MITRA account can also apply for it. This debit card can be used to withdraw cash from PNB ATMs across the country but cannot be used for making transactions at POS terminals and online merchant websites. Cash can be withdrawn through the Biometric system. Maximum daily cash withdrawal limit is Rs. 5,000.

4)RuPay Debit Card: 

RuPay Debit Card is based on the RuPay platform and can be used to make transactions across India. Cash can be withdrawn at only RuPay enabled ATMs and transactions can be made at only RuPay POS terminals.

5)RuPay Kisan Card: 

RuPay Kisan Card is exclusively made for PNB Kisan account holders. Enjoy a daily cash withdrawal limit of up to Rs. 25000 and daily spending limit of up to Rs.60000 at POS terminals and online merchant websites.

6)Master International Debit Card:In order to enable international transactions, Punjab National Bank introduced Master International Debit Card which is also available in the form of personalised and nonpersonalised variants. Master International Debit Card comes with enhanced cash withdrawal and transaction limits.  

Maximum cash withdrawal limit is Rs.50000 per day at ATMs Maximum daily spending limit at POS terminals and e-commerce websites in Rs.1.25 lakhs

For foreign transactions, the limits will be applicable according to the conversion rate. 7)Classic Debit Card (Master & RuPay Variant):Classic Debit Card is designed for general category account holders. It is available in both personalised and non-personalised versions, personalised classic debit card will have cardholder’s name on it. Classic Debit Card can be used to make fund transfer from one PNB account to another.    

Maximum daily cash withdrawal limit is Rs. 25000 at ATMs across the country. Maximum daily transaction limit is Rs.15000 at POS terminals and ecommerce websites established in India. There is no limit on fund transfer from your PNB account to another PNB account. Every transaction has a cap of Rs.1 lakh In case of third party transfers, maximum transfer limit is same as the available cash limit.

8)Platinum Debit Card:Platinum Debit Card is designed for elite account holders of PNB. This debit card is available in personalised variant which will have card holder’s name and photo on it. Get same characteristics and features as the classic debit card with some additional features such as: 

Enjoy enhanced cash withdrawal and purchase limit. Avail daily cash withdrawal of Rs.15000 and daily transaction limit of up to Rs.50000.

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Get daily spending limit of Rs.1.25 lakhs at POS and ecommerce websites. RuPay Platinum debit card can only be used within India and cannot carry out international transactions. Cardholders can opt for 2 add on cards for their close family members.

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9)EMV Card:-

EMV Debit Card can be used for making international transactions. It has an EMV chip and magstripe embedded in it which ensures safe and secure transactions. It is a personalised card which has the card holder’s name on it.   

Maximum daily cash withdrawals is Rs.50000 per day at ATMs Maximum transaction limit is Rs.1.25 lakhs per day at POS terminals and ecommerce websites. Cardholders can link a maximum of 3 accounts to their EMV card.

10)Rupay MUDRA Debit Card:MUDRA Debit Card is a non-personalised debit card which is offered on the RuPay platform  

Avail maximum cash withdrawals of Rs.25000 per day at all ATMs across India. Enjoy higher transaction limit of Rs.60000 per day at POS terminals and online merchant websites established in India.

INTRODUCTION :profile :l of Rs 20,000. Far-sighted visionaries and patriots like Lala Lajpat Rai, Mr. E.C. Jessawala, Babul Kali Prasono Roy, Lala Harkishan Lal and Sardar Dyal Singh Majithia displayed courage in giving expression to the spirit of nationalism by establishing the first bank purely managed by Indians with Indian Capital. During the long history of the Bank, 7 banks have merged with PNB. The Bank’s brand image and trust reposed by its customers have been reflected in growing customer base and rising business graph of the Bank. Domestic Business of the Bank is over Rs.10 lakh crore and the Bank continues to maintain its forte in low cost CASA deposits. The Bank has shaken off one of the biggest adversities in its history and has rebounded back. Focus on recovery and arresting fresh slippages with a simultaneous shift towards higher earnings through qualitative credit growth alongwith rationalization of Risk Weighted Assets (RWAs) has helped Bank to return to profit and improve CRAR. The Bank has been able to achieve better results in the quarter owing to MISSION PARIVARTAN, a transformational exercise underway for Business Excellence aimed at enhancing Efficiency, Productivity and Profitability for long term sustenance and giving the Bank an edge over its competitors. `Mission Parivartan Division`, an independent `THINK TANK` formed to initiate, implement and drive change through improvement in People, Products and Processes, has enabled Bank to serve the customers with enhanced vigour and zeal to live upto its tagline “The Name you can Bank Upon”.

MEANING:What is Online Banking? Online Banking, also known as net banking, e-banking or online banking, is the facility provided by banks and financial institutions which allows customers to use banking services via internet. There are scores of services like online money transfer, account opening, bill payment, tracking account activity, etc., which are made available to customers with the help of online banking. Online banking also allows banks to advertise their products and services in a manner that it reaches out millions of customers. However, in order to use online banking, an individual will require access to the internet, which is scarcely available in rural areas. Internet banking can also be accessed via mobile phones which have a data 3G/4G connection. With the help of online banking, there are several indispensable services which are made available to customers, without them having to personally visit the bank. Customers can perform financial transactions like transfer funds online, pay bills, apply for loans and open a savings account among various other debit card transactions. Under non-financial transactions, customers can carry out several activities which may require going to the bank like applying for a new cheque book, getting account statements, update contact information, start/stop payment, etc. Retail banking, also known as consumer banking, is the typical mass-market banking in which individual customers use local branches of larger commercial banks. Services offered include savings and checking accounts, mortgages, personal loans, debit/credit cards and certificates of deposit (CDs). In retail banking, the focus is on the individual consumer. Retail banking provides financial services for individuals and families. The three most important functions are credit, deposit, and money management. They are a component of commercial banking. First, retail banks offer consumers credit to purchase homes, cars, and furniture. These include mortgages, auto loans, and credit cards. The resulting consumer spending drives almost 70 percent of the U.S. economy. They provide extra liquidity to the economy this way. Credit allows people to spend future earnings now. Retail banks also offer small business loans to entrepreneurs. These small companies create up to 65 percent of all new jobs as they grow. Second, retail banks provide a safe place for people to deposit their money. Savings accounts, certificates of deposit, and other financial products offer a better rate of return compared to stuffing their money under a mattress. Banks base their interest rates on the Fed funds rate and Treasury bond interest rates. That's why they rise and fall over time. The Federal Deposit Insurance Corporation insures most of these deposits. Third, retail banks allow customers to manage your money with checking accounts and debit cards. That means they don't have to do all your transactions with dollar bills and coins. All of this can be done online, making banking an added convenience.

Retail banking aims to be the one-stop shop for as many financial services as possible on behalf of individual retail clients. Consumers expect a range of basic services from retail banks, such as checking accounts, savings accounts, personal loans, lines of credit, mortgages, debit cards, credit cards and CDs. Most consumers utilize local branch banking services, which provide onsite customer service for all of a retail customer's banking needs. Through local branch locations, financial representatives provide customer service and financial advice. Financial representatives are also the lead contact for underwriting applications related to credit-approved products. Retail banking encompasses the services offered to consumers by commercial banks. The term "retail" refers to the almost storefrontshopping nature of commercial banking services. Most commercial banks have extensive retail banking services and products to reach a wide consumer base. Here's a brief story about Bob's day at his bank XYZ. He arrives at the bank one day to deposit a $2000 paycheck into his account. He decides to deposit $1000 of the paycheck into his existing checking account. The other $1000 he decides to use to open a savings account. Bob sits with a bank representative who explains the various savings account options and helps him with opening an account once he's made a decision. Additionally, the account representative informs Bob of retirement plans the bank offers as well as educational savings plans for his children. Before he leaves, Bob also takes information on auto loans offered by the bank since he is considering purchasing a new car. While at the bank, Bob was able, in one place, to deposit money, open a savings account and find information relating to banking products he may need in the future.

Types of Retail Banks Most of America's largest banks have retail banking divisions. These include Bank of America, JP Morgan Chase, Wells Fargo, and Citigroup. Retail banking makes up to 50 to 60 percent of these banks' total revenue. There are many smaller community banks as well. They focus on building relationships with the people in their local towns, cities, and regions. They have less than $1 billion in total assets. Credit unions are another type of retail bank. They restrict services to employees of companies or schools. They operate as non-profits. That means they can offer better terms to savers and borrowers because they aren't as focused on profitability as the bigger banks.

Savings and loans are retail banks that target mortgages. They've almost disappeared since the 1989 savings and loans crisis. Lastly, Sharia banking conforms to the Islamic prohibition against interest rates. So borrowers share their profits with the bank instead of paying interest. This policy helped Islamic banks avoid the 2008 financial crisis. They didn't invest in risky derivatives. These banks cannot invest in alcohol, tobacco, and gambling businesses. Definition:Retail banking, also known as Consumer banking, refers to the offering of banking services to retail customers instead of institutional customers, such as companies, corporations and/or financial institutions. What is the definition of retail banking? Retail banking includes a wide range of banking services that belong to similar categories, such as savings accounts, checking accounts, consumer lending, credit cards, debit cards, mortgages, e-banking services, phone-banking services, insurance, investment and fund management. Consumers use local branches that have the capacity to deliver all these services to retail customers. In fact, retail-banking keeps the money circulating as the Fed allows only 10% of deposits on hand. So, the retail banks have to circulate the remaining 90% either in the form of loans or in the form of investment products

HISTORY:Before The 1980s, Banks Were Highly Regulated. Much Of This Came About In Response To The 1929 Stock Market Crash. In The 1930s, The Glass-Steagall Act Prohibited Retail Banks From Using Deposits To Fund Risky Stock Market Purchases. Banks Also Could Not Operate Across State Lines. Retail Banks Could Not Use Their Depositors' Funds For Investments Other Than Lending. They Often Could Not Raise Interest Rates. During The 1970s, These Banks Lost Business As Double-Digit Inflation Made Customers Withdraw Deposits. Retail Banks' Paltry Interest Rates Weren't Enough Of A Reward For People To Save. Banks Cried Out To Congress For Deregulation. The 1980 Depository Institutions Deregulation And Monetary Control Act Allowed Banks To Operate Across State Lines. Large Banks Began Gobbling Up Small Ones. In 1998, Nations Bank Bought Bank Of America To Become The First Nationwide Bank. The Other Banks Soon Followed. That Consolidation Created The Four National Banking Giants In Operation Today. It Also Allowed Banks To Raise Interest Rates On Deposits And Loans. In Fact, It Overrode State Limits On Interest Rates. Banks No Longer Had To Direct A Portion Of Their Funds Toward Specific Industries, Such As Home Mortgages. They Could Instead Use Their Funds In A Wide Range Of Loans, Including Commercial Investments. he Fed lowered its reserve requirements. That gave banks more money to lend, but it also increased risk. To compensate depositors, the Federal Deposit Insurance Corporation raised its limit from $40,000 to $100,000 savings. In 1982, President Reagan signed the Garn-St. Germain Depository Institutions Act. It removed restrictions on loan-to-value ratios for savings and loan banks. It also allowed these banks to invest in risky real estate ventures. By 1995, more than half of them had failed. The resultant savings and loan crisis cost $160 billion. In 1999, the Gramm-Leach-Bliley Act repealed Glass-Steagall. It allowed banks to invest in even riskier ventures. They promised to restrict themselves to lowrisk securities. That would diversify their portfolios and lower risk. But as competition increased, even traditional banks invested in risky derivatives to increase profit and shareholder value. All these extra factors forced banks to cut costs. They closed rural branch banks. They relied more on ATMs and less on tellers. They focused on personal services to high net worth clients and began charging more fees to everyone else.

Punjab National Bank (PNB) is a state-owned commercial bank located in New Delhi. PNB is one of the leading commercial banks in India. They offer banking products and also operate credit card and debit card business bullion business life and non-life insurance business and gold coins and asset management business. They are recognized as the bank offering highest levels of customer satisfaction in Delhi and Chennai. As on 31 December 2017 PNB's domestic branch network stood at 6957 along with 9598 ATMs. The bank has three overseas branches in Hong Kong Dubai and Offshore Banking Unit in Mumbai and Representative Offices (RO) at Dubai (UAE) Shanghai (China) Sydney (Australia) and Dhaka (Bangladesh). The bank has two overseas subsidiaries viz. PNB International Ltd. (UK) and Druk PNB Bank Ltd (Bhutan). The bank also has one associate company viz. JSC Tengri Bank (Kazakhstan) and one Joint Venture Bank in Nepal i.e. Everest Bank Ltd. The bank has got permission from RBI for opening Representative office in Yangon (Mynamar). Punjab National Bank was incorporated in the year 1895 at Lahore undivided India. The Bank has the distinction of being the first Indian bank to have been started solely with Indian capital. In the year 1940 the Bank absorbed Bhagwan Dass Bank a scheduled bank located in Delhi circle. In the year 1951 they acquired the 39 branches of Bharat Bank and in the year 1961 they acquired Universal Bank of India.Punjab National Bank was nationalised in July 1969 along with 13 other banks. In the year 1986 they acquired Hindustan Commercial which added Hindustan's 142 branches to the Bank's network. In the year 1993 they acquired New Bank of India which the GOI. During the year 1996 they developed a packaged for corporate customers for fast remittance of funds from different up-country branches. In the year they set up a representative office in Almaty Kazakhstan.In the year 2000 the Bank has introduced a scheme for providing finance against mortgage of immovable property. In September 2000 they commenced their gold business in the form of Gold Import Scheme. In November 2000 they launched an International Co-branded Credit Card of Punjab National Bank and Hongkong & Shanghai Banking Corporation (HSBC) in New Delhi. In March 2002 the Bank came out with their first Initial public offer (IPO) for 53060700 equity shares of Rs 10 each which resulted in the reduction of the government's shareholding in the Bank. During the year 2002 they started their branch in M.G. Road Bangalore named as Mid-Corporate Branch (MCD) to provide their corporate clients with a credit limit of Rs 3.5 crore and above. They made joint venture with Infosys for the implementation of a Centralized Banking Solution for them. Also they made a tie up with Cisco Systems for networking 3870 branches as part of their Rs 150 crore plan.In the year 2003 the Bank took over Kozhikode-based Nedungadi Bank Ltd (NBL). The Bank entered into an alliance with New India Assurance for selling their general insurance products. Also they opened a representative office in London. During the year PNB Capital Service Ltd was amalgamated with the Bank.In June 2003 the Bank entered into an MoU with Principal Financial Services Inc (USA) and Vijaya Bank for joint venture partnership in Life Insurance Pensions and Asset Management (MF) business. Also they formed a strategic alliance with Infrastructure Leasing and Financial Services Ltd (IL&FS) for setting up a private equity fund for investing in domestic companies.In the year 2004

the Bank acquired the assets of Hindustan Transmission Product Ltd. They signed a corporate agency agreement with Export Credit Guarantee Corporation of India Ltd (ECGC) for marketing ECGC's export credit insurance products through the network of the bank's branches. Also an MoU was signed with Intel for the deployment of various IT-related solutions. During the year the Bank signed an MoU with ICICI Bank for ATM network sharing. They awarded a project to Tata Consultancy Services (TCS) for implementing human capital management and payroll solution. They established a branch office in Kabul Afghanistan. Also they opened a representative office in Shanghai. The bank established an alliance with Everest Bank in Nepal that permits migrants to transfer funds easily between India and Everest Bank's 12 branches in Nepal. In the year 2005 the Bank unveiled ATM at Edappal. Also they opened a representative office in Dubai. In the year 2006 the Bank made a tie up with MasterCard International to launch a signature-based debit card. Also they made a tie up with Indian Airlines for online booking of air tickets. They opened a new branch in Uttarakhand. In October 2007 the Bank entered into MoU with India Infrastructure Finance Company with an aim to extend their cooperation and support to IIFC in areas of creating a deal flow of infrastructure projects. In January 2008 the Bank commenced commercial banking operations in Hong Kong. During the year 2008-09 the Bank opened 168 branches out of which 90 are new branches and 78 branches was added through upgradation of Extension Counters. They made collaboration with LIC for selling insurance policies and also made a tie up with Oriental Insurance for selling non-life policies on a referral basis. In June 2008 they entered into an MoU with ILFS Cluster Development Initiative Ltd for providing finance for various industrial infrastructure projects in the country. In September 2008 they signed an MoU with SMC Global Securities Ltd and Networth Stock Broking Ltd for providing online trading facility to Company's customers. They offered a unique '3 in 1 account' comprising of Saving Demat and Trading account. In February 2009 they commercially launched their credit cards with 2 types of consumer credit cards namely Gold and Classic. Also they entered into an agreement with Oriental Insurance Company to market insurance products a practice also known as bancassurance. In March 2009 the Bank entered into an understanding with Tata Motors for financing entire range of passenger cars. Also they executed an agreement with The Life Insurance Corporation of India for bancassurance life insurance under the provisions of IRDA's Referral Arrangement. During the year 2009-10 the Bank opened 524 domestic branches out of which 347 are at new locations while 177 branches was added through upgradation of existing Extension Counters. They deployed 1400 ATMs taking the the total count of ATMs to more than 3500 Nos. They opened two overseas branches 1 in Hong Kong and another at DIFC Dubai and started a JV banking subsidiary 'DRUK PNB Bank Ltd' in Bhutan. Also they opened a representative office in Oslo Norway.During the year the Bank sold 6.5% of their stake in UTI Assets Management Co Ltd and UTI Trustee Pvt Ltd thus bringing down their stake in both these companies to 18.5%. They launched Corporate Credit Card with Individual liability. Also they launched Merchant Acquiring Business through installation of Point of Sale (PoS) Terminals at Merchant Establishments and Internet Payment Gateway by integrating through Merchant Website with Brand Name PNB Biz.In May 2009 the Bank incorporated a subsidiary company namely PNB

Investment Services Ltd. In November 2009 they entered into an agreement with FIM Bank (Malta) Banca IFIS Italy and Blend Financial Services Ltd Mumbai for setting up a joint venture company for providing factoring forfeiting and trade finance related business.During the year 2010-11 the Bank introduced new set of products and services such as PNB Uphaar PNB Suvidha and World Travel Card. In December 13 2010 they acquired 63.64% stake in JSC Dana Bank of Kazakhstan. In January 12 2011 the Bank's joint venture India factoring and Finance Solutions Pvt Ltd started its commercial operations from Delhi Mumbai & Chennai.The total number of branches at the end of March 2011 rose to 5189. The branch network comprises 2047 Rural 1154 Semi Urban 1111 Urban and 877 Metropolitan branches. During the review period 210 domestic branches were opened. With 5189 branches including 28 Extension Counters the Bank has the largest network amongst the nationalized banks. As part of customer segmentation Bank has opened specialized Branches that include 6 Micro Finance branches 59 SME branches 11 International Banking Branches 17 Asset Recovery Management Branches 13 Mid Corporate Branches 11 Large Corporate Branches 73 Retail Asset Branches 11 Agriculture Finance Branches 3 high-tech agriculture branches 1 Capital Market Services Branch and 1 International Service Branch. Besides 41 Back Offices 2 Special Foreign Exchange Offices 17 Special MICR Centres 41 Service (Regional Clearing Centre) centres 4 Financial Inclusion Service Centres 3 Centralised Draft Payable Centres 1 Central Clearing Service Centre and 1 Depository Back Office are established to reduce delivery time and improve response time.On 5 March 2010 PNB announced that the bank has received permission from RBI for setting up a representative office in Sydney Australia.On 13 December 2010 PNB announced that the bank has completed the transaction for acquisition of 63.64% stake in JSC Dana Bank Kazakhstan. PNB has acquired 35 million shares of 1000 Tenge each at par for 3.5 Bn Tenge (USD 23.765 million approx.) which has raised the capital of JSC Dana Bank to the level of 5.5 Bn Tenge from the existing 2 Bn. Tenge. On 12 January 2011 PNB announced that it has bought Principal Financial Group of Mauritius (PFG) and U K Paints stake of 26% and 32% respectively in Principal PNB Life Insurance Company Ltd. After the transaction the bank's stake in Principal PNB Life Insurance Company Ltd stands at 88%. PNB also said at that time that it will continue to support Principal PNB Asset Management Company Pvt Ltd for a period of three years. On 15 February 2011 PNB announced that the bank has entered into an arrangement with Weizmann Forex Ltd. Mumbai (Principal Agent) for handling inward remittances under MTSS (Money Transfer Service Scheme) through Western Union. The bank also entered into an arrangement with BFC Forex & Financial Services Ltd. Thane (Maharashtra) for handling inward remittances under MTSS (Money Transfer Service Scheme) through the web based product EzRemit.On 28 April 2011 PNB announced the issue and allotment of 15.09 lakh equity share at issue price of Rs 1218.82 per equity share to Government of India on preferential basis aggregating Rs 184 crore.On 28 March 2012 PNB announced that upon receipt of allotment money of Rs 1589.90 crore from Life Insurance Corporation of India (LIC) the bank has allotted 1.58 crore equity shares at issue price of Rs 1003.69 per share to LIC on preferential basis. On 2 April 2012 PNB announced that upon receipt of allotment money of Rs 654.99 crore from Government of India the bank has allotted 65.25 lakh equity shares at issue price of

Rs 1003.69 per share to Government of India on preferential basis.On 16 January 2013 PNB announced that the bank has acquired 30% stake in Metlife India Insurance Co. Ltd.On 6 March 2013 PNB announced that upon receipt of allotment money of Rs 1247.99 crore from Government of India on 4 March 2013 the bank has allotted 1.42 crore equity shares at issue price of Rs 873.05 per share on preferential basis to Government of India.On 28 October 2013 PNB announced that the Chairman & Managing Director of the bank as per authority delegated by the Board has approved issuance of equity shares of face value of Rs 10 each for an amount upto Rs. 500 crore at such price as may be decided as per SEBI (ICDR) Regulations 2009 on preferential basis in favour of Government of India subject to necessary approvals. On 4 March 2014 PNB announced that the bank has sold its entire stake in Credit Information Bureau India Ltd. (CIBIL) to TransUnion International Inc. (FII). On 1 April 2014 PNB announced that it has sold its entire 30% stake in India Factoring & Financial Solutions Ltd. (IFFSL) to parent promoter FII (FIM Bank (Malta) and realized Rs 107.83 crore. On 4 July 2014 PNB announced that it has sold 41% stake in High Mark Credit Information Services Ltd. (High Mark) to CRIF and realized Rs 4.15 crore.The Board of Directors of PNB at its meeting held on 19 September 2014 granted inprinciple approval for sub-division of existing equity shares of face value of Rs 10 each into 5 equity shares of face value of Rs 2 each.On 1 April 2015 PNB announced that capital funds to the tune of Rs 870 crore have been received from the Government of India on 31 March 2015 for issue and allotment of 4.42 crore equity shares at a price of Rs 196.80 per equity share to Government of India on preferential basis in accordance with Regulation 76(1) of SEBI ICDR Regulations.On 30 September 2015 PNB announced that consequent upon receipt of capital funds to the tune of Rs 1732 crore from the Government of India on 29 September 2015 the bank has issued and allotted 10.9 crore equity shares at a price of Rs 158.84 per equity share on preferential basis to Government of India in accordance with Regulation 76(1) of SEBI ICDR Regulations.On 15 September 2016 PNB announced that consequent upon receipt of capital funds to the tune of Rs 2112 crore from the Government of India on 14 September 2016 the bank has issued and allotted 16.43 crore equity shares at a price of Rs 128.49 per equity share on preferential basis to the Government of India in accordance with Regulation 76(1) of SEBI ICDR Regulations.Punjab National Bank (PNB) and India Post Payments Bank (IPPB) signed a memorandum of understanding on 17 January 2017 wherein PNB shall provide technology platform for pilot launch of IPPB on receipt of regulatory approval from Reserve Bank of India. The Board of Directors of PNB at its meeting held on 2 November 2017 authorized the management to partially sell its stake in PNB Housing Finance Ltd. Further consequent upon the exercise of call option by the Principal Group the Board has approved to offload PNB's entire stake in Principal PNB Asset Management Company and Principal trustee Company Pvt Ltd to the Principal group.On 5 December 2017 PNB announced that the bank successfully sold 98.15 lakh equity shares of PNB Housing Finance Ltd (PNBHFL) to different investors (Non Retail and retail) at above the floor price /cut off price with gross sales consideration of Rs 1315.33 crore.On 18 December 2017 PNB announced allotment of 29.76 crore equity shares to successful eligible qualified institutional buyers at a price of Rs 168 per share. Earlier PNB on 14 December 2017 announced the closure

of the qualified institutions placement (QIP) of equity share. The bank raised Rs 5000 crore from the QIP.The Board of the Directors of PNB at its meeting held on 6 February 2018 accorded approval for Capital Infusion by Government of India up to Rs 5473 crore.On 14 February 2018 PNB informed the stock exchanges of detection of a massive fraud of Rs 11394.02 crore. On 12 February 2018 on the basis of investigation report total fraud of Rs 11394.02 crore (about USD 1771.69 million) in case of unauthorized issuance of Letters of Undertakings Foreign Letter of Credits and Inland Letter of Guarantees in the group accounts of Nirav Modi Group and M/s Gitanjali Group and in the account of M/s. Chandri Paper & Allied Products Pvt. Ltd. was reported to RBI. Later on 26 February 2018 PNB informed the stock exchanges that the quantum of reported unauthorized transactions can increase by about USD 204.25 million.

PUNJAB NATL.BANK - COMPANY INFO Nominee (RBI) :

Rabi N Mishra

Director(PartTime NonOfficial) :

Mahesh Baboo Gupta

Company Secretary :

Balbir Singh.

Chairman (Non-Executive) :

Sunil Mehta

Managing Director & CEO :

Sunil Mehta

Nominee (Govt) :

Ravi Mital

Executive Director :

Lingam Venkata Prabhakar

Independent Director :

Asha Bhandarker

Director (Shareholder) :

Sanjay Verma

Executive Director :

Agyey Kumar Azad

AUDITOR :

Suri & Co/SPMG & Co/MKPS & Associates

IND NAME :

Banks - Public Sector

HOUSE NAME : vision:-

Government of India - PNB

To promote fair banking practices by maintaining transparency in various products and services offered to make banking an enriching experience.

how to work retail banking:ow Retail Banks Work Retail banks use the depositors' funds to give out loans. They make money by charging higher interest rates on loans than they pay on deposits. The Federal Reserve, the nation's central bank, regulates most retail banks. Except for the smallest banks, it requires all other banks to keep around 10 percent of their deposits in reserve each night. They are free to lend out the rest. At the end of each day, banks that are short of the Fed's reserve requirement borrow from other banks to make up for the shortfall. The amount borrowed is called the fed funds. Retail banking encompasses the services offered to consumers by commercial banks. The term "retail" refers to the almost storefront-shopping nature of commercial banking services. Most commercial banks have extensive retail banking services and products to reach a wide consumer base. Here's a brief story about Bob's day at his bank XYZ. He arrives at the bank one day to deposit a $2000 paycheck into his account. He decides to deposit $1000 of the paycheck into his existing checking account. The other $1000 he decides to use to open a savings account. Bob sits with a bank representative who explains the various savings account options and helps him with opening an account once he's made a decision. Additionally, the account representative informs Bob of retirement plans the bank offers as well as educational savings plans for his children. Before he leaves, Bob also takes information on auto loans offered by the bank since he is considering purchasing a new car. While at the bank, Bob was able, in one place, to deposit money, open a savings account and find information relating to banking products he may need in the future.

characteristics:Retail banking is, however, quite broad in nature – it refers to the dealing of commercial banks with individual customers, both on liabilities and assets sides of the balance sheet. Fixed, current / savings accounts on the liabilities side; and mortgages, loans (e.g., personal, housing, auto, and educational) on the assets side, are the more important of the products offered by banks. Related ancillary services include credit cards, or depository services. Retail banking refers to provision of banking services to individuals and small business where the financial institutions are dealing with large number of low value transactions. This is in contrast to wholesale banking where the customers are large, often multinational companies, governments and government enterprise, and the financial institution deal in small numbers of high value transactions.

Consumer Banking Focus Most retail banks focus on the needs of consumers versus commercial account holders. Teller cages are most often dedicated to walk-in consumer patrons. Retail bank tellers are trained to focus on consumer checking and savings needs. Branch managers are trained to offer customer-service issues in regards to those accounts. Commercial account transactions are typically limited to on to two separate stations dedicated to merchant accounts. Internal Promotions to Cross-Sell Services Retail banks utilize their internal and external space to promote and cross-sell services. Inside of the bank, customers will see standing floor signs to promote interest rates on mortgages and savings accounts. Desks that house deposit slips are typically topped with brochures about various checking and savings instruments. Tellers might even wear a badge or button that states “ask me about …” to promote new services. CRM Practices Customer Relationship Management (CRM) techniques are growing in application among most major retail banks. Websites assist and guide current and prospective customers to branch locations. Site visitors are offered the opportunity to provide feedback about their online banking experiences as well as their on-site banking experiences. Retail banks use this information to track and monitor customer satisfaction, gauge the feasibility for new products and services, and to identify areas for improvement of the customer service experience inside of branches. Extended Hours, Services, Locations Retail banks are often governed by state banking regulations in terms of hours of operation. Banks deploy savvy strategies to make sure that no opportunity is missed to service customers. Most understand that customer’s hours may not match bank hours. As a result, most retail banks have ATM machines that can accommodate every banking need from making a deposit and inquiring about account balances, to

transferring funds between checking and savings accounts. Banks are now also offering their services inside of major grocery stores, retail super stores, gas stations and convenience stores, to make their services accessible on a 24-hour basis so customers have “touch point” access to retail banking services near where they work, live and shop. New Customer Incentives Retail banks have a major marketing mission to increase new customers. They utilize many advertising tactics and strategies to achieve their new customer goals. This often includes broadcast television and radio advertising, print and magazine advertising, and public relations efforts to sponsor national and local events. Some retail banks will provide a cash reward up to several hundred dollars to open a new account. The overall goal is to increase new accounts, among both prospective and existing customers. Banks capture information to rate and rank new customers via information furnished on credit applications to assess credit worthiness and approve new account applications. • Retail banking aims at doing banking business in large volume of transactions involving low value. • The retail banking portfolio includes deposits and assets linked products as well as other financial services provided to individuals for personal consumption. Retail banking business is an attractive market segment with opportunities for growth and profits. • It provides an opportunity to banks to diversify their asset portfolio. Since loans are given to a large number of consumers and transactions have very low value, the risk of NPA is reduced because all the consumers do not make default in making loan repayment at a time. • Retail banking is based on the maxim “do not keep all the eggs in one basket”

research and methodology OBJECTIVES:-

India strives for economic development, and it has done so since it gained its independence from Europe in 1947. Its commitment to growth became most pronounced when, in 1990, it chose to shift from a government-controlled banking system to a privately controlled banking system for the overall good of the economy. Now, retail banks in India work to further the same growth-oriented objectives. Stimulate the Indian Economy While the Indian economy is steadily growing, poverty is still widespread. Since banks thrive in an economically healthy environment, they have a vested interest in promoting the health of the citizens in their market. One of the approaches that Indian banks use to stimulate the Indian economy includes providing access to financial services that could help citizens create jobs, access education and develop skills. India strives for economic development, and it has done so since it gained its independence from Europe in 1947. Its commitment to growth became most pronounced when, in 1990, it chose to shift from a government-controlled banking system to a privately controlled banking system for the overall good of the economy. Now, retail banks in India work to further the same growth-oriented objectives. Tailor Services to Indian Consumers As of July 2010, India had more than one billion inhabitants. This means India has the second largest population in the entire world. About 82 percent of India's onebillion-plus inhabitants--about 948,000,000 people--practice Hinduism. Hinduism has an estimated 330,000 deities, and worshipers of these deities make donations to them. Retail banks meet India’s religious demands by providing their religious

consumers with convenient ways to make online donations to their deity or deities of choice. Stimulate the Indian Economy While the Indian economy is steadily growing, poverty is still widespread. Since banks thrive in an economically healthy environment, they have a vested interest in promoting the health of the citizens in their market. One of the approaches that Indian banks use to stimulate the Indian economy includes providing access to financial services that could help citizens create jobs, access education and develop skills. India has about 600,000 villages, many of which remain financially underserved. Providing financial services to these villages and educating their inhabitants about the proper use of those services furthers the objective of stimulating the Indian economy.

Serve the Growing Population of Wealthy Citizens Every year since 1997, India's economy consistently grew by about seven percent. India's percentage of high-net-worth individuals is slated to grow at a rate that is among the highest of any other nation in the world. For banks, growing wealth means a growing need for car loans, mortgages, credit cards and wealth management services. Indian retail banks aim to meet these needs by providing a variety of innovative services. Be a One-Stop Shop for Consumers Retail banks in India recognize that if they want to remain competitive, they must reduce the need for clients to jump from bank to bank to have various needs met. They do this by expanding their number of locations and improving their technology. The aim is to become a one-stop shop so that they can provide their customer with the convenience that she is unable or unwilling to do without.

Mission:"Creating Value for all its customers,Investors and Employees for being the first choice for all stakeholders." Vision:"To position PNB as the `Most Preferred Bank` for customers, the `Best Place to Work In` for employees and a `Benchmark of Excellence` for the industry." Fired by the spirit of nationalism and founded on the idea that Indians should have a national bank of their own, Punjab National Bank Ltd was the result of the efforts of far-sighted visionaries and patriots, among whom were persons like Lala Lajpat Rai, Mr. E C Jessawala, Babu Kali Prasono Roy, Lala Harkishan Lal and Sardar Dyal Singh Majithia. Incorporated under the Act VI of 1882, Indian Companies Act, the Bank commenced operations on April 12, 1895 from Lahore, with an authorised total capital of Rs 2 lac and working capital of Rs 20,000. Prophetically, the Bank chose "Stability" as its telegraphic address, as the future course of events were to prove - the Bank withstood various financial crises including the trauma in the form of partition of India when the Bank had to close 92 offices (33%) in west Pakistan which constituted 40% of its deposits and 15 of its staff fell victims to the frenzy. The registered office was shifted to Delhi and the Bank honoured all the deposit claims of the refugees even on the basis of whatever little evidence they could produce. Subsequently, the Bank registered impressive performance and grew from strength to strength. A pioneer throughout, the Bank distinguished itself by appointing auditors in 1895 long before it was mandatory; introduced the "teller" system in 1944 (another first ); established profit sharing bonus, provident fund and voluntary outside audit well before they formed keystones of good management. Nationalisation came in 1969 which unleashed a new chapter in the long history of the Bank. Keeping with the economic ideology of catalyzing development and amelioration of poverty by funding various self-employment schemes, PNB expanded its presence rapidly in unbanked areas. The Bank donned the role of a facilitator in providing the vital input of credit and consistently exceeded the national goals in respect of priority sector lending. With its large presence throughout the country and with a view to strengthening the rural credit delivery system, the Bank sponsored Regional Rural Banks (RRBs). PNB has established itself firmly as one of the premier banking institutions in the country with a long tradition of sound and prudent banking. The bank`s growth has been aided by take-over/merger of 7 private sector banks during different periods in its history. The first ever and the only merger of a nationalized bank with PNB was in 1993, viz., New Bank of India. By late 1980s when the first whiff of liberalization came about, the Bank initiated strategic moves towards diversification; and in 2002, 20% of government ownership was disinvested through a very successful IPO to the public. In 2003, the erstwhile Nedungadi Bank Ltd (e-NBL), a Kerala based private bank was amalgamated with

Punjab National Bank. This was the seventh merger in PNB’s history of more than 115 years. PNB’s management team has been quite successful in managing the mergers and ensuring the integration process in a smooth and effective manner. It may be added that no other bank in the nationalized bank group has a track-record of so many mergers. This has improved the franchise value of the Bank, particularly, in the relatively underrepresented Kerala region. In order to meet future capital requirements on account of implementation of Basel II norms, in March 2005, the Bank came out with Follow-on Public Offer (FPO) through the book building process, reducing the shareholding of Govt of India to 57.8%. Punjab National Bank with more than 5400 domestic offices including Extension Counters has the largest network amongst the nationalized banks i.e. next only to SBI. The bank has a strong franchise value and provides a host of financial products and services, both to the retail customer and corporate business. It has continued to fulfill its social responsibilities and made significant progress in adoption of technology, keeping with its objective of transforming itself into a techno-savvy Bank. During 2008-09, the Bank achieved the landmark of becoming the largest Nationalized Bank to bring ALL BRANCHES/EXTENSION COUNTERS into Core Banking Solution (CBS). The strong franchise enjoyed by the Bank, combined with its technological capabilities provides the Bank competitive advantages. The Bank also continues to discharge its social obligations and addresses environmental concerns with added vigour, which include free medical camps, distribute artificial limbs, tree plantation and blood donation camps, besides donations to Hospitals, Schools etc. The Bank supports various societies, charitable institutions and NGO /organisations working for the benefit of downtrodden, weaker sections of society, orphans, underprivileged, spastics, handicapped, mentally retarded children, women in shelter homes, etc. The Bank also contributes for fighting diseases like diabetes, tuberculosis, AIDS, leprosy etc. Donations are also extended for purchase of water coolers, ambulances and building infrastructure facilities at hospitals/sch

Hypothesis Findings and Hypothesis Testing & Conclusion Banking sector being backbone of the economy, its performance is vital for the performance of economy. The major economic indicators of the economy like Gross Domestic Product, Tax –GDP ratio, Index of Industrial Production, Foreign Direct Investment, Bank Deposit Growth, Credit Off take have been showing decelerating trend in last five yearsThe global financial crisis of 2008 changed the growth momentum achieved during 2004-08. The large fiscal stimulus of 2010 and 2011 created temporary spike in GDP growth. The fiscal deficit started increasing at a very high level. This reduced ability of government in stimulating the economy. The net result of slow government expenditure along with lull in private consumption and investment spending reduced the growth rate to below 5%. The high growth years The high growth years witnessed the goldilocks period. The high growth coupled with low inflation prompted RBI to reduce major monetary policy rates. The Cash Reserve Ratio and LiquidityRatio were reduced during this period. The Repo and Reverse Repo rates were also reduced. The net effect was that deposit and advances interest rates continued to come down. The credit off take increased to the highest level. The deposit growth rate which picked at 24% of GDP and Credit Growth at 37% of GDP in the year 2005-06, the high growth years created unprecedented opportunities of business. The big tide of global growth lifted all boats of the economy. The performance of banks during the same time reached at the highest levels. Deposits and advances were growing at high levels. Non – performing assets were reducing fast. Profitability was improving of commercial banks. The low growth years Financial crisis in western world created doubts in the minds of depositors about couple of banks in India. The misconception reached the level where people started withdrawing their deposits from couple of banks with fear of bankruptcy of these banks. The GDP which was growing at an average of 9.3% in preceding three years came down to 6% in 2008-09. The slowdown in world economic growth and resultant slowdown in Indian economy was evident. Government had to stimulate economy. the

economic activities continued to slowdown. This reduced GDP growth showed its impact on all sectors including banking. The level of deposits increased at 16% of GDP and Credit Growth at 17% of GDP in the year 2012-13. This study is an attempt to access the performance of banks during this turbulent time. The parameters are considered between the high and low growth years to find out whether banks continuedto perform at the same level or their performance showed a similar trend. The number of banks is selected across the types of banks. The fifteen banks which are chosen continue to have more than 52% of the total business (Deposits and Advances) done by all commercial banks reporting to RBI. The summary of finding is given on the parameters considered for the study. 8.1 Capital Adequacy • Commercial banks need to maintain certain level capital against the business that they do. BASEL Committee has given the criteria from time to time to maintain Tier I and Tier II capital. It has been observed that level of bank capital has gone up in low growth years. • The ability and freedom of private sector banks to raise the capital helps these banks to maintain high level of capital adequacy ratio. The average of 11% capital Adequacy has improved to 12.5% of the total assets in low growth years. The higher the level of bank capital, better it is for the bank to withstand the losses created by the banks. • DBS had the highest 30.06% capital adequacy during high growth years. ICICI bank has the highest 17.61% capital adequacy in low growth years. It has been observed that ICICI concentrated on assets quality improvement in last couple of years, contrary to the high growth obsession it had during high GDP growth years. • SCB has been maintaining lowest level of capital adequacy among the selected banks, during the entire time period of analysis. SCBs capital adequacy ratio has been in the range of 10.25% to 11.75% of total assets. • It has been observed that p values calculated for this parameter, except for couple of banks, are not less than 0.05% on level of significance hence it is

concluded that there is no significant change in the performance of banks in case of capital adequacy requirements . 8.2 Assets Quality One of the important aspects of banking is the quality of assets it has. The lower the bad loans profitable it is for a bank. The non-performing assets reflect the quality of assets. It has been observed that non-performing assets were reducing during 2004-08 because credit growth was highest during the same time. The standalone nonperforming assets are increasing throughout the period. This has been a concern in banking system. • The non-performing assets started increasing because slowing economic activities and increasing interest rates in last five years. The high debt ridden companies are findingOne of the important aspects of banking is the quality of assets it has. The lower the bad loans profitable it is for a bank. The non-performing assets reflect the quality of assets. It has been observed that non-performing assets were reducing during 200408 because credit growth was highest during the same time. The standalone nonperforming assets are increasing throughout the period. This has been a concern in banking system. • The non-performing assets started increasing because slowing economic activities and increasing interest rates in last five years. The high debt ridden companies are fiit difficult to service their debt on time. • The corporate debt restructuring has been on the rise in last couple of years. The banks considered in the study have shown a trend. Private sector banks have been able to control the level of non-performing assets throughout the period. Public sector banks had lower ranking during high growth years reflecting the inability to control the bad assets. • Foreign sector banks have been ranked during high growth years reflecting the inability to control the bad assets. • Foreign sector banks have been ranked lower in low growth years reflecting inability to control the bad assets. AXIS and HDFChave the highest rank during high growth years. • AXIS has the highest rank in low growth years. • DCB has been ranked lowest throughout the period of analysis showing it has never been able to control bad assets. • It has been observed that p values calculated for this parameter, except for couple of banks, are not less than 0.05% on level of significance hence it is concluded that there is no significant change in the performance of banks in caseof assets quality parameter.

8.3 Management Efficiency • The decision making capacity and efficiency of top management and human resource is reflected by this parameter. The business and profit per employee reflects how productive the human resource of a bank is. • The low level of cost of deposits reflect the ability of top management to have right mix of low cost high volatile deposits with high cost low volatility deposits. The high level of credit to deposit ratio shows that ability of management to find enough opportunities to lend. • The competition has intensified in the banking sector; management efficiency provides the necessary competence to the bank. The inter group comparison of banks show a very different picture. • The public sector banks are known for employing more manpower. • Private sector and foreign sector banks use third party services more often which increases their efficiency level. Public sector banks have also been allowed to avail such services. It has now become level playing field. • The efficiency still differs from one type to other type of banks. Foreign sector banks have the highest efficiency rankings througoutthe time period of this study. Profit per employee of foreign sector banks is four times that of public sector banks. Private sector banks have been ranked between public and foreign sector banks. • CITI has been ranked highest during high growth years. • SCB has been ranked and high level of credit to deposit ratio highest during low growth years. The usual non performing bank called DCB has been ranked lowest in this parameter throughout the period of time. The reason DCB has been ranked lowest is because it has been facing losses during most of the years of analysis. • It has been observed that p values calculated for this parameter, except for couple of banks, are less than 0.05% on level of significancewhich proves that null hypothesis is rejected and the alternate hypothesis that there has been a significant difference in the performance of banks is accepted.

8.4 Earnings capacity • Corporate sector works for profit. The profitability of any business concern depends on its productivity. Productivity determines earning capacity. • The return on assets and return on equity are most important parameters of an organization to measure productivity. Since banks depend on two types of income (Interest Income and Fee based Income), interest income is considered separately as a percentage of total assets, and total income is considered as a percentage of total assets and equity infused in the bank. • Return on investment (ROI) ultimately determines the sustainability of an organization. The ability of using bank assets to generate income and profit is measured in this parameterThe net interest margin, which is difference between interest rate received on advances and interest rate paid on deposits, is one of the most important parameter from the prospective of productivity. • SCB is ranked highest in high growth years among the banks analyzed in this study. • HDFC is ranked highest in low growth years which reflect the ability of this bank to perform in tough economic environment. • Foreign sector and private sector banks have highest rankings in this parameter. • Productivity depends on ability of the bank and not on sector it operates in, is reflected by the lowest performance of DCB. • It has been observed that p values calculated for this parameter, except for couple of banks, are not less than 0.05% on level of significance hence it is concluded that there is no siginifcantchange in the performance of banksin case of earnings capacity parameter.

Liquidity • Commercial bank business depends on deposits. Depositors more often expect their money to for transactions. The majority of transactions in India still happen through cash. • People’s faith in a bank is of utmost importance for a bank to function as a commercial organizationPeople’s faith can only be achieved by giving as much cash as they may wish to withdraw. Maintaining enough cash in the system is critical for the banks. • High liquidity lowers profitability and lower liquidity challenges the faith of depositor. The cash deposit ratio and current account and savings account deposits to total deposits ensure the adequate flow of liquidity in the system. • Deutsche has been ranked highest throughout the time period of analysis and DBS is ranked lowest throughout the time period of analysis. • Deutsche and DBS being from the same sectorshowcase that it depends on how individual banks are managed rather than which sector they belong to. • PNB saw the highest decline in ranking in this parameter. • SBI has the highest improvement. • Public sector banks as a group are ranked lowest during the analysis in low growth years. It is worth noting that PNB has second rank and BOB has the fourteenth rank in low growth years. This reiterates the fact that it depends on individual bank rather than group. • It has been observed that p values calculated for this parameter, except for couple of banks, are less than 0.05% on level of significance which proves that null hypothesis is rejected and the alternate hypothesis that therehas been a significant difference in the performance of banks is accepted.

8.6 Deposits • Deposits of commercial banks have gone up from high growth years to low growth years. • ICICI could not maintain the deposit growth rate of high growth years. The default fear of 2008 reduced the confidence on this bank. ICICI borrowed heavily to fund advances it gives to the borrowers. • SBI has the highest growth rate in deposits in low growth years. The campaign it had in 2008 as “safe Bank of India” yields the result in case of high deposit growth. It is observed that overall growth of deposits in the system (all commercial banks together) reduced substantially during last five years. • There is a strong case to assume that smaller banks in India could not attract depositors the way big banks could in last couple of years . • The banks studied have shown that public sector bank deposits increased in low growth years. • Private and foreign sector bank deposits decreased in low growth years. This can be attributed to the faith of depositors. Financial crisis changed the way banks are perceived in India. Public sector banks being largely owned by government people have more faith in these banks. • The growth rates at cumulative level are divided in high growth and low growth years for all the banks considered for this study. The growth rate data is given as (high growth years, low growth years). • Public sector banks; SBI (12.87, 17.92), PNB (17.04, 18.94) BOB (18.30, 25.54), BOI (18.74, 20.82), Canara (16.53, 18.43) all banks have showed increase in growth of deposits in low growthyears. • Private sector banks; ICICI (39.80, 4.26), Axis (39.39, 23.87), HDFC (35.78, 24.38), DCB (13.70, 8.33), IndusInd (17.45, 23.33). All banks have showed decrease in growth of deposits in low growth years except IndusInd. • Foreign sector banks; CITI (21.54, 7.70), SCB (15.69, 11.18), HSBC (28.06, 6.39), Deutsche (50.04, 8.97), DBS (120, 26.93) All banks have showed decrease in growth of deposits in low growth years. • It has been observed that p values calculated for this parameter are less than 0.05% on level of significance which proves that null hypothesis is rejected and the alternate hypothesis that there has been a significant difference in the performance of bank is accepted.

8.7 Advances • The advances given by banks largely determine the income for the bank. The advances can be given from deposits and bank borrowed money. • The individual bank growth in advances is calculated. The growth rates at cumulative level are divided in high growth and low growth years for all the banks considered for this study. The growth rate data is given as (high growth years, low growth years). • SBI (24.91, 20.31), PNB (17.04, 18.94) BOB (18.30, 25.54), BOI (18.74, 20.82), Canara (16.53, 18.43). There has been marginal rise in advances growth in low growth years except for SBI. • ICICI (34.57, 6.17),AXIS (53.43, 27.27), HDFC (40.23, 31.02), DCB (13.69, 11.59), IndusInd (19.54, 28.26). There has been significant decline in advances growth on low growth years except IndusInd. • CITI (25.14, 6.62), SCB (20.77, 13.22), HSBC (29.74, 4.82), Deutsche (45.18, 24.36), DBS (111.98, 45.73). There has been significant decline in advances growth in low growth years. • This reflects the actual slowing economy. The slowing GDP is reflecting in reduced growth rate of advances. • It has been observed that p values calculated for this parameter are less than 0.05% on level of significance which proves that null hypothesis is rejected and the alternate hypothesis that there hasbeen a significant difference in the performance of banks is accepted.