A PROJECT REPORT

On
COMPARITIVE STUDY OF
TERM DEPOSIT SCHEMES
BY BANKS

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT

FOR THE AWARD OF DEGREE OF
BACHELORS IN BUSINESS ADMINISTRATION.

(Session: 2009-2012)

UNDER THE GUIDANCE OF:

SUBMITTED BY:

Ms. SUPRIYA MAHESHWARI

MOHSIN AHMED BATLA

(FACULTY, MAIMS)

Roll no. 02614701709

Maharaja Agrasen Institute of Management Studies

Affiliated to Guru Gobind Singh Indraprastha University, Delhi
PSP Area, Plot No. 1, Sector 22, Rohini, Delhi 110086
1

Table of Contents

Student Declaration

Certificate from Guide

ii

Acknowledgement

iii

Chapter Scheme

iv

List of Tables

List of Charts

List of Graphs

vi

Executive Summary

vii

STUDENT DECLARATION

This is to certify that I have completed the Summer Project

titled Comparative Study of Term Deposit Scheme by
banks under the guidance of Ms. Supriya Maheshwari,
faculty of maims in partial fulfillment of the requirement for
the award of Degree of Bachelor of Business Administration at
Maharaja Agrasen Institute of Management Studies, Delhi. This
is an original piece of work & I have not submitted it earlier
elsewhere.

Name:

Mohsin Ahmed Batla

University Enrollment No.: 02614701709

1

CERTIFICATE FROM THE

INSTITUTE GUIDE

This is to certify that the summer project titled Comparative

Study of Term Deposit Scheme by banks is an academic
work done by Mohsin Ahmed Batla submitted in the partial
fulfillment of the requirement for the award of the degree of
Bachelor of Business Administration at Maharaja Agrasen
Institute of Management Studies, Delhi, under my guidance &
direction.

To the best of my knowledge and belief the data & information

presented by him/her in the project has not been submitted
earlier.

Signature
Name of the Faculty:
Designation:

Ms. Supriya Maheshwari

Faculty of MAIMS

ACKNOWLEDGEMENT

Success is an effort bounded activity that involves co-operation of all.

I hereby take the opportunity to express my profound sense of gratitude and

reverence to all those who have helped and encouraged me towards successful
completion of the Project Report. It has been a great experience working in the
field of finance

I would like to thank my Project Guide Ms. Supriya Maheshwari for his
immense guidance, valuable help and the opportunity provided to me to
complete the project under his guidance.

I would like to thank all faculty members of Maharaja Agarsen Institute of

Management Studies for guiding and supporting me in the completion of project
from time to time.

Mohsin Ahmed Batla

Enrollment no. - 02614701709

Executive Summary

The Indian economic is growing. There are various factors

contributing for the development of economy. One of the industries
which have revolutionized the economy is banking. Banks channelize
individual savings into capital formation, leading to faster growth of
an economy. Most prominent and important source of money to bank
is through Term Deposits or Fixed Deposits.

Term Deposits is an investment alternative for an individual which

provide him a fixed return over a fixed period of time. Banks offers
distinct rate of return for different period of time targeting different
segments of market.

I have undertaken my study in the area of term deposits to study and

compare rate of interest provided by different banks to the costumers.

The Project is titled comparative study of Term Deposit Schemes by

Banks.

List of Tables
Table 3.1:

Interest rate on term deposit by SBI

Table 3.2:

Interest rate on fixed deposit by ICICI for amount

below rupee 15 lakhs

Table 3.3:

Interest rate on fixed deposit by ICICI for amount

above rupee 15 lakhs upto rupee 1 crore

Table 3.4:

Interest rate on fixed deposit by Standard Chartered

Bank

Table 3.5:

Interest rate on fixed deposit by PNB

Table 3.6:

Interest rate on fixed deposit by Canara Bank

Table 4.1:

comparative interest Rates

Table 4.2:

comparative interest Rates (senior Citizen)

List of Charts

Chart 1.1:

Structure of the organized banking sector in India.

List of Graphs
Graph 3.1:

Interest Rate on Term Deposit by SBI

Graph 3.2:

Interest rate on fixed deposit by ICICI for amount

below rupee 15 lakhs

Graph 3.3:

Interest rate on fixed deposit by ICICI for amount

above rupee 15 lakhs upto rupee 1 crore

Graph 3.4:

Interest rate on fixed deposit by Standard Chartered

Bank

Graph 3.5:

Interest rate on fixed deposit by PNB

Graph 3.6:

Interest Rate on Term Deposit by SBI

Table of Content
Chapter 1

Introduction to Indian
Banking Industry
- History
- Rapid Growth After Liberalization policy of
1991
- Reserve Bank of India
- Sectors of Indian Banking
- About Term Deposits

Chapter 2

Methodology
- Purpose of Study
- Research Methodology

Chapter 3

Bank Profile and Data

-

Chapter 4

State bank of India

ICICI Bank
Standard Chartered Bank
Punjab National Bank
Canara Bank

Findings & Analysis

- Comparative analysis of Term Deposits or
Fixed Deposits of General Public
- Comparative analysis of Term Deposits or
Fixed Deposits of Senior Citizens

Chapter 5

Conclusion
- Conclusion

Chapter 6

Suggestion or
Recommendations
- Suggestions

Chapter 7

Limitations of the Study

- Limitations

Bibliography

CHAPTER 1

Introduction to
Indian Banking
Industry

History
Banking in India originated in the last decades of the 18th century. The first banks were The
General Bank of India which started in 1786, and the Bank of Hindustan, both of which are
now defunct. The oldest bank in existence in India is the State Bank of India, which
originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank
of Bengal. This was one of the three presidency banks, the other two being the Bank of
Bombay and the Bank of Madras, all three of which were established under charters from the
2

British East India Company. For many years the Presidency banks acted as quasi-central
banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of
India, which, upon India's independence, became the State Bank of India.

Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The Comptoire
d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862;
branches in Madras and Puducherry, then a French colony, followed. HSBC established itself
in Bengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade
of the British Empire, and so became a banking center.

The period between 1906 and 1911, saw the establishment of banks inspired by the Swadeshi
movement. The Swadeshi movement inspired local businessmen and political figures to found
banks of and for the Indian community. A number of banks established then have survived to
the present such as Bank of India, Corporation Bank, Indian Bank, Bank of Baroda, Canara
Bank and Central Bank of India.

Rapid Growth after

Liberalization policy of 1991
In the early 1990s, the then Narsimha Rao government embarked on a policy of liberalization,
licensing a small number of private banks. These came to be known as New Generation techsavvy banks, and included Global Trust Bank (the first of such new generation banks to be set
up), which later amalgamated with Oriental Bank of Commerce, Axis Bank(earlier as UTI
Bank), ICICI Bank and HDFC Bank. This move, along with the rapid growth in the economy
3

of India, revitalized the banking sector in India, which has seen rapid growth with strong
contribution from all the three sectors of banks, namely, government banks, private banks and
foreign banks.
The next stage for the Indian banking has been set up with the proposed relaxation in the
norms for Foreign Direct Investment, where all Foreign Investors in banks may be given
voting rights which could exceed the present cap of 10%,at present it has gone up to 74% with
some restrictions.
The new policy shook the Banking sector in India completely. Bankers, till this time, were
used to the 4-6-4 method (Borrow at 4%;Lend at 6%;Go home at 4) of functioning. The new
wave ushered in a modern outlook and tech-savvy methods of working for traditional banks.
All this led to the retail boom in India. People not just demanded more from their banks but
also received more.
Currently (2007), banking in India is generally fairly mature in terms of supply, product range
and reach-even though reach in rural India still remains a challenge for the private sector and
foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered
to have clean, strong and transparent balance sheets relative to other banks in comparable
economies in its region. The Reserve Bank of India is an autonomous body, with minimal
pressure from the government. The stated policy of the Bank on the Indian Rupee is to
manage volatility but without any fixed exchange rate-and this has mostly been true.
With the growth in the Indian economy expected to be strong for quite some time-especially
in its services sector-the demand for banking services, especially retail banking, mortgages
and investment services are expected to be strong. One may also expect M&As, takeovers,
and asset sales.
In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake in
Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has
been allowed to hold more than 5% in a private sector bank since the RBI announced norms
in 2005 that any stake exceeding 5% in the private sector banks would need to be vetted by
them.

Reserve Bank of India

The Reserve Bank of India is the main monetary authority of the country and beside that the
central bank acts as the bank of the national and state governments. It formulates, implements
and monitors the monetary policy as well as it has to ensure an adequate flow of credit to
productive sectors. Objectives are maintaining price stability and ensuring adequate flow of
credit to productive sectors. The national economy depends on the public sector and the
4

central bank promotes an expensive monetary policy to push the private sector since the
financial market reforms of the 1990s.

Functions:
Manager of exchange control
The central bank manages to reach the goals of the Foreign Exchange Management Act, 1999.
Objective: to facilitate external trade and payment and promote orderly development and
maintenance of foreign exchange market in India.

Issuer of currency
The bank issues and exchanges or destroys currency and coins not fit for circulation. The
Objectives are giving the public adequate supply of currency of good quality and to provide
loans to commercial banks to maintain or improve the GDP. The basic objectives of RBI are
to issue bank notes, to maintain the currency and credit system of the country to utilize it in its
best advantage, and to maintain the reserves. RBI maintains the economic structure of the
country so that it can achieve the objective of price stability as well as economic
development, because both objectives are diverse in themselves.

Developmental role
The central bank has to perform a wide range of promotional functions to support national
objectives and industries. The RBI faces a lot of inter-sectoral and local inflation-related
problems. Some of these problems are results of the dominant part of the public sector.

Related functions
The RBI is also a banker to the Government and performs merchant banking function for the
central and the state governments. It also acts as their banker. The National Housing Bank
(NHB) was established in 1988 to promote private real estate acquisition. The institution
maintains banking accounts of all scheduled banks, too.
There is now an international consensus about the need to focus the tasks of a central bank
upon central banking. RBI is far out of touch with such a principle, owing to the sprawling
mandate described above. The recent financial turmoil world-over, has however, vindicated
the Reserve Bank's role in maintaining financial stability in India.

Sectors of Indian Banking

5

Chart 1.1: Structure of the organized banking sector in India.

Number of banks is in brackets.

The commercial banking structure in India consists of:

Scheduled Commercial Banks in India

Unscheduled Banks in India

Scheduled Banks in India constitute those banks which have been included in the Second
Schedule of Reserve Bank of India (RBI) Act, 1934. RBI in turn includes only those banks in
this schedule which satisfy the criteria laid down vide section 42 (6) (a) of the Act.
There were 300 scheduled banks in India having a total network of 64,918 branches. The
scheduled commercial banks
In India comprise of State bank of India and its associates (8), nationalised banks (19), foreign
banks (40), private sector banks (30), co-operative banks and regional rural banks.

Names of Banks operating in their

respective sectors

Public Sector

State Bank of India

State Bank of Bikaner and Jaipur

State Bank of Hyderabad

State Bank of Indore

State Bank of Mysore

State Bank of Saurashtra

State Bank of Travancore

Andhra Bank

Allahabad Bank

Bank of Baroda

Bank of India

Bank of Maharashtra

Canara Bank

Central Bank of India

Corporation Bank

Dena Bank

Indian Overseas Bank

7

Indian Bank

Oriental Bank of Commerce

Punjab National Bank

Punjab and Sind Bank

Syndicate Bank

Union Bank of India

United Bank of India

UCO Bank

Vijaya Bank

Private Sector

ING Vysya Bank Ltd

Axis Bank Ltd

Indusind Bank Ltd

ICICI Bank Ltd

South Indian Bank

HDFC Bank Ltd

Centurion Bank Ltd

Bank of Punjab Ltd

8

IDBI Bank Ltd

Jammu & Kashmir Bank Ltd.

Foreign Banks in India:

American Express Bank Ltd.

ANZ Gridlays Bank Plc.

Bank of America NT & SA

Bank of Tokyo Ltd.

Banquc Nationale de Paris

Barclays Bank Plc

Citi Bank N.C.

Deutsche Bank A.G.

Hongkong and Shanghai Banking Corporation

Standard Chartered Bank.

The Chase Manhattan Bank Ltd.

Dresdner Bank AG.

About Term Deposits

A Fixed Deposit also known as a Term Deposit is an account 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 9.5% or more. Just deposit your savings at a bank of your
choice and watch your money grow over time. Browse through the wide range
of Fixed Deposit options and select the one that suits your needs the most.
The most unusual characteristic of a fixed deposit is that the funds cannot be
withdrawn for a specified period of time. In most cases, fixed deposits carry
duration of five years. During that time, the money remains in the account and
cannot be withdrawn for any reason. Individuals, corporate entities, and even
non-profit organizations that wish to set aside funds and limit their access to the
funds for a period of time often find that fixed deposits are a simple way to
accomplish this goal. As an added benefit, the monies in the account will earn a
fixed rate of interest regardless of any fluctuations in interest rates that apply to
other types of accounts.
However, both these benefits can also turn into disadvantages under certain
circumstances. Because the money cannot be withdrawn until the duration is
complete, the funds cannot be used even in emergency situations. Changes in the
going interest rate may also rise to a point above and beyond the interest rate
applied to existing deposits. This means account holders are actually earning
less interest with fixed deposits than with other types of loans and accounts.
While the interest rate on fixed deposits cannot be changed, there is sometimes a
way to work around the issue of obtaining use of funds in an emergency
situation. At times, the lending institution where the fixed deposit is placed may
be willing to extend a separate loan to the account holder, using the fixed
account as collateral. While not ideal, this can at least make it possible to deal
with the current financial crunch.

10

CHAPTER 2

Methodology
11

Purpose of Study
To Study Term Deposit Schemes offered by Different Banks.
To analyse and find the optimum Scheme for a particular Customer

12

Research Methodology

13

CHAPTER 3
Bank Profiles and Data

State bank of India

14

Type: Public (BSE: 500112, LSE: SBID)

Industry: Banking, Financial services
Founded: 1 July 1955
Headquarters: Mumbai, Maharashtra, India
Key people: Mr. O. P. Bhatt (Chairman)
Products:
Investment Banking
Consumer Banking
Commercial Banking
Retail Banking
Private Banking
Asset Management
Pensions
Mortgages
Credit Cards

Revenue: 85,962.07 crore (US$19.34 billion) (2010)

Profit: 9,166.05 crore (US$2.06 billion) (2010)
Total assets: $323.04 billion (2010)
Total equity: $18.519 billion (2010)
Owner(s): Government of India
Employees: 200,299 (2010)
Website: www. Statebankofindia.com

Introduction

15

State Bank of India (Hindi: ) (SBI) is the largest state-owned banking and
financial services company in India, by almost every parameter - revenues, profits, assets,
market capitalization, etc. The bank traces its ancestry to British India, through the Imperial
Bank of India, to the founding in 1806 of the Bank of Calcutta, making it the oldest
commercial bank in the Indian Subcontinent. Bank of Madras merged into the other two
presidency banks, Bank of Calcutta and Bank of Bombay to form Imperial Bank of India,
which in turn became State Bank of India. The Government of India nationalized the Imperial
Bank of India in 1955, with the Reserve Bank of India taking a 60% stake, and renamed it the
State Bank of India. In 2008, the Government took over the stake held by the Reserve Bank of
India.

SBI provides a range of banking products through its vast network of branches in India and
overseas, including products aimed at NRIs. The State Bank Group, with over 16,000
branches, has the largest banking branch network in India. With an asset base of $352 billion
and $285 billion in deposits, it is a regional banking behemoth. It has a market share among
Indian commercial banks of about 20% in deposits and advances, and SBI accounts for almost
one-fifth of the nation's loans.

SBI has tried to reduce over-staffing by computerizing operations and "golden handshake"
schemes that led to a flight of its best and brightest managers. These managers took the
retirement allowances and then went on to become senior managers in new private sector
banks.

The State bank of India is the 29th most reputed company in the world according to Forbes.

Term Deposit

16

Highlights
Safety - We understand the value of your hard earned money and continue to deliver on our
promise of safety and security over 200 years.
Liquidity Loan /overdraft facility: You can avail a loan/overdraft against your deposit. SBI
provides you loan / overdraft up to 90% of your deposit amount at nominal cost. So you
continue to earn interest in your deposit and still can meet your urgent financial requirements.
Premature Withdrawal
Interest to be charged on premature withdrawal of term deposits at 1.00% below
the rate applicable for the period deposit has remained with the Bank.

Transferability- Transfer of Term Deposits between our wide networks of

branches without any charge.

Compounding / Flexible / Timely Payment of Interest - Under our Special

Term Deposit Scheme, interest accrues in your account and gets compounded
quarterly. Besides, we assure timely delivery of the proceeds of your deposit with
interest, on maturity. Flexibility of payment on maturity through Cash (subject to
prevalent Income Tax Act), Banker's Cheque, Credit in Savings Bank/Current
account.

Term Deposits are available at all SBI Branches

Easy and convenient access of 24X7 information at SBI Internet Banking.
Nomination Facility - Available.

Automatic Renewals - There is no need for you to keep track of the maturity of your
deposits. Your deposits with us will be renewed automatically, post maturity and you continue
to earn interest for same period as that of your matured deposit, at the interest rate prevailing
at the time of maturity. Automatic renewals take place where there are no standing
instructions for renewal.
Flexibility to convert your Special Term Deposit to Term Deposit and vice versa

You can convert your special Term Deposit to a Term Deposit to receive
monthly/quarterly interest payments to match your financial requirements. Quarterly
interest at calendar quarter is also available.
You can also convert your Term Deposit to a Special Term Deposit, which provides
compounded rate of interest to multiply your money faster.
17

Interest rates for Domestic Term Deposits

Below Rupees One Crore
Effective from the 01.10.2010 would be as under:

Tenors

General

Senior
Citizen

15 days to 45 days
46 days to 90 days
91 days to 180 days
181 days to less than 1 year
1 year to 554 days
555 days
556 days to less than 2 years
2 years to 999 days
1000 days
1001days to less than 3 years
3 year to less than 5 years
5 years to less than 8 years
8 years and up to 10 years

4.00
4.00
5.50
6.00
7.00
7.50
7.25
7.50
7.75
7.25
7.25
7.50
7.75

Table 3.1: Interest rate on term deposit by SBI

18

4.00
4.00
5.50
6.00
7.50
8.00
7.75
8.00
8.25
7.75
7.75
8.00
8.25

Graphical Representation of Interest Rates

4
General
Senior Citizen

Graph 3.1: Interest Rate on Term Deposit by SBI

19

ICICI Bank

Type: Public (BSE: 532174, NYSE: IBN)

Industry: Banking, Financial services
Founded: 1955
Headquarters: Mumbai, Maharashtra, India
Key people :
K.V. Kamath (Chairman)
Chanda Kochhar (MD & CEO)
N. S. Kannan (CFO)
Products :
Investment Banking
Commercial Banking
Retail Banking
Private Banking
Asset Management
Mortgages
Credit Cards

Revenue: 59,599.77 crore (US$12.93 billion) (2009)

Operating income: 6,578.64 crore (US$1.43 billion) (2010)
Profit: 4,843.41 crore (US$1.05 billion) (2010)
Total assets: US$ 100.10 billion (2010)
Employees: 35,000+ (2009)
Website: www.ICICIBank.com

Introduction
20

ICICI Bank (formerly Industrial Credit and Investment Corporation of India) is a major
banking and financial services organization in India. It is the third largest bank in India and
the largest private sector bank in India by market capitalization. The bank also has a network
of 2,016 branches (as on 31 March 2010) and about 5,219 ATMs in India and presence in 18
countries, as well as some 24 million customers (at the end of July 2007). ICICI Bank offers a
wide range of banking products and financial services to corporate and retail customers
through a variety of delivery channels and specialization subsidiaries and affiliates in the
areas of investment banking, life and non-life insurance, venture capital and asset
management. (These data are dynamic.) ICICI Bank is also the largest issuer of credit cards in
India. ICICI Bank's shares are listed on the stock exchanges at BSE, NSE, Kolkata and
Vadodara (formerly Baroda) ; its ADRs trade on the New York Stock Exchange (NYSE).

The Bank is expanding in overseas markets and has the largest international balance sheet
among Indian banks. ICICI Bank now has wholly owned subsidiaries, branches and
representatives offices in 19 countries, including an offshore unit in Mumbai. This includes
wholly owned subsidiaries in Canada, Russia and the UK (the subsidiary through which the
HiSAVE savings brand is operated), offshore banking units in Bahrain and Singapore, an
advisory branch in Dubai, branches in Belgium, Hong Kong and Sri Lanka, and representative
offices in Bangladesh, China, Malaysia, Indonesia, South Africa, Thailand, the United Arab
Emirates and USA. Overseas, the Bank is targeting the NRI (Non-Resident Indian) population
in particular.

Fixed Deposit
21

Wide range of tenures.

Choice of investment plans.

Partial withdrawal permitted.

Safe custody of fixed deposit receipts.

Auto renewal possible.

Loan facility available.

Features
You can invest in our Fixed Deposit for as long as you wish between 7 days to 10 years.
All fixed deposits come with a set choice of investment plans. Fixed Rate Deposit accounts
also provide Fixed Loans. Re-investment Fixed Deposit rates do not change but work likes a
Recurring Debit Account transaction. In other words, Re-investment Plans are compounded
over traditional deposits and hence are more lucrative over different time periods.

Benefits
Fixed Deposits at ICICI Bank comes with nomination facility. We also offer online access to
your Fixed Deposits through our Internet Banking channel. Internet Banking at ICICI Bank
allows you to connect your Credit Card, Loan and your Fixed Deposit with your savings
account.
In re-investment deposits, the interest is compounded quarterly and reinvested with the
principal.

22

Interest rates for Fixed Deposits

Effective from the 01.10.2010 would be as under:
Interest rates on Fixed Deposit
For amount below Rupee 15 lakhs
Tenors

General

Senior
Citizen

7 days to 60 days
61 days to 90 days
91 days to 184 days
185 days to 269 days
270 days to less than 1 year
1 year to 389 days
390 days
391 days to 589 days
590 days
591 days to less than 2 year
2 years to 789 days
790 days
791 days to 989 days
990 days
991 days to less than 3 years
3 years to less than 10 years
Tax Saver FD 80C (5 year)
Upto Rs. 1 lacks

23

3.75
3.75
5.75
6.25
6.50
6.75
7.25
6.75
7.50
6.75
7.50
7.75
7.50
8.00
7.50
8.00
8.00

4.25
4.75
6.25
6.75
7.00
7.25
7.75
7.25
8.00
7.25
8.00
8.25
8.00
8.50
8.00
8.50
8.50

Table 3.2: Interest rate on fixed deposit by ICICI for amount

Below rupee 15 lakhs

Graphical Representation of Interest Rates

4
General

Senior Citizen

Graph 3.2: Interest rate on fixed deposit by ICICI for amount

Below rupee 15 lakhs
24

Interest rates on Fixed Deposit

For amount above Rupee 15 lakhs upto rupee 1 crore
Tenors

General

Senior
Citizen

7 days to 60 days
61 days to 90 days
91 days to 120 days
121 days to 184 days
185 days to 269 days
270 days to less than 1 year
1 year to 389 days
390 days
391 days to 589 days
590 days
591 days to less than 2 years
2 years to 789 days
790 days
791 days to 989 days
990 days
991 days to less than 3 years
3 years to less than 10 years

3.75
4.25
5.25
5.50
6.25
6.50
6.75
7.25
6.75
7.50
6.75
7.50
7.75
7.50
8.00
7.50
8.00

4.25
4.75
5.75
6.00
6.75
7.00
7.25
7.75
7.25
8.00
7.25
8.00
8.25
8.00
8.50
8.00
8.50

Table 3.3: Interest rate on fixed deposit by ICICI for amount

Above rupee 15 lakhs upto rupee 1 crore

25

Graphical Representation of Interest Rates

4
General

Senior Citizen

Graph 3.3: Interest rate on fixed deposit by ICICI for amount

Above rupee 15 lakhs upto rupee 1 crore
26

Standard Chartered Bank

Type: Public
LSE: STAN
SEHK: 2888
OTCBB: SCBFF
NSE: STAN
Industry : Banking, Financial services
Area served: Worldwide
Key people :
John W. Peace (Chairman of the Board)
Peter A. Sands (CEO)
Jaspal Singh Bindra (Director and CEO, Asia)
Products:
Finance and insurance
Consumer Banking
Corporate Banking
Investment Banking
Investment Management
Private Banking
Private Equity
Mortgage loans
Credit Cards
Revenue: $15.184 billion (2009)
Operating income: $5.151 billion (2009)
Net income: $3.477 billion (2009)
27

Total assets: $436.653 billion (2009)

Total equity: $27.930 billion (2009)
Employees: 80,000 (2010)
Website: www.StandardChartered.com, www.StandardChartered.co.in

Introduction
The Chartered Bank opened its first overseas branch in India, at Kolkata, on 12 April 1858.
Eight years later the Kolkata agent described the Bank's credit locally as splendid and its
business as flourishing, particularly the substantial turnover in rice bills with the leading Arab
firms. When The Chartered Bank first established itself in India, Kolkata was the most
important commercial city, and was the centre of the jute and indigo trades. With the growth
of the cotton trade and the opening of the Suez Canal in 1869, Bombay took over from
Kolkata as India's main trade centre. Today the Bank's branches and sub-branches in India are
directed and administered from Mumbai (Bombay) with Kolkata remaining an important
trading and banking centre.
Standard Chartered Bank is the largest Foreign Bank Sector in India.
Standard Chartered Bank is a British financial services company headquartered in London,
England with operations in more than seventy countries. It operates a network of over 1,700
branches and outlets (including subsidiaries, associates and joint ventures) and employs
80,000 people.

Despite its British base, it has few customers in the United Kingdom and around 90% of its
profits come from Asia, Africa, and the Middle East. Because the bank's history is entwined
with the development of the British Empire, its operations lie predominantly in former British
colonies, though over the past two decades it has expanded into countries that have
historically had little British influence. It aims to provide a safe regulatory bridge between
these developing economies.

It now focuses on consumer, corporate, and institutional banking, and on the provision of
treasury servicesareas in which the Group had particular strength and expertise.

Standard Chartered have recently signed a four-year sponsorship deal with the football club
Liverpool F.C, which started on 1 July 2010.
28

Standard Chartered is listed on the London Stock Exchange, Hong Kong Stock Exchange and
the Indian Stock Exchanges and is a constituent of the FTSE 100 Index. Its largest
shareholder is Temasek Holdings.

Term Deposit

With a wide variety of options to suit different needs, including Short Term Deposit,
Reinvestment Deposit, Simple Fixed Deposit and Monthly Income Plan, they can be opened
by individuals, proprietors, partnership and limited companies, societies, clubs, associations
and HUFs.
In case you need to withdraw amounts in excess of what is available in your transaction
account, we will break your deposit for the exact amount you require. The rest of the deposit
continues earning the original high interest.

Tenor ranges from 15 days to 5 years (For deposits of Rs. 15 Lakhs and above,
minimum tenor is 7 days)

Minimum amount of first deposit is Rs.50,000. Subsequent deposit can be made of a

minimum value of Rs.10,000 and in multiples of Rs.1,000 thereafter

Options of simple interest and compound interest

Auto renewal facility

Overdraft facility available against deposit

Preferential rates given for large value deposits of Rs.15 Lakhs and above

29

Interest Rate on Term Deposit for Term Deposits

w.e.f. October 01, 2010
Tenors

General

Senior
Citizen

Table
Interest
fixed
by
Chartered

15-29 days
30-45 days
46-59 days
60-89 days
90-179 days
180 days <= 210 days
211 days
212 days <= 260 days
261 days
262 days < 1 year
1 year <= 398 days
399 days
400 days < 18 months
>=18 Months < 2 years
2 years < 3 years
3 years < 4 years
4 years <= 5 years

4.50
4.80
4.85
4.90
5.55
5.60
6.50
5.60
5.60
5.60
5.70
7.25
5.70
6.10
6.25
6.50
7.00

4.50
4.80
4.85
4.90
5.55
5.60
5.60
5.60
7.00
5.60
5.70
7.50
5.70
6.10
6.25
6.50
7.00%

3.4 :
rate on
deposit
Standard
Bank

Graphical Representation of Interest Rates

30

8.00%

7.00%

6.00%

5.00%

4.00%
General

3.00%

Senior Citizen

2.00%

1.00%

0.00%

Graph 3.4: Interest rate on fixed deposit by Standard Chartered Bank

Punjab National Bank

31

Type: Public (BSE: 532461)

Industry: Banking, Financial services, Insurance
Founded: Lahore (1895)
Headquarters: New Delhi, India
Products :
Investment Banking
Consumer Banking
Commercial Banking
Retail Banking
Private Banking
Asset Management
Pensions
Mortgage loans
Credit Cards
Life Insurance

Revenue: US$2.32 billion (2005)

Employees: 580,300
Website: www.PNBIndia.com

Punjab National Bank (PNB) is a state-owned financial services company located in New
Delhi, India. It was registered on May 19, 1894 under the Indian Companies Act with its
office in Anarkali Bazaar Lahore. Today, the Bank is the second largest government-owned
commercial bank in India with about 5000 branches across 764 cities. It serves over 37
million customers. The bank has been ranked 248th biggest bank in the world by the Bankers
Almanac, London. The bank's total assets for financial year 2007 were about US$60 billion.
PNB has a banking subsidiary in the UK, as well as branches in Hong Kong, Dubai and
Kabul, and representative offices in Almaty, Dubai, Oslo, and Shanghai.

Term Deposit

Features:
32

Initial Deposit of Rs.1000/-only, and thereafter in convenient multiples of any amount

of Rupee one
Period of Deposit: (a) Maturity Option: For any period from 15 days to 120 monthsFor a single Term Deposit less than Rs. 15 lacks and for any period from 7 days to 120
months-For
a
single
Deposit
of
Rs.
15
lacks
&
above.
(b) Income Option: For any period from 6 months to 120 months.
At PAR Collection of Fixed Deposit Receipt
Payable at par at all CBS branches(premature payment, loans another miscellaneous
matters before maturity of the FDR shall be attended to only by the issuing branch)
Multiple options available for interest payment viz. Monthly/Quarterly/HalfYearly/Yearly or on maturity
For an amount of Rs. 10,000/- and above overdraft with cheque book facility is
available, to enable use of deposits. The customer shall also be at liberty to make use
of the facility through ATM-cum-Debit Card under 'Anywhere-Anytime Banking'. It
will enable customers to have freedom to utilise their Fixed Deposits as and when
needed without even coming to the Bank. The interest is chargeable only for the
amount and period for which the overdraft facility has been availed; the illiterate and
blind persons can also open the account without exercising the option of Overdraft
Facility.
Margin and rate of interest on Loans against deposits under the scheme shall be as per
prescribed guidelines which shall be subject to modifications from time to time
Automatic payment of LOCKER rent out of Interest proceeds
Conversion facility regarding mode of payment of interest allowed;(provided FDR has
been issued for a period of 12 months or more and remaining period of FD is more
than 6 months) without invoking any penal provision
Penalty clause, as per Banks guidelines, would be applicable to all term deposits
schemes including recurring deposits.
Automatic Renewal facility is provided as per option exercised by the depositor
Availability of premature extension
Part withdrawal in multiples of Rs.1000/- without loss of interest on remaining FDR

Domestic Term Deposit Interest Rates (% p.a.)

w.e.f. 01.10.2010

33

Tenors

General

Senior
Citizen

7 to 14 days
15 to 45 days
46 to 60 days
61 to 90 days

2.50
3.00
4.00

3.00
3.50
4.50

4.00

4.50

91 to 179 days
180 days to 270 Days
271 days to less than 1 year
1 year to less than 2 years
2 years to less than 3 years
3 years to less than 5 years
5 years to less than 9 years
9 years to 10years

5.50
6.25
6.50
7.25
7.25
7.50
7.75
8.00

6.00
6.75
7.00
7.75
7.75
8.00
8.25
8.50

Table 3.5: Interest rate on fixed deposit by PNB

Graphical Representation of Interest Rates

34

4
General
3

Senior Citizen

Graph 3.5: Interest rate on fixed deposit by PNB

Canara Bank
35

Type: Public (BSE: 532483, NSE: CANBK)

Industry: Banking, Financial services
Founded: Canara Bank Hindu Permanent Fund (1906)
Canara Bank Ltd (1910)

Canara Bank (1969)

Headquarters: Bangalore, India
Key people: S.Raman, (Chairman & MD)
Jagdish Pai K L , (Executive Director)
Products:
Investment Banking
Consumer Banking
Commercial Banking
Retail Banking
Private Banking
Asset Management
Pensions
Mortgages

Credit Cards
Employees: 47,389 (200405)
Website: www.Canarabank.com

Canara Bank (Hindi: ) is a state-owned financial services company in India. It was

established in 1906, which makes it among the older Indian banks. As on 2009 November, the
bank had a network of 3057 branches, spread across India. The bank also has offices abroad in
London, Hong Kong, Moscow, Shanghai, Doha, and Dubai. In terms of business it is one of
the largest nationalized commercial banks in India, with a total business of about Rs.2 trillion
(US$ 44 Billion).

Fixed Deposit
Details:

36

FIXED DEPOSIT

ELIGIBILITY

Individual, Joint (not more than 4), a Guardian on behalf of a minor,

HUF, Partnership, a Company, Association or any other Institution

INVESTMENT

Minimum - Rs.1000
Maximum - No ceiling

PERIOD OF
DEPOSIT

Minimum 15 days (7-14 days Only for single deposit of Rs.5 lakhs
and above)
Maximum 120 months

INTEREST RATE

Depending upon the period of the deposit as prevailing from time to

time.

PERIODICITY OF
Monthly (at discounted rates), Quarterly, Half-yearly or Annual
INTEREST
intervals as per depositor's choice
PAYMENT

SPECIAL RATE
FOR SENIOR
CITIZEN

Additional 0.50% rate of interest for deposits less than Rs.1 crore.

TDS ON
INTEREST

Applicable

NOMINATION
FACILITY

Available

LOAN FACILITY

Available upto 90% of the deposit amount

37

PENALTY FOR
PRE-MATURE
CLOSURE

No penal cut.

EXTRA
FACILITY

Facility of part withdrawal of deposits in units of Rs.1000/- keeping

the rest of the deposit to earn contracted rate of interest.

APPLICATION &
DOCUMENTS

Application Form
Form 60 or 61 (if customer does not have PAN Card)
Photograph of depositor/s (2 copies)
Proof of address as per KYC Norms
Any other related documents as applicable to proprietor ship
concern, Partnership Firm, Company, HUF etc

Domestic Term Deposit Interest Rates (% p.a.)

w.e.f. 15.09.2010

38

Tenors

General

Senior

Public

Citizen

7 days to 14 days

2.50

3.00

15 days to 30 days

3.50

4.00

31 days to 45 days

3.50

4.00

46 days to 90 days

4.00

4.50

91 days to 179 days

5.50

6.00

180 days to 269 days

6.00

6.50

270 days to less than 1 year

6.00

6.50

1 year & above to 554 days

7.00

7.50

555 days

7.25

7.75

7.00

7.50

2 years & above to 999 days

7.25

7.75

1000 days

7.50

8.00

7.25

7.75

7.25

7.75

7.50

8.50

7.75

8.75

556 days & above to less than 2

years

Table
Interest
fixed
by
Bank

1001 days & above to less than 3

years
3 years & above to less than 5
years
5 years & above to less than 8
years
8 years & above to 10 years

39

3.6:
rate on
deposit
Canara

Graphical Representation of Interest Rates

10
9
8
7
6
5
4
3

General
Senior Citizen

2
1
0

Graph 3.6: Interest Rate on Term Deposit by SBI

40

CHAPTER 4
Analysis
&
Findings
5
4.5
4
3.5
3

2.5

1.5
1
Z

0.5
0

Y
A

41

X
D

Comparative analysis
of
Term Deposit
or
Fixed Deposit
for
General Public

42

Table Showing Different Interest Rates by Banks

For Different Time Period
Time Period
Days/ Year
(upper
Limits)
7
14
29
45
60
90
120
180
210
270
1yr
389
390
391
399
400
540
555
556
590
591
2yr
790
791
990
991
1000
1001
3yr
4yr
5yr
8yr
9yr
10yr

SBI

4
4
4
4
5.5
5.5
6
6
6
7
7
7
7
7
7.5
7.5
7.25
7.25
7.25
7.5
7.5
7.5
7.5
7.5
7.75
7.25
7.25
7.25
7.5
7.75
7.75
7.75

ICICI
ICICI
SCB
(Upto
(Rs. 15
Rs. 15
Lakhs to
Lakhs)
1 Crore)
3.75
3.75
3.75
3.75
4.5
3.75
3.75
4.8
3.75
3.75
4.85
3.75
4.25
4.9
5.75
5.25
5.55
5.5
5.5
5.5
6.25
6.25
5.6
6.25
6.25
6.5
6.5
6.5
5.6
6.75
6.75
5.7
7.25
7.25
5.7
6.75
6.75
5.7
6.75
6.75
7.25
6.75
6.75
5.7
6.75
6.75
6.1
6.75
6.75
6.1
6.75
6.75
6.1
7.5
7.5
6.1
6.75
6.75
6.1
7.5
7.5
6.25
7.75
7.75
6.25
7.5
7.5
6.25
8
8
6.25
7.5
7.5
6.25
7.5
7.5
6.25
7.5
7.5
6.25
8
8
6.5
8
8
7
8
8
8
8
8
8
8
8
Table 4.1: comparative interest Rates

43

PNB

Canara

2.5
3
3
4
4
5.5
5.5
6.25
6.25
6.5
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.25
7.5
7.5
7.75
7.75
8
8

2.5
3.5
3.5
4
4
5.5
5.5
6
6
6
7
7
7
7
7
7
7.25
7
7
7
7.25
7.25
7.25
7.25
7.25
7.5
7.25
7.25
7.25
7.5
7.75
7.75
7.75

Short Term Investment (less than 1 year)

For investment less than 14 days

Only ICICI, PNB and Canara Bank are giving this option
Out of three, ICICI bank is giving highest rate of interest of 3.75%

For Investment between 14 to 90 days

In this Segment Standard Chartered id providing Highest Rate of interest
ranging from 4.5% to 4.9 %

For Investment between 90 days to 1 year

Standard chartered and ICICI are giving highest interest.
Highest interest in this segment is given by Standard Chartered for
investment made for 270 day giving interest of 6.5%

For short-term investment, Standard Chartered Bank is

recommended for investment in Fixed Deposits. It is
providing the highest rate of interest in this segment.

44

Medium Term Investment (1 to 2 years)

For Investment between 1 year to 400 days

Punjab National Bank is providing the interest of 7.25% for investments
made for 1 year to 400 days.

ICICI Bank is also giving interest rate of 7.25% for investments made for
390 days

For Investment between 400 days to 2 years

In this segment, ICICI , PNB and SBI are giving tough competition.
SBI and ICICI are providing highest rate of interest of 7.5% for 540 days
and 590 days respectively.

ICICI and SBI are favorites in this segment for

providing 7.5% of interest. However PNB can also be
considered, if investment period is less than 400 days.

45

Long Term Investment (2 years and above)

For Investment between 2 year to 3 days

Again Segment is ruled by SBI and ICICI by providing highest rate of
interest

ICICI is giving 8% of interest for investment made for 990 days.

SBI is giving 7.75% of

For Investment between 3 to 8 Year

ICICI is giving highest rate of interest of 8% for investment of 3 to 8 year
Standard Chartered does not provide Fixed Deposits for 5 year and above

For Investment 8 year and above

Both ICICI and PNB are providing Interest of 8% in this Segment.

ICICI is mostly recommended for Long Term

Investments as they are providing highest rate of
interest. However PNB can also be considered, if
investment period is between 8 to 10 years.

46

Comparative analysis
of
Term Deposit
or
Fixed Deposit
for
Senior Citizens

47

Table Showing Different Interest Rates by Banks

For Different Time Period
Time Period
Days/ Year
(upper
Limits)
7
14
29
45
60
90
120
180
210
270
1yr
389
390
391
399
400
540
555
556
590
591
2yr
790
791
990
991
1000
1001
3yr
4yr
5yr
8yr
9yr

SBI

4
4
4
4
5.5
5.5
6
6
6
7.5
7.5
7.5
7.5
7.5
8
8
7.75
7.75
7.75
8
8
8
8
8
8.25
7.75
7.75
7.75
8
8.25
8.25

ICICI
(Upto
Rs. 15
Lakhs)
4.25
4.25
4.25
4.25
4.75
6.25
6.25
6.75
6.75
7
7.25
7.75
7.25
7.25
7.25
7.25
7.25
7.25
8
7.25
8
8.2
8
8.5
8
8
8
8.5
8.5
8.5
8.5
8.5

ICICI
(Rs. 15
Lakhs to
1 Crore)
4.25
4.25
4.25
4.25
4.75
5.75
6
6.75
6.75
7
7.25
7.75
7.25
7.25
7.25
7.25
7.25
7.25
8
7.25
8
8.25
8
8.5
8
8
8
8.5
8.5
8.5
8.5
8.5
48

SCB

PNB

Canara

4.5
4.8
4.85
4.9
5.55
5.5
5.6
7
5.6
5.7
5.7
5.7
7.5
5.7
6.1
6.1
6.1
6.1
6.1
6.25
6.25
6.25
6.25
6.25
6.25
6.25
6.5
7
-

3
3.5
3.5
4.5
4.5
6
6
6.75
6.75
7
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
7.75
8
8
8.25
8.25
8.5

3
4
4
5
5
6
6
7
7
7
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
8
9
9

10yr

8.25
8.5
8.5
8.5
Table 4.2 : comparative interest Rates (senior Citizen)

Short Term Investment (less than 1 year)

For investment less than 14 days

Standard Chartered and SBI dont provide fixed deposits for less than 14
days
ICICI bank is giving highest rate of interest of 4.25%

For Investment between 14 to 90 days

Highest interest is given by Canara bank at rate of 5% for 60 to 90 days
Standard chartered also provides competitive interest rates for 15 to 59
days

For Investment between 90 days to 1 year

Again Canara Bank is giving highest rate of interest of 7% for investment
made for 210 days to 1 year.

Standard Chartered also Provide same 7 % interest for invest made for
270 days to 1 year.

For short-term investment, Canara bank is best choice

for senior Citizens. However in some cases Standard
Chartered can also be considered.

49

Medium Term Investment (1 to 2 years)

For Investment between 1 year to 400 days

Canara Bank is consistently providing highest rate of interest in this
segment.

Rate of interest provided by canara bank is 8%

For Investment between 400 days to 2 years

Again Canara bank is providing highest rate of 8%.
SBI and ICICI are also giving same rate of interest (8%) for invest made
for 540 days and 590 days respectively.

Canara Bank is providing highest rate of interest of 8%

throughout the segment for senior citizens. It is the best
choice of the segment.

50

Long Term Investment (2 years and Above)

For Investment between 2 year to 3 days

Highest rate of interest is provided by ICICI bank for investment made for
990 days, 8.5% interest rate.

Also SBI and Canara bank is providing maximum 8% interest in most of

segment.

For Investment between 3 to 8 Year

Here ICICI is providing maximum interest of 8.5% throughout the
segment.

For Investment 8 year and above

Canara Bank is providing interest rate of 9% throughout the segment
which is highest.

ICICI and Canara Bank is Recommended for their

respective time period where they are providing high
interest rates to senior citizens.
51

CHAPTER 5

Conclusion
52

Conclusion

For General Public

Standard Chartered Bank is recommended for
investment in Fixed Deposits made for Less than 1
Year
SBI and ICICI Bank are providing best rate of best
rate of interest for invest made for 1 to 2 years
ICICI Bank is best for invest made for 3 year and
above.

For Senior Citizen

Canara Bank is most suitable bank to invest in
Fixed Deposits for Senior Citizens, it is providing
highest rate of interest throughout the section

53

 ICICI bank can also be considered if invest is made

for more than 3 years

CHAPTER 6
Suggestions
Or
Recommendations

54

Suggestions
Interest accrued on fixed deposits is taxed while money market
mutual funds are tax-exempt. If you are in the low tax bracket,
FD is a good investment option. But if you are one who falls
under the high tax bracket, investment in mutual fund short-term
debt fund or liquid or cash funds will fetch you good returns.
Instead of putting a big amount in one fixed deposit, break it into
more than one fixed deposits of small amounts so if in future
you require liquidity you can breaks a small deposit and save
interest and charges on cancellation of your fixed deposit.
Before putting your money in fixed deposits, check the financial
position of the bank. Bank offer different rate of interest choose
which suits you best.

55

CHAPTER 7

Limitations
of the Study
56

LIMITATIONS
Although the project has been worked out at its best yet there are
some limitations, which cannot be overlooked. Had these limitations
been overcome, the findings would be accurate.

Some of the limitations are:

2) Data constraint:
All the data that has been collected for this project, has been taken
from secondary sources like websites, magazines, newspapers and
book.

1) Time constraint:
Time was really a limiting factoring the project. Its really difficult to
work out such a large project between two months time.

57

BIBLIOGAPHY
WEBSITES

www.canarabank.com
www.icicibank.com
www.paisawaisa.com
www.pnbindia.in
www.rupeetimes.com
www.standardchartered.co.in
www.statebankofindia.com
www.Wikipedia.com

58