Impact of Demonetization on Bank Loans and Deposits

IMPACT OF DEMONETIZATION ON LOANS AND DEPOSITS OF BANK
CHAPTER-1
RESEARCH DESIGN
1.1 INTRODUCTION
The Government has implemented a major change in the economic environment by
demonetizing the currency Notes-of Rs 500&Rs1000 Denomination. The midnight of 8 th
November 2016, people have been given up to December 30-2016 to exchange the notes.
The asset quality problems for banks and finance companies are rising as small customers
continue to struggle with the adverse effect of demonetization. But it might show up only the
fourth Quarter numbers, as the Reserve Bank of India (RBI) has given an additional 60days
for lenders to classify accounts as non-performing.
According to public sector Bank executive, the work pressure from managing deposits and
cash withdrawal is coming down &Bank have begun to assess the impact of demonetization
on the loan side- both asset quality and demand for credit. The loss of income has severely
dented the loan repayment ability of small borrowers. Also many of those Bankers who were
deployed for loan recovery were put on the job of managing a sudden surge in activity at
branches after Demonetization. The combined effect will be a rise in stressed loans &deposits
by at least cash transactions and thus is considerably affected by the withdrawal of ₹.500 and
₹.1000 notes.
The fallout of demonetization will be a drop in credit growth. Advances and deposits for the
banking system are expected to grow at 10-11 per cent in FY 17. Now credit may expand at a
slower pace of 5-6per cent, in the preceding quarter, but as cash availability increases
&restrictions on withdrawals go, moderation will occur, it said. It also said that retail
payment systems, such as card transactions and mobile wallets, saw a significant uptick in
activity post demonetization but “The transition to a cashless environment will take time.”
The government had on November 8-2016, which accounted for 86 per cent of the currency
in circulation.
This led to a slowdown in economic activity &weight on demand for credit among companies
and retail borrowers during the December quarter. “Banks have experienced significant,
inflows into their deposit base as customers deposit their existing holdings of the
demonetized notes. However, we maintain our view that the level of bank deposits will
Dept. of Commerce, VSK University. Ballari. Page 1

increases by only around 1-2per cent in the near term, given the substantial role of cash in the
Indian economy as a medium of transaction, “Economic activity suffered in November &
December 2016 as households & businesses experienced liquidity shortages following
demonetization.
We expect asset quality in the quarter ending march 2017 to show more adverse trends as the
quarter ended December 2016 may have benefited from the fact that only two of the three
months were a affected by demonetization . Nevertheless, it seems that the impact on asset
quality from demonetization will be manageable for the banking sector,” on February 3,
2017, total currency in circulation was around Rs9.8 lakh crores, which is about 58per cent of
the level seen before demonetization. “The amount of currency in public circulation
continues to increase steadily, indicating that the limiting factor is the supply of currency
rather than the demand for it. “Demonetization has significantly impacted credit demand and
deposit growth but effect on asset quality has been mixed; retail payment systems have
benefited. While commentary from the banks points to rise in activity in January 2017,it is
still below pre –demonetization levels.
In its report, researcher said the slowdown in loan growth may also have been in part
due to loan repayments using the demonetized currencies. Deposits at rated banks grew by
13% year –on –year in the December quarter, from 6% in the preceding quarter, but as cash
availability increases and restrictions on withdrawals go, moderation will occur, it said.
It also researcher said that retail payment systems, such as card transactions and
mobile wallets, saw a significant uptick in activity post-demonetization. But “the transition to
a cashless environment will take time.” The government had on 8 November 2016,
announced junking of Rs500 and Rs 1000 notes, which accounted for 86% of the currency in
circulation. This led to a slowdown in economic activity and weighed on demand for credit
among companies and retail barrowers during the December quarter, ‘Bank have experienced
significant inflow into their deposit base as customers deposits their existing holdings of the
demonetize notes. However we maintain our view that the level of bank deposits will
increase by only around 1-2% in near-term, given the substantial role of cash in the Indian
economy as a medium of transaction.”
Banks have witnessed a gigantic increase in deposits. This is mainly because of the
short deadline for depositing high-value currency notes. Around Rs 5.5 lakh crore has already

been deposited in banks till November 1.8, as per government data. This resulted in high
liquidity in banks. In comparison, currency worth Rs 1.03lakh crores has been issued till
November 18.
The demonetization caused deposit rates to dip, but there is still some good news for
customers. An excessive influx of deposits coupled with a poor demand for credit will force
lending rates to decrease too. While this may not happen immediately, it can come in handy
for prospective buyers looking for cheap loans in the near future.
1.2 LITERATUREREVIEW
1.2. A) Woodford (2003)

Cashless economy is not the complete absence of cash, it is an economic setting in
which goods and services are bought and paid for through electronic media. According to
Woodford, cashless economy is defined as one in which there are assumed to be no
transactions frictions that can be reduced through the use of money balances, and that
accordingly provide a reason for holding such balances even when they earn rate of return. In
a cashless economy, how much cash in your wallet is
Practically irrelevant. Researcher can pay for to purchases by any one of a plethora of
credit cards or bank transfer.
1.2. B)Marco and Bandier a (2004)
Argue that increased usage of cashless banking instruments strengthens monetary policy
effectiveness and that the current level of e-money usage does not pose a threat to the
stability of the financial system. However, it does conclude that central banks can lose control
over monetary policy ment does not run a responsible fiscal policy.
1.2. C)Author JayatiGosh
Said that on 9 th November 2016:-There was no need for secrecy, all demonetizations
through history have been done with some advance warning, to the people . Commenting on
demonetization, jayati said; any disruption in the flow of money, verily the economy’s
lifeblood, impacts business cycles quicily.there is no precedent to the scale of demonetization
that has taken place in India. That is why quantifying its impact is so difficult. A few
countries that replaced their old currency with new did it in a gradual manner the introduction

of the euro in the Eurozone, or in Zimbabwe where the old currency was gradually phased
out.”
1.2. D)Kartikhosanagar
On 8th November 2016. The demonetization against the backdrop of other economic gains.
The year 2016 has over all been a good year for India.
1.2. E)AnkurArun
He wrote on 6th December 2016. Black money has already paid more than the effective tax
rate just to convert black money into legally able currency, deposits or assets.
1.2. F) Finance minister Arunjaitly
Said on 8 th December 2016 demonetization would be felt in the long term benefits & a
short term pain was incurred. “Demonetization should be seen according to the effect on the
economy,” author said while addressing the petrotech 2016 conference. “No doubt we will
continue to be the fastest growing major economy. A decision of this kind carries the pain of
transition. This is regrettable, but it was expected.” “When author look at the long –term
impact of these steps which are going to be taken, I think India is going to become a society
in the long term with long term with a certainly better GDO, cleaner ethics, a cleaner
economy,” he added.
1.2. G) Shruthikatta
Finance adviser, written on November 25th 2016:- .the demonization more people are
depositing money into the banks. This means the banks have more liquid funds & more
money to lend. Many banks have also slashed their deposit rates including SBI, SBM, ICICI
BANK, HDFC BANK.
In the banking world, when deposit rates are cut, it generally means the lending rates
will also be slashed down. Since banks are paying lower deposit rates to customers, this
allows them room to charge lesser on loans.
1.2. H)SuryatejaRokkam
On November 9th 2016 it’s a bold move by the government & can be called as the
surgical strike of the government on black money. There will be a lot of people who have a
lot of cash, legally earned, which they will deposit it in the bank. Now the bank with more
deposits can do more lending. Credit (loans) will become easier and interest rates may come
down. More loans given out increase broad money supply and created inflation. But this will
happen slowly, not over-night. Deflation and inflation will balance out each other in the
future.

1.2. I) Siddhartha Bhattacharya

Written on December 21th 2016. The basic question which needs to be answered is
can the government ensure that not a single citizen will lose a penny from their lifelong
savings? Temporary suffering can be rationalized as “greater good” but a scheme which
causes people to lose their own earned money is not. Demonetization by itself isn’t a
panacea or universally “good solution”. For example Last week Venezuela following India’s
lead implemented national demonetization “to tackle smuggling and black money.” The
ruling party is highly unpopular, the country is going through a hyper-inflation and it’s being
remarked as a “cover-up” for his failings. in essence, demonetization is as much as a political
move as an economic one for national interests.
1.2. J)Amkor Arun
Written on December, 6, 2016:- Demonetization is a deep psychological strike on
black money. Demonetization move has killed the very motivation of those people who have
the ability to generate black money. A person who had black money has already paid more
than the effective tax rate just to convert his black money into legally tender-able
currency/assets. Such people are in a state of shock as though they have already paid tax at a
higher effective tax rate but still their black money has not got converted into legitimate
income. To top it up their wealth has substantially gone down as they have overnight lost
more than 50% value in real estate holdings.
1.2. K)Anup Roy
November 16, 2016:- The jury may be still out on the effects of demonetization but a
consensus is developing that it will bring down the interest rate. Yields on 10year
government bond, a benchmark of the prevalent rate in the economy, have fallen more than
25 basis points since prime minister Narendramodi scrapped Rs 1000 and Rs 500 notes on
November 8.bank opened the next day amid chaos, as people rushed to the branches to
exchange their old notes and to withdraw up to the limit of Rs 4000. The rest of the old notes
will go directly to the banks as low-interest- earning current and
Savings account deposits. The high – value notes made up Rs 14.1lakh crores of the
cash on circulation. If a substantial portion of that comes back to the banks, there will be a
massive spike in deposit base.

1.2. L)Parthasarathy
Written on 4, January 2017:- on the evening of the 8th of November, when people
were eagerly awaiting the US presidential election results, due in less than a day’s time.
We all know that banks are getting loans and deposits post the demonetization, and this will
definitely impact their deposit rates. Why will any bank pay high interest rates when money
is available so easily? Following the SBM’s lead, many banks have already started reducing
their fixed deposit rates, with the rates in some cases even falling below the savings account
rates offered by some banks. Putting your investments in fixed deposits at this point of time is
equivalent to putting your money under your pillow, as the returns will surely not even beat
inflation
 NEED AND IMPORTANCE :-

The need for study is to know the loan’s & deposits of the bank towards the investors
or publics companies. I want to know in depth of the loans and deposits of the bank and
change in perception towards the public, company or investors. How the people will update
their knowledge of impact of demonetization on loans and deposits. The study also concerts
on knowing the segment of loans and deposits.
 STATEMENT OF THE PROBLEM :-

On November 8 government announced the decision to discontinue the legal tender
status of Rs500& Rs1000 notes. The original objectives were stated as; eliminating fake
currency; inflicting losses on those with black money; and disrupting terror and criminal
activities later, new objectives were tacked on; enabling growth in bank credit, turning India
into a cashless economy.
There is a drastic change in the made of loans and deposit of the bank. Due to
demonetization there for the present study is conducted to critically evaluate the impact of
demonetization on loans and deposits of bank.
 OBJECTIVES :-
1) To identify the bank performance of loans and deposits of before & after
demonetization.
2) To know the role of SBM bank on demonetization situation.
3) To study the loans and deposits provided by the SBM bank after demonetization.

 SCOPE OF THE PROJECT :-

A study covered on impact of demonetization on loans and deposits of STAT BANK
OF MYSORE at cantonment (branch) Ballari and analyses the services provided by the bank
as before and after loans and deposits of demonetization.
METHODOLOGY :-
Sources of data: - the study was conducted by making use of both primary data and
secondary data.
Primary data: -
The primary data has been collected from the discussion & meetings with managers,
clerks, and other official.
Secondary data:-
The following are the data collected from secondary sources;
 Documents and files of the bank
 Internet
 Magazines
 Annual repo
 LIMITATIONS OF THE STUDY

The limitations of this study may be summarized as follows
1) A detailed study cannot be done because of time constraints.
2) The data limited to only one bank.
3) Getting co-operation & correct information from the bank is very difficult due to their
inherent problem
CHAPTER SCHEME
Chapter I:-
It includes introduction, literature review, need and importance, statement of the problem,
objectives, scope, research methodology, and limitation of the study.

Chapter II:-
It includes bank profile, introduction, history of State Bank of Mysore, vision,
mission.
Chapter III:-
It includes theoretical background, meaning, advantages & disadvantages,
importance’s.
Chapter IV:-
It includes data analysis, charts, and interpretation.
Chapter V:-
It includes findings, suggestions, conclusion, and bibliography.

CHAPTER 2 – Profile of the Study area
2.1Bank profile
2.2 Introduction
2.3 History of State Bank of Mysore

Chapter II
STATE BANK OF MYSORE PROFILE
INTRODUCTION
State Bank of Mysore its native name Mysore Bank and it is one of the public sector
bank and industry are Banking, Insurance Capital Markets and allied industries and
predecessor The Bank of Mysore Ltd. Headquarters at Bengaluru, Number of locations 976
branches and extension counters, and area served India, and its chairman Arundhati
Bhattacharya, and Managing Director N K chari. And its products Deposits, Personal
Banking Schemes, C & I Banking schemes, Agri Banking Schemes, SME Banking Schemes,
and its services Loans, Deposits, Mobile Banking, ATM Services, NRI Services, Real Time
Gross Settlement (RTGS) Transactions, National Electronic Fund Transfer (NEFT), Internet
Banking, Debit Card. Total equity raise in 3988 Crores as on 31 Mar 2014, Number parent
State Bank of India (holds 90.00% shares).
State Bank of Mysore was established in the year 1913 as The Bank of Mysore Ltd.
Under the patronage of Maharaja Krishna Raja Wadiyar IV, at the instance of the banking
committee headed by the great Engineer Statesman, Bharat Ratna Sir M. Visvesvaraya.
During 1953, “Mysore Bank” was appointed as an agent of Reserve Bank of India to
undertake government business and treasury operations, and in March 1960, it became a
subsidiary of the State Bank of India under the State Bank of India (subsidiary Banks) Act
1959.
HISTORY
Year - event
*1913 - The Bank was established as 'Bank of Mysore Ltd.', on 19 May, with an
authorized capital of Rs.20.00 lakhs.
*Commenced its business on 2 October 1913.
*1953 - During the year, the Bank was appointed as an Agent of Reserve Bank of
India to conduct Government business & treasury operations.
*1959 - With effect from 10 September, the Bank was constituted as State Bank of
Mysore as a Subsidiary of State Bank of India, under State Bank of India [Subsidiary
Banks’s] Act, 1959 enacted through an Act of Parliament, [Act No. 38 of 1959s].

*1959 -The bank has formulated schemes for financing coffee planters/coffee traders
against coffee curers certificate, financing coffee traders, coffee exporters & coffee curers
who also engage in trading.
The Bank actively participated in all Government sponsored schemes and contributed
its share of financial assistance or the economically weaker sections through DIR., IRDP,
Prime Minister RojgarYojna& some schemes.
*The Bank has sponsored two Regional Rural Banks, Cauvery Grameena Bank
&KalpatharuGameena Bank which were merged to form Kaveri-KalpatharuGraminBrank,
headquartered at Mysore with more than 250 branches for growth of agriculture & rural
industries.
*The Bank, as part of State Bank Group has been engaged in financing agriculture
and MS ME in 1960 & introduced the concept of need based rather than security oriented
finance & the Entrepreneur scheme under which technically qualified persons were financed
the entire requirement up to Rs.2 lacks.
*The Bank has 3 specialized SSI branches to assist the SSI units & proposes to
establish 3 more such 551 branches shortly.
*The Bank has correspondent & agency arrangements all over the world & offers spot
services in 18 major approved currencies.
* State Bank of Mysore handles a significant part of day-to-day banking business of
both the Central & State Governments in the State of Karnataka & is a Banker to various
Public Sector Undertakings in various sectors of Economy.
*The Bank has been actively participating in welfare banking needs of public through
its community services.
* The Bank is a member of society for worldwide Inter Bank Financial
Telecommunication [SWIFTs] which was established to offer cost effective & fast
transmission of financial messages globally, 2 branches of Bank are presently covered under
the scheme and an additional 15 branches are proposed to be covered under SWIFT shortly.
*1992 - The State Government has also taken up vigorously 'ASHRAYA', a new
housing scheme for weaker sections & 'VISHWA', a new rural & cottage industry scheme. A
new programme called 'AKSHAYA' has also been launched to help the children in primary
education. The Konkan Railway Project & the New Mangalore Port Project are also
progressing satisfactorily.

*1994 - Several important measures have been introduced in the busy season credit
policy of November 1993 & slack season credit policy of May 1994, announced by Reserve
Bank of India.
*2000 - Mr. M. SitaramaMurty has been appointed as Managing Director, of Bank.
Crisil has reaffirmed the A+ & P1+ ratings assigned to the bond issue & the CD
programme of bank.
*2001 - State Bank of Mysore has opened a foreign exchange cell at its Hirehally
Industrial estate branch in Tumkur district to enable small-scale industrialists to manage their
foreign exchange transactions.
The Bank has closed its issue of unsecured non-convertible debentures after raising
the target of Rs 60 crores.
*2002
Enters the market with a coupon of 6.4% per annum for its Tier-II capital bonds issue
of Rs.60cr on a private placement basis.
Slashes interest rate on domestic term deposits & on NRE deposits by 25-50 basis
points.
*2003
Considers new method of appraisal for lending to the agricultural sector more on the
lines of industrial credit given to trade & commerce.
Declared a dividend of 40% on equity capital for year ended.
Ties up with HMT Ltd & launches SBM-HMT Agri Farm Scheme, to promote
agricultural mechanization in south India.
-MarutiUdyog forges alliances with SBM to offer car finance.
*2004
Mr. Vijayanand assumes charges as Managing Director of bank from 01/03/2004
State Bank of Mysore has joined the Real Time Gross Settlement Systems [RTGSs]
network that facilitates inter-bank funds settlement on 22 July.
* 2005: 100% computerization and Core Banking Solutions (CBS) introduced.
* 2005: SBM unveils new single window system {{clarify date=September 2011}}
*2006: Mr. P.P. Pattanayak has assumed charge as Managing Director of State Bank
of Mysore. Mr. Pattanayak was earlier Deputy Managing Director [DMDs] & Chief Credit
Officer of State Bank of India, Mumbai.
*2009 : The Company splits its share with face value from Rs.100/- to Rs.10/-.

*2009: Sri DilipMavinkurve takes charge as Managing Director of the Bank. He was
earlier Chief General Manager of the Bank.
*2012:ShriSharad Sharma takes charge as Managing Director of the bank.
*2013: The Bank celebrated its Centenary year during the period 2 October 2012 to 1
October 201
State Bank of Mysore was established in the year 1913 as Bank of Mysore Ltd. Under
the percentage of the erstwhile Govt. of Mysore, at the instance of the banking committee
headed by the great Engineer- Statesman, Dr. Sir M.Vishweshwarayya. Subsequently, in
March 1960, the Bank became an Associate of State Bank of India. State Bank of India holds
90% of shares. The Bank’s shares are listed in Bangalore, Chennai and Mumbai stock
exchanges.
State Bank of Mysore is an India-based bank. The Bank’s segments include Treasury,
Corporate/Wholesale Banking and Retail Banking. The Bank provides personal banking and
corporate banking services. Its personal Internet banking portal provides personal banking
services that give customers control over all their banking demands online. Its corporate
banking application provides features to administer and manage non personal accounts
online. Through the Company’s Website, customers can know the information on schemes
and products for various segments, besides online loan application for education, housing, car
and gold loans. The Bank also offers various deposit products, credit management,
agriculture, foreign exchange services. The Bank has a network of approximately 1,040
branches spread over 20 States and a Union Territory. Its branch network consists of over 240
metro, approximately 225 urban, over 230 semi-urban and approximately 340 rural branches.
VISION
“National multi-commodity exchange of India limited is committed to offer world
class services of on-line screen based futures trading of permitted commodities and well
organized clearing and guaranteed settlement, while complying with statutory / regulatory
requirements.”
It shall strive to ensure continual improvement of customer services and remain
quality leader amongst all product exchanges.

MISSION
“A premier commercial Bank in Karnataka, with all India presence, committed to
provide again and again superior and personalized customer service backed by employee
conceit and will toExcel, earn increasingly high returns for its shareholders and be a
responsible corporate citizen contributing to the well being of the society.”
OBJECTIVES
 The objective of State Bank of Mysore is to provide better and cost effective services
to customers located all over the region by the help of their expert team to full fill the need of
customers.
 Services like-Loans, Deposits, Mobile Banking, ATM Services, NRI Services, Real
Time Gross Settlement (RTGS) Transactions, National Electronic Fund Transfer (NEFT),
Internet Banking, and Debit Card.
 Products like-Deposits, Personal Banking Schemes, C & I Banking Schemes,
Agriculture Banking schemes, SME Banking Schemes.
 Industry, Banking, Insurance, Capital Markets and allied industries.
Branch Network
The Bank has widespread network of 1,074 Branches (as on 31.12.2016) and 7
Extension Counters spread all over India including 3 Corporate Accounts Branches, 9
Industrial Finance Branches, 9 Agricultural Development Branches, 7 Small and Medium
Enterprise Branches, 7 Specialized Personal & Services Banking Branches, 4 Government
Business Branches, 2 Specialized NRI Branches, offering wide range of services to the
customers besides 2 Service Branches and 1 Asset Recovery Branch rendering backup
support to the Bank.
Financial Profile
The Paid-up capital of the Bank as on 31.12.2016 is Rs 48.01 crores of which State
Bank of India holds 90% share. The Bank has a Capital Adequacy Ratio of 11.60% under
Basel-III guidelines. The Bank has an enviable track record of continuously earning profits
and payment of uninterrupted dividend every year since its inception in 1913.
Total Deposits of the Bank as at the end of December 2016 stood at Rs 80,348 crores
and the total Advances stood at Rs 53,584 crores, including export credit of Rs 1,424 .

Bank profile
crores. The Bank is a major player in Foreign Exchange dealings also and has
recorded a merchant turnover of Rs 55,353 crores and a trading turnover of Rs 5,67,194
crores during the 9 months ended December 2016.
Human Resources
The Bank has a dedicated workforce of 10,226 employees consisting of 3,600
supervisory staff and 6,626 non supervisory staff (as on 31.12.2016). The skill and
competence of the employees have been kept updated to meet the requirement of our
customers keeping in view the changes in the business environment.
Organizational Setup
While the Chairman of State Bank of India is also the Chairman of the Bank, The
Managing Director is assisted by two Chief General Manager and 13 General Managers.
Management Committee of the Bank
Managing Director Mr. N. Krishnamachari +91 80 22251855
+91 80 22353480
Fax 080 22254753
Chief General Mr. Siva Nainar I +91 80 22251570
Manager( Retail Banking) Fax 080 22350563
Chief General Manager Mr.T.Keshav Kumar +91 80 22350095
(Commercial Banking)
Chief Vigilance Mr. Anil Kumar Mittal +91 80 22255617
Officer Fax 080 22350562
General Manager Mr. M.P. Sridharan +91 80 22257149
(Treasury) & Chief Finance Fax 080 22353494
Officer
General Manager Mr. M.P. Sridharan +91 80 22257149
(Risk Management and (Additional Charge) Fax 080 22353494
Credit Policy and
Procedures)
General Manager (IT, New Mr. George M Kurian +91 80 22352591
Business &Govt Business) Fax 080 22356472
General Manager Mr. K S Subbaraman +91 80 22353471
(Corporate Network, Fax 080 22356472
Bangalore)
General Manager Retail Mr.Devendra Sharma +91 11 27020940

Network-III, HQ- New Fax 01127021041

Delhi
General Manager (Personal Mr. M R Jayesha +91 080 22353001
Segment Banking, Cross Fax 080 22353966
Selling &BPR)
General Manager Mr.Nemiraja.H.C +91 080 22340299
(Inspection & Audit Fax 080 22353459
CCSD& Customer
Complaints, Priority Sector,
Rural Banking & Financial
Inclusion)
General Manager (SAMG) Mr. M V S N Murthy +91 80 22355202
Fax 080 22353491
General Manager (Human Mr. C P KishorBabu +91 80 22353487
Resource & General Fax 080 22353478
Administration)
General Manager Retail Mr. S Venkateswaralu +91 0821 2542960
Network-II HQ- Mysore
General Manager- Retail Mr. Suresh Savekar +91 80 22350101
Network-I, HQ- Bangalore Fax 080 22375304
Banking Services
 Car Loan
 Gold Loan
 Home Loan
 Loan against property
 Personal Loan
Interest Rates on Savings Account

The following types of Savings account are offered by the State Bank of Mysore in
which the customer can save surplus money and can also make withdrawals as per
requirement. Each account earns an interest rate of 4% p.a. which is paid by way of account
credit.

 MybankSuraksha Savings Account.

 MybankSuraksha Savings Plus Account
 Saral Savings Bank Account
Fixed Deposit Interest Rates
The interest rates payable on the term deposit schemes which are also called fixed
deposit schemes more popularly are higher than those payable on the savings account
because the money is held for a longer tenure
 The Short-term Fixed Deposit Rates- The fixed deposit interest rates on short-term
basis ranges from 5.5%p.a. to 7%p.a.
 Medium and Long-term Fixed Deposit Rates- For 1-3 years the rate stays at 9%
mark p.a. but for tenure between 1-3 years it sees a downfall of 0.1% making it 8.9% p.a. on
long term holdings.
 Senior Citizen Fixed Deposit Rates- For term holdings by senior citizen, interest
rates is increased by 0.4%.
State Bank of Mysore Home Loans
Various types of loans are provided by State Bank of Mysore out of which a home
loan is also a variety which provides loans for the purpose of buying or building or building a
residential house. The rate of interest is charged on both fixed as well as floating basis. The
base rate stands at 10.00% whereas the prime lending rate is 15.00%.
State Bank of Mysore NRI Banking
NRIs can avail banking solutions from the State bank of Mysore through different
types of account opened and maintained with the bank including:
 NRE Account- The account can be in the form of savings, current. Term-deposits or
reinvestment deposit accounts and is maintained in the form of Indian Rupee. All the
proceeds in this account are freely reparable.
 FCNR Account- This account can be in the form of term-deposits or reinvestment
deposits and can be maintained in the foreign currencies namely US Dollar, Pound Sterling
and also Euro. Conversion of the currency to Indian Rupee is possible at the prevailing
exchange rate.
 NRO Account- This loans available in this account are in the form of Indian Rupee
whereas the repayment of that loan can be in both foreign currency and Indian Rupee. The
proceeds in this account are not at all reparable.

State Bank of Mysore Internet Banking

The rapid increase of technology has made people computer-friendly and internet has
become a very powerful tool. In keeping with this trend, the State Bank of Mysore also offers
banking facilities mentioned below which can be done over the internet and visiting the
branch is not required.
 Knowing the balance of your account

 Obtaining the account statement
 Issuing of cheques and demand drafts
 Buying a fixed deposit scheme
 Making fund transfers anywhere
 Making payment of your taxes.
 Making payments of your various utility bills which can be your phone bills,
electricity bill, water bill, etc.
State Bank of Mysore's Personal banking.

Deposits
we meet needs - of an investment of your surplus funds or to park your hard-earned money,
you will find a product just right for you, delivered at a branch close to you. Open an account
with any of our branches and realise the advantage of our vast network. Earn high interest on
fixed deposits, putting your money to work for you with confidence and security.
Interest Rates-Domestic Deposits
New Deposit Schemes

MYBANKSANCHAY Savings Bank Account
Centenary Liquid Term Deposit
MybankSuraksha Savings Account
MybankSuraksha Savings Plus Account
MybankSuraksha Time Deposit Account
Saral Savings Bank account (No Frills account)
SBM Tax Saver Scheme

Multi Option Deposit Scheme

Savings Bank account
Term Deposits
Reinvestment Deposits
Recurring Deposits
Harsh Deposit
Public Provident Fund Scheme
New Deposit Schemes

MYBANKSANCHAY
1 Name of the Product MYBANKSANCHAY Savings Bank Account
2 Purpose To offer a distinct special Savings Deposit product to customers
3 Segment Personal Segment.
4 Eligibility Residents only (Single or Joint)
5 Type of account Savings Bank Account
6 Account opening As applicable to Savings Bank Account. KYC norms to be adhered
procedure to as per extant instructions.
7 Available at At all Branches of the Bank.

8 Deposit amount Average Quarterly Minimum Balance
a)Rs.5,000/- for Rural Branches

b) Rs.10,000/- for Semi-Urban & Urban Branches
c) Rs.20,000/- for Metro Branches
If average quarterly minimum balance is not maintained, the account

will be converted to normal Savings Bank account. All the value added
benefits available to MYBANKSANCHAY will be withdrawn.
9 Rate of Interest As applicable to Normal Savings Bank account
10 Age Above 10 years
11 Additional features a) Cheaque Book 50 leaves free
b) Free Issue of State Bank Gold International Debit Card. $
c) Free Accidental insurance cover of Rs.2 lacks for those who opt for
Gold International Debit Card. $
d) Free issue of Platinum International Debit Card for those who

maintain Average Quarterly Minimum Balance is > Rs.50,000/-.$

e) Free Accidental insurance cover of Rs.5 lacks for those who opt for
Platinum International Debit Card. $
f) Free Accidental Insurance cover of Rs.1.00 lakh for those who do

not opt for either Gold Card/Platinum Card.
g) Instant SMS alerts for all Gold International Card Transactions.
h) SMS alerts at a nominal fees of Rs.15/- per quarter
i) Unlimited transactions in State Bank Group ATMs,
j) Balance Certificate charges (current year)-Free
k) RTGSS/NEFT – Free – 2 per month
l) Provision of opening SB Account on line.
m) Internet Banking Facility,
n) Mobile Banking facility,
o) Provision of E-Statements
p) Daily Cash withdrawal Limit at ATMs is Rs.1,00,000/- for State

Bank Platinum International Debit Card and Rs.50,000/- for State Bank
Gold International Debit Card.
$ Insurance cover for customer who opt for Debit Card will commence after issuance of the
Card.
Loyalty points on every spending in Debit Card for POS and online transactions.
For those who do not opt for the Debit Card, PAY for Rs. 1.00 lac @ Premium Rs.36/-
(absorbed by the Bank).
* A letter of undertaking would be obtained for having agreed to the Terms of the Scheme.
Centenary Liquid Term Deposit
Name of the Product “CENTENARY LIQUID DEPOSIT”

1
2 Purpose To offer a distinct Term Deposit product to High Net Worth

customers with higher rate of interest.
3 Segment all segments.
4 Eligibility Resident &Nonresident individuals, institutions, corporates and

schools etc. excluding minors (without guardian)

5 Type of account term deposit
6 Account opening As applicable to Term deposit.

procedure
7 Period of deposit 7 days to 179 days
8 Available at At all Branches of the Bank.
9 Deposit amount Minimum: Rs.1.00 crores. Maximum – Rs.50.00 crores.

10 Rate of Interest (With PERIOD REVISED RATE OF INTEREST
effect from 24.06.2015) (%)
7 DAYS TO 90 DAYS 6.50
91 DAYS TO 179 DAYS 7.00
11 Others i) No penalty for premature withdrawal, if held for more

than 7 days.
ii) ii) No loans/overdraft.

12 Product available from 01.01. 2013.
MybankSuraksha Savings Account

Name of the Product MybankSuraksha Savings Account
Eligibility Individuals, excluding NRI customers

Mode of holding Single or Jointly. In case of joint accounts insurance cover will
be provided to first named persononly.
Type of account Savings Bank account
Minimum quarterly average Rs 10,000/-
balance
Rate of interest As applicable to Savings Bank deposits.
Debit entries allowed free of 50 per half year.
charges
Cheaque leaves issued free of 25 leaves free in a year.
charges
Insurance cover An accidental death insurance cover for `2.00 lacs will be

provided to the depositor free of cost. This benefit will be

subject to yearly review.
Other conditions All the other features of ordinary Savings Bank deposit i.e
ATM, Internet, Moblile Banking etc. will be available for this
product also.
Existing Savings Bank account holder can shift to Suraksha

Savings account by giving an application.
Insurance cover/Claim settlement subject to conditions.
Penalty will be applicable for non maintenance of Quarterly

balance.
MybankSuraksha Savings Plus Account

Name of the Product MybankSuraksha Savings Plus Account

Mode of holding Single or Jointly. In case of joint accounts insurance cover
will be provided to first named persononly.
Type of account Savings Bank account
Minimum quarterly average balance ` 25,000/-
Rate of interest As applicable to Savings Bank deposits.
Debit entries allowed free of charges 100 per half year.
Cheaque leaves issued free of charges 25 leaves free in a year.
Multi City Cheaque issued free 25 leaves free in a year.
of charges
Insurance cover An accidental death insurance cover for `5.00 lacks will be

provided to the depositor free of cost. This benefit will be

subject to yearly review
Other conditions All the other features of ordinary Savings Bank deposit i.e.
ATM, Internet, Mobile Banking etc. will be available for this
product also.
Existing Savings Bank account holder can shift to Suraksha

Savings plus account by giving an application.
Penalty will be applicable for non-maintenance of Quarterly

balance.
MybankSuraksha Time Deposit Account
Name of the Product MybankSuraksha Time Deposit Account

Mode of holding Single or Jointly. In case of joint accounts insurance
cover will be provided tofirst named person only.
Type of account TDR/STDR
Period of deposit 1 to 3 years
Amount of Deposit Minimum:` 1, 00,000/-.
Maximum: ` 99, 99,999/-.

Rate of interest Applicable Card rates.
Insurance cover An accidental death insurance cover for `5.00 lackes will
be provided to the depositor free of cost. This benefit will
be subject to yearly review.
Others All the other features of Time deposit i.e. Nomination
facility, Loan against deposit etc. is also available for this
product.

Penalty will be applicable for premature closure of deposit.
Saral Savings Bank account (No Frills account)

This account comes with very low minimum balances as well as low / nil charges, to
cater to the needs of individual from the vast sections of population who are, otherwise, not
fulfilling certain conditions of our existing Savings Bank requirements; Details are as under
Purpose To enable the common man to open/ maintain bank account at no cost.
Eligibility Individuals of 18 years and above.
Available at Presently in Rural Branches only.
Initial Deposit amount Rs. 10/-
Minimum balance to be
Zero.
maintained
If the value of business connection including interalia, the other liability

Minimum balance
products like Recurring Deposit or Term Deposit, exceed Rs. 10,000/- the
amount
account will be upgraded to normal SB account.
Rate of Interest As applicable to Savings Bank from time to time.
Cheaque facility will not be extended on this account.Withdrawals will be

Operation of the account
made through withdrawal forms. Maximum 4 withdrawals per calendar
and applicable charges
month. No restrictions on deposits in the account.
Account opening Extant procedure for opening a SB account will be applicable.

procedure
Whether ATM card

facility / standing
Not available.
instructions / overdraft
facility is available?
As applicable to deposit accounts.

Nomination
All other rules and regulations relating to SB accounts are applicable.
Tax saving scheme under Sec 80c of the IT act

A Bank Term Deposit Scheme 2006 has been introduced by the Central Government
commencing from the financial year 2006-07 wherein time deposits made upto Rs.1.00 lakh
for a period of 5 years are exempted from payment of Income tax under Sec 80C
Multi Option Deposit Scheme
A new deposit scheme combining the features of Current account, Savings Bank a/c, TDR or
RID a/c. The product proposes to give liquidity to the depositor with high returns and
convenience. It provides the depositor an automatic overdraft facility in Current a/c and
automatic withdrawal of Term deposits in units through SB a/c. Depositor has to
simultaneously open TDR / RID a/c for Rs.1000/-, SB a/c with balance Rs.500/- and Current
a/c.
Savings Bank account
You can open an account with a deposit as low as Rs.500/-(Rs. 1000/- for chequebook
facility and Rs.500/- without chequebook facility) and earn interest at 4% (w.e.f 03/05/2011)
per annum.
Term Deposits
Invest a lump sum amount for a specific period from 15 days upto 120 months and collect
interest at monthly (discounted), quarterly, half- yearly or yearly intervals.
Reinvestment Deposits

Your investment and interest for the specified period will be paid together at the end of the
term. It gives you the highest yield of interest on your savings taking care of your future
needs like marriage, house construction, children’s higher education, etc., Period can be from
6 months up to 10 years.
Recurring Deposits
Save bit by bit. Spend when the need is big and relax. Minimum monthly instalment is
Rs.100/- and is accepted in multiples of Rs.10/- thereafter. Deposits are accepted from 12
months to 120 months.
Harsh Deposits
Save with pleasure at your convenience. No penalty on your irregular remittance. You may
enhance your instalment upto 10 times your initial deposit. An ideal deposit scheme for all,
whose income is flexible and also for the salaried who may have to incur unexpected
expenditure.
Forex Services
India being one of the fastest growing countries in Asia, offers unique opportunities to non-
resident Indians for investments in India. One such avenue is to deposit funds with the banks
and State Bank of Mysore welcomes you for placing your deposits with us. Located at
strategic places all over the country with a network of correspondents all over the world,
State Bank of Mysore provides you with all types of banking services to suit all needs and
offers several specially designed schemes for non-residents.
Given below are a list of NRI Services offered by SBM
NRI Services - NRI Deposits
Preform for foreign currency remittances
Account opening form for non-resident Indians
Interest rates on NRE Deposits and schemes
Details of our correspondent Banks
Money Transfer to India Through Western Union

Remittance facility through State Bank of India, New York Branch
Remittance to India -Global Link Service (GLS)
Forex Exchange facility for Residents - FAQs
USA Patriot Act
Reserve Bank of India vide its circular at. December 8, 2003 has permitted banks to include Indian
students studying abroad as Non-resident Indians (NRIs). As Non-residents, they will in any case
be eligible for receiving remittances from India, as following:
Up to USD 100,000 from close relatives from India on self-declaration towards maintenance,
which would include remittances towards their studies also
All other facilities available to NRIs under FEMA
Educational and other loans availed of by students as resident in India which can be allowed to
continue as per provisions of Notification No. 4/2000-RB dated May 3, 2000.
Reserve Bank of India has also clarified that the above instructions do not dilute in
any way the utilisation of the existing foreign exchange remittance facilities to students in
regard to their academic pursuit.

CHAPTER 3
Over view of demonetization
3.1 Meaning
3.2 Advantages and disadvantages
3.3 Importance
3.4 Benefits
3.5 limitations

Chapter III
Over view of demonetization
3.1) Definition of demonetization:-
Demonetization is the act of striping a currency unit of its status as legal

tender. Demonetization is necessary whenever there is a change of national currency. The old
unit of currency must be retired and replaced with a new currency unit.
3.2) Objectives of demonetization
1) Fake specified bank notes were largely in circulation & it was difficult to identify
genuine bank notes from the fake ones & that the use of fake currency notes was causing
adverse effect to the economy.
2) High denomination bank notes were for storage of unaccounted wealth as evident
from the large cash recoveries made by law enforcement agencies;
3) Fake currency was causing damage to the economy & security of the country by
financing subversive activities such as dray trafficking & terrorism.
4) It is truly a cashless society. No one has cash now, under what law & authority can
the government impose a ceiling on withdrawal of cash by citizens.
5) The government claims that it is a surgical strike against black money.
3.3) what was the reason
The reasoning given below
1) To tackle black money in the economy.

2) To lower the cash circulation in the country which “is directly related to corruption in
our country”, according to pm modi.
3) To eliminate fake currency and dodgy funds which have more than Rs 5lakhcrore
black money from the economy, according to baba ramdev, a stauchmodisupporter
3.4. A) Advantages of demonetization:-

1) The biggest advantage of demonetization is that it helps the government to track
people who are having large sums of unaccounted cash or cash on which no income tax has
been paid because many people who earn black money keep that money as cash in their
houses or in some secret place which is very difficult to find and when demonetization
happens all that cash is of no value and such people have two accounts and pay taxes on such
amount & second option is to let the value of that cash reduced to zero.
2) Since black money is used for illegal activities like terrorism funding, gambling,
money laundering and also inflating the price of major assets classes like real estate, gold and
due to demonetization all such activities will take years for people to generate that amount of
black money again and hence in a way it helps in putting an end this circle of people doing
illegal activities to earn black money and using that black money to do more illegal activities.
3.4. B) Disadvantages of demonetization:-
1) The biggest disadvantage of demonetization is that once people in the country gets to
know about it than initially for few days there is chaos and frenzy among public as
everybody wants to get rid of demonetized notes which in turn sometimes can lead to law
and order problem and chaotic situation especially in banks and ATMs which are the only
medium to change the old currency units to new currency units.
2) Another disadvantage is that destruction of old currency units and printing of new
currency units involve costs which has to be higher than benefits then there is no use of
demonetization.
3) Another problem is that majority of times this move is targeted to towards black
money but if people have not kept cash as their black money and rotated or used that

money in other asset classes like real estate, gold and so on then there is no guarantee that
demonetization will help in catching corrupt people.
As one can see from the above that demonetization has both advantages and
disadvantages and it is up to the government to see and analze all the pros and cons and then
decide whether it is beneficial to go ahead with demonetization or not.
3.5) Limitations of demonetization
The bold move taken by the government on 9th Nov for the demonetization of 500 and 1000
rupee notes is a welcome initiative by most of the people across the country. On the large
scale, this move is a welcomed by and large with the exception of some inconvenience faced
by the common people. While, there are multiple benefits because of this act, there are some
sectors, which are going to take a hard hit over the demonetization of 500 and 1000 rupee
notes.
Loans and lending activity of Banks
When we talk about what effect the demonetization will have on bank interest rates for home
loans, personal loans, business loans and other such loans, the things must be analyzed in a
different manner. Let’s take people have a lot of cash being kept in their homes and other
such places. Because of this monetization, people are forced to deposit this money and
exchange those notes through various banks, thus forcing them to furnish all details related to
the cash. In a way, this process will increase the bank’s deposits by a huge margin and thus
banks have more CRR, i.e., Cash to Reserve ratio, to maintain and with more deposits they
can increase the lending activity all over the country. With this increase in the lending
activity, the loans are expected to become easier and interest rates will go down; resulting in
the easy loans, will increase the broad money supply and thus creating inflation. However,
this is going to happen slowly and take a considerable amount of time.
Since, different kinds of loans are, one way or another, connected to the real estate and
education, there are the loan types like Home Loans, which can see the direct effect on real
estate. Since the Real estate is going to experience a hard hit over the demonetization of 500
and 1000 rupees, the property prices for the properties will see a downfall and this downfall
will be around 20% to 30%. Owing to the decrease in the pricing in the properties, those
people who are looking to buy a property through Home loans will be motivated in a way and
thus, buying of homes with the help of home loans will increase in upcoming days. However,

one must keep in mind that the demand of home loans will go down for a short time for lack
of ‘cash fund’, but as the market will settle gradually.
The other types of loans like Education loans, Personal loans and Business loans will be
greatly impacted. All startups that are looking for the business loans can get the business
loans easily and at the lower rates of interest. Thus, with the easy loan availability, the
startups will grow in huge numbers and people will look motivated towards starting their own
venture.
There are both positive and negative perspectives about the demonetization. While, there are
phases where people may face troubles for some time, the advantages are greater in the long
term.
Over the country. With this increase in the lending activity, the loans are expected to become
easier and interest rates will go down; resulting in the easy loans, will increase the broad
money supply and thus creating inflation. However, this is going to happen slowly and take a
considerable amount of time.
Since, different kinds of loans are, one way or another, connected to the real estate
and education, there are the loan types like Home Loans, which can see the direct effect on
real estate. Since the Real estate is going to experience a hard hit over the demonetization of
500 and 1000 rupees, the property prices for the properties will see a downfall and this
downfall will be around 20% to 30%. Owing to the decrease in the pricing in the properties,
those people who are looking to buy a property through Home loans will be motivated in a
way and thus, buying of homes with the help of home loans will increase in upcoming days.
However, one must keep in mind that the demand of home loans will go down for a short
time for lack of ‘cash fund’, but as the market will settle gradually.
The other types of loans like Education loans, Personal loans and Business loans will
be greatly impacted. All startups that are looking for the business loans can get the business
loans easily and at the lower rates of interest. Thus, with the easy loan availability, the
startups will grow in huge numbers and people will look motivated towards starting their own
venture.

There are both positive and negative perspectives about the demonetization. While,
there are phases where people may face troubles for some time, the advantages are greater in
the long term.
There are both positive and negative perspectives about the demonetization. While,
there are phases where people may face troubles for some time, the advantages are greater in
the long term.
3.6) Important of impact of demonetization of loans and deposits.

Well, to dig deeper into this situation we have compiled a list of possible outcomes of
this decision. These are the outcomes that will have a lasting effect on our economy in the
long run, so please read on.
1) Impact on money supply, short term and long term :-

With the older 500and 1000 rupees notes being scrapped, until the new
500 and 2000 rupees notes get widely circulated in the market, money supply is expected to
reduce in the short run. To the extent that black money (which is not counterfeit) does not re-
enter the system, reserve money and hence money supply will decrease permanently.
However gradually as the new notes get circulated in the market & the mismatch gets
corrected, money supply will pick up.
2) Impact on banks :-
Since, the 500 & 1000ruppe notes which now cease to be legal tender are to be
deposited or exchanged in banks ( subject to certain limits).this will automatically lead to
more amounts being deposited in savings and current account of commercial banks this in
turn will enhance the liquidity position of the banks, which can be utilized further for lending
purposes. This will definitely enhance the cash flow for the bank & market both.
3) Impact on demand :-
Now that we have seen the impact on prices due to changing demand, the overall
demand is expected to be affected to an extent. The demand in following areas is to be
impacted.
Particularly for sectors like consumer goods, real estate and property, gold and luxury
goods where people used to use cash for transitions.
Benefits for impact of demonetization

1) Boost deposit based and savings:-

Global agencies have pegged the size of the parallel economy in India at close to 23%
as of 2017. Basis this, we estimate unaccounted cash in the economy to the tune of Rs 4500
billion. Of which a certain significant proportion will make its way to the banks, thus
boosting deposits base as well as financial savings
 The banks deposit base is expected to receive a fillip of 0.5-1.4% of GDP.
 In turn, financing to this savings can be expected to rise by to this proportion due to
switch from unproductive physical assets to financial assets.
2) Improve monetary transmission and reduce lending rates:-
 A rise in deposit base will allow banks to lower the blended cost of funds as higher
CASA (current accounts, savings accounts) deposits help to replace the high cost of
borrowing and lower overall cost of funds. We expect banks to reduce deposit rates by-125
bps over the next six months.
3) Create from for further monetary accommodation :-
 With improved monetary transmission. Economic efficiency and structural
moderation in currency in circulation, there is likely to be a greater room for the RBI to ease
monetary policy rate further. Hopefully that the RBI will ease by another 100 bps in 2017-
18,to a repo rate of 4% by march 2018.
 The piecemeal liquidity support from purchases will now to a larger extent be
addressed by the structural change in currency demand.

CHAPTER 4
4.1 Data analysis

4.2 Interpretation
4.3 Charts

Chapter IV
Data analysis
TABLE 4.1) SHOWING OF DEPOSITS AND ADVANCES OF EACH

MONTH:-
Month Deposits (crores) Advances (crores)
August 124.84 285.50
Source of data: - Annual reports

Deposits &advances of each month

300
250
200
august
150
100
50
0
deposits advances
Interpretation:-
From the above table shows that the advances and deposits of before demonetization
deposits are 124.84crore and advances is 285.50crore. The advances are more on the
deposits.
Table 4.2 showing advancesand deposits.
Month Deposits(crores) Advances(crores)
September 131.47 31.71

Deposits& advances of each month

140
120
100
september
80
60
40
20
0
deposist advances
Interpretation :-
The table shows that the before demonetization the deposits are increase of 131.47crore of
in September of 2016. And advances are decrease of 31.71crore.
Table 4.3 showing advancesand deposits.
Month Deposits(crores) Advances(crores)
October 126.08 39.49

Deposits &advances of each month

140
120
100
80 Column2
60
40
20
0
deposits advances
Interpretation:-
The before demonetization of October the decrease in the advances of 39.49crore,

the deposits are increase the 126.08crore of 2016.
Table4.4 shows the after demonetization of loans and deposits of

SBM Bank.
Month Deposit(crores) Advances(crores)

November 155.20 285.50
Source of data: -Annual reports
After demonetization of advances & deposits

300
250
200
novem
ber
150
100
50
0
deposits advances
Interpretation:-
The after demonetization the deposits is 155.20crore, and advances is 285.50crores
in the November of 2016. The advances are increase in 34.26% of in November .
Table 4.4(a) shows the after demonetization of loans and deposits
Month Deposits (crores) Advances(crores)

December 146.65 30.32

Source: Annual reports
After demonetization of advances &deposits

160
140
120
100 december
80
60
40
20
0
deposits advances
Interpretation:-
The table shows the after demonetization the deposits are 146.65crore, and
advances are 30.32crore, in the December month of 2016. The deposits are increase in
17.60%.
Table 4.4(b) shows the after demonetization of loans and deposits
Month deposits Advances
January 1404204 315783

After demonetization of deposits & advances

1600000
1400000
1200000
1000000 january
800000
600000
400000
200000
0
deposits advances
Interpretation:-
The after demonetization the deposits and advances are changed. The deposits is
140.42crore, advances is 315.78crore, and the deposits are increased in the 16.85% in after
demonetization deposits are changed.
Table4.5shows the Average deposits of before demonetization

Months Deposits (crores)
August 124.84
September 131.47
October 126.08
Average 127.46 (382.39/3)
Averege deposits of before demonetization

134
132
130
deposits
128
126
124
122
120
august september october averege
Interpretation:-
From the above table shows that the average deposits of before demonetization, the deposits
are increased in the September month and august & October deposits are less .the average of
three months deposits is 127.46%.
Table 4.5(a) Shows Average advances of before demonetization

Months Advances (crores)
August 285.50
September 31.71
October 39.49
Average 118.9 (356.7/3)
Averege advances of before demonetization

300
250
200
advances
150
100
50
0
auguts september october averege
Interpretation:-
The above table shows that the total advance is 356% .and the average of advance of
after demonetization is 118%. In the month of august advances are increased.
Table shows 4.6 Average deposits of after demonetization

Months Deposits
November 155.20
December 146.65
January 140.42
Average 147.42(442.27/3)
Source of data: - - Annual reports
averege deposits of after demonetization

160
155
150
deposits
145
140
135
130
november december january avrege
Interpretation:-
From the table shows the increase in November month 155.50%. the total of three months
deposits is 442.27 ,the deposits are rich the banker target.
Table 4.6(a) shows Average advances of after demonetization

Months Advances (crores)

November 285.50
December 30.32
January 315.78
Average 210.53(631.6/3)
Source of data: - - Annual reports
Averege advances of after demonetization

350
300
250
advances
200
150
100
50
0
november december january averege
Interpretation:-
The after demonetization the advances are increased of 315.78 of January month .the
3months total is 631.6.

Table4.7 shows the Average deposits of before demonetization & after

demonetization
Average Deposits (crores)
Before 127.46
After 147.42
Source:- Annual reports
Averege deposits of before & after demonetization

150
145
140
dep
135
130
125
120
115
before after
-
Interpretation:-
From the above table shows that after and before demonetization the deposits are
increased in 147.42 and the deposits are increase in 17.69%.of after demonetization.

Table showes4.8 Average advances of before demonetization & after

demonetization
Average Advances
(crores)
Before 118.9
After 210.53
Averege advances of before & after demonetization

250
200
150 advances
100
50
0
before after
Interpretation:-
The before and after demonetization the deposits and advances are to be changed the
210.53after demonetization the advances are to be increased in 25.26%of advances.

CHAPTER 5
5.1 Findings & Suggestions

5.2 Conclusion
5.3 Bibliography

Chapter V
SUMMARY OF FINDINGS & SUGGESTIONS
SUMMARY OF FINDINGS
On the basis of above suggestion we find as under:
 Among the after and before demonetization the loans and deposits are increased.
 After demonetization most of the customer deposits their money in savings bank
account it create money circulation.
 Majority of barrowers who are barrowed their loans i.e.30% it leads to increase the
interest rate. And the deposits also increase the 30%.
 Major of the after demonetization all banks have provided ATMs with limited cash .
 In the demonetization all the bank ATMs are not worked in fully. There is a shortage
of money in the banks.
 At demonetization period At most 68%of customers not dissatisfied services by the

banks.
 The barrower’s opinion about rates of interest on loan on medium i.e.60%& rate of
interest on deposits also satisfactory by 64%of after demonetization.
 Regarding sanctioning of loan the process of involved availing the loan is not so
difficult. And after demonetization the lending of loans will be difficult because of shortage
money.

SUGGESTIONS
1) Problem in bankers point of view :-
Interest given on deposits is low
High interest on loans &deposits
High rate of recovery charges
Political influence on bankers
Over burden of employees because of less number of employees in branch

Delay in loan sanction
Delay in receipts & payments of cash
No guidance whenever necessary information are required in the demonetization

situation to the customers.
2) From the barrower point of view:-
Illiteracy of barrower
Lack of knowledge about the bank activities
In the demonetization period customer want urgent & quick facilities by banker
Unnecessary stress wades to the banker.

CONCLUSION:-
The study was under taken with an objective to analysis about the before and after
demonetization of loans & deposits. What type of services they are providing & what are
problems faced by the banker as well as customers have been analyzed.
In this present scenario almost the private banks are ruling the banking
sector this is because of their excellent services given by customers. Loans & deposits
provided by State Bank of Mysore, mainly the customer are not aware of the impact of
demonetization & Banking activities.

BIBLIOGRAPHY:-
NEWS PAPERS
o Business standards (November 9,16,26,on 2016)
o Economic times (November 9,29,on 2016)
o Business line (December 6,2016)
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Impact of Demonetization on Bank Loans and Deposits

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Impact of Demonetization on Bank Loans and Deposits

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IMPACT OF DEMONETIZATION ON LOANS AND DEPOSITS OF BANK

Dept. of Commerce, VSK University. Ballari. Page 1

Dept. of Commerce, VSK University. Ballari. Page 2

1.2. A) Woodford (2003)

Dept. of Commerce, VSK University. Ballari. Page 3

Dept. of Commerce, VSK University. Ballari. Page 4

1.2. I) Siddhartha Bhattacharya

Dept. of Commerce, VSK University. Ballari. Page 5

 NEED AND IMPORTANCE :-

 STATEMENT OF THE PROBLEM :-

Dept. of Commerce, VSK University. Ballari. Page 6

 SCOPE OF THE PROJECT :-

 LIMITATIONS OF THE STUDY

1) A detailed study cannot be done because of time constraints.

2) The data limited to only one bank.

Dept. of Commerce, VSK University. Ballari. Page 7

Dept. of Commerce, VSK University. Ballari. Page 8

CHAPTER 2 – Profile of the Study area

Dept. of Commerce, VSK University. Ballari. Page 9

Dept. of Commerce, VSK University. Ballari. Page 10

Dept. of Commerce, VSK University. Ballari. Page 11

Dept. of Commerce, VSK University. Ballari. Page 12

Dept. of Commerce, VSK University. Ballari. Page 13

Dept. of Commerce, VSK University. Ballari. Page 14

Dept. of Commerce, VSK University. Ballari. Page 15

Network-III, HQ- New Fax 01127021041

Interest Rates on Savings Account

Dept. of Commerce, VSK University. Ballari. Page 16

 MybankSuraksha Savings Account.

Dept. of Commerce, VSK University. Ballari. Page 17

State Bank of Mysore Internet Banking

 Knowing the balance of your account

State Bank of Mysore's Personal banking.

New Deposit Schemes

MybankSuraksha Time Deposit Account

Saral Savings Bank account (No Frills account)

SBM Tax Saver Scheme

Dept. of Commerce, VSK University. Ballari. Page 18

Savings Bank account

New Deposit Schemes

7 Available at At all Branches of the Bank.

a)Rs.5,000/- for Rural Branches

If average quarterly minimum balance is not maintained, the account

d) Free issue of Platinum International Debit Card for those who

Dept. of Commerce, VSK University. Ballari. Page 19

f) Free Accidental Insurance cover of Rs.1.00 lakh for those who do

g) Instant SMS alerts for all Gold International Card Transactions.

h) SMS alerts at a nominal fees of Rs.15/- per quarter

i) Unlimited transactions in State Bank Group ATMs,

j) Balance Certificate charges (current year)-Free

k) RTGSS/NEFT – Free – 2 per month

l) Provision of opening SB Account on line.

m) Internet Banking Facility,

n) Mobile Banking facility,

p) Daily Cash withdrawal Limit at ATMs is Rs.1,00,000/- for State

Centenary Liquid Term Deposit

Name of the Product “CENTENARY LIQUID DEPOSIT”

2 Purpose To offer a distinct Term Deposit product to High Net Worth

3 Segment all segments.

4 Eligibility Resident &Nonresident individuals, institutions, corporates and

Dept. of Commerce, VSK University. Ballari. Page 20

5 Type of account term deposit