University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Biofoam: Not Just Peanuts
Summer Internship Program
State bank of India
[Type the author name]
SUMMER INTERNSHIP REPORT
Merchant Acquiring Business
Point of Sale (P.o.s.)
L.J. Institute of Management studies
In requirement of partial fulfillment of
Master’s of Business Administration (MBA)
2 year full time Program of Gujarat Technological University Submitted on:
27th July 2013
Batch No: 2012-14
1. Objective of the Study
2. Company Profile
OVERVIEW OF SBI
BOARD OF DIRECTORS
ACHIEVEMENTS AND AWARDS
SOCIAL ACTIVITIES OF SBI
3. Organization Overview
a. Organisation Structure
b. Employee Profile
c. Departmentation Information
i. Finance ii. System iii. Marketing iv. HR
4. Strategies Adopted
b. Operations/ Production
a. Problems Identified
c. Research Methodology
d. Data Analysis
e. Conclusions / Observations / Findings
f. Suggestions / Comments
OBJECTIVE OF THE STUDY
The objective of the study is
TOWARDS THE PARTIAL FULFILLMENT
FOR THE AWARD OF THE DEGREE IN
MASTER OF BUSINESS ADMINISTRATION (2ND YEAR, SEM-3)
The major objective of the study is :
( study of the various departments of the organization )
ARE THE CUSTOMERS OF HOME LOAN DEPARTMENT SATISFIED WITH THE PROCESSES INVOLVED IN GETTING LOAN FROM SBI ?
HISTORY OF SBI
EVOLUTION OF SBI
The origin of the State Bank of India goes back to the first decade of the nineteenth century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809), the first joint-stock bank of British India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern banking in India. On 27 January 1921,they were amalgamated as the Imperial Bank of India. The three presidency banks came into existence either as a result of the compulsions of imperial finance or by the felt needs of local European commerce and were not imposed from outside in an arbitrary manner to modernise India’s economy. Their evolution was, however, shaped by ideas culled from similar developments in Europe and England, and was influenced by changes occurring in the structure of both the local trading environment and those in the relations of the Indian economy to the economy of Europe and the global economic framework.
The establishment of the Bank of Bengal marked the advent of limited
liability, joint-stock banking in India. It was the associated innovation in banking, viz. the decision to allow the Bank of Bengal to issue notes, which would be accepted for payment of public revenues within a restricted geographical area. This right of note issue was very valuable not only for the Bank of Bengal but also for the Banks of Bombay and Madras. The concept of deposit banking was also an innovation because the practice of accepting money for safekeeping (and in some cases, even investment on behalf of the clients) by the indigenous bankers had not spread as a general habit in most parts of India. But, for a long time, and especially upto the time that the three presidency banks had a right of note issue, bank notes and government balances made up the bulk of the investible resources of the banks. The three banks were governed by royal charters, which were revised from time to time. Each charter provided for a share capital, four-fifth of which were privately subscribed and the rest owned by the provincial government.
Presidency Banks Act
The presidency Banks Act came into operation on 1 May 1876.
This brought the three presidency banks under a common statute with similar restrictions on business. The proprietary connection of the Government was, however, terminated, though the banks continued to hold charge of the public debt offices in the three presidency towns, and the custody of a part of the government balances.
Bank of Madras
The decision of the Government to keep the surplus balances in Reserve Treasuries outside the normal control of the presidency banks and the connected decision not to guarantee minimum government balances at new places where branches were to be opened effectively checked the growth of new branches after 1876. The pace of expansion witnessed in the previous decade fell sharply although, in the case of the Bank of Madras, it continued on a modest scale as the profits of that bank were mainly derived from trade dispersed among a number of port towns and inland Centers of the presidency.
Bank of Bombay
Presidency Banks of Bengal
The presidency Banks of Bengal, Bombay and Madras with their 70 branches were merged in 1921 to form the Imperial Bank of India.
The triad had been transformed into a monolith and a giant among Indian commercial banks had emerged. The new bank took on the triple role of a commercial bank, a banker’s bank and a banker to the government.
But this creation was preceded by years of deliberations on the need for a ‘State Bank of India’. What eventually emerged was a ‘half-way house’ combining the functions of a commercial bank and a quasi-central bank.
The establishment of the Reserve Bank of India as the central bank of the country in 1935 ended the quasi-central banking role of the Imperial Bank.
The latter ceased to be bankers to the Government of India and instead became agent of the Reserve Bank for the transaction of government business at centres at which the central bank was not established.
But it continued to maintain currency chests and small coin depots and operate the remittance facilities scheme for other banks and the public on terms stipulated by the Reserve Bank.
It also acted as a bankers’ bank by holding their surplus cash and granting them advances against authorised securities. The management of the bank clearing houses also continued with it at many places where the Reserve Bank did not have offices. The bank was also the biggest tenderer at the Treasury bill auctions conducted by the Reserve Bank on behalf of the Government.
The establishment of the Reserve Bank simultaneously saw important amendments being made to the constitution of the Imperial Bank converting it into a purely commercial bank. The earlier restrictions on its business were removed and the bank was permitted to undertake foreign exchange business and executor and trustee business for the first time.
The Imperial Bank during the three and a half decades of its existence recorded an impressive growth in terms of offices, reserves, deposits, investments and advances, the increases in some cases amounting to more than six-fold. The financial status and security inherited from its forerunners no doubt provided a firm and durable platform. The lofty traditions of banking which the Imperial Bank consistently maintained and the high standard of integrity it observed in its operations inspired confidence in its depositors that no other bank in India could perhaps then equal. All these enabled the Imperial Bank to acquire a pre-eminent position in the Indian banking industry and also secure a vital place in the country’s economic life.
Stamp of Imperial Bank of India
When India attained freedom, the Imperial Bank had a capital base (including reserves) of Rs.11.85 crores, deposits and advances of Rs.275.14 crores and Rs.72.94 crores respectively and a network of 172 branches and more than 200 sub offices extending all over the country.
S B I – THE PROFILE
REGISTERED NAME: STATE BANK OF INDIA
CHAIRMAN: SHRI ARUN KUMAR PURWAR
DATE OF ESTBLISHMENT: 1ST JULY 1955
FORM OF ORGANISATION: NATIONALISED BANK
CENTRAL OFFICE: CORPORATE CENTRE
REGISTERD OFFICE: CENTRAL ACCOUNTS OFFICE
Number of domestic branches: 9,177
Number of foreign brances: 70
SYMBOL OF SBI
The new symbol of the State Bank of India is circular representing the simplest and the most symmetrical of gometrical shapes.
The circular shape of the symbol suggests the continual expansion like the ring in the water, to cover the entire country.
From the ancient times, the roundness was considered as the fullness of the man’s being and his growing consciousness.
The small circle in the center connotes that despite the SBI’s size it is small man who hold the center of State Bank stage.
OVERVIEW OF THE BANK
* State Bank of India is the nation’s largest bank, accounting for about 20% of India’s deposit and loan activities. * The bank operates more than 13,500 branches and over 5,000 ATMs within India and more than 50 offices in some 30 other countries. * The bank owns an asset base of $126 billion.
* While its size has slowed modernization of both its services and its products, the bank has become more computerized. * Its international banking services include shipping and export financing and merchant banking. * The Reserve Bank of India owns about 60% of State Bank of India.
MISSION OF SBI
* To retain the bank’s position as the premier Indian financial service group, with the world class standards and significant global business, committed.
* To excellence in customer, shareholder and employee satisfaction, and to play a leading role in the expanding and diversifying financial services sector, while continuing emphasis on its development banking role.
VISION OF SBI
* Premier Indian financial services group with global perspective, world- class standards of efficiency and professionalism and core institutional values.
* Retain its position in the country as a pioneer in development banking.
* Maximize shareholder value through high sustained earning per share.
* An institution with a culture of mutual care and commitment, a satisfying and exciting work environment and continuous learning opportunities.
BOARD OF DIRECTORS
Directors on the Bank’s Central Board as on 1st July 2006
Prof. M.S. Swaminathan
Shri. Ajay G. Piramal
Shri. Suman Kumar Bery
Dr. Ashok Junjhunwala
Shri. A. C. Kalita
Shri. Amar Pal
Shri. Arun Singh
Shri. Rajiv Pandey
Shri. Piyush Goyal
Shri. Ashok K Jha
Smt. Shyamala Gopinath
Shri. O. P. Bhatt
Shri T. S. Bhattacharya
SERVICIES OF SBI
1. SBI VISHWA YATRA FOREIGN TRAVEL CARD
2. FOREIGN INWARD REMITTANCE
3. ATM SERVICES
4. INTERNET BANKING
6. GIFT CHEQUES
7. PUBLIC PROVIDENT FUND (PPF)
2. DEPOSIT SCHEMES
1. CURRENT ACCOUNT
2. BASIC BANKING
3. SAVINGS BANK ACCOUNT
4. TERM DEPOSITS
3. PERSONAL FINANCE
1. SBI SARAL PERSONAL LOAN
2. HOUSING LOAN
3. SHORT TERM HOUSING LOAN
4. EASY TRAVEL LOAN
5. GRAM NIVAS SCHEME
6. CAR LOAN
7. EDUCATION LOAN
8. SCHOLAR LOANS
9. PROPERTY LOAN
10. LOAN TO PENSIONERS
11. LOAN AGAINST SHARES \ DEBENTURES
12. LOAN FOR EARNEST MONEY DEPOSIT
13. FESTIVAL LOANS
14. MEDI-PLUS SCHEME
15. TEACHERS-PLUS SCHEME
16. SAINIK-PLUS SCHEME
17. TRIBAL-PLUS SCHEME
18. CREDIT KHAZANA
19. RENT PLUS
* State Bank of India is focusing on internal accruals through competitive and efficient operations to increase profitability in the coming years. * SBI has moved up in terms of processes and technology in working systems. There has been concerted efforts to push up commercial lending, especially credit to SMEs (small and medium enterprises), besides cashing in on real estate boom with focus on improving housing loans. * SBI was focused on deploying capital to improve agriculture sector ‘in a viable way and not as a one-time basis’. * Retail credit alone stood at Rs 50,000 crore for the year ended 31 March 2006. * SBI has teamed up with GE Capital Services to market its credit cards, being showcased as an important product in personal banking. * At present, the bank has over 2.5 million credit cards in circulation * At present, the bank has around 6,000 ATMs across the country with an average disbursement of Rs 10 crore per day.
* SBI Life, a joint venture with French company, Cardiff, adopts banc assurance model to expand its business in life insurance. * Through bundling SBI Life with other products, the bank offered protection to customers. Similarly, SBI Mutual Fund through multiple schemes had received overwhelming response from investors. * To facilitate transactions of salary in labour intensive companies and factories, the bank has introduced Payroll cards, an ATM card for employees to draw salary from banks after the same has been remitted by the employers. They don’t need to have SB accounts for availing Payroll cards. * The bank has targeted 16 per cent growth in deposits and 20 per cent growth in lending for the region in the current fiscal. * Recently, the newly opened branches have received good response from customers as efforts were taken to improve the ambience of banking experience.
(ARUN KUMAR PURVAR)
(SHRI C. BHATTACHARYA)
(SHRI K. ASHOK KINI)
CHIEF GENERAL MANAGER
DEPUTY GENERAL MANAGER
ASSISTANT GENERAL MANAGER
(MR S. MANKODI, REGIONAL BUSINESS OFFICE, SAURASTRA)↓
(MR. V. SUBRAMAIAN, MAIN BRANCH, RAJKOT)
(MR. JAGDISH JOSHI, PFC, RAJKOT)
1. MARKETING DEPARTMENT
2. FINANCE DEPARTMENT
3. SYSTEM DEPARTMENT
4. HUMAN RESOURCE DEPARTMENT
1. MARKETING – AN INTRODUCTION
2. BANKING SECTOR AND THE ROLE OF MARKETING
3. MARKETING IN SBI
4. 7 PILLARS OF MARKETING
5. CUSTOMER SERVICE AT SBI
MARKETING – AN INRTODUCTION
Marketing is a multi-faceted subject covering the areas of production, consumption and distribution which can be viewed narrowly as activities that occur in the transfer of services to customers or broadly as all processes by which the society meets its requirements.
Marketing seeks to convert customer deeds into products and offers it to the market so as to fulfill the needs of the customers.
Marketing communication is considered as a tool to communicate the benefits of the product to the customer.
Marketing management is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals.
Marketing department is one of the most important departments of any business organization. Whether its business unit, service unit, manufacturing unit, non government unit, tourism, country etc., competition has left no sector but to push itself to survive. The world has become global village and constant research and development, technology up gradation has made the market full of services and products and new ideas for customers.
Scope of marketing is ever changing and everlasting. Brand management, event marketing, e-marketing, relationship marketing etc. are the new jargons in this area. MARKETING IN BANKING SECTOR
“THE ROLE OF MARKETING IS TO DELIVER A HIGHER STANDARD OF LIVING”
Marketing in banking sector is expressed as,
“Putting People First”
Banking – a word that brings the picture of money, economy cheques, drafts, savings, deposits, investments, and today.. it may bring more pictures of debit card, credit card, ATMs., Mutual funds, loans for 2 wheelers, 4 wheelers, homes, education, traveling, etc. The scope of banking activities has increased and therefore the role of Marketing in banking sector also has undergone rapid changes. Core banking, Net banking, e-banking, mobile banking, phone banking, are the new awtaars of banking today.
BANKING ENVIRONMENT IN INDIA
The mantra of today’s marketers
“Catch the customer and cash the customer”
“Love the customer and not the product”
The growth in aggregate deposits of scheduled commercial banks at 17.3% in 2003-2004 was higher than 13.4% in 2002-2003, adjusted for mergers. However, scheduled commercial banks’ credit recorded a lower rise of 14.6% during 2003- in food credit following higher off take of food grains. MARKETING IN SBI
Marketing activities in SBI are centralized. Basically there are 14 circles all over the country zone wise. Namely,
1. Ahmedabad Circle 8. Hyderabad Circle
2. Banglore Circle 9. Kolkata Circle
3. Bhopal Circle10. Lucknow Circle
4. Bhubaneshwar Circle11. Mumbai Circle
5. Chandigarh Circle12. Delhi Circle
6. Chennai Circle13. Patna Circle
7. Guvahati Circle14. Kerala Circle
Under each circle there is one local head office and few Zonal offices which take care of marketing activities of respective local branches of SBI. At L.H.O., there is one marketing head and good staff who plans & executes all the activities of marketing of SBI & its products for that particular region. The Central office at Mumbai decides the budget of marketing for all different circles and according to the allotted budget and requirements, heads at circle designs and develops the needed marketing strategies. So here, at SBI main branch, Rajkot, AGM of Main Branch, PFC & Regional head, carry out marketing functions under the supervision of L.H.O. Ahmedabad.
DESIGNING AND REDESIGNING PRODUCTS & SERVICIES
PRICING (setting interest rates)
AFTER SALES SERVICES etc.
MARKETING MIX OF SBI
The second important pillar of marketing or marketing mix of SBI is “PRICE”.
It is important because other P’s are expense making whereas only this P fetches money.
Banking sector is a service sector therefore in this sector there is no physical existence of product but here services are delivered and priced.
It can be the interest on loan or charges collected for providing different facilities to its customers.
Interest rate is the word used instead of price in banking sector. As far as deposits are concerned the public funds are used by bank and interest is paid to the account holders. As far as loans are concerned the interest is paid by the customer to the bank for using the funds of the bank.
Interest rates are decided by the corporate office, MUMBAI under the supervision of RBI.
In fact, decision regarding interest rates is all affected by monetary policies, capital market, availability of funds to commercial banks and economic conditions of country.
Distribution or execution of products and services at any bank is mostly through its outlets or branches themselves. Yes today, ATMs are the most dynamic retail channel in terms of transformation they are bringing about in banking habits and about popularity with customers and branch staff alike.
Depending on the size o market, city, town, state, country and need, the number and place of Zonal offices and branches are determined. As far as SBI is concerned, most of the branches and offices are located at the heart of the city.
SBI has huge network of outlets and ATMs through out the world form where it serves its customers.
PLANING & EXECUTION PREMISES
CORPORATE CENTER (MUMBAI)
REGIONAL BUSINESS OFFICE
Depending on the size of market, city, town, state and country need, the number and place of Zonal offices and branches are determined. As far as SBI is concerned most of the branches and offices are located at the heart of the city.
IN RAJKOT THERE ARE 5 BRANCHES OF SBI:
1. RAJKOT MAIN BRANCH
2. BHAKTINAGAR BRANCH
3. JAGNATH BRANCH
4. LAKHAJIRAJ ROAD BRANCH
5. MARKETING YARD BRANCH
GENERAL PROMOTIONAL ACTIVITIES AT SBI:
At every branch of SBI they put hoardings of their different products, not only in branches but also on crowded roads of the city.
They give advertisement in TELEVISION and NEWSPAPERS for their different products and special schemes if any. SBI organized WORKSHOPS on securities market awareness campaign (SMAC) at eight centers and educated about 1675 investors in these workshops.
They even give advertisement in national level MAGAZINES.
PRODUCTWISE PROMOTIONAL ACTIVITIES
1. EDUCATION LOAN :
For advertising at national level SBI put HOARDING and took help of TELEVISION. At local level they give LEAFLET to all the customers that visit the personal finance cell. Recently they have also started giving SEMINARS and PRESENTATIONS in colleges and coaching classes, where potential customers are found.
2. HOUSING LOAN :
To increase the sales and for creating awareness about housing loan, SBI conducted a property fair. For that they took help of print media by giving advertisement in local newspapers and by distributing leaflets.
3. AUTO LOAN :
As far as marketing of Auto Loan is concerned bank was in general impression that there was no need of doing. But as the time passed SBI started realizing that there rate are little bit higher in market. They decreased their rate & started doing marketing by giving advertising in the in local newspaper. They are doing promotion jointly with the dealers and also keeping stall at fair or other places.
FOR THE YEAR| 2005- 06| 2004-05| % change|
Total Income (Rs. Crore)| 43,184| 39,548| 9.19|
Total Expenditure (Rs. Crore)| 38,777| 35,243| 10.03| Net Profit (Rs. Crore)| 4,407| 4,305| 2.37|
Earning Per Share (Rs.)| 83.73| 81.79| 2.37|
Return on Average Assets (%)| 0.89| 0.99| (-) 10.10| Return on Equity (%)| 15.47| 18.10| (-) 14.53|
Profit Per Employee (Rs. Thousands)| 216.76| 207.50| 4.46|
AT THE END OF| March 2006| March 2005| (%) change|
Paid up Capital andReserves & Surplus| 27,644| 24,072| 14.84| Deposites (Rs. Crore)| 3,80,046| 3,67,048| 3.54|
Advances (Rs. Crore)| 2,61,642| 2,02,374| 29.29|
OF THE STATE BANK OF INDIA
AS ON 31ST MARCH 2006
(Rs. in billion)| MARCH 2005| MARCH 2006|
CAPITAL & LIABILITIES| | |
Capital| 5.26| 5.26|
Reserves & Surplus| 320.26| 366.80|
Minority Interest| 13.04| 14.30|
Deposits| 5061.05| 5440.24|
Borrowings| 229.30| 369.75|
Other Liabilities & Provisions| 656.87| 771.96|
Total| 6285.78| 6968.32|
ASSETS| | |
Cash & balances with
Reserve Bank of India | 256.16| 311.29|
Balances with banks and
money at call & short notice | 253.41| 262.08|
Investments| 2619.62| 2279.31|
Advances| 2869.87| 3743.17|
Fixed Assets| 35.74| 39.58|
Other Assets| 250.98| 332.92|
Total| 6285.78| 6968.32|
Contingent Liabilities| 2017.46| 2930.77|
Bills for Collection | 316.90| 247.81|
STATE BANK OF INDIA MARKET RELATED RATIOS
MARKET RELATED RATIOS| MAR 03| MAR 04| MAR 05| MAR 06| Market Price (Rs)
(as on last day of the year/quarter)| 270 | 606| 657 | 968 | Price to Book Ratio (%)| 0.83| 1.58| 1.44| 1.79| Market Capitalization
(Rs in Billion)| 142.05| 318.78| 345.75| 509.48| Earning Per Share
( Rs)| 59.00| 69.94| 81.79| 83.73|
P/E Ratio (%) | 4.58| 8.66| 8.03| 10.40|
Analysis of Performance financial
* Level of domestic investments remained stable during the half-year of FY 2005-2006. * Investment Fluctuation Reserve amounted to 5.30% of eligible Investments. * During the half-year the Bank divested its stake in (Credit Information Bureau of India Ltd. (CIBIL) from 40% to 10% and booked a profit of Rs.7.50 crores as a result of this disinvestment. * During the period, forex business on account of customers registered a growth of 28.80% on Year-on-Year basis. * NII of the Bank went up by 24.11% from Rs.6,333.89 crore in H1 of 2004-05 to Rs.7,861.19 crore in H1 of 2005-06. * Staff costs registered a growth of 9.11% due to wage revision. Other Operating Expenses of the Bank showed a growth of 10.41% in in H1 of 2005-06 as compared to H1 of 2004-05 * Total provisions made for this half year were higher at Rs.2,984.21 crore as compared to Rs.2,536.02 crore made in H1 of 2004-05. Major provisions are as under: * Provision for NPAs at Rs.246.74 crore for the current half year (as against Rs.508.45 crore during H1 of 2004-05). * Higher Provision for depreciation on investment Rs.2,397.07 crore (as against Rs.344.03 crore in H1 of 2004-05). * Provision for tax at Rs.400.09 crore (including deferred tax debit) as compared to Rs.1,449.97 crore in H1 of 2004-05. Provision for tax is lower mainly due to higher provision for depreciation on Investment. * The provision & contingencies for the Current Quarter (Q2 only) stood at Rs.767.56 crores, as against Rs.1,523.04 crores in the corresponding period of the previous year.
* The Bank’s ATM network includes 5479 ATMs in India, which is the largest ATM network in the country. The Bank continues to expand this network rapidly. Customers can transact free of cost at the ATMs of the State Bank Group.
* The agreement with VISA and Master Card International for acquiring ATM transactions has resulted in another revenue generation stream.
Core Banking Solution (CBS)
* The Bank is moving towards a centralized database and a Core Banking Solution, with capability for on-line, real-time transaction processing. The Bank has brought 2165 branches at 437 centers under Core Banking Solution in all Circles, covering 38% business. * Implementation of CBS would substantially enhance the Bank’s capability in introduction of new and innovative products at very short intervals across branches and other value-added services to customers on a 24X7 basis, tone up internal efficiency through straight-through transaction processing capabilities on a centralized database and improve operational effectiveness in the areas, such as, integration of multiple delivery channels, single window for meeting all needs of a customer, better MIS and improved security.This will take the Bank to a superior technology platform leading to near-zero branch level system administration, centralized generation of reports and zero-effort reconciliation of inter-branch entries as more and more branches shift to core banking platform.
* Core banking would integrate the trade finance, Treasury and ALM applications enabling efficient funds management and risk management capabilities. Value Added Services
* College/Hostel Fee Payment” through ATMs – Covered more than 67 Institutions sunder this scheme.
* Topping up of Mobile phones of Idea, Orange and Airtel transactions.
* Opening of Internet Banking accounts through ATMs for cardholders.
* ATM is increasingly used as cash point for SBI cards.
* Issue of monthly/quarterly season tickets for suburban trains of Central Railway at CST Mumbai.
* Cash as well as Cheque Deposit on ATM – Facility has been made
Operational on a pilot basis.
* Temple trust Donation facility now available for Vaishnodevi, Shri Sai Sansthan, Shirdi and Gurudwara Sahib, Nanded.Devotees can now offer their donations to these Temples through ATM.
* Online collection of Application fees for GATE & JMET 2006. * MTNL, Mumbai Bill payment through ATM.
PERSONAL BANKING FINANCE CELL :
To give focused attention to retail loans at branches, cells have been set up at 182 branches with many more to come.
BUSINESS PROCESS RE-ENGINEERING (BPR) :
The bank has undertaken BPR exercise and has engaged an international consultant as Advisor for the project. The objective of BPR initiative is to strengthen the bank’s ability to acquire new customers, build lasting relationship with existing customers and increase customer satisfaction through world-class service quality.
The BPR team is simplifying and redesigning processes to leverage the core banking solution platform. Strategies are being evolved for migrating transactions to full set of alternate channels namely, ATMs, Internet and Call Centers. The objective is to transform branches into sales and service focused outfits with all back-offices, non-customer facing transactions being moved out of branches to central processing cells.
SINGLE WINDOW SYSTEM :
To improve customer service and to free the staff for marketing, single window delivery system has been introduced at 7446 branches.
HUMAN RESOURCE DEPARTMENT
HUMAN RESOURCE DEPARTMENT
2. Human Resource Management at SBI
IMPORTANCE OF HUMAN RESOURCE MANAGEMENT
It has become the necessity for the organizations to keep HR Department because EMPLOYEES are the valuable asset of any organization. Each and every organization is concerned with personnel functions and that is the reason for keeping a separate Human Resource Department.
The personnel manager has the ultimate responsibility for all personnel and labor polices. This department helps the management in securing, utilizing and developing appropriate manpower to achieve the organizational objectives.
For this purpose, it performs several functions like recruitment, selection, compensation, promotion, transfer, training etc. It also relates to the maintenance of industrial peace and harmony, Industrial Relations, labor welfare activities, etc.
HUMAN RESOURCE MANAGEMENT AT SBI
The bank proposes to automate its HR processes with business objectives. Thus the bank has decided to implement an HRM solution which would handle all aspects of HRM, including payment of wages and salaries, CTC, performance management, training management, fixed assets etc.
STRATEGIC LEADERSHIP PROGRAMMES
Such programmes for officers in Senior Management grade, and Strategic HR initiatives were launched, and in addition,
Revamping of the Training System
It was undertaken to meet future needs of the Bank which is under implementation.
Industrial Relations includes maintaining the relations with the employees and colleague to maintain the industrial harmony and peace.
In order to increase the responsibilities of Senior or Special Assistants, their passing powers have been enhanced and duties enlarged.
RECRUITMENT AT SBI
As SBI is the government oranisation here for higher level of designation or post SBI prefers to follow the internal source of recruitment that is Promotion, Transfers, and demotion within the organization.
As far as other clerical job is concerned there is no recruitment going on for the post of officers and middle level jobs.
The External source of recruitment is used that is Advertisement in newspapers, magazines and web sites.
Here, major decisions regarding recruitment are taken by SBI Central Recruitment Board, Bombay.
SELECTION AT SBI
RECEIPT OF APPLICATION
THE RIGHT CANDIDATE
The usual policy for promotion is to promote the person on the basis of seniority or merit. Length of service, education, training course completed, previous work history etc. are factors, which are given weitht while deciding on a operativeness, merit, honesty, many informal influences are powerful determinants of a promotional policy.
PROMOTIONS AT SBI
There are three types of promotions at SBI :
* Fast Track Promotion
* Normal Channel Promotion
* Seniority Channel Promotion
FAST TRACK PROMOTION
It is applicable to the employees who have completed 2 years of job.
Such employees have to undergo
* A written test and
* Then group discussion and
* Personal interviews respectively.
More over, every employee should have secured 90 % and more marks and grade A in confidential performance appraisal report.
NORMAL CHANNEL PROMOTION
In this channel of promotion employees who have completed four or five years of their job are eligible and they have to udergo written test and group discussion and personal interview. Depending on personal records, performance appraisal, requirement of staff, grades and percentage in test, employees and promoted.
SENIORITY CHANNEL PROMOTION
It is basedon as the name suggests seniority level of an employee The promotion is given to them. As this type of promotion is only given to senior employees for the higher level of posts and designations, at times they have to also go for written test and at times they have to directly go for oral exams and interviews. Four scale of promotion are there. In this type of promotion, employees who have done 12 years of job are eligible for scale 1 and scale 2 promotion while employees who have completed 14 year of job and carries minimum 50% marks are eligible for scale 3 and scale 4 promotion,
Bank’s Training Philosophy
“Training in State Bank is a proactive, planned and continuous process as an integral part of organisational development. It seeks to impart knowledge, improve skills and reorient attitudes for individual growth and organisational effectiveness”. State Bank of India”s experience in training spans more than four decades and is based on an in-depth understanding of the business and banking environment, domestic as well as international.
TRAINING SYSTEM GOALS
* Feedback to corporate office to assist in policy formulation, product development * To act as a think-tank
* An internal consultant
* Organisational development interventions
* To conduct customised on-site programmes at our branches * Interventions at branch level for organisational development * Research & Development
* Group work
* Interface/panel discussions
* Case studies
* Group work
* Small group Work
* Role play
* Interface/panel discussions
* Customer interaction
* Training media: Audio-visual teaching aids and computer aided learning
-IN HOME LOAN DEPARTMENT
VARIOUS STAGES IN RESEARCH
Stage-1: PROBLEM IDENTIFIED
At the very first stage in research the researcher has to clearly identify and define the problem. A well defined problem helps the researcher in the research. As it said that
“A PROBLEM WELL DEFINED IS HALF SOLVED.”
My research problem is “What are the experiences & difficulties faced by customers in getting Housing loan from SBI?”
Stage-2: IDENTIFICATION OF RESEARCH OBJECTIVE
Identification of Research objective is very essential in any research because if the researcher fails to identify the research objective he may fail in his research and the researcher can not achieve ultimate results.
Research objectives are the end results.It directs and provides the base for the research plan.
The objectives of this research are:
1. Primary Objective :
To identify the difficulties faced by the customers in getting Housing loan from SBI and to find the gape.
2. Secondary Objective :
* To identify the expectations of the loan holders. * Based on the opinions and experiences of the customers, to give suggestions to remove this gape.
Stage-3: RESEARCH PLAN
For gathering the needed information the researcher needs to draw out the most efficient research plan based on well defined research objective.
Designing of research plan includes the following:
1. Data source
2. Research Approaches
3. Research Instruments
4. Research Methods
In market research data can be of two types:
In primary data the information is obtained from the original source by researcher. Here, information needed is “the perception of the loan holders from SBI regarding the processes involved in housing loans”, which is only possible through personal meets with them so it is primary data source.
The data, which is already collected and used, previously, is secondary data. For meeting the loan holders I got the personal information like name, address, telephone number etc. from their accounts so that is secondary data.
Primary data can be collected in four ways:
Observational research and survey research are two approaches, which have been used to meet the objectives of research.
Observational research has been carried out simultaneously with survey research.
Instruments Used in Research :
Researchers have a choice of two main research instruments in collecting primary data. * Questionnaires and
* Mechanical Devices
For surveying the housing loan holders of SBI, the research instrument used is questionnaires for each of them individually.
There are two methods of survey:
* Survey of population
* Survey of samples selected from the whole
To carry out the research, the method adopted here is the survey of the samples. First step to Sample Survey is designing the Sample Plan.
Sampling Plan basically deals with the following:
* Sample Size
* Sampling Method
* Sample size-100
* Sampling method -Simple Random sampling
* Instrument used
For survey -Questionnaire
Instruction: a) The purpose is to make survey only.
b) Information provided will be kept confidential
CONTACT NO.: _________________________________________
OCCUPATION:□ Business □ Profession □ Service
MONTHLY INCOME:□ 8000 to 15000□ Above 25000
□ 15000 to 25000
* Had you visited other banks before taking loan from SBI?
□ Yes□ No
* Reason for selecting SBI :
□ Nationalized bank
□ Lower interest rate
□ Good facilities
□ Lower cost
□ Speedy sanction
* How you received the related information?
□ In a single piece
□ In bit of pieces
* What was the gape between date of application and sanction of loan?
□ 1 to 5days□ 5 to 10 days
□ 10 to 15days□ 15 to 20 days
□ More than 20 days
* In your opinion, comparatively sanction process is:
□ Speedy□ Moderate □ Low
* Within how many days loan amount was disbursed?
□ 1 to 2□ 11 to 15
□ 3 to 5□ 16 to 20
□ 6 to10□ More than 20
* Did you face any difficulty in receiving disbursement?
□ Yes□ No
* In comparison with other banks the interest rates of SBI are:
□ Higher□ Lower
□ Equal to other banks
* Your suggestion: _______________________________________________________________
THE RESULTS OF THE SURVEY
DEPENDING ON THE VIEWS OF THE HOME LOAN HOLDERS OF SBI BASED ON THE QUESTIONNAIRE PREPARED.
OCCUPATION OF DIFFERENT CUSTOMERS
The above indicated results shows that more of the home loan holders are Businessmen.
There is not much variation between service and profession class as the number of both the class of the customers are nearly similler.
CLASSIFICATION OF THE CUSTOMERS ON THE BASES OF THEIR INCOME LEVEL BY DIVIDING THEM INTO SPECIFIC INCOME CLASS
The above graph shows that there is not much deviation among the different classes.
More of the home loan holders are having the monthly income between 15000 to 25000. Those having monthly income more than 25000 are lesser.
But looking to the overall scenario there is equal distribution among all the three income class.
NUMBER OF CUSTOMERS WHO HAD VISITED OTHER BANKS BEFORE TAKING LOAN FROM SBI
The graph shows that more of the loan holders had inquired, directly or through other sources like friends or relatives, other banks before taking loan from SBI.
THIS SHOWS HOW THEY RECEIVED BASIC INFORMATION
To the response of this question, more of the customers replied that they faced a little difficulty in receiving different information regarding basic information or the information about documentation.
REASONS GIVEN BY CUSTOMERS FOR SELECTING SBI
The above graph looks very unevenly distributed but it is due to the reason that the respondents gave more than one answer to this question. Some told that more than one reason are there for selecting SBI.
One of the reasons not mentioned through graph is “TRUSTWORTHYNESS” stated by some of the respondents.
GRAPH SHOWING THE TIME DURATION BETWEEN APPLICATION GIVEN BY CUSTOMERS AND LOAN SANCTIONED BY THE BANK
The above result is full of variations. During the survey, It was found that some of the first 22% customers got the loan sanctioned even within one day. On the contradictory part, some of 11% customers did not get the loan sanctioned even after 40 days of application. This was also due to the delay in submission of required documents by customer.
IF THE SANCTION OF LOAN WAS SPEEDY FROM THE VIEWPOINT OF CUSTOMERS
TIME TAKEN BY THE BANK TO DISBURSE THE LOAN AMOUNT TO THE CUSTOMERS AFTER
Gape between sanction and disbursement is generally found to be 2 to 8 days after sanction of the loan.
Some of the customer faced difficulty in receiving the disbursement of the loan. Few got the payment after a long wait of approximately a month. CUSTOMERS WHO FACED DIFFICULTY IN RECEIVING THE DISBURSEMENT OF THEIR LOAN AMOUNT
INTEREST RATES IN VIEW OF THE CUSTOMERS OF HOMELOAN DEPARTMENT
1. Liberalization in the loans is needed.
2. It was found that most of the customers who got the loans sanctioned fast, received the disbursement faster and those who got the loan sanctioned late, got the payment late than the average time. Of course, this can be due to unclarity on the part of customer. 3. Customers want that they should be able to get all the information from one person only so that they need not to run here and there.
4. Core banking should be fully helpful to the customers. In spite of core banking customers are still facing difficulty regarding flexibility for payment of installment. 5. Lower documentation should be there for the loans. As per customers view only really needed documents should be asked for. 6. Customers who got delayed sanction or delayed disbursement were dissatisfied and suggested to faster the operations of the bank.
7. Most of the customers expressed view that they prefer SBI more for the home loans as it is very good, as compared to the other private banks also, as far as the home loan’s aspect is considered 8. Dissatisfied customers told that the operations involved in sanction and disbursement needs to be made faster like that of private banks. 9. Fast response to the various inquiries of the customers is needed. Some customers as shown in the results complained that they got the information from more than one person. 10. The infrastructure facilities like good interior and air-conditioned branches
should be there.
11. Customers expect to be treated with politeness and respect. 12. Customer care should be given more importance.
13. More attracting facilities are needed.
14. Customers should be given full knowledge about the services inquired. 15. More connectivity with other banks.
16. Better front desk services are yet needed, customers are not yet fully satisfied with it. 17. For all the new coming schemes awareness should be created among people. 18. For entertainment of the waiting customers small T.V., Newspapers, Magazines etc should be there.
* Nationalized Bank
* Safety and security of money
* Highest number of ATMs
* Years of experience – Century
* Large Network
* Government Support
* Transparency in charges.
* Experienced employees
* Rigid work culture
* Lake of young employees
* Excessive Documentation
* All branches and Head offices are not having fully modern infrastructure.
* Constant fear in the minds of customers towards Private Banks. * Ever expanding rural, urban, and international market.
* Private Banks provides more facilities at low charges. * Shifting customer preference towards private banks.
* Dynamic employees and greater technological product of private banks. * Customer satisfaction is high in private banks.
1. PEOPLE :
* Good suggestions coming from employees side should be appreciated and implemented. * Motivational package for excellent work at the bank should be offered. * Employee integrity and sincerity should be rewarded.
* Make duty a desire of employees through Satisfying sociological, financial, status need of employees. * Work culture of employees should be like that of private banks employees. * Young and enthusiastic employees should be recruited for customer care services. All nationalized bank can join hands in this regard and can even seek approval from RBI. * System of hire and fire should be there for this new young employees up to particular age limit.
2. PROMOTION :
* To increase the young customers step-ins, SBI can install in house cyber cafes to attract the young customers in premises of SBI. * New schemes and constant recorded announcement of the products in the bank premises itself can attract the attention of customers visiting the bank at least during peak hours. * SBI is flooded by new generation products but they need intensive marketing especially for products like demat A/c, insurance, mutual fund and e-banking.
3. PRODUCT :
* Mobile banking, bill payment services, online tax payments, NRI tax advisory, Investment solutions should be given importance. * SBI should have tie up with big industries, schools, NGOs, hospitals, commercial complex, colleges etc for opening the salary A/C of their employees. * Too much documentation and complex procedure should be reduced to greater extent. For example, if a customer is having A/C with any nationalized bank then a simple check can be used for cross checking of their identity. * Women’s A/C :
At SBI study of profiles show that lesser number of women prefers SBI, while the fact is number of working women in Rajkot is improving day by day. To capture this section of society, saving A/c offering with different schemes for women can be planed out.
4. PHYSICAL ENVIRONMENT :
* Each and every counter should be named properly above the desk through hanging sign boards and name boards to minimize customer quarries. * Renovation is the need of SBI branches and good interior with pleasing environment is the demand of today’s competitive edge. * Cabin system should be destroyed and customer-employee interaction should be without any glass partition between them. This reduces the status gap and offers warm helping hands to customers’ problem solution. * Departmentation in the banks should be such that customers don’t need to ask anybody to search for required counter. * Chart showing the designation and department of concerned persons should be there inside the bank.