Gold Loan Project

A study on customers delight towards on gold loan
(with special reference to manappuram finance limited in HSD)
CHAPTER 1
INTRODUCTION
1.1. Introduction to gold loan
Gold Loan is evident from the name that the Gold Loan is offered
against gold. It is being offered by a number of Banks and Financial
Institutions. The Rates of Interest offered on these Loans are comparatively
reasonable It is extremely convenient to apply for Gold Loan and the entire
process can be done in quick time These days, many nationalized banks, Private
Banks and other financial companies offer this Loan at attractive rates Many
borrowers are opting for Gold Loan for short period to meet the requirement of
their children‟s Education, marriage and other financial problems in the family
And some the borrowers also thinks that instead of keeping the gold idle at
home or locked, Loan against gold is the best option Moreover, with the rise in
gold rates the demand from companies and banks offering Gold Loans has been
growing For instance, traditionally, the possession of gold has been a symbol of
prosperity and considered a safest form of investment that provides a hedge
against inflation Gold has always been a highly coveted product not only in the
form of jewellery, gold bars or bullion, but also has the ready acceptability as
collateral for the lenders because of its high liquidity character According to an
estimate of World Gold council, about 10 per cent of worlds gold is in India‟s
possession.
Department of commerce (PG) G.F.G.C Hosadurga Page 1

1.2 Customer Delight
1.2.1 Meaning
 Customer delight is surprising a customer by exceeding his or her

expectations and thus creating a positive emotional reaction. This
emotional reaction leads to word of mouth. Customer delight
directly affects sales and profitability of a company as it helps to
distinguish the company as it helps to distinguish the company and
its products and services from the competition.
 Customer delight can be created by the product itself, by
accompanied standard services and by interaction with people at
the front line. The interaction is the greatest source of opportunities
to create delight as it can be personalized and tailored to the
specific needs and wishes to the customer.
1.2.2 Definition
 Paul Farris defines customer Delight as “the number of customers, or

percentage of total customers, whose reported experience with a firm, its
products, or its services exceeds specified satisfaction goals”.
 The very favorable experience of the client of business when they have
received a good or service that significantly surpasses what they had initially
anticipated.

1.3 Genesis of gold loan market in India
In India, it is believed that most of the gold is held by people in rural areas and
in many cases this is the only asset they have in their possession though in small
quantity All the while, rural Indians know that if his crop fails or his family is
sick, he can raise cash in a moment from the goldsmith or may be pawnbrokers
and moneylenders, because the rural India lags in availing banking facilities
Therefore, even the pattern of saving in India differs for various Income groups.
The jewellery bought in times of prosperity has been pawned or sold for cash in
periods of distress or need Over the years, some portion of this is being used as
collateral for borrowing in the informal market, though estimates are not
available It is a common practice in India that gold is pawned, bought back and
re-pawned to manage day-to-day needs of the poor and middle class The
pledging of gold ornaments and other gold assets to local pawnbrokers and
money lenders to avail Loans has been prevalent in the Indian society. over
Ages Due to the increased holding of gold as an asset among large section of
people as also the borrowing practices against gold in the informal sector have
encouraged some Loan companies to provide Loans against the collateral of
used gold jewelleries for years and over a period to emerge as specialized Gold
Loan companies.
1.3.1 Meaning of gold loan
 When a customer pledges gold as collateral for taking a loan, it is known as

a gold loan. The bank /lender uses the gold as security against potential
payment default by the customer. The loan amount sanctioned is certain
percentage of the value of the gold that has been pledged. It is a short term

loan ranging from 1 month to few years. The payment had to be done in that
period.
 Banks/NBFC‟s provide loan and asks for the security from the person
willing for the loan. Minimum of paperwork and a person receive the money
immediately. The security asked for is the gold that the individual applied
for, owns. This is collateral asked for by them. The funding institutions
provide a loan amount of up to 85% of the market value of the gold at the
particular time.
 Gold loans are secured loans where gold jewellery is used as collateral. You
pledge your gold jewellery with the lender and get a loan. The loan amount
is usually a percentage of the gold‟s value. You can repay the loan through
monthly installments. After the repayment, you get back your gold
jewellery.
1.3.2 Definition of gold loan
 Gold loans (or gold deposits) may be undertaken to obtain an income return
on gold. The gold that is placed on loan (or deposit) may be either a
financial asset (i.e., monetary gold) or a non financial asset (i.e., non
monetary gold) the gold remains on the books of the gold lender, and the
lender retains the exposure to the market risk arising from movements in the
market price of gold. Gold loans are not backed by cash collateral and, in
some cases, are not backed by non-cash collateral. However, the gold may
be on-sold by the borrower.
 As the name suggests this is the loan given against gold. Many nationalized
banks, private banks, and other financial companies offer this loan at
attractive rates. Many go for this loan for short period to meet the

requirement of their children‟s education, marriage and other financial

problems in the family. And others think that instead of keeping the gold
idle at home or locker , loan against gold is the best option. Moreover with
the rise in gold rates the demand from companies and banks offering such
loans has raised.
1.3.3 Features of gold loan
 Faster processing: – As the gold loans are backed by physical gold, the
bankers are generally more than happy to give loan. Lending against gold is
safe for the banks as they have the option to sell the gold in case you default,
therefore banks generally disburse the loan in few hours. This is because
the processing time is less.
 Option to pay interest only: – Gold loans have a unique feature where the
borrower has the option of paying just the interest part and the principal
amount can be paid at the time of the closing of the loan.
 Lower interest rate: – As these are secured loans banks charge a lower
interest rate compared to unsecured loan such as personal loan. The interest
rates are generally in the range of 13 to 14% while personal loan generally
starts with an interest rate of 15%. Also, if you attach another security as
collateral, the gold loan interest rate can be reduced further.
 No processing fees: – Many NBFCs and banks don‟t charge processing fees
as these loans are given instantly in lieu of gold which is held as collateral
with the lender.
 Low or no foreclosure charges: – Some of the lenders don‟t charge any
prepayment charges while some of the banks do charge a prepayment
penalty of 1%.
 No-income proof required: – Generally lenders don‟t ask for income proof
as the loan is secured against the gold to keep with the bank.
 Safety of gold: – The onus of the security of the gold lies with the lender. It
will remain safe in its vault; you don‟t have to worry about that. After you
repay the loan you will get your gold back.
1.3.4 Advantages of gold loan
There are various advantages and unique features of Gold Loan to the borrowers
as compared to other Loans as follows:
 The unique features of Gold Loan are that even unemployed or non-working
can apply for it Unlike other Loans, Gold Loan lenders don‟t demand for any
certificate to show one‟s Income and even no Credit card history is required
Thus, even unemployed and non-working people can also apply for Gold Loan.
 The unique feature of Gold Loan is that it requires minimum documentation
during the process Unlike any other unsecured Loan, the Gold Loan doesn‟t
require much papers (documentations) only few documents such as ID proof
and address proof is enough to avail of such Loan.
 One of the main advantage of Gold Loan is its low interest rates. Usually Loan
over gold is provided in the interest of 12-16% per annum and this is quite low
compared to Gold Loans available at interest rates of 15-26% per annum by
Unorganized Loan Lender. The unique feature is the Gold Loan charge low
interest rate as compared to Gold Loans from the Unorganized Loan Lender.
 In rural areas Agricultural Loan against gold is also available for agriculturist at
very nominal Rate of Interest of 7%-8%, but one need to give a proof of
agricultural document.

 The borrower will be given an option to pay only interest during the entire term
and at the end of the tenure one can pay the complete borrowed amount in a
single shot.
 In case of Gold Loan processing time is very less. Usually banks take just a few
hours to complete the process whereas in case of NBFCs (Non-Banking
Financial Companies) a few minutes are enough for the same. So for immediate
financial help this is the best option.
1.3.5 Gold loan interest rates
Mode of calculation:
 Interest rate will be quoted on annualized basis only.

 Interest amount will be calculated on the daily outstanding balance in the
loan account at the concentrated rate.
 Interest will be calculated on the basis of 365 days in a year
 Compounding, if any, will be provided in specific loan schemes
 All loans carry the fixed contracted rate till closure of account.
Risk related rate of interest:
 Since a higher LTV (loan per gram) translates to a higher risk interest
rate and LTV will be correlated.
 Assuming all other factors to be the same a higher LTV loan will attract a
correspondingly higher interest rate as compared with a lower LTV loan.
 The interest rate applicable will vary from time to time and will be
mentioned against the specific operative schemes/ loan products.
Maximum rate of interest

The maximum interest rate chargeable has been fixed at 28%per annum
Penal / overdue interest
When the loan remains outstanding beyond the normal tenure overdue / penal
interest will be charged at 3%per annum (i.e. contracted rate plus 300 basis
points) on the amount due and payable till the account is regularized / closed.
1.4 Gold loan in India
As the price of gold were increasing the Advance against gold loan were also
increasing and some NBFCs gain a sharp increase in their profit by the product
of gold loan. They find it very much convenient tool for giving loans, As there
is very less chances of risk. And due to less risk customer get loan at cheaper
cost in comparison to personal loan. There is very less formality and paper
work anyone can take loan against the gold within few minutes. Geographical
expansion of gold loan companies facilitated the loan delivery. Flexibility of
loan options, liberal Loan to Value Ratio, easy to conform documentation led to
expansion of gold loans. The average size of the gold loan increased due to the
rapid price increase of the gold and constricted availability of retail and
personal loans from banks.
1.4.1 Specification of gold loan
This is a secured loan as the gold is deposited with the banks and NBFCs.
Shorter period loan extending to a maximum of 12 months in most cases. The
amount of loan is decided by the value of gold not by the paying capacity of
individual. Interest rate is less in compare to personal loan. It ranges between12

% to 26 % in different companies. The risk associated with this is the

fluctuation in gold price, which may increase loan default.
1.4.2 The risk associated with gold loan
 Price fluctuation of gold loan:-The fluctuation of gold price make worried

to the lender and the amount of loan which given against the gold value will
not be the adequate when the price fall down this will Increase the loan
default
 The growth of gold loan is concentrated in south India: - The industry is
too concentrated in the south. Some 75 percent of Manappuram business is
in the south. he gold loans business is not so bad, but concentration in the
south is still too heavy for comfort.
 Saturation of business opportunities:- Growth rates have started slowing
down progressively as the business grows. Rates of 100-200 percent are
more or less over.
 Growing competition:- Competition is growing as we have seen above
many banks an NBFCs ar3e coming in this sector and launching their gold
loan product with several facilities.
 Change in policy and norms: - With time definitely regulatory body come
in action to control the practices of these companies The Reserve Bank India
has declared it as non priority sector lending. This pushed up interest rates
by 1-2 percent immediately.
 Margin of loan against gold:- private companies lend against lower
margins. Unlike banks, which lend 55-65 percent of the value of gold
mortgaged, private companies give out higher proportions of 70-80percent.
This means the safety margins are thinner for them.
 Concentration risk:-As more than 90 per cent of the assets are concentrated
only in gold jewellery loans.
 Lack of transparency: Lack of transparency in procedures adopted by
these NBFCs for auctioning the pledged gold has become a concern.
 Complaint against some NBFC:- Regarding not adopting KYC norms and
overcharging of interest rate and related to action process.
1.4.3 Charges associated with gold loan:
 Loan processing charge: While some of the service lenders may even waive
these Loan processing charges but some banks do charge a processing fee,
which count may be very low.
 Valuation Charge: These are the charges to be paid to the evaluator these
charges are also specific to the servicing lender and those having in-house
evaluators do not charge any extra amount for valuation.
 Late payment penalty: Most of the service lenders charge a late payment
penalty and this also can vary from one institution to the other.
 Prepayment penalty: Most of the service lenders do not charge a penalty for
repayment before the Loan tenure is over but some may still have this charge
in place. It is advisable to check with the Loan lender before taking the Loan
these charges could change the amount that one may finally receive Even
though Gold Loan appears to be advantageous to borrow, but one need to
have some advices before opting for it as a Loan.
1.4.4 Advice on gold loan
The advice that needs to be followed by borrower is to keep in mind before

opting for the Gold Loan is as follows:
 One can opt for Gold Loans if he or she is confident of returning the money in
time otherwise, one will be penalized and all pledged gold will come under the
control of the bank or finance company.
 While opting for a Gold Loan check the Interest Rate in various banks and
private finances If he she goes for private lender, then better to opt one who has
been in this business for many years Therefore, now the Gold Loan can become
the best option as far as one is not emotionally linked to own gold ornaments
However, nothing like this can help ones during time of difficulties; it is the
best options for many due to its quick process But still some basic
documentation is required.
1.4.5 Gold as a secured loan
A secured Loan is a Loan in which the borrower pledges some asset ( e g: Gold
or property) as collateral for the Loan, which then becomes a secured debt owed
to the creditor who gives the Loan The debt is thus secured against the
collateral in the event that the borrower defaults, the creditor takes possession
of the asset used as collateral and may sell it to regain some or the entire
amount originally lent to the borrower, for example, foreclosed a portion of the
bundle of rights to specified property If the sale of the collateral does not raise
enough money to pay off the debt, the creditor can often obtain a deficiency
judgment against the borrower for the remaining amount The opposite of
secured debt Loan is unsecured debt, which is not connected to any specific
piece of property and instead the creditor may only satisfy the debt against the
borrower rather than the borrower's collateral and the borrower There is growth
in the borrowers of Gold Loan The factors affecting the growth are explained
next.

1.4.6 Factors affecting gold loan
By virtue of their business model, NBFCs grew rapidly over the last few years
as evidenced by their increase in market share. The key differentiators for the
NBFCs as compared to the banks and cooperatives are
 Quick Loan approvals and disbursals, with minimal documentation.

 Greater accessibility due to better penetration.
 Non-bankable customers are also served.
 Better operating cost structure versa-a-versa banks.
 Convenient hours of operation.
 Flexibility: Provision of very small and very large Loan amounts In the
process of the Gold Loan-there can be chance of defaulter as lender gives
the Loan on gold pledged.
1.4.7 Risk to the borrowers and lenders
It is necessary to know the risk involved in borrowing Gold Loan as well as

lending the Gold Loan This risk is covered either by better security and
insurance The details regarding the risk of borrowers as well as lenders in
Gold Loan as follows.
 Thefts and Robbery: Since lender take possession of the gold asset in a
Loan transaction, if in case of a theft, the lender may not have sufficient
funds to compensate all the borrowers for their loss in its entirety This is
more important for Loan placed in the Organized sector; ( banks NBFCs)
usually have better security and insurance coverage Furthermore, financial
packages cannot compensate for the personal attachment a borrower has

with the gold assets which they had pledged So borrower will expect the
same gold than the finance. Thus the lender needs to take necessary
precautions.
 Increases in Gold Price create a Gold Loan bubble: The increase in gold
price over the last few years, which is coupled with the surge in Gold Loan
borrowing can create a gold bubble which will burst in the event of a
significant correction in gold prices Banks NBFCs with significant exposure
to Gold Loans could face widespread defaults, which can adversely impact
the economy.
 The borrower may be more willing to default on the Loan: Moreover, a
sharp decline in gold prices increases the original LTV. A lender may
require an immediate recovery of any amount that exceeds the original LTV
ratio, but the borrower may be unable to pay this amount Restructuring of
the Loan may be required in these cases Additionally, if the value of the
pledged asset declines, a borrower may be more willing to default on the
Loan This poses a serious concentration risk to the lender, especially to the
NBFCs that have a high exposure to Gold Loans and lend at high LTV
ratios.
 The increase interest rate is the important factor to increase the market share
of the Gold Loan as compared to other Loan especially in comparison to a
Personal Loan The low Rate of Interest has attracted the borrowers Some
of the leading companies and banks offering Gold Loan are ICICI bank,
Muthoot Finance, Manappuram Gold Loan, SBI and HDFC.

1.4.8 Role of technology in rapid growth of gold loan
To expansion the various activities and functions of the banks, the bank has
large number of customer data The bank has to assured the smooth working of
the banks as well as updated and timely service to the large number of customer
Therefore, bank / Financial Institution have started through internet as well as
new software to provide information to the customers The information
technology has proved to be progressive to all the banks Financial Institution
And using of internet and software in their functioning have helped bank to
expand their business in various segments. Information technology has played
an increasingly important role in the rapid growth of the Gold Loan market.
Technology provides scalability to Gold Loan businesses, enabling quick roll-
out of branches and efficient penetration of the underserved markets. Provision
of accurate real-time information has led to faster decision making and reduced
turnaround time for Loan disbursals Technology has significantly reduced
human intervention and thereby, the approval, disbursal and repayment
processes have become much faster, simpler and more robust.
1.5 Structure of players in gold loan market
Borrowing against gold is one of the popular instruments based on physical

pledge of gold and it has been working well with Indian rural households
mindset, which typically views gold as an important saving instrument that is
liquid and can be converted into cash instantly to meet any urgent needs
Traditionally the instant Gold Loan was borrowed from local jeweller or pawn
broker This jeweller has their own procedures and policies which is
Unorganized and informal The procedures and policies differ from jeweller to

jeweller and from pawn broker to pawn broker Sometimes procedures and
policies it is depend on personal relation between lender and borrowers In
addition to a growing Organized Gold Loans market, there is a large long-
operated, Unorganized Gold Loans market which is believed to be several times
the size of Organized Gold Loans market.
1.6 Indian scenario about the gold loan
A recent KPMG report predicts that value of organized gold loan market in
India will grow to Rs 3,10,100 crore by 2020 at a three-year compounded
annual growth rate (CAGR) of 13.7 per cent. In 2015-16, the gold loan market
in the country had recorded a 10.82 per cent growth with a value of Rs 1,96,600
crore. The report predicts organized gold loan market in the country to grow to
Rs 2,39,100 crore in 2017-18 with a growth of 11.8 per cent and to Rs 2,74,000
crore in the next financial year with a growth of 14.6 per cent.

However, factors like increasing regulations, low future outlook for gold prices
in the next 2-3 years, evolving saving pattern of consumers, data security etc
will be challenges for the industry, warns the report.
India is one of the largest consumers of gold with an estimated stock of 23,000
tonnes. About 40 per cent of the gold loan market is in South India. Public
sector banks and NBFCs like Muthoot Finance and Manappuram control nearly
81 percent of the organized gold loan market. Informal players in the sector like
pawn brokers and money lenders, which are unregulated, control 40-60 percent
of the gold loan transactions in the country.
1.7Global scenario about the gold loan
At the Global level gold loan market size is rapidly growing and apart from
traditional demand for household jewellery consumption, industrial use and
investment purpose, it has seen that the central banks tends to accumulate gold
and diversify their foreign exchange reserves during the time of the financial
turbulence. The gold pledge loan, in order to avoid the loan risk caused by the
fluctuation of the gold market price, the borrowers and the borrowers need to
set up and abide by the cordon line and the flat line of the pledge of gold.
Recently many current account surplus countries from Asia, Central Asia and
Latin America have preferred buying large quantities of gold to diversify their
foreign exchange reserves. More recently, the global demand for gold is
underpinned by increased demand in China, continued Central bank purchased
and inflows into gold related exchange-traded funds (ETFs).

1.8 Future challenges of Gold loan
Gold loan sector in India has undergone a significant transformation over the
past few years and has come to be recognized as systemically important
components of the financial system and it is growing quite consistently year-on-
year. Gold loan companies are playing a critical role for the development of
core infrastructure, transport, employment generation, wealth creation,
economic development, to finance economically weaker sections and
considerable contribution to the state exchequer. Despite recording robust
growth, the gold loan market share has been dominated by large players, while
many small players have struggled to scale up operations profitably. The Gold
loan lending model is also under pressure as a result of increased internal
and external forces such as:
 Stiff competition from incumbents and the entry of Fintech players.

 Dynamic regulations that are increasing the cost to comply and are
restricting the ability to freely impose pricing.
 Technology advances that are enabling customization, real-time and
social mobility.
 Levels of customer expectation are rising, the need for 24×7 pervasive
experience.
 Economic volatility, shrinking credit performance and pricing pressure as
a result of eroding margins.

CHAPTER 2
RESERCH DESIGN
2.1 Introduction
Design is the creation of a plan or convention for the construction of an object,

system or measurable human interaction (as in architectural blueprints,
engineering drawings, business processes, circuit diagrams, and sewing
patterns) Design has different fields. A research design is the framework or
guide used for planning, implementation, and analysis of a study. It is a
systematic plan of what is to be done, how the data will be analyzed.
A research design is the set of methods and procedures used in collecting and
analyzing measures of the variables specified in the research problems research
study. The design of the study design defines the type (descriptive, correlation,
semi-experimental, experimental, review meta-analytic) sub type (e. g.
descriptive longitudinal case study), research problem, hypothesis, independent
and dependent variables, experimental design, and if applicable, data collection
methods and a statically analysis plan. Research design is the framework that
has been created to find answers to research questions.
2.2 Meaning
A research design is the conceptual structure with in which the research would
be conducted. It informs what, where, when, how much, by what means a
research study is to be conducted.

2.3 Review of literature
Nandakumar V P (2010): stated that the Organized Gold Loan segment is

potentially a vehicle for social transformation Gold Loan must be made a part
of this process In rural areas, lack of access to bank, poor invest in gold The
distress faced by Indians Farmers needs to move on multiple fronts in extending
timely credit to the rural masses. The author has presented and analyzed the
distress and lack of access to banks in rural areas.
Banking products and services (2010): has been stated that the Banks and
NBFCs have started attracting the borrowers by providing Loans against the
pledge of gold jewelry The jewelry is weighed and its purity is certified by
Organized Financial Institution gold smith The value of gold is decided as per
the extant market price The interest rate will be same as applied to Personal
Loan, but some institutions are giving attractive interest rate on gold pledged
The provision of the gold Control Act is also taken into consideration.
Verma A (2012): Verma A explained that how the Reserve bank of India
(RBI) has raised the loan-to-value (LTV) ratio of the Nonbanking, finance
companies lending money against gold to 75% percent from 60% percent
earlier, so as to facilitate the monetization of idle gold, according to a
notification by RBI. The norms are expected to bolster the loan books growth of
gold loan companies. The central banks said this is in view of moderation in
growth of gold loan portfolios of NBFCs in the recent past. RBI had brought the
permissible LTV ratio to 60% percent in march2012 through it had hinted that it
may relax this rule. The Author has dealt with the important aspect of gold loan,
i.e. LTV ratio for the NBFCs and its importance in monetization.

Economics times dated (2012): George M G Muthoot chairman of India‟s

largest gold company Muthoot finance , gave his review on the change in
regulation and said, “This move by the apex regulatory body will help the
cause of financial inclusion and is an acknowledgement of the growing
significance of gold financing NBFCs in fuelling micro economies in the
country. This will help the un-banked rural and semi-urban customers get more
value against their assets and prevent them from going back the unorganized
sector.” His statement emphasis on shifting of consumer from unorganized to
organized Gold loan. He also out pointed out the growing importance of gold
financing.
Churiwal amith and Shreni ashish (August 2012): have given the overview
of growing gold demands. They highlighted various aspects of Gold Loan from
traditional pawn broker to shifting of Gold Loan to NBFC They also explained
the emerging importance of the Gold Loan to the borrowers as well as lender
due to its movement from traditional lenders to Organized lenders They also
explain the important factors like the rise in borrowing costs due to removal of
agricultural sector status on Loans NBFCs are growing through Gold Loan
compare to organize banks It has become the effective means of meeting the
demand for Micro-finance in India.
Nair Dnyanesh (2012): discussed that the Organized Gold Loan market has
grown tremendously over a period of time, owing to the changing consumer
Perception about Gold Loan and rising Loan requirements. The Perception of
consumers towards Gold Loan has changed drastically The author has discussed
the Changing consumer Perception and rising Loan requirement of consumers
He has pointed out the growing demand of rising Loan requirements.

The Indian bullion and jewelers Association Ltd (2013): The Indian bullion
and jewelers Association ltd, (2013) have given details that in order to
standardize the valuation and make it more transparent to the borrower, it has
been decided that gold jewellery accepted as security/collateral will have to be
valued at the average of the closing price of 22 carat gold for the preceding 30
days as quoted by the Indian Bullion and jewelers Association Ltd. This is
important step by the Indian Bullion and Jewelers Association Ltd which will
standardize the valuation.
Report on Indian bullion market (2013): It has been explained in the report
that the Golden Jewellery soft, yellow, resistant, the most malleable and ductile
metal, occurring in veins and alluvia deposits and recovered by mining or by
panning or sluicing. good thermal and electrical conductor, gold is generally
alloyed to increase its strength, and it is used as an international monetary
standard, in jewelry, for decoration, and as a plated coating Money; riches A
light olive- brown to dark yellow, or a moderate, strong to vivid yellow.
Something regarded as having great value or goodness: a heart of gold. The
American Heritage Dictionary pointed out the various advantages of gold as
metal.
Sikka, Sundeep (2014): Sitka Sundeep, Chief Executive Reliance Capital

Asset Management, said lending against gold ETFs was not wide spread The
majority of investors coming into these funds were retail investors. He said that
I don‟t believe they look to leverage the product in such a manner On an
industry-wide basis, I don‟t believe that the practice of using gold ETFs to
obtain Loans is of any significant scale, he said.

Ram Singapore (2014): Ram Singapore, general manager, Central Bank of

India said that the Advances against gold ETFs and mutual funds in the retail
segment are negligible. In institutional segment too there are not big advances,
said Ram Singapore, general Manager, Central Bank of India RBI has further
clarified that no advances be given by NBFCs against bullion or primary gold
and gold coins.
By M S Sibi (2014): covers the gold loan protection practices among borrowers
in financial institution. The aim of this paper is to collect the borrowers opinion
towards protection practices fallowed by Banks and NBFCs. The aim was
achieved through a descriptive study involving a survey.
Gold ETFs (2015): Gold ETFs Exchange Trade Fund had assets under
management of Rs 11,648 crore at the end of the March quarter according to
data from the Association of Mutual Funds in India Companies accounted for
the bulk of the assets, at Rs 6,345 crore; retail investors were second with Rs
3,124 crore Banks, foreign institutional investors and wealthy individuals
accounted for the remaining amount.
By jasvindarjit kauri (2016): India is known to be the largest importer of gold

in the world. Indians have strong fascination and high sentiments to posses the
gold resultant, the gold loan market also shown vigorous growth in the recent
years. Gold loan NBFCs has created a remarkable position for themselves in the
process of economic development and financial inclusion by monetizing the
idle gold stock of the country on one hand.
V P Nandakumar (2016): VP Nandakumar CEO Mannapuram General

Finance and Leasing commented that the Gold Loan aid financial inclusion;

financial inclusion or inclusive financing is the delivering of financial services

at affordable costs to sections of disadvantages and low-Income segments of
society.
2.4 Research problem/ Statement of the problem
This study will help us to understand the consumer satisfaction about services
and products of the manappuram finance ltd. This study will help to
understanding the gold loan. How a consumer selects, organizes and interprets
the quality of service and products offered by manappuram finance ltd. The
market is more aware and realistic about gold pledging and interest on gold
from the manappuram finance ltd. In this background this study tries to analyze
the customer satisfaction towards the services and products of the gold loan.
2.5 Objectives of the study
Specifically the study tries to
1. To know the purpose for availing gold loans by the respondents.

2. To study about consumer awareness and delight/satisfaction about
operational services and procedures of manappuram finance ltd.
3. To analyze satisfaction level of sample respondents
2.6 Scope of the study
This study is limited to the consumers with in Hosadurga Taluk. The study will
be able to reveal the preferences, needs, satisfaction of the customers regarding
the services from manappuram gold loan ltd. It also helps the manappuram

finance ltd for know whether the existing products or services they are offering
are really satisfying the customer‟s needs.
 This study only on Hosadurga Taluk.

 Limited reaches in the Hosadurga Taluk both urban and rural peoples.
 The study consumer delight/perception about the manappuram finance
Ltd.
 The study about the business tactics fallowed to stand against the
competitors.
2.7 Research methodology
a) Research method used: Research method has to be used in this project was
random sampling method has to be used.
b) Sample size: The sample size of my project is limited to 50 people only.

And cover the customers of the manappuram gold loan ltd both rural and
urban peoples.
c) Sampling techniques: The selection of respondents was done on the basis

of convenience sampling and samples are being selected on the basis of ease
or convenience. The respondents who are easily approachable will be
selected in this project.
2.8 Sources of the Data
Two type of data collection primary and secondary data.

Primary data
Primary data refer to the first hand fresh data collected from the field it was
collected through the questionnaire method.
Secondary method
Secondary data refer to the already published information. Secondary data was
collected from various sources magazines, journals, newspapers, internet, and
industry
Research is based on primary secondary data research has been done by

primary data collection and primary data has been collected by interacting with
various people in Hosadurga city. The secondary data has been collected
through various journals and websites.
2.9 Limitations of the study
 Time is the major constraint.

 Some difficulty getting the people answer the survey questions because
of busy in their work.
 The data collection was restricted only within the Hosadurga Taluk.
 Respondents were limited (50 sample) in terms of size and composition.

Chapter scheme
Chapter 1: Introduction chapter covering the introduction about the Gold

loan, Gold loan interest rates, Customer delight meaning and Definition, Role
of technology in rapid growth of the gold loan, Structure of players in gold loan
market, Indian scenario about the gold loan, Global scenario of the gold loan
Future challenges of NBFC‟s.
Chapter 2: Introduction about the research design, Meaning, Definition,

Review of literature, Research problem/ statement of the problem, Objectives of
the study, Scope of the study, Research methodology, Sources of the Data,
Limitations of the study.
Chapter 3: Overview of the company – logo of the company, vision, mission,

Core values, Head office details, SWOT analysis, Gold loan process, Products
and services, Achievements, Awards and Recognition, Gold loan Schemes,
Documents required for gold loan, Terms and conditions, CSR activity, Five
years Balance sheet.
Chapter 4: Data analysis and Inference with charts.
Chapter 5: Findings, Suggestion, Conclusion.

CHAPTER 3
COMPANY PROFILE
3.1 Overview of the company
Manappuram finance limited (Formerly known as manappuram general finance

and leasing Ltd) is one of the largest NBFCs in India predominantly dealing in
gold loans. It is the second largest listed player in the gold loan segment with a
consolidated AUM of Rs 15765 crore (FY 2018) of which gold loans account
for Rs 11735 crore. It has a strong pan –India presence through its 4119 strong
branch network spread across 24 states and 4 union territories serving a
customer base of more than 3.8 million. In addition to gold finance the
company is focusing on affordable housing finance vehicle and equipment
finance which includes commercial vehicle loans two-wheeler loans tractor &
car loans microfinance SME finance project and industrial finance corporate
finance and insurance broking. The company operates its housing finance
business under its subsidiary Manappuram Home Finance Limited
(MAHOFIN).
Evaluation of the company
Manappuram General Finance and Leasing Ltd was incorporated on July 15

1992 in the wake of economic reforms launched by the Government of India
mainly to take advantage of the importance assigned to Leasing as a vehicle to
promote decentralized pattern of Economic Growth through small and medium
enterprises. During the year 1994-95 the company opened new branches in
Calicut, Guruvayur, Ernakulam and Thriprayar. In the year 2002 they started

Forex business as a part of its diversification. During the year 2002-03 the
company opened 8 new branches in various places. During the year 2004-05 the
company acquired 100% equity shares in Manappuram Insurance Agents and
Brokers Ltd. Also they widened their activities further by opening 14 new
branches in various places. The Board of Directors of Manappuram Finance at
its meeting held on 2 November 2017 approved equity infusion of up to Rs 50
crore in its subsidiary Asirvad Microfinance Limited (Asirvad). The capital
infusion will facilitate Asirvad business growth. Asirvad has pan India
operations. The Board of Directors of Manappuram Finance at its meeting held
on 2 July 2018 has authorized entering into securities purchase agreement in
connection with the company's acquisition of 85.39% of the share capital (on a
fully diluted basis) of Indian School Finance Company Private Limited (ISFC
or Target Entity) from certain existing ISFC shareholders.
Manappuram logo
Vision
Our enduring vision is to energize the vast stock of privately held gold in India.
India‟s households own anywhere from 20000 to 25000 tonnes of gold, the
equivalent of two thirds of the country‟s Gross domestic product (GDP), of
which hardly 10% is monetized. We hope unlock the values of this gold to the

benefit of the common people of India, most of whom have savings in the form
of gold jewellery.
Mission
Our purpose is to bring convenience to the lives of the ordinary people of India,
to „make life easy‟ for them. We provide them with „instant‟ credit at
reasonable rates of interest against their used gold jewellery to enable them to
meet their requirements for short term funds. Our enduring vision is to energize
the vast stock of privately held gold in India. India‟s households own anywhere
from 20000 to 25000 tonnes of gold, the equivalent of two thirds of the
country‟s Gross Domestic Product (GDP),of which hardly 10%is monetized.
We hope to unlock the value of this Gold to the benefit of the common people
of India, most of whom have savings in the form of gold jewellery.
Core values
Customer is all important: Our products aim at delivering value to the

customer. No matter what our customer‟s economic status is, we believe that
time is precious and everyone is entitled to courtesy and prompt service with
high levels of transparency.
No compromise on integrity: We set great store by ethical values and practices

in all our dealings. We believe in transparency and in fallowing the
laws of the land without ambiguity. We value the contributions of all our
stakeholders and we take special pride in recognizing those contributions.
Cutting edge technology: As a pioneer in the introduction of technology into

the gold loan sector, we believe in constantly technology to keep our costs low
and deliver better service to our customers. We have standardized our processes
to allow us better and more cost-effective access to our customers. Further, we

believe in fostering innovation to deliver ever greater value to our customers.
Head office details
REGISTERD ADRESS :
Registered and corporate office : 4/470A (old) W/638 (New), Manappuram
House, Valapad P.O
LISTINGS :
Thrissur, Kerala – 680567

Tel : 0487-3050100, 3050108
Fax : 0487 – 2399298
Email : cosecretary@manappuram.com
Website : https://www.manappuram.com
Name Destination
Mr. V P Nandakumar MD & CEO
Mr. B N Raveendra babu Executive Director
Mrs. Bindu A L CFO
Mr. Manoj kumar V R Company secretary & compliance
officer
KEY MANAGERIAL PERSONNEL :

BSE, COSE, MSE, NSE,
SWOT ANALYSIS
Strengths:
 Strong track record in financing against gold jewellery: Manappuram has

been in the gold-loan business for more than 60 years. Based on this industry
experience, the Company has designed an appropriate assessment and
underwriting methodology.
 Adequate capitalization: The Company has a healthy capital adequacy ratio
of more than 26.98% as on March 31, 2018. Lower asset-side risk also
supports capitalization.
 Stable funding profile: Around 50% of the consolidated borrowing is from
over 30 banks (public and private) and financial institutions, with which the
Company has an established relationship. This source is stable and cost
competitive. Funds are also raised from long-term capital market
instruments such as non-convertible debentures and subordinated debt.
 Strong profitability: Profitability has improved during fiscal 2017. The
substantial improvement is partly attributable to reduced auction losses
consequent to the shift to short-tenure products of three months along with a
focus on regular interest collection.
Weaknesses
 Geographical concentration in revenue: Operations have significant

regional concentration compared with large asset-financing Financial
Statements about Manappuram Governance Reports. South India accounted
for about 60% of total AUM as on March 31, 2018, though this has reduced
from 82% as on March 31, 2012. More than 50% of the microfinance
portfolio is concentrated in south Indian states of Tamil Nadu, Karnataka,
and Kerala.
 Challenges associated with non-gold loan segments: Growth, asset
quality, and profitability in the non-gold loan businesses are yet to stabilize.
Asirvad‟s profitability may be affected on account of increased credit cost
during fiscal 2018.
Opportunities
 Untapped potential: The core business of the Company, of providing gold

loans, continues to offer good growth potential. The World Gold Council
(WGC) estimates privately held gold to be anywhere between 20,000 to
25,000 tonnes in India.
 Level playing field: With the RBI now prescribing a uniform cap on LTV
of 75% for both banks and NBFCs, there is a level playing field which
benefits NBFCs.
 Continuing opportunities in the unorganized sector: It is observed that
proximity to home is an important reason for choosing a given type of
financial institution when availing gold loan.
 Technology innovations: In 2015, the Company had rolled out an advanced
Online Gold Loan product that is cashless and available to the customer
24X7.
Threats
 Gold loans constitute about 81% of the total advances of the Company. A
sharp decline in price of gold within a short period may adversely affect
repayments and also growth prospects of the business.
 Business is highly regulated and it may be adversely affected by future
regulatory changes.
 Financial performance is particularly vulnerable to interest rate risk as the
bulk of funding is raised from banking channels.
 Unexpected regulatory actions by State and Central Governments.
 Greater competition from other NBFC and Banks could impact growth in
AUM and profits.
Competitors of Manappuram finance ltd.
 Muthoot finance gold loan

 Union gold loan
 HDFC gold loan
 IIFL
 SBI Gold loan
3.2 Gold loan process

1. customer 2. Interaction with 3. CCE collecting
approaches CCE Gold
5. Cash handing to 4. Appraisal of gold

customer

3.3 Products and services
Gold loans business
Gold loans
 A wide range of schemes to cater to diverse customer requirements

 No end-use restriction on gold loans
 Doorstep gold loans in pilot mode since may 1
 Loan to value (LTV)linked to the loan tenure
Online Gold loans
 Gold loans offered at the convenience of the borrower

 Gold loans of up to Rs 1.5 crore offered online
 Easy documentation, instant approval, convenient 24*7 online payment
 Hassle-free, paper-less transactions online
 Free safety custody for gold
Micro finance business
 Microfinance institution (MFI) loans under our subsidiary Asirvad

microfinance
 Three types of loans
1. Income Generating Programme (IGP) loan
2. Product loan
3. Small and medium enterprises (SME) loan
 Loan tenure of up to 24 months

Housing finance business
 Home loans under subsidiary- manappuram home finance

 Focus on affordable housing loans for mid-income to low-income groups
 Average loan size of up to Rs 10 lakh
Vehicle finance business
 Loans for new/ pre owned commercial vehicles and refinancing

 Minimum loans starting from Rs 1 lakh
 60- month maximum tenure
Others
SME finance
 Loans provided against the collateral security of property

 Loans amount ranging from Rs 5 lakh to Rs 2 crore
 Tenure of loan ranging from 24 months to 60 months
 10-day turnaround time (TAT)
Forex and money transfer
 Fast, easy and safe money transfer

 No bank account needed for amount of up to Rs 50000
 Send cash anywhere in India within seconds
 Send money abroad
 Reserve bank of India (RBI) certified
Insurance broking

 Housed under our 100% subsidiary – manappuram insurance brokers

limited
 Provides insurance broking services for all lending players
3.4 Achievements
Soon after it commenced its operations, the company gathered several “firsts”
to its credit. The first non banking financial company (NBFC) in kerala to
receive a certificate of registration issued by the RBI.
It was also among the earliest to go for an IPO in 2007, It became the first
kerala based NBFC to receive investment from foreign institutional investors
(FIIs) when the celebrated PE fund, sequoia capital, invested Rs.700 million
along with Hudson equity holdings.
Sizable foreign investment was received during two QIPS in 2010, it became
the first kerala-based NBFC to offer ESOPs (employee stock option plan) to its
middle and senior management functionaries.
3.5 Awards and Recognition
2015: Awarded Jury‟s special commendation at the Golden peacock Awards for
CSR. Acquired the Chennai based MFI, Asirvad microfinance Pvt ltd. In
February diversified into new business areas such as home loans and
commercial vehicle finance. Launched online gold loan(OGL) in
September/October becoming the first in the industry to do so.
2016: V.P.Nandakumar , MD&CEO is one of the select few from India to be

shortlisted for the CNBC Asia business leaders award 2016 held at Jakarta,

Indonesia, on November 23 Acquired100% ownership of manappuram

insurance broker‟s private limited.
2017: Awarded „best NBFC for gold loan business‟ by the India bullion
jewellary association Mumbai, on march 16 at Mumbai , co-branded pre-paid
money card in tie up with YES bank and the makash card e-wallet launched on
April 15. The company‟s shares are included in the derivative segment (future
& options) at NSE, effective June 30.
2018: Mr.V.P.Nandakumar, MD & CEO was among the 16 finalists at the

prestigious Ernst and young entrepreneur of the year awards 2017, held in
Mumbai on February 15, 2018.
3.6 Manappuram gold loan schemes
Privilege loan (GL-PL): Tenure is up to 90 days and the interest rate slab
ranges from 18% to 24%.
Super express loan (GL-SX): Tenure is up to 90 days and the interest rate slab
ranges from 23% to 25%
Express loan (GL-SX): Tenure is up to 180 days and the interest rate slab
Value for money (GL-VM): Tenure is up to 270 days and the interest rate slab
Super loan (GL-SA): Tenure is up to 365 days and the interest rate slab ranges
from 22% to 26%

Samadhan gold loan (GL-SA): Tenure is up to is up to 365 days and the

interest rate slab ranges from 14% to 25%. An amount permitted in this scheme
is Rs.75000/- in kerala branches and Rs.50000/- in outside kerala branches. For
women customers- 1 lakh
GL B1-N: Tenure is up to 365 days and the interest rate slab ranges from 22%
to 24%. Minimum loan amount is Rs.5 lakhs.
GL B1+N: Tenure is up to 365 days and the interest rate slab ranges from 22%
to 24%
GL B2+: Tenure is up to 365 days and the interest rate slab ranges from 16% to
24%. Before availing one should look for overdue charges, her they charge at
3% per annum after loan tenure. Interest is calculated on monthly by
compounding.
3.7 Documents required for gold loan
The Gold Loan requires some basic documentation, the basic documentations
required as follows
 Identity proof such as Passport, Voters ID or driving license

 Address proof such as Electricity bill, Ration card, Telephone bill etc
 For signature proof one needs to submit own Passport copy, Driving
license or any other documents with own signature.
 Two Passport size photographs.
 As gold is being pledged in Gold Loan, therefore gold is an important
element But to secure the gold given as well as accepted it required above
documentation This gives proper records of the gold holders and its

authentication is required And thus the Gold Loan is considered to be a

secured Loan because of pledging of gold assets at the time of borrowing.
Manappuram gold loan calculator
Manappuram offers highest gold loan per gram of Rs.2345 at today‟s average
gold price of Rs.31260 for 22 carat gold..
Eligibility criteria Manappuram Gold Loan
Gold loan per gram Rs.1918 to Rs.2345 depending up on

the purity of gold
Age of borrower 18 years
Maximum loan amount Rs. 1 crore
Maximum loan to gold value ratio Up to 75%
Purity of eligible gold 18 carat to 22 carat
Maximum loan tenure 12 months
Lowest EMI per lakh Rs. 8885

Manappuram gold loan rate per gram by gold purity
The Following table gives an approximate estimate of gold loan per gram
manappuram bank will offer against gold jewellery of different purity levels at
a maximum LTV of 75% and lower LTV of 65%.
Manappuram
Gold rate per Manappuram
lowest gold loan
Gold purity gram-average best gold loan
per gram
of past 30 days per gram
22 carat 31260 2345 2032
20 carat 28419 2345 1847
18 carat 25577 1918 1662
3.7 Terms and conditions

i. The Borrower confirms to have fully read and understood the various
schemes offered by the Company and based thereon, the Borrower has
requested/selected to avail the Loan under the scheme as mentioned in
pawn ticket.
ii. The Borrower confirms that the stones fixed in the pledged gold ornaments
/items, if any, do not have any market value and that the said gold
ornaments /items is/ are the absolute and unencumbered property of the
Borrower and no other person has any right, title, interest or claim thereon.
iii. The Borrower confirms that all particulars/details given in the applications
are true and correct and no information has been suppressed/ with held.

iv. The Borrower shall pay interest at the rate specified in the Pawn ticket and
incidental charges as applicable to the loan. When interest is not paid at
monthly intervals, the interest shall be compounded on a monthly basis.
Interest will be calculated on the basis of 365 days a year on the amount
outstanding.
v. The loan is based on the weight, purity and existing market value of the
Gold.
vi. The Company will make only a preliminary verification of the Gold and
the Company has the right to further check the purity / weight of the Gold
internally or by experts at any point of time if required, at the Company's
sole discretion, at the cost and expense of the Borrower.
vii. The period of Loan is as mentioned in the pawn ticket and the Borrower is
required to repay the loan along with interest on or before the completion
of loan tenure, as specified in the pawn ticket from the date of
disbursement.
viii. The postage charges, as revised from time to time at the discretion on the
Company, shall be recovered from the respective account.
ix. If full repayment of the loan, along with interest and charges, is not made
within the period of the loan (as specified in the pawn ticket ) or within
such period as demanded by the Company, the Company shall have the
right to sell or otherwise dispose of the Gold through public auction at the
risk and cost of the Borrower.
x. Further, the Borrower understands and acknowledges that the Company
shall subject to auction, all accounts remaining fully or partially unsettled
after expiry of the loan tenure, as specified in the pawn ticket or otherwise.

The Company shall intimate the Borrower by registered letter or courier

service or SMS or
xi. Telephone or personal intimation or e-mail or any other mode of
communication its intent to subject the Gold to public auction well before
the proposed auction date.
xii. In the event of loss of pledged Gold due to theft, burglary or for any other
reasons from the custody of the Company, the liability of the Company
shall be limited to replacing the lost Gold with equal net weight as
mentioned in the loan application form / pawn ticket.
xiii. For clarifications or complaints, the Borrower may contact the Customer
Services Cell on Toll Free No. 1800 420 22 33 or by post at Manappuram
Finance Ltd. CIN-L65910KL1992PLC006623 IV/470A (old)
W638A(New), Manappuram House, Valapad, Thrissur, Kerala - 680 567 or
by email to crm@manappuram.com giving the name of the branch and
account number. Etc…
CSR Activity covered by Manappuram finance limited
Manappuram finance limited stands at the front of society to upgrade the lives
of people under below poverty line. The main intension of manappuram
foundation is to bring a sustainable change and growth in marginalized people
in society. Manappuram foundation started at Thrissur, near Valapad on
October and it also intended to spread its wings across the country. The
foundation works for the betterment of the Health sector, Education, Women
empowerment, and other social sectors. Apart from the title of cooperative
institute, they always strive to protect the social concerns of the society through

some gentle invasions. Manappuram also enacted in the front to accomplish

their social responsibilities. It‟s been half of the century, Manappuram have
been part of the philanthropist activities.
CSR financial details (INR Cr.)
Year 2017-2018 2016-2017 2015-2016

Actual CSR 11.24 Cr 9.19 Cr 4.17 Cr
Prescribed CSR 8.69 Cr 7.08 Cr 6.17 Cr

5 Years Balance sheet of manappuram finance limited

(INR Cr.)
Liabilities 2014 2015 Assets 2014 2015
Share capital 168.24 173.24 Loans 2.14 106.03
Total reserves 2323.50 2464.56 Net block 202.13 205.54
2491.74 2637.80 Non- current 5.00 5.05

Shareholder‟s
investment
fund
Other non-
Minority interest - 15.39 current assets 218.05 230.10
Current
Long-term
investments
1454.64 1641.91 790.60 211.82
borrowings
Cash and bank 844.47 792.11
Other noncurrent balances
272.56 110.12
liabilities Short term loans
and advances 8182.87 9447.92
Current liabilities
6619.52 7211.06 Other current 588.67 616.61
assets
Miscellaneous
- -
expenses(not
written off)
10838.46 11616.28 103838.46 11616.28

Liabilities 2016 2017 Assets 2016 2017
Share capital 168.24 168.38 Loans 483.78 758.61
Total reserves 2589.80 3193.42 Net block 230.33 221.89
3361.80 Non- current

Shareholder‟s fund 2758.04 5.05 5.05
investment
23.84
Minority interest 21.20
Other non-current
3122.41
assets 226.94 256.30
Long-term 1600.01
Current 44.01 -
borrowings
124.03 investments
604.48 555.43
Other noncurrent 126.97 Cash and bank
liabilities balances
8332.94 8520.27
Short term loans 10844.15 12992.10
Current liabilities
and advances
Other current 400.42 362.36

assets
Miscellaneous
expenses(not - -
written off)
12839.15 15152.35 12839.15 15152.35

Liabilities 2018 Assets 2018
Loans
Net block 1200.07

168.51
Non- current investment 310.00
3667.70
Share capital
Other non-current assets 5.05
Total reserves 3836.20
Current investments 331.33
Shareholder‟s fund 26.68 -

Cash and bank balances
2696.25 Short term loans and 698.65
Minority interest
advances 14313.70
75.60
Long-term borrowings
Other current assets
Other noncurrent
373.51
liabilities 10597.73 Miscellaneous expenses(not
written off)
Current liabilities
-
17232.46
17232.46

CHAPTER 4
DATA ANALYSIS AND INFERENCE
4.1 Table showing classification of Age of the Respondents
Age No. Of Respondents Percentage (%)

Below 20 11 22
21-30 12 24
31-40 13 26
Above 40 14 28
Total 50 100
Source: (Primary Data)
Graph No–4.1Graph showing classification of Age of the

respondents
Respondents classification on the basis of

Age
No. Of Respondents Percentage (%)
26 28
22 24
12 13 14
11
Below 20 21-30 31-40 Above 40
Inference: In the above table it shows that information regarding the age group
of the Respondents. Below 20 years age of the respondents is 11%. 21-30 years
age of the Respondents is 12%. 31-40 years age of the Respondents is 13%. 40
years and above of the Respondents is 14%.
4.2 Table showing classification of Gender of the Respondents
Gender No. of respondents Percentage (%)
Male 21 42
Female 29 58
Total 50 100
Source: (primary data)
Graph No – 4.2 Graph showing classification of Gender of the

Respondents
classification on the basis of Gender

Male Female
58
42
29
21
No. of respondents Percentage %
Inference: In the above table shows information regarding the gender of the
Respondents. 42% respondents are male and remaining 58% respondents are
female out of the 50 respondents.

4.3Table showing the marital status of the Respondents
particulars No. of respondents Percentage (%)
Married 37 74
Un married 13 26
Total 50 100
Source: (Primary data)
Graph No – 4.3 Graph showing the marital status of the

Respondents
Married Un married
13 26
37 74
Inference: In the above table shows information regarding the marital status of
the Respondents. 74% of respondents are married and 26% of respondents are
unmarried out of 50 respondents.

4.4 Table showing the classification of Educational qualification of

the Respondents
Educational qualification No. of Respondents Percentage (%)

Un-educated 5 10
S.S.L.C 13 26
Pre-university 1 2
Degree 18 36
Post-graduation 8 16
Others 5 10
Total 50 100
Graph No – 4.4 Graph showing the classification of Educational

qualification of the Respondents
Educational qualification
others
10% un educated
10%
post graduation
16% sslc
26%
degree
36%
pre university
2%
Inference: In the above table shows information regarding the educational

qualification of the Respondents.10% of respondents are uneducated, 26% are
S.S.L.C qualification, 2% are pre-university qualification, 36%are degree
qualification, 16%of respondents are post graduation, 10%are other
qualification out of 50 respondents.

4.5 Table showing classification of Occupation of the

Respondents
Occupation of the No of Respondents Percentage (%)

Respondents
Former 6 12
Government employee 6 12
Business man 15 30
Private employee 6 12
Others 17 34
Total 50 100
Graph No – 4.5 Graph showing classification of Occupation of the

Respondents
Occupation of the Respondents

Former
12%
Others
34% Government
employee
12%
Private employee Business man
12% 30%
Inference: In the above table shows information regarding the occupation of

the Respondents. Formers are 12%, government employees are 12%, business
mans are 30%, private employees are 12%, other occupations are 34% out of 50
members.

4.6 Table showing classification of Annual income of the

Respondents
Annual income No. of Respondents Percentage (%)

Less than 100000 23 46
100001 to 500000 1 2
500001 to 1000000 26 52
1000000 above 0 0
Total 50 100
Graph No – 4.6 Graph showing classification of annual income of

the Respondents
No. of Respondents
0%
46% Less than 100000

52% 100001 to 500000
500001 to 1000000
1000000 above
2%
Inference: In the above table shows information regarding the annual income
of the Respondents. Less than 100000 income of respondents is 46%, 100001 to
500000 income of respondents is 2%, 500001 to 1000000 income of
respondents is 52%, 1000000 and above income of respondents is 0% out of 50
respondents.

4.7 Table showing respondents awareness about the concept of

gold loan
Particulars No. of Respondents Percentage (%)
Yes 35 70
No 15 30
Total 50 100
Graph No – 4.7 Graph showing respondents awareness about the

concept of gold loan
Yes No
70
35
30
15
No. of Respondents
Percentage%
Inference: In the above table shows information regarding the awareness

of the concept of gold loan by the Respondents. 70% of respondents are
aware about the gold loan and 30% of respondents are not aware the
concept of gold loan out of 50 respondents.

4.8 Table showing How the respondents get information about

gold loan
Advertisements 12 24
Friends and colleagues 15 30
Family and relatives 10 20
Others 13 26
Total 50 100
Graph No – 4.8 Graph showing how the respondents get

information about gold loan
No. of Respondents Percentage %
30
26
24
20
15
12 13
10
Advertisements Friends and Family and Others

colleagues relatives
Inference: In the above table shows information regarding the

respondents are get information about gold loan. From advertisements are
24%, from friends and colleagues are 30%, family and relatives are 20%,
from others are 26% from the 50 respondents.

4.9Table showing How many times respondents taken loan

from manappuram finance limited
One time 22 44
Two times 19 38
Three times 6 12
More than three times 3 6
Total 50 100
Graph No- 4.9 Graph showing how many times respondents

taken loan from manappuram finance limited
44
38
22
19
12
6 6
3
One time Two times Three times More than three times
Inference: In the above table shows information regarding the times of loan
taken by the Respondents. 22 respondents are one time loan taken, 19
respondents are two times loan taken, 6 respondents are three times loan taken,
3 respondents are more than three times loan taken out of 50 respondents from
manappuram fin ltd.

4.10 Table showing respondents opinion about interest charged

by the manappuram finance limited
Very high 20 40
Reasonable 25 50
Low 5 10
Total 50 100
Graph No – 4.10 Graph showing respondents opinion about

interest charged by the manappuram finance limited.
10%
40% Very high

Reasonable
Low
50%
Inference: In the above table shows information regarding the Respondents

opinion about interest charged by manappuram fin ltd. 40%of Respondents
opinion about interest rate is very high, 51%of Respondents opinion about
interest charged is reasonable and 10%of Respondents opinion about interest
charged is low from 50 respondents.

4.11 Table showing Branch staff have the required skills and
knowledge about products and services of manappuram
finance limited
Excellent 13 26
Good 23 46
Average 11 22
Poor 3 6
Total 50 100
Graph No – 4.11 Graph showing Branch staff have the
required skills and knowledge about products and services of
manappuram finance limited
46
60
26
40 22
13 23
20 11 6 No. of Respondents
0 3 Percentage %
Excellent Good
Average
Poor
Inference: In the above table shows information regarding the branch staff
have the required skills and knowledge about products and services of
manappuram fin ltd. 26% respondents opinion is excellent, 46%
respondents opinion is good, 22% respondents opinion is average and 6%
respondents is poor skills and knowledge about products and services of
manappuram fin ltd from 50 respondents.

4.12 Table showing How long respondents have been dealing

with manappuram finance limited

Less than 1 year 25 50
1 to 2 years 10 20
2 to 3 years 8 16
More than 3 years 7 14
Total 50 100
Source: Primary data
Graph No – 4.12 Graph showing how long respondents have

been dealing with manappuram finance limited
Less than 1 year 1 to 2 years 2 to 3 years More than 3 years
14%
16%
50%
20%
Inference: In the above table shows information regarding the how long
respondents are dealing with the manappuram finance limited. 50% of
respondents are dealing less than 1 year, 20% of respondents are dealing 1 to 2
years, 16% of respondents are dealing 2 to 3 years, 14% of respondents are
dealing more than 3 years out of the 50 respondents.

4.13 Table showing Which purpose has respondents drawn gold

loan from manappuram finance limited
Housing 8 16
Education 14 28
Health 7 14
Others 21 42
Total 50 100
Graph No–4.13Graph showing which purpose has respondents

drawn gold loan from manappuram finance limited
50 42
40 28
30 21
16 14 14
20 8 7
10
0
Housing Education Health Others
No. of Respondents Percentage
Inference: In the above table shows information regarding which purpose

of respondents drawn gold loan from manappuram fin ltd. 16% respondents
are housing purpose, 28% respondents are education purpose, 14%
respondents are health purpose, 42% respondents are other purpose has
respondents drawn gold loan from manappuram fin ltd.

4.14 Table showing the employees are helpful in giving

information about services of manappuram finance limited
Particulars No. of respondents Percentage (%)
Strongly agree 14 28
Agree 17 34
Neutral 15 30
Disagree 1 2
Strongly disagree 3 6
Total 50 100
Graph No – 4.14 Graph showing the employees are helpful in

giving information about services of manappuram finance limited

34 30
28
14 17 15
2 3 6
1
Strongly Agree Neutral Disagree Strongly

agree disagree
Inference: In the above table shows information regarding the employees are
helpful in giving information about services of manappuram fin ltd. 28% of
respondents are strongly agree, 34% of respondents are agree, 30% of
respondents are neutral, 2% of respondents are disagree, 6% of respondents
are disagree with the statement from 50 respondents.

4.15 Table showing respondents are satisfied with the time taken
by manappuram finance limited in fact successful
transaction

Yes 40 80
No 10 20
Total 50 100
Graph No – 4.15 Graph showing respondents are satisfied with

the time taken by manappuram finance limited in fact
successful transaction
Yes No
80
40
10 20
No. of Respondents
Percentage %
Inference: In the above table shows information regarding the

satisfaction with the time taken by manappuram fin ltd. 80% of
respondents is satisfied with time taken by manappuram fin ltd and 20%
of respondents are not satisfied out of 50 respondents.

4.16 Table showing respondents are satisfied with the

documentation procedure fallowed by manappuram finance
limited
Particulars No. of Percentage (%)

respondents
Yes 39 79
No 11 21
Total 50 100
Graph No – 4.16 Graph showing respondents are satisfied with

the documentation procedure fallowed by manappuram finance
limited
Yes No
79
39
21
11
Inference: In the above table shows information regarding the respondents is

satisfied with the documentation procedure fallowed by manappuram fin ltd.
79% of respondents are satisfied and 21% of respondents are not satisfied with
the documentation procedure out of 50 respondents.

4.17 Table showing Comparing the services of other banks with

the services of manappuram finance limited
Particulars No. of Percentage (%)
Respondents
Excellent 8 16
Good 21 42
Satisfactory 18 36
Poor 3 6
Total 50 100
Graph No – 4.17 Graph showing comparing the services of other

banks with the services of manappuram finance limited
42
36
16
8 21
18 6
3
Excellent
Good
Satisfactory
Poor
Inference: In the above table shows information regarding the comparing the
services of other banks the services of manappuram fin ltd. 16% of respondents
are excellent, 42% of respondents are good, 36% of respondents are
satisfactory, 6% of respondents are poor in comparing service of other banks
with manappuram fin ltd.

4.18 Table showing Being a customer of manappuram finance

limited do respondents avail the services from other bank
Particulars No. of Respondents Percentage( %)
Yes 37 74
No 13 26
Total 50 100
Graph No – 4.18 Graph showing being a customer of

manappuram finance limited do respondents avail the services
from other bank
74
80
60
37
40 26
13
20
0
Yes No
Inference: In the above table shows information regarding the being a

customers of manappuram fin ltd do avail service from other bank. 74% of
respondents are avail services from other bank, 26% of respondents are not
avail services from other bank.

4.19 Table showing respondents will recommend manappuram

finance limited to their friends and relatives

Definitely 14 28
Probably 22 44
May or may not 14 28
Total 50 100
Graph No – 4.19 Graph showing respondents will recommend

manappuram finance limited to their friends and relatives
Definitely Probably May or may not
28% 28%
44%
Inference: In the above table shows information regarding the respondents will
recommend manappuram fin ltd to their friends and relatives. 28% of
respondents are will recommend definitely, 44% of respondents are will
probably recommend, 28% of respondents are may or may not recommend to
their family and friends.

4.20 Table showing respondents like to continue their relation

with manappuram finance limited
Particulars No. of Respondents Percentage(%)

Yes 43 86
No 7 14
Total 50 100
Source: (primary data)
Graph No – 4.20 Graph showing respondents like to continue

their relation with manappuram finance limited
Yes No
86
43
7
14
No. of Respondents
Percentage %
Inference: In the above table shows information regarding the respondents like
to continue their relation with manappuram fin ltd. 86% of respondents are like
to continue their relation and 14% of respondents are not like to continue their
relation with manappuram fin ltd.

CHAPTER 5
FINDINGS, SUGGESTIONS AND CONCLUSION
FINDINGS:
 From the above survey I found that most of the respondents were female
and remaining are male respondents and most of the married peoples are
taking gold loan
 Most of the respondents are aware about gold loan, getting information
from the friends and colleagues and respondents are one time taking loan
from manappuram finance ltd.
 Respondents opinion is Reasonable interest were charged by
manappuram finance ltd and also branch staff having good skills and
knowledge about products and services
 Many respondents are dealing with manappuram finance ltd is less than 1
year and drawn gold loan for the purpose for fulfilling their other needs.
 Employees are helpful in giving information about services of
manappuram finance ltd is respondents are agree with this statement and
also respondents are satisfied with time taken and documentation
procedure fallowed by manappuram finance ltd.
 Being a customer of manappuram finance ltd the most of the respondents
are avail services from other bank
 Comparing the services manappuram finance ltd with the other banks is
most of the respondents opinion is giving the good services for the
customers in manappuram finance ltd.

 Most of the respondents are like to continue their relation with

manappuram finance ltd and many respondents are probably
recommended the manappuram finance ltd to their friends and relatives.
SUGGESTION
Manappuram fin ltd is one of the leading gold loan company it having the many
branch in all over the country.
Some suggestions are to improve for giving the better service to the customers
so some suggestions are fallows below:
 To give the more information about the schemes offered by the gold loan
because peoples are not awaring the services and products are offered by the
company
 To reducing the interest rate and it helps to the attracting the customers so to
reducing the interest rate on the gold loan.
 To reducing the late penalty rates on the gold loan so it helps for the people
 To build customers awareness about the gold loan and give some
advertisements and it creates awareness about gold loan.
 To introducing much more products for peoples so it attracts the peoples and
it is advantage to the company and also the peoples who have their gold loan
need.

CONCLUSION
India is the largest consumers of gold and about 40 percent of the gold loan
market is in south India. Public sector banks and NBFCs companies control
nearly 81 percent of the organized gold loan market. Informal players in the
sector like pawnbrokers and money lenders, which are unregulated, control 40-
60 percent of the gold loan transactions in the country.
For borrowers, gold loans have emerged as one of the best means of raising
quick, short-term capital. For lenders, gold loans are more advantageous
compared with home loans and car loans because of shorter tenures, lower
processing time and cost, and greater returns due to higher interest rates. These
factors, along with everyone wanting a piece of this action, the organized sector
is challenging the large unorganized gold loan market dominated by
pawnbrokers and money lenders, with NBFCs leading the pack due to simpler
approval and disbursal processes, flexible products and better accessibility.
On the basis of the study it is found that manappuram finance limited is good
services provider than the other banks because of their good personalized
advice on gold loan, faster services and it also provides the information through
the internet and mobile alerts and giving the information about various products
and the services are offered by the manappuram finance limited and the
company should focus on the advertising strategy and also the marketing of the
gold loan product.

Bibliography
Books
 C.R. Kothari (2009). ”Research methodology: methods and techniques”
(Second revised edition), New age international publishers, New Delhi.
 Nandakumar.v.p. (2010).”Social relevance of gold loan, Delhi, India”.

 Banking products and services (2010).” Indian institute of banking and
finance”.
 Verma A, (2010). “RBI raises loan-to-value ratio for gold loan firms to
75% India”.
 Churiwal Amith and Shreni Ashish (August, 2012)”surveying the Indian
gold loan market”, publication: Cognizant 20-20.
 Nair Dnyanesh N (2012). Changing consumer perception driving India‟s
organized gold loan market, Mumbai, India.
Newspapers
 The Times of India
 Business standard
 The economic Times
Articles
 Annual report of manappuram finance ltd.
 Gold loan scenario of specific financial companies in India.
 Indian gold loan markets.
 Surveying the Indian- Gold- Loan- Market

Websites
 https://www.manappuram.com
 www.wikipedia.org.com
 Shodhganga

Gold Loan Project

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A study on customers delight towards on gold loan

(with special reference to manappuram finance limited in HSD)

1.1. Introduction to gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 1

1.2 Customer Delight

 Customer delight is surprising a customer by exceeding his or her

 Paul Farris defines customer Delight as “the number of customers, or

Department of commerce (PG) G.F.G.C Hosadurga Page 2

1.3 Genesis of gold loan market in India

1.3.1 Meaning of gold loan

 When a customer pledges gold as collateral for taking a loan, it is known as

Department of commerce (PG) G.F.G.C Hosadurga Page 3

1.3.2 Definition of gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 4

requirement of their children‟s education, marriage and other financial

1.3.3 Features of gold loan

1.3.4 Advantages of gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 6

1.3.5 Gold loan interest rates

 Interest rate will be quoted on annualized basis only.

Risk related rate of interest:

Maximum rate of interest

Penal / overdue interest

1.4 Gold loan in India

1.4.1 Specification of gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 8

% to 26 % in different companies. The risk associated with this is the

1.4.2 The risk associated with gold loan

 Price fluctuation of gold loan:-The fluctuation of gold price make worried

1.4.3 Charges associated with gold loan:

1.4.4 Advice on gold loan

The advice that needs to be followed by borrower is to keep in mind before

1.4.5 Gold as a secured loan

Department of commerce (PG) G.F.G.C Hosadurga Page 11

1.4.6 Factors affecting gold loan

 Quick Loan approvals and disbursals, with minimal documentation.

1.4.7 Risk to the borrowers and lenders

It is necessary to know the risk involved in borrowing Gold Loan as well as

Department of commerce (PG) G.F.G.C Hosadurga Page 12

Department of commerce (PG) G.F.G.C Hosadurga Page 13

1.4.8 Role of technology in rapid growth of gold loan

1.5 Structure of players in gold loan market

Borrowing against gold is one of the popular instruments based on physical

Department of commerce (PG) G.F.G.C Hosadurga Page 14

1.6 Indian scenario about the gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 15

1.7Global scenario about the gold loan

Department of commerce (PG) G.F.G.C Hosadurga Page 16

1.8 Future challenges of Gold loan

 Stiff competition from incumbents and the entry of Fintech players.

Department of commerce (PG) G.F.G.C Hosadurga Page 17

Design is the creation of a plan or convention for the construction of an object,

Department of commerce (PG) G.F.G.C Hosadurga Page 18

2.3 Review of literature

Nandakumar V P (2010): stated that the Organized Gold Loan segment is

Department of commerce (PG) G.F.G.C Hosadurga Page 19

Economics times dated (2012): George M G Muthoot chairman of India‟s

Department of commerce (PG) G.F.G.C Hosadurga Page 20

Sikka, Sundeep (2014): Sitka Sundeep, Chief Executive Reliance Capital

Department of commerce (PG) G.F.G.C Hosadurga Page 21

Ram Singapore (2014): Ram Singapore, general manager, Central Bank of

By jasvindarjit kauri (2016): India is known to be the largest importer of gold

V P Nandakumar (2016): VP Nandakumar CEO Mannapuram General