A

Project Study Report

On
Training undertaken at

HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED

Titled
“COMPARATIVE ANALYSIS OF INVESTMENT AVENUES AND
RESEARCH ON RESOURCE MOBILISATION”

Submitted in partial fulfillment for the

Award of degree of
MASTER OF BUSINESS ADMINISTRATION

Submitted By: - Submitted To: -

Puneet Rawat Ms. Mahima Rai
MBA Semester 3rd H.O.D ~ AIMS

2008-2010

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 APEX INSTITUTE OF MANAGEMENT & SCIENCE, JAIPUR
(Affiliated to University of Rajasthan & Rajasthan Technical University)
Approved by AICTE, Ministry of HRD, Govt. of India

PREFACE

Training is an important part of our Management curriculum. Th e MBA courses help a

student in getting acquainted with the manner in which his/her knowledge is being
practically used at a large scale. Hence, students switch from the process of learning to
implementing his/her knowledge, him /her abrupt change. This Training reports describes
each and every detail of work I performed to make a successful competition of the project.
This report also gives you a brief idea of how I moved ahead step by step reaching to
specify height and ultimate completing the goal.
The aim of this project is to develop awareness among the people regarding Financial
Avenues especially Fixed Deposits.

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 ACKNOWLEDGEMENT

I express my sincere thanks to my Project guide at HDFC, Mr. NEERAJ PACHOURI,

Designation Officer Operation, for guiding me right from the inception till the successful
completion of the project. I sincerely acknowledge him for extending their valuable
guidance, support for literature, critical reviews of project and the report and above all the
moral support he had provided to me with all stages of this project.
I would like to extend my deep sense of gratitude towards, Mr. AMIT DAGA (CA),
Manager~ Operation & Resources, HDFC Ltd., for his help and guidance.
I would also thank to the supporting staff, for their help and cooperation throughout the
project.
In Last I would remain ever thankful to my family, friends and everyone who may have
helped me directly or indirectly during the course of this project.

(Signature of Student)

PUNEET RAWAT
AIMS - JAIPUR

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 EXECUTIVE SUMMARY
The following report is a part-fulfillment of the work done at HDFC Ltd. as a management
trainee. The report is based on the project titled “Comparative Analysis of Investment
Avenues and Research on Resource Mobilization”. The area of work for this project is
“Market Research for the business of Fixed Deposits”.
The company HDFC Ltd. is majorly into the business of home loans and as part of its fund
raising process for disbursement of home loans, it has quite recently started to accept fixed
deposits from the public.
In this way, the company can successfully reduce its cost of operation. However, since the
present contribution of the fixed deposits to the total amounts of loan disbursed is merely
30% therefore the main purpose of undertaking this project revolves around to increase the
business of FDs for the company.
Under Competitive Analysis – 14 Banking Sector competitors and 10 Non-Banking Sector
competitors have been studied focusing upon – the product features, various schemes
under the same product, Rate of Interest, Commission rates, Incentive Plans etc. and then
basing on which analysis have been drawn.
The source of data was through personal visits to each of the institution and was based on
open-ended interview sessions with officer in charged with the department of fixed deposits.
The analysis part is inclusive of – Cross Tabulation Comparisons, Tick Box Comparisons
and a 3-Step analysis process constituting – Identifying key problematic area in the
operation of the business, To find a rational solution concerning the problem and finally to
shape the solution according to the feasibility criteria of the company considering its
limitations and constraints.
Under the study of Active KPs, the source of data was personal interaction with the key
partners and filling of questionnaires, so designed. The analysis from the study of active
KPs includes – identifying the key problematic areas that they KPs face in their dealing with
the company, the strength areas of the company and perception mapping analysis.

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 CONTENT TABLE

Preface
Acknowledgement
Executive Summary
Contents
1. Introduction to the Industry 7
2. Company Profile 15
3. Research Methodology 23
3.1 Title of the Study
3.2 Duration of the Project
3.3 Objective of Study
3.4 Type of Research
3.5 Sample Size and Method of selecting sample
3.6 Scope of Study
3.7 Limitation of Study
4. Facts and Findings 28
5. Analysis and Interpretation 55
6. SWOT Analysis 66
7. Conclusion 68(a)
8. Recommendation 68
9. Suggestions 70
10. Appendix 72
11. Bibliography 78

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 INTRODUCTION TO INVESTMENT INDUSTRY
India Financial Market promotes the savings of the economy, providing an effective channel
for transmitting the financial policies. It is a well-developed, competitive, efficient and
integrated financial sector. There are large numbers of buyers and sellers of the financial
product, the prices are fixed by the market forces of demand and supply within the Indian
Financial Market. The other markets of the economy assist the functioning of the financial
market in India.
FINANCIAL AVENUES
There are many types of financial investment avenues such as Insurance, Saving a/c’s,
Government bonds, Postal savings, Mutual funds and Shares/Stock Market, Fixed Deposits
etc. Every individual as got his own mode of investment and their own reasons of investing.
There are many more tools to invest and each & every investment avenue got its own
importance and returns. Various investment Avenues listed are:-
1. Insurance
2. Mutual funds
3. Bond market
4. Stock (Equities) Market
5. Foreign Exchange market
6. Money market
7. Commodity market
8. Real Estate market
9. Bullion Market
10. Fixed Deposits

1. INSURANCE
Insurance is a form of risk management, primarily used to hedge against the risk of a
contingent loss.
Insurance is a contract between an individual (Insured) & an insurance company (Insurer).
The insurance rate is a factor used to determine the amount to be charged for a certain
amount of insurance coverage, called the premium.
In Insurance, in return for the payment of premium by the insured, the insurers pay the
financial losses suffered by the insured as a result of the occurrence of unforeseen events.
Insurance is defined as the equitable transfer of the risk of a loss, from one entity to

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another, in exchange for a premium, and can be thought of as a guaranteed small loss to
prevent a large, possibly devastating loss.
Insurance companies may be classified into two groups:
 Life insurance companies, which sells Whole life assurance plan, Endowment
Assurance plan, term assurance plan, Plans for children, Pension plans etc
 Non-life, General, Property/Casualty insurance companies, which sell other
types of insurance.

2. MUTUAL FUNDS
Mutual funds is a company (collective investments) that gathers (pools) money from many
investors and invests in stocks, short-term money market financial instruments, Equity,
Debentures, Bonds and other securities and distribute the proceeds as Dividends.
The Mutual Funds in India are handled by Fund Managers, also referred as the Portfolio
managers.
In India Mutual Funds are regulated by SEBI. The Share value of the Mutual Funds in India
is known as Net Asset Value per Share (NAV). The NAV is calculated on the total amount
of the Mutual Funds in India, by dividing it with the number of shares issued and
outstanding shares on daily basis.
TYPE/ SCHEMES OF MUTUAL FUNDS
The mutual fund schemes can be classified according to their Investment Objective:-
According Life Span
1. Open-Ended: - Funds whose units can be freely sold & purchased by investors.
a. These Funds are not listed in stock exchange & no. of MF’s are unlimited.
b. Provides instant liquidity as investor can redeem in matter of 2-3 days.
2. Close-Ended: - Funds have fixed no. of units & fixed tenure (3, 5, 10, 15 yrs).
a. After maturity units are redeemed or made open-ended.
b. Conservative approach; declare dividend annually or Semi-annually.
According Income Objectives
1. Growth Funds aim to provide capital appreciation over a long-term.
2. Income Funds provide regular & steady income viz. debenture, Bonds G-sec etc.
According Portfolio Objectives
 Equity Funds are those that invest in Shares or Equity of companies.
 Debenture Funds are those that invest in debenture of company.

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  Balanced Funds are combination of both Stocks and Debentures. The aim is to
provide both Growth & Regular income also called as Ideal funds.
According Load Basis
1. Load Funds are those who charges commission for entry & exit. It means
commission is payable on purchase or sale of units of funds.
2. No-Load Funds are those that don’t charge a commission for Entry & Exit.
Special Schemes
 Industry Specific schemes invest only in the industries specified in the offer
documents. Industry like Info Tech, FMCG etc.
 Index Funds schemes uses particular index for investment such as BSE, NSE etc.
 Exchange Trend Funds are a type of funds that aims to achieve the same return as
a particular market index.
 Gold Trade Funds are schemes that invest in primarily Gold & its related
instruments.

3. BOND MARKET
The bond market (also known as the debt, credit, or fixed income market) is a financial
market where participants buy and sell debt securities, usually in the form of bonds.
"Bond market" usually refers to the government bond market, because of its size, liquidity,
lack of credit risk and, therefore, sensitivity to interest rates. Because of the inverse
relationship between bond valuation and interest rates, the bond market is often used to
indicate changes in interest rates or the shape of the yield curve.
Types of Bond markets
Securities Industry and Financial Markets Association classify the bond market into 5:-
1. Corporate
2. Government & agency
3. Municipal
4. Mortgage backed, asset backed, and collateralized debt obligation
5. Funding

4. STOCK MARKET
A stock market is a public market for the trading of company stock and derivatives at an
agreed price; these are securities listed on a stock exchange as well as those only traded
privately.
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India stock market offers a great opportunity to the investors as right now it is experiencing a
boom in many of its shares. The healthy banking and monetary services have secured the
investment possibilities in the Indian Stock Market to a large extent.
The Bombay Stock Exchange BSE, the oldest organization in Asia, gives information about
the prices of the shares of the Stock Market in India. The other organizations highlighting on
the share trading in the Indian Stock Market is National Stock Exchange of India (NSE).
The Nifty and the Sensex are the indicators which are the parameters denoting the prices of
the stocks of the major companies of the NSE and the BSE respectively.
SEBI~ Securities and Exchange Board of India which supervises the functioning of the Stock
markets in India.
The Indian Equity Market is also called as Indian share market or Indian stock market. The
forces of the market depend on monsoons, global funding flowing into equities in the market
and the performance of various companies.
SHARES: - A share is one of a finite number of equal portions in the capital of a company.
The income received from shares is called a Dividend, and a person who owns shares is
called a Shareholder.
Types of Shares
There are two types of shares under Indian Company Law:-
1. Equity shares mean that part of the share capital of the company which are not
preference shares.
2. Preference Shares means shares which fulfill the following 2 conditions.
 It carries preferential rights in respect of Dividend at fixed rate.
 It also carries preferential right in regard to payment of capital on winding up.
Types of Preference Shares
 Cumulative or Non-Cumulative
 Redeemable and Non- Redeemable
 Participating Preference Share or Non-Participating Preference Shares

5. FOREIGN EXCHANGE MARKETS

The Foreign Exchange market is where currency trading takes place. It is where banks and
other official institutions facilitate the buying and selling of foreign currencies. FX transactions
typically involve one party purchasing a quantity of one currency in exchange for paying a
quantity of another.

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Presently, the FX market is one of the largest and most liquid financial markets in the world,
and includes trading between large banks, central banks, currency speculators, corporations,
governments, and other financial institutions. The average daily volume in the global foreign
exchange and related markets is continuously growing.
The foreign exchange market is unique because of
 its trading volumes,
 the extreme liquidity of the market,
 its geographical dispersion,
 Its long trading hours: 24 hours a day except on weekends.

6. MONEY MARKET
The money market is the global financial market for short-term borrowing and lending. It
provides short-term liquidity funding for the global financial system. The money market is
where short-term obligations such as Treasury bills, commercial paper and bankers'
acceptances are bought and sold.
The money market consists of financial institutions and dealers in money or credit who wish
to either borrow or lend. Money market trades in short-term financial instruments commonly
called "paper."
The core of the money market consists of banks borrowing and lending to each other, using
commercial paper, repurchase agreements and similar instruments.
The performance of the Indian Money Market is heavily dependent on real interest rate that
is the interest rate that is inflation adjusted. Though the money market is free from interest
rate ceilings, structural barriers and other institutional factors can be held responsible for
creating distortions in India Money Market.

7.COMMODITY MARKET
The vast geographical extent of India and her huge population is aptly complemented by the
size of her market. The broadest classification of the Indian Market can be made in terms of
the commodity market and the bond market. Here, we shall deal with the former in a little
detail.
The commodity market in India comprises of all palpable markets that we come across in
our daily lives. Such markets are social institutions that facilitate exchange of goods for
money. The cost of goods is estimated in terms of domestic currency. India Commodity

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Market can be subdivided into the following two categories:
 Wholesale Market
 Retail Market

8. REAL ESTATE MARKET

Real estate is a legal term, which refers to Immovable properties. The term real estate
covers land accompanied with anything perpetually attached to the land, for example
buildings, malls, commercial hubs etc.
Real Estate Market is in its full swing with residential developments, malls, commercial
centers, IT hubs. The demand for houses has increased with increase in population and the
real estate developers are building luxurious as well as affordable projects to meet this rising
demand. India is also a commercial hub and along with the IT centers, many shopping malls
and other recreational centers are coming up as well.

9. BULLION MARKET
The meaning of the word “Bullion” is a mass of precious metal, primarily ' gold & silver' that
can be cast into ' ingots ' or ' coins '. The defining attribute of bullion is that it is valued by its
mass and purity rather than by its face value as in the case of money. In short, the amount
of bullion owned by a nation is precisely the intrinsic valuation of the amount of gold
reserves that a country has owned.
It is used as an indicator of the wealth possessed by a nation. Needless to say that the
market is under the strict supervision of the Central Government.
Gold is having to compete with investment in stock market, industries, and a wide range of
durable consumer goods, the rural people till date prefer to invest in 22 carat jewellery.
In present day context, the following statements hold true:
 Gold is being valued in India as a secondary source of investment after bank
deposits.
 According to WGCR, India has the single largest market consumption of gold.
In many countries, people have been trusted Gold as abetter investments than bonds &
stocks especially when stock market falls abruptly, gold & silver an important & popular
investment due to the following reasons:
 Highly liquid & low trading commission
 Good hedge against inflation

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  High prestige values (jewellery) & Offers convenient way of storing health.
 Possess high degree of money’s worth.
 Free from scams

10. FIXED DEPOSIT

FIXED DEPOSITS: - A Fixed Deposit defined as a Term Deposit which allows us to deposit
money for a fixed time period. When the deposit period elapses, the depositors get interest
on the amount deposited. The fixed deposit interest rates can be as high as 10.5% or more
but recently it dips to the 7-8% only. Just deposit your savings at a bank of your choice and
watch your money grow over time. Senior citizens prefer this investment as there are hardly
any hassles and problems in managing it. Persons interested in investment with the
objective of liquidity and mobility also find this investment very lucrative.
Assured return schemes have suddenly emerged as the most sought after investment
avenues among investors. This is not surprising given the extent to which investors have
lost their money in the recent crash in stock markets, properties, derivatives and certain
fixed income products; which has ultimately propelled investors to look for safer investment
options.
Various companies raise money through the route of company fixed deposits. The features
of all these deposits are same; the only difference is being the entity that is issuing the
deposit, so there will be a difference in the risk element for the investors in these deposits.
Fixed Deposit-REVIEW
A fixed deposit account allows one to deposit your money for a set period of time, thereby
earning a higher rate of interest in return. Fixed deposits also give depositor a higher rate of
interest than a savings bank account.
FDR’s- BENFITS
Variable deposits periods ranging from 12 months to 120 months in non-banks and
from 7 days to 10 years in banking institutes.
The FDs assures the repayment of accrued higher interest and principal amount.
The principle amount is safe in FDs as there is an investment avenue of very low risk
as compared to other investment option available in market.
Option to withdraw the deposit at any time before maturity without any difficulty.
Deposit avail loans upto 75-90% of the principal.
Higher Safety: Ensures safety of money.

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FDR’s – MINIMUM RANGE
The minimum deposit amount is Rs.5, 000/- in major banks and Rs.10, 000/- or more in non-
banking institutes and can be made in multiples of Rs.100/- or more-varies from company to
company Fixed Deposits.
FDR’s - ASSURANCE
There is fully safety in the case of banks as bank FD are insured under the Deposit
Insurance & Credit Guarantee Scheme Of India (DICG) in which deposit are insured upto
Rs.1Lakhs will be paid back to depositors but beyond that depends on financial position of
insolvent bank. Company Fixed Deposits are unsecured instruments, i.e. there are no
assets backing them up. It depends on the strength of the company and its ability to pay
back deposit at the time of its maturity. While investing in an NBFC, always remember to
first check out its credit rating. Also, beware of NBFCs offering ridiculously high rates of
interest.
RISKY FDR’s
Companies which pay a rate of interest higher than 11%, Companies which are not paying
regular dividends to its shareholders. New companies belonging to first generation of
promoters, which have yet to prove their creditworthiness. It is best to avoid private limited
companies, and partnership firms and other un-incorporated bodies. Such companies are
under no obligation to publish their balance sheets working results and it is, therefore, very
difficult to judge their performance.

COMPANY PROFILE ~ HDFC LTD.

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The “HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED” was incorporated
on October 17th, 1977 with the primary objective of promoting Home ownership by providing
Long-term Finance to households for their housing needs. HDFC was promoted with an
initial share capital of Rs. 100 million.
HDFC the pioneer of housing finance in India has assisted more than 3 million families to
own a home of their own, through housing loan approvals of over Rs.1, 647 billion. It has
consistently striven for and developed an excellent reputation for professionalism, integrity
and an impeccable record of customer friendly services. It has turned the concept of
housing finance for the growing middle class in India into a profitable, professionally
managed, world class enterprise.
HDFC’s main objective is to enhance residential housing stock and promote home
ownership. Another objective is to increase the flow of resources to the housing sector by
integrating the housing finance sector with the overall domestic financial markets.
HDFC offerings range from hassle-free home loans and deposit products, to property
related services and a training facility. HDFC is the owner corporation of a mighty empire.
It has 7 wholly owned and 10 other subsidiaries.
HDFC has Solid Financial Base it is proven only by that in March 2008, after deducting the
taxes the net profit is of Rs. 2436 crores however during the recession period in March 2009
it declines to 2282 Crores. HDFC balance sheet size exceeds to 1, 00,000 crores.
HDFC as a brand is a synonym of efficiency, which is reflected through the fact that it has
got lowest NPA (Non-Performing Assets) in the entire global economy at the rate of 0.84 %
and now according to the recent reports it decreases to 0.56% only.
HDFC enjoys an “AAA” credit rating from two most reputed credit rating companies of the
country – CRISIL and ICRA since past 15 Years; which is a commendable achievement in-
itself. This rating represents the ‘HIGHEST SAFETY’ as regards timely repayment of
principal & interest. Such ratings focus on the company’s attribute of a stable, consistent
and safe player.
HDFC has been recognized among India’s Best Managed Companies and today has
emerged as a financial conglomerate by promoting a bank, insurance companies (for life
and general), an asset management company, a realty company, a credit bureau and a real
estate venture capital company.

HDFC has employee strength of 1490 (as on 31 st March) includes professionals from the
fields of finance, law, accountancy, engineering and marketing; they are dedicated work-
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personnel and always keen to serve their clients with their best of ability. It also has one of
the lowest turn-around of serving clients of about 15 minutes only as all the companies
processing is hassle-free, with no processing fees and minimum documentation is required.
It has a network of 280 offices across country, with 14 branches in the state of Rajasthan.
HDFC Ltd. believes in consistent performance which is created by the right combination of
these 4 features:
1. SAFETY
2. SECURITY
3. LIQIDITY
4. RETURN
SUBSIDIARIES & ASSOCIATES COMPANIES
HDFC Ltd is the parental companies under which there are so many subsidiaries & other co-
promoted companies works in different fields of finance.
1. HDFC Asset Management Co. Ltd
2. HDFC Bank
3. HDFC ERGO General Insurance Company Limited (formerly HDFC General
Insurance company Limited)
4. GRUH Finance ltd.
5. HDFC Mutual Fund
6. HDFC Standard Life Insurance Company
7. HDFC Venture Capital Ltd.
8. Other Companies Co-Promoted BY HDFC
1) HDFC Developers Ltd.
2) HDFC Holdings Ltd.
3) HDFC Investments Ltd.
4) Home Loan Services India Pvt. Ltd
5) HDFC Property ventures Ltd.
6) HDFC Realty Ltd.
7) HDFC Sales Private Limited
8) HDFC Subsidiary Life Insurance Co. Ltd
9) HDFC Trustee Co. Ltd.
10)HDFC Ventures Trustee CO. Ltd.

HDFC LTD. - PRODUCT LINE

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HDFC Ltd. basically deals with two main products
HDFC HOME LOANS
HDFC FIXED DEPOSITS
HDFC HOME LOANS
The business of HOME LOANS deals with sanctioning of loans against mortgage of the
property. HDFC earned an experience of 32 years in home loans & their loan product is
customised to provide solutions to customer unique concern.
TYPES OF HOME LOAN
1) Home Improvement Loan
2) Home Extension Loan
3) Short Term Bridging Loan
4) Land Purchase Loan
5) Existing Loan Customers
6) Loans to Professionals for Non Residential Premises Loan
7) Home Equity Loans

HDFC FIXED DEPOSITS

HDFC has instituted well-defined service standards for both Depositors and Deposit agents
(Key Partners). HDFC has been able to mobilise deposits from over 10 lakhs Depositors.
Outstanding deposits grew from Rs. 1,458 crores in March 1994 to 11,278 crores in March
2008. Much of this success can be attributed to its strong Brand Image, Superior Services,
Security and above all, the significant contribution made by HDFC's Deposit Agents. HDFC
has over 50,000 deposit agents and distributes all its retail savings (deposit) products
primarily through this channel.
The business of HDFC Fixed Deposits can be classified under as follows:-

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 FIXED DEPOSITS

INDIVIDUAL TRUSTS

REGULAR PREMIUM REGULAR PREMIUM

HDFC INDIVIDUAL DEPOSITS

Deposit s accepted directly from Individual or by the Key Partner for a Resident / Non-
Resident Individual, Minors through Guardian, Hindu undivided family.
1. FIXED RATE DEPOSITS
2. VARIABLE RATE DEPOSITS Variable Rate Deposit is a new addition to the wide
range of deposit products offered by HDFC to enable the depositors to take
advantage of movements in interest rates.
Following options are available under both Fixed Rate & Variable Rate Deposit –
a. Annual Income Plan
b. Monthly Income Plan
c. Non-Cumulative- Quaterly Plan
d. Non-Cumulative- Half Yearly Plan
e. Cumulative Deposits
FEATURES OF INDIVIDUAL DEPOSITS:-
1. DEPOSITS CAN BE PLACED BY:
Resident / Non-Resident Individuals, Minor through guardians, Hindu Undivided
Families.
2. MODE OF ACCEPTANCE:
Deposits can be made by cheques/DD, in favor of “Housing Development Finance
Corporation Ltd.” or “HDFC Ltd.” and should be marked “account payee”.
3. INTEREST:
Interest on deposits placed under Monthly Income Plan, Non-cumulative Option and

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 Annual Income Plan shall be paid on fixed dates as given below:
Monthly Income Plan Last day of each month
Non-Cumulative Option- March 31st, June 30th, September 30th,
Quarterly December 31st
Non-Cumulative Option- March 31st & September 30th
Half Yearly
Annual income Plan March 31st

4. ELECTRONIC CLEARING SERVICE(ECS):

This facility is provided to depositors in select centers whereby the interest will be
credited directly to the depositor’s bank account. There is no extra charge to it.
5. DEDUCTION OF INCOME TAX AT SOURCE (TDS):
Income tax will be deducted at source under Section 194A of the Income Tax Act,
1961at the rates in force. If the trust is not liable to pay income tax then the trust is
required to submit a declaration form in Form No. 15G so that income tax is not
deducted at source. Senior citizens may submit a declaration in form 15H.
6. PRE-MATURE WITHDRAWL:
The rules relating pre-mature withdrawal are as follows:
 No repayment within period of 3 months.
 After 3 months but before 6 months- NO INTREST PAID
 After 6 months but before maturity- 2% less than applicable ROI or 3% lower
than minimum rate if rate is not specified for any period i.e. for less than 12
months.
7. RENEWAL AND REPAYMENT OF DEPOSIT:
 For renewal, prescribed application form should be duly filled & be signed by
the depositors along with discharged deposit receipt.
 For repayment of deposit the duly discharged deposit receipt must be
surrendered to HDFC at least before the date of maturity.
 Renewal from date of maturity, irrespective of period lapsed since maturity.
 Advance renewal facility can be renewed one month in advance.
8. QUICK LOAN FACILITY AVAILABLE:
 Available after 3 months
 Upto 75% of Deposit amount
 ROI- 2% above the Deposits ROR
9. NOMINATION FACILITY:

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 Only individual depositor’s single or jointly, can nominate a single person under this
facility.

HDFC TRUST DEPOSITS

HDFC offers a wide range of deposit products, a secure investment option, with attractive
returns. Deposits are accepted from Charitable Trusts, Religious Trusts, Educational
Institutions, Employees' Welfare Trusts and others as decided by the management.
1. FIXED RATE DEPOSITS
2. VARIABLE RATE DEPOSITS Variable Rate Deposit is a new addition to the wide
range of deposit products offered by HDFC to enable the depositors to take
advantage of movements in interest rates.
Following options are available under both Fixed Rate & Variable Rate Deposit –
a. Monthly Income Plan
b. Non-Cumulative Deposits
c. Annual Income Plan
d. Cumulative Deposits
FEATURES OF TRUST DEPOSITS: -
1. DEPOSITS CAN BE PLACED BY:
Charitable Trusts, Religious Trusts, Association of Persons, Co-operative societies,
Partnership Firms and others as decided by the management.
2. MODE OF ACCEPTANCE:
Deposits can be made by Cheques/Demand Drafts/RTGS in favour of HDFC ltd.
3. INTEREST:
Interest on deposits placed under Monthly Income Plan, Non-cumulative Option and
Annual Income Plan shall be paid on fixed dates as given below:
Monthly Income Plan Last day of each month
Non-Cumulative March 31st, June 30th, September 30th,
Option- Quarterly December 31st
Non-Cumulative March 31st & September 30th
Option- Half Yearly
Annual income Plan March 31st

4. INTEREST RESET DATE FOR VARIABLE RATE DEPOSITS:

Rate of Interest (ROI) will be reset at the beginning of each interest period.
5. SAFETY AGAINST FRAUDULENT ENCASHMENT OF INTEREST WARRANTS:

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 To avoid fraudulent encashment of interest warrants/cheques the depositor should
provide details of bank, branch & account number in the application form, which will
be printed on front page of the interest warrant/ cheques.
6. ELECTION CLEARING SERVICE (ECS):
This facility is provided to depositors in select centers whereby the interest will be
credited directly to the depositor’s bank account. There are no extra charges levied
for this facility as per present RBI guidelines.
7. DEDUTION OF INCOME TAX AT SOURCE (TDS):
Income tax will be deducted at source under Section 194 A of the Income Tax Act,
1961 at the rates in force. If the trust is not liable to pay income tax then the trust is
required to submit a declaration form in Form No. 15G.
8. PRE-MATURE WITHDRAWL:
The rules relating pre-mature withdrawal are same as individual deposits.
9. RENEWAL AND REPAYMENT OF DEPOSIT:
 Same as the Individual deposits
10. QUICK LOAN FACILITY AVAILABLE:
 Available after 3 months
 Upto 75% of Deposit amount
 ROI- 2% above the Deposits ROR

INCENTIVE PLANS OF THE COMPANY

The company conducts two contests on monthly basis to motivate its agents. A format of
each of it is as follows:
HDFC DEPOSITS ~ Rs 5 LAKHS + CONTEST
ELIGIBILITY KPs who have mobilized Rs 5 Lakhs and above
during the given time period.
1 March 2009 till 10 March 2009
CONTEST PERIOD 11 March 2009 till 20 March 2009
21 March 2009 till 28 March 2009
APPLICABLE TO All office in Rajasthan

CONTEST PRIZE
DEPOSIT AMOUNT MOBILIZED PRIZE AMOUNT (RS)
Rs 5 lakhs to 9.99 lakhs 250

~ 21 ~
 Rs 10 lakhs to 14.99 lakhs 750
Rs 15 lakhs to 24.99 lakhs 1000
Rs 25 lakhs & above 1250

HDFC DEPOSITS ~ “MONTHLY TOP 5” CONTESTS:-

ELIGIBILTY KPs who have mobilized Rs 6 lakhs and above
during the month
CONTEST PERIOD 31 March 2009
APPLICABLE TO All offices in Rajasthan

CONTEST PRIZE
RANK CONTEST PRIZE AMOUNT
1 1500
2 1250
3 1000
4 750
5 500

RESEARCH METHODOLOGY
3.1 TITLE OF THE PROJECT
The project report on the “COMPARATIVE ANALYSIS OF INVESTMENT AVENUES AND
RESEARCH ON RESOURCE MOBILISATION” is based on the study of various features
of fixed deposits and management of different channels for mobilization of fixed deposits.
This project highlights the other financial avenues and shows how the Fixed Deposits are
beneficial over other.

~ 22 ~
In market, powerful competitors are classified into 2 major classes namely: Banks & Non-
Banking institution. HDFC Ltd. face tough competition from banking sector & from its own
field of Non-Banking sector inspite of all these the major competitor of HDFC Ltd. is Post
Offices etc. The bank companies accept deposits directly by the investor in the form of
cash/cheques/DD, but in Non-Banking sector there is also an option middleman which is
simple called as AGENTS & technically called as KEY PARTNERS (KPs). Non-banking
companies accept deposits through these agents or key partners and they are really loyal
towards their clients.
The KPs have a significant role to play in bringing the deposits contributing to the business
of fixed deposits of company, in place of which they get brokerage rate or commission with
attractive incentive packages. Beside this, the company also attracts & retains KPs by
conducting the certain CONTEST for the active key partner. The company mainly deals
with through Key Partners and they generate the business of 75% of overall deposits.

3.2 DURATION OF THE PROJECT

The duration of project is 40 days from 18th May, 2009 to 26 June, 2009.

3.3 OBJECTIVE OF THE PROJECT

There are 4 main objective of the project work. They are as follows:
1. To draft a feasible plan of action meant to attract potential KPs so that they actively
contribute to the business.
2. To study the active KPs and to find out the main strength areas of the company so
that they can be further built upon.
3. To do a competitive analysis for the company and find out the nature of products and
incentive schemes offered by competitors.
4. To draw a feasible plan to increase the visibility and reach of the company with
respect to its competitors.
The first objective aims at creating a feasible plan of action as to how the current problem
can be eliminated and the target of increasing the market share can be achieved.
The second objective will help the company to know the main strengths that do have an
impact in creating a unique position in the minds of its Key Partners. It is requisite as the
identified strengths can further be built upon to maintain and enhance good relations and
satisfy its customer better.

~ 23 ~
The third objective deals with one of the most important aspect of problems i.e. to analyze
competitors of the company and find what are the current features and additional benefits
that they provide above HDFC Ltd. This would help to identity main flows and suggest
those features that need to be incorporated in the present range of product to improvise it
further.
The fourth objective deals with the latent motive of making its presence felt by the public
with respect to its competitors. The area of work will be to draw a plan as to how to increase
the popularity of the product focusing on the strength of company so as to increase the
demand for the company’s product.

3.4 TYPE OF RESEARCH:

Exploratory and Descriptive research
The research is mainly both exploratory and descriptive in nature, information is
been gathered by both primary and secondary sources. The secondary data has been
taken by visiting the most of the bank & NBFC’s and also internet is used for getting the
facts & figures required for the research purposes. The objective of the exploratory
research is to gain insights and ideas. A well structured questionnaire was prepared for the
primary research to collect the perception of the Active Key partners.

3.5 SAMPLE SIZE & METHODOLOGY OF COLLECTING DATA:

The area of work is regarding Market Research of Fixed Deposit for HDFC Ltd. The
methodology of data collection of the work done so far is as follows:
1. COMPETITIVE ANALYSIS
FOR BANKING SECTOR COMPETITORS:
SOURCE OF DATA  Personal visits to the particular bank and meeting
with the concerned officer.
 Websites of that particular bank.
SAMPLE SIZE  14 Top Rated Banks
ANAYSIS OF DATA  Cross – Tabulation Comparison
 Tick Box comparison
FOR NON-BANKING SECTOR COMPETITORS:
SOURCE OF DATA  Personal visits to the particular institution and
meeting with the concerned officer.
 Websites of that particular institute.
SAMPLE SIZE  10 Non-Banking Financial Companies

~ 24 ~
 ANAYSIS OF DATA  Cross – Tabulation Comparison
 Tick Box Comparison

2. STUDY OF ACTIVE KEY PARTNERS

SOURCE OF DATA  Personal Interaction with the Key Partners and
interviewing them.
 Filling of questionnaire so designed.
SAMPLE SIZE Restricted to100 respondents
ANAYSIS OF DATA  Perception Mapping and compilation of data through
pie-charts.
 Identifying the strengths and problems relating to the
working module of the company based on the
interaction with KPs.

3.6 PURPOSE/SCOPE OF THE PROJECT

The company HDFC Ltd. is a pioneer and leader in housing finance industry. It has two
main products - Home Loans and Fixed Deposits.
Basically the company has its focus in the business of housing loans but as part of its fund
raising process for disbursement of home loans, HDFC also have quite recently started to
accept fixed deposits from the public.
Though the company is one of the highest mobilizes of fixed deposits outside the banking
system, yet its retail deposit as a component of total funding required for the year is around
30 % of the current year’s disbursements of loans, which is the prime area of concern as
they rest of the amount has to be gathered through sources of external loans, which
undoubtedly increases the liabilities and the cost of its operation. Thus, the focus of the
company is to minimize the same by increasing revenues through internal source i.e. -
through business of fixed deposits.
The business of FDs for the company is done mainly through agents called Key Partners or
KPs. Key Partners are classified into 2 classes on the basis of the amount mobilized of
fixed deposits they made in the last financial year:
1. Active Key Partners
2. In-Active Key Partners
Active key partners are current asset of the company which makes the company to grow
and spread good word of mouth in the market.

~ 25 ~
The company offers enough flexibility to its agents as they are not bound by any legal
limitation to do business with them only, i.e. they can do similar natured work for their
competitors as well. Also no minimum educational qualification is required to become an
agent. But because of lack of any legal limitation to restrict these agents to do business with
them only; the problem that had cop up is that a major chunk of these KPs have become
INACTIVE and draw little or no business for the company but are drawing huge business
for their competitors, which is a Serious Cause of Concern and one of the biggest
hindrance in the goal of the company to increase the business of fixed deposits.

3.7 LIMITATIONS OF THE PROJECT

The area of work for project is bounded by certain limitations. They are as under:
1. The data collected is confined to one state only due to limited resources (both
manpower and capital), is also not of entire population as a random list of sample of
active KPs was taken from the company’s database which adds on to the fear of
sample being not truly expressive.
2. Also while studying the Active KPs-- aiming to find the strength areas of the
company the data so collected was drawn out of a random sample of company’s
database, also since at times it was difficult to get co-operation from sample to get
the requisite feedback the data so collected may not be representative of the entire
population.
3. HDFC Ltd. is basically a Non-Banking Financial Institution which is governed by NHB
(National Housing Bank) but the business of Fixed Deposits undoubtedly suffers a
stiff competition from Banking Sector. So while doing the competitive analysis
comparison has been made between banking and non-banking sector which may
appear arbitrary and irrational.
4. Also while doing the competitive analysis some of the non-banking financial
institutions did not share their specific details specially relating to the commissions
and the incentive plans due to their internal policies regarding security reasons, thus
the information was then collected from their agents and not from the companies
directly, through no compromises were made regarding the accuracy of the data.
5. While drafting the Visibility plans, the suggestions revolve around only those choices
that offer the advantage of being cost-effective even though they may not be the best
alternative plans. This is because of the fact that HDFC Ltd. as a company has a

~ 26 ~
 policy to offer a very little budget for such advertising plans which had limited the
options available.

FACT & FINDINGS ~ COMPETATIVE ANALYSIS

COMPETITOR IN THE MARKET

HDFC Ltd. being a major player in the market in the business of fixed Deposits is
consistently trying to make its product and schemes more valuable to its customer in order
to attract them. In the present scenario, people have starting investing their money in Fixed
deposits as it ensures fixed rate return on investment. If investment advisor are to be

~ 27 ~
trusted, FDs are being considered as the best option by the investors because of the
attractive rate interest as well as the current state of the market.
The market is full of options for the customer. A bunch of companies like TATA Motors Ltd,
ShriRam Transport Finance Company, Life Insurance Corporation Housing Company are
currently raising their Deposits by offering the interest rate from 9-12%. HDFC Ltd facing
tough competition mainly from the Non-Banking Institution which are offering higher rate of
interest, at greater risk about which customer is not aware. The company also faces
competition from the Banking Institutions because the banks are driving the business of
Fixed Deposits and has a great share in market.
So, the competitors of HDFC Ltd. are broadly classified into 2 groups:

BANKING INSTITUTE: - (Regulate as per RBI Guidelines)

It includes both nationalized and private Banks:
I. Nationalized Banks Are: Central Bank of India, State Bank of India, Union Bank of
India, State Bank of Bikaner & Jaipur, Bank of Baroda, Punjab National Bank,
Oriental Bank of Commerce, Canara Bank, Bank of India, IDBI Bank etc.
II. Private Banks Are: HDFC Bank, ICICI Bank, Axis Bank, ING VAYSYA Bank, Kotak
Mahindra Bank Ltd etc.
NON-BANKING INSTITUTE: - (Regulate as per NHB Guidelines)
It includes both nationalized and private Institutes: ICICI Housing Finance Company, TATA
Motors Limited, ShriRam Transport Finance Company, Life Insurance Corporation Housing
Company, Mahindra & Mahindra Financial Services Ltd., CENTBANK Home Finance Ltd.,
PNB Home Finance Ltd., and CAN-FIN Homes Ltd.

PROFILE OF COMPETITOR BANKS

HDFC Ltd. is facing competition from banks which offering Fixed Deposits at competitive
rate of interest to the customers. The study deals with the 14 major Banks listed below
which are competitive to HDFC Ltd. They are as follows:-
1. Axis Bank
2. Bank of Baroda (BOB)
3. Bank of India

~ 28 ~
 4. Canara Bank
5. Central Bank of India
6. HDFC Bank
7. Hong Kong & Shanghai Banking Corporation(HSBC) Limited
8. ICICI Bank
9. Kotak Mahindra Bank Ltd
10. Oriental Bank of Commerce (OBC)
11. Punjab National Bank (PNB)
12. State Bank of Bikaner & Jaipur (SBBJ)
13. State Bank of India (SBI)
14. Union Bank of India

AXIS BANK
Brief Profile: - Axis Bank was the first of the new private banks to have begun operations
in 1994, after the Government of India allowed new private banks to be established.
The Group's principal activities are to provide commercial banking services which include
merchant banking, direct finance, infrastructure finance, venture capital fund, advisory,
trusteeship, Forex, treasury and other related financial services. The Bank has strengths in
both retail and corporate banking and is committed to adopting the best industry practices
internationally in order to achieve excellence.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company have been categorized 4 different schemes are as:-
 Fixed Deposit.
 Recurring Deposit.
 Tax Saver Fixed Deposit.
 Encash 24.

BANK OF BARODA
BRIEF PROFILE:- Maharajah of Baroda Sir Sayajirao Gaekwad III founded the bank on
July 20, 1908 in the princely state of Baroda, in Gujarat. The bank, along with 13 other
major commercial banks of India, was nationalized on 19 July 1969, by the Government of
India. It has a wide network of over 2800 branches and about 1000+ ATMs.
Bank of Baroda offers a wide range of banking products and financial services to corporate
and retail customers through a variety of delivery channels and through its specialized
~ 29 ~
subsidiaries and affiliates in the areas of investment banking, credit cards and asset
management.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under 5 different schemes are as:
 FAST ACCESS DEPOSIT SCHEME
 REGULAR INCOME PLAN
 REGULAR INCOME CUM RECURRING DEPOSIT
 TAX SAVING TERM DEPOSITS
 RECURRING DEPOSITS

BANK OF INDIA
BRIEF PROFILE: - Bank of India (BOI) was established on 7 September 1906 and has
completed 103 years of its successful existence. The Bank was under private ownership
and control until July 1969 when it was nationalized along with 13 other banks, it was then
that it got the stature of being a commercial public sector bank.
The Company's principal activities are to provide banking and treasury services to
individuals and corporate clients. It provides short and long term loans to agricultural, small
scale industries and other priority sectors. The Bank has been the first among the
nationalized banks to establish a fully computerized branch and ATM facility at the
Mahalaxmi Branch at Mumbai way back in 1989.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under 5 different schemes are as:
 SHORT / FIXED DEPOSIT RECIEPTS
 QUARTERLY/ MONTHLY TERM DEPOSIT
 RECURRING TERM DEPOSIT
 STAR FLEXI--RECURRING DEPOSIT SCHEME
 STAR SUNIDHI TAX-SAVING DEPOSIT SCHEME

CANARA BANK
BRIEF PROFILE:-Canara Bank was founded as “Canara Bank Hindu Permanent Fund”
in 1906, by late Sri. Ammembal Subba Rao. In 1910 it became a limited company as
'Canara Bank Ltd.' in 1910 and became Canara Bank in 1969 after nationalization.

~ 30 ~
Sound founding principles, enlightened leadership, unique work culture and remarkable
adaptability to changing banking environment have enabled Canara Bank to be a frontline
banking institution of global standards.
The bank as of September 2008, has domestic presence of order- 2710 branches across
the country that include over 2000 ATMs- the highest among nationalized banks.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under the following 5 different schemes are:
 FIXED DEPOSIT
 RECURRING DEPOSITS
 CAN-TAX SAVER SCHEME
 ASHRAYA DEPOSIT SCHEME
 KAMADHENU DEPOSIT (Re-investment Plan)

CENTRAL BANK OF INDIA

BRIEF PROFILE:-Established in 1911, Central Bank of India was the first Indian
commercial bank which was wholly owned and managed by Indians. The establishment of
the Bank was the ultimate realization of the dream of Sir Sorabji Pochkhanawala, who
proclaimed the bank to be the 'property of the nation and the country's asset'.
Central Bank has been playing an increasingly active role in promoting the key thrust areas
of agriculture, small scale industries as also medium and large industries.
Central Bank of India has large network in 27 out of 28 States as also in 4 out of 7 Union
Territories in India. Central Bank of India holds a very prominent place among the Public
Sector Banks on account of its network of 3413 branches and 237 extension counters at
various centers throughout the length and breadth of the country.
Besides serving the public it also has many corporate clients some of them are themselves
banking institutes like- ICICI, HDFC, IDBI, UTI, LIC etc. which is a strong indicator of the
kind of repute it enjoys as a banking institute.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company have been categorized under 6 different schemes are:-
 MONEY MULTIPLIER DEPOSIT CERTIFICATE (MMDC)
 MONTHLY INTEREST DEPOSIT RECEIPT (MIDR)
 QUARTERLY INTEREST DEPOSIT RECEIPT (QIDR)
 CENTRAL'S SENIOR CITIZEN DEPOSIT SCHEME
~ 31 ~
  CENTRAL'S FLEXI YIELD DEPOSIT SCHEME
 CENT TAX SAVING DEPOSIT

ICICI BANK
BRIEF PROFILE: - ICICI Ltd. was formed in 1955 at the initiative of the World Bank, the
GOI and representatives of Indian industry. The principal objective was to create a
development financial institution for providing medium-term and long-term project financing
to Indian businesses. In 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 which was formulated in the year 1994.
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 specialized
subsidiaries and affiliates in the areas of investment banking, life and non-life insurance,
venture capital and asset management.
The Bank has a network of 1,419 branches and about 4,644 ATMs in India and presence in
18 countries.

ABOUT THE BUSINESS OF FIXED DEPOSITS:

The term deposits of the company categorized under the following 3 schemes are:
 ICICI Fixed deposit
 Security Deposit
 Tax Saver Fixed Deposit.

HDFC BANK
BRIEF PROFILE:-The Housing Development Finance Corporation Limited (HDFC) was
amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI)
to set up a bank in the private sector, as part of the RBI's liberalization of the Indian
Banking Industry in 1994.
The bank was thus incorporated in August 1994 in the name of 'HDFC Bank Limited', with
its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled

~ 32 ~
Commercial Bank in January 1995, with a simple mission to be “World Class Indian Bank”
with a single minded focus on product quality and service excellence.
HDFC Bank now, has 1,500 branches and over 2,890 ATMs, in 530 cities in India, and all
branches of the bank are linked on an online real-time basis.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under the following 4 different schemes are:-
 REGULAR FIXED DEPOSIT
 FIVE YEAR TAX SAVING FIXED DEPOSIT
 SUPER SAVER FACILITY
 SWEEP IN FACILITY

HONGKONG AND SHANGHAI BANKING CORPORATION (HSBC

BRIEF PROFILE: - HSBC's origins in India date back to 1853, when the Mercantile
Bank of India was established in Mumbai. The Bank has since, steadily grown in reach and
service offerings, keeping pace with the evolving banking and financial needs of its
customers.
HSBC today, has vigorously developed its role as one of the leading banking and financial
services organizations in the world. In India, the Bank offers a comprehensive suite of
world-class products and services to its corporate and commercial banking clients as also
to a fast growing personal banking customer base.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company are known by the name FIXED DEPOSITS. The main
features of this scheme are as follows:
 AMOUNT OF DEPOSIT – The minimum amount of deposit is Rs.10000/- and
there is no ceiling for maximum amount.
 PERIOD OF DEPOSIT – Tenure of deposit ranges from 15 Days to 10 Years.
 RATE OF INTEREST – ROI shall be rate prevailing on the date of deposit, which
varies according to the tenure, which shall be compounded quarterly.
 NOMINATION FACILITY – Nomination can make as per guidelines applicable.
 PRE-MATURE WITHDRAWAL – Pre-mature withdrawal is possible. Interest is
paid at the rate applicable for the period run, without penal cut on deposit
accounts closed prematurely.

~ 33 ~
  TAX IMPLICATION – Interest on these deposits shall be liable to tax under the
Income Tax Act. TDS will be applicable as per extant guidelines.
 AUTOMATIC RENEWALS – In case the customers have not withdrawn the
deposits after its maturity, the account shall be automatically renewed and
applicable interest shall also be provided.
 LOAN FACILITY – No loans or advance facility are available under this scheme.

KOTAK MAHINDRA BANK LIMITED

BRIEF PROFILE:-The Kotak Mahindra group is a financial organization established in
1985 in India. It was previously known as the Kotak Mahindra Finance Limited, a NBFC. In
February 2003, Kotak Mahindra Finance Ltd, the group's flagship company was given the
license to carry on banking business by the RBI. Kotak Mahindra Finance Ltd. is the first
company in the Indian banking history to convert to a bank.
Kotak Mahindra is one of India's leading financial organizations, offering a wide range of
financial services that encompass every sphere of life.
The group has a distribution network of more than 1300 branches, franchisees,
representative offices and satellite offices across cities and towns in India and offices in
New York, London, San Francisco, Dubai, Mauritius and Singapore.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company are known by the name FIXED DEPOSITS. The main
features of this scheme are as follows:
 AMOUNT OF DEPOSIT – The minimum amount of deposit is Rs.1000/- and
there is no ceiling for maximum amount.
 PERIOD OF DEPOSIT – Tenure of deposit ranges from 7 Days to 10 Years.
 RATE OF INTEREST – Rate of interest shall be the appropriate rate prevailing
on the date of deposit, which will vary according to the tenure of deposit, which
shall be compounded quarterly.
 NOMINATION FACILITY – Nomination available as per guidelines applicable.
 PRE-MATURE WITHDRAWAL – Pre-mature withdrawal is possible on demands
of the customers. Interest is paid at the rate applicable for the period run; without
penal cut on deposit accounts closed prematurely.
 TAX IMPLICATION – Interest on these deposits shall be liable to tax under the
Income Tax Act. TDS will be applicable as per extant guidelines.
~ 34 ~
  AUTOMATIC RENEWALS – In case the customers have not withdrawn the
deposits after its maturity, the account shall be automatically renewed and
applicable interest shall also be provided.
 LOAN FACILITY – Loan or overdraft facility is available upto 90% of the entire
deposit amount at nominal cost.

ORIENTAL BANK OF COMMERCE BANK

BRIEF PROFILE: - Oriental Bank of Commerce was established in 1943 in Lahore by
Late Rai Bahadur Lala Sohan Lal who was also the founder chairman of the bank. After the
Independence the head office was shifted to Amritsar. The OBC was nationalized in 1980.
OBC bank has been quite contributive towards national development by actively involving in
poverty elevating programs like – THE GRAMEEN PROJECT, the Scheme has a unique
feature of disbursing small loans to rural folks with high emphasis on working women.
It has also launched 'The Comprehensive Village Development Programme'. The
programme focuses on providing a comprehensive and integrated package providing rural
finance to the villagers with Village Development as its focus, thus contributing towards
infrastructural development and augmentation of income for each farmer of the village.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under 4 different schemes are:-
 TERM DEPOSIT
 FLEXI FIXED DEPOSIT SCHEME
 TAX SAVING TERM DEPOSIT
 PRAGATI DEPOSIT SCHEME

PUNJAB NATIONAL BANK

BRIEF PROFILE:-Established in 1895 at Lahore, undivided India, Punjab National Bank
(PNB) has the distinction of being the first Indian bank to have been started solely with
Indian capital. The bank was nationalized in July 1969 along with 13 other banks.
PNB can boost itself of a successful track record of 110 years and to possess largest
branch network in India- about 4525 Offices including 432 Extension Counters. Moreover,
it’s been listed amongst the 300 World companies & 7 Indian companies.
ABOUT THE BUSINESS OF FIXED DEPOSITS:

~ 35 ~
The term deposits of the company categorized under 5 different schemes are:-
 SPECTRUM FIXED DEPOSIT SCHEME
 ANUPAM ACCOUNT
 MULTI BENEFIT FIXED DEPOSIT SCHEME
 RECURRING DEPOSIT SCHEME
 SWECHHA JAMA YOJNA / FLEXI FIXED DEPOSIT

STATE BANK OF BIKANER AND JAIPUR

BRIEF PROFILE:-State Bank of Bikaner and Jaipur was established in 1963 after
amalgamation of erstwhile State Bank of Jaipur (established in 1943) with State Bank of
Bikaner (established in 1944) as a subsidiary of State Bank of India.
The Bank's main area of operation is Rajasthan, with presence at all important centers in
the country. The Bank has 860 branches consisting of 849 business branches, 8 service
branches, 2 asset recovery branches and 1 treasury branch and has sponsored 3 RRBs.
The Company operates in India only. Internet Banking has been extended to all our
branches for retail customers and select branches for corporate customers.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under the following 6 different scheme are:-
 Term Deposit Scheme
 SBBJ Flexi Deposit Scheme:
 Special Term Deposit Scheme
 Recurring Deposit Scheme
 Special Scheme For Senior Citizens
 SBBJ Tax Saving Term Deposit Scheme  

STATE BANK OF INDIA

BRIEF PROFILE: - The STATE BANK OF INDIA was established in the year 1973. SBI
is India's oldest and a premier Public Sector Bank which works actively in line to the
guidelines of Reserve Bank of India and also of Government of India.
SBI stands strong with about own 10000 branches and over 5100 branches of its
associated banks thus offering the largest banking network to the Indian customer. Today,
the Bank is the largest provider of infrastructure debt and the largest arranger of external

~ 36 ~
commercial borrowings in the country and is also the only Indian bank to feature in the
Fortune 500 list.
SBI also possess 7 Subsidiaries in India – SBI Capital Markets, SBICAP Securities, SBI
DFHI, SBI Factors, SBI Life and SBI Cards - thus forming a formidable group in the Indian
Banking scenario.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company have been categorized into 2 sub-categories. They are:-
 TERM DEPOSITS
 RECURRING DEPOSITS

UNION BANK OF INDIA

BRIEF PROFILE: - On the onset of 20th century Union Bank of India started its journey
in Indian Banking Sector and has completed successful 88 years of its existence and has
been firmly committed to consolidating and maintaining its identity as a leading, innovative
commercial Bank.
Union Bank is a Public Sector Unit with 55.43% Share Capital held by the Government of
India and rest is owned by eminent individuals who are experts in diversified fields of
Banking like Retail, SME, and Technology.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposits of the company categorized under 7 different schemes are:-
 CUMULATIVE DEPOSIT SCHEME
 DEPOSIT REINVESTMENT CERTIFICATE
 MONTHLY INCOME SCHEME
 UNION FLEXI-DEPOSIT
 UNION TAX SAVER
COMPARATIVE TABULAR PRESENTATION OF ROI OF DIFF BANKS:-
TABLE 1-
HDFC ICICI KOTAK UNION
TIME SLAB BANK BANK MAHINDRA BANK SBBJ
           
7- 14 Days 3.00 0.00 0.00 3.50 0.00
15-29 Days 3.50 3.75 3.00 3.75
4.50
30-45 Days 4.00 4.00 3.50 4.00
46-60 Days 4.50 4.00 4.50 5.00 5.50

~ 37 ~
 61-90 Days 5.00 4.00 5.50
91-180 Days 5.50 6.25 6.00
5.50 6.75
6 months - < 9 months 7.00 7.25 7.25
9 months - < 1 Year 7.25 8.00 6.50 7.50 7.50
1 Year - < 2 Year 8.00 1 8.25 7.00 8.00 9.00
2 Year - < 3 Year 8.00 8.25 2 7.50 8.00 9.25
3 Year - < 5 Year 8.00 8.25 8.00 8.00 8.50
above 5 Year 8.00 8.25 8.00 8.00 8.50
TABLE 2-
AXIS BANK OF BANK CENTRL
TIME SLAB PNB BANK BARODA OF INDIA BANK
7- 14 Days 3.75 0.00 3.50 3.25 3.75
15-29 Days 3.00 4.25
4.25 4.75 4.75
30-45 Days 4.00 4.50
46-60 Days 5.00
5.00 5.25 6.00 7.00
61-90 Days 5.00
91-180 Days 5.50 6.50 6.75 6.25 7.50
6 months - < 9 months 7.00 7.50 7.25 7.75
8.00
9 months - < 1 Year 8.00 8.15 7.50 7.75
1 Year - < 2 Year 8.00 8.00 8.50 8.00 8.80
2 Year - < 3 Year 8.00 8.00 8.755 8.25 8.50
3 Year - < 5 Year 8.00 8.00 8.50 8.25 8.50
above 5 Year 7.75 8.00 8.50 8.25 8.50

TABLE 3-

TIME SLAB HSBC CANARA BANK OBC SBI

7- 14 Days 0.00 3.254 3.50 3.25
15-29 Days 3.50 4.00 4.25 4.00
30-45 Days 4.00 4.75 4.00
46-60 Days 4.50
61-90 Days 5.25 5.50 6.00 5.50
91-180 Days 5.25 6.25 7.00 6.25
6 months - < 9 months 5.50 7.00 7.75 7.00
9 months - < 1 Year 8.00 5 7.25 8.00 7.25
1 Year - < 2 Year 7.50 8.25 8.25 8.25
2 Year - < 3 Year 7.50 8.25 8.50 8.25
3 Year - < 5 Year 7.50 8.25 8.50 8.25
above 5 Year 7.50 8.25 8.50 8.25
NOTES:
 1 = 8.10 % for 1 year 16 days
 2 = 9.00 % for 2 year 5.5 months
 3 = 8.50 for 1 year 1 month

~ 38 ~
  4 = Minimum amount is 5 Lakhs
 5 = 9.00 % for 750 days

TICK BOX COMPARISON ON THE BASIS OF FEATURES

Table 1-
CENTRAL UNION SBI HDFC AXIS
BANK OF BANK OF BANK BANK
INDIA INDIA
ODD-DEPOSIT AMOUNTS
ODD-DEPOSIT TENURE PERIODS 

QUATERLY INT PAYMENT    

NO-PENALTY ON PRE-MATURITY  

TAX BENEFIT SCHEMES     

NOMINATION FACILITY     

LOAN FACILITY    

OD FACILITY
TRANSFER OF ACCOUNTS   
WITHOUT CHARGES
Table 2-
ORIENTA ICICI SBBJ KOTAK HSBC
L BANK BANK BANK MAHINDRA BANK
ODD-DEPOSIT AMOUNTS
ODD-DEPOSIT TENURE 
PERIODS
QUATERLY INTEREST   
PAYMENT
NO-PENALTY PRE-MATURITY    

TAX BENEFIT SCHEMES   

NOMINATION FACILITY    

LOAN FACILITY   
~ 39 ~
 OD FACILITY 
TRANSFER OF ACCOUNTS
WITHOUT CHARGES
Table 3-
PNB BANK OF CANARA BANK
BARODA BANK OF INDIA
ODD-DEPOSIT AMOUNTS  

ODD-DEPOSIT TENURE PERIODS 

QUATERLY INTEREST PAYMENT    

NO-PENALTY PRE-MATURITY  

TAX BENEFIT SCHEMES   

NOMINATION FACILITY    

LOAN FACILITY    

OD FACILITY  

TRANSFER OF ACCOUNTS WITHOUT

CHARGES

PROFILE OF NON –BANKING COMPETITOR

Besides competition from Banking Sector, HDFC Ltd. has direct and tough competition from
its own field of non-banking institution. Under the study we have identify the 9 major
competitors and research will be carried over them. They are as follows:-
1. NABARD
2. Post Office Deposits schemes
3. ICICI Housing Finance Company
4. TATA Motors Limited
5. ShriRam Transport Finance Company
6. Life Insurance Corporation Housing Company
7. Mahindra & Mahindra Financial Services Ltd.

~ 40 ~
 8. CENTBANK Home Finance Ltd.
9. PNB Home Finance Ltd.
10. CAN-FIN Homes Ltd.

NATIONAL BANK FOR AGRICULTURE AND RURAL

DEVELOPMENT (NABARD)
BRIEF PROFILE:-
RBI in the year 1979 had set up a Committee to Review Arrangements for Institutional
Credit for Agriculture and Rural Development (CRAFICARD). On the recommendations of
the report submitted to Governor, RBI on November 28, 1979 by the committee; the
establishment of NABARD was proposed to the parliament and the Parliament through the
Act 61 of 81 approved it.
NARARD was then established with an initial capital of Rs 100 Crore, which was enhanced
to Rs 2,000 Crore, fully subscribed by the Government of India and the RBI.
At the time of its establishment, NABARD was proposed with the mission of –
“Promoting sustainable and equitable agriculture and rural development through effective
credit support, related services, institution building and other innovative initiatives.”
ABOUT THE BUSINESS OF FIXED DEPOSITS:
NABARD is not into direct business of Fixed Deposits but it has got a similar patterned form
of investment options for public i.e. It has come up with BHAVISHYA NIRMAN BONDS,
they are considered one of the important competitor as this scheme of NABARD is quite
popular with the target market of HDFC ltd. and the nature of this scheme is such that it
offers interest rates to public and is operating into the business through agents and so it
also has a commission plan (like HDFC Ltd. does for its agents).
SALIENT FEATURES OF NABARD RURAL BONDS:
 NATURE OF BONDS - BHAVISHYA NIRMAN BONDS are an instrument under Sec.
80 C of IT ACT, 2000. They are ZERO-COUPON BONDS that have an issue period
of financial year 2006-07 to 8008-2009. These bonds have a face value of Rs.
20000/- and have tenure period of 10 years.
 ISSUE PRICE- The issue price may vary from time to time, presently (w.e.f. 15 Jan
2009) the price per bond is Rs.8750/- for investment below Rs.1 Crore per investor
per day. For investments above Rs. 1 Crore issue price shall be decided by the
Head Quarter.
~ 41 ~
  RATE OF INTEREST- the rate of interest shall be calculated on Simple Interest
basis of order 12.85% p.a. or its compounded yield will be 8.62%
 TAXATION- Income/Gains arising out of Bonds are treated as Capital Gains so
procedures of capital gain tax shall be applicable. However, NO TDS shall be
deducted.
 LIQUIDITY- NABARD BONDS are listed on BSE and these bonds are transferable
or can be treated as security. Trading of bonds are possible in DEMAT form only.
For trading the ‘Market Lot’ is 5 bonds.
 NOMINATION- Nomination facility is also available for these bonds.
 WHO CAN APPLY- Individuals in their own names or in the name of their minor
children as natural/legal guardians. Hindu Undivided Families through the Karta of
the Hindu Undivided Family. (Applications by HUF would be given the same
treatment as that to applicants by individuals).
 GOVERNING LAW- The bonds are governed by and shall be construed in
accordance with the existing laws in India, NABARD Bonds Regulations, SEBI/RBI
directives or any other regulation. Any dispute arising thereof will be subject to
jurisdiction at Mumbai.
Additional Incentive Plans For Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.

GENERAL POST OFFICE (GPO)

BRIEF PROFILE: - The postal service comes under the Department of Posts which is a
part of the Ministry of Communications and Information Technology that comes under the
working arena of Government of India and the Postal Service Board is the apex body of this
department.
Besides providing a good medium of connectivity through various postal services, the
institution also helps to promote small and medium savings in both rural and urban portions
of the country through its various schemes that are symbolic of highest security and optimal
returns. One of the important reason why the GPO schemes are so popular among masses
as a source of investment is the fact that many of them offer tax exemption options and so
even today being a public sector unit it gives stiff competition of all big corporate private
players, which is indeed a remarkable achievement.

~ 42 ~
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The Fixed Deposit investments offered by the Indian Postal Department are a banking
service which is similar to a Bank Fixed Deposit. The term deposit of the company has
been categorized under the following heads:
 POST OFFICE TIME DEPOSIT (TD)
 NATIONAL SAVINGS CERTIFICATE (NSC)
 POST OFFICE RECURRING DEPOSIT (RD)
 POST OFFICE MONTHLY INCOME SCHEME (MIS)
 POST OFFICE SENIOR CITIZEN SAVINGS SCHEME
 KISAN VIKAS PATRA (KVP)
Information regarding the agents of general post office:
The institution deals into the business of fixed deposits both directly and through agents to
whom they provide commission rates for their contributions into the business.
COMMISSION RATES:
The Post office attracts representatives or agents by offering flat 1.00% brokerage for any
type of the deposits. Besides this, there is no incentive plans for the agents.
IDENTITY CARD:
The post office provides an identity card to each of its agents which is indicative of details
like- Name of agent, Code No. Branch allotted, attested photograph of the agent duly
stamped and signed by the officer in charged. This act as a proof of being a genuine agent
and helps to gain confidence in convincing customers and at the same time it also instills a
sense of belongingness and pride to be associated with the institution.
Renewal of Agency Of Post Office:
The agency given to the representatives or agents gets expired after every 3 years which
needs to be renewed.

LIFE INSURANCE CORPORATION LTD.

BRIEF PROFILE: - Life Insurance Corporation of India Limited had its eminent start in
the year 1956 and has completed over 53 years of successful existence. And over this
period it has gained such repute that the three letters ‘LIC’ now stands as a synonym for
insurance, safety and excellent services.

~ 43 ~
The company’s main area of operation is dealings in various types of insurances, and is a
reputed name of this industry.
The company enjoys “AAA” rating from CRISIL for its business of fixed deposits which
signifies ‘Security of Highest Order’ which represents its sound existence in this sector.
The company has a wide network across country which includes - 6 Regional offices, 13
Back offices, 127 Marketing Units, 2048 Branch offices and more than 1002149 Agents.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposit of the company has been categorized under two heads. They are
 NON-CUMULATIVE DEPOSITS
 CUMULATIVE DEPOSITS
COMMISSION RATES:
The agents are entitled to the commission for the amount mobilized by depositors at the
following rates:
PERIOD OF DEPOSIT COMMISION PAYABLE
1 Year 0.50%
2Years 1.00%
3 Years 1.50%
5 Years 2.00%
Additional Incentive Plans for Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.

CENT HOME FINANCE

BRIEF PROFILE: - Established in the year 1991, CENTBANK Home Finance Limited is
a subsidiary of Central Bank of India. Central Bank of India was the first Indian commercial
bank which was wholly owned and managed by Indians.
The housing subsidiary Cent Bank Home Finance Ltd. was started with its headquarters at
Bhopal in Madhya Pradesh. The main objective of the Company is promotion of Housing
Finance activities. The Company has well-established network all over India. The Company
is having 12 branches all over India.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The fixed deposit includes 3 schemes named below:
o SCHEME- 1 = FIXED DEPOSIT – QUARTERLY INCOME SCHEME
o SCHEME- 2 = FIXED DEPOSIT – MONTHLY INCOME SCHEME
o SCHEME- 3 = FIXED DEPOSIT – CUMULATIVE SCHEME
~ 44 ~
COMMISSION RATES:
At present time, the Company is accepting public deposits only directly. There is no
provision for appointment of agents/representatives for the purpose of collecting deposits.
Until few years back, the company had channels for accepting deposit through agents in
lieu of which agents get flat brokerage at rate of 0.50% of deposited amount.
Additional Incentive Plans for Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.

PUNJAB NATIONAL BANK HOUSING FINANCE COMPANY

BRIEF PROFILE: - Punjab National Bank (PNB) was established in the year, 1895 in
Lahore.PNB Housing Finance Ltd is a wholly owned subsidiary of the Punjab National
Bank. PNB Housing Finance, Ltd. was incorporated in 1988 and has its head quarter in
New Delhi, India. It has around 28 branches across country.
PNB Housing Finance Ltd has main business of offering loans for purchase / construction
of houses, apartments etc and also for repairs, renovations or up gradation of the
immovable residential properties. It also offers investment opportunities to general public
through fixed deposit schemes and various insurance packages. For its fixed deposit
schemes it offers cumulative and non-cumulative fixed deposit schemes. However, the
interest rates for both cumulative and non-cumulative half-yearly schemes are the same,
but as the cumulative scheme is compounded at half-yearly intervals, the annual yields for
them are much higher.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The business of Deposits under PNB Housing Finance Ltd has been categorized as –
 Fixed Deposit Scheme
 Cumulative Fixed Deposit Scheme
COMMISSION RATES:
PERIOD (months) % OF BROKERAGE
12 0.25
24 0.50
36 0.75
48 1.00
60 1.25
72 1.50
84 1.75

~ 45 ~
Additional Incentive Plans for Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.

ICICI HOME FINANCE COMPANY LIMITED

BRIEF PROFILE: - ICICI Home Finance Company Limited ("ICICI HFC") is one of the
leaders in the Indian mortgage finance and realty space. It is a 100 percent subsidiary of
the famous ICICI Group.
Besides housing loans, the company offers its customers fixed deposits with triple benefits
of safety, trust and returns. These deposits come with “AAA” and “MAAA” ratings from
leading credit agencies, CARE and ICRA, respectively. These are the high credit quality
ratings and hence offer high safety to its customers.
The vision of the company as a growing housing finance company is to make the dream of
owning a new home come true, for millions of Indians. For this, the company offers wide
range of innovative products - from different type of home loans to property related services
to help their customer’s dreams to come true.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
ICICI fixed deposit can be classified as
1. ICICI DEPOSITS
2. ICICI SPECIAL DEPOSITS
The above mentioned each fixed deposit include 2 schemes named below:
1. NON CUMULATIVE SCHEME
 ANNUAL OPTION
 MONTHLY OPTION
 QUARTERLY OPTION
2. CUMULATIVE SCHEME
COMMISSION RATES:
PERIOD OF DEPOSIT COMMISSION RATES
1 Year 0.75
2 Year 1.00
3 Years and above 1.25
Additional Incentive Plans for Agents:
The company frequently changes its incentive plans on an yearly basis but keeps alluring
packages that attract the attention of not only the agents but also of its competitors like –

~ 46 ~
international holiday package of 2 nights and 3 days for couple on the deposit amount of 5
Crore and above, Flat cash prize of 10000 on deposits of 15 Lakhs or more but with a time
limit of one month, daily household appliances etc.

CAN FIN HOMES LTD (CFHL)

BRIEF PROFILE: - The Company “CAN FIN HOMES Ltd.” has been set up under the
sponsorship of Canara Bank in the year 1987, which was also the "International Year for
Shelter for the Homeless".
CFHL was set up with the mission of promoting Home Ownership and increasing Housing
Stock all over the country. To achieve this prime objective, Can Fin employs the best of its
resources and has, till date, seen over 100,000 families secure homes.
CFHL is the first and the biggest bank sponsored Housing Finance Company (HFC) in the
country and one among the top players in the country's housing finance sector. The
company has a standing of over 17 years.
CFHL is one among the four HFCs selected by NHB in its first phase of securitization
programme. The company also enjoys 5 Star rating from NHB for the purpose of refinance.
CFHL's Deposit programme enjoys "MAA+" rating, which is the highest possible under High
Safety rating. And the company has wide network of 46 branches across the country.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
CanFin Homes Ltd. has broadly divided its deposits schemes into 2 parts:
 FOR INDIVIDUALS
o FIXED DEPOSIT SCHEME
o CUMULATIVE DEPOSITS SCHEME
 FOR TRUSTS
o CAN FIN TRUST FIXED DEPOSIT SCHEME
o CAN FIN TRUST CUMULATIVE DEPOSIT SCHEME

COMMISSION RATES:
FOR INDIVIDUAL DEPOSITS
PERIOD OF DEPOSIT COMMISSION RATES
12 0.50
24 0.75
36 - 84 1.00
For Trust Deposits

~ 47 ~
The company does not pay any commission for trust deposits to their agents mainly
because they try to approach their clients themselves.
Additional Incentive Plans for Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.

MAHINDRA & MAHINDRA FINANCIAL SERVICES LTD.

BRIEF PROFILE: - A subsidiary of Mahindra & Mahindra Limited (a leading tractor and
UV manufacturer with over 60 years’ experience in the Indian market), MAHINDRA &
MAHINDRA FINANCIAL SERVICES LTD. is one of the India’s leading non-banking finance
companies. Focused on the rural and semi-urban sector, the company provides finance for
utility vehicles, tractors and cars and has the largest network of branches covering these
areas.
The company has a goal to become the most preferred provider of retail financing services
in the rural and semi-urban areas of the country. And seek to position itself between the
organized banking sector and local money lenders, offering the customers competitive,
flexible and speedy lending services.
The company principally finance UVs used both for commercial and personal purposes,
tractors and cars. While it predominantly finances Mahindra & Mahindra UVs and tractors, it
has continued to expand its lending to vehicles not manufactured by Mahindra & Mahindra
Limited.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
Business of Deposits under Mahindra & Mahindra Finance Ltd. has been categorized as –
 Cumulative Deposit Scheme
 Non - Cumulative Deposit Scheme
COMMISSION RATES:
For Deposits of Cumulative Scheme
PERIODS (Months) COMMISSION RATE (%)
12 0.50
18 0.50
24 0.75
36 1.00
For Deposits of Non-Cumulative Scheme
PERIODS (Months) COMMISSION RATE (%)
12 0.50
~ 48 ~
 24 0.75
36 1.00
Additional Incentive Plans for Agents:
 For agents who have got a single deposit business worth 1 Crore: the company
gives an additional incentive of 0.25 %, above the normal rate available.
 For agents who have got a single deposit business worth 5 Crore: the company
gives an additional incentive of 0.50 %, above the normal rate available.
 Besides the owners of the franchise also provide special gifts to those agents who
bring in huge deposits at their personal level (not provided by the company).

TATA MOTORS LIMITED

BRIEF PROFILE: - Established in 1945, TATA MOTORS LTD. is a part of the famous
TATA GROUP and one of the world's largest manufacturers of commercial vehicles. It is
the leader in commercial vehicles in each segment, and among the top three in passenger
vehicles with winning products in the compact, midsize car and utility vehicle segments.
The company is the world’s fourth largest truck manufacturer, and the world’s second
largest bus manufacturer.
The company was formulated on the vision “to be the best in the manner in which it
operates; best in the products it delivers and best in the value system and ethics.”
The main business dealings of the company are - to manufacture, design and market
passenger and commercial vehicles in India.
All this replicates its strong financial presence in the industry, also not to forget its recent
hit of “NANO CAR” which has crashed the market before it was launched.
ABOUT THE BUSINESS OF FIXED DEPOSITS:
The term deposit of the company has been categorized under two heads. They are
 QUARTERLY INCOME PLAN
 CUMULATIVE DEPOSIT PLAN
COMMISSION RATES:
DEPOSIT PERIOD COMMISSION RATE (%)
1 Year 0.30
2 Year 0.75
3 Year 1.50
Additional Incentive Plans for Agents:
There are NO ADDITIONAL incentives provided by the company for its agents besides the
commission rates.
~ 49 ~
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED (STFC)
BRIEF PROFILE: - Shriram Transport Finance Company Limited (STFC) is the flagship
company of the Shriram Group which has significant presence in Chit Funds, Consumer
Durable Finance, Life Insurance, General Insurance, Stock Broking, Property Development,
Project Engineering and Wind Energy.
STFC is one of the country’s largest players in commercial vehicle finance. It was
established in the year 1979. The company has a wide network of 470 branches and
service centers spanning a geography which covers 91.3% of Truck Owners across
country.
From the orthodoxy of the 1970s through 1990s, to the pragmatism of the new millennium,
Shriram takes credit for having brought about a revolution in the institutional mindset.
Today, the Citigroup, UTI Bank, ICICI Bank and other leading banking institutions are proud
associates of Shriram in financing Pre-owned Trucks.
STFC was set up with the objective of offering the common man a host of products and
services that would be helpful to him on his path to prosperity. Over the decades, the
company has achieved significant success in reaching this objective, and has created a
tremendous sense of loyalty amongst its customers.
ABOUT THE BUSINESS OF DEPOSITS:
The term deposit of the company has been categorized under two heads. They are
 FIXED DEPOSITS
 CUMULATIVE DEPOSITS
COMMISSION RATES:
PERIOD OF DEPOSIT COMMISSION RATES
1 Year 1.00 %
2 Year 2.00 %
3 Years & above 3.00 %
NOTE: Commission rates are same for both the deposit schemes.
ADDITIONAL INCENTIVE PLANS FOR AGENTS:
The company keeps different attractive packages for the agents every year as it believes it
add variety and creativity that helps to motivate agents to contribute more deposits. The
packages include – Maruti 800 cars, Holiday Packages, Household Utility Accessories (Air
Conditioners, Television Sets etc.)

~ 50 ~
These packages not only boost the morale of present agents but also attract the attention of
other company’s agents who get lured to become a part of their organization.

TABULAR PRESENTATION OF RATE OF INTEREST OF VARIOUS NON-

BANKING SECTORS
ROI Cross Tabulation Comparison
ICICI HFC TATA MOTORS M&M LIC LTD. GPO
1 Years 9.00 10.10 10.50 8.00 6.25
2 Years 9.00 10.50 11.00 8.25 6.50
3 Years 9.10 11.00 11.50 8.50 7.25
5 Years & 9.10 - - 8.50 7.50
above

SRM NABARD PNB HFC CAN-FIN CENT HFC

HFC
1 Years 10.00 - 7.00 9.25 7.00
2 Years 10.50 - 7.25 9.50 7.50
3 Years 11.10 - 7.25 9.00 7.75
5 Years & 11.10 8.50 7.50 9.00 7.75
above

TABULAR PRESENTATION OF COMMISSION RATE OF DIFFERENT

NON-BANKING INSTITUTE
Commission Rates Of the Non-Banking Institution for the Agents:-
ICICI HFC TATA MOTORS M&M LIC LTD. GPO
1 Years 0.75 0.30 0.50 0.50 1.00
2 Years 1.00 0.75 0.75 1.00 1.00
3 Years 1.25 1.50 1.00 1.50 1.00
5 Years & above 1.25 1.50 1.00 2.00 1.00

STFC NABARD PNB HFC CAN-FIN HFC CENT HFC

1 Years 1.00 Rs 50 0.25 0.50 1.00

~ 51 ~
2 Years 2.00 Rs 50 0.50 0.75 1.00
3 Years 3.00 Rs 50 0.75 1.00 1.00
5 Years & above 3.00 Rs 50 1.00 – 1.00 1.00
1.75

TICK BOX COMPARISON OF NON-BANKING COMPETITORS

ICICI HFC TATA LIC M&M GPO
INTEREST ON MONTHLY/    
QUARTERLY BASIS
OFFER ROI > 9.50 %  
OFFER MINIMUM COMMISSION    
>= 0.50 %
ADDITIONAL ROI < 0.50 % FOR  
SENIOR CITIZENS
SEPARATE INCENTIVE PLANS  
FOR AGENTS
SECURITY (AAA RATINGS)    
TAX BENEFIT SCHEMES   
AVAILIBILITY OF LOAN     
FACILITY
NOMINATION FACILITY    
AVAILABILITY OF RECURRING 
DEPOSITS

TICK BOX COMPARISON OF NON-BANKING COMPETITORS (cont’d)

STFC CENT HFC NABARD PNB HFC CAN-FIN
INTEREST ON MONTHLY/    
QUARTERLY BASIS
OFFER    
ROI > 9.50 %
OFFER MINIMUM   
COMMISSION >= 0.50 %
ADDITIONAL ROI < 0.50 %     
FOR SENIOR CITIZENS
SEPARATE INCENTIVE 
PLANS FOR AGENTS
SECURITY (AAA RATINGS)   
TAX BENEFIT SCHEMES 
AVAILIBILITY OF LOAN    
FACILITY

~ 52 ~
NOMINATION FACILITY     
AVAILABILITY OF
RECURRING DEPOSITS

ANALYSIS & INTREPRETATION

5.1 ANALYSIS OF FEATURES THAT LACK IN HDFC BUT PRESENT IN
ITS BANKING COMPETITORS

~ 53 ~
 1. Banking Sector companies have a trend to offer Term or Fixed Deposits for variable
periods of time especially in days and various combinations in months which offer
great flexibility to its customers. Here, HDFC Ltd. has a loses this segment at all
since its product schemes have minimum lock-in tenure of 1 year.
2. Banking Sector companies also have an edge as they serve to small and medium
investors as they accept Fixed / Term deposits even for small amounts like – Rs 50,
100 and so on. However at HDFC Ltd. the minimum amount of deposits has to be Rs
10000/- in this way they discourage small investors and loose amount market share.
3. Some of the banks like ICICI, Yes Bank, Federal Bank, Central Bank of India etc.
offer a higher rate of interest than HDFC Ltd. so a rational consumer will have a
tendency to drift to them in order to maximize its returns.
4. Some of the banks have offered the flexibility to make a single account that have the
features of both Savings accounts and Fixed Deposit account wherein they can earn
the higher rate of interest on one hand and at the same time they possess the
flexibility to withdraw money any time and from anywhere.
5. Majority of the banks do not charge penal charges for pre-mature withdrawals.
However, with HDFC Ltd. as there is no provision to withdraw money upto 3 months
and subsequently there are no interest provided to customers if they withdraw the
amount in less than 6 months. Hence this is one of the biggest causes of distress for
the customers that for a long time of 6 months there is no incentive for their deposit
at HDFC Ltd.
6. Another major issue against HDFC Ltd. is that it calculates the interest amount on
yearly basis while majority of the banks compound it on a quarterly basis therefore
their annualized yield is higher even at the same level of rate of interest. So a
rational investor who is aware of this technicality will genuinely favour those banks
that offer interests that are compounded on a quarterly basis.

5.2 ANALYSIS FROM THE STUDY OF NON-BANKING COMPETITORS

The analysis is as follows:
1. COMPETITIVE ROI IN THE MARKET – Today’s world is a buyer’s market, when a
rational consumer finds competitive rate of interest (which is the return for its

~ 54 ~
 investment) he will tend to get attracted by it and might opt to drop HDFC Ltd. for its
list.
NBFC INTREST RATE OFFERED
ICICI HOME FINANCE 9.15
CAN-FIN HFC 9.50
TATA MOTORS 11.00
M&M 12.87
SRIRAM TFC 14.58

2. LACK OF EFFECTIVE TRAINING PROCEDURES FOR THE KEY PARTNERS –

The Company as of now does not cater to the issue of providing training to the new
recruits. Training is essential as it not only informs agents about the company details
but also make them aware of the nitty-gritty of the product features that helps them
to convince and tap potential customers.

3. LACK OF FLEXIBLE DEPOSIT TENNURES – Non-Banking Sector offers variability

in deposit tenures some offer high flexibility in deposit tenures as it even accepts
deposits of order 1 – 10 years.
HDFC Ltd. on the contrary offers deposits with minimum tenure of 1 Year to a
maximum of 5 years only.

4. POLICY OF PRE-MATURE WITHDRAWAL – According to the company’s policy,

there shall be a minimum lock-in period of 3 months – within which the customer
cannot withdraw his money at all. Moreover, from the period of 3 months upto 6
months there will be no payment of interest made to the customer at all and beyond
the tenure of 6 months till the date of maturity there are penal cuts on interest
applicable of order – 2 – 3 % depending upon the situation.

5. LACK OF ACCEPTANCE OF CASH DEPOSITS- HDFC Ltd. does not accept cash
for making term deposits. It can be possible through cheques or demand drafts.
Making a DD incurs a fee for the client and there problems associated with the
cheques is of handling from bank to home or office. Since such clients have other
options like – ICICI HFL, GPO etc. who readily accept the cash deposit. So they do

~ 55 ~
 not wish to make their term deposits with HDFC Ltd. which again makes the
company to lose clients.

6. LESS COMPETITIVE COMMISSION – An important issue that creates

dissatisfaction among KPs and is an important issue about lack of motivation for
them is the fact that the company`s commission rates are less competitive with
respect to their competitors.

7. MINIMUM MARKETING SUPPORT – Another important issue is the company

makes very little efforts to make its presence felt v.i.z. its competitors i.e. – HDFC
Ltd. as a brand is known for its Home Loans but there is very less awareness in the
market that the company is also into the business of Fixed Deposits.
Thus, lack of mass- awareness about the product and its feature creates another
issue that requires immediate attention.

5.3 STUDY OF ACTIVE KEY PARTNERS

~ 56 ~
The company HDFC Ltd. operates into its business of Fixed Deposits majorly through
informal channels i.e. through agents that they popularly term as Key Partners or KPs. These
Key Partners are broadly categorized as Active and Inactive Key Partners depending upon
their contribution made towards the business of the company.
Active Key Partners are those agents who are actively involved in promoting the business for
the company and are contributing huge revenues for the company. Active Key Partners were
studied majorly with two main objectives:
1. To identify the main problematic areas that these agents come across while working for
the company so that they can be improved upon.
2. To identify the main strength areas of the company so that they can be further built upon
and new agents can be recruited and can be motivated to work basing them.
For the study of Active Key Partners a random sample of 100 agents were studied. The
information was gathered through personal interaction and filling up of the questionnaire. At
times, even informal open-ended interviews also conducted wherever it was made possible.
The data so collected was then complied and the analyses basing them are as follows-

STRENGTHS OF THE COMPANY AS PRECIEVED BY THE KEY

PARTNERS:
1. EXCELLENT SERVICE PROVIDER – The Company enjoys the repute of being
“THE BEST OF THE BEST” in the market in reference to its services. Both agents
and the customers seem to be appreciative of the treatment given by them through
its employees. Agents feel that one of the biggest motivator for them to ring deposits
at their door is Hassel-Free Quick Services that are provided to them at HDFC Ltd.
2. RIGHT BLEND OF SAFETY, SECURITY AND RETURNS – Deposits is one of the
many sources of long term investment options available to any individual. Hence,
they expect not only good returns but also safety of the principle amount. HDFC ltd.
is a brand that enjoys “AAA” rating from two most reputed credit rating institutions –
CRISIL and ICRA since past 15 years.
Moreover, people recognize that the company deals in safe business as they are
aware of the fact that the main business of the company is to give home loans in lieu
of mortgage of property, who value (mortgaged property) will tend to appreciate over
time, they have minimal risk in their business dealings.
3. LOWEST NPA LEVELS – The biggest indicator of company’s high efficiency level
and safe dealings is through the fact that it has the lowest NPA levels in the entire
~ 57 ~
 world. NPA are the levels of bad debts incurred by the company in one financial
year. For HDFC ltd. this rate is 0.84 % whereas the ideal ratio for companies in this
business goes at around 1.50%. It is also a clear indication of the efficiency levels at
which the company operates and the lower the NPA level, lower are the business
risks associated.
4. TIMELY PAYMENTS – Another significant attraction of HDFC ltd. is the fact that it is
very prompt in clearing all its customer’s and agent’s payments. This has helped to
create a good image in the market that attracts significant attention.
5. ETHICAL CODE OF CONDUCT – Every company is recognized majorly by its code
of conduct. HDFC Ltd. is a brand image of being high on moral and ethical
principles. This feature attracts attention of not only agents but also of end
customers.
6. RECOGNIZE AGENT’S EFFORTS – Every year the company keeps a meeting cum
gathering especially for agents where it recognizes the efforts of its hard working
agents through award ceremony. This informal gathering cum prize distribution
ceremony creates emotional bonding between agents and the company employees
and also creates a sense of satisfaction and belongingness among agents who feel
motivated to be part of the organization.
7. CONTESTS SCHEMES – Another marketing strategy that is very popular among
agents are the contest schemes that are being organized by the company on
monthly basis. This scheme on one hand adds to additional income for the agents
but on the other hand motivates them to achieve their targets that are beneficial for
the company. Thus in this way it creates a WIN-WIN situation, which is appreciative
by all.

PROBLEMS THAT EFFECTS ACTIVE KEY PARTNERS

1. COMPETTIVE ROI - The biggest problem that any agent can face could be
regarding competitive interest rates available in the market, offered on only for the
customers.
2. FLEXIBLE DEPOSIT TENURES – HDFC ltd has very limited tenures that it offers its
customers with a minimum limit of 1 year which does not attract short term investors
who have varied options of depositing in days and flexible time periods offered by
the competitors. Hence due to lack of varied deposit tenures HDFC can lose short
term investors.
~ 58 ~
3. LACK OF ACCEPTANCE OF CASH DEPOSITS - HDFC Ltd. has a policy not to
accept cash deposits. Some of the partners feel this makes their job problematic as
lack of availability of DD or Cheques at the time of their customer’s deposits makes
unnecessary delay, excess cost & leads to wastage of time.
4. POLICY FOR PRE-MATURE WITHDRAWAL -Another cause of concern for the key
partners has been in regards to company’s policy for Pre-mature withdrawal. So it’s
difficult on agent’s part to convince the customers as other competitors do not offer
such rigid policies.
5. LESS COMPETITIVE COMMISSION RATES – Another important cause of concern
for the agents is the commission rates that are being provided by the company. After
the analysis, even the study reveals the fact the commission rates paid by the
company are below the market rate prevalent in today’s scenario. Some of the
agents have confessed this fact that mainly due to higher rates given by their
competitor they give huge business to them, even though they acknowledge the fact
that HDFC ltd. is much safer and more reputed brand to deal with!! Hence, this
clearly signifies the fact that the company does lose upon its business by giving less
commission to its agents.
6. LACK OF INCENTIVE PACKAGES FOR THE AGENTS – Some of the competitors
indeed give attractive packages for the agents if they achieve minimum target
amount like- Foreign tours, giving cars etc. that constantly motivates them to give
more business to them knowing the fact that HDFC ltd is a more repute and safe
brand. Thus lack of incentive packages for the agents can make the company to lose
business.
7. LACK OF ISSUE OF IDENTITY CARDS -Some of the agents feel that they should
be issued some Identity Cards by the company. Lack of this makes it difficult for
them at times to convince customers about being genuine, and to create an image
that No Fraudulent activity shall take place. Issuing of ID cards shall promote
goodwill of both agents and the company.
8. LACK OF PROPER CHANNEL TO TRAIN KEY PARTNERS – HDFC Ltd. have no
procedure so far to train its new recruited agents, this is one of the important flaws
faced by the company as such training not only enlightened these agents about the
company for which they are going to work in future but also makes them aware of
the Nitti-gritty of the product features which in turn helps them to convince the end-
customers and to target them effectively.
~ 59 ~
 9. MINIMUM MARKETING SUPPORT – A majority of the agents feel that they are not
been provided with adequate marketing support which could have helped to improve
the visibility of the company. Lack of it makes the company to lose its business to
competitors as agents feel that if the customers proposed the agent to make
deposits only through a particular company, they can’t do much to change their
outlook.
10. INCONVENIENT LOCATION -The location of the branch is indeed another cause of
concern for the key partners as the distance that they need to travel (to make
deposits on behalf of the customers) is immense. Moreover, due to lack of adequate
parking space at times create trouble as their vehicles are being towed by the
policemen who cause much of distress and wastage of time.

5.4 PERCEPTION MAPPING OF TOP 5 NON-BANKING COMPANIES AS

PERCIEVED BY KEY PARTNERS

~ 60 ~
 EXCELLE AVERAG SATISFACTO UNSATISFACTO
ATTRIBUTES GOOD
NT E RY RY
ATTITUDE OF THE
EMPLOYEES 1 2 5,4 3
RATE OF
INTEREST 4 2 1,5 3
COMMISSION
RATES 3 2,4,5 1
INCENTIVES 2 1 3,5,4
SECURITY (AAA
RATING) 1,3,5 2 4
MARKETING
SUPPORT 2,5 1,4 3
TIMELY PAYMENT
OF COMMISSION 1 2,3,4,5
TIMELY
INFORMING
ABOUT CHANGES 4,5 1,2 3
AWARDS AND
RECOGNITION 1 2 ,5 3,4

ANNUAL MEETING 1 2,4,5 3

TRAINING FOR
AGENTS 5 1,2,3,4
KEY TO THE CHART
NAME OF COMPANIES COMPARED:
 1 = HDFC Ltd.
 2 = ICICI HOME FINANCE
 3 = GENERAL POST OFFICE
 4 = TATA MOTORS Ltd.
 5 = LIC Ltd.
5.5 PIE-CHART REPRENTATIONS –
Following are the pie-chart presentations on 6 important criteria have to compare 5 different
companies dealing in similar businesses.

I. RATE OF INTEREST:

~ 61 ~
 Good
Average
Poor

II. COMMISSION RATES:

Good
Average
Poor

III. SECURITY (RATINGS):

~ 62 ~
 Good
Average
Poor

IV. MARKETING SUPPORT:

Good
Average
Poor

V. TIMELY PAYMENT OF COMMISSION:

~ 63 ~
 Good
Average
Poor

VI. ATTITUDE OF THE EMPLOYEES:

Good
Average
Poor

SWOT ANALYSIS
STRENGTH:
~ 64 ~
 1. Safest Company to deal with has been rated AAA by CRISIL and ICRA since past 14
years.
2. The company can also boost itself of possessing lowest NPA in financial sector in
ASIA.
3. The company (for its business of Fixed Deposits) offers wide range of products to
suit individual needs i.e. monthly , quarterly , half-yearly and cumulative.
4. It even has Easy Way Savings Scheme for small investors.
5. It provides the easy and comfort of Door-to-door services.
6. HDFC has got wide network, possesses 280 offices across the country and 14
branches in the state of Rajasthan itself.
7. FD avail Loan against FD up to 75% of the amount & absolutely Hassel free helps to
avoid Pre- mature withdrawals.
WEAKNESS:
1. Since the company is a non-banking organization it is bound to work under NBFC
guidelines.
2. Deductions in interest rates up to 3% makes the customer feel the pain in the neck at
the time of premature withdrawal.
3. Fixed Deposits by nature have a disadvantage that money gets blocked for a fixed
period of time. This limits the hands of the customer in times of urgency.
4. Also there is need that with rapid growth and development of all most all cities and
villages of the country.
5. Another important is that Fixed Deposits not available for short period of time.
OPPORTUNITY:
1. HDFC is one of the strongest players of the market and being safest. Its present
competitors do not have any edge and are losing out due to economic slowdown as
they lack security and safety which the customers desire the most specially during
times like this, so there are huge chances of the company to gain from FD business
provided the message of its power and stability.
2. Fixed Deposits are considered safest amongst all other options to invest during
times of depression mainly because customers are bothered by the swings of share
market.
3. More apparently BROKERS who earlier used to give stiff competition to FD market
can now be leered to join hands with HDFC as KPs. They have an edge to benefit as
even they are bothered to ensure safety for their customer’s investment.
~ 65 ~
 4. Huge untapped market potential also vests in form of small investments.
5. Potential markets can also be tapped from Villages and small districts.
6. The idea of MOBILE VANS is brilliant to increase both reach and visibility; it also at
the same time offers cost effective approach as the same van can be sent to
required area can construction cost of many branches can be reduced.
THEARTS:
1. A serious threat appears to arise from the fact that the company has a limited
visibility and reach ; this appears to be more haunting from the fact that even though
the competitors of HDFC are less competent and posses lesser safety and security
but still they are able to draw its customer due to lack of knowledge
2. Since there is global slowdown in the economy and the fact that it has to follow
NBFC guidelines so the company is left with limited flexibility to make interest rates
attractive to its customers, and so there are chances to lose huge customers to
competitors specially from banking sector which come under RBI guidelines and not
of NHBC.
3. Another obvious threat appears from the potential new entrants and present levels of
competitors.
4. Frequent changes in the government monetary policies and guidelines also affects
the company strategies which at times force the company to make such decision that
appear product quite unattractive in the eyes of the end-customers.

CONCLUSION

~ 66 ~
 The market of the fixed deposit is in the boom phase as the share market stumbles
due to the global crisis which also affects the realty sector and the insurance sector.
This report helps the company to capture business for the business when there is volatility
in the market. The business of Fixed Deposits also is much needed for the capital
requirements of the Loans business.
Now company has to decide their different way according to the perception of the
customers to grasp the more business. For getting more business company has to involve
more Active key partners which generate prominent business by their great network. To
grow this channel in market awareness about the product is much needed. As the company
is well known and image in the market then there is no major problem to doing so.
Now, the way of success for the company in the current situation will be is to make more
aware about the company products and making more & more involvement in it.
Now if the company has to capture the market they will have to look for the innovation in
their product as well as service mix.

RECOMMENDATIONS

~ 67 ~
Recommendations made over the analysis & interpretation of the main competitor i.e. Non-
Banking Financial Institutions are as follows:-
1. Regarding the ROI in the Market – The company works on the principle of
conservatism therefore by its policies it will not generally tend to hike its ROI by huge
volumes. But minor hikes of order – 0.25 to 0.75 will not only make it more appealing
to the end customers but will also not cause much to the company’s pocket.

2. Regarding the training of the Key Partners HDFC Ltd. can ideally keep small
training sessions on every Saturday. Saturday being half-day for rest of the
employees, one or two company representatives can spend additional 2-3 hours in the
office (for which they can be paid incentives) & train the recruits. OR If the number of
new hires is limited then, such training sessions can also be kept on a fort-nightly
basis.
Saturday being a week-end will also be ideal time as the KPs can also spare some
time for such training sessions unlike on working days.

3. Regarding Flexible tenure of Deposits - HDFC Ltd. is a non-banking institute and

hence it receives its guidelines from NHB. Under its guidelines, the non-banking
institute cannot offer term deposits of order less than 12 months. Therefore it cannot
do anything to cater to small term depositors.
However, it can surely tap very long term investors by not limiting the deposit tenures
to just 5 years but to extend them upto 7 – 10 years.

4. Regarding the premature Withdrawal - It’s under NHB guidelines that the company
offers a minimum lock-in period of 3 months and beyond that upto 6 months
To overcome this problem on premature withdrawal company may offer more
attractive Loans on the deposits.

5. Regarding the Lack of Acceptance of the Cash Deposit – to prevent the Black
money laundering this will be adapted as the not take cash & one more problem with
that it may be risky as to be taken with customers. Now it is responsibility of the HDFC
Ltd. to promote this thing as there feature in front of their customers & in the market.
A formal convey of information of this fact should be made to NHB so that it levers
regulation and no company can have that edge.

~ 68 ~
6. Regarding the Commission to Key Partners – Since the company works on the
principle of not to over exaggerate its expenses but aims to reduce it at minimum
levels It will not be feasible to propose a high hike in commission rates. But certain
hike of 0.25-0.50% appears not only feasible (considering the kind of returns in terms
of profits it can give) but will also make the product more appealing to the KPs.

7. Regarding the Marketing Aspect – One of the important sources to increase the
visibility factor is through making advertisements in media like – Television,
Newspaper ADs, Big Hoardings, and Banners etc.
But since all these sources require huge investment, more feasible solution could be
thinking of small-little ways that will not only create massive awareness but would be
cost effective. For e.g. – making tyres covers with reference of FDs that can be given
to KPs who can further distribute to their clients, making – pens, calendars, book-
marks with HDFC FDs logo and brief description of its product features that can again
be circulated for distribution.

~ 69 ~
 SUGESSTIONS
STUDY FOR INCREASING THE VISIBILITY
An important problem that the company’s business of Fixed Deposits faces is that the
general public does recognize the brand HDFC as a reputed company for home loans not
for the business of Fixed Deposits. Again many people do get confused HDFC Ltd’s Fixed
Deposit as the Fixed Deposit of HDFC Bank whereas realities both of them are competitors
for each other.
Hence a major objective in front of the company is to make the brand name popular for its
business of Fixed Deposits as well. Therefore the next important task in hand was
regarding to improve the visibility factor of the brand for its business of Fixed Deposits.
Under this part of study, various suggestions were to be identified that can possibly help to
popularize the company’s business of Fixed Deposit. The suggestions so made, are totally
based on my personal understanding about the nature of the business and the relevant
media that could be used for the same.
However, while making such suggestions the Ideas were bounded by the fact that the
company does not like to over-exaggerate its expenditure for advertisement and so
emphasis were made on initiating only cost-effective measures only.

SUGGESTIONS TO IMPROVE VISIBILITY

Some of the suggestions considering as the feasible to improve the company’s name &
fame of the company; are as follows:
I. Present the company conducts two contests on monthly basis to value the efforts of
‘that month’s top performers’ and gives away cash prizes ranging between Rs.500 to
Rs.2000, however such recognition are not widely noticeable. In-fact many of the
agents are not even aware of that some contests are even conducted by the
company. Therefore what ideally can be done is the names along with photograph of
such winners can be put upon the notice board of the company, so that when the
agents visit the company to get their customers fixed deposit register they can
actually see those winners. This will not only help to improve upon the visibility factor
for the company but will also act as a stron
g motivating factor for the agents to contribute more
business for the company in order to become the next winners.

~ 70 ~
II. In order to promote popularity of the company in the remote or Rural areas the
company can conducts camps in such areas where the company representatives
can convince and educate the masses about the benefits of term deposits in their
local dialects and at the same time shall skits and plays focusing on the importance
of small and timely savings in their lives can be conducted. And then basing which
the product can be promoted and the business can thus be extended in the interiors
of the state.

III. Now-a-days, FM Radios have also gained importance as a medium of

advertisements and is also quite cost effective with respect to the other mediums
like- televisions and newspapers ads. So what ideally can be done is in some
educative radio show, explaining the products features and their competitive edge
over other companies.
Another important source that is quite cost-effective and other good medium of
advertisement is MOBILE-SMS i.e. a bulk list of people can be sent sms featuring
the company’s product and the applicable rates.

IV. Since the company’s prospective target market can be salaried professionals
therefore institutions like-school, bank offices, privates institutes etc can be
contacted and offered bulk deposits schemes under which for all cumulative deposits
made by a group of 10-20 people, each one of them can be given 0.25% extra on
the prevalent deposits rates. Such schemes can be a good source of business
prospects for the company.

V. Another important cost effective suggestion can be that all the popular restaurants
can be contacted and small banners of HDFC Deposits can be posted at various
sections of the entire sitting arrangements so that they are well-noticed by the
customers.

~ 71 ~
 APPENDIX
KEY PARTNER’S QUESTIONNAIRE
OBJECTIVE: - The Objective of this Questionssnaire is to get your feedback regarding
HDFC Ltd. business dealing that would help us to improve our services to serve you better,
so please answer to the entire question honestly and your answer will be kept confidential.
PERSONAL DETAILS:-
Name:
Age:
Agency Code:
No. of years you have been part of HDFC Ltd:
FEEDBACK DETAILS:-
Q1. How do you grade the overall experiences to be part of HDFC (Fixed Deposits)?
a. Excellent b. Satisfactory
c. Good d. Not satisfactory
Q2.If you are not satisfied, what is the reason behind that?
a. Low Brokerage Rate b. No appreciation for KPs
c. Lack of Services d. Any other
Q3. What are the monthly targets that you generate for HDFC Deposits?
A. below 1 lakhs b. 1-2 lakhs
c. 2-5 lakhs d. above 5 lakhs
Q4. What are the biggest challenges for you to attract Potential customers?
a. Hesitation b. Unawareness about Deposits
c. Unstable Market d. Fear of changing policy
e. Any other ________________________________________________________
Q5. What do you feel should be incorporate more in the present services of the
company?
_________________________________________________________________________
_________________________________________________________________________
Q6. Reasons for which you are been the Key Partner from such a long period?
a. Higher Safety b. Transparency
c. Strong Financial Base d. Good Services

~ 72 ~
e. AAA rating from 15years f. Customer Satisfaction
g. Professionally Managed Company h. All of them
Q7. Do you feel the Commission or Brokerage rates of HDFC are competitive or at
par with present market rate?
a. Yes
b. No
Q8. If NO, then what rate you expect & why?
_________________________________________________________________________
_________________________________________________________________________
Q9. What do you feel can be the biggest hindrance in the prospective growth of the
company in the days to come that can affect the profit margins for the company?
_________________________________________________________________________
_________________________________________________________________________
Q10. Which feature you like the most as Key Partner?
a. Highest Safety d. Good Services
b. Wide Range of Products e. Advance Renewal Facility
c. High Liquidity f. Any other
Q11. Are you sensitive with the INCENTIVES that HDFC Ltd. provides to its Key
Partners?
a. YES
b. NO
Q12. What type of Deposits customer preferred?
a. Regular Deposits
b. Premium Deposits
Q15. Are you an agent of any other Non-Banking/Banking institution?
a. YES
b. NO
Q16. If YES, then please mark & name of them?
a. Post Offices b. Nationalized banks
c. Private banks d. Non-banking Institution
e. Any other
Q17. Do you think there is need of Special meetings/classes to motivate Key
Partners?

~ 73 ~
a. YES
b. NO
Q18. Any suggestion regarding enhance the more & more KPs, Customer, Clients?
_________________________________________________________________________
_________________________________________________________________________
Q19. Any unusual experience or remark that you would like to bring in notice of the
management?
_________________________________________________________________________
_________________________________________________________________________

INTRESEST RATES ON VARIOUS DEPOSIT SCHEMES -

HDFC REGULAR DEPOSITS
FOR INDIVIDUAL - (Fixed & Variable Rates) Interest rates effective from JUNE 18, 2009
REGULAR-ANNUAL INCOME PLAN
Period (Months) INDIVIDUAL SENIOR CITIZEN
24 – 35 7.65 7.90
36 – 59 7.90 8.15
60 – 84 8.25 8.50
Minimum Deposit Amount - Rs. 20,000
REGULAR - MONTHLY INCOME PLAN
Period (Months) INDIVIDUAL SENIR CITIZEN
12 – 23 7.10 7.35
24-35 7.35 7.60
36 – 59 7.60 7.85
60 – 84 7.95 8.20
Minimum Deposit Amount - Rs. 40,000

REGULAR NON-CUMULATIVE - QUARTERLY OPTION

Period (Months) INDIVIDUAL SENIOR CITIZEN
12-23 7.15 7.40
24-35 7.40 7.65
36-59 7.65 7.90
60-84 8.00 8.25
Minimum Deposit Amount - Rs. 20,000
REGULAR NON-CUMULATIVE - HALF YEARLY OPTION
Period (Months) INDIVIDUAL SENIOR CITIZEN
12-23 7.25 7.50
24-35 7.50 7.75
36-59 7.75 8.00
60-84 8.10 8.35

~ 74 ~
 Minimum Deposit Amount - Rs. 20,000
REGULAR - CUMULATIVE OPTION
INDIVIDUAL SENIOR CITIZEN
Period (Months) INDIVIDUAL SENIOR CITIZEN
(Maturity Amt of Rs 20,000) (Maturity Amt of Rs. 20,000)
12 7.40 7.65 21480.00 21530.00
24 7.65 7.90 23177.04 23284.82
36 7.90 8.15 25124.32 25299.36
48 7.90 8.15 27109.14 27361.26
60 8.25 8.50 29728.26 30073.14
72 8.25 8.50 32180.84 32629.36
84 8.25 8.50 34835.76 35402.84
Minimum Deposit Amount - Rs. 20,000 Interest Compounded annually
NOTE
Deposits are subject to tax deduction at source, wherever applicable.
Given Interest rates applicable for deposits below Rs 1 crore.
Other Terms and Conditions as per Deposit Applicable Form

HDFC PREMIUM DEPOSITS

FOR INDIVIDUAL - (Fixed & Variable Rates) Interest rates effective from JUNE 18, 2009
PREMIUM-ANNUAL INCOME PLAN
Period (Months) INDIVIDUAL SENIOR CITIZEN
30 8.00 8.25
45 8.00 8.25
Minimum Deposit Amount - Rs. 20,000
PREMIUM DEPOSIT- MONTHLY INCOME PLAN
Period (Months) INDIVIDUAL SENIOR CITIZEN
15 7.25 7.45
30 7.70 7.95
45 7.70 7.95
Minimum Deposit Amount - Rs. 40,000
PREMIUM NON-CUMULATIVE - QUARTERLY OPTION
Period (Months) INDIVIDUAL SENIOR CITIZEN
15 7.50 7.50
30 8.00 8.00
45 7.85 8.00
Minimum Deposit Amount - Rs. 20,000
PREMIUM NON-CUMULATIVE - HALF YEARLY OPTION
Rate of Interest Maximum Deposit
Period (Months)
(% p.a.)* without TDS (Rs.)**
15 7.60 65000
30 8.10 61000
45 7.95 62000
Minimum Deposit Amount - Rs. 20,000
PREMIUM - CUMULATIVE OPTION

~ 75 ~
 INDIVIDUAL SENIOR CITIZEN
Period (Months) INDIVIDUAL SENIOR CITIZEN
(Maturity Amt of Rs 20,000) (Maturity Amt of Rs. 20,000)
15 7.50 7.75 21903.12 21967.54
30 8.00 8.25 24261.12 24402.86
45 8.00 8.25 26705.90 26939.34
Minimum Deposit Amount - Rs. 20,000: Interest Compounded annually
NOTE
Deposits are subject to tax deduction at source, wherever applicable.
Given Interest rates applicable for deposits below Rs.1crore.
Other Terms and Conditions as per Deposit Applicable Form

HDFC DEPOSITS - FOR TRUSTS

Interest rates effective from JUNE 18, 2009
REGULAR DEPOSITS (Fixed & Variable Rates)
REGULAR DEPOSITS (Fixed & Variable Rates)
PERIOD Annual Cumulative Half- Yearly Quarterly Option Monthly
Plan Option Option
12-23 - 7.25% 7.15% 7.10%
24-35 7.65% 7.50% 7.40% 7.35%
36-59 7.90% 7.75% 7.65% 7.60%
60-84 8.25% 8.10% 8.00% 7.95%
Min.Amount (Rs) 20,000 20,000 20,000 40,000
For Cumulative Option Interests is Compounded Annually.
Deposits can be placed for any numbers of months between 12 & 60

PREMIUM DEPOSITS (Fixed & Variable Rates)

PREMIUM DEPOSITS (Fixed & Variable Rates)
PERIOD Annual Cumulative Half- Yearly Quarterly Option Monthly
Plan Option Option
15 7.50% 7.35% 7.25% 7.20%
30 8.00% 8.00% 7.65% 7.75% 7.50%
45 8.00% 8.00% 7.65% 7.75% 7.50%
Min.Amount (Rs) 10,000 20,000 20,000 20,000 40,000
For Cumulative Option Interests is Compounded Annually.
NOTE:-
Interest rates are subjected to change & the rates applicable will be the rate prevalent on the date of deposit.
Differential Interest Rates will be applicable for Rs. 1 crore & above as per the extant guidelines.

BROKERAGE & INCENTIVES RATES

Applicable on the deposits mobilised during the period 1 st April to September 30th 2009 are:
INDIVIDUAL DEPOSITS (Regular & Premium)
PERIOD Rate of *Target Amount of Incentives Maximum Rate of
Rs. 5 Lakhs Rs.10 Lakhs Rs.25 Lakhs
(MONTHS) Brokerage Commission
Rate of Incentives
(Brokerage +Incentives)
12-23 0.25% 0.15% 0.20% 0.30% 0.55%
24-35 0.50% 0.30% 0.35% 0.50% 1.00%
36-47 0.75% 0.40% 0.45% 0.75% 1.50%
48-59 1.00% 0.40% 0.45% 1.00% 2.00%
60-84 1.25% 0.40% 0.45% 0.75% 2.00%
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TRUST DEPOSITS (Regular & Premium)
PERIOD Rate of *Target Amount of Incentives Maximum Rate of
Rs. 5 Lakhs Rs.10 Lakhs Rs.25 Lakhs
(MONTHS) Brokerage Commission
Rate of Incentives
(Brokerage +Incentives)
12-23 0.25% 0.15% 0.20% 0.30% 0.55%
24-35 0.50% 0.30% 0.35% 0.50% 1.00%
36-47 0.75% 0.40% 0.45% 0.75% 1.50%
48-59 1.00% 0.40% 0.45% 1.00% 2.00%
60-84 1.25% 0.40% 0.45% 0.75% 2.00%
NOTE:-
Incentives will be paid to Key Partners only if they achieve the target amount during the period 1st April to September 30th
2009
EASY WAY SAVINGS
Brokerage will be paid @ 0.50 % p.a. proportionately for the actual period of each contribution made in the account.

BIBLIOGRAPHY
TEXT BOOKS:-
 Kothari C.R., “Research methodology”, New age international Pvt. Ltd. 2nd
Edition.
 Agrawal M.R., “Security Analysis & Investment Management” Garima
Publication,2008 1st Edition
 Bhalla V.K, Investment Management, New Delhi: S.Chand Publication, Inc.2007,
13th Edition.
 Ramaswamy V S, Namakumari S, “Marketing Management”, MACMILLAN
Business Books. 3rd edition.
 Kotler Philip, “Marketing management” Persons Education, 11th edition.
 Kotler Philip, Killer, Koshy, Jha, “Marketing Management” Persons Education,
12th edition.
 Kumar Arun and N Meenakshi, “Marketing Management” Vikas Publications,
2006 1st edition.
HDFC Journals
 “HDFC QUATERLY” – quarterly newsletter of Housing Development Finance
Corporation Limited.
 “IN TOUCH” – a newsletter for Fixed Deposit’s Key Partners.
WEBSITES LINKS
 http://www.articlesbase.com/banking-articles/fixed-deposit-the-best-and-secured-
way-to-save-money-692210.html
 http://www.ecompare.co.in/savings/savings_search_results.cfm?
variable=form&compare_flush_flag=1&searchtype=basic&type=fixeddeposits

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  http://www.maduraidirectory.com/bandf/interest.php [ Accessed on 02 June
2009 ]
 http://business.mapsofindia.com/investments/insurance/mutualfunds/indian
sharemarket/indian real state.html
 http://www.rupeetimes.com/article/fixed_deposits/fixed_deposits_in_india_benefit
s_drawbacks_and_precautions_1103.html
 http://www.articlesbase.com/personal-finance-articles/fixed-depositsthe-
favorable-deposits-again-762295.html
 http://www.articlesbase.com/finance-articles/fixed-deposits-infusing-faith-in-
people-650293.html
 http://www.caclubindia.com/articles/article_list_detail.asp?article_id=754
 http://cdrates.bankaholic.com/advantages-disadvantages-of-cd-accounts/
 http://www.indianground.com/nri/faqs-nri-banking.aspx
 http://iic.nic.in/iic5_a02.htm [ Accessed on 12 April 2009 ]
 http://www.ratekhoj.com/news/index.php/fixed-deposits/flexi-deposits-in-india-a-
hybrid-of-savings-accounts-and-fixed-deposits-141/
 http://www.rediff.com/money/2006/jan/18tax.htm
WEBSITES
 Company website – www.hdfc.com
 www.business.mapsofindia.com
 Websites of all the 15 banks and 10 non-banks studied under competitive analysis.

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