PREFACE

This project report has been prepared in fulfilment of the requirement

for the Internship project: “A study on customer satisfaction towards
gold loan during pandemic to Muthoot Fincorp Pvt. Ltd” .

For preparing the project report, we have filled up the questions during
the suggested period, to avail the necessary information. The blend of
learning and knowledge acquired during our practical studies at the
company is presented in this project report
 ACKNOWLEDGEMENT
I am extremely thankful to Dr. Viral Bhatt- Principal, Sal Institute of
Management for providing us the great opportunity to learn through
SIP Training and he is always there to solve our difficulties and for
providing me the great support. I am extremely thankful to our project
guide Prof. Margi Chokshi for providing us in depth knowledge and
helping us towards successful completion of project. He has always
welcomed our queries and solved it nicely. Without her help and
guidance, it is difficult for me to complete the project. Last but not the
least I would like to thank my all friends who have given me the
guidance for the further development and enrichment of my project.
With Thanks
TABLE OF CONTENT
 INTRODUCTION TO GOLD LOAN
Gold prices touching record highs through the month of July has got
many wonderings how they can make use of their physical gold.

India is the world’s second largest consumer of gold, as citizens attach

significant cultural value to gold coins, bars and jewellery held and
gifted. In fact, in an interview with Indian financial daily The Financial
Express last November, the managing director of World Gold Council
had revealed that Indian households have accumulated up to 25,000
tonnes of gold.

Many consumers who hold gold in reserve are considering gold loans
as an option to meet their credit requirements, and Indian financial
entities have a host of options on offer. Gold loan companies and banks
have reported a surge in demand for gold loans in the last three
months since the coronavirus pandemic hit
 HOW DOES A GOLD LOAN WORK
The lender evaluates the pledged jewellery in terms of purity and
weight and verifies the jewellery ownership and identity documents
submitted before offering a loan amount, also known as the LTV (loan
to value).

A credit limit, similar to a bank overdraft account, is sanctioned up to a

limit of 75% of the market value of the pledged gold ornaments. This
LTV is capped by the Indian banking regulator Reserve Bank of India.
This amount can be withdrawn by the customer whenever required. On
repayment of the loan, the customer has the option to repledge the
same gold for future loans.

Customers do not need to repay the loan via a monthly installment

amount. They enjoy the choice of instead making bullet repayments,
which refer to a lump sum payment made for the entirety of an
outstanding loan amount, usually at maturity.

On maturity, the customer has the option to repay the outstanding and
close the account or extend the tenure by repledging the jewellery at
the current LTV.

There exists no limit on how many times a customer can repledge their
gold, which means the loan can be rolled over for as long as needed.

Some banks and NBFCs also allow partial payments and early
repayments without any penalties. In this way, a gold loan functions
like an overdraft facility for the retail customers
 FUTURE OF GOLD LOAN IN INDIA
The organised gold loan industry is estimated at about INR 3.5 trillion,
or about 7% of the total size of the personal loan industry—estimated
at over INR 25 trillion.

All big banks in India including the state-owned State Bank of India,
plus India’s largest private banks HDFC Bank, ICICI Bank and Axis Bank,
among others, are competing to offer lower interest rates and
processing fees to lure customers.

Among popular gold loan NBFCs are Manappuram Finance, Muthoot

Finance and IIFL among other that are offering gold loans.

In the short-term, Manappuram Finance has seen growth in gold loans

from customers who are taking advantage of the higher LTV propelled
by the sharp rise in gold price to borrow more against their existing
pledges.

“We expect that once people get the sense that high prices of gold are
here to stay for some more time, the impetus to sell their gold will
ebb,” says Nandakumar. He envisages a 10 to 15 percent growth in the
company’s gold loans portfolio in the coming months.

Muthoot Finance is banking upon traders, shopkeepers and small-

business owners to take up gold loans actively to meet working capital
requirements to kick-start their businesses, as many do not have
sufficient collateral to provide against bank loans.

If you’re hoping to put your idle gold to good use, gold loans could be a
financial product to research. In the case of gold loans, borrowers need
to thoroughly understand the conditions of their loan terms to ensure
all that is glittering is indeed gold.
 INTRODUCTION TO COMPANY

DATE OF ESTABLISHMENT 19th March 2002

CIN U65929KL1997PLC011518

REGISTERED ADDRESS Muthoot Centre TC No 14/2074-7

Punnen Road

Trivandrum

Thiruvananthapuram – 695039

Kerala – India

TAGLINE “JAB ZINDAGI BADALNI HO!’’

 FOUNDER OF MUTHOOT GROUP

Muthoot Pappachan was a simple and devout man,

who espoused a nine-point formula that stood by him in realizing his
goals. Love. Peace. Happiness. Kindness. Helpfulness. Patience.
Pleasantness. Faithfulness and Self-control. These ethics have been a
guiding light to the path of his successors and have permeated to every
strata of the Muthoot Pappachan Group. These values still govern every
decision in the Group. When asked for his formula to success, he
quipped, “unflinching faith in the Almighty and unshakeable
determination to face and overcome challenges.” In dire circumstances
and sometimes in the face of loss, he was heard to quote that a debit
on earth will be a credit in heaven. A man, known to adhere to his
word, he instilled these values throughout the organization he nurtured

In the year 1887, Muthoot Ninan Mathai, patron

founder of our group, started in a humble way as a retail and whole-
sale trader of grains at Kozhencherry, Kerala. These wholesale goods
were mainly supplied to the large estates owned by British Companies.
Subsequently, understanding the unmet saving needs of the estate
workers, Mr. Ninan Mathai, started the Chit Funds business

with philanthropic motive, as an avenue for saving. Functioning out of a

single office in Kozhencherry, Muthoot Ninan Mathai entered the gold
loan business in the 1950’s. He soon went on to become the largest
player in Chits & Gold Loans. Soon Kozhencherry became a known
name where people across Kerala came to for gold loan & chits
HISTORY OF MUTHOOT FINCORP Pvt.Ltd
We take our name, Muthoot, from our family, which is a branch of a
traditional Orthodox Christian family, based in Kozhencherry, a small
town in the erstwhile primary state of Travancore. (Kerala). In the year
1887, Muthoot Ninan Mathai (Patron Founder of the group), started as
a retail and wholesale trader of grains at Kozhencherry. The wholesale
goods were supplied to the large Estates owned by British Companies.
Later, understanding the needs of the estates’ workers and at the
request of the British owners, who appreciated the values & principles
of Mr. Ninan Mathai, he started a form of Chit Fund. The aim was to
provide self-less service for the workers, who were not able to manage
their cash and would tend to lose and/or misspend the same. Giving
the workers an avenue for saving, provide for exigencies and also
secure their tomorrow, started as a simple solution to the need at that
point in time, soon gained momentum and spread across. The business
grew slowly but steadily along with its share of ups and downs.
Functioning out of a single office in Kozhencherry, Muthoot Ninan
Mathai entered the gold loan business in the 1950s. He soon went on
to become the largest player in Chits & Gold Loans. Even today, people
from across the state are happy to come to Kozhencherry for gold loans
& chits. The Late Muthoot Ninan Mathai had four sons, Ninan Mathew,
M. George, M. Mathew and Mathew M. Thomas (Muthoot Pappachan)
who were involved in the business from their childhood and later took
over the family business. In the late 1980s, the business was most
amicably split four ways and Shri Muthoot Pappachan founded the
Muthoot Pappachan Group.
Over the years, the Muthoot Pappachan Group has grown to become a
significant entity in the Indian business landscape. “A journey of a
thousand miles begins with a single step”. True to this adage, the group
which planted its roots in retail trading, later diversified and made its
mark, into various sectors including Financial Services, Hospitality,
Automotive, Realty, IT Services, Healthcare, Precious Metals, and
Alternate Energ.
 WHERE THEY STAND TODAY
Currently Muthoot Blue has over 26,000 employees, serving around 5
million customers through its 4,200+ branches, other offices and team
on the ground, across the country. Our extreme customer-centric
approach and innovation in terms of new products that cater to
changing customer needs, have helped in winning the loyalty of
innumerable customers, as well as in attracting new ones. Adopting the
latest technology and new ways to serve customers, without
compromising on basic principles and ethics we have been following
since our inception, is what drives the Group
 MUTHOOT FINCORP Pvt.Ltd.GOAL
Our Values

We will do everything to gain and maintain the Trust of all the

stakeholders and will not do anything to lose their trust.

Our Mission

To provide timely small credit to millions of ordinary people, and also

provide them with simple options to save their hard earnings.

Our Vision

To be the most trusted financial service provider, at the doorstep of

the common man, satisfying him immediately with easy and simple
products
PRODUCT AND SERVICE
 GOLD LOAN IN MUTHOOT FINCORP
Gold Loan offered by Muthoot FinCorp is just perfect for raising short-
term working capital or to meet your emergency financial needs, in just
a few minutes at any of its 3600+ branches across the country.
Muthoot FinCorp offers competitive LTV and interest rates and industry
first 24×7 SMS based Gold Loans top-up facility to transfer money to
customer’s bank account, anytime. Muthoot Gold Loans have unique &
customer-centric features such as cash-backs on regular on-time
payment, digital payments and on-time loan-tenure completion which
make them India’s Most Rewarding loan against gold.
 GOLD LOAN PROCESS
• Visit:
Walk into your nearest Muthoot FinCorp branch for the most
rewarding Gold Loan.

• Pledge:
Get your Gold appraised and pledged with a positive and
pleasant experience.

• Instant Cash:
Your loan gets processed and you walk out with an instant cash
 FEATURES PROVIDED BY MUTHOOT
• Easy to get:
They sanction your gold loans quickly and without any problems or a
credit score. Walk into any one of 3600+ branches across India and get
loan against gold instantly. They will calculate the value of the gold
(purity check) right in front of you and with a simple process, within a
few minutes, they will sanction the loan for you .

• Minimum Paperwork:
Very few documents are required for loan against gold approval. When
you visit one of Muthoot Fincorp branches, just carry your ID papers.
There is no need to get a guarantor when going for a gold loan. The
liability or risk involved is limited to the gold you put up as collateral.
They share the certificates of gold value at the time of deposit .

• Attractive Rate of Interest:

They offer you loan against gold at very attractive interest rate starting
at just 12% pa. And, provide maximum permissible value for your
ornaments pledged depending upon the gold finance scheme you
choose. You get minimum processing fees ranging from Rs. 12 to Rs. 20,
along with quick sanctioning and disbursal of loan is possible with
minimum documentation and KYC procedures.

• They Keep Your Gold Safe & Insured:

Your gold is kept in lockers within Strong Rooms at the branch. They
use world-class surveillance and safety standards. Your Gold kept with
bank is also insured for its market value. A loan against gold from
Muthoot Fincorp has triple-advantages -You get a loan against your
gold; your gold is safe & insured and you can top-up your existing loans,
anytime, from anywhere.(with the 24/7 facility).

• Flexible Repayment and Tenures:

They have both Bullet and EMI schemes. Bullet schemes give you the
freedom to repay any amounts at any time during the loan tenure; you
can even choose to make repay the principal amount and interest in
multiple instalments as per your convenience it gives the facility to
repay monthly interest and repay the balance principal amount at
closure. It also gives facility for part payments and part withdrawal by
paying required amount. They have different variants of bullet schemes
designed in line with cash cycles & needs of different customer
segments and you can choose most appropriate one suiting yours. Our
EMI based Smart Gold Loans provide options of repaying in structured
equated monthly instalments and provide longer loan tenures.
 PROS OF TAKING A GOLD LOAN
• Existing Asset Can Be Used
When taking a gold loan, borrowers can pledge the jewellery and gold
bars or coins that they already own. This means the customer enjoys
the benefit of possessing the jewellery and taking a loan on it whenever
they want. This jewellery is returned to the customer securely once the
loan repayment is complete, or it can be reused.

• Repledging
There is no limit on the number of times the same piece of jewellery or
gold coins or bars can be pledged. This helps customers take loans
repeatedly on the same asset. This feature is unique to gold loans, as
compared to personal loans, where loans are disbursed based on the
customer’s capacity to repay the loan. Also with personal loans, a
repeat loan from the same banking entity completely depends on the
customer’s ability to repay at that point.

• Bullet Payments
The biggest advantage of a gold loan is the flexibility to repay the loan
principal and interest as a lump sum amount instead of the popular way
to repay other forms of loans—equated monthly instalments, or EMIs.
This feature encourages small-business owners and traders, who face
temporary cash crunch situations, to take gold loans as opposed to
other loan options where monthly EMIs could burden borrowers from
the very next month of the loan approval.