Scb - Prakash

Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

A PROJECT REPORT On Study of Saving Account in Standard Chartered Bank & Comparative Analysis of its with Some Private Leading Banks Submitted to:Nitish Dipankar Area Sales Manager Standard Chartered Bank New Friends colony New Delhi

Submitted by:Prakash Kumar Soni MBAL1S2, Sec – C (2007 – 09)

In partial fulfilment for the award of the degree Of

Master of Business Administration In

Marketing

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Acknowledgement

First of all I want to thanks the almighty God, who give me the courage to complete this project successfully. Completing a project is never one sided approach. I would like express my deep sense of gratitude to Mr. Praveen Puri (Director, Skyline Business school) who provided me the opportunity to work with the organisation. I am also thankful to my college faculty because without them support I would not able to complete this project. I am grateful to Mr. Nitish Dipankar, my company guide at Standard Chartered Bank without whose co-operation it was impossible for me to undertake the project. He guided me at all points of difficulties and put his best of efforts to solve them. He provided us with all the resources available to him to make our project interesting and invaluable. I would also like to thank the other staff members at the organization for their kind co-operation during my training period. Last but not the least I would like to thank my parents , friends , and family members without whose support and encouragement it was impossible for me to complete the project.

In a nutshell I express my heartfelt gratitude towards all those mentioned earlier and to those I have missed. Any error is greatly apologized.

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Table of Content Particulars

Page No.

1.

Executive Summary

5

2.

Introduction of Banking

6-9

2.1 What is banking?

6

2.2 Banking Sector in India

7

2.3 Some foreign banks in India

8

2.4 Banking as an opportunity

9

Company profile

10 - 17

3.1 History of Standard Chartered Bank

10

3.2 SCB in India

11

3.3 Some other facts of SCB

12

3.4 Principle and Values

12

3.5 SCB stands for

13

3.5 Product and Service

14 - 16

3.6 Types of Saving Account

16 - 17

Saving Account

18 - 19

4.1 RBI Guidelines

18

4.2 Features

18

4.3 General requirement

19

3.

4.

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Saving Account in SCB

20 - 24

5.1 aXcess Plus

20

5.2 Super Value

21

5.3 Parivaar

22

5.4 2 –in – 1

22

5.5 Service charges

23 - 24

6.

Insurance

25 - 26

7.

Unit Linked Insurance Product

27 - 28

8.

Bajaj Allianz Life Insurance Co.Ltd.

29 - 31

9.

Mutual Funds

32 - 42

5.

10. ULIP

Vs Mutual Funds

11. Taxation

43 - 44 45 - 48

12. ABN-AMRO

Bank

49 - 57

13. HDFC

Bank

58 - 62

14. ICICI

Bank

63 - 68

15. Service

charges of SCB & other Banks

16. Survey

69 - 70 71 - 81

16.1 Objective

71

16.2 Research Methodology

71

16.3

Survey Analysis Skyline Business School, Gurgaon

72 - 81 4

Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

17.Conclusion

82

18. Limitation

83

of Project

19. Bibliography

84

20. Annexure

85

1. Executive Summary The aim of project is study of different types of saving account, analyse the market potential of saving account and comparison with the other private leading banks. It is also focused towards creating a backup database which could be used by the organization towards interest of the services of the saving account. Since the project aims at analyzing the market potential and wants to know that whats people want in using the saving account service, a direct Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

survey was conducted in Delhi and NCR region. The sample size of the population was 60. People in the age group 20 and above and income group ranging from 2.5 lakhs and above were targeted for the survey process. Secondary data from internet, newspapers, and magazines were also collected for better interpretation of the results. In this also a detailed and systematic study of various investment options like ULIPs and Mutual Funds was done. It also includes comparative analysis between ULIPs and Mutual Funds. The process of taxation was also studied. This study covers the study of tax slabs for various categories of people and a comparative study of tax payment in the FY 06-07 and the FY 07-08. The results were then analyzed in excel with the help of different types of charts and graphs (bar, line, and pie graphs). Final analyses were then carried out based on these graphs and charts. One of the inferences that were drawn from the analysis was that none of the income and age categories of people wanted to use new bank service like internet banking, doorstep banking, mobile banking, online banking etc. People were also concentrated about how much wide ATM network s bank has. The new generation are paying much attention on services and brand name of the organisation.

2. Introduction of Banking 2.1 What is banking? Banking, the business of providing financial services to consumers and businesses. The basic services a bank provides are checking accounts, which can be used like money to make payments and purchase goods and services; savings accounts and time deposits that can be used to save money for future use; loans that consumers and businesses can use to Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

purchase goods and services; and basic cash management services such as check cashing and foreign currency exchange. Four types of banks specialize in offering these basic banking services: commercial banks, savings and loan associations, savings banks, and credit unions. A broader definition of a bank is any financial institution that receives, collects, transfers, pays, exchanges, lends, invests, or safeguards money for its customers. This broader definition includes many other financial institutions that are not usually thought of as banks but which nevertheless provide one or more of these broadly defined banking services.

These

institutions

include

finance

companies,

investment

companies, investment banks, insurance companies, pension funds, security brokers and dealers, mortgage companies, and real estate investment trusts. Banking services are extremely important in a free market economy. Banking services serve two primary purposes. First, by supplying customers with the basic mediums-of-exchange (cash, checking accounts, and credit cards), banks play a key role in the way goods and services are purchased. Without these familiar methods of payment, goods could only be exchanged by barter (trading one good for another), which is extremely time-consuming and inefficient. Second, by accepting money deposits from savers and then lending the money to borrowers, banks encourage the flow of money to productive use and investments. This in turn allows the economy to grow. Without this flow, savings would sit idle in someone’s safe or pocket, money would not be available to borrow, people would not be able to purchase cars or houses, and businesses would not be able to build the new factories the economy needs to produce more goods and grow. Enabling the flow of money from savers to

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

investors is called financial intermediation, and it is extremely important to a free market economy. 2.2 Banking Sector in India Banks in India can be categorized into non-scheduled banks and scheduled banks. Scheduled banks constitute of commercial banks and co-operative banks. There are about 67,000 branches of Scheduled banks spread across India. During the first phase of financial reforms, there was a nationalization of 14 major banks in 1969. This crucial step led to a shift from Class banking to Mass banking. Since then the growth of the banking

industry

in

India

has

been

a

continuous

process.

As far as the present scenario is concerned the banking industry is in a transition phase. The Public Sector Banks (PSBs), which are the foundation of the Indian Banking system account for more than 78 per cent of total banking industry assets. Unfortunately they are burdened with excessive Non Performing assets (NPAs), massive manpower and lack

of

modern

technology.

On the other hand the Private Sector Banks in India are witnessing immense progress. They are leaders in Internet banking, mobile banking, phone banking, ATMs. On the other hand the Public Sector Banks are still facing the problem of unhappy employees. There has been a decrease of 20 percent in the employee strength of the private sector in the wake of the Voluntary Retirement Schemes (VRS). As far as foreign banks are concerned

they

are

likely

to

succeed

in

India.

Indusland Bank was the first private bank to be set up in India. IDBI, ING Vyasa Bank, SBI Commercial and International Bank Ltd, Dhanalakshmi Bank Ltd, Karur Vysya Bank Ltd, Bank of Rajasthan Ltd etc are some Private Sector Banks. Banks from the Public Sector include Punjab

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

National bank, Vijaya Bank, UCO Bank, Oriental Bank, Allahabad Bank, Andhra Bank etc. 2.3 Some top foreign banks in India Standard Chartered Bank Citibank American Express Bank ABN-AMRO Bank Deutsche Bank HSBC Bank Abu Dhabi Commercial Bank Ltd Barclays Bank DBS Bank

2.4 Banking as an opportunity Today in this scenario banking sector have wide competition. Private Banks gives more services in comparison the public sector bank. And with the interest income coming under pressure, banks are urgently looking for expanding fee-based income activities. Banks are increasingly getting attracted towards activities such as marketing mutual funds and insurance Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

policies, offering credit cards to suit different categories of customers and services such as wealth management and equity trading.

3. Company Profile 3.1 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. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

The Standard Bank was founded in the Cape Province of South Africa in 1862 by John Paterson. Commenced business in Port Elizabeth, South Africa, in January 1863. The Chartered Bank was founded 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. This friendly merger allowed both banks to capitalise on the expansion of trade caused by the increased movement of goods from Europe to the East and Africa. In 1986 a hostile takeover bid was made for the Group by Lloyds Bank of the United Kingdom. When the bid was defeated, 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. Since the early 90s, 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. We have also focused on consumer, corporate and institutional banking, as well as the provision of treasury services – areas in which the Group has particular strength and expertise. In the new millennium we acquired Grindlays Bank from the ANZ Group and the Chase Consumer Banking operations in Hong Kong in 2000. 3.2 Standard Chartered Bank in India

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Standard Chartered is a London based international bank with significant operations in Asia, Africa, the Middle East and Latin America. 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. Chartered Bank opened its first overseas branch in India, at Kolkata, on 12 April 1858. During that time Kolkata was the most important commercial city and was the hub of jute and indigo trades. With the opening of the Suez Canal in 1869 and the growth of cotton trade, Bombay replaced Kolkata as the main commercial center. Hence Standard Chartered shifted its main operations to Bombay. Today the Bank's branches and sub-branches in India are directed and administered from Bombay with Kolkata remaining an important trading and banking centre. To cater to diverse financial needs, Standard Chartered offers a wide range of state-of-the-art banking products and services through its network of 90 branches in 31 cities across the country.

3.3 Some other fact about SCB •

Over 50 nationalities are represented among our top 500 senior executives.

•

SCB is the only international bank with over 90% profits from Asia, Africa, and the Middle-East. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

SCB is the only international bank with a long unbroken banking history in India and China.

•

SCB is the largest international bank in India in terms of branch network and profits

•

SCB is the only bank in the Falkland Islands.

•

SCB is one of three note issuing banks in Hong Kong.

3.4 Principles and Value •

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 we 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.

3.5 SCB Stand for 3.5.1 Strategic intent •

The world's best international bank

•

Leading the way in Asia, Africa and the Middle East Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

3.5.2 Brand promise •

Leading by Example to be The Right Partner

3.5.3 Values •

Responsive

•

Trustworthy

•

International

•

Creative

•

Courageous

3.5.4 Approach •

Participation Focusing on attractive, growing markets where we can leverage our relationships and expertise

•

Competitive positioning Combining global capability, deep local knowledge and creativity to outperform our competitors

•

Management Discipline Continuously improving the way we work, balancing the pursuit of growth with firm control of costs and risks

3.5.5 Commitment to stakeholders •

Customers Passionate about our customers' success, delighting them with the quality of our service Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Our People Helping our people to grow, enabling individuals to make a difference and teams to win

•

Communities Trusted and caring, dedicated to making a difference

•

Investors A distinctive investment delivering outstanding performance and superior returns.

•

Regulators Exemplary governance and ethics wherever we are.

3.6 Products and Services 3.6.1 Personal Banking:Through our global network of over 1,700 branches and outlets, we offer personal financial solutions to meet the needs of more than 14 million customers across Asia, Africa and the Middle East. •

Personal Banking Plans

•

Accounts

•

Debit Cards

•

Prepaid Cards

•

Credit Cards

•

Loans

•

Investment Services

•

Insurance

•

Online Services

•

Special Offers Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

NRI Accounts

3.6.2 Private Banking:Our Private Bank advisors and investment specialists provide customised solutions to meet the unique needs and aspirations of high net worth clients. 3.6.3 Wholesale Banking:Headquartered in Singapore and London, with on-the-ground expertise that spans our global network, our Wholesale Banking division provides corporate and institutional clients with innovative solutions in trade finance, cash management, securities services, foreign exchange and risk management, capital raising, and corporate finance. 3.6.4 SME Banking:SME Banking division offers a wide range of products and services to help small and medium-sized enterprises manage the demands of a growing business. •

Term Loan

•

Express Trade

•

Trade Services & Working Capital

•

Business Installment Loan

•

International Trade Account

•

Loan/Overdraft Against Property

3.6.5 Islamic Banking:Standard Chartered Saadiq's dedicated Islamic Banking team provides comprehensive international banking services and a wide range of Shariah compliant financial products that are based on Islamic values. 3.6.6 Online Banking:Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Standard Chartered Online is an innovative Online Banking service that you can tailor to suit your precise banking needs. It gives you convenient, round-the-clock

banking

services

ranging

from

day-to-day

account

transfer transactions to real-time valuable financial information. Now you can manage your finances anytime, anywhere. 3.6.7 Mobile Banking:Standard Chartered Bank offer mobile banking to access

your bank

account anytime and from anywhere in the world. Features of mobile banking:•

Balance Information –View balances of your linked savings and current accounts

•

Mini Statement – Get details on the last 3 transactions carried out on your bank account

•

Cheque Book Request – You can now order for a cheque book from your Mobile Phone!

•

Bank Statement Request – Bank Statement requests can be placed through your Mobile phone

3.7 Different Types of Saving Account in Standard Chartered Bank Standard chartered Bank offers basically 6 different type of saving account. According to consumer needs it functioned and very useful. •

aXcess plus account

•

Super value account

•

Parivaar account

•

No frills account

•

aaSaan account

•

2-in-1 account

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Actually my survey has done in Metro city where only 4 types of saving account runs. “No frills” and “aaSaan account” are not for Metro cities.

3. Saving account A savings account typically refers to an account in which one places money to earn a small amount of interest. The savings account funds are usually easily accessible, though some banks do charge for withdrawing money early. In most cases, people can withdraw money from a savings Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

account at any time, at least at any time the bank is open, or one has access to the bank’s ATM. 4.1 Reserve Bank of India Guidelines* •

Photographs of all applicant(s) / Power of Attorney holders

•

PAN / Form No.60/61 (Where PAN is not available) is required to be furnished.

•

Savings Bank A/c can’t be opened for business purposes.

•

SB a/c should be used to route transactions of only non-business / non-commercial nature.

•

If there is no transaction by the account holder in the account continuously

for

24

months,

the

account

automatically

gets

classified as a ‘dormant / inoperative account’ whereupon further debit transactions are not permitted in the ordinary course. •

If the balance in the account becomes zero and remains so continuously for three months or more, the Bank reserves to itself the right to close the account without any obligation to intimate the customer.

•

The bank has the authority to debit the accounts to recover any amount credited erroneously.

4.2 Features of Saving Account •

Interest on the saving account is determined in accordance with directives of the Reserve Bank of India

•

The current interest rate is 3.5%

•

Account can be individually or jointly.

•

Minimum Quarterly balance of a specific amount is to be maintained failing to which a specific fees per quarter has to be paid.

•

Account can be operated at any branch across the country.

•

Enables you to save money Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

24 hour access to your funds via the ATMS

4.3 General requirement to open a saving Account •

Indian Residents

•

NRI’s

•

Clubs, Associations, Trusts and Registered Societies

•

HUF (Hindu Undivided Family)

4. Saving Account in Standard Chartered Bank 5.1 aXcess plus account:-

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

The Standard Chartered aXcess Plus Account comes with a globally valid debit - cum - ATM card which allows customers to aXcess all Standard Chartered Bank ATMs and provides instant cash at all Visa Network ATMs in India and abroad. This account provides unparalleled access to your money through a variety of channels. Highlights:Category Minimum AQB

Regular Rs. 60,000 if balance in linked

Interest Rate Card offered Replacement of Pin Lost card re-issuance

saving a/c is atleast Rs 10,000 3.5% ATM cum Debit Card ATM Cards Rs 50 Rs 100

Some features:•

FREE Unlimited Visa ATM transactions* (Cash withdrawal and balance enquiry)

*

•

FREE Standard Chartered Bank branch access across the county

•

FREE Doorstep Banking

•

FREE Demand Drafts/Pay Orders (drawn at SCB locations)

•

FREE Payable at Par Chequebook

•

International Debit Card

•

Extended Banking Hours

•

Phone banking, Net banking, Multi-city banking, 365 days branches

•

Unique free insurance benefits- lost card, purchase protection.

Available on maintenance of average quarterly balance of Rs 15,000/-

5.2 SuperValue Saving Account:The unique SuperValue savings account from Standard Chartered is proof that the best things in life come free. With an average quarterly balance Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

of just Rs. 50,000, you get a host of services from Standard Chartered absolutely free. Some features:•

Free globally valid Debit-cum-ATM card.

•

Free Access to 6500 ATMs in India.

•

Free Doorstep Banking.

•

Free Payable at Par cheque book/ account statements / DDs

•

Free Bill Pay.

•

Free Inter Bank Funds Transfer.

•

Free Foreign Inward Remittance Certificates.

•

Other benefits of the SuperValue account: o

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

o

Globally valid debit card: Make purchases at over 12 million merchant outlets and withdraw cash at over 810,000 ATMs worldwide using funds from your account

o

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

o

Multicity Banking: Access your account even when you are out of town

o

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

o

Phone banking

o

Internet banking

o

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

5.3 Parivaar Account:This family account allows you to maintain your individual identity while allowing you to tap your family's financial strength. Parivaar is a unique Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Wealth Management Solution from Standard Chartered Bank that offers your family flexibility, convenience and essential tools for

wealth

accumulation and preservation. Some features:•

Your 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.

•

Globally valid ATM-cum-debit card can be used at 3,26,000 merchant outlets in India and 14 million outlets worldwide.

5.4 2-in-1 Account:The 2-in-1 account gives you the facility of linking your fixed deposits with a savings or current account. In case of any shortfall in the savings or current account, funds will be automatically swept in from the linked fixed deposits, thus giving you a combination of both liquidity and higher returns. And that’s not all either. In case you need to withdraw amounts in excess of what is available in your savings or current account, we will break your deposit for the exact amount you require. The rest of the deposit continues earning the original high interest. Some features:•

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 you need it

•

Deposit more money in your account to earn a higher rate of

•

interest by placing subsequent deposits Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

5.5 Service Charges:Parameter/ Saving Account AQB A/c Maintenance Charges

aXcess Plus Rs.10,000

Super Value Rs.50,000

If AQB< 5,000

1,500

1,250

If AQB≥ 5,000 & <7,500

1,250

1,250

If AQB≥ 7,500 & <10,000

750

1,250

If AQB≤ 10,000 & <25,000

1,000

If AQB≥ 25,000 & <50,000

750

2-in-1 Rs.100,000

750

If AQB < 100,000 Account Statements

Free/Quarterly Free/Qua

Free/Qua.

Duplicate Statement Account closure

100/500/-

100/500/-

100/500/-

Issued by customer

300/-

300/-

300/-

Deposited by customer Dormant Account

100/1000/-

Free per 1000/-

annum

annum

Debit card annual fee

200/-

Free

200/-

Debit card replacement fee

200/-

Free

200/-

Gold debit card 1st year fee

799/-

799/-

799/-

Gold debit card annual fee Demand Draft

799/-

799/-

799/-

0.25%

Free

0.25%

0.30%

0.25%

0.30%

(Within 6 months) Cheque Return 100/per

Cards

Drawn

at

own

bank(min.

Free50/- & max. 1,500/-) Drawn at other bank (min. Fee 250/-)

Cancellation 250/Pay order 75/ATM Uses other than SCB First

Branch

transaction

VISA ATMs outside India

free 140/-

250/Free 4 Free

250/75/Free

140/-

140/-

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Replacement of PIN Lost card re-issuance Standing instruction

50/100/-

50/100/-

50/100/-

Setting up charges

100/-

100/-

100/-

Execution fee Banker’s report Signature verification Remittance from abroad

25/50/25/250/-

25/Free Free 250/-

25/50/25/250/-

5. Insurance Life is a roller coaster ride and is full of twists and turns. We cannot take anything for granted in life. Insurance policies are a safeguard against the uncertainties of life. Insurance is system by which the losses suffered by a few are spread over many, exposed to similar risks. Insurance is a protection against financial loss arising on the happening of an unexpected event. Insurance policy

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

helps in not only mitigating risks but also provides a financial cushion against adverse financial burdens suffered. Insurance policies cover the risk of life as well as other assets and valuables such as home, automobiles, jewelry et al. On the basis of the risk they cover, insurance policies can be classified into two categories: 6.1 Life Insurance Policies:Life is very fragile and death is a certainty. We cannot control the uncertainties of life. But, we can cover the risks surrounding us. Life insurance, simply put, is the cover for the risks that we run during our lives. It protects us from the contingencies that could affect us. Life insurance is not for the person who passes away, it for those who survive. It is the responsibility of every bread earner to guard against the events that could affect the family in the unfortunate circumstance of his / her demise. Thus, having a life insurance policy is very vital. Before going for a life insurance policy it is imperative that you know about various types of life insurance policies. Major among them are: •

Endowment Policy

•

Whole Life Policy

•

Term Life Policy

•

Money-back Policy

•

Joint Life Policy

•

Group Insurance Policy

•

Loan Cover Term Assurance Policy

•

Pension Plan or Annuities

•

Unit Linked Insurance Plan

6.2 General Insurance Policies:General Insurance provides much-needed protection against unforeseen events such as accidents, illness, fire, burglary et al. Unlike Life Insurance, General Insurance is not meant to offer returns but is a Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

protection against contingencies. Almost everything that has a financial value in life and has a probability of getting lost, stolen or damaged can be covered through General Insurance policy. Property (both movable and immovable), vehicle, cash, household goods, health, dishonesty and also one's liability towards others can be covered under general insurance policy. Under certain Acts of Parliament, some types of insurance like Motor Insurance and Public Liability Insurance have been made compulsory. Major insurance policies that are covered under General

Insurance

•

Home Insurance

•

Health Insurance

•

Motor Insurance

•

Travel Insurance

are:

6. Unit Linked Insurance Plan Unit linked insurance plan (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). The policy value at any time varies according to the value of the underlying assets at the time. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

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

•

Disability

•

Critical Illness

•

Surgeries

•

Liquidity

•

Tax planning

Features of Unit Linked Insurance Plan:•

Premiums paid can be single, regular or variable. The payment period too can be regular or variable. The risk cover can be increased or decreased.

•

The costs in ULIP are higher because there is a life insurance component in it as well, in addition to the investment component.

•

Investments can be made in gilt funds, balanced funds, money market funds, growth funds or bonds.

•

The policyholder can switch between schemes, for instance, balanced to debt or gilt to equity, etc.

•

As in all insurance policies, the risk charge (mortality rate) varies with age.

•

The maturity benefit is not typically a fixed amount and the maturity period can be advanced or extended.

•

The maturity benefit is the net asset value of the units. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Insurance companies have the discretion to decide on their investment portfolios.

•

They are simple, clear, and easy to understand.

•

Being transparent the policyholder gets the entire episode on the performance of his fund.

•

Provides capital appreciation.

•

Investor gets an option to choose among debt, balanced and equity funds.

•

Lead to an efficient utilization of capital.

•

ULIP products are exempted from tax and they provide life insurance.

ULIP in Standard Chartered Bank Standard Chartered offers a wide range of Life Insurance Products from Bajaj Allianz Life Insurance Company, one of India's leading Insurance companies. 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

7. Bajaj Allianz Life Insurance Co. Ltd. Bajaj Allianz is a joint venture between Allianz AG one of the world's largest insurance companies, and Bajaj Auto, one of the biggest 2 and 3 wheeler manufacturers in the world. Bajaj Allianz is into both life insurance and general insurance. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Allianz Group is one of the world's leading insurers and financial services providers. Founded in 1890 in Berlin, Allianz is now present in over 70 countries with almost 174,000 employees. Bajaj group is the largest manufacturer of two-wheelers and threewheelers

in

India

and

one

of

the

largest

in

the

world.

ULIP – New Unit Gain Bajaj Allianz “New Unit Gain” offers the unique option of combining the protection of life insurance with the attractive prospect of investing in securities. The investor has the freedom to choose the funds he wishes to invest his money in, providing him the opportunity to have a direct stake in the performance of the financial markets. One can also benefit from tax advantages while protecting his loved ones against unfortunate events. Key highlight of Bajaj Allianz New Unit Gain:•

Your investment, apart from normal allocation, receives Loyalty Units equivalent to 51% of First Year’s Annualized Premium over a period of 10 years.

•

Seven investment funds to choose from with unmatched flexibility to manage your investments better.

•

You policy continues to participate in investment performance of the fund(s). Even if you are not able to pay 3 full years premium

•

Maximum flexibility and Option to increase premium

•

Partial

withdrawals

anytime

after

three

years

from

the

commencement of policy provided three full years’ premiums are paid.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Three free switches every year.

•

Option to pay unlimited top up premiums anytime during the tenure of your policy to further enhance your savings.

•

You have three simple terms to choose from – 15, 20 and 25 yrs.

•

A host of optional additional rider benefits to provide you additional protection

•

Guaranteed Life Cover, with a flexibility to choose insurance cover according to your changing needs.

•

Tax Save

•

Partial Withdrawals, Surrender Value, Death Benefit and Maturity Benefit are eligible for tax benefits as per Section 10(10D) of the Income Tax Act.

•

The charges paid for UL Critical Illness and UL Hospital Cash Benefit are eligible for tax benefits as per Section 80(D) of the Income Tax Act.

How does the plan work? Premiums paid by you, net of premium allocation charge, are invested in fund(s) of your choice and units are allocated depending on the unit price of the fund(s). The value of your policy is the total value of units that you hold in the fund(s). The insurance cover charges, policy administration charges and the additional rider benefit charges (if any) are deducted through monthly cancellation of units. Fund Management Charge is priced in the unit value. Important Details of the ‘Bajaj Allianz New UnitGain’ Plan Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Parameter Minimum Age at Entry

Details 0 years, risk commences at age 7.

Maximum Age at Entry

(18 years in case of all Additional Rider Benefits 60 years (50 years in case of all Additional Rider

Minimum Maturity Age Maximum Maturity Age Additional Rider Benefit

Benefits) 18 years 75 years 65 years for all riders except UL WOP

Ceasing Age Minimum Premium

Rs. 10,000 per yearly instalment,

(for Male lives)

Rs. 5,000 per half-yearly instalment, Rs. 1,000 per monthly mode

Minimum Premium

Minimum Top Up Premium is Rs. 5,000 Rs. 7,500 per yearly instalment,

(for Female lives)

Rs. 3,750 per half-yearly instalment, Rs. 750 per monthly mode Minimum Top Up Premium is Rs. 5,000. (Monthly mode for both male and female lives is available

Minimum Sum Assured Maximum Sum Assured

through

ECS

and

Salary

Saving

Scheme only). 0.5 * Policy Term * Annualized Premium Multiplier * Annualized Premium (Multiplier would depend on the age at entry and any riders chosen)

8. Mutual funds Mutual Fund is an instrument of investing money. Nowadays, bank rates have fallen down and are generally below the inflation rate. Therefore, keeping large amounts of money in bank is not a wise option, as in real terms the value of money decreases over a period of time. One of the options is to invest the money in stock market. But a common investor is not informed and competent enough to understand the Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

intricacies of stock market. This is where mutual funds come to the rescue. A mutual fund is a group of investors operating through a fund manager to purchase a diverse portfolio of stocks or bonds. Mutual funds are highly cost efficient and very easy to invest in. By pooling money together in a mutual fund, investors can purchase stocks or bonds with much lower trading costs than if they tried to do it on their own. Also, one doesn't have to figure out which stocks or bonds to buy. But the biggest advantage

of

mutual

funds

is

diversification.

Diversification means spreading out money across many different types of investments. When one investment is down another might be up. Diversification of investment holdings reduces the risk tremendously. The origin of the Indian mutual funds industry dates back to 1963 when the Unit Trust of India (UTI) came into existence at the initiative of the Government of India and the Reserve Bank of India. Since then the mutual funds sector remained the sole fiefdom of UTI till 1987 when a slew of non-UTI, public sector mutual funds were set up by nationalized banks

and

life

insurance

companies.

The year 1993 saw sweeping changes being introduced in the mutual fund industry with private sector fund houses making their debut and the laying down of comprehensive mutual fund regulations. Over the years, the Indian mutual funds industry has witnessed an exponential growth riding piggyback on a booming economy and the arrival of a horde of international fund houses.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

First Phase – 1964-87 Growth of Unit Trust of India Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6, 700 crores of assets under management. Second Phase – 1987-1993 (Entry of Public Sector Funds) 1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. At the end of 1993, the mutual fund industry had assets under management of Rs.47,004 crores. Third Phase – 1993-2003 (Entry of Private Sector Funds) With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector Mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual Fund) Regulations 1996. The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way ahead of other mutual funds. Fourth Phase – since February 2003 In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India with assets under management of Rs.29,835 crores as at the end of January 2003, representing broadly, the assets of US 64 scheme, assured return and certain other schemes. The Specified Undertaking of Unit Trust of India, functioning under an administrator and under the rules framed by Government of India and does not come under the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of assets under management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among different private sector funds, the mutual fund industry has entered its current phase of consolidation and growth. As at the end of September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421 schemes. The graph indicates the growth of assets over the years.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

9.1 Professional Management Mutual Funds employ the services of skilled professionals who have years of experience to back them up. They use intensive research techniques to analyze each investment option for the potential of returns along with their risk levels to come up with the figures for performance that determine the suitability of any potential investment. 9.2 Potential of Returns Returns in the mutual funds are generally better than any other option in any other avenue over a reasonable period of time. People can pick their investment horizon and stay put in the chosen fund for the duration. Equity funds can outperform most other investments over long periods by placing long-term calls on fundamentally good stocks. The debt funds too will outperform other options such as banks. Though they are affected by the interest rate risk in general, the returns generated are more as they pick securities with different duration that have different yields and so are able to increase the overall returns from the portfolio. 9.3 Liquidity

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Fixed deposits with companies or in banks are usually not withdrawn premature because there is a penal clause attached to it. The investors can withdraw or redeem money at the Net Asset Value related prices in the open-end schemes. In closed-end schemes, the units can be transacted at the prevailing market price on a stock exchange. Mutual funds also provide the facility of direct repurchase at NAV related prices. The market prices of these schemes are dependent on the NAVs of funds and may trade at more than NAV (known as Premium) or less than NAV (known as Discount) depending on the expected future trend of NAV, which in turn is linked to general market conditions. Bullish market may result in schemes trading at Premium while in bearish markets the funds usually trade at Discount. This means that the money can be withdrawn anytime, without much reduction in yield. Some mutual funds however, charge exit loads for withdrawal within a specified period. 9.4 Effective Regulation Unlike the company fixed deposits, where there is little control with the investment being considered as unsecured debt from the legal point of view, the Mutual Fund industry is very well regulated. All investments have to be accounted for, decisions judiciously taken. SEBI acts as a true watchdog in this case and can impose penalties on the AMCs at fault. The regulations,

designed

to

protect

the

investors’

interests

are

also

implemented effectively. 9.5 Transparency Being under a regulatory framework, mutual funds have to disclose their holdings, investment pattern and all the information that can be considered as material, before all investors. This means that the investment strategy, outlooks of the market and scheme related details are disclosed with reasonable frequency to ensure that transparency

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

exists in the system. This is unlike any other investment option in India where the investor knows nothing as nothing is disclosed. 9.6 Flexible and Affordable Mutual Funds offer a relatively less expensive way to invest when compared to other avenues such as capital market operations. The fee in terms of brokerages, custodial fees and other management fees are substantially lower than other options and are directly linked to the performance of the scheme. Investment in mutual funds also offers a lot of flexibility with features such as regular investment plans, regular withdrawal plans and dividend reinvestment plans enabling systematic investment or withdrawal of funds. Even the investors, who could otherwise not enter stock markets with low investible funds, can benefit from a portfolio comprising of high-priced stocks because they are purchased from pooled funds. 9.6 Charges The Asset Management Companies (AMCs) managing the Mutual Funds levy a load as a percentage of NAV at the time of entry into the Schemes or at the time of exiting from the Schemes. •

Entry Load - It is the load charged by the fund when an investor invests into the fund. It increases the price of the units to more than the NAV and is expressed as a percentage of NAV.

•

Exit Load - It is the load charged by the fund when an investor redeems the units from the fund. It reduces the price of the units to less than the NAV and is expressed as a percentage of NAV.

•

Cost of Churning/Turnover cost - It refers to the costs associated with the churning (or changes made to the holdings) of the portfolio. Portfolio changes have associated costs of brokerage, custody fees, transaction fees and registration fees, which lower the Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

returns. The quantum depends on the management style of the fund manager. •

Expense

Ratio

-

The

Expenses

of

a

mutual

fund

include

management fees and all the fees associated with the fund's daily operations. Expense Ratio refers to the annual percentage of fund's assets that is paid out in expenses. 9.7 Tax •

Capital Gains Tax- The profit realizations on sale of securities and certain other capital assets (including units of mutual funds) are called capital gains. The gains can be classified into long-term or short-term depending on the period of holding of the asset and are charged to tax at different rates. Gains on mutual fund units held for a period of 12 months or more are long-term gains. These gains are taxable.

•

Dividend

Distribution

Tax

–

The

Mutual

Fund

schemes

distributing dividends on their units to the investors attract a distribution tax as per tax laws. •

Securities Transaction Tax – AMCs managing the portfolio have to pay STT on transaction (buying/selling) of different securities in the stock market. Presently the tax rate is 0.025%.

9.8 Pointers to Mutual Fund Performance Mutual Fund industry today, with about 34 players and more than five hundred schemes, is one of the most preferred investment avenues in India. However, with a plethora of schemes to choose from, the retail investor faces problems in selecting funds. Factors such as investment strategy and management style are qualitative, but the funds record is an important indicator too. Though past performance alone cannot be indicative of future performance, it is the only quantitative way to judge Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

how good a fund is at present. Therefore, there is a need to correctly assess the past performance of different mutual funds. Quite simply then a fund generating more returns than the other is considered better than the other. But this is just half the story. Return alone should not be considered as the basis of measurement of the performance of a mutual fund scheme, it should also include the risk taken by the fund manager because different funds will have different levels of risk attached to them. Risk associated with a fund can be defined as fluctuations in the returns generated by it. The higher the fluctuations in the returns of a fund during a given period, higher will be the risk associated with it. These fluctuations in the returns generated by a fund are resultant of two guiding forces. First, general market fluctuations affecting all the securities present in the market are called market risk or systematic risk and second, fluctuations due to specific securities present in the portfolio of the fund, called unsystematic risk. The Total Risk of a given fund is sum of these two and is measured in terms of standard deviation of returns of the fund. Systematic risk is measured in terms of Beta, which represents fluctuations in the NAV of the fund vis-à-vis market. The more responsive the NAV of a mutual fund is to the changes in the market; higher will be its beta. Beta is calculated by relating the returns on a mutual fund with the returns in the market. While unsystematic risk can be diversified through investments in a number of instruments, systematic risk cannot. By using the risk return relationship, we try to assess the competitive strength of the mutual funds vis-à-vis one another in a better way. It should be appreciated that there is a level of risk that a fund has taken to generate this return. So what is really relevant is not just performance or returns. What matters therefore are Risk Adjusted Returns (RAR).

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

The only caveat whilst using any risk-adjusted performance is the fact that their clairvoyance is decided by the past. Each of these measures uses past performance data and to that extent are not accurate indicators of the future. 9.9 Benefits of Mutual Funds Investor is benefited by investing in Mutual Funds because •

Diversification: - Diversified portfolio is balanced in varying economic conditions. When there is rise in interest rate, some securities decrease and some increase in value. Gradually the value of overall portfolio increases over time even if some securities lose value

•

Professional Management - Top managers are paid by Mutual funds to manage their investments. They decide what securities the fund will buy and sell

•

Liquidity - Money can be taken out of mutual fund anytime easily

•

Convenient - Mutual fund shares can be bought by email, phone or over internet.

•

Regulatory Oversight - Investors are protected from fraud as mutual funds are subject to government regulations

•

Low Cost - Expenses of Mutual Fund is 1.5% of the investment.

•

Tax Benefits - Investors gets tax benefits over the money invested in Mutual Fund

•

Transparent and Flexible

•

Choice of Schemes - Investor can choose between many schemes

•

Well regulated

9.10 Disadvantages of Mutual Funds •

No Guarantee - When the entire stock market goes down, the Mutual Fund shares will also go down even if the portfolio is balanced though the risk is low Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Administrative fees or sales commissions is charged by all the funds to compensate brokers and financial planners

•

Taxes have to be paid on the income the investors make even if you reinvest the profit

•

Management Risk is always there as the funds manager takes the decision for you regarding funds portfolio

9.11 Types of Mutual Funds •

Open-end fund

•

Exchange-traded funds

•

Equity funds o

Capitalization

o

Growth vs. value

o

Index funds versus active management

•

Bond funds

•

Money market funds

•

Funds of funds

•

Hedge funds

9.12 Performance Comparison of Mutual Funds •

Equity Linked Savings Scheme - A special product offered by mutual funds. These schemes invest in equity i.e shares and generally have a lock-in period of three years.

•

Balanced Funds – These funds invest part of their corpus into Debt Instruments which give a fixed rate of return and the remaining part of the corpus into Equity giving a high rate of return. Thus, overall the balanced funds give a moderate rate of return with lower risk as compared to the pure equity funds.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

9.13 Criticism of managed mutual funds:•

Historically, only a small percentage of actively managed mutual funds, over long periods of time, have returned as much, or more than comparable index mutual funds.

•

Critics point out that high sales commission can sometimes represent a conflict of interest, as high commissions benefit the sales people but hurt the investors. Although in reality, "A shares", which appear to have the highest up front load, (around 5%) are the "cheapest" for the investor, if the investor is planning on 1) keeping the fund for more than 5 years, 2) investing more than 100,000 in one fund family, which likely will qualify them for "breakpoints", which is a form of discount, or 3) staying with that "fund family" for more than 5 years, but switching "funds" within the same fund company

•

Mutual fund managers and companies need to disclose by law, if they have a conflict of interest due to the way they are paid. In particular fund managers may be encouraged to take more risks with investors’ money than they ought to: Fund flows (and therefore compensation) towards successful, market beating funds are much larger than outflows from funds that lose to the market. Fund managers may therefore have an incentive to purchase high risk investments in the hopes of increasing their odds of beating the market and receiving the high inflows, with relatively less fear of the consequences of losing to the market.

•

Difficulty to effectively manage large pool of money

•

some funds illegally are gulity of market timing and that some fund managers, also illegal, accept extravagant gifts in exchange for trading stocks through certain investment banks, which presumably charge the fund more for transactions than would non-gifting investment bank. This practice, although done, is completely illegal.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

9. ULIP Vs. Mutual Funds •

Unit Linked Insurance Policies (ULIPs) as an investment avenue are closest to mutual funds in terms of their structure and functioning. As is the case with mutual funds, investors in ULIPs are allotted units by the insurance company and a net asset value (NAV) is declared for the same on a daily basis.

•

Similarly ULIP investors have the option of investing across various schemes similar to the ones found in the mutual funds domain, i.e. diversified equity funds, balanced funds and debt funds to name a few. Generally speaking, ULIPs can be termed as mutual fund schemes with an insurance component.

•

However it should not be construed that barring the insurance element there is nothing differentiating mutual funds from ULIPs.

The various factors where the ULIPs and Mutual Funds differ are as follows: ULIPs Determined by the investor and can be modified as well

Mutual Funds Minimum investment amounts are determined by the fund house

Expenses

No upper limits, expenses determined by the insurance company

Upper limits for expenses chargeable to investors have been set by the regulator

Portfolio disclosure

Not mandatory

Quarterly disclosures are mandatory

Investment amounts

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Modifying asset allocation

Generally permitted for free or at a nominal cost

Entry/exit loads have to be borne by the investor

Tax benefits

Section 80C benefits are available on all ULIP investments

Section 80C benefits are available only on investments in tax-saving funds

With these comparable there are certain factors where in these two differ. Mutual funds are essentially short to medium term products. The liquidity that these products offer is valuable for investors. ULIPs, in contrast, are positioned as long-term products and going ahead, there will be separate playing fields for ULIPS and MFs, with the product differentiation between them becoming more pronounced. ULIPs do not seek to replace mutual funds, they offer protection against the risk of dying too early, and also help people save for retirement. Insurance has to be an integral part of one's wealth management portfolio. Further, exposure of Indian households to capital markets is limited.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

10.Taxation India has a well developed tax structure with a three-tier federal structure, comprising the Union Government, the State Governments and the Urban/Rural Local Bodies. The power to levy taxes and duties is distributed among the three tiers of Governments, in accordance with the provisions of the Indian Constitution. The main taxes/duties that the Union Government is empowered to levy are Income Tax (except tax on agricultural income, which the State Governments can levy), Customs duties, Central Excise and Sales Tax and Service Tax. The principal taxes levied by the State Governments are Sales Tax (tax on intra-State sale of goods), Stamp Duty (duty on transfer of property), State Excise (duty on manufacture

of

alcohol),

Land

Revenue

(levy

on

land

used

for

agricultural/non-agricultural purposes), Duty on Entertainment and Tax on Professions & Callings. The Local Bodies are empowered to levy tax on properties

(buildings,

etc.),

Octroi

(tax

on

entry

of

goods

for

use/consumption within areas of the Local Bodies), Tax on Markets and Tax/User Charges for utilities like water supply, drainage, etc. Since 1991 tax system in India has under gone a radical change, in line with liberal economic policy and WTO commitments of the country. Some of the changes are: •

Reduction in customs and excise duties

•

Lowering corporate Tax

•

Widening of the tax base and toning up the tax administration

The fifth consecutive budget presented by the FM, Mr. P. Chidambaram ,was also a dream one for the

salaried class……..With the higher tax

limits on the income tax slabs ,the increased basic exemption limit for Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

senior citizens ,women and individuals in general, etc. the budget gives much relief to the middle class as it aims at reducing their overall tax liability by a good measure. Here we can take a look at the direct tax proposals and the impact they will have on our finances. Income tax slabs The exemption limit for personal income tax has been enhanced to Rs. 1.80 lakh from the present Rs. 1.45 lakh for women (below the age of 65 years),Rs. 2.25 lakh from the present Rs.1.95 lakh for senior citizens and Rs.1.5 lakh from the present Rs.1.1 lakh for others. The revised tax slabs are as tabulated on the next page.

Proposed tax slab for FY 2008-09(Assessment Year 2009-10) For Men below 65 years of age

For Women below 65 Years of age

For Senior Citizens

Income level

Tax rate

Income level

Tax rate

Income level

Tax rate

Up to Rs.1,50,000

Nil

Up to Rs.1,80,000

Nil

Up to Rs.2,25,000

Nil

Rs. 1,50,001Rs. 3,00,000 Rs. 3,00,001Rs. 5,00,000 Above Rs.5,00,000

10%

Rs.1,80,001Rs.3,00,000

10%

Rs.2,25,001Rs.3,00,000

10%

20%

Rs.3,00,001Rs.5,00,000

20%

Rs.3,00,001Rs.5,00,000

20%

30%

Above Rs.5,00,000

30%

Above Rs.5,00,000

30%

The revision of the income slabs and the applicable rates of tax will result in substantial savings for individuals across all income ranges. The

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

following table gives a comparative analysis of the post budget savings that will accrue: Comparative analysis of post-budget Tax Savings Male Tax payers (below the age of 65 years) Income (Rs.)

Existing tax liability (Rs.)

1 lakh

Nil

Tax Savings liability as (Rs.) per Budget 2008(Rs.) Nil Nil

2 lakh

14,420

5,150

3 lakh

40,170

4 lakh

Female Tax payers (below the age of 65 years) Existing tax liability (Rs.)

Savin gs (Rs.)

Nil

Tax liability as per Budget 2008(Rs.) Nil

9,270

10,815

2,060

8,755

15,450

24,720

36,565

12,360

71,070

36,050

35,020

67,465

32,960

5 lakh

1,01,970

56,650

45,320

98,365

53,560

7 lakh

1,63,770

1,18,450

45,320

1,60,165

1,05,060

10 lakh

2,56,470

2,11,150

45,320

2,52,865

1,97,760

15 lakh

4,52,067

4,02,215

49,852

4,48,102

3,87,486

20 lakh

6,22,017

5,72,165

49,852

6,18,052

5,57,436

24,20 5 34,50 5 44,80 5 55,10 5 55,10 5 60,61 6 60,61 6

Nil

Senior Citizens(65 Years & above) Income (Rs.) 1 lakh

Existing tax Tax liability as Savings (Rs.) liability (Rs.) per budget 2008 (Rs.) Nil Nil Nil

2 lakh

1,030

Nil

Nil

3 lakh

26,780

7,725

19,055

4 lakh

57,680

28,325

29,355

5 lakh

88,580

48,925

39,655

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

7 lakh

1,50,380

1,10,725

39,655

10 lakh

2,43,080

2,03,425

39,655

15 lakh

4,37,338

3,93,718

43,620

20 lakh

6,07,288

5,63,668

43,620

After a glimpse at the above tables we can conclude immense saving potential for individual tax payers across The reduction in tax liabilities aims at making lives easier class. It also tries to enhance their purchasing power and, gives impetus to demand and growth of the industry

Skyline Business School, Gurgaon

that there is all categories. for the middle in the process

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

11.ABN-AMRO Bank

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

12.1 History The origin of ABN AMRO Bank can be traced to 1824 King Willem-I issued a royal decree creating the Nederlandsche Handel-Maatschappij (NHM) with the aim of reviving trade between the Netherlands and the Dutch East Indies. In 1964, NHM merged with De Twentsche Bank to form Algemene Bank Nederland (ABN), while Amsterdamsche Bank and Rotterdamsche Bank joined to become Amsterdam-Rotterdam (Amro) Bank. In 1991, these two banks merged to form ABN AMRO Bank. Today, ABN AMRO's international network comprises 3,568 branches and offices in over 320 cities and 76 countries and territories, with over 100,000

highly

qualified

staff.

In India, ABN AMRO Bank has launched its Private Banking Services, offering a comprehensive range of high quality Portfolio Advisory Services along with a comprehensive transaction execution platform. ABN AMRO (India) has branches in Bangalore, Baroda, Chennai, Delhi, Gurgaon, Hyderabad, Kolkata, Lucknow, Mangalore, Moradabad, Mumbai, Noida, Panipat, Pune, Surat and Tirupur. 12.2 Consumer base banking products 

Deposits - Savings, Current and Easy Draw Fixed Deposit Accounts



Loans - Home, Personal, Car Loans and Business loans



Credit Cards - accepted globally, credit card payments made easier through Drop Box (1700 across the city) system for cheque payments.



Debit Cards - Accepted at over 200,000 merchant locations for direct payments In India and ATM Withdrawal from around 12,000 ATM's Under ABN AMRO and Associates.



NRI Services



Investment Services - Mutual Funds and Bonds Skyline Business School, Gurgaon

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12.3 Saving Account in ABN-AMRO Bank •

Flex Plus

•

Flex Advantage

•

Flex Privilege

•

Incentive

12.4 Features for all (Except Incentive Saving a/c) ABN-AMRO Saving Account (In General):•

Experience the freedom of accessing your account from anywhere, anytime.

•

International Debit Card.

•

365 Days Banking & 24-Hour Bank by Phone.

•

Bancafé: Enjoy a cup of fresh coffee while banking between 7.30 pm and 11 pm at our Bancafé.

•

Mobile/SMS Banking - Mpower

•

Utility Payments.

•

Online Railway Reservations.

•

E- Statements

•

Customised Alerts

12.5 Flex Plus The Flex Plus Savings Account provides a gamut of enhanced services, while

letting

you

enjoy

unique

benefits.

With

extra

access

and

convenience of banking, the Flex Plus Savings Account actually rewards you for using it, thereby, giving more value for your money and time. Some Features of Flex Plus Some Additional Features:•

Free Payable At Par Cheque Books. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Royalties: When you open an ABN AMRO Flex Plus Savings Account, you automatically become a member of India’s first Banking Rewards Program.

•

Co-branded Indian Airlines Debit Card: Free membership to IA Flying Returns Program, Free upgrade to business class, 10% discount on regular fares, 5% discount on APEX fares and bonus royalties on tickets, and much more. These power packed features are available at a registration fee of Rs.399 and renewal charges of Rs.250 p.a. (service tax extra).

Details of Flex Plus Saving Account:Savings Account Plan Monthly Balance Requirement Add-on Account

Flex Plus Rs. 10,000 pm 1 Savings Account at aggregate balance

Debit Card Indian Airlines Card (optional) Gold Debit Card (optional) UTI and MasterCard ATMs POS/ATM Daily limit At Par Cheque Books Cash Delivery (Rs.1,000

requirement

of

Rs.15,000 pm Rs.180 pa Rs.399 registration fee + Rs.250 pa Rs.400 pa Free Domestic cash withdrawal* Rs.50,000 Free to 1 Free per day

Rs.100,000) Account Statement Railway Ticket Booking Service Bill Payments Online Banking *Subject to maintenance of average

Monthly on e-mail Free Free Free balance requirement.

12.6 Flex Advantage:The Flex Advantage Savings Account is more than just your ordinary savings account - it's your window to endless financial opportunities. You get expert assistance by Personal Bankers who help you make choices, Skyline Business School, Gurgaon

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suiting your financial needs and risk profile. The account offers you transactional ease and takes banking to a new level with its host of powerful features. Some Additional Features:•

No Minimum Balance: The Flex Advantage Savings Account comes with a unique feature. It lets you operate your account without maintaining a minimum balance. Fulfill a simple criteria and avail of this benefit.

•

Personalised Payable at Par Cheque Books.

•

royalties on tickets and much more. These amazing benefits are available at a registration fee of Rs. 399 and renewal charges of Rs. 250 p.a.

•

Purchase on debit card (ATM daily limit) Rs 50,000

Details of Flex Advantage Saving Account:Monthly Balance Requirement Debit Card Gold Debit Card (optional) Indian Airlines Card (optional)

No minimum balance** Rs.180 p.a. Rs.400 p.a. Rs.399 registration fee + Rs.250

p.a. UTI Bank/MasterCard ATMs Free Domestic Withdrawals** Purchase on Debit Card/ATM Rs.50,000 Dailylimit At par Cheque Books Cash Delivery (Rs.1,000

Free to 1 Free per day

Rs.100,000) Account Statement Monthly on e-mail Railway Ticket Booking Service Free Bill Payments Free Online Banking Free • **Subject to minimum transaction fulfillment. 12.7 Flex Privilege:Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Flex Privilege Savings Account is a truly unique savings account. With a host of value added features and personalised services, it is designed to cater to successful individuals like you, who expect nothing but the best. Extend the privileges on this exclusive account to your family with two complimentary savings accounts. Some Additional Features:•

Free Demand Drafts

•

Personalised Payable At Par Cheque Books

•

Drop-Box Service

•

Portfolio Statements

Details of Flex Privilege Saving Account:Savings Account Plan Monthly balance requirement Add-on account

Flex Privilege Rs.50,000 pm 2 savings account within above balance

requirement Welcome Reward Points 500 points on account activation Debit Card Lifetime free Indian Airlines Card (optional) Rs.399 registration fee + Rs.250 pa Gold Debit Card (optional) Rs.400 pa UTI and MasterCard ATMs Free cash withdrawal* POS/ATM daily limit Rs.1 lac Drafts All free (conditions apply) Cash Delivery (Rs. 1,000 to Rs. Unlimited 100,000) At par cheque books Free Account statement Monthly Railway ticket booking service Free Bill payments Free Online banking Free *Subject to maintenance of average balance requirement. 12.8 Flex Incentive:-

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All company needs to do is open your incentive account today for your monthly salary and you experience the personalised service that makes ABN AMRO the better alternative in banking. Because your work pressures shouldn't be compounded by a bank that doesn't respond to your crunching schedules. Features:•

Zero Balance Account: You do not have to maintain a minimum balance in your Savings Account.

•

International Debit Card

•

Safety Shield - a temporary overdraft facility

•

365 Days Banking-up to 7 pm.

•

Personal and Car Loans

•

Insurance Products

•

National Access: Open an account in any branch and access it from any other branch in India.

•

Portfolio Statements

•

Combined Interest Certificates.

•

Free Credit Card: The Freedom Credit Card can be yours FREE for the first year with an Add-on card, also free for the first year. You can also apply for India's first chip-enabled Credit Card - the Smart Gold Card - and get one Add-on card free for life!

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

12.Housing Development Finance Corporation Limited (HDFC)Bank

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

13.1 History HDFC Bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. The Bank commenced operations as a Scheduled Commercial Bank in January 1995. The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. Headquartered in Mumbai, HDFC Bank, has a network of over 531 branches spread over 228 cities across India. All branches are linked on an online real-time basis. Customers in over 120 locations are serviced through Telephone Banking. The Bank also has a network of about over 1054 networked ATMs across these cities. HDFC Bank's ATM network can be accessed by all domestic and international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus and American Express Credit / Charge cardholders. HDFC Bank has won many awards for its excellent service. Major among them are "Best Bank in India" by Hong Kong-based Finance Asia magazine in 2005 and "Company of the Year" Award for Corporate Excellence 2004-05. 13.2 The Personal Banking Services include: •

Accounts and Deposits

•

Loans

•

Credit, Debit and Demat Cards

•

Investments and Insurance

•

Forex and Trade Services

•

Private Banking

13.3 Saving Accounts in HDFC Bank:In HDFC Bank total 17 different types of account have. But mainly 4 types of saving account we will discuss here. Because other are salary a/c, kids a/c etc.

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•

Regular Saving Account

•

Saving Plus Account

•

Saving Max Account

•

No frills Account

13.3.1 Regular Saving Account Features:•

Wide network of branches and over thousand ATMs to meet all your banking needs no matter where you are located.

•

Bank conveniently with facilities like NetBanking and MobileBankingcheck your account balance, pay utility bills or stop cheque payment, through SMS.

•

Never overspend- Shop using your International Debit Card that reflects the actual balance in your savings account.

•

Personalised cheques with your name printed on each cheque leaf for enhanced security.

•

Take advantage of BillPay, an instant solution to all your frequent utility bill payments. Instruct for payment over the phone or through the Internet.

•

Avail of facilities like Safe Deposit Locker, Sweep-In and Super Saver facility on your account.

•

3 Free transactions on SBI/Andhra Bank ATMs per month.

•

Free Payable-at-Par chequebook, without any usage charges upto a limit of Rs.50,000/- per month.

•

Free InstaAlerts for all account holders for lifetime of the account.

•

Free Passbook facility available at home branch for account holders (individuals).

•

Free Email Statement facility.

13.3.2 Saving Plus Account:Features:Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Minimum Balance required 5,000

•

Wide network of branches and over thousand ATMs to meet all your banking needs no matter where you are located.

•

2 Free transactions on SBI/Andhra Bank ATMs per month.

•

3 Free transactions on any other Bank's ATM per month.

•

Free International Debit Card for all account holders for life time of the account.

•

Free Payable at Par (PAP) chequebook without any usage charges upto a limit of 50,000 per month.

•

Free Demand Drafts on HDFC Bank locations, upto a limit of 25,000/- per day.

•

Free BillPay & InstaAlerts for all account holders for lifetime of the account.

•

Free Electronic Funds Transfer facility, NetBanking, PhoneBanking & MobileBanking.

•

Special relationship discount on purchase of Gold Bars.

•

25%-off on the Locker rental for the 1st year (only).

•

Intercity Banking / Multi-city Banking.

•

Free Passbook facility available at home branch for account holders (individuals).

•

Free Email Statement facility.

13.3.3 Saving Max Account:Features:-

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•

Free unlimited transactions: Cash withdrawal and balance enquiry, at all HDFC Bank ATMs & on any other Bank's ATM using your HDFC Bank Debit Card.

•

Free Gold Debit Card for primary account holder for lifetime of the account. Gold Debit Card for other account holders at Rs 250/- p.a.

•

Free Woman's Advantage/International Debit Card for all account holders for lifetime of the account.

•

Free Payable-at-Par (PAP) chequebook, without any usage charges upto a limit of 1 lac per month.

•

Free Demand Drafts on HDFC Bank locations, upto a limit of 50,000/- per day at home branch.

•

Self/Third Party Cash Deposit/Withdrawal at non-home branches, upto Rs 50,000/- per day free. Above Rs 50,000 a charge of Rs 2.90 per thousand on the full amount would be applicable.

•

Optional sweep out facility to transfer extra savings to a Fixed Deposit, at the threshold of Rs.50,000/-. In the event of the balance in SavingsMax account exceeding Rs 50,000/-, the amount in excess of Rs 50,000/- will be swept out in to a Fixed Deposit with a minimum value of Rs 25000/- for a 1year 1day period.

•

Free BillPay & InstaAlerts for all account holders for lifetime of the account.

•

Free Monthly Statement of Account.

•

50% off on the Locker rental for the 1st year only.

•

Folio maintenance charges on Demat account free for first year.

•

Free

National

Electronic

Funds

Transfer

facility,

NetBanking,

PhoneBanking & MobileBanking. •

Free Passbook facility available at home branch for account holders.

•

Free Email Statement facility.

13.3.4 No frill Account:Features:Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Access a wide network of branches and over a thousand ATMs across the country to meet all your banking needs.

•

Bank

conveniently

with

facilities

like

Free

NetBanking

and

MobileBanking. •

Use the Free Electronic Funds Transfer (EFT) facility to transfer funds from your HDFC Bank account to an account in another Bank at the locations as specified by RBI.

•

Enjoy Free IVR based PhoneBanking. (Agent assisted calls will be charged)

•

Get Free Quarterly Account Statements.

•

Access your account through a Free ATM Card.

•

Enjoy free Cash Deposits at Branch/ATM.

•

9 Free Cash withdrawals per Quarter at Branch and HDFC Bank ATMs.

•

International Debit Card available only on request at the branch @ Rs. 100/- p.a. for each applicant.

•

First Chequebook consisting of 25 leaves free and subsequent cheque books to be charged at the rate of Rs 5/- per cheque leaf.

•

Take advantage of BillPay, an instant solution to all your frequent utility bill payments. Instruct for payment over the phone or through the Internet.

•

Enjoy InstaAlerts via e-mails or SMS at nominal charges.

•

Avail facilities like Safe Deposit Locker, Sweep-In and Super Saver on your account.

•

Free Email Statement facilit

13.The Industrial Credit and Investment Corporation of India Limited (ICICI) Bank

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

14.1 History ICICI Bank is India's second-largest bank. The Bank has a network of about 573 branches and extension counters and over 2,000 ATMs. ICICI

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution, and was its wholly-owned subsidiary. ICICI was formed in 1955 at the initiative of the World Bank, the Government of India and representatives of Indian industry. The objective was to create a development financial institution for providing mediumterm

and

long-term

project

financing

to

Indian

businesses.

n the 1990s, ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services, both directly and through

a

number

of

subsidiaries

and affiliates like ICICI Bank.

In 1999, ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE. In 2001,

ICICI

bank

acquired

Bank

of

Madura

Limited.

ICICI Bank set up its international banking group in fiscal 2002 to cater to the cross border needs of clients and leverage on its domestic banking strengths to offer products internationally. ICICI Bank currently has subsidiaries in the United Kingdom, Canada and Russia, branches in Singapore and Bahrain and representative offices in the United States, China,

United

Arab

Emirates,

Bangladesh

and

South

Africa.

Today, ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialised subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management.

14.2 The Personal Banking Services include: 

Deposits: deposits into savings account, fixed deposits, security deposits and recurring deposits. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks



Loans: home loans, car loans, personal loans, loans against property, gold and securities besides much other special financial assistance for rural and industrial use.



Investments: bonds, mutual funds, Senior citizens savings and Pure Gold.



Insurance: home, vehicle and health insurance.



Foreign Exchange Services



Demat And Credit Services



Wealth Management



Private Baking



Online Banking Services

14.3 Saving Account in ICICI Bank:ICICI bank offers 9 different types of Saving Account. We discuss here main 4 types of saving accounts. •

Saving account

•

Special Saving Account

•

People’s Saving Account

•

No Frill Account

14.3.1 Saving Account:Features •

The ICICI Bank International debit card is a debit-cum-ATM card providing you with the convenience of acceptance at merchant establishments and cash withdrawals at ATMs.

•

The next time you want to withdraw cash from your ICICI Bank Savings account, just walk into any bank's ATM and use your ICICI Bank ATM-cum-Debit card for free. The above benefit is available to individual domestic Savings Account holders on maintenance of a quarterly average balance of more than Rs.10, 000 in the savings Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

account in a quarter. The above benefit can be availed in the same quarter. •

Money Multiplier Facility

•

Internet Banking is offered free of cost.

•

Anywhere Banking - This facility entitles the account holder to withdraw or deposit cash upto a limit of Rs.50,000 across all ICICI Bank branches.

•

You can give us various types of standing instructions like transferring to fixed deposit accounts at regular intervals.

•

An average quarterly balance of Rs.10,000 only in metro and urban locations and Rs.5,000 only in semi-urban and rural locations.

•

Nomination facility is available.

•

Interest is payable half-yearly.

Minimum Balance* Type of Account

Balance Rs 10,000 in metro and urban

Savings Account

locations Rs.5,000 in Semi urban areas

Non-maintenance

of

the minimum

average quarterly balance

attracts a fee of Rs 750 per quarter.

14.3.2 People’s Saving Account:-

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Features •

A savings account from ICICI Bank available only through our Rural branches.

•

Minimum balance of Rs.500/-.

•

No annual fees.

•

Unlimited transactions at the base branch where you have opened your account.

•

Internet, Phone and Mobile banking free of cost.

14.3.3 Super Saving Account:-

Features •

Operating account with free multi city chequebook facility.

•

Money Multiplier Facility

•

We trust relationship

totally and

your commitment do

not

to

prescribe

the any

account minimum

and

the

balance

requirement. In other words, there is no penalty for nonmaintenance of minimum balances in the accounts. •

Internet Banking

•

Phone Banking

•

Free Anywhere banking

•

Free collection of outstation cheques

•

Free monthly account statements

•

Inward remittance through Money2India for FCRA approved trusts

14.3.4 No Frill Account:•

The quarterly average balance requirement for this account is nil

•

Free ICICI Bank VISA debit card

•

One chequebook of 25 leaves per annum free.

•

Internet Banking is not available. Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

•

Mobile Banking is not available.

•

Access to all ICICI Bank ATMs free

•

All anywhere banking transaction chargeable at normal charges as published from time to time

•

Interest payable half yearly.

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14.Comparison of various bank’s Service and Charges with Standard Chartered Bank.

Standard Chartere d ICICI

S .no Features 1 2

Avg.Quaterly Bal. Rate of Interest

10,000 3.50%

10000 3.50%

3 4 5

Internet Banking Doorstep Banking Phone Banking Standing Instructions DDs n payorders Acc. Maintainace charges (a) AQB<5000 (b)AQB>or=5,000& <7000 (c)AQB>or=7,500& <10000 (d)AQB>or=10,000 Quarterly Statement Monthly Statement Duplicate Statement Pass Book Duplicate Pass book Cheque book ATM card ATM card usage outside India Debit card(Per year) Gold Debit card(Per year) Lost Card re-issue (a) ATM Card (b) Debit card (c) Gold Debit card Manual cash

Free Free Free

Free

Free Free Free 125+25per tr. 2/- per 1000

1,500

6 7 8

9 10 11 12 13 14 15 16 17 18 19

20

ABN AMRO

HDFC

(ADB)10000 3.50% 25(Per month) Free 100

5000 3.50%

50 50

150+25 Free

750

500

750

1,250

750

500

750

750 0

750 0

500 0

750 0

Free Free

Free Free

Free Free

free free

100/150 Free

100 Free

100

100 Free

Free Free

100 Free Free

50 Free

Free Free

140 200

100 99

799 100 200 799

Free free 50

200 200

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180

110

400

500 100 100 500 70

Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

21 22 23

24

withdrawal (a) within India (b) outside India Replacement of Pin Account closure Stop Payment (a) Single cheque (b) range of cheques Cheque return (a)issued by customer (b)deposited by customer

100 150 Free 500

25 50

500

25 100

100

100

100

50

200

100

100

100

300

350

350

350

100

100

100

125+ charges

200

100 150+other (c ) Foreign banks currency cheques charges

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15.Saving Account Potential Survey A survey was being conducted as a part of project in Delhi NCR region to analyse the market potential of saving account specially SBC’s saving account in comparison to other banks. The total sample size of the survey is 60. 16.1 Objective:•

To know the customers interests in saving account

•

To know the present scenario of saving account

•

To know what’s the service facility customer want.

•

To know the how much customers want to more facilities in using bank account

•

To understand, are they wanted to open a saving account in another bank, if yes then what is the reason behind it.

16.2 Research Methodology The research methodology consisted of two phases. Phase one consisted of data collection. It included primary data collection as well as secondary data collection. Primary data collection consisted of the survey process. People of different age group as well as income category were asked to fill a common questionnaire. Secondary data collection consisted of data collection from internet and books. The second phase consisted of analyzing the primary data. The analysis consisted of graphs and inferring results or trends from those graphs. Some general conclusions could be drawn from the primary data. Skyline Business School, Gurgaon

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16.3 Survey Analysis 1. Male Vs Female

2. No. of people participated in survey on the basis of different age group.

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In this survey total 60 persons participated. Out of 60, 54 are male and 6 are female. If we take the people age group wise then 20-30(44%), 3040(28%),

40-50(23%)

and

50-60(5%).

This

shows

that

younger

generation more attract towards privatisation means private sector. 3. No. of people participated in survey from different

occupation.

4. No. of people from different income group.

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Here we easily see that the 55% people are businessman and 40% are from private jobs. And in income group 37% people are from income group 4.5 -5.5 lakh and the 30% are 3.5-4.5 lakh. So conclusion that here the majority of businessman and private job person are interested in saving account. 5. Age Group Vs Using Bank

6. Income Vs Using Bank

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Here the market potential of private sector banks ICICI leading in Saving Account. The age group 20-30 & 30-40years is the choice of ICICI Bank. If we take Income group wise, in this ICICI also leading, second place occupied by HDFC.

7. Types of Saving account people have

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

8. Bank which people have saving account

Here we find that the market potential of ICICI Bank is high because out of 60 people 31(51%) peoples have ICICI Saving Account. HDFC & Other are equivalent. Where Standard chartered Bank has only 2% people.

9. Age Group Vs Features

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

As far as the using features are concerned the people are more aggressive towards the ATM Network then after they said about the Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Service and after the service they looking for other. Other included new era service like Doorstep Banking, Mobile Banking, and Online Banking. In survey I found that a person usage ATM thrice and more times in a week. Its shows that how people devoted about ATM Network and also for other Services like Mobile banking, Doorstep Banking, Online Banking and etc.

10.Features which people like in using bank

The overall analysis said that feature which people like in using bank is ATM Network and after that other services like Door Banking, Internet Banking, Online Banking, Mobile Banking and etc. Every person wants to each thing at his Door because nobody wants to expense time.

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11.People preferred bank (If switches)

Here overall percentage of preferring bank (if people want to open a new saving account) is ICICI, 39% and Standard Chartered is 25%. It show the how people go for using new feature and better Service. In this also people want to go for a brand name which Standard chartered bank has. 12.Age Group Vs Preferred Bank (If Switches)

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Here I find that the age group of 20-30 preferred Brand Name like Standard Chartered Bank which is 39%. Except the age group 40-50 all are prefer SCB. The Second position occupied by ICICI Bank. The reason of why people prefer Standard Chartered Bank and ICICI bank more. I am discussing in next chart.

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13. Banks Vs Reason for Preferring

In this competitive world people do not want waste his time. So he/she is more conscious about time and money saving. I found that in the above chart people pay more attention on banking core services in the other hand they also want everything at his/her home. They also want to utilise

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new banking services like mobile alert, fund transfer through mobile, online banking, and doorstep banking etc.

16.Conclusion We all are well know that how much time is precious for everyone. Everyone do not want waste his/her time single minute. In this competitive era world are globalised. Due to globalisation every person want to be fastest. Standard Chartered Bank also want to be no. 1 through the offer more and more services. I found that the potential of saving account is more than current account. As we know that a saving account can be sole name or joint name. So, most probably people have a saving account. People like saving account because its service are beneficiary and due to competition more services offered by the banks. I found that in my survey people more eager about banking service whatever bank charges for services. As i already said that people have not much time. Show they utilise latest service which provided by the banks. In mean while people also go for the brand name because thay want to show their standard. Skyline Business School, Gurgaon

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Last but not least I found that age group 20-30 & 30-40years people more conscious about ATM Network, Banking Services and Brand name.

17.Limitation of project

•

The Sample size is 60 which is very small

•

The survey done in the Delhi NCR region

•

The time period of data collection is very small

•

Behaviour of respondent

•

All data collected in July 2008, when sensex was at 12,500 points. So the condition of market was not good.

•

Due to this reason no one want to talk about investment or other banking product.

•

There is no sample from rural areas.

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

18.Bibliography www.standardchartered.co.in www.icicibank.com www.hdfcbank.com www.abnamro.co.in www.business.mapsofindia.com www.rediff.com/money www.finance.indiamart.com www.rupeetimes.com www.tmb.in/doc/sb_rules.pdf www.traderji.com http://www.iloveindia.com/finance/insurance/life-insurance/unit-linkedinsurance-plans.html http://www.altiusdirectory.com/Finance/investments-mutual-funds.html http://www.rupeetimes.com/compare/savings_accounts/icici_bank.html http://www.indiahousing.com/banks-in-india/icici-bank.html Mutual Fund Book –HSBC Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

100 hour Insurance training – IRDA

19.

Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Annexure - 1

QUESTIONNAIRE:Name:-

Sex:- M / F

Mobile:1. Age:1. 20-30 Yrs

2. 30-40 Yrs

3.

40-50 Yrs

5.

Above 60 Yrs

4. 50-60 Yrs

2. Occupation:1. Government Service

2. Private

3.

4. Others

Businessman

3. Income:1. 2.5 – 3.5 lakh

2. 3.5 – 4.5 lakh

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

3. 4.5 – 5.5 lakh

4. 5.5 – 6.5 lakh

5. Above 6.5 lakh 4. Expenditure monthly:1. Less than 10,000

2. 10,000 – 20,000

3. 20,000 – 30,000

4. More than 30,000

5. In which bank do you have saving account? 1. Standard Chartered Bank 3.

ICICI Bank

5.

Other

2. HDFC 4. ABN – AMRO Bank

6. Which type of saving account do you have? 1. Zero Balance

2. Minimum 10,000

3.

4. More than 50,000

Minimum 50,000

7. Which feature do you like most in your bank? 1. Largest ATM Network

2. 24 / 7 Internet Banking

3.

4. Others

Service

8. If you want to switch on to other bank, which bank will you preferred? 1. Standard Chartered Bank 3.

ICICI Bank

5.

Others

2. HDFC 3. ABN – AMRO Bank

9. Why will you preferred? 1. Banking Service

2. 24/7 Internet Banking

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

3.

Largest ATM Network

4. Others

Annexure – 2

Service

Charges

of

Standard

Chartered

Bank’s

Saving

Account:-

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Parameter/ Saving Account

aXcess Plus

Super Value

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2-in-1

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

AQB A/c Maintenance Charges

Rs.10,000

Rs.50,000

If AQB< 5,000

1,500

1,250

If AQB≥ 5,000 & <7,500

1,250

1,250

If AQB≥ 7,500 & <10,000

750

1,250

If AQB≤ 10,000 & <25,000

1,000

If AQB≥ 25,000 & <50,000

750

Rs.100,000

750

If AQB < 100,000 Account Statements

Free/Quarterly Free/Qua

Free/Qua.

Duplicate Statement Account closure

100/500/-

100/500/-

100/500/-

Issued by customer

300/-

300/-

300/-

Deposited by customer Dormant Account

100/1000/-

Free per 1000/-

annum

annum

Debit card annual fee

200/-

Free

200/-

Debit card replacement fee

200/-

Free

200/-

Gold debit card 1st year fee

799/-

799/-

799/-

Gold debit card annual fee Demand Draft

799/-

799/-

799/-

0.25%

Free

0.25%

0.30%

0.25%

0.30%

(Within 6 months) Cheque Return 100/per

Cards

Drawn

at

own

bank(min.

Free50/- & max. 1,500/-) Drawn at other bank (min. Fee 250/-)

Cancellation 250/Pay order 75/ATM Uses other than SCB First

Branch

250/Free 4 Free

250/75/Free

140/50/100/-

140/50/100/-

transaction

VISA ATMs outside India Replacement of PIN Lost card re-issuance Standing instruction

free 140/50/100/-

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Setting up charges

100/-

100/-

100/-

Execution fee Banker’s report Signature verification Remittance from abroad

25/50/25/250/-

25/Free Free 250/-

25/50/25/250/-

Annexure – 3 Important Details of the ‘Bajaj Allianz New UnitGain’ Plan Parameter Minimum Age at Entry

Details 0 years, risk commences at age 7.

Maximum Age at Entry

(18 years in case of all Additional Rider Benefits 60 years (50 years in case of all Additional Rider

Minimum Maturity Age Maximum Maturity Age Additional Rider Benefit

Benefits) 18 years 75 years 65 years for all riders except UL WOP

Ceasing Age Minimum Premium

Rs. 10,000 per yearly instalment,

(for Male lives)

Rs. 5,000 per half-yearly instalment, Skyline Business School, Gurgaon

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

Rs. 1,000 per monthly mode Minimum Premium

Minimum Top Up Premium is Rs. 5,000 Rs. 7,500 per yearly instalment,

(for Female lives)

Rs. 3,750 per half-yearly instalment, Rs. 750 per monthly mode Minimum Top Up Premium is Rs. 5,000. (Monthly mode for both male and female lives is available

Minimum Sum Assured Maximum Sum Assured

through

ECS

and

Salary

Saving

Scheme only). 0.5 * Policy Term * Annualized Premium Multiplier * Annualized Premium (Multiplier would depend on the age at entry and any riders chosen)

Annexure – 4

Comparison of various bank’s Service and Charges with Standard Chartered Bank.

Standard Chartere d ICICI

S .no Features 1 2

Avg.Quaterly Bal. Rate of Interest

10,000 3.50%

10000 3.50%

3 4 5

Internet Banking Doorstep Banking Phone Banking Standing Instructions DDs n payorders

Free Free Free

Free Free Free 125+25per tr. 2/- per 1000

6 7

Free

Skyline Business School, Gurgaon

ABN AMRO

HDFC

(ADB)10000 3.50% 25(Per month) Free 100

5000 3.50%

50 50

150+25 Free

Free free 50

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8

9 10 11 12 13 14 15 16 17 18 19

20

21 22 23

24

Acc. Maintainace charges (a) AQB<5000 (b)AQB>or=5,000& <7000 (c)AQB>or=7,500& <10000 (d)AQB>or=10,000 Quarterly Statement Monthly Statement Duplicate Statement Pass Book Duplicate Pass book Cheque book ATM card ATM card usage outside India Debit card(Per year) Gold Debit card(Per year) Lost Card re-issue (a) ATM Card (b) Debit card (c) Gold Debit card Manual cash withdrawal (a) within India (b) outside India Replacement of Pin Account closure Stop Payment (a) Single cheque (b) range of cheques Cheque return (a)issued by customer (b)deposited by customer

1,500

750

500

750

1,250

750

500

750

750 0

750 0

500 0

750 0

Free Free

Free Free

Free Free

free free

100/150 Free

100 Free

100

100 Free

Free Free

100 Free Free

50 Free

Free Free

140 200

100 99

799 100 200 799

180

110

400

500

200 200

100 100 500

Free 500

25 50

500

25 100

100

100

100

50

200

100

100

100

300

350

350

350

100

100

100

125+ charges

200

100 150

100 150+other (c ) Foreign banks currency cheques charges

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Study of Saving Account in SCB & Comparative Analysis of its With Some Private Leading Banks

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