Dr A.P.J.

ABDUL KALAM TECHNICAL

UNIVERSITY LUCKNOW

A
Project Report
On
Innovation Idea for Product & Services
TOPIC:- BANKING SECTOR

UTTAM GROUP OF INSTITUTIONS

Submitted By:- KM RENU

MBA 1st Sem.

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Contents

S.no Topic Page no

1 Certificate

2 Acknowledgement

3 List of Tables

4 List of Abbreviations

5 Chapter -1 Profile of the PSB

 About PSB

 History of PSB

 Introduction of PSB

 Vision and mission of PSB

 Sources of Data Collection

6 Chapter -2 SWOT Analysis of PSB

 Strengths and Weaknesses of PSB

 Opportunities and Threats that PSB Faces

 Fair Best Practices/ USP

7 Chapter -3 Conceptual Framework

 Common area of customer banker Relationships

 Safe deposit lockers

 Deposit Schemes

 Various FD schemes of the bank

 RTGS ( Real Time Gross Settlement)

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Acknowledgement
I am using this opportunity to express my gratitude to everyone who supported me
throughout the course of this MBA project. I am thankful for their aspiring
guidance, invaluably constructive criticism and friendy advice during the project
work. I am sincerely grateful to them for sharing their truthful and illuminating
views on a number of issues related to the project.

I express my warm thanks to for their support and guidance.

I would also like to thank my project external guide and all the people who
provided me with the facilities being required and conductive conditions for my
MBA project.

Thank you,

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List of Tables

Table no. Title Page no.

1. Saving Bank Account

2. Current Account

3. Term Deposit Account

4. Rate of interest

5. Service Charges of RTGS

6. Service Charges of NEFT

List of Abbreviations

S. no. Abbreviated Name Full Name

1. PSB Punjab & Sind Bank

2. SB Saving Bank account

3. CA Current account

4. RBI Reserve Bank of India

5. RTGS Real Time Gross Settlement

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 Profile of Punjab & Sind Bank

About the PSB

 Punjab and Sind Bank (A Govt. Of India Undertaking), 24 west Patel

Nagar, New Delhi-28

 Telephone no.: 011-25768831, 25738372

 email: cmd@PSB.co.in

 Website: www.PSBindia.com.

History of the PSB

It was in the year 1908, when a humble idea to uplift the poorest of poor of the

land culminated in the birth of Punjab & Sind Bank with the far-sighted vision of

luminaries like Bhai Vir Singh, Sir Sunder Singh Majitha and Sardar Tarlochan

Singh. They enjoyed the highest respect with the people of Punjab.

The bank was founded on the principle of social commitment to help the weaker

section of the society in their economic endeavours to raise their standard of life.

Decades have gone by, even today Punjab & Sind Bank stands committed to

honor the social commitments of the founding fathers.

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 Introduction

PSB is a Government Bank of India undertaking. This bank is nationalized on

15th April, 1980. This provides banking services to their customers like loan,

lockers and other facilities. This organization performs all financial activities. This

operates the Banking and Finance sector. The bank was founded on the principle

of social commitment to help the weaker section of the society in their

economic endeavors to raise their standard of life and to strive to achieve

excellence in Customer Service.

 Segment of PSB: Individual and industrial banking in Punjab

 Target group: All age and earning groups.

 Positioning: Complete banking solutions.

Vision &

Mission of

PSB

Corporate

Vision

PSB envisions emerging as a strong vibrant Bank through synchronization of

the human, financial and technological resources.

Corporate Mission

 To put in place the effective Risk Management and Internal Control

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  To achieve the highest standards of transparency and accountability in

the conduct of banking business.

 To adopt professional approach in effectively managing financial as

well as non-financial risks.

 To maximize profitability and profits of the Bank with due compliance of

prudential guidelines.

 To maximize competitive risk adjusted return on capital, through

planned reduction in the average cost of funds, increased yield on

advances and investments besides reduction in cost of operations.

Product Range of Bank

The product range of the bank or services provided by the bank are:

1. Saving bank account

2. Current account

3. Term deposit account

4. Safe deposit lockers

5. Deposit schemes: Saving bank (SB), Recurring deposit (RD), Fixed

deposit (FD)

6. RTGS

7. NEFT

8. Credit cards, Debit cards, Smart cards, Gift cards

9. Loans and Advances

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 Source of Data Collection:

The basic objective of the project is to study the patterns of respondents. Both

primary and secondary data will be used in order to analyze the aspect.

A project methodology tells us what we have to do, to manage our projects from

start to finish. It describes every step in the project life cycle in depth, so we know

exactly which tasks to complete, when and how. Whether we are an expert or a

novice, it helps us to complete tasks faster than before.

In Primary data collection, we collect the data our self using methods such as

interviews and questionnaires. The key point here is that the data we collect is

unique to us and our research and, until we publish, no one else has access to it.

Secondary data is data taken by the researcher from secondary sources, internal

or external. The researcher must thoroughly search secondary data sources

before commissioning any efforts for collecting primary data. Secondary data is

of two kinds, internal and external. Secondary data – whether internal or external

– is data already collected by others, for purposes other than the solution of the

problem on hand.

Secondary data is data which has been collected by individuals or agencies for

purposes other than those of our particular research study.

No marketing research study should be undertaken without a prior search of

secondary sources (also termed desk research). There are several grounds for

making such a bold statement.

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  Secondary data may be available which is entirely appropriate and wholly

adequate to draw conclusions and answer the question or solve the

problem. Sometimes primary data collection simply is not necessary.

 It is far cheaper to collect secondary data than to obtain primary data. For

the same level of research budget a thorough examination of secondary

sources can yield a great deal more information than can be had through

a primary data collection exercise.

 The time involved in searching secondary sources is much less than that

needed to complete primary data collection.

 Secondary sources of information can yield more accurate data than that

obtained through primary research. This is not always true but where a

government or international agency has undertaken a large scale survey,

or even a census, this is likely to yield far more accurate results than

custom designed and executed surveys when these are based on

relatively small sample sizes.

 It should not be forgotten that secondary data can play a substantial role

in the exploratory phase of the research when the task at hand is to define

the research problem and to generate hypotheses. The assembly and

analysis of secondary data almost invariably improves the researcher's

understanding of the marketing problem, the various lines of inquiry that

could or should be followed and the alternative courses of action which

might be pursued.

 Secondary sources help define the population. Secondary data can be

extremely useful both in defining the population and in structuring the

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Analysis

SWOT analysis of Punjab and Sind Bank:

Strengths and weaknesses of PSB

Strengths:

1. Schemes for rural sector.

2. Tie-ups with Auto sector firms like TATA Motors and Maruti.

3. Active in various Government schemes facilitation.

4. Have around 1000 branches across India and 400 branches in India.

Weaknesses:

1. Less penetration in the urban areas

2. Inadequate advertising and branding as compared to other banks

Opportunities and Threats that the Bank faces:

Opportunities

1. Small scale business banking across India.

2. Expansion in other countries for international banking.

3. Installation of more ATM‟s and better customer‟s services.

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 Fair Banking Practices

We request you as our customers to please note the following duties to

enable us to serve you better.

 Ensure safe custody of cheque book and pass book.

 Preferably use reverse carbon while writing a cheque.

 Issue crossed/account payee cheques as far as possible.

 Check the details of the cheque, namely, date, amount in words and

figures, crossing, etc., before issuing it. As far as possible, issue

cheques are rounding off the amount to nearest rupee.

 Not to issue cheque without adequate balance, maintain minimum

balance as specified by the Bank.

 Send cheques and other financial instruments by Registered Post or

by courier.

 Bring pass book while withdrawing cash from Saving Bank

account through withdrawal slip. Get pass book updated from time

to time.

 Use nomination facility in all deposits accounts & locker facility.

 Note down account numbers, details of FDR, locker numbers,

etc., separately.

 Inform change of address, telephone number etc., to the Branch.

 Inform loss of demand draft, fixed deposit receipt, cheque leave(s)

/book, key of locker, etc., immediately to the Branch.

 Avail standing instructions facility to repeat transactions.

 Provide feedback on our service.

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  Pay interest, installments, locker rent and other dues on time.

 Avail services such as ATM, EFT, etc., if offered by the branch.

 Bring any deficiency in services to the notice of the Branch Manager.

 Not to sign blank cheque(s). So also do not record your

specimen signature either on pass book or on cheque book.

 Not to introduce any person, who is not personally known to you for the

purpose of opening account.

 Not to bribe any staff member, to avail corruption free service.

USP: Commitment to help the weaker section of the society.

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 Safe Deposit Lockers:

The facility of Safe Deposit Lockers is an ancillary service offered by our

Bank. The Branches offering this facility will indicate/display this information

at a prominent place.

The major aspects governing the services are :

 A locker may be hired by an individual (not minor) firms, limited

companies, specified associations and societies etc. except blind

persons.

 Nomination facility is available to individual hirer of Safe Deposit locker.

 Loss of key should be immediately informed to the Branch and

customer will be charged for break-opening of the Locker. Lockers are

available in different sizes.

 Lockers are rented out for a minimum period of one year as per

bank's policy. In case of overdue rent, the Bank will charge penalty

as decided from time to time.

 With standing instruction, the rent may be paid from the deposit

account of the hirer.

 We will issue locker only to properly introduced persons.

 We reserve our right to break open the locker if the rent is not

paid inspite of giving notices as per the Bank rules and recover charges

thereof.

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 Deposit Schemes:

1. Saving Bank

A. Saral Savings Scheme

Under the RBI direction to achieve greater financial inclusion Bank has since

introduced a no frill deposit account named as "SARAL SAVINGS

SCHEME", that would make accessible banking to vast section of society,

which has been deprived of the banking facilities till date. Basic feature of

the account shall be as under :-

1. Such accounts shall remain operative even when these have

Zero balance & can be opened in any branch of the bank

"Saral Savings Account" can be opened with the initial deposit of Rs100/- and

thereafter the balance may go below Rs 100/- and will continue to be

operative with even zero balance, unless the account holder request to

close the account. No charges shall be levied in this regard.

2. Target Customers

 Landless labour / Artisans in the rural areas / House wives not

having regular income.

 Casual labour / Daily wage earners in construction / Industries etc.

earning small amount daily.

 Students having no sound financial background, having no resources

and least chances of the saving opportunities.

 Similar other segments of society who do not have regular

employment and permanent residential occupancy.

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  These accounts shall come under the category of the normal saving

bank account, once the balance is enough to qualify under KYC norms.

 This product is not for Non Resident Indians, Trusts, Societies etc.

 The account can be opened by filling up of usual Saving Bank Accounts

Opening forms and self verified photograph to be attached.

3. Introduction of the account.

An account holder qualifying KYC norms whose account is at least

six month old with satisfactory operations may introduce the

account.

Or

Any other evidence as to the identity and address of the customer to the

satisfaction of branch incharge.

4. Operational Stipulation:

 Cheque Book will not be issued to this account holder, however on

requisition loose cheque may be issued . Manager cheque / Demand

Draft / MT may be issued on request of the account holder after

satisfaction that transaction is genuine but each instrument not to

exceed Rs 3000/-. Usual bank charges to be levied for issue of these

instruments.

 Number of withdrawals permitted -- 'FIVE' in a month and 'TWENTY'

per half year.

 For each transaction account holder has to come personally to

the branch.

 Persons above the age of 15 and below 18, who is able to read and

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 person / guardian. In such account guidelines shall be same as

applicable on savings bank account. Interest is payable at the rate

applicable as per

saving bank account. However no interest is payable until the

balance in the account is Rs 500/-.

 Credit balance in account is not expected to exceed Rs 50000/- OR

the total credits are not expected to exceed Rs100000 /- in a year , if

KYC norms not complied with. No further transaction will be permitted till

compliance of KYC norms if at any point in all his accounts balance

exceeds Rs 50000/- ( Fifty Thousand) or total credits in the account

exceeds Rs 100000/-(One Lac) no further transaction will be

permitted till compliance of KYC norms .

 No Collection of cheque is permitted in these accounts. However, if

any cheque is brought for collection then customer is to satisfy KYC

norms. Normally transfer and clearing is not allowed.

Exception

 However, if Branch Manager is fully satisfied, such collection /

transfers may be allowed up to Rs 3000/- per instrument but not

more than six such transactions in a year.

 In such cases Branch Manager has to certify having satisfied

himself about the genuiness of the transaction before allowing such

transaction.

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 Saving Bank account

Such accounts can be opened by Individuals (singly or jointly), Associations,

clubs, educational institutions.

Minimum Balance in Account

I) Where cheque Book is not issued Rs . 500/-

Computerized
Branches II) Where cheque Book is issued Rs. 1000/-

Non Computerized I) Where cheque Book is not issued Rs. 250/-

Branches II) Where cheque Book is issued Rs. 500/-

I) Account with or without cheque Book facility Rs.

Rural Branches
100/-

Maximum balance + Any Amount can be deposited.

Rate of Interest / Eligibility for payment of interest:

Table no.3:
Rate of Payment
Interest schedule

3.5% or such rate as prescribed Payable on half yearly rest on Daily

by the RBI from time to time. product basis from 1st April 2010

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 2. Recurring Deposit Schemes

Who can open an account:

 An individual who is not insolvent or insane, can open an account

singly or jointly.

 A minor can open Saving bank Account and the same can be

operated by the natural guardian or by minor himself / herself, if he /

she is above the age of 10 years. The account can also be opened

jointly.

 On attaining majority, the erstwhile minor should confirm the

balance in his / her account and if the account is operated by the natural

guardian / guardian, fresh specimen signature of erstwhile minor duly

verified by the natural guardian / guardian would be obtained and kept

on record for all operational purpose.

 Such accounts can be opened by Individuals (singly or jointly), a firm,

company, club, Association, Institution, Govt. or Semi Govt. Body, Co-

operative societies, religious and charitable institutions etc.

Minimum deposit in the Account - Minimum of Rs. 10/-

Maximum deposit in the Account - Maximum of any amount per month.

Minimum and Maximum tenure

Minimum tenure - Minimum period six months.

Maximum tenure - Maximum 10 years.

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 Rate of Interest

 As per rate applicable to fixed Deposit for the respective maturity period.

Periodicity of Interest

 The interest is compounded at quarterly intervals but paid along

with principal at the time of maturity of deposit.

3. Fixed Deposit Scheme

Who can open an account:

 An individual who is not insolvent or insane, can open an account

singly or jointly.

 A minor can open Saving bank Account and the same can be

operated by the natural guardian or by minor himself / herself, if he /

she is above the age of 10 years. The account can also be opened

jointly.

 On attaining majority, the erstwhile minor should confirm the balance

in his / her account and if the account Is operated by the natural

guardian / guardian, fresh specimen signature of erstwhile minor duly

verified by the natural guardian / guardian would be obtained and kept

on record for all operational purpose.

 Such account can be opened in the name of individuals (singly or jointly,

Minors (through their guardians) firms, corporate bodies, trusts, Regd.

Associations, Joint Hindu family firms and public undertakings.

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  Nomination facility is available for depositors

Senior Citizens

The Senior Citizes shall be given an addiotional rate of 0.50% on

any amount over and above the mentioned rates for deposits with

maturity period 91 days & above for fresh and renewed deposits.

Staff / Ex-staff members

Ex -staff Members are eligible for 1 % extra rate of interest,

however, please note that if the Ex-Staff Member is also a Senior

Citizen, he will also be eligible for additional interest applicable to

Senior Citizen shown as above.

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 Various Fixed Deposit Schemes of the Bank

1) Fixed Deposit Scheme Ordinary

Under this scheme any sum can be placed for any fixed period ranging from

15 days to 120 months and the interest accrued can be withdrawn at the

quarterly intervals.

Minimum period of 7 days also permissible ( conditions apply ).

2) Saving with Smile Deposit Scheme

 It is a reinvestment plan deposit scheme, under which compound interest

is paid.

 The interest is compounded at quarterly intervals but paid along

with principal at the time of maturity of deposit.

 Any amount of deposit shall be accepted under this scheme for a

minimum period of 36 months and a maximum period of 120 months.

3) Short Term Deposit Scheme

 It is a reinvestment deposit scheme under which the depositor can

place the funds for short period and still can reap the benefits of

compound interest.

 Any amount of deposit shall be accepted under this scheme for a

minimum period of 6 months and a maximum period of 36 months

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 4) Capital Gain Deposit Scheme

This is a scheme under which the tax payers can avail of benefits of exemption

from Capital gains, only if the amount of Capital gains or the net consideration is

deposited in Public Sector Banks on or before their due date of filling the income

tax return. (Subject to conditions as contained in relevant provisions of I.Tax Act

1961,) as amended from time to time.

5) Harhi Savni (Rabi Kharif) Jama Yojna

 Harhi savni (Rabi Kharif) Jama Yojna is a unique scheme offered by

Punjab & Sind Bank to its farmer friends.

 The scheme is specially designed to help the farmers to invest their

surplus funds at the time of each harvesting.

 The scheme also provides flexibility in depositing the installments with

minimum of Rs.1000/-- and in multiples thereof to any amount.

 The deposit of installments is correlated with the harvesting of Hari (Rabi)

/ Savni Kharif) crops and is required to be deposited each year before

30th June and 31st December every year.

6) PSB Fixed Deposit tax Saver Scheme

Bank has formulated Fixed Deposit Scheme for Tax Saving under Section 80 C

(2) of the Income Tax Act, 1961.

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 Real Time Gross Settlement (RTGS)

Service charges for RTGS

(i) Outward Remittance :

Table no.5:

Rs. 1 lac to Rs. 2 lakh ---

Above Rs.2 lac to 5 lacs Rs. 25/- Per Transaction

Above Rs.5 lacs Rs. 50/- Per Transaction

(ii) Inward Remittance: NIL

National Electronic Funds Transfer (NEFT)

 RBI has introduced this funds transfer systems called RBI-NEFT System.

This is an Inter-bank electronic funds transfer system to facilitate an

efficient, secure, economical, reliable and expeditious transfer of funds

and clearing in the Banking sector in India. The account holders with the

branch can use the NEFT facility which is available between all the Cities

and the designated branches of Banks in India.

NEFT settlement takes place 11 times a day during the week days (9.00

am, 10.00 am, 11.00 am, 12.00 noon. 1.00 pm, 2.00 pm, 3.00 pm and

4.00 pm, 5.00 pm,

6.00 pm, 7.00 pm) and 5 times during Saturdays (9.00 am, 10.00 am, 11.00 am,

12.00 noon and 1.00 pm)

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  No Minimum or Maximum amount stipulation for NEFT transactions

 At present this facility is available at the following branches whose

IFSC codes are also mentioned alongside.

Service charges for NEFT

(i) Outward Remittance :

Table no.6:

Up to Rs 1 Lac Rs. 5/- Per Transaction

Above Rs. 1 lac to Rs.2lac Rs. 15/- Per Transaction

Rs.25/-
Above Rs 2.00 Lac
(Service tax & Education Cess extra)

(ii) Inward Remittance: NIL

Know Your Customer (KYC)

Know Your Customer (KYC) is the due diligence and bank regulation that

financial institutions and other regulated companies must perform to identify

their clients and ascertain relevant information pertinent to doing financial

business with them. In the USA, KYC is typically a policy implemented to

conform to a customer identification program mandated under the Bank

Secrecy Act and USA PATRIOT Act. Know your customer policies are

becoming increasingly important globally to prevent identity theft fraud,

money laundering and terrorist financing.

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Introduction
As per the Reserve Bank of India (RBI), India’s banking sector is sufficiently capitalised and well-
regulated. The financial and economic conditions in the country are far superior to any other
country in the world. Credit, market and liquidity risk studies suggest that Indian banks are
generally resilient and have withstood the global downturn well.
Indian banking industry has recently witnessed the roll out of innovative banking models like
payments and small finance banks. RBI’s new measures may go a long way in helping the
restructuring of the domestic banking industry.
The digital payments system in India has evolved the most among 25 countries with India’s
Immediate Payment Service (IMPS) being the only system at level five in the Faster Payments
Innovation Index (FPII). *
Market Size
The Indian banking system consists of 12 public sector banks, 22 private sector banks, 46 foreign
banks, 56 regional rural banks, 1485 urban cooperative banks and 96,000 rural cooperative banks in
addition to cooperative credit institutions. As of September 2020, the total number of ATMs in
India increased to 210,049 and is further expected to increase to 407,000 by 2021.
Asset of public sector banks stood at Rs. 107.83 lakh crore (US$ 1.52 trillion) in FY20.
During FY16-FY20, bank credit grew at a CAGR of 3.57%. As of FY20, total credit extended
surged to US$ 1,698.97 billion.
During FY16-FY20, deposits grew at a CAGR of 13.93% and reached US$ 1.93 trillion by FY20.
Credit to non-food industries stood at Rs. 103.46 trillion (US$ 1.40 trillion) as of November 20,
2020.

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 CONCLUSION
The Indian banking industry plays an important role in the economic development of the country
and is the most dominant segment of the financial sector. Banks help channel savings to
investments and encourage economic growth by allocating savings to investments that have
potential to yield higher returns.
Banking sector in Indian has given a positive and encouraging responses to the
financial sector reforms. Entry of new private banks and shaken up Public sector banks to
competition. The financial sector reforms have brought India financial system closer to global
standards
The Indian banking industry plays an important role in the economic development of the country
and is the most dominant segment of the financial sector. Banks help channel savings to
investments and encourage economic growth by allocating savings to investments that have
potential to yield higher returns.

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