N I R AV A J M E R A

(BBA,PGDBM,PURS. EXEC. MBA – IIM A)

9 YEARS – BANKING & FINANCE
 COVERAGE

1. INDIAN BANKING INDUSTRY & STRUCTURE

2. RETAIL BANKING PRODUCTS

3. NON-RETAIL PRODUCTS

4. TRADE FINANCE AND FOREX PRODUCTS

5. MILLENNIAL / DIGITAL BANKING /FINTECH

6. ROLE OF BANK IN ECONOMY & INFRASTRUCTURE GROWTH

7. BANKING STRUCTURE & OPPORTUNITIES FOR MANAGERIAL TALENT

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 1. INDIAN BANKING INDUSTRY & STRUCTURE

Reserve Bank of India (RBI)

Scheduled Non Scheduled

Banks Banks

Co-operative Regional Rural

Commercial Banks Payment Banks
Banks Banks

Public Sector
Private Sector Foreign Banks
Banks (SBI,
Banks (HDFC, (StanChart, Citi,
BOB, Dena,
ICICI, Axis, YES) Deutsche)
PNB)

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RESERVE BANK OF INDIA – RBI IS THE CENTRAL BANK OF INDIA WAS ESTABLISHED IN
ACCORDANCE WITH THE PROVISIONS OF THE RESERVE BANK OF INDIA ACT, 1934.
REGULATORY AUTHORITY; CURRENCY REGULATOR, MONETARY POLICY MAKER AND
“BANKER OF BANKS” AND BANKER FOR GOVERNMENT N INDIA. PRESENT GOVERNOR OF
RBI SHRI SHAKTIKANTA DAS.

SCHEDULED BANKS AND NON-SCHEDULED BANKS– A SCHEDULED BANK IS ONE THAT IS

LISTED IN THE SECOND SCHEDULE OF RBI ACT, 1934. BANKS POST COMPLYING VARIOUS
RULES; REGULATIONS AND STIPULATIONS ARE ELIGIBLE FOR INCLUSION IN THE SECOND
SCHEDULE. RBI DOES NOT GRANT LICENSES EASILY AND LAST UNIVERSAL LICENSES
WERE GIVEN TO IDFC AND BANDHAN BANK IN 2014. .

NON- SCHEDULED BANKS ARE THOSE WHICH ARE NOT INCLUDED IN THE SECOND
SCHEDULE OF THE RBI ACT, 1934. DO NOT HAVE TO MAINTAIN CRR WITH THE RBI. IT
CANNOT LEND MONEY.

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COMMERCIAL BANKS – COMMERCIAL BANKS ARE JOINT STOCK COMPANIES,
INCORPORATED AS A BANKING COMPANY. COOPERATIVE BANKS ARE COOPERATIVE
ORGANIZATIONS AND WORK FOR SERVICE MOTIVE. BASED ON THEIR SHAREHOLDING
THEY ARE FURTHER CLASSIFIED AS PUBLIC, PRIVATE AND FOREIGN BANKS. .

PUBLIC SECTOR BANKS– THESE ARE BANKS WHERE MAJORITY STAKE IS HELD BY THE
GOVERNMENT OF INDIA. THEY ARE ALSO KNOWN AS PSU BANKS.

PRIVATE SECTOR BANKS– THESE ARE BANKS MAJORITY OF SHARE CAPITAL OF THE BANK
IS HELD BY PRIVATE PLAYERS. .

FOREIGN BANKS– THESE BANKS ARE REGISTERED AND HAVE THEIR HEADQUARTERS IN A
FOREIGN COUNTRY BUT OPERATE THROUGH THEIR BRANCHES IN INDIA.

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PAYMENTS BANKS - A PAYMENTS BANK AIMS TO FURTHER FINANCIAL INCLUSION,
ESPECIALLY THROUGH SAVINGS ACCOUNTS & PAYMENTS SERVICES. ACCORDINGLY, NOT
ALLOWED TO GIVE ANY FORM OF LOAN. CUSTOMERS CAN OPEN A SAVINGS ACCOUNT WITH
DEPOSITS OF ONLY UP TO ₹ 1 LAKH, WHICH IS ALSO THE MAXIMUM BALANCE ALLOWED. AS
PER RBI GUIDELINES, PAYMENTS BANKS CAN’T ACCEPT FIXED OR RECURRING DEPOSITS.

REGIONAL RURAL BANKS– FORMED UNDER REGIONAL RURAL BANK ORDINANCE 1975.
RRB’S WERE SET UP WITH A VIEW TO DEVELOPING THE RURAL ECONOMY BY PROVIDING
CREDIT FOR THE PURPOSE OF DEVELOPMENT OF AGRICULTURE, TRADE, COMMERCE,
INDUSTRY AND OTHER FACILITIES, PARTICULARLY TO THE SMALL AND MARGINAL FARMERS,
AGRICULTURAL LABOURERS, ARTISANS AND SMALL ENTREPRENEURS. VIZ. SAURASHTRA
GRAMIN BANK, DENA GUJARAT GRAMIN BANK.

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CRITICAL ROLE OF RBI

RBI PLAYS A VITAL ROLE IN MANAGING THE MONEY SUPPLY IN THE ECONOMY & IN MANAGING
POLICY RATES WHICH HAS A IMPACT ON BANKING OPERATIONS.

SLR – STATUTORY LIQUIDITY RATIO – SECURITY IN FORM OF GOVT BONDS, GOLD ETC – 19.25%

CRR – CASH RESERVE RATIO – CASH RESERVE – 4%

REPO RATE – RATE AT WHICH RBI LENDS TO THE BANKS

REVERSE REPO – RATE GIVEN BY RBI FOR BORROWING FROM BANKS.

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HIGH POWERED MONEY AND MONEY SUPPLY – CHANGE IN SLR/CRR

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IMPACT OF POLICY RATES ON BANKING SYSTEM

- BANKS HAVE TO KEEP CRR & SLR WITH RBI, WHEN THEY FALL SHORT OF RATIO,
THEY BORROW FROM RBI OR ANY OTHER BANKS

- IF RBI INCREASES REPO & REVERSE REPO, THEN THEIR COST OF FUND WOULD
INCREASE AS THEY HAVE TO BORROW AT HIGHER RATE FROM RBI FOR
MAINTAINING THE STATUTORY REQUIREMENT

- MOREOVER, DUE TO REVERSE REPO BEING HIGHER, IT BECOMES RISK FREE TO

KEEP THE FUNDS WITH RBI RATHER THEN LENDING IN THE MARKET.

- DUE TO BOTH IMPACT MARKET RATES WOULD SURGE. THIS SITUATION WOULD
REVERSE IF POLICY RATES ARE BEING REDUCED.

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 2. RETAIL BANKING PRODUCTS
RETAIL LIABILITIES RETAIL ASSETS

Current Account
•Large number of transactions.
Auto Loans Home Loans
•Only option for corporates and businesses
•No Interest bearing

Savings Account Loan against

•Limited transactions
Gold Loan properties or
•Suitable for individuals, trusts, associations. shares
•Low Interest Bearing

Term Deposits Personal

•Fixed Deposits Loans &
•Recurrent Deposits Credit Cards
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 3. NON RETAIL BANKING PRODUCTS

• Working Capital means Stock + Receivables – Creditors).

• Maximum Permissible Banking Finance (MPBF) is maximum finance
that can be given to corporates. Various popular methods are turnover
method and Tandon Committee (second method). Basic concept is 25%
contribution from corporate.
• Cash Credit (CC) has monthly tracking of these figures and limit set up
Working which is called drawing power.
Capital
Loans - Cash Stock Debtors < Creditors Working Capital Drawing Power
Credit / 90 days Requirement (75% of WC)
Overdrafts 3000 2000 1000 4000 3000
• Overdraft (OD) given for special purposes and same limit every month
irrespective of working capital. Given for Schools, Colleges, Hotels &
Restaurants, etc.
• Ad-hoc Limits / Temporary Overdraft are temporary loans provided by
banks

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 3. NON RETAIL BANKING PRODUCTS

• Given for Long Term Purposes only.

• Common Accounting Fundamental to Fund Long Term Uses through Long
Term Resources. New Asset / Building / Plant & machinery or any asset
Term Loans having long usable life shall be funded through term loan only.
• Biggest mistake companies make is using working capital limits for long
term uses which adversely affects balance sheet and liquidity (current
ratio) which leads to bankruptcy in many cases.

• Cash Management Systems (detailed discussion on later slide)

• Salary Accounts
Other • Escrow Accounts
Products • Buyback / IPO Accounts
• Insurance Business
• Channel Finance Limits

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 4. TRADE FINANCE AND FOREX PRODUCTS
• Export Credit – Money to
• Letter of Credit
export goods
• Letter of Undertaking /
• Pre & Post Shipment
Buyer’s Credit / Suppliers
Credit
Credit
• EPC / PCFC/ PSC /
• Factoring
PSCFC/ FBD
Exports Imports • Advance remittances
• Govt. Subvention as
exchange earner

Guarantees
Foreign
• Performance Bank Exchange • Remittances inward &
Guarantees Outward
• Financial Bank Guarantees • Currency Exchange
• Standby Letter of Credit • Forward Contracts
• RBI & FEMA compliances

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 •

IN INDIAN RUPEES SAME IS CALLED EXPORT PACKING CREDIT (EPC) AND IN FOREIGN
CURRENCY ITS CALLED EXPORT PACKING CREDIT IN FOREIGN CURRENCY (PCFC) AND
SIMILARLY FOR POST SHIPMENT .
EXPORT BILLS CAN BE DISCOUNTED WHICH IS CALLED FBD OR FBN
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 LETTER OF CREDIT
LETTER OF CREDIT IS THE
WRITTEN INSTRUMENT ISSUED
BY THE IMPORTER’S (BUYER’S)
BANK TO THE EXPORTERS
(SELLER). L/C IS THE
GUARANTEE GIVEN BY BUYER’S
BANKS TO REMIT THE AMOUNT
TO THE SELLER ACCORDING TO
THE TERMS AND CONDITIONS
BASED ON THE CONTRACTUAL
AGREEMENT BETWEEN BUYER
AND SELLER. L/C IS THE MOST
RELIABLE AND ACCEPTABLE
METHOD OF OBTAINING THE
PAYMENT FOR EXPORTER.

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NON FUND BASED PRODUCTS

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5. MILLENNIAL / DIGITAL BANKING / FINTECH

The Thumb Cycle

?
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 National Payments Corporation of India (NPCI), an umbrella organization for operating
retail payments and settlement systems in India, is an initiative of Reserve Bank of India (RBI)
and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement
Systems Act, 2007, for creating a robust Payment & Settlement Infrastructure in India.
 RTGS: Real Time Gross Settlement (RTGS) can be defined as the continuous or real-time
settlement for large value transactions (> 2 Lacs only). There is no upper limit for RTGS
transactions. Transfer of funds is immediate during business hours. (Usually few minutes, but
not necessarily in seconds).
 NEFT: National Electronic Funds Transfer (NEFT) is a method of payment on a Deferred Net
Settlement (DNS) basis which settles transactions in batches. There is no limit for using this
service. The Transfer is not immediate it can happen in 48 hours.
 Immediate Payment Service (IMPS): IMPS provides a service for transferring money, immediately
from one account to the other account, within accounts across different banks. This facility can
be used through mobile banking applications for 24X7, and also through internet banking.IMPS
can be availed 24*7 and on all public holidays and bank holidays including RBI holidays.

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M O B I L E WA L L E T : I S A W AY TO C A R R Y C A S H I N D I G I TA L F O R M AT. YO U
C A N L I N K YO U R C R E D I T C A R D O R D E B I T C A R D I N F O R M AT I O N I N
M O B I L E D E V I C E T O M O B I L E W A L L E T A P P L I C AT I O N O R YO U C A N
T R A N S F E R M O N E Y O N L I N E TO M O B I L E WA L L E T. I N ST E A D O F U S I N G
YO U R P H Y S I C A L P L A ST I C C A R D TO M A K E P U R C H A S E S , YO U C A N PAY
W I T H YO U R S M A R T P H O N E , TA B L E T, O R S M A R T W AT C H .

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 UPI: Unified Payments Interface (UPI) is a system that enables multiple bank accounts, many
banking services feature like fund transfer (P2P), and merchant payments through a single
mobile application. Instant fund transfer 24*7 through mobile apps. one can use any service to
send money to anyone in India within seconds. It does not require bank account number or IFSC
code of the payee through Virtual Payment Address (VPA), which will serve as your address to
send and receive money. Eg. BHIM, PhonePe etc.
 Bharat QR is P2M (Person to Merchant) Mobile payment solution.
This solution is mutually derived among NPCI, Visa and Mastercard payment networks. Bharat
QR transactions are different from POS transactions. In POS transaction, POS terminal is
required whereas in Bharat QR transaction, QR Code is required. Using mobile banking app or
wallet user will scan the QR Code placed in merchant outlet and make the payment using the
RuPay Card linked to the BQR.

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F O O D F O R T H O U G H T: A S O F M A R C H 31 , 2 01 8 , T H E N U M B E R O F
“A L I PAY ” U S E R S R E AC H E D 87 0 M I L L I O N . I T I S T H E S E C O N D L A R G E S T
M O B I L E PAY M E N T S E R V I C E O R G A N I Z AT I O N I N T H E W O R L D .

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FINTECH
FinTech is the combination of technology in finance. “Necessity is the mother of invention”. Yes,
and today’s necessity is the digitization of financial transactions. It is paradoxical that in spite of
one of the fastest growing economies of the world; still, our country has 190 million unbanked
adults. (Source: Business Standard)

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6. ROLE OF BANK IN ECONOMY & INFRASTRUCTURE GROWTH

- Project funding

- HAM project funding for public private partnership

- Multiplying the money supply in the economy

- Boosting demand side economy by providing credit card & other short term funding facilities

- Globalizing the transactions - supporting import & export

- Supporting in FX transaction

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7. BANKING STRUCTURE & OPPORTUNITIES FOR MANAGERIAL TALENT
WITHIN BANKING (ENTRY LEVEL)

Flair: Marketing / Flair: Operations / Flair: Risk &

Customer Centric Back Office Work Product
•Retail Banking – •Branch •Credit
Branch Operations Assessment
Relationship •Documentation •Credit assistant
Managers •Cash •Risk manager
•Relationship Management
Managers– •Transaction
Corporates/ Authorization
Govt.
•Internal Audit
Organizations

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 CORPORATES (ENTRY LEVEL)

Flair: Finance Flair: Creativity / Flair:

Team Fintech Consultancy
• Understanding • Various • Financial
Working Capital opportunities in Consultancy
Requirements start-ups/ • Investment
of Corporate Fintech Banking
and liasoning + Companies • Loan Agency
discussion with looking for Business
Bankers and fresh
• Special
structuring of managerial
Transaction
products talent
Advisory
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26
GRADE & ITS IMPORTANCE

- O F F RO L E – O N T H E O U T S O U RC E PAY RO L L
- CONTRACTUAL ROLE WITH COMPANY
- EXECUTIVE
- A S S I STA N T M A N AG E R
- DEPUT Y MANAGER
- MANAGER
- SENIOR MANAGER
- CHIEF MANAGER
- A S S O C I AT E V I C E P R E S I D E N T
- VICE PRESIDENT
- SENIOR VICE PRESIDENT
- EXECUTIVE VICE PRESIDENT
- GROUP HEAD
- MD/CEO
 REAL LIFE AT BANK
- MANAGING QUALIT Y WORK UNDER PRESSURE

- M A I N TA I N I N G C O M P O S U R E

- C O N T I N U O U S LY BEING VIGILANT – AS DEALING WITH PUBLIC

FUNDS

- NO MARGIN FOR ERROR

- DISCIPLINED & FIT LIFE

- MEETING DEADLINE
REQUIREMENT FOR BEING A BANKER

“KASH” RQUIREMENT WITH PERSON

- K N O W L E D G E - W H E N E V E R YO U L E A R N T R Y T O R E L AT E I T W I T H
SOME REAL LIFE EXAMPLE

- AT T I T U D E – A LW AY S B E R E A DY T O A D A P T T O C H A N G E S . E V E R Y
D AY I N & O U T E N V I R O N M E N T I S C H A N G I N G .

- SKILLS - A P P L I C AT I O N O F K N O W L E D G E I S V E R Y I M P O R TA N T.

- H A B I T – A LW AY S D E V E LO P H A B I T S W H I C H C A N G I V E YO U
BENEFITS IN FUTURE. CURRENT HABIT WILL MAKE OR BREAK
YOUR FUTURE.
 INTERVIEW INSIGHTS
- N EVER EN T ER AN I N T ERVI EW W I T H A PERCEPT I O N , HAVE A CLEAR
MIND.
- A LWAY S L I ST E N F I R ST & T H E N R E V E R T.
- A LWAY S B E R E A L - D O N ’ T B O A S T A B O U T W H AT YO U C A N D O & W H AT
HAVE YO U DO N E – B E HUM B LE & RESPECT THE POSI TI ON
- BE CONFIDENT – IF NEEDED GET INTO INTERVIEW BY COMPLETING
A TA S K W H E R E I N Y O U A R E E T R E M E LY C O N F I D E N T
- SHOWING CONFIDENCE IS GOOD, BUT DON’T SHOW
OVERCONFIDENCE
- A LWAY S H AV E A N O P I N I O N A B O U T A N Y TO P I C , D O N ’ T J U ST AG R E E
W I T H W H AT I N T E R V I E W E R S AY S , I F Y O U D I S A G R E E S AY I T P O L I T E LY
- R E A D C A R E F U L LY J O B P R O F I L E & J O B D E S C R I P T I O N TA K E
KNOWLEDGE ABOUT THE COMPANY
- A LWAY S W E A R S M I L E O N YO U R FAC E
- SPEAK AS MUCH AS ASKED FOR. KEEP YOURSELF WELL READ
- D O N ’ T G I V E TO O M U C H C O N C E P T O R I N F O R M AT I O N – B E P R E C I S E
O B S E R V AT I O N B Y A N I N T E R V I E W E R
DEPENDING UPON THE PROFILE & JOB REQUIREMENT

FOR EXAMPLE : FINANCIAL PRODUCT/SERVICES SALES

- CONFIDENCE LEVEL
- WHETHER YOU KNOW YOUR STRENGTH & WEAKNESS.
- H OW YO U S E L L YO U R S E L F & H OW D O YO U TAC K L E TO U G H
QUESTIONS
- KNOWLEDGE OF FINANCE
- CLARITY OF THOUGHTS
- YOUR VISION ABOUT THE JOB & GROW TH PLANNING FOR LIFE
- S E L E C T O N LY A J O B , I N W H I C H Y O U C A N P R O J E C T Y O U R S E L F F I V E
TO TEN YEARS DOWN THE LINE, DON’T JUST SELECT IN HASSLE.
T H E R E A S O N B E I N G , M A R K E T I S F O R S P E C I A L I Z AT I O N & S H I F T I N G
M A R K E T S / J O B S W O U L D N OT M A K E YO U A S P E C I A L I S T O F T H AT
S E G M E N T. M O R E O V E R , F O R S E N I O R L E V E L G R O W T H YO U R L OYA LT Y
IS VERY MUCH NEEDED.
 EXTREMELY IMPORTANT SKILL SETS

- THROUGH KNOWLEDGE OF EXCEL

- WRITING SKILLS

- E M PAT H E T I C L I S T E N I N G S K I L L S & A R T O F P E R S U A S I O N
( C O U N T E R PA R T Y S W O T & VA L U E A N A LY S I S )

- C O M M U N I C AT I O N

- AC C E P TA N C E O F T H E F E E D B AC K & W I L L I N G N E S S TO C H A N G E BY
OVERCOMING FEEDBACK BARRIERS
QUESTIONS & ANSWER SESSION

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