Name: chetan bangera Roll No: 120 Div: B MMS- 1 Specialisation :- Finance Name of Company :- Bank of India Title

:- To study the implementation of Retail Banking credit policy by Bank of India at branch level with special reference to Borivali west branch.
Introduction of Bank:Bank of India was founded on 7th September 1906 by a group of eminent businessmen from Mumbai. The Bank was under private ownership and control till July 1969 when it was nationalised along with 13 other banks. Beginning with one office in Mumbai, with a paid up capital of Rs. 50Lakhs and 50 employees, the Bank has made a rapid growth over the years and blossomed into a mighty institution with a strong national presence and sizeable international operations. In business volume, the Bank occupies a premier position among the nationalised banks. The Bank has more than 3200 branches in India including 93 Specialised branches. All these branches are controlled by 48 Zonal offices. There are 24 branches abroad. The bank came out with a public issue in 1997. Business has been conducted with the successful blend of traditional values and ethics and the most modern infrastructure. The Bank has been the first among the nationalised banks to establish a fully computerised branch and ATM facility at Mahalaxmi branch at Mumbai way back in 1989. The bank is also a founder member of SWIFT in India. It pioneered the introduction of the code system in 1982, for Rating the credit port-folio. The Banks association with the capitalmarket goes back to 1921 when it entered into an agreement with the Bombay Stock Exchange (BSE) to manage the BSE clearing house. It is an association that has blossomed into a joint venture with BSE, called as the BOI shareholding Ltd, to extend the depository services to the stock broking community. Bank of India was the first Indian Bank to open branch outside the country, at London in 1946 and also the first to open a branch in Europe, Paris in 1974. The Bank has sizeable presence abroad, with a network of 24 branches at key banking and financial centers like London, New York, Paris, Tokyo, Hong Kong and Singapore. The international business accounts for around 20.10% of the Banks total Business.

The Banks corporate personality and philosophy are fully reflected in the emblem, which is a five-pronged star. The elongated prong pointed upwards convey the Banks drive to achieve ascending goals. The star is a beacon and guide to those need direction. The Bank has a strong position in financing foreign trade. Over 270 branches provide export credit. The expertise in this area has enabled the bank to achieve a leading position in providing export credit in certain areas like diamond export. The Bank has identified target groups to develop core advantage for growth. The Bank has specialised corporate branches to undertake very large credit business overseas branches specializing in Foreign Exchange Business, NRI branches that specially caters to the requirements of Indians staying abroad, capital market branches which undertake all activities relating to capital market such as collection of applications, processing of refund orders, merchant banking etc. Commercial and Personal Banking branches cater to the requirements of the high worth customers. Apart from this, the bank also has specialized branches for Asset-recovery, Small scale industries, High-tech Agriculture finance, Lease finance and Treasury. To effectively meet the ever growing challenges and competition, the bank has made a good headway in bringing technological upgradation. MIS and Critical functions of controlling offices have been computerised. At present the operation at about 2618 branches are totally computerised. 26 branches operate in partially computerised mode whereas 1019 and 31 extention counters are migrated to the core Banking solution. New facilities such as telebanking, ATM and signature retrieval systems have been introduced in a progressing manner to add value to the services.

Introduction to Retail Banking:

This type of lending is meant for very small entrepreneurs as well as individuals who are engaged in profitable commercial activity and have the capacity to repay the loan. Loans are given on the strength of means of the borrower with an eye on the repaying capacity.The latter is judged on the basis of income of the borrower for repayment of the loan. Most of the banks now a days provide finance for the purchase of automobiles and other consumer durable items.The amount of loan to be given is decided on the basis of repayment capacity of the borrower,which in turn depends on the monthly income.Most of the banks have their own method to calculate the maximum monthly repayment capacity of a person. Therefore,a loan for which Equated Monthly Installment (EMI) is within this capacity is considered the outer limit for a person. The bank will be glad to finance to this extent for the purchase of an automobile or any other consumer durable item.Most of the banks judge the monthly income with reference to either the latest salary slip of the employer (in case of employees) or last years income tax return .In case of self employed persons other methods are also employed to appraise the maximum limit considered desirable for a person.

Need of the study:1. Retail Banking is growing and variety of products are on offer by banks in such a scenario it may be confusing for the borrowers to choose a right kind of product. So therefore there is a urgent need to conduct study on Retail Banking System. 2. Practices follows differ from banks to banks. This makes it necessary to conduct a study on general practices adopted by Bank of India in order to carry their retail banking business.

Features of various types of Loans: 1. Home Loan:

To purchase/construct house/flat/renovate/extend/repair existing house/flat. Maximum loan amount is Rs.3 crores and repayment ranges upto 20years, with reasonable processing charges. No commitment/ administrative charges. The home loan interest rates are attractive according to available in Industry. Option for different EMI amounts for different periods during tenure of loan to suit customers repayment capacity. Prepayment of loan permitted. Interest is calculated on daily balance basis which is of great advantage to customer as it results in lower interest amount.

2.Personal Loan:
Star personal loan scheme provides loan to meet various personal requirements of customers and their family. Bank offers loans for marriage expenses,medical expenses,educational expenses, purchase of consumer durables etc. Maximum quantum of advance is Rs.10 Lakh ,depending upon the income. Attractive interest rate. Easy repayment plan of 36 Equated monthly instalments w.e.f one month after first disbursement. Exceptional cases upto 60 months.

3.Education Loan:
The scheme envisages loans upto Rs. 12 Lakh for studies in India and upto Rs. 20 Lakh for studies abroad. For loans upto Rs.4 Lakhs no margin is required and from 4 Lakhs to 7.5 Lakhs 5% and above 7.5 Lakhs 15 % is charged. The loans are to be repaid over a period of 5 to 7 years with provision of grace period of one year after completion of studies. Based on the loan amount proposed,the interest charged is generally in the range of 10 % to 12 %. Special concession on the rate is provided, if the applicant is female candidate.

4.Auto fin Loan :

Bank gives loans to salaried employees, professional and self employed. The amount is given on Demand loan/Term loan and for 2 nd hand vehicles only demand loan. The loan is given upto Rs.25Lakhs for Indian vehicles and Rs. 75Lakhs for imported vehicles. Margin is charged upto 5 % on Rs. 2Lakhs , 10 % on Rs. 2Lakhs to 10Lakhs ,15 % on Rs. 10 to 25 Lakhs and 25 % on above Rs.25. Repayment time period is 60 months.

5. Mortgage Loan:
The scheme is utilized to meet the needs for commercial, trade and other business activities. It gives advance such as Demand/Term loan/Overdraft (reducible as per the repayment schedule). It target customer such as people engaged in trade, commerce and business, self employed, partnership firms etc. The quantum of advance is Rs.2lakhs for agriculturist Rs.50lakhs for individuals and Rs.1crore for partnership and company. Margin 30% for salaried employees and 50% for others. Repayment is upto 3 yrs. From the above features bank gets more profits in home loans in borivali area.

Process for granting the loans

Inquiry by the proponent regarding paper requirement, eligibility criteria, charges, rate of interest, margin required, principal and collateral security required, TAT (Turnaround Time) etc and guarantor required. Submission of papers. Scrutiny of papers. Rating sheet. CIBIL and other findings. Preparation of proposal and sanction there off. Pre-sanction inspection. CPA-1 and CPA-2 if applicable. Documentation and vetting. Disbursement. Post sanction, Inspection and other terms.

Regular follow up and accounts closed.

Background of the study:

Loans and Advances (Credit) department banking business generally involves accepting the deposits from the public and investing or lending the same to those people who need funds, at a certain rate of interest and there by earning profit. However, lending money involves certain risk factors and therefore banks provide loans to the farmers, traders, businessmen, industrialist and others against either tangible or intangible security. Even though, the banks still run the risk of default in repayment. As a result, the banks follow cautious measures while lending money to others. This core function is performed by the credit department of the bank. In this way, the relationship of the bank and customer is that of the creditor and debtor. This study has been conducted to understand the role played by the banks in the business world by way of loans and advances and also understand the bank credit policy in its lending activity.

Objectives of the study:

To study the overall functioning of the loans and advances department of the Bank of India. To understand the role played by the Bank of India in extending credit facilities to various types of borrowers. To understand the banks credit policy and its implementation there off at the branch level, specifically Borivali (West) Branch.