University of Mumbai for partial completion of the degree of

Master in Commerce

Under the Faculty of Commerce

By

M.COM-SEM III

Under the Guidance of

Dr. GAJANAN WADER

Mahatma Education Society’s

Pillai College of Arts, Commerce and Science

(Autonomous)

2019-2020

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 Certificate

This is to certify that Ms/Mr SIDDHIKA D. DEVALE has worked and duly

completed her/his Project Work for the degree of Master in Commerce under

the Faculty of Commerce in the subject of Project Work Sem III and her/his project
is entitled, “A STUDY ON COMPARATIVE ANALYSIS OF CAR LOAN ” under
my supervision. I further certify that the entire work has been done by the learner
under my guidance and that no part of it has been submitted previously for any
Degree or Diploma of any University. It is her/his own work and facts reported by
her/his personal findings and investigations.

Name and Signature of Guiding Teacher

(Dr. Farhat Fatma Shaikh)

Signature of External Teacher

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 Declaration

I the undersigned Miss / Mr. SIDDHIKA D. DEVALE

here by, declare that the work embodied in this project work titled “A STUDY ON
COMPARATIVE ANALYSIS OF CAR LOAN”, forms my own
contribution to the research work carried out under the guidance of DR.
GAJANAN WADER is a result of my own research work and has not been
previously submitted to any other University for any other Degree/Diploma to this
or any other University. Wherever reference has been made to previous works of
others, it has been clearly indicated as such and included in the bibliography. I, here
by further declare that all information of this document has been obtained and
presented in accordance with academic rules and ethical conduct.

Name and Signature of Learner

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 Acknowledgment

To list who all have helped me is difficult because they are so numerous and the
depth is so enormous. I would like to acknowledge the following as being idealistic
channels and fresh dimensions in the completion of this project. I take this
opportunity to thank the University of Mumbai for giving me chance to do this
project.

I would like to thank my Principal and Coordinator DR. GAJANAN WADER for
providing the necessary facilities required for completion of this project.

I would also like to express my sincere gratitude towards my project guide DR.
GAJANAN WADER whose guidance and care made the project successful.

I would like to thank my college Library, for having provided various reference
books and magazines related to my project.

Lastly, I would like to thank each and every person who directly or indirectly
helped me in the completion of the project especially my Parents and Peers who
supported me throughout my project.

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 INDEX

CHAPTER NO. TOPIC PAGE NO.

1 INTRODUCTION

2 RESEARCH
METHODOLOGY

3 REVIEW OF
LITERATURE

4 DATA ANALYSIS,
INTERPRETATION &
PRESNTATION

5 CONCLUSION &
SUGGESTION,
BIBLIOGRAPHY

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 CHAPTER 1:
INTRODUCTION

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 1) INTRODUCTION :

Here lies a question that a person who does not have a good amount of money at particular time has no
right to see dreams? Is he not authorized to fulfill his desires on time? Should he should stop dreaming?
No, because there is a solution for these queries. Loans are available for these purposes only.

Loans are provided to people for such critical circumstances which may occur at any time. In anyone's
life a situation may come when all of sudden he may require cash. A moment when you do not want to
borrow money from you relatives. There may occur any kind of emergency when you need huge amount
of money. There are various types of loans like home loans, personal loans, student loans, business loans
etc. You can take any type of loans you need. For each and every kind of need, Loans are available with
the banks to suit him.

Personal loans are available for general loan purposes like buying a luxurious car, going for a holiday
trip, educational purposes, Home improvement, wedding ceremony, etc. Many of your desires can be
fulfilled by these loans.

Housing loans are available for personal requirements like, purchasing a home, renovating the home
etc. To start a new business you require a huge amount of money. A person willing to setup a business

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may not have that much cash which can meet out his requirements. For this business loans are available.
You can get business loans to start and well establish a new business in market.

Whatever may be the kind of loan, all have full fledged facilities. All kind of loans have their own
importance. Above all, need of money explains the importance of loan. Applying for loan is very easy.
Apply for that loan whichever is needed to you. But before applying you should go through different
lenders policies and apply for that lender which is beneficial for you. Different lenders have different
policies. If you get loan for long term with low rate of interest then it is beneficial for you. Due to
competition, lenders are trying their best to attract people by providing different schemes which in turn
is good for people.

Bank just try to study the equilibrium of the loan in a particular market at a particular time. This makes
the bank to get the perfect rate of interest for a loan. They also study what the other Bank has to offer.
This indirectly helps the common man who has different options and due to competition he will get a
cheaper loan.

In today’s competitive area a person’s desires are increasing day by day. If they have bicycle they
desire for two wheeler, if they have two wheeler they desire for four wheeler. Some people are
financially strong, who fulfill their desire for four wheeler. But some are not much financially strong,
with the introduction of new era there is also movement in economic world. In present the car is a status
symbol and has also become part of fashion, so buying a car on finance (Loan) is best alternative. Many
people are using this facility.

Today there are many finance companies and banks that are providing loan for necessary things.
These companies, banks provide many scheme to attract customer, they offer discounts and different
types of gifts on the loan. There is also competition among this companies and banks. Many attractive
schemes for advantage of customer. They reduce interest rate, reduce monthly installment by increasing
the time of installment. They reduce many formalities which a customer has to complete during getting
loan and the conditions regulations are also made easy and reduce the process time.

Banking Industry, which is basically the concern industry around which the project is constructed, is a
complex industry. Bank means a financial institution which accepts the deposits of the purpose of
lending or investment of deposit of money from the public repayable on demand or otherwise
withdrawal by cheque draft or order or otherwise.

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 An efficient financial management is becoming inevitable for every manager in today’s corporate
world from traditional aspect for reusing funds whenever needed the importance has shifted to day to
day financial decision making and problem solving. When initially the stress was on the internal analysis
of the firm, procurement of funds management of assests and allocation of capital, the present
importance shifted to decision making within the firm with the modern aspects of finance function the
responsibilities of finance manager as also encouraged. In the process of making optional decision, he
makes use of certain analytical tools in the analysis planning and control activities of the firm. Financial
analysis is an essential perquisites for making sound financial decisions. This study is intended to probe
into the management of non-forming assests in the banks.

In this project the comparative study of car loans analyze the comparison among four selected banks.
Which banks provide more facilities? Which banks provide more schemes? Which banks provides loan
at low interest rate? This research is focusing on the various schemes by various banks for providing
loans on the car.

 EXECUTIVE SUMMARY :

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 In the global growing competition, the productivity of any business concern depends upon the
behavioral aspect of customers and their perception towards various schemes. This project report
consists of various chapters on car loan beginning with introduction of bank, its product profiles,
organizational structure, research methodology, achievements and analysis and interpretation of data.

The project takes into account the awareness level about analysis of car loan

among the economy. The analysis of project has been taking into consideration by the inputs given by
various bank and its customers.

The project includes survey regarding awareness level regarding car loans among people of
lower to middle class, their investments choices, their choices for various schemes, and their knowledge
about the concepts of bank assurance. It also includes experience while working on this project our
survey concludes that if proper study is done there is huge potential in car loans.

As we know that only analysis and conclusion is not the end of the research, so it also consists of
recommendation part which is covered after a depth study of the analysis part of thesis.

In each of chapters as described further every chapter has been scheduled in manner so as to enable
reader to appreciate the contents easily. The report is supported by figures and data wherever necessary
with view to assist in developing a clear cut understanding of the topic.

I hope this report will be extremely useful for those it is meant.

 OBJECTIVES OF THE PROJECT :

o To evaluate various banks quality.
o To understand the meaning & importance of car loans.
o To study the eligibility criteria for sanctioning working of car loans to commercial & house.
o To analyze the procedure followed by banks for sanctioning loans.
o To find out various type of loan products which bank offers.
o To know the importance of loans in the life of a common man.
o To find out the documents needed by a bank for a particular loans also the tax benefits earned by
a person for taking a loan.

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 o To study the interest rates of asked by the bank for car loans.

 SELECTION OF TOPIC :

Topic selection is one of the important aspect of my project as it decides the course of action to be
followed. The topic given by my project guide was the study of comparative analysis of car loans.

To satisfy customer’s need is the mission & purpose of every business. Any nationalized bank, co-
operative bank, private sectors banks, etc. providers provide car loan services to the organization or
companies. In our economy banks are the golden sources which can help us to fulfilling our demand by
providing us financial services i.e. Loan for certain period of time than we have to repay the sum in
installments with interest so as per rule held by the banks.

Analyzing how bank finance car loan to business unit is important topic for the ,management.

 OBJECTIVE OF THE STUDY :

o To have comprehensive understanding of the organization.
 To know its product profile as well as organizational structure.
 To study why a business unit require car loan.
o What are the risk factors taken into consideration while sanctioning the proposal?
o To understand overall process of sanctioning of car loan fund to a business unit by a bank.
o They should be your short term & long term objective for your car modification & accessories
business.

 WHAT IS A LOAN?
Loan means a credit facility where the money is disbursed in the beginning, mostly in one stroke,
and later on only recoveries in the forms of installments take place in the account. Very often the
two words 'Loans' and 'Advance' are interchangeably used without observing any difference in
their meanings. But there exists a fine degree of distinction between the two words. Loan means
a credit facility where the money is disbursed in the beginning, mostly in one stroke, and later on
only recoveries in the forms of installments take place in the account. In case of 'Advance' credit
facility is availed of as and when needed and continuous debit and credit operations are made in

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 the account, within the prescribed unit. Thus, credit facilities repayable in installments are
'Loans' and credit facilities like cash credit and overdrafts are where cheque book facility is also
given 'advance'. In case of loan, except initial disbursal, no further debits are allowed baring
interests being debited by the bank. The account will have credit entries only by the way of
recovery and balance outstanding will be gradually declined. But in case of advance, cheque
book remains with the borrower and any number of debits and credits are permitted with it the
agreed limit. In banking parlance, mostly the deposits are payable on the demand including term
deposits, which too can be discounted at any time and as such 'Advance' are Preferred as
compared to 'Loans' for simple reasons that advance can be recalled on demand whilst loan will
be repaid only in installments over a long period. Although the logic of such preference is
practically not visible since the cash credit accounts are never repaid and only limits are
enhanced every year while loans are at least paid back gradually. However, traditionally banks
prefer facilities which are payable on demand. Moreover, for granting loans, other specialized
agencies like State Financial Corporation have been promoted and they don't sanction advances.

 TYPES OF LOANS :
Banks grant loans for different periods- short, medium and long & for different purposes.
Broadly, the loans granted by banks are classified as Error! Bookmark not defined.

o Short term loan:

Short term loans are granted to meet the working capital needs of the borrowers. These loans are
granted for granted less than a year. These loans are granted against the security of tangible
assets-mainly the movable assets like goods and commodities, share, debentures etc. since April,
1995 reserve Bank of India has made in mandatory for the banks to grant a portion of bank credit
to big customers in the form of loans, which may be the various maturities. The reserve Bank of
India has also permitted the banks to roll over suck loans, i.e. to extent loan for another period at
the expiry of the tenor of the first loan.
o Medium term loan & long term loan:

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 Medium & long term loans are usually called ' Term loan'. Medium terms loan are granted for
more than a year and less than three years and long term loans are granted for more than three
years and are meant for purchase of capital assets for the establishment of new units and for
expansion or diversification of an existing unit. Bank usually grants such loans together with
specialized financial institutions like Industrial Finance Corporation of India, Credit and
Investment Corporation of India etc.
o Bridge loans:
Bridge loans are essentially short term loans which are granted to industrial undertakings to meet
their urgent and essential needs during the period when formalities for availing of the term loan
sanctioned by financial institutions are being fulfilled or necessary steps are being taken to raise
funds from the capital market. These loans are granted by banks or by financial institutions
themselves and are automatically repaid out of amount of the term loan or the funds raised in the
capital market.
o Composite loan:
When a loan is granted both for buying capital assets and for working capital purposes it is called
a composite loan. Such loans are usually granted to small borrowers, such as artisans, farmers,
small industries etc.

o Consumption loan:
Though normally banks provide loans for productive purposes only, but as an exception loans
are also granted on a limited scale to meet the medical needs or the educational expenses relating
the marriages and other social ceremonies etc. of the needy persons. Such loans are called
consumption loans.

 INTRODUCTION ABOUT CAR LOAN :

A loan is a type of debt. Like all debt instruments, the loan entails a redistribution financial
assets over time, between the lender and the borrower.

In a loan, the borrower initially receives or borrows an amount of money, called principal,
from the lender, and is obligated to pay back or repay an equal amount of money to the lender at

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 a later time. Typically, the money is paid back in regular installments, or partial repayments in an
annuity, each installment is the same amount.

The loan is generally provided at a cost referred to as interest on the debt, which provides an
incentive for the lender to engage in the loan. In the legal loan, each of this obligations and
restrictions is enforced by contract, which can also place the borrower under additional
restrictions known as loan covenants. Although this article focuses on monetary loans in practice
any material object might be lent.

In 1983 the Prime minister of India, handed over the keys of first car to Mr. Harpal singh of
Delhi. Means the car market launched in India first in 1983. The Maruti udhyog became the first
Indian company to produce over one million vehicles in 1994. Any finance availed for the
purchase of buying a brand a new car is defined as a car loan.

Car loan also known as vehicle loan or a car finance. It is one of the most complex loan
product in India because the car dealers tend to mix together various cash discount offered by
manufactures or car finances in the interested offer to buyer. Due to such things the chances are
borrower may not get the best loan on car loan. The interested offered by the lender on car loan
in India may actually vary from one to another.

Since car loans based on the cars have different interest rates, it is advisable to decide on the
model and make of a car. Loans for Used car or second hand car carry a higher rate of interest as
compared to new car loans. However there are some PSU banks, which offers same rate of
interest for the used car loans as well as the new car loans. . The quantum of any auto loan can
also play a vital role in rate of interest one may get from the car financer. The lenders usually
finance 80-100 per cent of the ex-showroom cost (which excludes the octroi or local taxes levied
and insurance in different states) as a loan for new car.

The car loan has a maximum tenure of 7 years for a new car which one has to pay through
Equated Monthly Installment (EMI). The maximum tenure for used car loan is 7 years as
reduced by the age of the car. The borrower should decide on the quantum of loan required

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 before he finalizes on car loan lender. The quantum of loan will depend on the make of the car,
the amount of loan lender is willing to finance and the car loan tenure. Once the amount of
funding required is finalized for the vehicle loan, borrower should compare the best deals
available from various lenders.

The borrower should freeze on the lowest EMI offered for the same loan amount and same
tenure. Once that is done, you can negotiate with different lenders for the best deal. It is safe to
say that the majority of Indian population would like to one day, own a car.
Today, cars have become an important part of people’s lives as they use them for numerous
purposes. Because of the large population this has caused a huge demand for banks like Bajaj
Finance to give out auto loans.

Over the past two decades, the population has dramatically increased in the 11 metro cities of
India and public transport has become rather overcrowded resulting in an increase in the
purchase of private owned vehicles such as cars, bikes and scooters. It is difficult for people in
India to be able to buy a car without a car loan. Anyone looking at buying a car wants to get the
best Lending Interest Rate given that the standard of living is increasing by the day.

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  CAR LOAN :
A car loan is an amount of money taken from a lending provider to purchase a new or used
car. The individuals agree to repay the total amount of the loan along with the lending interest
rate amount to the lender (often banks) as and when required. Individuals can choose a car from
a list of models and manufacturers in India according to their annual income and budget.
Presently, a common man can fulfill his dreams of purchasing a car by getting an auto loan.
According to your requirements and financial situations, you can get auto loans from a variety of
auto financing services. These days, almost everyone has the desire to buy a car which best suits
them according to their requirements. If you are one that has the desire to have a car, then simply
fill out our form on Bank and Finance.com to get free car loan quotes. You may also want to
apply for car insurance through our site.

 BENEFITS OF CAR LOANS :

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 Auto loans have many benefits. Some of the benefits for applying for car financing loans in
India are given below:
1. People using a car for their business purpose can claim part of the interest and depreciation
charges as expenses against taxable income.
2. Monthly payments can be directly debited from your bank account.
3. If you’re paying fixed payments, the terms of the agreement allow for more accurate
budgeting and protect you against any interest rate fluctuations.

 TYPES OF CAR LOAN :

There are several different types of auto loans so that every individual will find at least one
auto loan that is able to meet their requirements.
o NEW CAR LOAN :
A new car loan is taken out to purchase new vehicles generally from dealerships. As citizens
of India are getting higher pay packages, many salaried and self-employed individuals are
looking to get their dream car.
Many individuals have the cash in hand and they prefer to purchase a new car on the spot.
This however does not apply to the majority of those falling under this category. Most people
will contact banks for information about their auto loans and look to proceed from there.
There are many banks which provide new car loans with low car loan rates in India. As the
financial market fluctuates in India, there may be an increase in the lending interest rate for new
car loans. Because of this situation, be careful when it comes to getting an auto loan and plan
according to your financial situations and position. Use our loans calculator to calculate the
amount which you will need to pay every month.

o USED CAR LOAN :

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 Used auto loans are taken by the borrower to purchase a used car from either a second hand car
dealer or an individual seller. There are a number of lending institutions which provide used car
loans in India.

Sometimes people can’t afford to buy a new car and in such cases, going for a used car is the
best option. The amount of money that you can afford per month should also be taken into
consideration in order to take the right decision for auto loans from top banks and lenders such as
ICICI, PNB, HDFC & SBI.

To get used auto loans, banks usually charge a high lending interest rate. It’s always good to
check with banks about the lending interest rate because buying a used car in India will definitely
be cheaper than purchasing a new car. The depreciation of used cars is always less than that of a
new car. In most cases the owner of a car will apply for auto insurance for the used car and the
cost of insurance will be lower. Get car loan quotes instantly by filling in your personal details in
our form.

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  FEATURES :
o Financing available for all categories of vehicles across manufacturers.
o Minimum loan amount that can be disbursed is Rs. 1 lakh.
o Loan tenure up to 5 years.
o Choice of multiple loan schemes as per your needs.
o Technology driven processes.
o Transparent processes with no hidden charges.

 ADVANTAGES :
o Maximum funding at ex-showroom price.
o Attractive schemes to suit your needs.
o Faster sanction and disbursement of loans.
o Multiple modes of repayment.
o Simple documentation process.
o Attractive Loan To Value (LTV) on your car.
o Competitive processing charges.
o Pan India branch network.
o Insurance cover available at attractive rates.

 ELIGIBILITY CRITERIA :
o Minimum age requirement: 18 years .
o Maximum age requirement: 65 years.
o Any other requirements: KYCs of borrower, co-borrower and guarantor (as per RBI guidelines).

 DOCUMENTATION :

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 o Salaried
o Self-employed
o Farmers
o Fleet

 DOCUMENTS FOR SALARIED :

Documents Salaried
Income Proof Pay slip etc of past 2 months+ ITR
Bank Statements For past 6 months
Property proof Required
Other Documents Form 16 or ITR

 ID PROOF :
Passport/ Voter’s ID / Driving License / PAN card/ Self- affidavit with photograph of customer
and signature across duly notarized.

 AGE PROOF :
Passport / Voter's ID card / Driving License / PAN card 15.

 ADDRESS PROOF :
Passport / Latest telephone bill (landline) / Latest electricity bill / Latest bank statement.

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  FEES & CHARGES:
Fees & charges are in line with market norms and as per eligibility of specific cases.

 DOCUMENT FOR SELF-EMPLOYED :

Documents Self-employed
Income Proof P&L a/c OR ITR (either of the two)
Bank Statements For past 6 months
Property Proof Required
Other Documents Business establishment proof

 ID PROOF :
Passport / Voter's ID card / Driving License / PAN card / Self-affidavit with photograph of
customer and signature across duly notarized.

 AGE PROOF:
Passport / Voter's ID card / Driving License / PAN card.

 ADDRESS PROOF :
Passport / Latest telephone bill (landline) / Latest electricity bill / Latest bank statement.

 FEES & CHARGES :

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 Fees & charges are in line with market norms and as per eligibility of specific cases.

 DOCUMENT FOR FARMER :

Documents Farmer
Income Proof As per submissions made at time of FI
Other Documents Agricultural land document

 ID PROOF :

Passport / Voter's ID card / Driving License / PAN card / Self-affidavit with photograph of customer
and signature across duly notarized.

 AGE PROOF :

Passport / Voter's ID card / Driving License / PAN card.

 ADDRESS PROOF:

Passport / Latest telephone bill (landline) / Latest electricity bill / Latest bank statement.

 FEES & CHARGES :

Fees & charges are in line with market norms and as per eligibility of specific cases.

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  DOCUMENT FOR FLEET (all India tourist permit vehicle) :

Documents Fleet(all India tourist permit vehicle)

Income Proof ITR
Other Documents Commercial DL/Contract copy

 ID PROOF :

Passport / Voter's ID card / Driving License / PAN card / Self-affidavit with photograph of customer
and signature across duly notarized.

 AGE PROOF :

Passport / Voter's ID card / Driving License / PAN card.

 ADDRESS PROOF :

Passport / Latest telephone bill (landline) / Latest electricity bill / Latest bank statement.

 FEES & CHARGES :

Fees & charges are in line with market norms and as per eligibility of specific cases.

 PROCESS :
o Know your customer (KYC)

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 o Application form
o Filling of all requirement document
o Log in
o Pre screening
o Data entry
o Check CIBIL
o TV Verification
o Field investigation
o Approval / Non approval of loan
o Punch in (Disbursement) of file
o Sending to main office M

MAJOR PLAYER OF CAR LOAN

SBI BANK

 CAR LOAN OVERVIEW :

o PURPOSE :
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 Finance for :

 A new car, jeep or Multi Utility Vehicles (MUVs).

 A used car / jeep (not more than 5 years old). (Any make or model).
 Takeover of existing loan from other Bank/Financial institution (Conditions apply).

 ELIGIBILITY :
 To avail an SBI Car Loan, you should be:
 Individual between the ages of 21-65 years of age.
 A Permanent employee of State / Central Government, Public Sector Undertaking, Private
Company or a reputed establishment.
 A Professionals or self-employed individual who is an income tax assesse or
 A Person engaged in agriculture and allied activities.
 Net Annual Income Rs. 100,000/- and above.
 Gross Annual Income.

 SALARIED:
 Net Annual Income of applicant and/or co-applicant if any, together should be Rs. 3, 00,000/.

 SELF-EMPLOYED PROFESSIONALS &

PROPRIETARY/PARTNERSHIP FIRMS :
 Net Profit or Gross Taxable income of Rs. 4, 00,000/- p.a. (income of co-applicant can be
clubbed together).

 AGRICULTURAL :
 Net Annual income of applicant and/or co applicant together to be Rs. 4, 00,000/

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  SALIENT FEATURES:
 Loan Amount :

There is no upper limit for the amount of a car loan. A maximum loan amount of 2.5 times the net
annual income can be sanctioned. If married, your spouse's income could also be considered provided
the spouse becomes a co-borrower in the loan. The loan amount includes finance for one-time road tax,
registration and insurance.

No ceiling on the loan amount for new cars. Loan amount for used car is subject to a maximum limit of
Rs. 15 lakh.

 For Salaried: The maximum loan amount is 48 times of the Net Monthly Income.
 For Self-employed, professionals and Proprietary/Partnership Firms: Up to 4
times Net Profit or Gross Taxable income as per ITR after adding back depreciation and
repayment of all existing loans.
 For Agriculturist: Up to 3 times of Net Annual Income.

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  TYPE OF LOAN :
o Term Loan.
o Overdraft.
 For New vehicles only.
 Minimum loan amount: Rs. 3 Lakh.

 DOCUMENTS REQUIRED :

Need to submit the following documents along with the completed application form if you are an
existing account holder :

o Statement of Bank account of the borrower for last 12 months.

o 2 passport size photographs of borrower(s).
o Signature identification from bankers of borrower(s).
o A copy of passport /voters ID card/PAN card.
o Proof of residence.
o Latest salary-slip showing all deductions.

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 o I.T. Returns/Form 16: 2 years for salaried employees and 3 years for professional/self-
employed/businessmen duly accepted by the ITO wherever applicable to be submitted.
o Proof of official address for non-salaried individuals.

If you are not an account holder you would also need to furnish documents that establish your identity
and give proof of residence.

 MARGIN :

New / Used vehicles: 15% of the on the road price.

 REPAYMENT :

You enjoy the longest repayment period in the industry with us.

o Repayment period :
 For Salaried :Maximum of 84 months
 For Self-employed & Professionals :Maximum 60 months
o Repayment period for used vehicles :Up to 84 months from the date of original purchase of the
vehicle (subject to maximum tenure as above).

 PREPAYMENT PENALTY :

Prepayment fee of 2% of the amount of the loan prepaid will be levied subject to certain conditions:-

ATTRACTIVE FEATURES :

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 Interest Rate 10.45%

Present EMI 1683 ( per lakh for 7 year period )

Processing Fee 500/- per car loan application

Prepayment Penalty Not chargeable

Other Charges No such charge

Margin 15% on the road

Maximum period of loan 7 year

Any advance EMI recovery NIL

ICICI BANK

 CAR LOAN OVERVIEW :

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 Turn your dream into reality. Own that new car you have always desired, with a little help from us.
We offer car loans up to 90% of the ex-showroom price of the car. Our interest rates would
pleasantly surprise you. What's more, you can take up to 7 years to repay the loan.

 PICK CHOICE OF CAR LOAN :

o Loan on the Strength of Your Income: Submit income proofs as required and avail finance up
to 90% of the ex-showroom price of the car.
o Car Loans with Fixed Interest Rates: ICICI Bank offers new car loans with fixed rate option
only.

CAR LOAN ELIGIBILITY CRITERIA :

Particulars Salaried Self-Employed Partnership Private /

Individual Individual Firm Public Ltd Co.
The applicant Any proprietor, Limited
should be above partner, companies should
25 years old at the professional or have been in
Age Criteria* time of director above 28 _ existence for at
application, and years but below 65 least 3 years
up to 58 years of years at the time
age at the time of of the loan
maturity of the maturity.
loan.
Firm should have Minimum PAT
Gross annual Gross annual a minimum PAT (profit after tax) of
Income Criteria* income of at least income of at least (profit after tax) of Rs. 2.00 lakh

30 | P a g e
 Rs. 2.50 lakh Rs. 2.00 lakh Rs. 2.00 lakh Business income
Business income as per ITR or
as per ITR or Profit as per P/L.
Profit as per P/L
The total
Stability employment Current business Current business
stability should be stability should be stability should be _
more than 2 years 2 years or total 2 years or total
and current more than 3 years. more than 3 years.
employment
stability of
minimum 1 year.

 CAR LOAN INTEREST RATE :

ICICI Bank offers new car loans with fixed interest rate. In fixed interest rate, the interest rate on
the car loan will remain fixed during the tenure of the loan.

o New Car :

10.75% to 15.00% depending on the segment of vehicle and tenure selected.

o Pre-Owned Car :
13.75% to 17.00% depending on the segment of vehicle.

Tenure of credit Up to 23 months 24-35 months 36-84 months

facility
Type of credit facility Rate of Interest
New Car Loans 12.75% to 15.00% 12.2% to 14.50% 10.75% to 12.50%
Pre-Owned Car 13.75% to 17.00%
Loans

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 Special interest rate applicable to the customer would be depend on segment, asset category and
location. Stamp duty charge shall be extra as applicable .additional documentation charges of
Rs.350/- applicable ICICI Bank reserves the right to revise the rate of interest and processing fee
from time to time at its sole discretion.

 LOAN AMOUNT :
o Factors affecting your Car Loan Amount :

Car Loans from ICICI Bank are extremely convenient, flexible and quick. With more than 604
channel partners in over 1000 locations, we reach out to millions of customers and help them realize
their dream of possessing a car.

The minimum loan amount for taking a new car loan is Rs. 1, 00,000. The maximum loan
amount will depend upon the price of the car, model variant, profile of the customer, etc.

 New car :
o We finance up to 90% of the ex-showroom price of the car.
o The Loan amount also depends on the car model. Higher loan amounts are available under
specific enhanced income eligibility criteria.

 Service Charges :
o If you are looking for flexible schemes, quick processing of your loans, attractive interest
rates at the click of a mouse, then your search ends here. ICICI Bank Car Loans is the Most

32 | P a g e
 Preferred Financier for car loans in the country and offers you all the above with
unbelievable ease.

o Our car loan interest charges differ according to the car model, the tenure of the loan, the
customer and his location.

 DOCUMENTATION :

At ICICI Bank Car Loans, we offer the most convenient, flexible &quick car loan at the click of a
mouse. Keeping your convenience in mind, we ask you for minimal mandatory documents for the
sanctioning of your car loan.

 Income proof:
o Salaried individuals:
Latest Salary Slip and 2 years Form 16/ Income tax returns.
o Self-Employed individuals:

Income Tax Returns of 2 previous financial years.

o Partnership Firms, Societies & Companies:

Income Tax returns of 2 previous financial years along with complete financial/audit report.

 Documents supporting customer information:

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Identity Proof, Signature Proof, Recent passport size colour photograph and Address Proof as per ICICI
Banks norms (Our representative will help you choose suitable documents).

 Other documents:
o Partnership Firms:

Partnership deed and Letter signed by all partners authorizing one partner to execute the required Car
Loans documentation.

o Societies and Companies:

Resolution by Board of Directors (or such managing body) & Memorandum & Articles of Association
(or Society/Trust deed).

Our representative will help you with the formats of documents and the information required.

 APPLICATION PROCESS OF YOUR CAR LOAN :

o Car Loans from ICICI Bank are extremely convenient, flexible and quick.

o Keep It Simple and Swift. That's the idea behind the easy and quick application process of ICICI
Bank Car Loans. We have multiple channels for you to access our car loan services.

 CAR LOANS :
o Our representative will meet you at your convenience to assist you with the documentation and
other terms.
o The loan will be disbursed within one day of submitting all the required post-sanction
documents.
o If the vehicle is readily available with the dealer, you can get your car as soon as the disbursal is
made to the dealer. However ICICI Bank is in no way responsible for car deliveries as they are
regulated by the car manufacturer's delivery schedules.

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 o You can retain the original Registration Certificate, Invoice and the Insurance Policy. We
simply require a photocopy of these documents within 30 days of getting your loan
disbursement.
o If you wish to cancel your loan application any time before the loan is disbursed, you may do so
by informing the representative who has collected your documents or send us a written request.
o You may contact the nearest ICICI Bank branch for the best deal available on the car of your
choice. We have an extensive network of associates offering our loan products too.

 REPAYMENT TERMS OF YOUR CAR LOAN :

ICICI Bank Car Loans offers flexible schemes, attractive interest rates, and quick & hassle-free
application process at the click of a mouse. At the same time, we ensure that the repayment terms are
equally convenient for you. ICICI Bank offers new car loans with fixed interest rate. In Fixed interest
rate, the interest rate on the car loan will remain fixed during the tenure of the loan.

 CAR LOANS :
o Repayment tenure ranges from 1 year to 7 years for new car loans.
o You may change the tenure of the loan before the loan is disbursed. The interest rate & EMI
would change accordingly.
o The repayment due dates for the loan are 1st and 15thof every month and would depend on the
date of disbursement. Payment due dates cannot be changed.
o You can make the Payments through post-dated cheques (PDCs)
o Repayment option through Direct Debit Mandates is also available for all ICICI Bank account
holders.
o Option of repaying through ECS is also available in select cities.
o Payments through cash or credit cards are not accepted.

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 o You may change the PDC's in case your Bank Account is changed. However, we would require
verification of signatures by new banker. A nominal fee of Rs.500/- (Swap Charges) would be
charged for exchange of cheques.
o A full pre-payment of the loan is accepted. Part pre-payment is not allowed.

NOTE: All charges are subject to Service Tax as applicable.

 EMI Calculation made easy

We, at ICICI Bank Car Loans, strive to assist you in every possible way at every step. We have provided
some useful tools below that will help you in deciding your Car Loan.

 Fixed Interest Rate Loan EMI Calculator

Under the Fixed Interest Rate option for Car Loan the interest rate for your loan will remain
constant throughout the tenure of the loan. The contracted installment amount and interest rate
will be applicable for the full tenure of the loan.

PNB BANK

36 | P a g e
  CAR FINANCE :
o Available for purchase of New Car/ Van/ Jeep/ Multi Utility Vehicle (MUV)/ Sports Utility
Vehicle (SUV) or for old vehicles that are not older than 3 years (Depreciation @ 15% p.a. on
current invoice / showroom invoice). Finance will be provided for purchase of vehicle of
indigenous/ foreign makes.
 ELIGIBILITY :
o Individuals as well as Business Concerns (Corporate or non-corporate). Minimum net monthly
salary / pension / income – 20000/-. Income of spouse /Parent can be added.

 AMOUNT OF LOAN :
o For Individuals / Proprietorship Concerns:
 25 times of the monthly net salary OR Rs.25 lakh (for one or more vehicles), whichever
is lower. Income of parent(s) / spouse can be taken into account for determining loan
amount. In such cases, the parent(s)/ spouse shall stand as additional guarantor.
o For Business Concerns (Corporate or non-corporate):
 No ceiling on loan amount (for one or more vehicles).

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  MARGIN :
o For New Vehicles: 15%
o For Old Vehicles: 30%
o Under Tie-up Arrangement: 10%

 SECURITY :
o The vehicle purchased with the amount of loan is to be hypothecated to the Bank. It will be
registered in the name of the borrower jointly with the Bank.

 GUARANTEE/ COLLATERAL SECURITY :

o Third party guarantee / collateral security is waived in following cases:
 Permanent Employees of Central Govt. /State Govt. /PSUs/ MNCs/ Listed Companies
at NSE/ BSE who Shares are actively traded and quoted above par.

 For other than salaried class borrowers where ex – showroom cost of the car is
exceeding Rs.6 lakh.

o However the Guarantee of Parent(s) / Spouse will be taken in case their income has been
considered for determining loan amount.

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  RATE OF INTEREST :

Car Loan - - -
- BPLR System Base rate system -
Less than 3 years 3 years and above less than 3 years 3 years and above
10.50 11% BR+1% BR+1.50%

Car loan was fixed rate loan. New car loan will be floating i.e. to be changed with change in
BR. The old car loans will be mandatorily migrated to base rate system on the reset date.
@@ Base Rate+0.50% to individual borrowers where PNB Score is 60 & above During
Festival Bonanza interest @ BR +0.40 i.e. 10.65 % (Fixed) with reset clause of 3 years.

 REPAYMENT :
 For New Vehicle:

The loan amount together with interest is to be repaid maximum in 84 Equated Monthly Installments
(EMIs).

 For Old Vehicle:

The loan amount together with interest is to be repaid maximum in 60 Equated Monthly Installments
(EMIs).

 UPFRONT FEE & DOCUMENTATION CHARGES :

o @ 1% of the loan amount, with a maximum of Rs.6, 000/- (exclusive of service tax & education
cess).

 DISBURSMENT :
39 | P a g e
 The intending borrower will be required to settle the transaction for purchase of vehicle needed
by him/her with the seller and will be required to deposit the difference of the cost of the vehicle
to amount of loan, and thereafter, the advance will be allowed to him/her from the bank by
paying the entire price of the vehicle to the seller directly on behalf of the borrower.

HDFC

40 | P a g e
 Our Car Loan offers a convenient car buying experience with faster approval and doorstep
service.

We offer Car Loans for the entire range of private cars and multi-utility vehicles. Drive home in
your dream car with an HDFC Bank Car Loan, one of the leading car finance providers in India.

 FEATURES :
o Loan disbursal in 2 days.
o Fixed interest rate and No Income Document Scheme.
o Up to 100% funding and 0.5% lower rate.
o Up to 7 years tenure.

 BENEFITS :

41 | P a g e
 o Fast and hassle free loan processing.
o Stability in EMI repayment, not affected by fluctuating market rates.
o Lowest down payment and best deals for customers.
o Lower EMI.

 REASON TO TAKE NEW CAR LOAN FROM HDFC BANK :

Whatever be your need, we have a loan for you. Over the years we have won the trust of our customers
and have become market leader in loan products.

 ENJOY TRIPLE BENEFITS WHEN YOU TAKE A NEW CAR LOAN

FROM HDFC BANK:
o Faster loan - Our loan sanction and disbursal is one of the quickest with easy documentation and
doorstep service.
o Competitive pricing – Our loan rates and charges are very attractive.
o Transparency – Complete clarity on loan process and No hidden charges. Update on status of
loan application at each stage.

HDFC Bank only offers the transparency of Fixed Reducing Rate of Interest (No Floating
Rates).

Test-driving and choosing from the ample options available to purchase a new car can be a lot of
fun. But car financing isn't! Thus, HDFC Bank simplifies and quickens the car financing process
so that you don’t waste time on any paperwork. Be it a small car, family car or sheer luxury on
wheels! Just select your preferred make and model as per your budget and requirement and
HDFC Bank’s New Car Loan will bring it to your driveway in no time.

 SOME EXCLUSIVE FEATURES & BENEFITS WITH YOUR HDFC BANK

NEW CAR LOAN :

42 | P a g e
 o Our loans cover the widest range of cars and multi-utility vehicles in India.
o You can avail up to 100% finance on your favorite car.
o We offer a flexible loan repayment tenure ranging from 12 to 84 months.
o You can borrow up to 3 - 6 times your annual income.
o We provide speedy processing - within 48 hours of documentation.
o You can repay with easy EMIs.
o You can fast rack your loan by simply choosing the plan that is right for you.
o We offer attractive interest rates.
o Our documentation is hassle-free.
o We offer special privileges for HDFC Bank customers.
o Max Loan limit Rs. 1.5 Cr.

 MECHANISM TO GET A LOAN :

Check which category you fit into first. Depending on the kind of work you do, our requirements to
give you a loan will be different.

 ABOUT A SALARIED EMPLOYEE :

This category includes salaried doctors, CAs, employees of select public and private limited
companies, government sector employees such as public sector undertakings and central, state and local
bodies.

o Minimum age for Salaried is 21 years (at time of loan application) and <=60 (at the end of the
loan tenure)
o Have had a job for at least 2 years, and a minimum of 1 year with your current employer.
o Earn at least an income of Rs. 1, 80,000 annually, including the income of your spouse/Co-
applicant.
o Have a telephone/ postpaid mobile.

 DOCUMENTS NEED TO SUBMIT :

43 | P a g e
 o Proof of Identity: Passport copy, PAN Card, Voters Id card, driving license (Laminated,
Recent, Legible)
o Income Proof: Latest salary slip with form 16.
o Address Proof: Ration card/Driving license/Voters card/passport copy/telephone bill/
electricity bill/Life insurance policy PAN Card.
o Bank Statement: Last 6 months.

 ABOUT A SELF-EMPLOYED INDIVIDUAL (Sole Proprietorship) :

This category includes self-employed sole proprietors in the business of manufacturing, trading
or services.
o Minimum age for Self Employed is 21 years (at the time of loan application) and <=65
(at the end of the loan tenure).
o Be in business for at least 2 years.
o Earn at least Rs. 60,000 per annum if you are looking to buy a standard car and at least
Rs. 1, 00,000 per annum for mid-sized and premium cars.
o Have a telephone at residence / Post Paid mobile connection.

 DOCUMENTS NEED TO SUBMIT :

o Proof of Identity: Passport copy, PAN Card, Voters Id car, driving license
(Laminated, Recent, Legible) .
o Income Proof: Latest ITR.

o Address Proof: Ration card/Driving license/Voters card/passport

copy/telephone bill/ electricity bill/Life insurance policy PAN Card.
o Bank Statement: Last 6 months.

44 | P a g e
  ABOUT SELF-EMPLOYED (Partnership Firms) :

This category includes self-employed partners in the business of manufacturing, trading or services.

o Earn at least Rs. 60,000 per annum if you are looking to buy a standard car and at least Rs. 1,
50,000 lakh p.a. for car loan.
o Have a minimum turnover of Rs. 4, 50,000 per annum.
o Have a landline at your office and residence.

 DOCUMENTS NEED TO SUBMIT :

o Proof of Identity: NA.

o Income Proof: Audited balance sheet, Profit & Loss Account for latest two years and
the latest 2 years IT returns of the company.
o Address Proof: Telephone Bill/Electricity Bill/Shop & Establishment Act
certificate/SSI registered certificate/Sales Tax certificate.
o Bank Statement: Last 6 months.

 ABOUT SELF-EMPLOYED (Private Limited Companies) :

Own a private company in the business of manufacturing, trading or services

o Earn at least Rs. 60,000 per annum if you are looking to buy a standard car and at least Rs. 1,
50,000 per annum for mid-sized and premium cars.
o Have a minimum turnover of Rs. 4, 50,000 per annum.
o Have a landline at office.

45 | P a g e
  DOCUMENTS NEED TO SUBMIT :
o Proof of Identity: NA.

o Income Proof: Audited balance sheet, Profit & Loss Account for latest two years and
the latest 2 years IT returns of the company.
o Address Proof: Telephone Bill/Electricity Bill/Shop & Establishment Act
certificate/SSI registered certificate/Sales Tax certificate.
o Bank Statement: Last 6 months.

 ABOUT SELF-EMPLOYED (Public Limited Companies) :

A director in a public limited company in the business of manufacturing, trading or services.

o Earn at least Rs. 60,000 per annum, to buy a standard car and at least Rs. 1, 50,000 per annum
for mid-sized and premium cars.
o Have a minimum turnover of Rs. 4, 50,000 per annum.
o Have a landline at office.

 DOCUMENTS NEED TO SUBMIT :

o Proof of Identity: NA.

o Income Proof: Audited balance sheet, Profit & Loss Account for latest two years.

o Address Proof: Telephone Bill/Electricity Bill/Shop & Establishment Act

certificate/SSI registered certificate/Sales Tax certificate.
o Bank Statement: Last 6 months.

46 | P a g e
 FEES & CHARGES NEW CAR LOANS
DESCRIPTION OF CHARGES
FC Charges No foreclosure allowed within 6 months
from date of availing the car loan.
6% of Principal Outstanding for
enclosures within 1 year from 7st EMI.
5% of Principal Outstanding for
preclosures within 13-24 months from
1st EMI.
3% of Principal Outstanding for
preclosures post 24 months from 1st EMI
Pre-Payment Charges ( prepayment is 5 % on the part payment amount in case
allowed only once a year ) part prepayment is within 13-24 months
from 1st EMI
3% on the part payment amount in case
part prepayment is post 24 months from
1st EMI
Part-payment is allowed subject to
completion of 12 months (i.e., Post
payment of 12 EMIs)
Part payment will be allowed twice only
At any point of time, part payment will
not increase beyond 25% of Principal
Outstanding
Stamp Duty At actual
Late Payment Penalty 2% per month
Processing fees Up to 2.5 Lakhs: Rs. 2825/-
Over Rs. 2.51 Lakhs up to 4 Lakhs: Rs.
3850/-
Over Rs. 4.01 Lakhs to 5 Lakhs: Rs.
4300/-

47 | P a g e
 Over Rs. 5.01 Lakhs up to 10 Lakhs: Rs.
4650/-
10 Lakhs plus: Rs. 5150/
Cheque swapping charges NIL
Loan cancellation / re-booking charges In the event of cancellation, interest
charges from disbursement date till
refund of disbursement amount will be
borne by the customer
Legal, Repossession & Incidental charges At actual
Duplicate no due certificate / NOC NIL
Loan Reschedulement charges Rs. 1000/-
Special NOC
NIL
CIBIL Charges (only on request) Rs. 50/-
Cheque/ ECS Return Charges Rs. 450/-
Rack interest rate 11.50% to 13.75% depending on the
segment of vehicle

o Inter State NOC

o Refundable Fixed Deposit of Rs. 5000 will be charged. It will be the
borrower's responsibility to provide the transferred Registration
certificate to the bank.
o It is also advised, that the customers should refrain from any dealings in
cash with the Bank's Direct Sales associates. Borrowers should also not
make any payments in cash/bearer cheque or kind in connection with the
loan, to the executive, dealing with the borrower for purpose of the loan.

48 | P a g e
 SEGMENTATION OF CAR

SMALL MID SIZE EXECUTIVE PREMIUM D+LUXURY SUV

CAR
Alto 800 I-20 Toyota corolla Honda accord Mercedes CR-v
(Maruti)
Indica (Tata) Swift Honda civic Camry BMW Endeavour
Santro Accent Skoda Hyundai Audi Pajero
(Hyundai) Sonata
Getz Swift desire Octavia Jetta Porsche Duster
A-star Honda city Hyundai Elantra Fiat 500 Fortuner
(Maruti)
I-10 Honda jazz
(Hyundai)
Verna
Sx4
Ikon

49 | P a g e
 CHAPTER 2 :
RESEARCH
METHODOLOGY

2) RESEARCH METHODOLOGY :

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Research is a common way to generate information from primary sources can also define research as
scientific & diplomatic search for pertinent information on specific topic. It is the systematic, collection
analysis & reporting of data & finding relevant to specific situation. Research methodology is a frame
work, a blue print or the research study which guides the collection & analysis of data.

Research in common parlance refers to a search of knowledge .One can also define research as a
scientific and systematic search for pertinent information on a specific topic. In fact research is an art of
scientific investigation. Another meaning of research is "a careful investigation or inquiry especially
through of new facts in any branch of knowledge". Project method gives guidelines about how the data
is collected and the presentation at information. It must be collected with the help of some technique.
Redman and Mory define research as a "systemized effort to gain new knowledge". Some people
consider it as a movement, a movement from the known to unknown it is actually a voyage of discovery.

 OBJECTIVES :
To collect those information which are required to customers who want to borrow car loans from
different banks and finance company. So I collected information about schemes and facilities on
loan which are provided by banks and finance company and compare among these collected
information

 PRIMARY DATA COLLECTION :

The first - hand information bearing on any research, which has been collected by the researcher, may
be called 'primary data'. Collecting various information with the help of records of bank. Primary data is
a set of questions related to the research topic was formulated. Response for each questions included in
the questionnaire has been collected from the consumer. Visit to the banks, interview with the branch
managers & staffs of the banks.

o SOURCES OF PRIMARY DATA :

51 | P a g e
  QUESTIONNAIRE :
 Close ended questions are structured once with two or more alternative responses from which
respondent can chose. They contain standardized options and they are simple to administer and
easy to compile and analyses.
 A dichotomous question can be answered in one of the two responses such as 'Yes' or 'No'. It is
necessary to realize that in many two choices question there may be potential alternative beyond
the stated two.
 Multiple choice questions :These questions contain more than two alternatives. Following points
should be remembered before making this questions.
1. The list of alternative choice should be exhaustive.
2. It should not be overlapping.
3. There should be fair balance in choice.
4. All alternatives should be reasonable.

 INTERVIEW SCHEDULE :

An interview schedule is the list containing a set of structured questions that have been prepared, to
serve as a guide for interviewers, researchers and investigators in collecting information or data about a
specific topic or issue.

 SECONDARY DATA COLLECTION :

The Secondary data on the other hand, are based on second -hand information. The data which have
been already collected, compiled and presented easier by any agency may be used for the purpose of
investigation. Such data is called as 'secondary data'. Collecting the information with the help of Annual
Reports, Magazines, Internet, and Reference book, the secondary data provided by the organization.
Secondary data: Secondary data is second hand information that was collected by me from magazines
and Websites such a data help me to understand. Books, websites, newspapers & pamphlets.

Common secondary research methods include data collection through the internet, libraries, archives,
schools and organizational reports. 
52 | P a g e
 o ONLINE DATA :

Online data is data that is gathered via the internet. In recent times, this method has become popular
because the internet provides a large pool of both free and paid research resources that can be easily
accessed with the click of a button. 

While this method simplifies the data gathering process, the researcher must take care to depend solely
on authentic sites when collecting information. In some way, the internet is a virtual aggregation for all
other sources of secondary research data. 

o DATA FROM GOVERNMENT & NON-GOVERNMENT ARCHIVES :

You can also gather useful research materials from government and non-
government archives and these archives usually contain verifiable information that
provides useful insights on varying research contexts. In many cases, you would
need to pay a sum to gain access to these data. 

The challenge, however, is that such data is not always readily available due to a number
of factors. For instance, some of these materials are described as classified information as
such, it would be difficult for researchers to have access to them. 

o DATA FROM LIBRARIES :

Research materials can also be accessed through public and private libraries. Think of a library as an
information storehouse that contains an aggregation of important information that can serve as valid data
in different research contexts. 

Typically, researchers donate several copies of dissertations to public and private libraries; especially in
cases of academic research. Also, business directories, newsletters, annual reports and other similar
documents that can serve as research data, are gathered and stored in libraries, in both soft and hard
copies. 

o DATA FROM INSTITUTIONS OF LEARNING :

53 | P a g e
Educational facilities like schools, faculties, and colleges are also a great source of secondary data;
especially in academic research. This is because a lot of research is carried out in educational institutions
more than in other sectors. 

It is relatively easier to obtain research data from educational institutions because these institutions are
committed to solving problems and expanding the body of knowledge. You can easily request research
materials from educational facilities for the purpose of a literature review. 

Secondary research methods can also be categorized into qualitative and quantitative data collection
methods. Quantitative data gathering methods include online questionnaires and surveys, reports about
trends plus statistics about different areas of a business or industry.  

Qualitative research methods include relying on previous interviews and data gathered through focus
groups which helps an organization to understand the needs of its customers and plan to fulfill these
needs. It also helps businesses to measure the level of employee satisfaction with organizational
policies. 

54 | P a g e
  RESEARCH PROCESS :

The research was carried out as per steps of consumer research process. The figures below depict a
model of consumer research process.

Step 1 : DEFINING THE OBJECTIVE OF THE RESEARCH :

The first step in consumer research is to carefully define the objective of study. The objective of study
were decided at the outset to ensure that the research design is appropriate the statement of objectives
helped to define the type and level of information needed.

Step 2 : COLLECTING AND EVALUATING THE SECONDARY DATA :

A search for secondary data generally follows the statement of objective. Secondary inform is any
data originally generated from some other purpose other than the present research objective. It includes
finding based on research done by outside organization, data generated in house for earlier studies,
details of past customer transaction and even customer information collected by the firm sale
departments like sales, call report etc. locating secondary data is called secondary research. In this
,secondary data was not available as earlier study were not carried out. This topic on a store level to
meet the objective for which primary research is undertaken.

Step 3 : DESIGNING OF PRIMARY RESEARCH STUDY :

The design of research study is based on the purpose of study. A quantitative study was undertaken
as descriptive information was needed.

Research design is the specification of procedure for collecting and analyzing the data necessary to
identify and react to a problem or opportunities such that the difference between the cost of obtaining
various levels of accuracy and expected. Value of the information associated with each level, accuracy is
maximized.

55 | P a g e
Step 4 : COLLECTING PRIMARY DATA :

The primary data is the 1st hand and fresh data which researcher collect for their research work.

Step 5: PROCCESING AND ANALYSING THE DATA :

Analyzing of data is done to built a sort of intellectual model where the relationship involved are
carefully brought out so that some meaningful interface can be drawn, it involved the presentation of
data through tables, graphs, diagrams, statistical tool used to translate responses into meaningful
information from the collected data, interference have been drawn from the analyzed data with proper
supportive data.

 SCOPE OF STUDY :

The scope of the project purely remains on the study of car loans from various banks with the view to
know the assessment of loan ,how customers can assess the loan, what are the interest rates, procedure
can be known from the study. It also analyze the defaulter in car loan in various banks so that bank can
take precaution while the granting of loans.

There is wide scope of study of car loans analysis.

 LIMITATIONS OF THE STUDY :

o Generally banks do not allow the outsiders to have any study or research work with the bank.
Therefore getting a project with a bank itself was very difficult.
o The time span was short, which itself acts as a major constraints moreover studying the
guidelines and to apply practically with short time span was a task of great pressure.
o Due to confidentiality some of the information which is important for the project could not be
collected. There was restriction is disclosing such information or data.

56 | P a g e
 CHAPTER 3 :
REVIEW OF
LITERATURE

57 | P a g e
 3) REVIEW OF LITERATURE :

Financiers when they purchase their cars. The study was based on the data Collected from the five
hundred and twenty five passenger car owners consisting of professionals, employees of public and
private sectors, businesses men and agriculturist in Dakshina Kanadda district of Karnataka State. The
respondents have been broadly categorized in three groups on the basis of original price range of their
cars viz cars in price range of RS.2-4 lakhs,RS.4-6 lakhs,RS.6-9 lakhs. The study finding indicates that
the most important three factors considered by car purchasers while deciding auto finance company
were less processing time, easy documentation and explanation of the financing scheme by the staff.

 Dr P.NATARAJAN and U.THIRIPURASUNDARI (2010) this study focuses on consumer

preferences on global brands vs local brands in the Indian car industry. Consumer brand
perceptions have substantial implications in marketing. The consumers preference towards local
and global brands is studied by administering a structured interview schedule with one hundred
and fifty customers in Pondicherry City. The findings of the study advised that the consumers
who possessed global car brands preferred their car brands due to factors such as global
presence, worldwide reputation and the quality of being imported. Consumers made favorable
perceptions on the country wherein they tend to associate factors such as superior quality,
technical advancement, modernization etc.to the country from which the brand has taken its
origin. Consumers who owned a local brand evaluated the local brand in a favorable manner,
wherein they tended to associate the brand to India's strong automobile sector making quality and
technically efficient cars.

 SUDHARANI RAVINDRAN and GAYATHRIDEVI (2010) The authors in their articles studied
the customer satisfaction of Hyundai i 10 in Coimbatore city. The research is descriptive in
nature. The sample design adopted for the study was the simple random sampling .The sample
size was one hundred which included only owner of Hyundai i 10 cars in Coimbatore city. The
customers expectations over a Hyundai i 10 was also found out (Design and style).The attributes
like suspension and handling were identified to be below par for a Hyundai i 10.

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  CLEMENT SUDHAKAR and VENKATAPATHY (2009) The study is based on the influence of
peer group in the purchase of car. It was also found that the influence of friends is higher for the
purchase of small sized and mid-sized cars.
 Dr V.K.KAUSHIK (2008)This study is conducted in South west Haryana which consists of
Bhiwani and Mahendragarh district. The study endeavor is to investigate empirically customer's
preference towards a passenger car brand. Pre-purchase and post purchase behavior of the
customers were evaluated and the factors influencing customers were determined by perpetual
mapping obtained from multi-dimensional scaling .Overall results indicate that in South west
Haryana region customers are more influenced by friends and relatives than dealers and sales
person. Maruti dominates the market with three of it's brand namely Maruti 800,Alto and
Wagon-R. Brand name, fuel efficiency and price were found to be primary determinants for
buying car in this region.

 CHIDAMBARAM and ALFRED (2007) The study postulates that there are certain factors
which influence the brand preference of customers. Within this framework, the study reveals that
customers give more importance to fuel efficiency than other factors. They believe that the brand
name tells them something about product quality, utility and technology, and they prefer to
purchase passenger cars which offer high fuel efficiency, good quality and technology,
durability, and are priced reasonably.

 A.M.SURESH (2006)This research reports and measures customer satisfaction with small cars in
Bangalore City. The research identified sales support, vehicle Design, purchase support ,cost of
ownership and delight features as underlying factors of customer satisfaction. The research tried
to rank small cars on these factors. The study also tries to find whether customer satisfaction
varies among customers on the basis of demographics.

 SUMIT JAIN (2006) The automative industry is now facing new and pressing challenges.
Globalization, individualization, digitalization and increasing competition are changing the face
of industry. In addition, increasing safety requirements and voluntary environmental

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 commitments have contributed to the changes ahead. The size of the organization is no longer a
guarantee of success. Only those companies that find new ways to create value may prosper in
the future. The purpose of this study is to present a short overview of the automotive industry
today and highlight challenges facing the industry.
 RANGANATHAN.R (2005) His study "Consumer Markets and Buyers Behavior of Cars",
argued that brand image could be increased by the advertisement which clearly showed the
features of the cars. The result of the study was the necessity was the first factor of choosing the
car and mileage was an important factor expected for the car.

 S.MURLIDHAR (2005) The research analysts, Business line, in his article "Passenger car-
Distinct signs of Maruti " said that managing costs, improving productivity and efficient
investments into research and development would be the key parameters that would determine
the competitiveness of car manufacturers, especially the home grown ones. This would come
into sharper focus for companies that attempt to go global with their products, as imports of
passenger cars in the premium sedans category become an increasingly attractive proposition.

 Dr K.CHINDABARAM et.al (2004) The researchers undertook a study on "Brand Preference on

Passenger Cars-a study with special reference to Coimbatore city in Tamil nadu" argued that the
customers gave more importance to fuel efficiency than to other factors. They believed that the
brand name was explanatory of product, quality, utility and technology. Consumers preferred to
purchase passenger cars, as they offered high fuel efficiency, good quality, technology and
durability and could be purchased at a reasonable rate.

 K.MARAN and Dr S.MADHAVI(2002) Their study "Passenger Cars-Enormous scope for

development" argued that a demand for a car was depending on many factors. The key variables
found were per capita income, new models, availability and pricing, rate of interest, finance
scheme, fuel costs, depreciation norms, public transportation facilities, duties and taxes. The first
four factors have positive relationship with demand ,whereas the others have inverse relationship
with demand.

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  RAGHUVIR SHRINIVASAN (2000) He analyzed the potential impact of the removal of
quantitative restrictions on the import of used cars on Passenger car manufacturing companies in
India. He reasoned that one could get an imported used car for around RS.3 lakhs (US $
6250),taking into account the price would be attractive to Indian buyers, service related problems
and government restrictions would be dissuading factors.
 BHUVANA RAMALINGAM (1999) The study concluded that a pragmatic approach by the
government was needed to prevent the onslaught by the import of used cars as the quantitative
restrictions ,and local content regulations were to be lifted as per the World Trade Organization
agreement.

 NARAYANAN (1998) He analyses the effects of deregulation policy on technology acquisition

and competitiveness in the Indian automobile industry during the 1980s and finds that
competitiveness has depended on the ability to build technological advantages, even in the era of
capacity-licensing. In a liberalized regime, this would depend on firm's ability to bring about
technological changes, as inferred from the behavior of the new firms in the sample considered.
Further, vertical integration could score over subcontracting in a liberal regime. This is probably
because of the entry of new foreign firms that produce technologically superior and guaranteed
quality vehicles and choose to produce more of the components in-house.

 MURUGANANDAM (1997) His study "A Consumer Brand Preference For Motor Cars In
Coimbatore City" stated that the factors that influence customers in the preference of a car were
price and design and after sales service provided by the dealer. Price and design influenced more
to buy Maruti and Ambassador Cars and further revealed that the after sales service was good.

 ARADHANA KRISHNA (1994) He views that buyers purchase behavior can be influenced not
only by the current price of a product but also what price they expect in the future .C W Park et
al (1994), assessing consumer knowledge ,have observed that consumer knowledge is an

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 important construct in understanding consumer behavior such as information search and
information processing .An increase in self-assessed knowledge was associated with the decrease
in the utilization of sales persons recommendations.

 Cars direct.com Inc. (2000) "Site will widen auto buyers inventory financing options", E-week,
October, pp.46-47

 Dr Sanjay J.Bhayani (2005) " Retail Banking Awareness. An Empirical Analysis (with special
reference to private sector banks)". Indian Journal of Marketing, Vol Xxxv, Sep, 2005 pp.27-30.

 Bobo (2007) "Impact of vehicle loan on economy", www.ebscohost.com.

 Gayathri Balakrishnan R. (2010) Customer Awareness about the Banking services - "A study",
southern economist, may issue, pp-13-16.

 S. Poornimadevi & Dr. K Sirajuddin (2016) "Borrowers Satisfaction towards Vehicle finance in
Coimbatore District", Quest International Research Journal, Vol-V, Issue-2, Feb-2016. P.No.:22-
27.

 T.M.Shankar (2016) "An Empirical study on Customer Awareness, Preference and Satisfaction
on Private Label with Special reference To ' Reliance select' in Coimbatore City" International
Journal of Engineering Research and modern Education, Vol-1, Issue-1, 2016, P.No.:494-503.

 N.Vijay Kumar & Dr.J. Shanmugananda Vadivel (2016) "A study on awareness towards Motor
vehicle Insurance based on Credit policy with reference to Coimbatore" International Journal of
current research and Modern Education, Vol-1, Issue-1, 2016 P.No.:457-462.
 www.economictimes.com
 www.mapsofindia.com

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 CHAPTER 4: DATA
ANALYSIS,
INTERPRETATION &
PRE SENTATION

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 4) DATA ANALYSIS, INTERPRETATION & PRESENTATION :

o Data interpretation and presentation

o As per loan is profitable lending option due to continued good performance of the services
sector, the bank will continue to focus on this segment. The bank will continue to study
the market requirement, evolve innovative and diversified products to reach the customers
in every nook and corner of the country. For better decision support systems, business
intelligence, management information system and decision making. The bank is in final
stage of rolling out data warehouse.
o Risk and concerns
o Liberalization opens up various opportunity and at the same time it also increase exposure
to risk. Risk management, therefore, is paramount . Since, risk have a direct and
proportional relations with returns, the bank has to clearly envisage its risk which can be
managed effectively. further risk management system needs to be brought to such a level
of sophistication that the system on their own generate adequate capital and equidity
cushions against economic and disruptions.

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  FAQ :
 What is the tenure or loan period?
 The tenure offered by most lenders is 1-5 years but in some special cases the tenure could be
extended to a maximum of 7 years. It is best to pay off the loan as quickly as possible as cars
have depreciation as time goes by and you will pay more than its cost. But if you want to reduce
the EMI then opt for the longer tenure.

 What is the interest rate? What are the types available?

 There are 2 types of interest rates the fixed and floating rate. In the fixed rate you will have a
fixed EMI which you will pay till the duration of the loan this is also safer. With the floating rate
the interest rate varies according to the economic situation and tends to change.
 The interest rate starts from 8.80% and varies from bank to bank. It will depend on your credit
score, salary, the loan amount you want and the tenure.

 What is the processing time for the car loan?

 Usually it takes banks at least a week to process and application which will include background
verification and loan amount disbursal. It may take some additional time if the bank and its
employees/agents are tied up with a lot of applications.

 Are the loan terms negotiable?

 Yes, the loan terms are negotiable. If you are taking the loan with the bank you have already
done business or the bank with whom you have your salary/savings account you can ask for
better terms as they already know about your earnings and financial capability.
 If you are going to a new lender go prepared with your credit score, salary slip and other
financial details to show that you are well off and can negotiate better terms.

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  What is the EMI cycle?
 The EMI due date or cycle is dependent on the borrower. It can be the first of the month or 5th of
the month. The borrower can choose the day as per their convenience. Some banks do give a set
day as their processing day are automated.

 Are there chances of my loan application being rejected?

 Yes, if you have a low credit score, you had defaulted on any payments, have negative remarks
like “Settled” or “written off”, salary discrepancies, problems at time of background verification
and mistakes in the application form are all reasons to have your loan application rejected. The
lender will send a rejection letter which will have all the details of the reason for rejection which
you could rectify before applying for the loan again.

 What will happen if I miss any EMI?

 It is best to pay your EMI on time. Most banks will tolerate any late payments for 1 or 2 times
and if you don’t pay your EMI at all the bank has every authority to seize the car. Furthermore if
you default on EMI your credit score will take a hit which will spoil your chances of getting any
form of credit in the future.

 Can I get a loan for used cars? What are the factors that affect the interest rate?
 Yes you can get a loan to buy used cars but the interest rate will be higher than compared to a
new car as the old car has lesser resale value.
 The factors that affect the interest rate of the car include your credit score, salary, company your
work for, where you stay (rental, own house), debt to income ratio, tenure you choose and most
important of all the age and model of the car. The age and model is important as if the car is
older it will be subjected to wear and tear. If the car is not in production then the loan rate will
increase.

 What is the loan process?

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  Enquire from Eazeeloans.com
 Submission of documents and booking amount.
 Verification agency representative visit.
 Loan approval.
 Car registration , Insurance cover ,and delivery.

 Can I make payments early without any penalty?

 This is a very important question that every borrower should ask his lenders whenever he
approaches them for a loan. Many banks levy prepayment charges, foreclosure charges and other
fee when the borrower wants to pay off his debts before the tenure ends. You should always
choose a bank that charges you the minimum in such events. Many banks do not levy foreclosure
charges after two years of the sanctioning of the loan. Those banks should be given a preference
which levy low or no foreclosure charges.

 What fees are included in the car loan?

 Apart from the interest amount, a borrower has to pay a number of charges and fee on the car
loan. You should always ask about the charges and fee applicable on the loan both at the time of
sanctioning the loan and while paying off the debt. Some of the most common charges and fee
levied on the customer are loan processing fee, documentation charges, credit report charges,
registration certificate collection charges, stamp duty, part prepayment charges, foreclosure
charges, late payment charges, amortisation schedule charges, loan cancellation charges, swap
charges, bounce charges, etc. You should compare additional fee and charges of various banks
before choosing your lender.

 What should my down payment be and for how long should a car loan be taken?
 Applicants should understand that their car loan would stay with them for some time and they
will have to pay a regular amount in EMI every month for years. Smart financial planning is the
key here. Applicants should not agree to the higher EMI amount which may put an immense
financial pressure on their daily budget in order to keep the tenure on the lower side and save on

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 interests. They should also refrain from choosing the longest tenure as it will increase the interest
payable on the loan amount. A balanced EMI with a sensible tenure that does not put excessive
pressure on earnings should be chosen.

 What is the final price I will have to pay for the vehicle?
 Even if the interest rate is low, some lenders charge borrowers heavily for processing,
documentation, prepayment, foreclosure, late charges, default in payment, etc. This increases the
overall amount paid for the car. The borrower should check the final amount that he will have to
pay over the period by using the car loan EMI calculator. You should check various aspects such
as the principal loan amount and tenure to get the lowest interest and save on your final car
amount.

 How is eligibility calculated?

 Various factors are taken into account when assessing the repayment capacity. Income , age ,
stability/ continuity of employment/ business and subject to maximum provided by the bank ,to
name some factors.

 How can eligibility be increased?

 Your spouse should be a co-applicant if he/ she is earning. The incomes can be clubbed to
enhance your loan amount.
 You can also include Parents / children as co- applicants for higher eligibility.

 Who can apply for Auto/ Car loans?

 Salaried Individuals
 Self Employed professionals /Businessmen
 Companies or firms.

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  DIFFERENT LTV (LOAN TO VALUE OF DIFFERENT BANKS) :

SR.NO. BANKS LOAN AMOUNT

1 SBI 85%
2 ICICI 90%
3 HDFC 100%
4 PNB 80%

Chart Title
120%

100%

80%

60%

40%

20%

0%
SBI ICICI HDFC PNB

Column1

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  INTEREST RATE :
Interest rate of these banks is different. They try to provide minimum interest rates so that
maximum customers can get advantage of facility.

SR.NO. BANKS INTEREST RATE

1 SBI 10.45%
2 ICICI 11.50%
3 HDFC 10.75%
4 PNB 11.20%

Chart Title
11.6

11.4

11.2

11

10.8

10.6

10.4

10.2

10

9.8
SBI ICICI HDFC PNB

Column2

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 SR.NO. BANK INTEREST
RATE
1 HDFC 15.25% 17.75% (60
months),
15.25% - 17.75% (48
months),
15.25% -17.75% (36
months),
15.75% - 18.25%
(24 months),
15.75% - 18.25%
(Upto 12 months)
Corporate Rates
13.50% - 14.25%
2 SBI 17.25% ( Upto 36
Months) 17.50%
( Above 36 months)

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 3 ICICI 13.75%-17%

 REPAYMENT PERIOD :
The period of time in which the loan is repaid.

SR.NO. BANKS MIN (in months) MAX (in months)

1 SBI 12 84
2 ICICI 12 84
3 HDFC 36 84
4 PNB 12 84

Chart Title
90

80

70

60

50

40

30

20

10

0
SBI ICICI HDFC PNB

MIN Column1

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  PROCESSING FEES & CHARGES :

SR.NO. BANKS PROCESSING FEES

1 SBI 0.51% Loan amount
2 ICICI 2500-5000
3 HDFC 2825-5150
4 PNB 1% Loan amount

 QUESTIONNAIRE :
1. Name.
2. Gender.
Male
Female
3. Which age group do you belong?

Below 30

31-40

41-50

51-60

Above 60

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 4. Which sector are you working in?

Private

Public

Other

5. Do you have a car?

Yes

No

Sales

Yes No

6. Have you taken car on loan or self-financed?

On loan

Self-financed

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 Sales

On loan Self-financed

7. Which bank do you prefer for taking loans?

SBI

ICICI

HDFC

PNB

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 Sales

SBI ICICI HDFC PNB

8. What influence you to take loans from banks?

Transparency

Lowest interest rate

Lowest EMI

Fast & simple service

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 Sales

Transparency Lowest IR Lowest EMI Fast & simple service

9. What do you feel about the services provided by various banks in advance products?
Bad
Satisfactory
Good
Excellent

Sales

Bad Satisfactory Good Excellent

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 10. What are the number of customers from which sector to buy cars and have loans for the
same?
Service sector
Business sector

Sales

Service sector Business sector

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 CHAPTER 5
:CONCLUSION

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 5) CONCLUSION :
The loan system in India has been on the verge of rising due to the change in the mindset of Indian
people , who once were afraid of taking loans as they feared what will the banks do if the money isn't
returned back. Nowadays the people in India want to increase their own standard of living even though
their financial conditions are weak. For the purpose of satisfying their dreams they contact the bank for
the loan.

After doing this project I got to know what are the documents needed for an application of the loan ,
which is a very important gain which I got from this project. Before I start this project I had very less
information of documents required.

This project has given me a lot of information related to the loan by talking to various branch
managers and staff. This has given me confidence that the future of banks in India will be very bright as
in a population of more than 1 billion needs money everyday.

o The study of project reveals that various banks were in analysis and interpretation of the project
status that the banks provide various types of car loans to the society.
o •As compared to private financial organizations banks have more efficient and valuable changed
in the facilities which are to be provided to the common people in less charge.
o •Different types of loans are provided by the banks.

 FINDINGS :
o •In today's day the deemed of money are increased because the needs of human being
have increased.
o •So the rate of interest of loan should be decreased or kept less
o •More people can afford the scheme of loan and can satisfy their needs as per their
requirement.
o •Make process of loan more easy and convenient to understand for the customers.
o •For the loan , Bank requires some documents but some people cannot have that.
o •Take a loan from Bank so the banks can provide option for documents.

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  SUGGESTIONS :
o Sector of bank should concentrate more on business sector without neglecting the service
sector.
o •As maximum number of people have given preference to 85% of amount of loan on the
total price of car , therefore bank should concentrate in this category of loan.
o •As according to survey maximum number of people are from business .
o •As maximum number of declare for used car are not willing to make tie with banks
because of commission delays. Therefore bank should make understanding with them as
solve their grievances as early as possible.
o •The loan amount should be sanctioned according to the capability of customers.

 BIBLIOGRAPHY :
OTHER SOURCES
Brochures of
ICICI Bank ,
SBI Bank,
PNB Bank ,
HDFC Bank.

WEBSITES
https://www.sbibank.com
https://www.icicibank.com
https://www.pnbbank.com
https://www.hdfcbank.com
www.economictimes.com
www.google.com
www.yahoo.com
www.scribd.com
Business Today (newspaper)
Economic Times(newspaper)

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 Financial Services (Nirali publications)
Cases in Finance (Nirali publications)

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