Comparative Analysis Of Bank

6.

Introduction

Banking 6.1 Business of banking Banking, in a traditional sense is the business of accepting deposits of money from the public for the purpose of lending and investment. These deposits can have a distinct feature of being withdraw able by cheques, which no other financial institution can offer. In addition to this banks also offer various other financial services also which include: •

Issuing Demand drafts and travellers cheques

•

Collection of cheques, bills of exchange

•

Safe deposit lockers

•

Issuing letters of credit and letters of guarantee

•

Sale and purchase of foreign exchange

•

Custodial services

•

Investment services

•

The business of banking is highly regulated since banks deal with money offered to them by the public and public and ensuring the safety of this public money is one of the prime responsibilities of the bank. That is why banks are expected to be prudent in their lending and investment activities. The major regulations and acts that govern the banking business are:

•

Banking Regulations Act

•

Reserve Bank of India Act

•

Foreign Exchange Regulation (Amendment) Act, 1993

•

Indian Contract Act

•

Instruments Act

Banks lend money either for productive purposes to individuals, firms, corporate etc or for buying house property, cars and other consumer durable and for investment purposes to individuals and others. However, SCB banks do not finance any speculative activity. Lending is risk taking. The risk should be covered by having prudent norms for lending.

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7.

Current Banking Sector in India

MARKET SHARE

REGULATIONS ON FOREIGN BANKS

3% 5%

6% 6% National Banks Corporation Banks Private Banks Multinational Banks Money Lenders & Others

80% Chart 1

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8.

History of Standard Chartered Bank

The Standard Chartered Group was formed in 1969 through a merger of two banks: The Standard Bank of British South Africa founded in 1863, and the Chartered Bank of India, Australia and China, founded in 1853. Both companies were keen to capitalize on the huge expansion of trade and to earn the handsome profits to be made from financing the movement of goods from Europe to the East and to Africa.

8.1 The chartered Bank Funded by James Wilson following the grant of a Royal Charter by Queen Victoria in 1853. Chartered opened its first branches in Mumbai (Bombay), Calcutta and Shanghai in 1858, followed by Hong Kong and Singapore in 1859. Traditional business was in cotton from Mumbai (Bombay), indigo and tea from Calcutta, rice in Burma, sugar from Java, tobacco from Sumatra, hemp in Manila and silk from Yokohama. Played a major role in the development of trade with the East which followed the opening of the Suez Canal in 1869, and the extension of the telegraph to China in 1871. In 1957 Chartered Bank bought the Eastern Bank together with the Ionian Bank’s Cyprus Branches. This established a presence in the Gulf.

8.2 The Standard Bank Founded in the Cape Province of South Africa in 1862 by John Paterson. Commenced business in Port Elizabeth, South Africa, in January 1863. Was prominent in financing the development of the diamond fields of Kimberley from 1867 and later extended its network further north to the new town of Johannesburg when gold was discovered there in 1885. Expanded in Southern, Central and Eastern Africa and by 1953 had 600 offices. In 1965, it merged with the Bank of West Africa expanding its operations into Cameroon, Gambia, Ghana, Nigeria and Sierra Leone. In 1969, the decision was made by Chartered and by Standard to undergo a friendly merger. All was going well until 1986, when Lloyds Bank of the United Kingdom made a hostile takeover bid for the Group. When the bid was defeated,

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Standard Chartered entered a period of change. Provisions had to be made against third world debt exposure and loans to corporations and entrepreneurs who could not meet their commitments. Standard Chartered began a series of divestments notably in the United States and South Africa, and also entered into a number of asset sales. From the early 90’s, Standard Chartered has focused on developing its strong franchises in Asia, the Middle East and Africa using its operations in the United Kingdom and North America to provide customers with a bridge between these markets. Secondly, it would focus on consumer, corporate and institutional banking, and on the provision of treasury services – areas in which the Group had particular strength and expertise. In the new millennium it acquired Grind lays Bank from the ANZ Group and

the

Chase

Consumer

banking

operations

Fig. 1

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in

Hong

Kong.

9.

Recent Alliances & acquisitions

In 2000, Standard Chartered acquired Grind lays Bank from ANZ Bank, increasing its presence in private banking and further expanding its operations in India and Pakistan. Standard Chartered retained Grind lays private banking operations in London and Luxembourg and the subsidiary in Jersey, all of which it integrated into its own private bank. This now serves high net worth customers in Hong Kong, Dubai, and Johannesburg under the name Standard Chartered Grind lays Offshore Financial Services. In India, Standard Chartered integrated most of Grind lays' operations, making Standard Chartered the largest foreign bank in the country, despite Standard Chartered having cut some branches and having reduced the staff from 5500 to 3500 people. On 15th April 2005, the bank acquired Korea First Bank, beating HSBC in the bid. Since then the bank has rebranded the branches as SC First Bank. Standard Chartered completed the integration of its Bangkok branch and Standard Chartered Nakornthon Bank in October, renaming the new entity Standard Chartered Bank (Thailand). Standard Chartered also formed strategic alliances with Fleming Family & Partners to expand private wealth management in Asia and the Middle East, and acquired stakes in ACB Vietnam, Travelex, American Express Bank in Bangladesh and Bohai Bank in China. On 9th August 2006 Standard Chartered announced that it had acquired an 81% shareholding in the Union Bank of Pakistan in a deal ultimately worth $511 million. This deal represented the first acquisition by a foreign firm of a Pakistani bank and the merged bank, Standard Chartered Bank (Pakistan), is now Pakistan's sixth largest bank. On 22 October, 2006 Standard Chartered announced that it has received tenders for more than 51 per cent of the issued share capital of Hsinchu International Bank (“Hsinchu”), established in 1948 in Hsinchu province in Taiwan. Standard Chartered, which had first entered Taiwan in 1985, acquired majority ownership of the bank, Taiwan’s -5-

seventh largest private sector bank by loans and deposits as at 30 June, 2006. Prior to the merger, Hsinchu had suffered extensive losses on defaulted credit card debt. In 2006, Standard Chartered in Bangladesh announced an alliance with Dutch Bangla Bank to share their respective ATM operations. On 23 August, 2007 Standard Chartered entered into an agreement to buy a 49 percent of an Indian brokerage firm (UTI Securities) for $36 million in cash from Securities Trading Corporation of India Ltd., with the option to raise its stake to 75 percent in 2008 and, if both partners agree, to 100 percent by 2010. UTI Securities offers broking, wealth management and investment banking services across 60 Indian cities. On 29th February 2008, Standard Chartered PLC announced it has received all the required approvals leading to the completion of its acquisition of American Express Bank Ltd (AEB) from the American Express Company (AXP). The total cash consideration for the acquisition is US$ 823 million. The acquisition of AEB provides Standard Chartered with an opportunity to add capability, scale and momentum in the strategically important Financial Institutions and Private Banking businesses. It will add 19 more markets to the Standard Chartered footprint, while deepening presence in some core markets and providing access to several new growth markets.

9.1 Position Today Today, the bank is a leading player throughout the developing world. Standard Chartered Bank is one of the three banks issuing banknotes for Hong Kong (Standard Chartered Bank (Hong Kong) Limited became a note-issuing bank from 2004), the other two being the Bank of China (Hong Kong) and The Hong Kong and Shanghai Banking Corporation. The bank supports marathons in many cities, including London (The City Run), Jersey, Singapore, Dubai, Lahore, Mumbai, Hong Kong, and Nairobi.

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10.

Standard Chartered Global Presence

The Americas

Africa

Asia

Middle-East

Europe



Argentina



Botswana



Afghanistan



Bahrain





Bahamas



Cameroon



Australia



Jordan





Brazil



Gambia



Bangladesh



Qatar



Canada



Ghana



Brunei



Colombia



Ivory



Cambodia



Mexico



Coast



China



Peru



Kenya



Hong Kong





US Venezuela

Nigeria

India





Sierra



Indonesia



Leone



Japan



South



Laos



Africa



Macus



Tanzania



Malaysia



Uganda



Mauritius



Zambia



Nepal



Zimbabwe

Pakistan





Philippines



Singapore



Sri Lanka

The Falkland(classifi ed as "Europe"



UAE

for Standard Chartered purposes) Ireland Jersey Turkey UK

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11.



Taiwan



Thailand



Vietnam

Standard Chartered Bank – Vision and Strategy

Standard Chartered Bank has been established for over 150 years. It spans the developed and emerging economics of the world with a network of over 500 offices in more than 40 countries. With a mission to build a world-class bank, Standard Chartered has adopted the strategies of: Building a world class business: Focus on core business, provide superior customer service, and generate maximum returns and benefits for shareholders. Staying lean and focused: Is vest in core business optimal usage of resource, and manage performance by balancing cost and risks. Recognized as a winning organization: Develop capability to the fullest, instill global thinking, inject of pride in to people to get connected to Standard Chartered Bank. The Standard Chartered Group is an unusual banking business. Although its roots are clearly British, its area of operations, its network and indeed its profit stream are overwhelmingly India.. The name Standard Chartered comes from the two original banks from which it was founded – The Chartered Bank of South Africa Australia and China, and the Standard Bank of British International

11.1 Principles & Values

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At Standard Chartered our success is built on teamwork, partnership and the diversity of our people. At the heart of our values lie diversity and inclusion. They are a fundamental part of our culture, and constitute a long-term priority in our aim to become the world's best international bank. Today they employ 73,000 people, representing 115 nationalities, and you'll find 61 nationalities among our 500 most senior leaders. We believe this diversity helps to fuel creativity and innovation, supporting the development of exciting new products and services for our customers worldwide.

11.2 Business & Strategy Standard Chartered operates in many of the world's fastest growing markets, and derives over 90 per cent of its profits from the emerging trade corridors of Asia, Africa and the Middle East. We want to be recognized across Asia, Africa and the Middle East for delivering a sustainable business and to lead by example in our markets."

11.3 Indian Operations The Chartered Bank opened its first overseas branch in India, at Kolkata, on 12 April 1858. Eight years later the Kolkata agent described the Bank's credit locally as splendid and its business as flourishing, particularly the substantial turnover in rice bills with the leading Arab firms. When The Chartered Bank first established itself in India, Kolkata was the most important commercial city, and was the centre of the jute and indigo trades. With the growth of the cotton trade and the opening of the Suez Canal in 1869, Bombay took over from Kolkata as India's main trade centre. Today the Bank's branches and sub-branches in India are directed and administered from Mumbai (Bombay) with Kolkata remaining an important trading and banking centre. Standard Chartered Bank is the largest international banking Group in India Standard Chartered offers a range of premium retail banking services through its network of 83 branches in 33 cities across the country, including Ahmedabad, Mumbai, Delhi, Chennai, Calcutta, Pune, Bangalore and Kanpur. As their privileged customer, you can always be assured of a banking service flexible enough to take care of your banking needs. These are in addition to their Savings account, depot account, current account and depository services facilities, which are also available. What’s more many of their services are backed by a unique service guarantee – a reflection of their commitment to provide you with effective and reliable banking services. Standard Chartered was -9-

the first to issue global credit card in India, the first to issue Photo card, the first Picture Card and was the first credit card issuer to be awarded the ISO 9002 certification.

11.4 Future Plans After 150 years of services to India, Standard Chartered Bank continues to be committed to the country and optimistic of positively contributing to the Indian Financial Sector. The Standard Chartered Group considers being one of the greatest economic opportunities of the 21st century and is proud to be so strongly positioned here. The Bank has ambitious plans to transform its business in the country and to further expand operations across the country.

12.

Objective of the Study

The Research project has been carried out to aid the Standard Chartered bank in offering services that the customer needs and also to improve on some of the existing services of the bank. The objective of this project was to find out: 1. To study Service Account potential in today’s market scenario as a whole. 2. To Analyze Market Potential of Standard Chartered Bank’s Services Account. 3. Comparing other banks with Standard Chartered on various banking parameters. 4. To find out the various factors on which the bank lags/leads. 5. Finally to find the requirement of the customer by segmenting them on the basis of: •

Age

•

Profession

•

Monthly Income

Analyzing the data as per the given objectives, reaching a conclusion and finally the factors that the bank should consider in case of improving the service accounts.

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13.

Purpose of the Study

To maintain and enhance the position further, the bank decided to have a thorough insight into the comparison with different banks. As it is a part of the service industry, which depends upon the customer perception of the product conception and their views towards the service provider, thus the feedback from the customers becomes important. The purpose of the undergone study was to study the Current/Saving Accounts services and its rates of different banks and evaluate the competitive position of Standard chartered so as to suggest ways to increase its market share.

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14.

Problems Definition

The main problem faced by the company was that it had a small customer base .The bank’s own products had a lesser market as compared to its third party selling. The bank does a third party selling for all the investment products. The study thus focused on the following dimensions: 1.To identify critical factors that influences the buying behavior of individuals. 2.To know the customer acceptance of the services of Standard chartered bank in Delhi and NCR regions. 3.To asses the problem volume of future sales. 4.To find the position of Standard Chartered bank vis-à-vis its competitors. The Bank wants to strengthen its customer base by gathering information about the market scenario for Current/Savings Accounts. Standard Chartered Bank needs to know about the competitor’s moves and the customer’s preference in this sector.

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15.

Literature Support

The Indian Banking system has seen sweeping changes over the years. In the short span of time that they have been in existence, the leading new private sector banks have truly revolutionized banking in India. There focus on technology and customer convenience has brought about a paradigm shift in the banking business. While Standard Chartered Bank today has built stable business that it believes will deliver sustainable value to its stake holders, there are also many existing opportunities for further growth. The Bank’s operation can be subdivided into the following categories:

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Fig 2

16.

Savings Accounts Product Offering

16.1

•

AXcessPlus Savings Account

•

SuperValue Savings Account

•

Parivaar Savings Account

•

2-in-1 Account

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•

Aasaan Account

•

No Frills Account

•

Debit Card

The main product of the bank is the Savings Accounts and its Insurance products.

Fig 3

1) Axcessplus Account Benefits of an aXcessPlus savings account are: •

Free Unlimited Visa ATM transactions

•

Free Standard Chartered Bank branch access across the country

•

Free Doorstep Banking

•

Free Demand Drafts/Pay Orders

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•

Free Payable at Par Cheque book

Eligibility •

Individuals, Clubs, Associations, Trusts, HUF’s, Minors

•

Resident Indians and Foreign Nationals

•

Can be opened in a single name or joint names (to a maximum of three individuals)

It is available on maintenance of average quarterly balance of Rs 15,000/ With this saving account customers can get instant cash at over 20,000 ATMs across India and over 10, 00,000 ATMs across the world through the Visa network. And customers also get a globally valid Debit Card that lets them shop at over 3, 26,000 outlets in India and at over 14 million outlets across the world. And that’s not all, with the aXcessPlus account they also get: •

International Debit Card

•

Phone Banking

•

Online Banking

•

Extended Banking Hours

2) Super Value Account: The unique SuperValue savings account from Standard Chartered is proof that the best things in life come free. With an average quarterly balance of just Rs 50,000, customers get a host of services from Standard Chartered absolutely free. Benefits of a SuperValue Account are: •

Free globally valid Debit-cum-ATM card

•

Free Access to at over 20,000 Visa ATMs in India

•

Free Doorstep Banking

•

Free Payable at Par cheque book/ account statements

•

Free Inter Bank Funds Transfer

•

Free Foreign Inward Remittance Certificates

With the SuperValue Account customers also get: - 16 -

•

Multicity

Banking

access

accounts

even

when

customers

are out of town •

Enjoy extended Banking hours at all their branches, and Speed Cheque Clearing and Metro Clearing facilities

•

24-hour branches, 365 day branches available at select locations

•

Phone banking - available to the customers 365 days a year on a 24-hour basis in the metros and everyday of the week at other centers

•

Online banking - access and transact on accounts through the Internet from any part of the world

•

Free Investment Advisory Services to assist the customers in investing in a range of mutual funds

•

Full suite of complimentary banking services including credit cards, loan products and capital market services

3) No Frills Account: The Standard Chartered Bank No Frills Account is designed to meet basic banking requirements. Customers need to maintain an average quarterly balance of just Rs. 250 with this account. Here are some of the unique features available on No Frills Account: •

Low Average Quarterly Balance of Rs. 250

•

ATM card & Debit Card available

•

4 free transactions per month at any Standard Chartered

Bank channel (Online Banking,

Phone Banking, ATM & Branch) •

Anywhere banking – Access accounts from any branch of Standard Chartered Bank

•

Access to Phone Banking and Online Banking

•

Free Cheque deposit at any SCB Branch or ATM

Eligibility Criteria

- 17 -

This account is available to individual Resident Indian customers. The Standard Chartered Bank No Frills account can be opened after being properly introduced in a manner approved by the Bank. 4) Parivaar Account: Parivaar is a unique Wealth Management Solution from Standard Chartered Bank that offers family flexibility, convenience and essential tools for wealth accumulation and preservation. Parivaar is much more than a regular Savings Account. It allows customers to maintain individual identity while allowing them to tap their family's financial strength. Here are some of the features of the Parivaar savings account: •

Family can maintain individual savings accounts with the benefit of clubbing balances in grouped accounts.

•

Anytime, anywhere access to accounts through ATMs, Phone Banking and Online Banking.

5) 2-In 1 Account: It lets the customers earn the high interest rate of a fixed deposit while customers enjoy the flexibility of a savings or current account.

The Double Advantage Exclusive benefits of a 2 in 1 account are: •

Earn fixed deposit interest rates

•

Enjoy the flexibility of a Savings or a Current Account

•

Get a free personalized cheque book and Debit/ATM card

•

Withdraw money whenever customers need it

•

Deposit more money in the account to earn a higher rate of interest by placing subsequent deposits

•

Get account related information at fingertips with Phone Banking

6) Aasaan Account: Exclusive benefits of an aaSaan savings account are: •

No Minimum Balance requirement

- 18 -

•

Free unlimited access to any SCB branch across the country for Customer-in-person

•

Unlimited Free access to Standard Chartered Bank ATM's

•

Up to 4 free cash withdrawal transactions per month at other domestic VISA ATMs

•

Nominal quarterly fee of Rs. 100 (reversed if the Average Balance in the quarter is Rs. 10,000 or more)

•

Complete control over your banking requirements:

o

International Debit Card

o

Phone Banking

o

Online Banking

o

Extended banking hours

o

Locker facility

o

Doorstep Banking

16.2 Other services 16.21 Phone Banking 

Customer Request



Account balances and TXN history



Other account information like interest rate on deposits, maturity date, tenor of deposit etc.



Loan and deposit product enquiry



General Enquiry



ATM related enquiry



ATM functioning guidance



ATM malfunction escalation



Basic product service related information like fees and service charges.

16.22 Any Branch Banking  All branches across the SCB & SCGB network connected on a common backbone.  Branch customer to bank customer.  Accounts can be accessed from any branch.

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 Withdraw cash or transact from any branch.

16.23 Investment Advisory Services •

Investment advisors at various location will advice customers on how to get the maximum return on their investment.

•

Advice them on alternate channels of investments ; Own and Third party mutual funds.

•

Increase fee based income.

16.24 Bulk Cash Services  Targeted at customer transaction in larger volumes of cash.  Cash will picked up from the customers premises and will be accepted on subject to account basis.

16.25 Call Centres  24 hr a days 365 days a year.  Increase customer convenience  Reduce transaction costs  Enable customer to transact on their bank account over the phone rather than physically coming to bank.

16.26 Door Step Banking •

Increase customer convenience

•

Reduce traffic at branches and migrate them to alternate channels of distribution.

•

Generate fee income for the bank

16.27 Off Site Cheque Deposit Boxes  Cheque deposit boxes are placed at convenient locations all over city.  The boxes will be cleared daily and cheques will be sent for clearing.

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17.

1.

Parameters Taken for the Comparison and Analysis

Branches - 21 -

2.

ATM’s

3.

Cheque Deposits box

4.

Banking Hours

5.

Average Balance quarterly

6.

Global Debit card

7.

ATM Cash Withdrawal(per day)

8.

Statement Charges

9.

24 Hours Branch Banking

10.

365 days Banking

11.

Phone Banking

12.

Automatic Cheque Book Recorder

13.

Any Branch Banking

14.

National Clearing

15.

Speed Clearing

16.

Investment Advisory Services

17.

Net banking

18.

Mobile banking

19.

Demat

20.

Overdraft

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S.NO.

Parameters

Standard

ABN

Chartered

AMRO

HDFC

Kotak Mahindra

ICICI

1.

Branches

10(Delhi)

3 (Delhi)

63(delhi)

17 (Delhi)

52 (Delhi)

2.

ATM’s

38 (Delhi)

18

460 (India)

28 (Delhi)

115 (Delhi)

(Delhi) 3.

Cheque Deposit Box Yes

Yes

Yes

YES

Yes

4.

Banking Hours

10am-7

10am-

10am-4pm

9am-6pm

8am-8pm

pm

7pm

(i)Axcessplus

10000/-

-

-

-

-

(ii)Parivaar

25000/-

-

-

-

-

(iii)Value added

-

10000

5000

10000

5000

50000/-

50000/-

-

50000/-

-

Yes

No

Yes

Yes

Yes

Free Quarter

Free Quarter

Free Quarter

Free Monthly

No

No

No

No

5.

Average Quarterly balance

Savings Account

(iv)super

value

added Global debit 7.

Card Free Quarter

8.

Statement Charges

9.

24 Hours Banking

Yes

- 23 10.

365 days

Yes

Yes

No

No

No

18.

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Survey

TO KNOW THE BEHAVIOR OF THE INDIVIDUALS WHO ARE OPENING AN ACCOUNT WITH THE STANDARD CHARTERED BANK.

19.

Objective of the Survey

- 25 -

The following survey was mainly done with an objective to know the state of mind of an individual who is opening a saving account with STANDARD CHARTERED BANK. •

To know which all others bank are key players.

•

Features and services that influences the customer while he / she is into opening an account with a bank.

•

The Market Potential of Standard Chartered Bank’s Services Account

•

Comparing other banks with Standard Chartered on various banking parameters

20.

Methodology

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Process adopted: 1. Gaining knowledge about the product: Reading about the product was the first step undertaken. This gave not only in depth knowledge about what is been offered by the bank but also proved useful while developing the questionnaire. 2. Steps in the Development of the Survey Instruments The main instruments required for survey was a well-developed questionnaire. 1. Customer Survey: The people play an important part as a clear perception of people about the product can be estimated and known. Studying the need levels of the people regarding the banking product can be observed. It was very useful in knowing about the requirements of the people. 2. Referred to brochures and websites of competitors: To understand the competitors product brochures and websites of various banks were referred and a competitive analogy of all the rates and necessary features of the Savings account is been made.

20.1 Research Design: A two stage Research was conducted: - 27 -

1. Secondary Research: Data was collected from websites and catalogues to understand the product and the charges of the different banks. 2. Primary Research: A Primary Research was conducted. The questionnaire was prepared for the companies and following areas covered: •

Competing Banks

•

Features offered by different banks

•

Consumer profile

•

Satisfaction level with the current bank

•

Reason for the selection of specific Bank

•

Desirable features of the product

Sampling Plan: Elements: The target population of the study included the general population above the age of 18 yrs. Time: 06 May- 30 June, 2009 Sample size: 82 people

21.

Data Collections

- 28 -

Data Collection Plan: The first of Research consisted of secondary data search from the following sources: •

Catalogues

•

Websites

In this, information about different banks, different features the banks are offering to employees under salary accounts and general market standing of different banks were collected. For the conclusive research, questionnaires were developed on the basis of secondary data to gather information on the research objective. The final draft of the questionnaire (see Appendix) was then prepared on the basis of the observations from the pilot study. These were then finally filled by 50 consumers, for the conclusive study.

22.

Analysis Percentage of Respondents with Reference to AGE Group - 29 -

Chart2:- Percentage of Respondents with Reference to AGE Group

43% of the respondent who responded lies in the age group of 20-30yrs. 23% of the respondent who responded lies in the age group of 31-40yrs. 13% of the respondent who responded lies in the age group of 41-50yrs. 06% of the respondent who responded lies in the age group of 51-60yrs. 15% of the respondent who responded lies in the age group of more than 60 yrs.

- 30 -

Chart3:- Number of respondents under Standard Charted According to a survey conducted it has been found that 50% of the respondents under Standard Chartered are of the age group 20-30yrs. 12% of the respondents under Standard Chartered are of the age group 31-40 yrs. 25% of the respondents under Standard Chartered are of the age group 41-50yrs. 13% of the respondents under Standard Chartered are of the age group 51-60yrs No respondent of age group greater than 60.

- 31 -

Total Number of Respondents Divided on the Basis of Occupation

Chart 4:- Total number of respondents divided on the basis of occupation

It is seen that maximum number of respondents belong to service group and very less of them belong to business and retired group.

- 32 -

Percentage of Respondents with Reference to Income Group

Chart 5:- Percentage of Respondents with Reference to Income Group

25% of the respondent have income 10 lac & above. 33% of the respondents have income 5-10lac. 40% of the respondents have income 3-5lac. 2% of the respondents have income below 1-3lac.

- 33 -

Total No. of Respondents & Among Them Who are Using Standard Chartered Bank

Chart 6:-No. of respondent who are using standard chartered bank

Out of the 16 respondent of income 10 lacs & above,1 respondent uses Standard Chartered. Out of the 21 respondent of income 5-10lakhs,2 respondents use Standard Chartered. Out of the 25 respondent of income 3-5lakhs & above,3 respondents use Standard Chartered. Out of the 1 respondent of income 1-3 lakhs,0 respondents use Standard Chartered.

- 34 -

Chart7:- Various banks with which people have accounts

ANALYSIS- The percentage respondents with reference to bank they use. According to this graph the maximum number of users of bank they prefer is other like government or public bank because of high charges of private bank. And in private bank the most preferred bank is ICICI and HDFC and rest share is very low.

- 35 -

Type of Account

Chart8:- Different types of account which different respondents have.

Out of the total respondent,6% uses current account. Out of the total respondent,37% uses Salary account. Out of the total respondent,52% uses Saving account. Out of the total respondent,5% uses other accounts.

- 36 -

Investment Preferred by People

Chart9,10:- User preference investment options ANALYSIS- This analysis shows that maximum people goes for bank deposit. Real estate and share and debentures have equal percentage 16%, followed by ULIP and then rest of the investment afterwards.

- 37 -

Reason Why the Respondent Go for a Particular Bank

Chart11:- Investment reason for number of respondents

Out of total respondent 19 choose there bank because of brand name. 48 went on the basis of expected returns. 1 was keen because of reviews in the magazine. 14 out of total because of risk profile.

- 38 -

Consideration of People for Having an Account (Saving, Salary, Current, Others) In Any of the Bank.

Chart12:- Consideration for number of respondents

Out of the total respondent,8% had consideration for building home. Out of the total respondent,13% had consideration for child education. Out of the total respondent,15% had consideration for future contingencies. Out of the total respondent,9% had consideration for pension. Out of the total respondent,32% had consideration for tax saving. Out of the total respondent,23% had consideration for wealth creation.

- 39 -

Type of Risk Takers on Basis of There Age

Chart13,14:- Type of risk taker on the basis of age ANALYSISModerate risk takers are max. of age 20-30, from age of 31-50 the no. of moderate risk takers are constant and the no. decline at the age of 51-60 and is least for people who are above 60 years. Low risk takers are also highest at age of 20-30 and are almost constant from age 31-50, the graph shows a little decline from age 51-60 and it again rises for people who are above 60 years. High takers are less at the age segment of 20-30 years they rise and is max. at the age b/w 31-40 then becomes zero from 41-60 and again rise for respondents who are above 60 years.

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Type of Investors On the Basis of There Age

Chart15:- Type of investors on the basis of their age

In every segment of age group short term investor are less than long term investors. Long term investors are max. at age group of 20-30 followed by age group of 31-40. Whereas short term investors are max. for investors who have age greater than 60 years.

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Chart16:- Investment option on the basis of age group ANALYSISFor LIC highest no. of investors are of age group from 20-30 and very less from age group 3140, zero of rest of the age groups. For Shares & Debentures max. are of 31-40 years followed by people from 41-50 years. For Real Estate 20-30 years group max. & 31-60 constant. For ULIPS max are from age of 20-30 years. For Bullions very less respondents are there and they also of age group of youngest and oldest. Mutual funds is used by people from 20-50 years of age group for investment. Among them 3140 years group has max. respondents. Bank Deposit is used by 20-30 years followed by above 60 years respondents. Post Office is used as investment option max. by older people followed by people of age group from 41-50 years.

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Chart17:- Bank preference on the basis of age

Max. people of all age group goes towards other banks, mainly government banks. Among that highest is of 20-30 years. HDFC bank & ICICI bank is preferred more than STANDARD CHARTED & KOTAK MAHINDRA banks. 20-30 years of age group people show more interest for SC bank than other age groups

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DATA COLLECTION METHOD My project was to compare the products offered by different banks with SCB. I used both secondary and primary data. That includes internet and journals and news paper. DATA COLLECTION INSTRUMENT A semi structured kind of questionnaire was designed which contain both open ended and multiple choice questions. The questionnaire designed was to provide dual information sharing type, it is seriously undertaken that anyone who in undergoing the process, should find his interest or else he might show disinterest towards the programme. The awareness program provided all those filling up of the questionnaire with enough information about the services of the Standard Chartered Bank. Thus the questionnaire was equally important both ways to the customers as well as to the bank to draw out its prospects. For those already holding a relationship with SCB, shared with me their opinion about the bank and its services as well as suggestions were also obtained from them of how to attract more customers for the bank. FIELD WORK PLAN The field work was carried according the sampling plan formed. I visited the offices and firms under my own limitations and time constraint at the following places. a. NFC b. Bawana c. Noida The main motive of these visits was to identify the potential customers or the potential market. A two way discussion was done through whish the customers were made aware of the services of SCB. The questionnaires were directly and indirectly filled up by the people through this as well as the prospect of the areas as such were these campaigns were put up.

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SWOT Analysis of Standard Chartered Bank

23.

STRENGTHS • • •

Strong Brand Image Dedicated sales team Value added services.

WEAKNESSES • • • • •

Rigid Eligibility Criteria Weak Customer Relations Management Centralized Structure High Average Quarterly Balance Limited number of ATM’s and Branches. Poor network.

OPPORTUNITIES

•

• Large Untapped Market. • Distinguishable product (like • Parivaar Account).

THREATS Presence of very strong competitors. Aggressive marketing by competitors. Various investment Schemes with high returns.

23.1 SWOT Analysis In Detail

STRENGTHS •

Market position is strong

•

Aggressive foreign bank

•

Shareholders return has grown more than 7 times

•

Maintains a position as a leading Asian Cash Management provider

•

Brand – SCB’s modern and dynamic look appeals to the growing middle income earners

•

One of the most profitable MNC in India

•

Improved product proposition

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•

Better geographic balances

•

Multi-cultural organization that offers opportunities to good managers

WEAKNESSES •

HDFC, ICICI, ABN-AMRO, Citibank and HSBC are dominant players

•

Has disadvantage due to not first mover (entry)

•

Fewer locations as compared to other MNC banks

•

Service delivery perception is weak

OPPORTUNITIES •

Branch expansion for rapid growth

•

Increase focus on value creation in whole banking

•

Improve shareholders return

•

Build market share in consumer banking as consumer banking continues to offer highest potential for growth

•

Broadening of the demographic base

•

Tie ups with master card networks

•

Integrated sales and service approach

•

Can offer a complete corporate package into under proposed corporate relationship

THREATS •

HSBC pitching is quite aggressively

•

Citibank is expanding in new markets

•

Competitive products and offers from ICICI and HDFC

•

Proposed networking of all branches in next 6 months

•

Reduced business in OECD business

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24.

Recommendations

Strong Need of Brand Buildings The bank needs to make a lot of marketing effort. The level of recognition that may be desired by any brand has not been achieved by Standard Chartered Bank, Delhi. A lot of noise is made whenever a child is born and as long as that noise is not made the doctors is not sure about the life of that child. Same is the case in marketing. Whenever a new branch comes into existence it is necessary that they announce their birth. Here comes the pre-launch exercise, and similar is the case after the birth. The name has to be taken again. Boast about yourself, about the strong points that you have over and above your competitors. Pull the consumer towards you. As said earlier it is a relationship of trust and this trust can be generated through better and better performance of the bank. Now as working with the bank for some time the facts has come out that they believe in low costing and want to keep low profile. So better way of marketing can be sought which are low at cost. These are discussed further. Need A Change In Marketing Focus The marketing team of the branch has until now focused on selling of their most competitive product, which are there fixed deposits. The rates of interest, which they provide on fixed deposits, are really competitive and highest in this market. But this strategy could not be held for a longer period of time as in the long run it would become liability to the bank to pay such high rate of interest and it would lower the revenues of the branch. Even the survey conducted proved that the fastest selling product is savings account amongst the consumer. With a network that is good enough this bank can make efforts to increase the market share in the area where the competition is so thought. This needs a brain storming from the top management in the branch as to how about fixing the targets in each category of accounts. Solid Network Required to Develop the Business Further If we see the results of the survey, it is evident that people prefer strong networking system to make their banking life as comfortable and reachable as possible. For Standard Chartered Bank to enjoy a good customer base, they should make efforts towards developing more and more

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ATM in the city and extension counters to facilitate better and fast service. Updating of technology from time to time is very necessary. Standard Chartered Bank was the very first bank to start few of the very good service like Internet banking; bringing about new service to attract more and more consumers should carry on this tradition further. Corrective positioning of Standard Chartered Bank. Standard Chartered Bank is known for its corporate operations. Very big names in the corporate world have their accounts with this bank. For the past so many years it has been catering to these clients only and has generated an image of being a corporate bank. This product extension into the retail segment need separate focus and separate positioning in the market. The bank cannot carry on its old image for both the segments of the market. For this a distinctive advertising campaign has to be developed (refer to the promotional activities stated earlier) to reposition the brand in potential consumer’s mind. It should be noted that both the type of clients differs from each other in their true nature. One is a very low profile relationship, which talks about masses. This type of client requires assurance, trust, information, and support. This is retail banking. While on the other hand the second type of relationship is stronger, which is the corporate client that requires different set up all together. Services Like ATM & Phone Banking Should Be Encouraged. Promotional Strategies Press publicity •

Paper inserts

•

Advertisements in newspaper (local and national).

•

Interest cards distribution

•

Mailers / personal invitations to selective section of the society

•

Leaflets

Outdoor publicity •

Banners in commercial areas and prime sites.

•

Air balloons at shopping complex.

•

Bus stands shelters.

•

Off site ATM for developing business - 48 -

•

Advertisements on Dividers and Railings.

Media •

Local channel advertisement (cable TV scrolls)

•

Advertisements in news channels and business channels

Face to face •

Personal interaction of marketing executives through

•

Meetings

•

Detailing about schemes and updating them from time to time

•

Event sponsoring in local clubs and social gathering

•

Road shows

•

Contacting senior citizens in parks in morning and evening

•

Contacting office goers in the morning and evening at stop lights by distribution of interest cards.

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25.

Conclusion

To conclude, it can be said that the research findings clearly reveal the goodwill and reputation of the bank among the customer. But there is a need to strengthen the bank by spreading awareness about the services offered by Standard Chartered bank through advertisement and by expanding the branches of the bank all over the country and also by tapping the potential customers through innovative means.

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26.

ULIP-Unit Linked insurance Plan

ULIP is an abbreviation for Unit Linked Insurance Policy. A ULIP is a life insurance policy which provides a combination of risk cover and investment. The dynamics of the capital market have a direct bearing on the performance of the ULIP’s. It provides for life insurance where the policy value at any time varies according to the value of the underlying assets at the time. ULIP is life insurance solution that provides for the benefits of protection and flexibility in investment. The investment is denoted as units and is represented by the value that it has attained called as Net Asset Value (NAV). ULIP came into play in the 1960s and is popular in many countries in the world. The reason that is attributed to the wide spread popularity of ULIP is because of the transparency and the flexibility which it offers. As times progressed the plans were also successfully mapped along with life insurance need to retirement planning. In today’s times, ULIP provides solutions for insurance planning, financial needs, financial planning for children’s future and retirement planning. These are provided by the insurance companies or even banks. Investments made in ULIP has tax exemption under section 80C of the Indian Income Tax Act, 1961 and also returns will be covered under section 10(10D). Most insurers offer a wide range of funds to suit one’s investment objectives, risk profile and time horizons. Different funds have different risk profiles. The potential for returns also varies from fund to fund. ULIP provides multiple benefits to the consumer. The benefits include: •

Life protection

•

Investment and Savings

•

Flexibility

•

Adjustable Life Cover

•

Investment Options

•

Transparency

•

Options to take additional cover against

•

Death due to accident

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•

Disability

•

Critical Illness

•

Surgeries

•

Liquidity

•

Tax planning

Market linked insurance plans invest the premium in to the equity, debt and cash markets by the way of allocating units, which like any other mutual fund have a NAV and the customer is free to switch between one fund class to another depending on the risk factor he wishes to be in. ULIP’s offer a better return than the traditional endowment plans and offer a great deal of flexibility along with great returns making them the finest product offering. Charges: ULIP’s offered by different insurers have varying charge structures. Broadly, the different types of fees and charges are given below. However it may be noted that insurers have the right to revise fees and charges over a period of time. 1 Premium Allocation Charge This is a percentage of the premium appropriated towards charges before allocating the units under the policy. This charge normally includes initial and renewal expenses apart from commission expenses. 2 Mortality Charges These are charges to provide for the cost of insurance coverage under the plan. Mortality charges depend on number of factors such as age, amount of coverage, state of health etc 3 Fund Management Fees These are fees levied for management of the fund(s) and are deducted before arriving at the Net Asset Value (NAV). 4 Policy/ Administration Charges These are the fees for administration of the plan and levied by cancellation of units. This could be flat throughout the policy term or vary at a pre-determined rate. 5 Surrender Charges A surrender charge may be deducted for premature partial or full encashment of units wherever applicable, as mentioned in the policy conditions.

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6 Fund Switching Charge Generally a limited number of fund switches may be allowed each year without charge, with subsequent switches, subject to a charge. 7 Service Tax Deductions Before allotment of the units the applicable service tax is deducted from the risk portion of the premium. Investors may note that the portion of the premium after deducting for all charges and premium for risk cover is utilized for purchasing units.

26.1 ULIP – Standard Chatered The flexible Unit linked life insurance plans at Standard Chartered bank provides the opportunity to participate in market-linked returns while enjoying the valuable benefits of life insurance. Insurance Plans for Standard Chartered Bank customers is issued by Bajaj Allianz Life Insurance Company Limited.

Bajaj Allianz Bajaj Allianz Life Insurance Company Limited is a Union between Allianz SE, one of the world’s largest Life Insurance companies and Bajaj Auto, one of the biggest 2- &- 3 wheeler manufacturers in the world. Allianz SE is a leading insurance conglomerate globally and one of the largest asset managers in the world, managing assets worth over a Trillion Euros (Over R. 55, 00,000 crores). Allianz SE has over 115 years of financial experience in over 70 countries. Bajaj Auto is one of the most trusted name is Indian auto for over 55 years. At Bajaj Allianz customer delight is our guiding principle. Ensuring world-class solutions by offering customized products with transparent benefits, supported by best technology are our business philosophy. Market linked insurance plans invest the premium in to the equity, debt and cash markets by the way of allocating units, which like any other mutual fund have a NAV and the customer is free to switch between one fund class to another depending on the risk factor he wishes to be in. ULIP’s

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offer a better return than the traditional endowment plans and offer a great deal of flexibility along with great returns making them the finest product offering. We at Bajaj Allianz Life Insurance have developed a number of ULIP products which range from single premium to a regular premium option along with investment funds ranging from index funds to mid-cap funds and debt market linked funds. CAPITAL UNIT GAIN – A UNIT LINKED PLAN: Capital Unit Gain is a unit linked endowment regular premium plan with the benefit of life protection offered by Bajaj Allianz. By choosing an appropriate premium level and term, individual can match the maturity date of the plan to a specific savings need such as child’s education, wedding, retirement etc. It has unmatched flexibility to meet any emergency or any financial need. Bajaj Allianz Capital Unit Gain gives up to 97% allocation from the first year onwards to ensure that the investment income gets accelerated from the first year itself. With Bajaj Allianz Capital Unit Gain one can get to choose from a wide range of high quality investment funds coupled with flexible investment management. This is the one-stop solution to investment, tax-saving and protection needs. The Key Features of the Capital Unit Gain Plan are: • Option of choosing any sum assured between minimum and maximum limits to match insurance needs. • Option of choosing from a host of additional rider benefits: UL Accidental Death Benefit, UL Accidental Permanent Total/Partial Disability Benefit, UL Critical Illness Benefit and UL Hospital Cash Benefit • Increase savings by paying top up premiums. • Same premium allocation for all policy years with higher allocation for top up premiums. • Individuals choice of adopting own investment strategy to grow the funds under the policy. • Choice of 5 investment funds with flexible investment management, with the option of changing funds at any time and also invest in the newer funds that would be introduced from time to time. • Partial withdrawals without any surrender charges.

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• Flexibility to increase / decrease the regular premiums Regular Premium Market linked insurance plans invest the premium in to the equity, debt and cash markets by the way of allocating units, which like any other mutual fund have a NAV and the customer is free to switch between one fund class to another depending of the risk factor he wishes to be in. ULIP’s offer better returns than the traditional endowment plans and offer a great deal of flexibility along with great returns making them the finest product offering. Bajaj Allianz Life Insurance have developed a number of ULIP products which range from single premium to a regular premiums option along with investment funds ranging from index funds to mid-cap funds and debt market linked funds. 1) New Unit Gain Super: Ensure fully and get MAX allocation along with a host of additional benefits to choose from. A flexible

unit

linked

plan

that

allows

partial

&

full

withdrawal

after

3

years.

Additional benefits: •

UL Accidental Death Benefit and UL Disability Benefit.

•

UL Critical Illness Benefit and UL Hospital Cash Benefit.

•

3 funds to choose from & flexibility to pay top-up any time.

2) Unit Gain plus Gold: A Unique plan with the combination of protection and prospects of earning attractive returns with investments in various mixes of securities that makes a perfect plan to last you a lifetime of prosperity and happiness. High Allocation upto 85%. Guaranteed Life Cover with a choice of 6 Investments Funds Additional Benefit Riders: •

UL Accidental Death Benefit.

•

UL Critical Illness benefit.

•

UL Hospital Cash Benefit.

•

UL Family Income Benefit.

•

UL Waiver of Premium benefit

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3) New Family Gain: A Flexible Investment plan with Pure Stock Fund- (a unique ethical fund that invests in environment responsive companies and also suits religious guidelines.) Additional benefits: •

Guaranteed Life Cover: Sum Assured + Value of Units.

•

Partial and full withdrawals after 3 years.

•

UL Accidental Death Benefit and UL Accidental Permanent Total/Partial Disability benefit.

•

UL Critical Illness Benefit and UL Hospital Cash Benefit.

•

UL Family Income benefit and UL Waiver of Premium Benefit

4) New Unit Gain Plus: Flexible investment plans with an option of withdrawing money whenever needed. Additional Benefits: •

Guaranteed life cover.

•

Choice of 5 investment funds.

•

3 free switches allowed every year.

•

Partial and full withdrawals after 3 years.

•

Unmatched flexibility to meet your changing lifestyle and insurance requirements.

5) Century Plus: A limited premium payment term option with a unique combination of protection and attractive returns. Additional benefits: •

98% allocation in year 1 and year 2 and 100% allocation 3rd year onwards.

•

Guaranteed life cover with twin-benefits of sum assured plus fund value.

•

Get Loyalty Units of 7% annualized premium from sixth year onwards.

•

Additional 0.25% Loyalty Units on regular premium fund value for annual premium equal to or above Rs. 1 Lac

6) New Unit Gain:

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An investment plan that creates value for every rupee invested. 7) Young Care: Bajaj Allianz Young Care offers a unique way to reassure that the customers have taken care of the ones they cherish. This investment plan is a Gift of a lifetime to the loved one, as it offers a guaranteed Sum Assured and continued pay premium on your behalf, in case of your unfortunate death. 8) Young Care Plus: Bajaj Allianz Young Care Plus offers a unique way to reassure that the customers have taken care of the ones they cherish. This investment plan is a Gift of a lifetime to loved ones, as it offers a guaranteed Sum Assured, continued pay premium on their behalf, in case of one’s unfortunate death and critical illness benefit 9) Single Premium: Unit Linked Single Premium Plans require the premium to be paid only once. 10) New Unit Gain Premier SP: New Unit Gain Premier SP is an unique insurance cum investment plan that provides investment a zing from the start, by allocating 105% of the single premium paid from day one, thereby ensuring that you get MORE. Additional benefits: •

105% allocation.

•

Guaranteed life cover.

•

Flexible withdrawal option u/s 10 (10) D

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27. Bibliography

Websites: 1. www.standardchartered.com 2. www.icici.com 3. www.abnamro.com 4. www.kotak.com 5. www.hdfcbank.com

Personnel: 1. Mr. Nitish Dipankar

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28. Annexures

ANNEXURE 1: COMPARATIVE ANALYSIS OF SAVING ACCOUNTS OF DIFFERENT BANKS : D:\internship\ankit stan C.xls

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Annexure 2: Questionnaire

QUESTIONNAIRE

Sl.No.

Date : ___ /06 /2009

Dear Sir/Madam, We the students of MBA (M&S) 08-10 of AMITY BUSINESS SCHOOL (NOIDA) , are conducting a survey for our project. We assure you that the information provided by you would be kept confidential. We would be obliged to you for your co-operation in responding to the following questions:

Name:-________________________________ Gender: - Male / Female Occupation:- Service__/ Own Business__/ Income:____________________

Age:- _________ Retired__

Annual

Q1): Which type of investment do you prefer ? a): Short term (1year or less than a year) ___ b): Long term (more than 1 year) ____ Q2): How much risk are you willing to take? a): High (Risk taker) b): Moderate (Risk taker) c): Low (Risk averse) Q3): Which among the following investments options you like the most (Rank them from 1-8, 1 for first choice) ___ Bank Deposit Schemes ___Post Office Schemes ___Real Estate ___Bullions (Gold/silver) - 60 -

___ Shares & Debentures ___ ULIP ___ LIC Policies ____ Mutual Fund Q4): In which of the following banks do you presently have an account? ( NOTE:- Can tick more than one if applicable) a): Standard Chartered b): Kotak Mahindra C): ABN AMRO d): HDFC e): ICICI f): Others Q5): Which type of accounts do you have ? ( NOTE:- Can tick more than one if applicable) a): Current account b): Saving account c): Salary account d): Other Q6): Which factor influences you the most while investing in a company or bank? a): Brand Name b): Expected Returns c): Reviews in financial magazines d): Risk Profile Q7): What would be your major consideration for investment ? a): Children education / marriage b): Building dream home c): Tax saving d): Future contingencies e): Pension plan f): Wealth creation g): Others (Please mention) Q8): Have you ever used any service of Standard Chartered before ? Yes____ No____ Q9): Rank the following attributes of Standard Chartered. ATTRIBUTES Excellent Satisfactory Unsatisfactory Loan facility Interest rate Security of money Customer Care Good network Personalize services Q10): Your recommendations for Standard Chartered Bank regarding product / services._______________________ ___________________________________________________________________________ ________________

THANKYOU!

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