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Introduction to Banking in India:Finance is the life blood of trade, commerce and industry. Now-a-days, bank money acts as the back bone of modern business. Development of any country mainly depends upon the banking system. The term bank is derived from the French word Banco which means abench or money exchange table. In olden days, European money lenders or money changers used to display coins of different countries in big heaps on benches or tables for the purpose of lending or exchanging. A bank is a financial institution which deals with the deposits and advances and other related services. It receives money from those who want to save in the form of deposits and lends money to those who need it. In this modern world, bank has improved a lot in each and every aspects and services given by bank to their customers. Bank performs variety of functions such as primary functions and secondary functions. Under primary functions there are certain functions such as accepting deposits and granting loans to the needed persons. Bank accepts deposits in various forms like as saving deposit, current deposit, fixed deposit, recurring deposit. Bank grants advance in various ways viz overdraft, cash credit, loans, discounting bills. Bank performs secondary functions such as agency functions and utility functions. Now, under agency functions there are services like transfer of funds, portfolio management, collection of cheques. Utility functions viz drafts, lockers, underwriting projects, etc.Now-a-days bank is developing in the field of insurance also. Bank deals with big project. Bank provides loans on short term basis as well as long term basis. There are number of banks in India. The different banks like as Saraswat bank, Nav-Jeevan bank, Axis bank, Punjab national bank, Canada bank, HDFC bank, Union bank, State bank of India, and many more. The Reserve bank of India is bankers bank. The various differences in all the banks and RBI are - it prints notes, it does not deal with people; it deals with banks. It frames rules, regulations and policies for all the banks. All banks work under RBI.The nationalized banks initially concentrated on large cultivators and small farmers who were engaged in raising high yielding varieties of food grains. The government has extended the integrated rural development programmers to all development blocks in the country and has asked the commercial banks to finance the IRDP.
Definitions of bank:Oxford dictionary defines a bank as, An establishment for custody of money which it pays out on customers order. The Indian banking act 1949 defines banking company as, A company which transacts like business of banking has in India & the word banking has been defined as accepting for the purpose of lending or investments of the deposits of money from the public, repayable on demand or otherwise & withdraw able by cheque, draft, order or otherwise.
Some common characteristics of banks:In this modern world, there must be certain features of bank. Following are the characteristics of bank: Dealing in bank Individual firm or company Acceptance of deposits Giving advances Payment & withdrawal Agency & Utility services Profit and service orientation Ever increasing functions Connecting link Banking business Name identity Development role
Functions of bank are:Bank performs certain functions such as primary functions and secondary functions.bank gives us various facilities such as accepting deposits, granting loans, drafts, locker facilities, underwriting projects, discounting of bills of exchange cash credit, periodic payments, periodic collections, etc.
Short view of the bank:Type Industry Founded Headquarters Products Public company Banking financial services 1918 Mumbai, India Investment banking Commercial banking Retail banking Private banking Asset management Mortgages Credit cards Rs. 27,313 crore (2010-11) Rs. 358.19 crore (2010-11) 3338
Saraswat Bank:an urban co-operative banking institution based in Maharashtra, India and operating as a co-operative bank since 1918. In 1988, it was conferred with scheduled status by the Reserve Bank of India.
Saraswat bank is
The bank has observed good growth during the 2000s with its total business growing from 40 billion rupees in 2000 to 230 billion rupees in 2010 (approx. 5 billion US$). The bank has been granted a pan-India operation license by the Reserve Bank. Popular Articles About Saraswat Bank Saraswat Bank to acquire three cooperative banks. June 13, 2008 MUMBAI: Saraswat Bank said it will acquire three cooperative banks in this financial year taking the total number of its acquisitions to eight. The three banks are The South Indian Cooperative Bank, Amaravati Cooperative Bank and Sirushi Cooperative Bank in Karnataka, Saraswat Bank Director Ekanath K Thakur told reporters. "We hope to complete the acquisition of The South Indian Cooperative Bank by August. The Reserve Bank has been informed about it," Saraswat Bank Articles By Date How Raghunandan Kamath made Natural Ice Cream a 50 crore business January 9, 2012 | Amit Shanbaug , ET Bureau We were probably the first to mass produce natural ice cream in the traditional way. We also took the lead in experimenting with unconventional flavours like cucumber and turmeric. We were possibly the first to have an international celebrity like cricketer Vivian Richards to endorse the brand on television without being paid for it. That's a lot of firsts for the son of a fruit vendor from Mangalore . It just goes to show how passion and perseverance pay.
Following schemes and interests which bank provides:Saraswat Bank ups interest on savings accounts to 6.14%
The country's largest urban cooperative Saraswat Bank today announced that it would offer 6% interest on savings deposits which will be payable every quarter and thus effectively paying 6.14% interest on an annual basis.
The country's largest urban cooperative Saraswat Bank today announced that it would offer 6% interest on savings deposits which will be payable every quarter and thus effectively paying 6.14% interest on an annual basis "We have decided to offer 6% interest on savings deposits, effective December 1. In fact, since we will be making the payout every quarter, the effective rate will be 6.14% on an annual basis," bank chairman Ekanath Thakur told reporters here. Giving the rationale for effecting the change, Thakur said, "We feel that in today's banking, the depositor is short-changed. And we, being the largest in the segment, wanted to change that and reward our depositors and also set the tone for the rest." It was on October 25, the Reserve Bank had deregulated the yield on savings accounts and let the banks to set the pricing. However, so far only three mainstream banks, that too mid-size ones Yes Bank, Kotak Bank and IndusInd Bank-- have followed suit. Thakur said, on the day (November 25) the Reserve Bank issued the guidelines deregulating savings bank deposit rates, their asset liability committee met and decided to reprice the SB assets. On the impact of this on his margins, the chairman said it will be about 40-45 basis points. The bank's current net interest margin, which is a key measure of a bank's profitability, stands at 3.78%, he added. But Thakur sounded confident about absorbing the higher outgo by better cost rationalisation and other overhead expenses. On expansion plan, Thakur said, the bank will have 300 branches by the end of this fiscal and 500 by 2014. Currently, the bank, set up in 1918, has 223 branches and 141 ATMs. Thakur said the bank has CASA of 28% with savings deposit accounting for 22% of its deposits while current deposits are 6%.
The overall asset of the bank stood at Rs 29,500 crore as of the September quarter out of which deposit stood at Rs 17,000 crore and the rest were advances.
Saraswat Co-operative Bank offers various loans to its customers. Bank takes care of its customers by offering comprehensive loan packages at extremely competitive rates, without any hidden costs. Our personalised service coupled with state of the art technology at absolutely market competitive rates shall make your Banking experience a truly memorable one.
RTGS/NEFT Cash Pick Up Nomination of Deposits Death Claim Settlement Standing Instructions Lockers
Various deposit schemes :Saraswat Bank provides information of it's various Investment & Insurance products which customers can avail of with the bank.
I.
Savings Deposit
A Savings Account for everyone to inculcate the habit of saving and avoid thrift. Bank offers you a host of convenient features and banking channels to transact through. Personalized service coupled with technology enabled products is the hallmark of our service. We offer you a saving account with host of products like SMS Banking, Mobile Banking and allow you to operate your account in the confines of your home /office through internet . Bank offers you a VISA debit card. All the services are offered to you with very simple terms and conditions and minimal charges. The salient features of the saving account are given as under
Bank conveniently with facilities like Net Banking and mobile banking- Check your Account Balance. Take advantage of Easy Pay, an instant solution to all your frequent utility bill payments Never overspend. Shop using your international Visa Debit Card depending on the balance in your saving account Wide ATM coverage and get connected to ATM across the world through VISA Debit Card Free Personalized Cheque Book with name printed on each cheque leaf for enhanced
Avail of facilities like Safe Deposit Locker . Free Passbook facility available at home branch for account holders (individuals).
II.
Term Interest
Features
TDS applicable Form 15H/15G required to be submitted for exemption of TDS. Nominal member of the bank will also be exempted from TDS. If you are exempt from paying tax, you need to present Form 15H when you open a Fixed Deposit and subsequently at the begin
Penalty
In case of payment before maturity Interest upto 15 days will be Nil Above 15 days : 1% less than applicable rate of Interest for the actual period for which deposit is kept with the Bank.
III.
Current Deposit
Fasten your pace with a current account which offers you out of the world service experience by combining personalized service with many appropriately priced features. Our customer friendly staff will not leave any stone unturned to make your experience a memorable one. Internet Banking, SMS Banking all will allow you to Bank from the comfortable confines of your home and office. All our branches are on Core Banking which allows you free transfer of funds from one account to another at any branch. We also have a tie up with VISA and offer a VISA debit card.
Bank conveniently with facilities like free Net Banking and SMS Banking - Check your account balance. Never overspend. Shop using your international Visa Debit Card depending on the balance in your saving account. Wide ATM usage and get access to ATMs all over the world through our VISA tie-up. Avail of Safe Deposit Locker facilities(subject to availability) . 8
Free monthly statement. Avail Personalized chequebook for enhanced security at nominal prices . Take advantage of Easy Pay. An instant solution to all your frequent utility bill payments. Free Cash Deposit/withdrawal from any branch of Saraswat Bankup to Rs 25000. Free transfer to any account in any branch of Saraswat Bank through Any Branch Banking.
b. Import Finance
Bank is providing import finance to its valuable customers by providing letter of credit facility for its customers to purchase their raw materials . These are generally provided for 90 to 180 days . Our Bank provides term finance/term loans for business expansion, upgradation of existing facilities etc to ease the pressures on margins of the company.The Bank is providing structured term loans to meet your short term as well as long term funding requirements . We offer specific solution so as to match repayment with your cash flows to repay the debt thereby enhancing your profitability c. Export -Credit: If you are a eligible exporter Sarswat Bank offers you Pre Shipment Credit facilities and Post Shipment Credit Facilities d. Pre-Shipment-Credit-facilities: We offer Pre-shipment credit by way of Packing Credit enabling you to finance purchase/import of raw materials, processing and packing of the goods meant for exports
Post shipment Credit facilities Post shipment credit facility is offered to an exporter to
finance export sales receivables after the date of shipment of goods till the date of realization of export proceeds . We offer our client a choice of the following services :
1) 2) 3) 4) 5)
Negotiation /Payment /Acceptance of documents under letter of credit. Purchase/ discount of export document under letter of credit. Advance against export bills sent on collection basis. Advance against exports on consignment basis. Advance against undrawn balance on exports.
e. Bill Discounting
We are offering facility which are customized to suit your requirement for short term finance from the date of sale to date of receipt of payment thereof. Our processes are simple, allowing you to establish single window contact with competent dedicated personnel at any of our branches as per your convenience.
f. Bank Guarantees
Bank issues various types of guarantees - performance, financial, for its customers. Our guarantees are well accepted by all government agencies including Customs, Excise, Insurance Companies, Shipping Companies and all major corporates.
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Aspects of Banking and Insurance Security Equitable Mortgage of Residential, commercial or industrial property. Guarantor: Need not be obtained however in case of firms, companies, guarantee of partners, directors to be obtained. Share-Holding 2.5% of the loan amount, Maximum 2500 shares, Guarantors as nominal members. Documents-Required Others: 1)I.T.Returns. 2) For salaried employees income proof such as Form No.16 along with salary certificate from employer 3)Original Title Deeds of the property offered for mortgage. 4) Other documents as per Vastu Siddhi Loan Scheme
b) Rental Loans
Maximum amount or 65 % of the total net rent (i.e. rent after taxes such as property tax, TDS) to be received whichever is lower. Margin : 35 % Repayment Period: 5 years maximum or till the remaining period of the lease which is earlier. Security: Equitable mortgage of the property given on rent or any other acceptable property of value of 35% more than the loan amount, subject to valuation certificate from Banks approved valuer. Processing Fees. - .0.5 % of the loan amount. Guarantors : In case the borrower is a partnership firm or a limited company, personal guarantee of the partners/directors .
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Overview:
The rupee was unable to sustain gains during the fortnight and retreated to lows near 56 against the US currency as underlying risk appetite was still generally fragile. Underlying confidence in the fundamentals remained relatively weak with a higher than expected 7.55% inflation reading dampening expectations of a more aggressive Reserve Bank of India stance in cutting interest rates. There were also reports that the latest trade data was weaker than expected with an annual 4% decline in exports in the year to May. Standard & Poors also warned that India could lose its investment grade rating. Given increased doubts surrounding the domestic economy, the rupee will find it difficult to secure more than limited gains even if risk conditions improve
1.2431 1.2664 1.2384 1.2636 78.07 79.78 77.96 78.69 1.5369 1.5726 1.5320 1.5715
Overview:
The dollar drifted lower for the fortnight as a whole not helped by relatively weak data releases with losses curbed by an underlying lack of Euro-zone confidence. Risk conditions gradually stabilised which lessened defensive demand for the US currency. US jobless claims were slightly higher than expected at 386,000 in the latest week from a revised 380,000 previously which suggested little underlying improvement in the labour market. There was also a 0.3% decline in headline consumer prices for May, although there was a core 0.2% increase in prices.
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Aspects of Banking and Insurance Savings and Investment Plans: You have always given your family the very best. And there is no reason why theyshouldnt get the very best in the future too. As a judicious family man, your priority is to secure the wellbeing of those who depend on you. Not just for today, but also in the long term. More importantly, you have to ensure that your familys future expenses are taken care, even if something unfortunate were to happen to you. Our Savings & Investment Plans provide you the assurance of lump sum funds for you and your familys future expenses. While providing an excellent savings tool for your short term and long term financial goals, these plans also assure your family a certain sum by way of an insurance .
Health Plans:
Health plans give you the financial security to meet health related contingencies. Due to changing lifestyles, health issues have acquired completely new dimensions becoming more complex in nature. It becomes imperative then to have a health plan in place, which will ensure that no matter how critical your illness is, it does not impact your financial independence.
Easy pay: Here is one more exciting facility the Bank has offered to relieve its customers, our esteemed client, from spending your valuable time standing in a queue for routine utility bill payments. All you have to do is to walk into any of our branch and register yourself under : Easy Pay scheme for all your recurring utility bill payments such as Telephone, Electricity Bills, Cellular Phone Bills, Insurance Premium & many more. Once you are registered all your future bills will be paid automatically through the bank account with us.
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MACRO ANALYSIS
1) Internet banking :
Internet banking: Also referred to as E-banking, internet banking is changing the banking industry and is having the major effects on banking relationships. Almost every bank has a website today and provides for delivery of its products & services electronically. In true Internet banking, any inquiry or transaction is processed online without any reference to the branch at any time. Providing Internet banking is increasingly becoming a "need to have" than a "nice to have" service, and it is soon to become a norm from an exception due to the fact that it is the cheapest way of providing banking services. Using e-banking a customer can view account balances & statements, transfer funds between accounts, create FDs Online, request a DD, pay bills, order a cheque book,request stop payment on a cheque, apply for and access credit cards, apply for loans and most importantly gets easy access to complete information about various products and offers.
2) Phone Banking :
It use an automated phone answering system with phone keypad response or voice recognition capability. This feature is known as Interactive Voice Response System (IVR). With the obvious exception of cash withdrawals and deposits, it offers virtually all the features of an automated 15
Aspects of Banking and Insurance teller machine: account balance information and list of latest transactions, electronic bill payments, funds transfers between a customer's accounts, etc. Some banks engage call centers to provide 24*7 services to their customers, via toll-free numbers. Others connect their customers to phone bankers, but in this case, the service is only available for particular hours for which phone bankers are available. Some make use of both i.e. toll-free numbers for some services, and phone bankers for the ones that require professional assistance. Telephone banking representatives are usually trained to do what was traditionally available only at the branch: loan applications, investment purchases and redemptions, cheque book orders, debit card replacements, change of address, etc. 3) Mobile Banking : ICICI was the first bank in India to introduce complete mobile banking services in the year 2007. Since then, conducting banking operations using the mobile phone has been fast catching up in the country. It works through a set of text messages (SMS). With SMS a customer can perform a wide range of query-based transactions from his/her mobile phone, like funds transfer (within and outside the bank),enquiry services (Balance enquiry/ Mini statement), request services (cheque book request), bill payment (utility bills, credit cards Saraswat Bank has introduced Mobile Banking. Customers can now initiate the following transactions at their end by using SMS banking long code 9223810000" a)Account balance enquiry Type SMS like SBAL & send it to 9223810000. Sample SBAL SBPUB 10 b)Last three transactions Type SMS like LST3 & send it to 9223810000. Sample LST3 SBPUB 10
MICRO-ANALYSIS
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COMPANYHISTORY:
"The Saraswat Co-operative Banking Society" was founded on 14th September 1918. Mr.J.K. Parulkar became its first Chairman, Mr. N.B. Thakur, the first Vice-Chairman, Mr.P.N. Warded, the first Secretary and Mr. Shiva Gopal Rajadhyaksha, the first Treasurer.These were the people with deep and abiding ideals, faith, vision, optimism andentrepreneurial skills.The Society was initially set up to help families in distress. Its primary objective was to provide temporary accommodation to its members in eventualities such as weddings of dependent members of the family, repayment of debt and expenses of medical treatmentetc. The Society was converted into a full-fledged Urban Co-operative Bank in the year 1933. The Bank, which was originally founded in 1918. Russian Revolution, also witnessed as a Society and as Bank-the First World War, the Second World War, India's freedom Movement and the glorious chapter of post-independence India. It got a permanent license to deal in foreign exchange in 1978. Presently the Bank is having correspondent relationship in 45 countries. The Beginning of the 21st Century has been giant leap forward for the Bank. Bank chose a path of organic/inorganic growth and pace of growth accelerated .Bank's total business which was around Rs 4000 Core in 2000which almost tripled to Rs 15295 Core in 2007. The Business of the Bank as on 31stMarch 2009 had crossed Rs 21000 Crores.
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ATM facilities
To add to your convenience , your Bank has tied up with VISA for issuing Debit Card. VISA has a long-standing name in the banking industry in India as well as abroad. Visa is a reliable, 19
Aspects of Banking and Insurance international brand. Debit Card is basically a convenience card which can be used at a POS for making purchases at Merchant Establishments. This card can also be used as an ATM card for withdrawing cash at all the ATMs bearing VISA logo in India and aboard. Debit Cards
This card can be used as an ATM card for withdrawing cash at the following ATMs: Debit card can be used at Domestic as well as International ATMs, POS machines bearing the Visa logo at merchant establishment and for Purchases/Ticket Booking through Internet that use a secured e-Commerce Payment Gateway. Debit card can be used up to the balance available in the account of cardholder. The maximum amount for transaction (Point of Sale + Online + ATM) is maintained at Rs 25000/- per day. Benefits a. Facilitates electronic transactions and saves the customer from carrying cash b. Provides access to merchant establishments, eCommerce transactions and ATM access. c. Extensive usage across a number of establishments as VISA is widely recognized in all leading departmental stores, ecommerce sites and retail outlets all over the world. Registration The form for Registration can be downloaded from the "forms" section in the website or visit nearest branch
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Aspects of Banking and Insurance Charges : CHARGES HEAD CHARGE Annual Fee Rs 99/- p.a. plus taxes Additional Card Rs 99/- per card plus taxes. Replacement Of a Damaged NO CHARGE Debit Card Replacement Of A Lost Debit Rs 99/- per card plus taxes. Card Pin Replacement Rs 25/SARASWAT BANK ATMs FREE Cash Withdrawal / Balance Enquiry Other banks ATM for Savings Free for the first five* transactions in a calendar month. From 6th transaction onwards cash withdrawal will be A/c a)Cash Withdrawal/Balance charged at Rs 20/- per transaction(inclusive of service tax) & balance enquiry will be charged at Rs 10/- per Enquiry transaction(inclusive of service tax) *Includes both financial (cash withdrawal) & nonfinancial (balance enquiry) transactions. Other banks ATM for Current Charges of Rs 20/-(inclusive of tax) per cash withdrawal every transaction. A/c holders and Overdraft A/c for Free. holders a) Cash Withdrawal b) Balance Enquiry ATM Cash Withdrawal Rs 120/- per transaction. (Outside India) ATM Balance Enquiry Rs 15/- per enquiry. (Outside India) Sales Slip Retrieval / Charge Rs 225/Back Processing Fee Combined per day limit for Rs 25,000/ATM Cash Withdrawal / POS Transaction / Online Transaction For usage at Merchant No charges Establishments (POS) For Internet Payments No charges For usage at Petrol Pumps Surcharge @ 2.50% of transaction amount or Rs 10/(whichever is higher) For usage at Railway Stations or Surcharge @ 2.50% of transaction amount or Rs 10/booking train tickets through (whichever is higher) Internet
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CONCLUSION
The market is seeing Discontinuous growth driven by new products and services that include opportunities in credit cards, consumer finance and wealth management on the retail side, and in fee-based income and investment banking on the wholesale banking side. Given the demographic shifts resulting from changes in age profile and household income, consumers will increasingly demand enhanced institutional capabilities and service levels from banks. With the growth in the Indian economy expected to be strong for quite some time-especially in its services sector-the demand for banking services, especially retail banking, mortgages and investment services are expected to be on rise. Reserve Bank of India (RBI) has approved a proposal from the government to amend the Banking Regulation Act to permit banks to trade in commodities and commodity derivatives
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