Mini Project – On Rural Based Company

“MAGYAR BANK”
by
Shrinath Gidde
2019-2409-0001-0004
MBA- MARKETING 01
under the guidance of
Mrs. Chetna Mam
 Acknowledgment

I take this opportunity to express my deep sense of gratitude to all those have
contributed significantly by sharing their knowledge and experiences in the completion
of this project work. I am greatly obliged to several people for providing me with the right
kind of opportunity and facility to complete this project.

I am extremely thankful to Mrs. Chetna mam- my internal faculty guide under whose
guideless this project work was carried out.

SHRINATH GIDDE

Sign
 DECLARATION

I SHRINATH GIDDE hereby declare that the Project Report entitled “MINI
PROJECT ON RURAL BASED COMPANY “MAGYAR BANK” is done by
me under the guidance of Mrs. CHETNA MAM Lecturer, PUNE INSTITUTE
OF BUSINESS MANAGEMENT, PUNE, MAH is submitted in partial
fulfillment of the requirements for the award of the degree in MANAGEMENT OF
BUSINESS ADMINISTRATION.

DATE:

PLACE SIGNATURE OF THE CANDIDATE

Contents
Marketing Environment analysis of MAGYAR BANK..............................................................................6
Political Factors that Impact Managing Change at Magyar Bank....................................................6
Economic Factors that Impact Managing Change at Magyar Bank.................................................7
Social Factors that Impact- Managing Change at Magyar Bank......................................................8
Technological Factors that Impact Managing Change at Magyar Bank..........................................9
Environmental Factors that Impact Managing Change at Magyar Bank.......................................10
Legal Factors that Impact Managing Change at Magyar Bank......................................................11
Consumer behavior towards product of MAGYAR BANK......................................................................12
STP PF MAGYAR BANK...............................................................................................................................18
Marketing mix of MAGYAR BANK..............................................................................................................19
Marketing Environment analysis of MAGYAR BANK

PESTLE ANALYSIS OF MAGYAR BANK

Political Factors that Impact Managing Change at Magyar Bank

Size of Government Budgets – both Local Governments and National Government – The
government at both national level and local levels are running deficit budgets which is boosting
growth in the short term but may lead to increase in inflation over medium term. The bond rating
of national government is investment grade.

- Political Governance System – Based on the information provided in the Managing Change at
Magyar Bank (A) case study, it seems that the country have a stable political system. Magyar
Bank can make strategies based on the stable political environment.

- Unrest within the Country & Chances of Civil Unrest – We don’t think that Magyar Bank
business operations are facing any dangers from any kind of civil unrest or internal militant
operations in the country.

- Likelihood of Entering into an Armed Conflict – From the information in the Managing
Change at Magyar Bank (A) case study, I don’t think there is a likelihood of country entering
into an armed conflict with a neighboring country.

- Role of Non-Government Organization, Civil Society & Protest Groups – The country has a
vibrant civil society community and Magyar Bank should build bridges with them and seek out
areas of co-operations. Civil society groups are influential not only in policy making but also in
building a society wide narrative.

- Transition of Government and Changes in Policy – There is consistency in policy making from
one government to another. Secondly governments from all parties adhere to the treaties made by
the previous governments.
- Democracy & Other Democratic Institutions – According to Paul M. Healy, Rachna Tahilyani
the democratic institutions are needed to be strengthened further so that business such as Magyar
Bank can thrive in an open, transparent and stable political environment. Strengthening of
democratic institution will foster greater transparency and reduce the level of corruption in the
country.

- Regulatory Practices - The regulatory practices are streamlined with global norms which have
helped the country to improve its “ease of doing business” ranking.

Economic Factors that Impact Managing Change at Magyar Bank

Work Force Productivity – Work force productivity in US has grown by 25-30 % in last two
decades even though the salaries are not reflecting those gains. It can enable Magyar Bank to
hire skilled workforce at competitive salaries.

- Foreign Exchange Rate – Number of companies have incurred losses in past few years because
of forex risk in – Venezuela, Brazil, and Argentina. Magyar Bank should be careful about the
history of forex risk before entering new market. Many US companies have incurred losses in
Mexico in regular forex crisis in that country.

- Consumer Disposable Income – The household income of the country has increased constantly
in the last decade and half, compare to the USA market where household income is still below
2007 levels and not increased in real terms since early 1980’s. Magyar Bank can leverage this
trend to expand the market beyond its traditional customers by employing a differentiated
marketing campaign.

- Price Fluctuations in both Local and International Markets – Compare to the level of
quantitative easing in last decade the prices of Magyar Bank products and prices of overall
products have remained sticky in the US market. Magyar Bank should consider the fact that at
deficit levels of United States in an emerging economy can lead to rampant inflation and serious
risks of currency depreciation.
- Inequality Index / Ranking on Gini Index – Gini Index and level of inequality are a great
barometer for harmony and development of a society. If there is huge income inequality in the
society then the likelihood of conflict and crime increases. It can lead to uncertainty and
suppression of consumption in both short term and long term.

- Level of Household Income and Savings Rate – Increasing consumption and stagnant
household income in United States had led to credit binge consumption. It has decimated the
culture of savings as people don’t have enough to save. Magyar Bank needs to be careful about
building marketing strategy that is dependent on “Purchase on Credit” consumer behavior.

- Demand Shifts from Goods Economy to Service Economy – The share of services in the
economy is constantly increasing compare to the share of manufacturing, goods, and agriculture
sector.

Social Factors that Impact- Managing Change at Magyar Bank

Societal Norms and Hierarchy – What sort of hierarchy and norms are acceptable in society also
influence the types and level of consumption in a society. In highly hierarchical societies the
power of decision making often reside at the top

- Attitude towards Health & Safety – The attitude towards health and safety is often reflected in
the quality of the products and cost structures of manufacturing processes. Magyar Bank has
stringent norms for health and safety norms so in emerging economies it may have to compete
with players who don’t have high cost structures that of Magyar Bank.

- Level of Social Concerns & Awareness in Society – Higher level of social concerns in the
society often result higher consumer activism and pressure from non-governmental
organizations, & pressure groups.

- Attitude towards Leisure – Magyar Bank should conduct an ethnographic research to

understand both attitude towards leisure activities and choice of leisure activities. Experience
economy is one of the fastest growing segments both among millennials and among baby-
boomers.
- Education Level in Society – Education level of the society impacts both the quality of jobs and
level of income. High level of education often results in better jobs, higher income and higher
spending on complex and aspirational products.

- Demographic Trend – The demographic trend is one of the key factors in demand forecasting
of an economy. For example as the population of USA and EU is growing old the demand for
products mostly catering to this segment will grow. Magyar Bank should consider demographic
trends before new product developments and integrate features that cater to this segment. As
population is ageing it will require less tech intensive products.

- Types of Immigration & Attitude towards Immigrants – Given the latest developments such as
Brexit and Immigrant detention on Southern border of United States. Attitude towards
immigration has come under sharp focus. Magyar Bank should have capabilities to navigate
under this hyper sensitive environment.

- Nature of Social Contract between Government & Society – Before entering into a market
Magyar Bank needs to understand the nature of social contract between government and society.
For example it has been extremely difficult for US companies to enter UK health market as UK
health system is a nationalized system and everything goes through contracts at national level

Technological Factors that Impact Managing Change at Magyar Bank

Intellectual Property Rights and Patents Protection – Before entering new market Magyar Bank
should focus on the environment for intellectual property rights.

- Technology transfer and licensing issues for Magyar Bank – laws and culture of licensing of
IPR and other digital assets should be analyzed carefully so that Magyar Bank can avoid
shakedowns and IPR thefts.

- Research and Development Investment Levels – If there is high level of investment in

technology development sector then there are high chances of building a self sustaining
ecosystem that drives innovation. Magyar Bank can leverage such a situation to hire the best
people in business.
- Preparedness for 5G Related Infrastructure – Countries across the world are trying to prepare
themselves to install 5G infrastructure. Magyar Bank should assess to what level the local market
is prepared to roll out the 5G connectivity.

- Cost of Production and Trends – Magyar Bank should assess - What are the cost of production
trends in the economy and level of automatization. We at EMBA Pro believe that in near future
the sector most disrupted by technological innovation is manufacturing and production.

- Transparency & Digital Drive – Magyar Bank can use digitalization of various processes to
overcome corruption in the local economy.

- E-Commerce & Related Infrastructure Development – As E-Commerce is critical for Magyar

Bank business model. It should evaluate the e-commerce infrastructure, technology infrastructure
etc before entering a new market.

- Level of Acceptance of Technology in the Society – Magyar Bank has to figure out the level of
technology acceptance in the society before launching new products. Often companies enter the
arena without requisite infrastructure to support the technology oriented model.

Environmental Factors that Impact Managing Change at Magyar Bank

Environmental Regulation Impacting Absolute Cost Advantage Dynamics in the Industry.

- Environmental Standards and Regulations both at National & Local Levels – Often the
environment policy at national and local level can be different. This can help Magyar Bank in
numerous decisions such as plant location, product development, and pricing strategy.

- Per Capita and National Carbon Emission – What is the per capita carbon emission of the
country and what is the overall level of carbon emissions of the country. This will help in better
predicting the environment policy of the country.
- Focus & Spending on Renewable Technologies – How much of the budget is spend on
renewable energy sources and how Magyar Bank can make this investment as part of its
competitive strategy.

- Influence of Climate Change – How climate change will impact Magyar Bank business model
and supply chain. For example if the supply chain is not flexible it can lead to bottlenecks if
shipments from one part of the world are delayed because of sudden climate shift.

- Level of Consumer Activism Regarding Environmental Concerns – Magyar Bank needs to

know the level of consumer activism regarding environmental concerns is. It will help Magyar
Bank in both developing environmentally friendly products and thwarting PR stumble blocks.

- Paris Climate Agreement and Commitment of National Government under the Agreement –
What are the commitments of the country under the Paris Agreement and what is the general
level of consensus regarding Paris Climate Agreement in the country. For example Trump not
standing by US commitments created an environment of uncertainty.

Legal Factors that Impact Managing Change at Magyar Bank 

Securities Law – What are the securities law in the country and what are the conditions to list the
company on national or regional stock exchange.

- Independence of Judiciary and Relative Influence of Government – The judiciary independence

often reflect both strength and credibility of the institutions in the country.

- Data Protection Laws – Magyar Bank needs to assess what are the data laws in the country and
what it needs to do to comply with them. For example most of EU countries now want the EU
citizen data to be saved in EU countries only.

- Business Laws – Before entering into new market – Magyar Bank has to assess what are the
business laws and how they are different from home market.
- Intellectual Property Rights Protection – Magyar Bank should assess the level of protection that
intellectual property rights get under the legal system of the country.

- Health & Safety Laws – What are the health and safety laws in the country and what Magyar
Bank needs to do to comply with them. Different countries have different attitude towards health
and safety so it is better for Magyar Bank to conduct a thorough research before entering the
market.

- Time Taken for Court Proceedings – Even if the country has best of the laws, it doesn’t mean
much if they can’t be enforced in a timely manner. Magyar Bank should do a primary research
regarding how much time it often takes to conclude a court case in the country given the sort of
legal challenges Magyar Bank can face.

Consumer behavior towards product of MAGYAR BANK

BANKING ACCOUNTS

Easy Access Savings Account

Banking made easy

Want a savings account that transcends geographical boundaries? Presenting, Magyar Bank's
Easy Access Savings Account. The account is an endeavor by the Bank to understand the
consumers' needs and redefine banking to suit your requirements for a truly comfortable banking
experience. Easy Access Savings Account gives you instant access to your money anywhere,
anytime. Possessing a range of unmatched features, it has been devised to better suit the
convenience of our eclectic client base.

Krishi Savings Account

Kheti Ho Khushhali Ki
Magyar Bank offers a unique savings account which is easy to operate and allows you totransact
immediately. This product has been specially designed keeping in mind the unique requirements
of a farmer and true to its nature has been called the Krishi Savings Account.

Some of the features of our new product are:

Average Balance Requirement This account is offered with the requirement of maintaining the
half-yearly average balance of Rs 1000only.International Master Debit Card The Krishi Savings
Account entitles you to an International Master Debit Card with which you can access your
account anytime through the Magyar Bank ATM network free of cost.

This card comes with:

 A cash withdrawal limit of Rs 25,000 per day

 Free Accident Insurance cover of Rs 2 lacs

Corporate Salary Account

Our Corporate Salary Power Offering is designed to offer payroll solutions through in a 24 X 7
environment.

We leverage on our extensive network of distribution channels spread across 586 centers through
a network of more than 1000 branches and 4055 ATMs (as on 31stMarch, 2010) besides our
superior service delivery model and product features, as a strong differentiator, to provide value
to the end user.

Benefit to Employees
 No minimum balance criteria.
 Unparalleled Access - Anywhere banking facility through our network of Branches, Atm and
Internet banking facility.

 AT Par cheque books payable locally at all Magyar Bank locations.

 International Debit cum ATM cards with enhanced Cash withdrawal facility and other value
add on s.

 Online Banking with funds transfer, online shopping and bill payment options.

 Depository services with free online trading accounts.

Meal Cards on a master card platform.

 Employee Reimbursement accounts as a savings account variant.

 Preferential pricing on loan products and credit cards and other banking products & services*

Smart Privilege Account

For the woman of today

In today's busy world it's tough being a working woman. Right from shuttling between a job and
family to taking care of her finances she has to be on her toes all the time. Keeping this in mind,
we at Magyar Bank have designed a savings account best suited for the woman of today. With
the Smart Privilege Account, you can manage your money and your life and as well as enjoy a
host of lifestyle privileges. Furthermore Magyar Bank's Smart Privilege Account ensures that
you have enough time for all the important things in life.

Jewellery Insurance on Debit Card

 Zero Balance Minor Account

 Round-the-Clock access through ATMs: There could be an instance when at 3 am you could
require cash. With our round-the-clock access you can withdraw cash up to Rs. 40,000 per day,
deposit cash/cheques, transfer funds, print a mini statement and pay insurance premiums (LIC),
all through our ATM channel which is one of the largest ATM networks in the country.

 Anywhere Banking: Imagine being in an unknown city and still having complete access to all
your transaction needs. As a customer of the bank, you are in control and not restricted to the
branch. So even if you are travelling, you can access your account easily from any of the 700
plus Magyar Bank offices spread over 400 cities across the country.

Pension Savings Account

Are you a Pensioner seeking banking solutions tailored to your needs?

Pension Savings Bank Account, from Magyar Bank is specifically, designed for
Pensioner's (Existing &Prospective) of Central Govt. Civil Ministries/Departments & Deffence
ministry keeping in mind the fact that a Pensioner's banking requirements are wholly different
and requires special consideration.

Benefits

Timely communication to the customer on receipt of the PPO

 No delays in commencement of pension disbursals -The Bank is handling the disbursement of

Pension under a Centralized Pension Disbursement Module wherein the Pensioner records are
credited centrally through its Centralized Pension Payment Hub (CCPH) at Mumbai.

 Timely issue of Form- 16A for tax deducted at source in the immediately previous financial
year
 Timely revisions based on changes in rates of Pension or Dearness Allowance, done centrally
from the CCPH

DEPOSITS

Fixed Deposits
Safety, Security and Growth Magyar Bank offers you simple reinvestment Fixed Deposits (at
very competitive interest rates), which can be opened with a minimum investment of Rs 10,000.
You can make additions to your deposit in multiples of Rs 1,000 each. The tenure of your
deposit must be a minimum of 6months.

Deposit Schemes

Reinvestment Deposits:
In a reinvestment deposit, the interest accrued to your deposit at the end of each quarter is
invested along with the principal. The tenure of your deposit must be a minimum of 6 months. At
the end of the quarter, the interest and the principal are both rolled over, and the interest is
calculated on the total sum. Income tax is deducted at source.

Automatic Rollover:
As a Fixed Deposit holder, you can avail of the facility for automatic rollovers on maturity (for
both the principal and interest). You can select this option in the Account Opening Document
(AOD). The options available are:

 Rollover only Principal:

Only the principal amount will be rolled over. The interest will be either credited to your
designated account or paid out.

 Rollover Principal and Interest accrued in Reinvestment Deposit:

This wills rollover both the deposit and the interest accrued for the same tenure at the interest
rate applicable on the maturity date.

Withdrawals
 All encashment or withdrawals of Fixed Deposits can only be made at the branch where the
deposit was booked. Method of calculation of interest

 For deposits with tenure of 6 months & above, interest is calculated on a quarterly basis.

 Interest earned during the previous quarter is added to the Principal for calculation of interest.
Interest on this amount is calculated every quarter.

TA X E-PAYMENTS

Magyar Bank is authorized by Reserve Bank of India (RBI)and Govt. of India for collecting
Income/ other Direct Taxes and Central Excise & Service Tax since August2003 through its
authorized Braches and through e-Payments. You can pay your Income / Other Direct Taxes, as
well as Central Excise & Service Tax* through iConnect from your account online and get on-
line acknowledgement of the payment by way of a Cyber Receipt, including Challan
Identification Number (CIN) immediately after making the payment

Direct Tax Payment

The Bank is authorized for Collection of Income or Other Direct Taxes on behalf of Central
Board of Direct Taxes (CBDT) w.e.f 1October, 2003. The assesses or taxpayers can pay Income
or Other Direct Taxes as listed below at 214 authorized branches of Magyar Bank across the
country and also by online mode through 'e-Payment 'Facility' in case they maintain Accounts
with Magyar Bank.

Corporation Tax- Tax on Companies and Tax Deducted at Source from Companies
 Income Tax

Interest Tax and Expenditure Tax

 Gift Tax

 Wealth Tax

 Fringe Benefit Tax (FBT)

 Securities Transaction Tax (STT)

 Banking Cash Transaction Tax (BCTT)

 Other Tax Deducted or collected at source (TDS or TCS) on salaries of employees, income
from Fixed Deposits, Vendor Payments, Rent, Income from Game Shows or Lottery, etc.

 Any other Direct Tax including Advance Tax

Pension Disbursement
Central Civil Pension Disbursement

The Bank is authorized by RBI and Central Pension Accounting Office (CPAO) for
disbursement of Central Civil Pension through its 218 authorized branches across the country.
STP PF MAGYAR BANK

Segmentation

Demographics variables
 Location: Metros and divisional cities

 Occupation: Business persons, Salaried class, Working woman.

 Age: Senior citizens, minor.

Psychographic variables:

 Lifestyle - The people who believes in modern banking with higher set of services i.e. Internet
banking (contact, mobile refill, travel currency card etc.).

Targeting

Corporate banking market: This market targets the industries and fulfill their financial needs.

• Capital market: This segment is targeted on the long term needs of the individual as well as on
the industries.

• Retail banking market: This segment is for the retail investor and provide them short term
financial credit for their personal, household needs.

Positioning

Magyar Bank has positioned itself as a bank which gives higher standard of services through
product innovation for the diverse need of individual and corporate clients. So they want to
highlight following points in their positioning statement:
 Customer centric

 Service oriented

 Product innovation

Marketing mix of MAGYAR BANK

7P’S of marketing mix

 PRICE
 PROMOTION
 PHYSICAL EVIDENCE
 PEOPLE
 PRODUCT
 PROCESS
 PLACE

PRODUCT

1. INVESTMENT BANKING
2. CORPORATE BANKING
3. RETAIL BANKING
4. PRIVATE BANKING
5. INVESTMENT BANKING
6. MORTGAGE BANKING
7. CREDIT CARD
8. E- BANKING

PRICE

1. VALUE FOR MONEY

2. LOW FEE CHARGED
 PROMOTION

1. Advertisement
2. Print media
3. Publicity
4. Sales promotion
5. Personal selling
6. Telemarketing

PROCESS

1. Flow of activities
2. Standardization
3. Customization
4. Number of steps

PHYSICAL EVIDENCE

1. Internet
2. Paperwork
3. Brochures
4. Furnishing
5. Business card
6. ATM ’s
7. Logo
8. Employee dress code, etc.

PEOPLE

1. EMPLOYEES