A

PROJECT REPORT ON
“A STUDY ON VEHICLE LOAN ACTIVITIES OF PUNJAB NATIONAL BANK”
SUBMITTED TO
THE UNIVERSITY OF MUMBAI
IN PARTIAL FULFILLMENT FOR THE AWARD

THE DEGREE OF BACHELOR IN COMMERCE (BANKING AND INSURANCE)

OF
SEMESTER VI 2018 - 2019
SUBMITTED BY
MRS. SNEHA CHANDRASHEKHAR SINGH
SEAT NO: _______________
UNDER THE GUIDANCE OF
PROF.HASIT KUMAR NAGARIYA
THE S.I.A COLLEGE OF HIGHER EDUCATION
DOMBIVLI (EAST)

1
 THE S.I.A. COLLEGE OF HIGHER
EDUCATION

Plot no. P-88, MIDC Residential zone,

Dombvli Gymkhana Road, Sagarli,

DOMBIVLI (EAST)-421203
_____________________________________________________
_______________

CERTIFICATE

This is to certify that MRS. SNEHA CHANDRASHEKHAR SINGH has worked and duly completed his
project work for the degree of Bachelor ‘s in Commerce (Banking and Insurance) under the faculty of
commerce in the subject of banking and her project is entitled, “A STUDY ON VEHICLE LOAN
ACTIVITIES OF PUNJAB NATIONAL BANK”. Under my supervision.

I further certify that the entire work has been done by learner under my guidance and that no part of it has
been submitted previously for May Degree or Diploma of any university.

It is her own work and facts reported by her personal finding and investigation.

COURSE COORDINATOR PRINCIPLE

PROJECT GUIDE

EXTERNAL EXAMINAR

2
 DECLARATION

I Am MRS. SNEHA CHANDRASHEKHAR SINGH declare that the report of the project work entitled
“A STUDY ON VEHICLE LOAN ACTIVITIES OF PUNJAB NATIONAL BANK” is based on my
own work carried out during the course of my study under the supervision of PROF.HASIT KUMAR
NAGARIYA.

I assert that the statement made and conclusions drawn are an outcome of my project work. I further declare
that to the best of my knowledge and belief that the project report does not contain any part of any work
which has been submitted for the award of any other degree/diploma certificate in this university or any
other university.

Signature of Student

(MRS SNEHA CHANDRASHEKHAR SINGH)

THE S.I.A. COLLEGE OF HIGHER EDUCATION

Plot no. P-88, MIDC Residential zone,

Dombvli Gymkhana Road, Sagarli,

DOMBVLI (EAST)-421203

3
 ACKNOWLEDGEMENT

I would like to acknowledge the following as being idealistic channels and fresh

Dimensions in the completion of the 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, Dr. Padmaja Arvind for providing the necessary facilities required for
completion of this project.

I would also like to express my sincere gratitude towards my project guide Prof. Hasit KumarNagariya.

Whose guidance and care made the project successful.

I would like to thank my college library and librarian Mrs.Bharti Rao, for having provided

Various books and magazines related to my project.

Lastly, I would like to thank each and every who directly and 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:-

SR.NO CHAPTER NAME PAGE NO

1. INTRODUCTION 6 - 21
2. RESEAR METHODOLOGY 22 - 32
3. REVIEW OF LITERATURE 33 - 34
4. DATA COLLECTION AND ANAYLISIS 35 - 45
5. CONCLUSION 46 -47
6. BIBLIOGRAPHY/REFERENCE 48
7. ANNEXURE 49 – 51

5
CHAPTER: - 1 INTRODUCTION

6
1.1 History: -

Vehicle loans first emerged in the early 1990s and opened a new market to individuals with poor credit and
have grown increasingly popular, according to studies by the Centre for Responsible Lending and Consumer
Federation of America. They are the cousin of unsecured loans, such as payday loans. Since borrowers use
their car Vehicles to secure the loans, there’s risk that the borrower can lose their vehicle by defaulting on
their payments due to personal circumstances or high interest rates, which almost always have APR in the
triple digits—what are sometimes called “balloon payments”.
Alternative Vehicle lending exist in many states known as car Vehicle
pawn or auto pawn as they are called. Similar to a traditional car Vehicle loan, a car Vehicle pawn uses both
the car Vehicle and the physical vehicle (which is usually stored by the lender) to secure the loan much like
any secured loan works, and there are the same risk and factors involved for the borrower but in most cases
they will receive more cash in the transaction since the lender has both the vehicle and Vehicle in their
possession.

The car loan officially originated in 1919, when the General Motors Corporation (an automobile
manufacturer founded in 1908 in Flint, Michigan) established the General Motors Acceptance Corporation,
or GMAC. GMAC arose in response to the growing demand for automobiles among American consumers
after World War I. In 1919 GMAC established offices in five North American cities; a year later it opened
its first office in Great Britain. As the car loan business expanded, other automobile manufacturers began to
develop their own financing divisions. One of the most prominent was the Ford Motor Credit Company,
founded in 1923. Although car loans were available most American consumers during the first half of the
twentieth century paid cash for their automobiles.

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1.2 Meaning: -

A car loan (also known as an automobile loan, or auto loan) is a sum of money a consumer borrows in order
to purchase a car. Generally speaking a loan is an amount of money that is lent to an individual, a business,
or another entity. The party that lends the money is known as the lender, while the party borrowing the
money is called the borrower. When taking out a loan a borrower agrees to pay back the full loan amount, as
well as any interest (a percentage of the loan amount, usually calculated on an annual basis), by a certain
date, typically by making monthly payments.

Car loans follow most of the same rules and procedures that apply to other loans. In most cases when
purchasing a car, a borrower will specifically apply for a car loan; however, a consumer can also use a
personal loan (a loan obtained by an individual to use at his or her discretion) for the same purpose. All car
loans are for specific lengths of time, generally anywhere between 24 and 60 months, although some car
loans can be for longer periods. This type of loan is also known as financing. Car loans generally include a
variety of fees and taxes, which are added to the total loan amount.

Many consumers apply for car loans at their local bank. When applying for a car loan a borrower will
usually begin by specifying how much money he or she wants to borrow. The borrower will then provide
information about his or her financial situation, beginning with income (the amount of money he or she
earns by working). Most lenders will require the borrower to provide some proof of employment, usually in
the form of a pay stub (the portion of a pay check that includes information about an employee’s earnings,
which an employee keeps for his or her records) or a copy of a tax return (the form submitted by individuals
when paying taxes). The lender will also check the borrower’s credit report. A credit report is a detailed
record of an individual’s past credit (in short, borrowing) activities, whether in the form of loans or other
debts (money owed). If the prospective borrower has a bad credit history, he or she may be ineligible for a
car loan.

Often a bank or financial institution will preapprove certain customers for car loans. In these situations a
consumer has a certain number of days (often 30, sometimes 45) to decide whether to seek full approval for
a car loan. Because most borrowers secure a car loan before actually shopping for a car, when an application
for a car loan is approved, a lender will generally give the borrower a maximum amount he or she will be
able to borrow. The borrower is then free to use this money to purchase the car of his or her choosing;
however, the borrower is not required to spend the full amount offered by the lender. For example, while a
bank might approve a car loan of $50,000 for a long-term customer, that customer has the right to spend only
a fraction of that amount.

8
1.3 Features Of Car Loan:-

Variable Interest Rate:

This means the interest rate on your loan will change throughout the loan term. The repayment on the loan
will coincide with the fluctuating market interest rate.

Fixed Interest Rate:

The interest rate is locked in and will not change for the duration of the loan. Budgeting is made easy as
repayments stay the same for the term loan.

Comparison Rate:

This rate is as transparent as you can get! A comparison rate is inclusive of fees and charges as well as the
interest rate.

Extra Repayments:

This features allows you to make advances and additional repayments on your loan, so you can be debt free
quicker than you planned. Stop around and find a loan that won’t charge you for making extra repayment.

Redraw Facility:

Once you’ve paid off a portion of your loan, you can draw that money back out again. This feature may be
handy to have for when an unexpected bill or health issue pops up.

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Payment Frequency:

This is how often and when you make repayments. The payment frequency is determined when you set up
the loan and can be weekly, fortnightly, monthly or an agreed date.

Loan Term:

This is the duration you have to repay the lender the money you have borrowed. With a secured loan the
term can range from 1 to up to 15 years. An unsecured loan term is shorted from 1 to 7 years.

10
1.4 Benefits Of Vehicle Loan:-

Open For All:

With the increasing competition between financiers, it has been of great benefits to the customers as the
population eligible for a car loan has increased. People falling in the mid income group can also easily avail
benefits of car loans from banks.

Simplified Methods:
The procedure required for a customer to get a car loan has been drastically Simplified to more customers in
taking car loans. The documentation and other paper work now take less than a day for approval.

Customize Your EMI:

This is of great advantage for customers, as financers give the liberty to the customers to decide there EMI’s
As per there capacity. Though paying a bigger amount reduces loan tenure.
Car finance allows a customer to approach a financier through dealerships, banks or credit unions, an online
financial institute who pays the maximum amount of the value of the car which is later paid by back by the
customers in EMI’s along with a rate of interest. Car loan in India are the best alternative for people cannot
pay a large sum of money at one time purchase a car.

Automatic Repayments (Salary/Account):

Our preferred method via automatic payroll deduction. However you can arrange to make your loan
repayments by direct debit from your savings or transaction account FCCS or another financial institution.

Redraw Facility:
The credit Union gives you the option of making extra repayments on your loan and then having the
flexibility of being able to redraw on these extra repayments. Term and conditions are available on
application.

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Early Repayment Without Penalty:
The earlier you pay off your loan the more money you save in interest charges. Some institution charges a
fee to help recover their lost interest charges. However, we don’t charge for this service.

ss

Variable And Lump Sum Repayments:

By contributing any extra income to your loan, in addition to your usual repayments, you are able to pay off
your loan sooner a therefore you could save thousands of dollars in interest cost.

ss

12
1.5 PUNJUB NATINAL BANK

Punjab National Bank (PNB) was incorporated under Act VI of the Indian companies Act and began its
operations just a day before Baisakhi, that is on 12th April 1895 from Lahore. It started its operation with a
working capital of Rs 20,000 and Rs 2 lakhs of authorized capital. Creation and establishment of this bank is
attributed to visionaries like Mr. Jessawala, Lala Lajpat Rai, Lala Harikrishan Lal, Babu Kali Prasono Roy
and Sardar Dyal Singh Majithai. The main objective is formation of PNB was to provide the country with a
true national bank which would dedicate itself to working towards the economic interest of the country and
play a pivotal role in ensuring the country’s growth and prosperity. Lala Lajpat Rai played a key role in
forming the establishing of PNB in its formative years.

13
1.6 PNB PRODUCTS AND SERVICES:-

Credit Cards:-

Introduction of credit cards have gives a boost to cashless economy and resulted in encouraging individuals
and businessmen towards use of cashless transactions. Punjab National Bank has three credit cards which are
affiliated to VISA, there are PNB Global Gold Credit Card, PNB Global Classic Credit Card and PNB
Global Platinum Credit Card. All the cards offer attractive perks and reward points against expenses which
are charged to the card or transactions carried out using the card. In case of theft or loss of credit card, you
will have to immediately report to the toll free customer care number which is available 24/7.

HOME LOAN:-

The main objective of providing home loan is to ensure the availability of affordable housing to all
individuals at attractive interest rates. Loan can be availed for purchase of land/already built house/under
construction house, to cover escalation costs and for renovation of the existing house. Given below are the
various schemes introduced for the various income groups-

 PNB Pride Housing loan for government employees– This scheme has been introduced with the
objective of ensuring that government employees buy a house at attractive and affordable interest
rates. The benefits of scheme can be availed by permanent employees of Central/State government,
Defence personnel and Paramilitary forces.

 PNB Housing Loan For Public(Pradhan Mantri Awas Yojana , Housing For All)-This scheme
was introduced with the objective of providing affordable housing to the EWS (Economically
Weaker Section) and LIG (Low Income Group) of individuals. Loans can be availed for construction,
purchase of house or for making additions to the existing house.

 PNB Gen-Next Housing Finance- This loan is specifically designed for professionals working in
the IT sector, PSU/PSB/Government employees to ensure they can buy a home at affordable price.

CAR LOAN:-

PNB offers a wide range of loans to individuals for financing cars of their choice. PNB Car Loan is a
traditional car loan provided to individuals, corporates and non-corporates who desire to purchase a car. It
takes into account various factors like the income of the person, previous track record of loan, if any. PNB
also offers PNB Pride Car Loan for Government employees. The objective of PNB Pride Car Loan is to
provide government employees easy financing of vehicle at attractive interest rates. Permanent Employees
of central government, state government, defence personnel and paramilitary forces are eligible to avail this
loan. Processing fees and documentation charges are NIL.

14
PERSONAL LOAN:-

Personal Loans have made it possible for our desires to shape into reality and with varied loan options PNB
offers to its consumers, it best fits their needs and affordability. After taking a loan, the borrower has to pay
EMI (Equated monthly instalment) up to the end of tenure of the loan. Given below are the following
Personal Loan schemes-

 Personal Loan Scheme for Public-The scheme is launched to make the funds available to the
general public to meet all type of personal expenses.

 Personal Loan Scheme For Pensioners- The scheme is launched to provide assistance to the public
drawing pension through the PNB.

LOAN AGAINST PROPERTY:-

PNB grants loan to the customers against their property to help them achieve their desires. PNB provides
loan against residential as well as commercial property. You can take the loan for personal need or for the
business need.  The maximum loan availed can be the 60% of the market value of the property.

EDUCATION LOAN:-
PNB provides Education loan to meritorious and deserving students to help them pursue their dream of
higher studies.  The various schemes launched by the bank include PNB Saraswati, PNB Pratibha, PNB
Udaan, PNB Kaushal, etc. The main objective of all the schemes is to provide assistance to the students who
want to do higher studies in India or abroad. The loan amount can be used to pay the college/school/hostel
fee, examination fee, library fee, laboratory fee. The bank also pays for the purchase of books, instruments,
uniforms, and equipment.

FIXED DEPOSITS:-
There are various Fixed Deposit schemes started by the PNB to get you higher interest on your fixed
deposits. Some of the schemes are PNB Uttam – Non -Callable Deposit Scheme, PNB Recurring Deposit
Scheme(E-RD), Schemes Covered (Under E-FD) and FD Scheme for Road Accident Victims. The
premature withdrawal is allowed on all the schemes. Loan or overdraft is available against the deposits,
however subject to bank’s discretion. TDS Certificate will be issued by the Bank for the tax deducted.

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1.7 FEATURES OF PNB CAR LOAN:-

 PNB car Loans are available for both salaried and self-employed.
 Special rates for PNB customers.
 Car Loans granted to age group between 21 to 65 years.
 Loan to Value Ratio is up to 85% on road price
 Maximum Tenure of loan is 7 years.
 Interest rates range from 8.75%
 EMI of Rs. 1,596 per lakh

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1.8 INTEREST RATE FOR CAR LOAN:-
To begin with, It is vital to understand the various cost factors involved for a car loan with regards to the
banks funding and your personal contribution (down payment). PNB presents different interest rates for the
different category from 8.75% – 11.20%

PNB New Car Loan Used Car Loan

Interest Rate 8.75% 11.20%

Loan Tenure Up to 7 years Up to 5 years

Lowest EMI Rs. 1,596 per lakh Rs. 2,064 per lakh

Loan Amount Up to 85% on road price Up to 70% of vehicle’s market

value

Prepayment Charges Nil Nil

You definitely want to ensure that your lender (Bank) provides auto-adjusted benefits on interest rates that
extends into the future. That’s the reason why you need a credible lending institution with a dedicated and
experienced workforce who will guide you through the entire process.

17
1.9 PNB PARAMETERS TO DECIDE CAR LOAN INTEREST RATES:-

3 basic criteria on which the loan interest rate would largely depend are:

• Loan amount: Car Loan amount will decide the interest rate you are going to pay. The more the loan
amount, the lesser the interest rate will be
• Your Salary: higher the salary amount, lower would be the interest rate

• Type of loan opted for: Account holders have a fair deal now! They can enjoy a lower rate of interest on
car loans.

It is generally advantageous to take a car loan as it will allow you to get tax exemptions. However, you must
consult your CA/ income tax advisor to know the benefits/disadvantages in your specific case.

1.10 ELIGIBILITY CRETERIA FOR CAR LOAN:-

To become eligible for PNB car loan the eligibility standard must be matched. That becomes an important
deciding factor for your loan amount. Instances like:

 Salaried, Self- Employed Professional or a Businessman

 Income
 Age
 Qualifications
 Number of dependents
 Co-Applicants Income
 Assets, Liabilities, Stability, and Continuity of Occupation of the borrower
 Savings History

Further, the loan eligibility will also be dependent on the value of the vehicle selected by you.
Some of the key eligibility factors are listed below:

Interest Rate 8.75%

Age 21 – 65 years

Job Stability in case of Salaried (in years) 2 years

Loan to Value Ratio Up to 85% on road price

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1.11 PROCESS OF APPLYING FOR CAR LOAN:-

You can apply for PNB car loan by contacting the bank directly or by applying online. Availing a loan
through an online marketplace improves the chances of getting best loan rates, low processing fees and
special offers in the form of cash backs. Once you approach the bank, they will collect your documents and
initiate the loan process which includes checking your CIBIL score, the value of the property, technical and
legal checks on the property, eligibility calculation. The bank will give a decision on your loan based on the
evaluation results.

19
1.12 PNB Car Loan Required Documents
 Document Required For A Salaried Professional:

 Duly filled and signed PNB car loan applicable

 Two -photographs
 Acceptable ID and address proof documents
 Last 6 months bank account statement
 Income proof latest salary slips up to 6 months from 16 for at least last 2 years

 Documents Required For A Non -Salaried , Self – Employed Professional

 Bank account transaction details for previous months

 Two – photographs
 Acceptable ID and address proof document
 Income proof ITR for last 2 years
 CA certified Balance sheet , Loss statement for 2 years , certified as per shop and
Establishment Act/ certified showing sales tax payments , etc

 Documents Required For Individuals Engaged In Agricultural Activities

 Statement of bank account for last 6 months

 Two – photographs
 Acceptable ID and address proof documents
 Bank accepted cropping pattern and land holding documents
 Documentary proof of dairy, plantation and related operation

20
1.13 PNB Car Loan Tax Benefits:
Car loans provided for self-employed/Business men that are used for commercial purposes are eligible for
tax deduction under section 80C of the Income Tax Act.

Similar Banks Offering Car Loans:- 

OBC Andhra Bank Central Bank of India Indian Bank

Union Bank of India IDBI Federal Bank Axis Bank

Bank of India Bank of Maharashtra Corporation Bank Car Loan EMI

Calculator

21
CHAPTER:- 2 RESEARCH METHODOLOGY

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2.1 Objectives Of The Vehicle Loan:

1. Promptly identifies loans with well-defined weaknesses.

2. Provides essential information to assess the adequacy of the bank’s allowance reserve

3. Assesses the adequacy of and adherence to loan policy and procedures, and ensures that the loan portfolio
complies with federal and state regulations.

4. Provides management and directors with an objective assessment of portfolio quality

5. Identifies relevant trends that could affect collectability of the loan portfolio, and isolates certain potential
problems.

6. Provides management and directors with accurate and objective credit quality information

7. Identifies loan documentation weaknesses and discrepancies in credit file reporting, while providing

appropriate corrective recommendations.

8. Monitors collateral on secured loans for adequacy, and for perfected collateral liens.

9. Ensures that appraisals on troubled real estate and other secured loans are maintained on a regular,
timely basis.

10. Reviews all troubled problem loan reports for appropriateness of the plan of action, risk rating
designation and allowance allocation.

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2.2 OBJECTIVE

 To study the schemes of vehicle loan provided by PNB

 To know the difference between loan policies of PNB and other banks
 To study loan process of PNB
 To find the awareness of car loan among the people

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2.3 HYPOTHESIS:-

H0 : There is a awareness of car loan of PNB banks among the respondents.

H1 : There no awareness of car loan of PNB banks among the respondents.
H1 : There is scope of improvement in the loan services provided by the PNB banks.
H0 : There is no scope of improvement in the loan services provided by the PNB banks.

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2.4 Limitation Of The Study :-

 Less Favorable Rates For ‘Unconventional’ Bank Loans –

Some banks say they are “Not In The Business” of doing auto loans or other personal loans. They
will grudgingly offer you an auto loan that may be accompanied by generally higher or
uncompetitive interest rates. These are not really the best lenders for financing a vehicle. If they’re
not interested in making a deal for your money, find someone else who is.

 Skipping Preferred Customer Status –

If a particular bank does not know you or have a financial history with you, you won't get some of
the preferred status that you might enjoy from another lender. Say, the dealer you bought your last
car from, or a local credit union connected to your employer.

 Third-Party Loans And Dealer's Lot Financing –

Since a bank will provide outside financing for getting your next vehicle, communications with this
outside party may be less convenient than going through your local dealership. For that reason, some
customers like to skip the outside process and just figure up their financing on the dealer's lot. It all
depends on what kind of deals you can get from third-party lenders compared to what your
dealership will offer you.

2.5 The Scope Of The Study:-

The scope of this particular research is based on the perception of the relevant customers towards car loan
which is limited to the area of Dombivli, Maharashtra. The study helps to understand the comparison
between private & public sector banks and how much the parameters can influence the customer in their
decision of applying car loan.
 It helps us in gaining independent knowledge about customer perception towards car loan.
 It helps in evaluating the effects of several parameters while choosing a car financing company.
 It can provide prospective information to potential customers.

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2.6 Methodology: - 

Introduction: -
Methodology is the systematic, theoretical analysis of the methods applied to a field of study. It comprises
the theoretical analysis of the body of methods and principles associated with a branch of knowledge.
Typically, it encompasses concepts such as paradigm, theoretical model, phases and quantitative or
qualitative techniques.

A methodology does not set out to provide solutions—it is therefore, not the same as a method. Instead, a
methodology offers the theoretical underpinning for understanding which method, set of methods, or best
practices can be applied to a specific case, for example, to calculate a specific result.

The methodology is the general research strategy that outlines the way in which research is to be undertaken
and, among other things, identifies the methods to be used in it. These methods, described in the
methodology, define the means or modes of data collection or, sometimes, how a specific result is to be
calculated.] Methodology does not define specific methods, even though much attention is given to the
nature and kinds of processes to be followed in a particular procedure or to attain an objective.
When proper to a study of methodology, such processes constitute a constructive generic framework, and
may therefore be broken down into sub-processes, combined, or their sequence changed.

A paradigm is similar to a methodology in that it is also a constructive framework. In theoretical work, the
development of paradigms satisfies most or all of the criteria for methodology. An algorithm, like a
paradigm, is also a type of constructive framework, meaning that the construction is a logical, rather than a
physical, array of connected elements.
Any description of a means of calculation of a specific result is always a description of a method and never a
description of a methodology. It is thus important to avoid using methodology as a synonym
for method or body of methods. Doing this shifts it away from its true epistemological meaning and reduces
it to being the procedure itself, or the set of tools, or the instruments that should have been its outcome. A
methodology is the design process for carrying out research or the development of a procedure and is not in
itself an instrument, or method, or procedure for doing things.

Methodology and method are not interchangeable. In recent years, however, there has been a tendency to
use methodology as a "pretentious substitute for the word method”. Using methodology as a synonym
for method or set of methods leads to confusion and misinterpretation and undermines the proper analysis
that should go into designing research.

2.7 Data Collection Method: -

To fulfil the objective of my study, I have taken both into consideration via primary and secondary data.

27
Primary Data: -

Raw data, also known as primary data, is data (e.g., numbers, instrument readings, figures, etc.) collected
from a source. If a scientist sets up a computerized thermometer which records the temperature of a chemical
mixture in a test tube every minute, the list of temperature readings for every minute, as printed out on a
spreadsheet or viewed on a computer screen is "raw data". Raw data has not been subjected to processing,
"cleaning" by researchers to remove outliers, obvious instrument reading errors or data entry errors, or any
analysis (e.g., determining central tendency aspects such as the average or median result). as well, raw data
has not been subject to any other manipulation by a software program or a human researcher, analyst or
technician. It is also referred to as primary data. raw data is a relative term (see data), because even once raw
data has been "cleaned" and processed by one team of researchers, another team may consider this processed
data to be "raw data" for another stage of research. Raw data can be inputted to a computer program or used
in manual procedures such as analysing statistics from a survey. The term "raw data" can refer to
the binary data on electronic storage devices, such as hard disk drives (also referred to as low-level data").

Survey:-

In statistics, survey sampling describes the process of selecting a sample of elements from a

target population to conduct a survey. The term "survey" may refer to many different types or techniques of
observation. In survey sampling it most often involves a questionnaire used to measure the characteristics
and/or attitudes of people. different ways of contacting members of a sample once they have been selected is
the subject of survey data collection. The purpose of sampling is to reduce the cost and/or the amount of
work that it would take to survey the entire target

Population. a survey that measures the entire target population is called a census. a sample refers to a group
or section of a population from which information is to be obtained.

Observation:-
Observations play a role in the second and fifth steps of the scientific method. However, the need
for reproducibility requires that observations by different observers can be comparable.
Human sense impressions are subjective and qualitative, making them difficult to record or compare. The
use of measurement developed to allow recording and comparison of observations made at different times
and places, by different people. Measurement consists of using observation to compare the phenomenon
being observed to a standard unit. The standard unit can be an artefact, process, or definition which can be
duplicated or shared by all observers. In measurement the number of standard units which is equal to the
observation is counted. Measurement reduces an observation to a number which can be recorded, and two
observations which result in the same number are equal within the resolution of the process

28
Questionnarie:-
A questionnaire is a research instrument consisting of a series of questions (or other types of prompts) for
the purpose of gathering information from respondents. The questionnaire was invented by the Statistical
Society of London in 1838.
Although questionnaires are often designed for statistical analysis of the responses, this is not always the
case.
Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as
much effort from the questioner as verbal or telephone surveys, and often have standardized answers that
make it simple to compile data. However, such standardized answers may frustrate users. Questionnaires are
also sharply limited by the fact that respondents must be able to read the questions and respond to them.
Thus, for some demographic groups conducting a survey by questionnaire may not be concrete.

Secondary Data:-

Secondary data refers to data which is collected by someone who is someone other than the user. Common
sources of secondary data for social science include censuses, information collected by government
departments, organizational records and data that was originally collected for other research
purposes. Primary data, by contrast, are collected by the investigator conducting the research.
Secondary data analysis can save time that would otherwise be spent collecting data and, particularly in the
case of quantitative data, can provide larger and higher-quality databases that would be unfeasible for any
individual researcher to collect on their own. In addition, analysts of social and economic change consider
secondary data essential, since it is impossible to conduct a new survey that can adequately capture past
change and/or developments. However, secondary data analysis can be less useful in marketing research, as
data may be outdated or inaccurate.
However, secondary data can present problems, too. the data may be out of date or inaccurate. If using data
collected for different research purposes, it may not cover those samples of the population researchers want
to examine, or not in sufficient detail. Administrative data, which is not originally collected for research,
may not be available in the usual research formats or may be difficult to get access to.

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Source Of Secondary Data Are As Follows:-

 Government Publication

 Websites

 Books

 Journal Articles

 Internal Records

 Articles

 Magazines

Sample Area: -

The sample area of study will be restricted to the Dombivli city only.

Sample Size:-
The sample size would be of 50 respondents.

Tabulation Of Data:-

The process of placing classified data into tabular form is known as tabulation. A table is a symmetric
arrangement of statistical data in rows and columns. Rows are horizontal arrangements whereas columns are
vertical arrangements. It may be simple, double or complex depending upon the type of classification.

Tabulation is the process of summarizing classified a grouped data in the form of the table so that is easily
understood and an investigator is quickly able to locate the desired information. A table is the systematic
arrangement of classified data in column and rows.

It facilitated comparison and often reveals certain patterns a in data which are otherwise not obvious.

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2.8 Tools And Techniques:-

1. Questionnaire Method:-

A questionnaire is a research instrument consisting of a series of questions (or other types of prompts) for

the purpose of gathering information from respondents. The questionnaire was invented by the statistical
society of London in 1838.
Although questionnaires are often designed for statistical analysis of the responses, this is not always the
case.
Questionnaires have advantages over some other types of surveys in that they are cheap, do not require as
much effort from the questioner as verbal or telephone surveys, and often have standardized answers that
make it simple to compile data. However, such standardized answers may frustrate users. Questionnaires are
also sharply limited by the fact that respondents must be able to read the questions and respond to them.
thus, for some demographic groups conducting a survey by questionnaire may not be concrete.

2. Interview Method:-

An interview in qualitative research is a conversation where questions are asked to elicit information.

The interviewer is usually a professional or paid researcher, sometimes trained, who poses questions to
the interviewee, in an alternating series of usually brief questions and answers. They can be contrasted
with focus groups in which an interviewer questions a group of people and observes the resulting
conversation between interviewees, or surveys which are more anonymous and limit respondents to a range
of predetermined answer choices. In phenomenological or ethnographic research, interviews are used to
uncover the meanings of central themes in the life world of the subjects from their own point of view.

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2.9 Sampling Technique

The sampling technique which was used is convenience sampling. 

Sources of data:
The two main sources of data for the present study been used are primary and secondary data.

Primary data:
This data was collected from the respondents with the help of questionnaire.

Secondary data:
Under this, the sources were taken from books, company brochures and internet for this study
.
Sampling plan:
As all the possible items will consider for research, the sampling method adopt will be convenience
sampling.

Sample population:
My sample population is the people having car loans in Dombivli.

Sample population:
Considering the nature and extent of the study and with the time constraint a sample size of “50”
respondents have been taken.

32
Chapter: - 3 Review Of Literature

33
3.1 LITERATURE REVIEW

A. Car market & buying behaviour by Nikhil Monga, Dr. Bhuvnender Chaudhury, Saurabh
Tripathi(2012):

According to Nikhil Monga, Dr. Bhuvnender Chaudhury & Saurabh Tripathi, the concept of “buying
behaviour” is of prime importance in marketing and has evolved over the years. It is important to understand
consumer buying behaviour as it plays a vital role in creating an impact on purchase of products. The human
wants are unlimited and always expect more and more. Car models are no exception to this behaviour. this
lead to constant modifications of car models & its features and today we see a new model coming into the
market practically every quarter. The market is a very important place to study the behaviour of consumers
and also provide useful insights what a consumer requires in a product. it is only through research that a
company will be able to study the buying behaviour of consumers.

B. A study on brand preference of 'B' segment cars by Dr. P. Natarajan & U. Thiripurasundari (2010):

According to Dr. P. Natarajan & U. Thiripurasundari, consumer brand perceptions have substantial
implications in marketing. The customers’ preference towards local and global brands is studied by
administering structured interview schedule with 150 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 quality of being a foreign made. Consumers made
favourable perceptions the country, wherein they tend to associate factors such as superior quality, technical
advancements, modernization etc. To the country from which the brand had taken its origin. consumers who
owned a local brand evaluated the local brand in a favourable manner, wherein they tend to associate the
brand to India’s strong automobile sector that makes quality and technically efficient cars.

C. The state of lending in America & its impact on U.S households by Delvin Davis (2012):

According to Delvin Davis, automobiles are one of the largest purchases American households will make,
only behind the purchase of a home. For most households car ownership is not a luxury but a prerequisite to
economic opportunity. Car ownership affects where people can live and significantly expands Americans’
options for jobs. As a result, both the affordability and sustainability of auto financing are central concerns
for most American families. as noted in America’s household balance sheet, in the last decade deleveraging
of auto loans began as early as 2005. Many households relied on home equity to finance car purchases, and
as that market disappeared, those families chose not to purchase a car at all or purchased cheaper vehicles.
Households responded to deteriorating income situations by buying used cars instead of new ones and
holding onto their cars for longer periods of time. these choices, however, have made families who did enter
the market even more vulnerable to abusive auto lending practices as the pressure to increase revenue per
sale grew.

34
 CHAPTER-4
Data Analysis And Interpretation

35
 1) Do you have a vehicle?
Option No. Of Respondent Percentage
Yes 30 60%
No 20 40%
Total 50 100%

40%
Yes
No
60%

Interpretation: -
From the above diagram we can say that, there are 60% of the respondent who have vehicle and
remaining 40% of the respondent don’t have vehicle.

36
 2) Are you taken vehicle loan from PNB?

Option No. Of Respondent Percentage

Yes 35 70%
No 15 30%
Total 50 100%

30%

YES
NO

70%

Interpretation: -
From the above diagram we can say that, out of total respondent 70% of the people have taken loan
for their vehicle from PNB bank and rest 30% of the people have taken vehicle loan from other
banks.

37
 3) What is the amount of loan you have taken from PNB?
Option No. Of Respondent Percentage
50,000-5,00,000 5 10%
5,00,000-10,00,000 20 40%
10,00,000-15,00,000 25 50%
Total 50 100%

10%

50,000-5,00,000
50% 5,00,000-10,00,000
10,00,000-15,00,000
40%

Interpretation: -
From the above diagram we can say that, 10% of the respondents have taken loan amount ranging
from 50,000-5,00,000, 40% of the respondent have taken loan amount ranging from 5,00,000-
10,00,000, whereas large number of people that is 50% out of the total respondent have taken loan
amount ranging from 10,00,000-15,00,000.

38
 4) Reason for taking loan from PNB?

Option No. Of Respondent Percentage

Interest Rate 20 40%
Faster Processing 20 40%
Brand Image Of The 10 20%
bank
Total 50 100%

20%

40%
INTEREST RATE
FASTER PROCESSING
BRAND IMAGE OF THE BANK

40%

Interpretation: -
From the above diagram we can say that, out of the total respondent 40% people says that they have
taken loan from PNB bank because of it’s lower interest rates, whereas again 40% of the people says
that they have taken loan from PNB bank due to it’s faster processing, and remaining 20% of the
people says that they have taken loan from PNB bank because of it’s brand image in the market.

39
 5) How was the loan sanctioning procedure of PNB?

Option No. Of Respondent Percentage

Quick 30 60%
Slow 20 40%
Total 50 100%

40%
QUICK
SLOW
60%

Interpretation: -
From the above diagram we can say that, 60% of the respondent says that the loan sanctioning
process of the PNB bank is quick, whereas 40% of the respondent says that the loan sanctioning
process of the PNB bank is slow.

40
 6) Give rating on the basis of interest rate charged by PNB?

Option No. Of Respondent Percentage

Good 20 40%
Better 15 30%
Satisfactory 15 30%
Total 50 100%

30%
40% GOOD
BETTER
SATISFACTORY

30%

Interpretation: -
From the above we say that, 40% of the respondent says that the interest rate charged by the PNB
bank is good, whereas 30% of the respondent says that the interest rate charged by the PNB bank is
better, and again remaining 30% of the respondent says that the interest rate charged by the PNB
bank is satisfactory.

41
 7) How was the documentation procedure of PNB?

Option No. Of Respondent Percentage

Complicated 20 60%
Easy 30 40%
Total 50 100%

40%

COMPLICATED
60% EASY

Interpretation: -
From the above diagram we can say that, out of the total respondent 40% of the people says that the
documentation procedure of the PNB bank is complicated, whereas 60% of the people says that the
documentation procedure of the PNB bank is easy as compare to other banks.

42
 8) When you have taken loan from PNB bank?

Option No. Of Respondent Percentage

One Year Before 10 20%
Three Year Before 15 30%
More Than Three 25 50%
Years
Total 50 100%

20%

ONE YEAR BEFORE

50%
THREE YEAR BEFORE
MORE THAN THREE YEAR
30%

Interpretation: -
From the above diagram we can say that, 20% of the respondents have taken loan from PNB bank
before one year, whereas 30% of the respondent have taken loan from PNB bank before three years,
and remaining 50% of the respondent have taken loan from PNB bank before more than three years.

43
9) Are you satisfied with the loan services provided by PNB?

Option No. Of Respondent Percentage

Yes 40 80%
No 10 20%
Total 50 100%

20%

YES
NO

80%

Interpretation: -
From the diagram we can say that, out of the total respondent 80% of the people says that they are
satisfied with the loan services provided by the PNB bank, whereas 20% of the people says that they
are not satisfied with the loan services provided by the PNB bank.

44
 10) Are you interested to take a vehicle loan from PNB in future?

Option No. Of Respondent Percentage

Yes 35 70%
No 15 30%
Total 50 100%

30%

YES
NO

70%

Interpretation: -
From the above diagram we can say that, out of the total respondent 70% of the people are willing to
take loan from PNB bank in future, whereas 30% of the people are not willing to take loan from PNB
bank in future.

45
CHAPTER NO:-5 CONCLUSION

46
5.1 CONCLUSION:-

In my 60 days study on the car loan and the comparison between public and private car finance companies
within the Dombivli city, I conclude the following.

There are different commercial banks who supplies car loan like SBI, HDFC, IDBI, Allahabad bank etc.
Different banks have different rate of interest. Some of those are public banks and some are private banks.
Majority of the respondents prefer using motor vehicle of Hyundai and Maruti Suzuki which are
comparatively cheaper in the market.

The respondents feel that government financier’s charges low interest rate whereas private financiers charges
high interest rate. So on that notes they prefer government banks to take loan. But on the other hand,
government financiers are slow while processing of loan whereas private financiers are faster loan processor
so people who have no issue with the interest rate but need the process to be faster, they will prefer private
financiers to apply loan. Factors like urgency of loan, proper documentation and verification plays crucial
role.

Consumers think that government financiers are more credible in comparison to private financiers. The
factors like more hidden cost & low processing efficiency in loan sanction. The government financiers have
less hidden cost as compared to private financiers. Hidden cost can be the beyond estimated cost.

The private financiers have lower fees as compared to government financiers. Lower fees can be the
processing fees, penalty etc. Penalty rates can influence the buyer’s choice towards financing agency.

47
BIBLIOGRAPHY: -

Websites

 Http://Www.Mahindrafinance.Com/Car-Loans.Aspx

 Http://Www.Aufin.In/Index.Php?Option=Com_Content&View=Article&Id=52&Itemid=62

 Http://Www.Bankofbaroda.Co.In/Pfs/Carloans.Asp

 Http://Carloan.Kotak.Com/Aboutus/Kpml_Pro.Htm

 Http://Www.Scribd.Com/115571449/PNB-Car-Loan

Newspapers:-

1. Times Of India
2. The Hindu
3. The Business Line

48
CHAPTER NO:- 6 Annexure: -

49
6.1 Annexure: -

1) Do you have a vehicle?

a) Yes b) No
If Yes,
a) Four Wheeler b) Two Wheeler
c)Others d) commercial (Truck , Bus , Riskha , etc)
2) Are you taken vehicle loan from PNB?
a) Yes b) No

3) What is the amount of loan you have taken from PNB?

a)50,000- 5,00,000 b)5,00,000- 10,00,000
c)10,00,000- 15,00,000 d)15,00,000- above
4) Reason for taking loan from PNB?
a) Interest Rate b) Brand Image Of The Bank
c)Other Reason c) Faster Processing
5)How was the loan sanctioning process of PNB?
a) Quick
b) Slow
6)Give ratings on the basis of Interest rate charged by PNB?
a) good b) Satisfactory
c)Better c) Bad
7)How was the documentation procedure of PNB?
a) Complicated
b) Easy
8)When you have taken loan from bank?
a) One Year Before b) Three Year Before

c)Two Year Before c) More Than Three Year

50
9)Are you Satisfied with the loan services provided by the PNB?
a) Yes
b) No

10) Are you interested to take a vehicle loan from PNB in future?
a) Yes
b) No

51