A

PROJECT REPORT ON

PUNJAB NATIONAL BANK

HOUSING FINANCE LIMITED

Submitted in Partial Fulfillment of the Requirement of

Master of Business Administration (MBA)

Submitted by:
Vipul Beniwal
Roll No. 0221471708
MBA

Submitted to:
Mr Amit Gupta
Project Co-ordinator
MAIMS

ACKNOWLEDGEMENT

Success is an effort bounded actively, involving the co-operation of all.

To create and formulate this project report, I would be thankful to the entire
individual who
Served me as a true guide and epitome of knowledge.
I would like to thank Mr. AMIT GUPTA, MBA Project guide for anytime and
every time guidance and continuous support. His experience and methodology of
providing training helps me not to perform the desired activity but to accomplish
creativity. I also like to thank my parents and my family members who are always
a support for me.
In the last, but not least, Dr. N.K. Kakkar and other faculty members who are not
only the source of inspiration but a constant motivation.

DECLERATION
I, Vipul Beniwal, here by declare that I have carried out summer training project
on the topic "Comparative Customer Preference in Public and Private Sector:
Home Loans" in Punjab National Bank.
I further declare that project work is my original work and no part of this report
have been published to or submitted to anybody or university for award of any
other degree or diploma.

Mr. AMIT GUPTA

Faculty- MBA

TABLE OF CONTENT
1. NATIONAL HOUSING BANK
PROFILE
OBJECTIVES
BUSINESS/ACTIVITIES
ORGANIZATION
OFFICES
PROCEDURE FOR AVAILING HOUSING LOAN
2. PUNJAB NATIONAL BANK
HERITAGE
LOGIC OF THE LOGO PROFILE
VISION & MISSION
QUALITY POLICY
ORGANIZATIONAL STRUCTURE
CENTRALIZATION BANKING SOLUTION
VARIOUS LOANS
3. ACHIEVEMENTS AND AWARDS
4. PNB SUBSIDIARIES
PNB GILTS LTD
BACKGROUD
OBJECTIVES
PRODUCTS & SERVICES
5. PNB HOUSING FINANCE LTD.
INTRODUCTION
PRODUCTS AND SERVICES
a. APNA GHAR YOJANA
b. GHAR SUDHARYOJANA
c.
LOAN AGAINST PROPERTY
d.
LOAN FOR COMMERCIAL PROPERTY
e.
FUTURE RENTAL SCRUTIZATION
f.
LINE OF CREDIT FACILITY
BALANCE SHEET

6. RESEARCH METHODOLOGY
INTRODUCTION
MEANING OF RESEARCH RESEARCH PROBLEM RESEARCH
DESIGN
7. COMPARATIVE STUDY
SAMPLE SELECTION
SCOPE OF STUDY
DELHI MARKET SEGMENT GRAPHS
8. CONCLUSION
SWOT ANALYSIS
LIMITATIONS
9. APPENDIX
QUESTIONNAIRE
BIBLIOGRAPHY

NATION
HOUSING
BANK

PROFILE
The National Housing Bank (NHB) was established on 9th July 1988 under an
Act of the Parliament viz. the National Housing Bank Act, 1987 to function as a
principal agency to promote Housing Finance Institutions and to provide financial
and other support to such institutions. The Act, inter alia, empowers NHB to:
Issue directions to housing finance institutions to ensure their growth on sound
lines
Make loans and advances and render any other form of financial assistance to
scheduled banks
and housing finance institutions or to any authority established by or under any
Central, State or Provincial Act and engaged in slum improvement and
Formulate schemes for the purpose of mobilization of resources and extension
of credit for housing

OBJECTIVES
NHB has been established to achieve, inter alia, the following objectives:
a. To promote a sound, healthy, viable and cost effective housing finance system
to cater to all segments of the population and to integrate the housing finance
system with the overall financial system.
b. To promote a network of dedicated housing finance institutions to adequately
serve various regions and different income groups.
c. To augment resources for the sector and channelise them for housing.
d. To make housing credit more affordable.
e. To regulate the activities of housing finance companies based on regulatory and
supervisory authority derived under the Act.
f. To encourage augmentation of supply of buildable land and also building
materials for housing and to upgrade the housing stock in the country.
g. To encourage public agencies to emerge as facilitators and suppliers of serviced
land, for housing.

BUSINESS ACTIVITIES

NHB, as the Apex level financial institution for the housing sector in the country,
performs the following roles:

(a) Promotion and Development:

NHB operates as a multifunctional Development Finance Institution (DFI) for the
housing sector. The Bank's policies are directed towards promotion and
development of housing finance institutions. NHB has framed guidelines for
HFCs with a view to promoting their development on sound and healthy lines.
The guidelines are reviewed and modified from time to time in the light of
developments in the financial and housing sectors. All HFCs registered with the
National Housing Bank under sec. 29A of the National Housing Bank Act, 1987
and inter alia having minimum net owned funds of Rs.10.0 crores are eligible for
refinance support. It has also contributed to the equity capital of five HFCs. NHB
has a dedicated Training Division which organises regular training programmes in
areas relating to housing and housing finance for development of management
capabilities of officials working in the sector. NHB's promotional endeavours are
also directed towards capacity building for the housing finance system besides
enlarging the credit absorption capacity.

(b) Regulation and Supervision:

NHB exercises regulatory and supervisory authority over the HFCs in the matter
of acceptance of deposits by them pursuant to the powers vested in it under the
Act. As per the amendments to certain prov1.sions of the Act, which came into
effect from June 12, 2000, NHB is vested with powers to grant Certificate of
Registration to companies for commencing/carrying on the business of a housing
finance institution. Besides, NHB regulates the deposit acceptance activities in
accordance with the Housing Finance Companies (JHB) Directions, 2001,
amended from time to time, in the matter of ceiling on borrowings (including
public deposits, rate of interest, period, liquid assets, etc). NHB has also issued
Directions on prudential norms in regard to capital adequacy, asset classification,
concentration of credit, income recognition, provisioning for bad and doubtful
debts etc. NHB supervises the working of HFCs through on-site inspection and
off-site surveillance.

(c) Financing:
NHB raises resources for the housing sector towards increasing new housing
stock and provides refinance to a large set of retail lending institutions. These
include scheduled commercial banks, scheduled state cooperative banks,
scheduled urban cooperative banks, specialised housing finance institutions, apex
co-operative housing finance societies and agriculture and rural development
banks. Refinance is provided by NHB under various schemes, which are
formulated taking into account, several aspects of the National Housing Policy,
the constraints facing the sector etc. NHB has also a window for direct lending to
Public Agencies such as, State Level Housing Boards and Area Development
Authorities for large scale integrated housing projects and slum redevelopment
projects. NHB is also operating a special window for extending financial
assistance to the people affected by natural calamities viz. earthquake, cyclone
etc.
(d) Resources of NHB
NHB raises resources from diversified sources, both domestic and external by
Issuing Bonds/ debentures, borrowing from RBI and financial
institutions/organizations etc. Under the Act, NHB is authorized to issue and sell
Bonds with or without the guarantee of the Central Government for the Purpose
of carrying on its functions.
(e) Rural Housing:
NHB launched the "Swarna Jayanti Rural Housing Finance Scheme" to mark the
golden jubilee of India's Independence. The Scheme seeks to provide improved
access to housing loans to borrowers for construction/acquisition/ Up-gradation of
a house in rural areas of the country.
(f) Recent Initiatives
Securitization of mortgage loans of the retai11ending institutions facilitates for
canalizing household savings into the housing sector is seen as a potentially viable
market oriented alternative. Support to Mortgage backed securitization is a major
policy initiative of the Government as manifested in its National Housing and
Habitat Policy announced in 1998. This policy emphasizes NHB's lead role in
mortgage-backed securitization and development of a secondary mortgage market
in the country. As the apex body in housing finance sector in India, NHB has been
playing a lead role in the sector in matters relating to policy environment as also
operational mechanism for the development of a secondary mortgage market in
India.

In order to resolve the twin problems of affordability and accessibility affecting

the growth of the housing finance business and the prospect of home ownership,
NHB has been entrusted with the responsibility of launching a Mortgage Credit
Guarantee Scheme for protecting the lenders against default.

ORGANISATION

NHB is an Officer Oriented Organization and has the following departments.

1. Regulation and Supervision
2. Board and CMD Secretariat
3. Legal
4. Information Technology
5. Enabling Processes
6. Resource Mobilization and Management
7. Refinancing Operations
8. Project Finance
9. Development and Risk Management

OFFICES
Head Office:
National Housing Bank
Core 5A, India Habitat Centre,
3rd-5th floor, Lodhi Road,
New Delhi - 110 003
Phone No - 011-24649031 - 35
FAX - 011-24646988,24649041
Regional Office:
National Housing Bank
Mumbai Life Building,
45, Veer Nariman Road,
Fort Mumbai - 400 023
Phone No - 22851560-64
FAX - 022-22851555

PROCEDURES FOR AVAILING HOUSING LOANS

The appraisal officer attends to the queries of a prospective borrower.
Various details. E.g., eligibility at al are discussed during this meeting.
You collect the application form, which is generally available at the reception
counter.
You pay the processing fees, which is about 1% of the loan amount. The fees are
non-refundable. Generally you are asked to pay the fees only if the chances of the
loan getting sanctioned are really good as per the Officer's analysis.
The date of the personal interview is fixed up as per mutual convenience.
The appraisal Officer conducts the interview.
The Appraisal Officer prepares the file and discusses the case with the Branch
Manager. The Branch Manager should substantiate recommendations of the
Appraisal Officer. The file is then recommended for sanctioning by the competent
authority.
The competent authority concerned sanctions the loan proposal. In case there are
some queries, the same have to answer by the Appraisal Officer to the satisfaction
of the sanctioning authority.
If approved, you collect the Loan Offer letter. You fill Property Details form and
Acceptance Note and sign the same. This signifies your acceptance of the
proposal. Then, you are required to collect the disbursement within a month of the
acceptance of the offer letter failing which a Commitment Charge of generally 1%
on the loan is levied.
The Legal and Technical fees is generally 1% of the loan sanction is paid by the
borrower. The file is then transferred to the Legal department. You submit the
legal documents to the Legal Officer. The Loan Agreement and the other
documents are signed. The Legal Officer then prepares the Legal report after
studying the legal documents in depth.
The Technical Officer visits the property and submits the technical Report. The
Technical officer as per the stage of completion recommends the amount for
disbursement.
The Disbursement Memo is prepared and is signed by the Appraisal, Legal and
Technical Officers, and countersigned by the Branch Manager.
The accounts department prepares the cheque which is then sent to the
authorized signatories. The Disbursement Memo is attached with important
documents like interview sheet, Legal Report, Technical Report, PEMI Status
Report applicable etc.

 The PEMI cheque of the amount disbursed is collected before releasing the
disbursement amount cheque. PEMI is the interest charged on the amount already
disbursed by the company
Consequent to the final disbursement of the EMI starts which amortizes the
interest and adjust the principle for the tenure allotted.
The documents mortgaged are released on closure of loan.

PUNJAB
NATIONAL
BANK

HERITAGE
Established in 1895 at Lahore, undivided India, Punjab National Bank (PNB) has
the distinction of being the first Indian bank to have been started solely with
Indian capital. The bank was nationalized in July 1969 along with 13 other banks.
From its modest beginning, the bank has grown in size and stature to become a
front-line banking institution in India at present.

A professionally managed bank with a successful track record of over

110 years.

Largest branch network in India - 4062 branches and 447 Extension

Counters spread throughout the country.

Strategic business area covers the large Indo-Gangetic belt and the
metropolitan centers.

Ranked as 323rd biggest bank in the world by Bankers Almanac (January

2006), London.

Strong correspondent banking relationships with more than 217

international banks of the world.

More than 50 renovv11ed international banks maintain their Rupee

Accounts with PNB.

Well equipped dealing rooms; 20 different foreign currency accounts are

maintained at major centers all over the globe.

Rupee drawing arrangements with M/s UAE Exchange Centre, UAE, M/s
Al Fardan Exchange Co. Doha, Qatar,M/s Bahrain Exchange Co, Kuwait,
Mis Bahrain Finance Co, Bahrain,M/s Thomas Cook Al Rostamani
Exchange Co. Dubai, UAE, and M/ s Musandam Exchange, Ruwi,
Sultanate of Oman.

LOGIC OF THE LOGO

Established in 1895 at Lahore, then undivided India, Punjab National

Bank (PNB) has the distinction of being the first Indian bank to have been started
solely with Indian capital. The bank was nationalized in July 1969 along with 13
other banks. From its modest beginning, the bank has grown in size and stature to
become a front-line banking institution in India at present. It has more than 4000
branches and over 400 extension counters. Strong correspondent banking
relationship, which it maintains with over 200 leading international banks all over
the world, enhances its capabilities to handle transactions worldwide. More than
50 renowned international banks maintain their Rupee Accounts with PNB.
With its presence virtually in all the important centers of the country, PNB offers
a wide variety of banking services which include corporate and personal banking,
industrial finance, agricultural finance, financing of trade and international
banking. The large presence and vast resource base have helped the bank to build
strong links with trade and industry. At the same time, the bank has been
conscious of its social responsibilities by financing agriculture and allied activities
and small-scale industries.
The bank is committed to maintaining the highest standards of service and will be
covering more offices under this quality movement titled 'Alliance with Quality'.

PROFILE
With its presence virtually in all the important centres of the country, Punjab
National Bank offers a wide variety of banking services which include corporate
and personal banking, industrial finance, agricultural finance, financing of trade
and international banking. Among the clients of the Bank are Indian
conglomerates, medium and small industrial units, exporters, non-resident Indians
and multinational companies. The large presence and vast resource base have
helped the Bank to build strong links with trade and industry.
Punjab National Bank is serving over 3.5 crore customers through 4062 branches
and 447 extension counters - largest amongst Nationalized Banks. The Bank was
recently ranked 21st amongst top 500 companies by the leading financial daily,
Economic Times. PNB's attempts at providing best customer service has earned it
9th place among Indias Most Trusted top 50 service brands in Economic
TimesA.C Nielson Survey. PNB is also ranked 368 amongst the top 1000 banks in
the world according to "The Banker" London.
At the same time, the bank has been conscious of its social responsibilities by
financing agriculture and allied activities and small scale industries (SSI).
Considering the importance of small scale industries bank has established 31
specialised branches to finance exclusively such industries.
Strong correspondent banking relationship which Punjab National Bank maintains
with over 200 leading international banks all over the world enhances its
capabilities to handle transactions world-\vide. Besides, bank has Rupee Drawing
Arrangements with 15 exchange companies in the Gulf and one in Singapore.
Bank is a member of the SWIFT and over 150 branches of the bank are connected
through its computer-based terminal at Mumbai. with its state-ofart dealing rooms
and well-trained dealers, the bank offers efficient forex dealing operations in
India.
The bank has been focussing on expanding its operations outside India and has
identified some of the emerging economies which offer large business potential.
Bank has set up representative offices at Almaty: Kazakhistan, Shanghai: China
and in London. Besides, Bank has opened a full fledged Branch in Kabul,
Afghanistan.
Keeping in tune with changing times and to provide its customers more efficient
and speedy service, the Bank has taken major initiative in the field of
computerization. All the Branches of the Bank have been computerized. The Bank
has also launched aggressively the concept of "Any Time, Any Where Banking"
through the introduction of Centralized Banking Solution (CBS) and over 2000
offices have already been brought under its ambit.
PNB also offers Internet Banking services in the country for Corporates as wen as
individuals. Internet Banking services are available through all Branches of the
Bank networked under CBS. Providing 24 hours, 365 days banking right from the
PC of the user, Internet Banking offers world class banking facilities like anytime,
anywhere access to account, complete details of transactions, and statement of

account, online information of deposits, loans overdraft account etc. PNB has
recently introduced Online Payment Facility for railway reservation through
IRCTC Payment Gateway Project and Online Utility Bill Payment Services which
allows Internet Banking account holders to pay their telephone, mobile,
electricity, insurance and other bills anytime from anywhere from their desktop.
Another step taken by PNB in meeting the changing aspirations of its clientele is
the launch of its Debit card, which is also an ATM card. It enables the card holder
to buy goods and services at over 99270 merchant establishments across the
country. Besides, the card can be used to withdraw cash at more than 11000
ATMs, where the 'Maestro' logo is displayed, apart from the PNB's over 600
ATMs and tie up arrangements with other Banks.

QUALITY POLICY
To effectively meet customers' requirements and endeavor to achieve total
customer satisfaction.
To gain consistent faith and confidence of customers and potential customers
regarding the quality of services rendered.
To pursue excellence through continuous improvement in all areas and to
distinguish ourselves by the quality of our services.
To achieve operational efficiency by attaining better productivity and profitability.
To work and act in such a manner that all services rendered in due course of
banking lead to excellence and improved credibility and image of the Bank.

ORGANISATIONAL STRUCTURE

Bank has its Corporate Office at New Delhi and 25 Zonal Offices which in turn
supervise 48 Regional Offices under which the branches function. The delegation
of powers is decentralised upto the branch level to facilitate quick decision making.

BOARD OF DIRECTORS
Shri s.c. Gupta
Shri K. Raghuraman
Dr. K.V. Rajan
Shri P .K. N ayar
Shri Mohan Lal Bagga
Shri A.S. Agarwal
Dr. Harsh Mahajan
Shri Mohanjit Singh
Shri Prakash Agarwal

Chairman & Managing Director

Executive Director
RBI Nominee Director
Officer Employee Director
Workmen Employee Director
Non Executive Director
Shareholder Director
Shareholder Director
Shareholder Director

CENTRALISED BANKING SOLUTION

Welcome to the new age of banking convenience with PNB.

PNB now brings to you Centralized Banking Solution (CBS). An inter branch
networking and data sharing platform, which makes 'Anytime Anywhere' banking a
reality. With over 1000 branches to be networked in the near future, the status of
costumers is changing from 'Customer of the branch' to 'Customer of the bank'.
CBS- 'BENEFITS' TO CUSTOMERS

Instant fund transfers

Cheques collection/deposit across cities.
Cheques can be deposited at the center where it is drawn .
Interconnected ATM's
Access of accounts through any CBS connected branch
SWIFT remittance facility
Instant generation of statement of accounts
PNB Prudent Sweep- Scheme for Saving Fund A/C Holders
PNB Smart Roamer- Scheme for Current A/C Holder (Sweep in and Sweep
out facility.

At present CBS facility is available in 1229 Service Outlets.

DIFFERENT TYPES OF LOAN PROVIDED BY PNB

 CONSUMER LOAN
Q. Who can avail Consumer Loan?
A. Any Individual with a monthly income of minimum Rs.5000/Q. What type of consumer durable can be financed?
A. New consumer durable such as Refrigerator, Television, Air conditioner, Microoven, Cooking Range, Washing Machine, Music System, Furniture, Personal
Computer, etc.
Q. How the loan is disbursed?
A. The amount of loan shall be paid directly to the supplier of goods along with the
margin of the borrower.
Q. What will be the total loan amount?
A. 90% of the cost of consumer durable, subject to maximum of Rs.l lac. However,
the minimum amount of loan shall be Rs.I0000/Q. What is the repayment period?
A. Amount of loan together with Interest shall be repayable maximum in 60 equal
monthly installments.
Q. What is the rate of Interest charged?
A. At present Interest rate is 15 % (min.). This is subject to change.
Q. Whether Interest applicable is at a flat rate or at reducing balances?
A. Interest is charged on reducing balances.
Q. What formalities are to be completed for availing the facility?
Performa Invoice of consumer durable(s) to be purchased.
Proof of residence
Proof of Income
Details of guarantor.

CARLOAN

Q Who can avail Car Loan?

A. Individuals and Business Concerns.
Q Whether finance is also available for used cars?
A. Finance is also available for purchase of used cars not older than 3 years.
Q How much loan can be availed under the scheme?
A For individuals, loan amount shall be 25 times the Net Monthly Salary /Income,
subject to maximum of Rs7.00 lac or 80% of the cost of the vehicle whichever is
less. In case of business concerns, loan amount can be need based and is not
subject to any ceiling.
Q Whether the income of the spouse is also taken into account for determining
the amount of loan?
A Yes, income of the spouse can also be taken into account for determining the
amount of loan. In such cases, the spouse shall stand a guarantor.
Q What will be the repayment period?
A. Amount of loan together with interest shall be repayable maximum in 84 equal
monthly installments. However, for old car, loan together with interest is to be
repaid maximum in 60 equal monthly installments.
Q What is the rate of interest charged?
A.
AMOUNT
UNDER FLOATING RATE OF
INTEREST OPTION (% p.a)
Upto Rs. 2 Lakh
12.25
Over Rs. 2 Lakh and for 12.75
professionals
Over Rs. 2 Lakh and for 13.25
others

UNDER FINANCIAL
BASKET
11.75
11.75
11.75

Q Whether interest applicable is flat rate or at reducing balance?

A. Interest is charged on reducing balance.

Q What formalities are to be completed for availing the facility?
A. The following documents are required to be submitted:
Proforma Invoice of Car to be purchased.
Proof of residence
Proof of Income
Details of guarantor.

PROFESSIONAL LOAN

Q. Who is eligible to get loan under the scheme?

A. The following categories of professionals are eligible to get loan under the
scheme:
Persons already practicing or new entrants in various professionals, having
licenses issued under Central or State Legislations .
Associations of persons engaged in a single profession provided that each
member of such an association is qualified and duly licensed to practice in the
profession; and
The qualified professionals will be required to produce a certified copy of the
license for the record at the bank.
Q. What is the purpose for which advance is sanctioned?
A. Loans under this scheme may be granted for the purpose of financing purchase
of equipment used by the borrowers, business premises, construction, making
alterations or renovation of business premises/nursing homes or for working capital
requirements, in their professions.
Q. How many loans can be availed under this scheme?
A. Amount of loan : Need based on merits within the overall permissible limits as
under: Metro/ Urban S.Urban/Rural Area
l. Medical practitioners 5.00 lac 10.0 lac
2. Other professionals 5.00 lac 5.00 lac
3. Margin: Nil up to Rs.25000/-. 25% Above Rs.25000jQ. What is the rate of Interest charged?
Details
Rate Of Interest (% P.a)
Upto Rs. 2 Lakh & Working Capital
11.25
Upto Rs. 2 Lakh & Term Loan
11.75
Upto Rs. 10 Lakh for Medical
11.75
Practitioners
Above Rs. 10 Lakh for Medical
12.75
Practitioners
Others Working Capital
13.25
Others Term Loan
13.75

Q. What will be the repayment period for the term loan?

A. Repayment will be in equal monthly installments within the following
periods:- Loans up to RS.50000/- 48 months Loans beyond Rs.50000/- 60
months

Q. What is the procedure for disbursement of the loan?

A. Payment will be made direct to the suppliers/ dealers. In case of construction
of the premises, the loan may be disbursed in phases after verifying the end use in
terms of the plan as also at the spot.

EDUCATION LOAN

Q. What are the types of education for which education loans are given?
A. Education loans are given for pursuing all types of education viz. general,
professional, technical and vocational courses.
Q. Which costs are financed under the scheme?
A. The scheme enables the needy students to meet the following costs for studies in
India as well as abroad: admission fees, books & stationery, instruments required
for the course, monthly fees, examination fees, insurance premium for policy on
life of the borrowing student, caution deposit/ building fund/refundable deposit
supported by bills/ receipts, expenses like study tours/ project work/ thesis etc.
required to complete the course, boarding and lodging expenses, and travel
expenses/ passage money including air fare for joining the course abroad.
Q. Who is eligible to get loan under the scheme?
A. The following is the eligibility criteria for getting loan under the scheme:
Indian nationals, in the age group of 16-40 years. For part time computer
courses, applicants in the age group of 16-45 years are eligible.
Students who have scored pass marks in their last qualifying examination and
have secured admission in the courses mentioned above.
The parents/ guardian should have regular source of income to the extent that
they are able to repay the loan in case of need/ unforeseen circumstances.
Employed persons intending to better their prospects can also avai110an for
improving their educational qualifications and! or receive training in modern
technology in India/ abroad.
Q. How much loan amount can I avail?
A. This is co-related to expenses involved in taking up the course and the expected
earnings after qualifying, subject to a maximum of:
For studies in India: Rs. 7.50 lacs
For studies abroad: Rs.15.00 lacs
Q. How much loan amount can I avail for pursuing part time computer
courses?
A. In case of part time computer courses, the extent of loan should not exceed Rs.
50,000/ - per annum or fee fixed by the particular institution (as per prospectus less
concession, if any), whichever is less.

Q. What is the security required by the bank?

A. The following additional security in addition to the personal liability of the

borrower is required:
Loan up to Rs. 5.00 lacs: Co-obligation of either or both parent(s) or
guardian(s) and the LIC Policy for equivalent to the amount of loan.
Loan above Rs. 5.00 lacs: Co-obligation of parent(s) or guardian(s) and
Collateral Security or third party guarantee acceptable to the bank equivalent to
100% of the amount of loan.
Loan above Rs. 500 lacs: Co-obligation of parent(s) or guardian(s) and
Collateral Security or third party guarantee acceptable to the bank equivalent to
100% of the amount of loan
Q. What is the rate of interest charged in the loan?
AMOUNT
UNDER FLOATING
UNDER FINANCIAL
RATE OF INTEREST
BASKET
OPTION (% p.a)
Upto Rs. 4 Lacs
11.75
11.25
Above Rs. 4 Lacs & Upto 12.75
11.25
Rs. 15 Lacs
The Interest rates are subjected to change from time to time.
Q. What is the method of application of interest in the loan?
A. The interest shall be charged at simple rate from the date of disbursement till the
commencement of repayment of loan. Thereafter, compound interest is charged on
reducing balance.
Q. When does the repayment of loan commence?
A. Repayment "Will commence after two years of the completion of studies by the
borrower or one month after his/ her getting employment, whichever is earlier.
Q. What is the repayment schedule?
A. Principal and interest is repayable in 84 monthly installments.
Q. Is there any stipulation about ceiling on annual income of parents/
guardian?
A. No, there is no stipulation of ceiling on annual income of the parents/ guardians.

KRISHI CARD

Q. Can I raise loan under this scheme for activities

other than Agriculture?
A. Yes, for other rural household requirements such as education, consumable
items, medical expenses, etc. up to 25% of the limit or Rs.25,ooo/- whichever is
lower.
Q. Do I need minimum qualification to be eligible under the scheme?
A. No.
Q. If I have 5 acre of un irrigated land, am I eligible under the scheme?
A. Yes.
Q. Can I take the payment from the other branches also?
A. Yes, but within the same district whereas the illiterate cardholders will avail the
facility from the issuing branch only.
Q. Do I have to pay any additional fee/charge for withdrawing cash from other
than the issuing branch?
A. Yes, if you withdraw cash from the branch other than the issuing branch a
commission @2% is charged and the same is deducted from the cash withdrawn.
Q. If I want to renew my Krishi Card what formalities are required?
A. You should approach the issuing branch one month before the expiry of the card
with a written request for the same.
Q. Is there any concept of the margin under the scheme?
A. For limits up to Rs. 2,00,000/-, the margin requirements are nil. For limits above
Rs.200,OOO/- up to Rs. 3,00,000/-, margin requirement is 10%.
Q. In case of loss of card/passbook what are the formalities?
A. Inform the card issuing branch by quickest means and a new card is re-issued on
payment of nominal charges of Rs.200/-.
Q. How do you work out the eligible limit?
A. The limit is worked out on the basis of your total income from farm as well as
non-farm activities, extent of land holding, acreage and average yield of crops
grown, price realizations etc.
Q. How do I repay the amount raised against the card?

A. Aggregate credits into the account during the 12/18 months period as the case
may be, should at least be equal to the maximum outstanding in the account. The
cardholder will also have to maintain his/her cash credit account in credit balance
for at least one week once a year. However, the consumption loan portion shall be
adjusted within a period of three years. An the repayments/deposits by the
cardholder shall be made at the card-issuing branch only.

ACHIEVEMENTS
AND
AWARDS

SKOTCH Challenger Award

for Change Management for the year
Best IT User in Banking & Financial Services 2005-06
by NASSCOM in partnership "With
Economic Times
Industry - 2004
Golden Peacock Award
for Excellence in Corporate
Governance
- 2005 by Institute
of Directors
FICCI's Rural Development Award
for Excellence in Rural Development 2005
Skotch Challenger Award for Exemplary use of
for becoming a pioneer in Public Banks
Technology
Golden Peacock National Training - 2004 &
by Institute of Directors
2005
Ranked 2nd for 4 consecutive years
National Award for Excellence in SSI Lending
2002, 2003, 2004 &
2005
Banking Technology Awards 2004 Runner up in
Jointly Adjudged by IBA, Finacle &
TFCI
'Best IT Team of the Year Award 2005'
Money Outlook Award - 2004 Runner up in
'Best Bank (public Sector) of the year Award' 2005
for excellence in export performance
Niryat Bandhu Gold Trophy
for 3 consecutive
years 2001, 2002 & 2003 by Federation
Organization (FlEO)
by the leading Financial Daily The
Economic Times, June
2005
A.C Nielson Survey, The Economic

21st Amongst Top 500 Companies

9th amongst India's Top 50 Most Trusted

Times

Service Brands
3rd Rank amongst Banking Sector in India

The Bankers' Almanac, January 2006

323rd Rank in the World

368 amongst Top 1000 Global Banks

The Banker, London July 2005

PUNJAB
NATIONAL
BANK
SUBSDIARIES

PNB Gilts LTD

A Subsidiary of Punjab National Bank which was amongst the first ones to get the
license for undertaking activities in the Government Security market, as a primary
dealer in 1996. The company received ISO 9002 certification from British Standard
Institution, making it as the first primary dealer in India to achieve this certification

for its quality systems and procedures. This certificate has been granted to the
company as a whole including its corporate and branch offices.

MISSION

BACKGROUND
In the year 1996 Reserve Bank of India introduced the system of Primary Dealers
with a view to strengthen the institutional infrastructure of Government Securities
market. Six entities were granted licenses of which PNB Gilts was one. The
Company was established as a wholly owned subsidiary of PUNJAB NATIONAL

BANK with an initial paid up capital of Rs.50 crores which is also the minimum
capital requirement for a Primary Dealer.

The net-worth of the Company has increased from Rs.50 crs to Rs.541.33 crs in a
span of 8 years.
RBI, New Delhi, granted its certificate of registration vide its letter dated 10th
February 1998, to carryon the business of a Non-Banking Finance Company. The
Company decided to expand its capital base & came with an IPO of Rs.3.5 crore
shares at an offer price of Rs 30/- per share aggregating Rs.105 crore in July :woo.
This increased the paid up capital of the Company to Rs 135.01 crores and reduced
the holding of Punjab National Bank to 74.07%.

OBJECTIVES

The objectives of the Company are in line with objectives laid down by RBI for the
Primary Dealers:

Strengthen the infrastructure in the government securities market in order to

make it vibrant, liquid and broad based.
Ensure the development of underwriting and market making capabilities for
Government Securities.
Improve secondary market trading system, which would contribute to price
discovery, enhance liquidity and turnover and encourage voluntary holding of
Government securities amongst a wider investor base.
Become an effective conduit for conducting open market operations.

Besides the above, the Company has been pioneer in retailing of Government
Securities contributing to a deep and broad-based market. The Marketing
Department specifically caters to select segments viz. Provident Funds, Trusts,
Regional Rural Banks, Co-operative Banks, Corporate & Individuals to create
awareness and encourage healthy investment practices.

PRODUCTS & SERVICES

Being a primary dealer in the Government Securities Market the company

undertakes more than 90% of its operations in Government Securities. The range of
product and services offered by the company includes:

Treasury Bills
Central Government Dated Securities
State Government Securities
PSU Bonds
Inter-Corporate Deposits
CSGL accounts
Money market instruments
Merchant Banking
Mutual Fund Distribution

In addition to the above, we also offer advisory services to our clients to manage
the government securities portfolio.
The Company has well-defined systems and procedures. The Internal Control &
Management systems are in place and are in accordance with the guidelines issued
By the Regulatory Authorities.
The Company has a lean staff of 38 employees spread over the Country with 31
employees in the Head Office in New Delhi & rest in our branches at Mumbai,
Chennai, Kolkata, Ahmedabad and Bangalore.
During the years the Company has emerged as a leading Primary Dealer in the
country. We have to our credits ...

The first stand alone Primary Dealer to come with an IPO & get listed.
The first PD to achieve ISO 9001:2000 certification.
The first to obtain a PH rating from CRISIL for its short-term borrowing
program. At present the rating from CRISIL is for borrowing up to Rs 250
crore.
The company has achieved a turnover of Rs.116468 crores during 2003-2004,
making it one of the largest debt traders in the country.

PUNJAB
NATIONAL
BANK
HOUSING
FINANCE
LTD.

INTRODUCTION
This is a wholly owned subsidiary of Punjab National Bank, is engaged in
providing housing loans for purchase, construction and up gradation of a dwelling
unit. The company offers Loans for construction or for purchase of house/flat from
development authorities and also from private builders/ group housing societies as
well as for renovation/ repairs .Company also provide finance for construction of
residential projects. Loans to NRIs are also provided for purchase/ construction of
house/ flat along with a resident/ non-resident co-borrower.

PRODUCTS AND SERVICES

APNA GHAR YOJANA

GHAR SUDHAR YOJANA
LOAN AGAINST PROPERTY
LOAN FOR COMMERCIAL PROPERTY
FUTURE RENTAL SECURITISATION
LINE OF CREDIT FACILITY

APNA GHAR YOJANA

We provide housing finance to individuals for construction or for
acquisition/ purchase of house/flat from development authorities such
as DDA/HUDA/PUDA/RHB etc. and also from private
builders/groups housing societies. We consider enhancement in loan
amount in the event of escalations in cost.
ELIGIBILITY:
a) Individuals in permanent service or having their own business
(Resident or non -resident).
b) Age of the applicant should not be more than 60 years in case of
service class and 65 years in case of businessman or self employed;
LOAN AMOUNT:
a) Minimum loan amount would be Rs.50,000/- and maximum loan
amount depends entirely on the repayment capacity of the
borrower(s).
b) Actual loan eligibility shall be on the basis of repayment capacity
as determined be PNBHFL taking into account income, age,
qualification and occupation.
c) Income of borrower(s) j co-borrower(s) shall be clubbed together
for calculation of loan eligibility / the level of finance in case of joint
application
MARGIN:
The borrower's contribution shall be minimum 20% of the total cost
of project, including stamp duty and registration charges.
INTEREST RATES: (Effective from 1.07.2006)

PERIOD
1-10 Years
11 15 Years
16 20 Years

FLOATING RATE OF
INTEREST(%)
9.00
9.25
9.50

3-YEARLY FIXED
RATE OF INTEREST
(%)
10.50
10.50
1.50

SECURITY:
Security for the loan is first charged by way of equitable/registered mortgage of the
property to be financed and/ or such other collateral securities as may be necessary.
Loans to allottees of flats/houses of development authorities or members of co-op.
housing societies or reputed private builders can be considered on the basis of
tripartite agreement and/or interim security. With respect to property under
construction, interim security may be required. Collateral/interim security may be
assignment of Life Insurance Policies, guarantees from sound and solvent
guarantors, pledge of marketable shares and such other investments acceptable to
PNBHF.
LOAN DISBURSEMENT:
For outright purchase of house/flat, the loan amount will be paid in lump-sum to
the vendor at the time of registration after satisfying that the borrower has
paid/provided for the balance amount. For houses/flats under construction, the loan
amount will be disbursed in stages based on the progress of construction.
Disbursement win be made after the property has been technically appraised and all
legal documentation has been completed. The borrower has to invest his
proportionate share of the cost, prior to disbursement of loan.
The loan can be disbursed either in lump sum or installments according to the
requirement of the development authority/society/ private builder.
LOAN REPAYMENT:
Loan repayment shall normally be in Equated Monthly Installments (EMI)
comprising of principal and interest over a maximum period of 20 years. The table
below shows the EMI for a loan of Rs. 1,00,000/- at different rates of interest.

No. of
Years
9.00% 9.25%
/Term of
loan

9.50%

9.75

10.00

10.25

10.50

10.75 11.00 11.25

2076

2088

2101

2113

2125

2138

2150

2162 2175 2187

1609

1622

1635

1648

1661

1674

1687

1700 1713 1726

1267

1281

1294

1308

1322

1336

1350

1364 1378 1392

1015

1030

1045

1060

1075

1090

1106

1121 1137 1153

05
07
10
15

20

900

916

933

949

966

982

999

1016 1033 1050

SPECIAL REPAYMENT PLANS

In deserving cases, installments may be fixed in increasing/decreasing order or in
lump sum or even linked to Life Insurance Policies, under PNB Housing Finances
special repayment plans like:

Graduated repayment plan

Decreasing repayment plan

LIC linked repayment plan

Balance payment facility

GHAR SUDHAR YOJANA

Under "Ghar Sudhar Yojna", we make available housing finance to individuals for
up gradation, renovation or repair of house/flat. It includes among others, internal
& external repairs, water proofing, roofing, flooring, electrical, woodwork etc.

ELIGIBILITY:
Individuals who are in permanent service or self employed or have their own
business. Age of the applicant should not be more than 60 years.
LOAN DETAILS:
Loan Amount
Minimum amount of loan is Rs. 50,000. Maximum amount of oan shall not exceed
Rs. 10,00,000. Borrower's minimum contribution will be 25% of the estimated cost
of repairs/renovations. Actual loan amount shall be calculated on the basis of
repayment capacity of the borrower as determined by PNBHFL.
INTEREST RA.TES (With effect from 1.07.2006)
For loans upto Rs.10 Lakhs
Period
Upto 15 Years

Rate of Interest (%)

11.25

For loans above Rs.10 Lakhs

Period
Upto 15 Years
Upto 10 YRS rate of interest is 9 %

Rate of Interest (%)

11.00

SECURITY:
Normally, the security for the loan shall be first charge by way of
Equitable/Registered mortgage of the property. However, PNB Housing Finance at
its discretion, can sanction a loan on the basis of:
Pari-passu/second charge in the case of Central/State Govt./Public
Sector/Nationalized Bank employees and other similar bodies or
Other securities such as assignment of LIC policies (surrender value at least
equivalent to the amount of loan), pledge of marketable shares and such other
investments acceptable to PNBHF. Besides this, personal guarantee from sound
and solvent guarantors may be asked for.

LOAN DISBURSEMENT:
A loan will be disbursed in lump sum or in stages (not more than three) based on
the progress of renovation/repair. Disbursement will be made after the property has
been technically appraised and all legal documentation and other formalities have
been completed. The borrower has to invest his share of the cost in full prior to
disbursement of the loan. The borrower is expected to complete the
repair/renovation within six months.
REPAYMENT:
Loan repayment shall normally be in Equated Monthly Installments (EMI)
comprising of principal and interest over a maximum period of 10 years.

Monthly reducing Balance (%)

No. of
Years 9.00 9.25 9.50 9.75 10.00 10.25 10.50 10.75 11.00
1
2
3
4
5
6
7

11.25

8746 8757 8769 8780 8792

8804

8815

8827

8839

8850

4569 4580 4592 4603 4615

4627

4638

4650

4661

4673

3180 3192 3204 3215 3227

3239

3251

3263

3274

3286

2489 2501 2513 2525 2537

2549

2561

2573

2585

2597

2076 2088 2101 2113 2125

2138

2150

2162

2175

2187

1803 1815 1828 1841 1853

1866

1878

1891

1904

1917

1609 1622 1635 1648 1661

1674

1687

1700

1713

1726

8
9
10

1466 1479 1492 1505 1518

1531

1545

1558

1571

1585

1355 1368 1381 1395 1408

1422

1436

1449

1463

1477

1267 1281 1294 1308 1322

1336

1350

1367

1378

1392

LOAN AGAINST PROPERTY

We provide loans to individuals against mortgage of their existing residential
immovable property situated in urban/semi-urban/metro centres. Finance would be
made available for personal requirements of borrowers such as education, marriage
of children, family function, foreign travel, medical expenses, furnishing the house,
buying a computer or other consumer durables, etc. by mortgaging their existing
immovable property.
ELIGIBILITY:
Any individual having regular source of income can apply for the loan. Age of the
applicant should not be more than 55 years.
LOAN AMOUNT:
Minimum loan amount would be Rs. 50,0001-. Maximum Loan Amount would be
50 % of the market value of the property as certified by PNBHF's approved valuer

OR actual loan eligibility as determined on the basis of repayment capacity of the

borrower, whichever is less. In case other earning family members are offered as
co-borrowers, their income can also be clubbed with that of the borrower for
computation of eligible loan amount.
INTEREST RATES: (With effect from 1.07.2006)
Interest rate for individuals will be 11.50% and for builders (floating rate) will be
12.00%
SECURITY:
We shall require Equitable I Registered Mortgage of property against which loan is
being sought. Guarantee of one/ two persons will be required as per existing
guidelines of the company.
LOAN DISBURSEMENT
The loan would be disbursed directly to the borrower in lump sum through his bank
account. Disbursement will be made after the property has been technically and
legally appraised and legal documentation has been completed.
LOAN REPAYMENT
The loan would be repaid by way of Equated Monthly Installments (EMIs)
consisting of principal and interest within a maximum period of 15 years.
Repayment will commence in the month subsequent to the month in which loan
has been disbursed.

LOAN FOR C0MMERCIAL PROPERTY

We provide loans to individuals against mortgage of their existing residential
immovable property situated in urban/semi-urban/metro centers. Finance would be
made available for personal requirements of borrowers such as education, marriage
of children, family function, foreign travel, medical expenses, furnishing the house,
buying a computer or other consumer durables, etc. by mortgaging their existing
immovable property.
ELIGIBILITY:
Any individual having regular source of income can apply for the loan. Age of the
applicant should not be more than 55 years.
LOAN AMOUNT:
Minimum loan amount would be Rs. 50,000/-. Maximum Loan Amount would be
50 % of the market value of the property as certified by PNBHF's approved value
OR actual loan eligibility as determined on the basis of repayment capacity of the

borrower, whichever is less. In case other earning family members are offered as
co-borrowers, their income can also be clubbed with that of the borrower for
computation of eligible loan amount.
INTEREST RATE: (With effect from 1.07.2006) Interest rate both for individuals
and builders will be 12.00%.
SECURITY:
We shall require Equitable/Registered Mortgage of property against which loan is
being sought. Guarantee of one/ twu persons "vill be required as per existing
guidelines of the company.
LOAN DISBURSEMENT
The loan would be disbursed directly to the borrower in lump sum through his bank
account. Disbursement will be made after the property has been technically and
legally appraised and legal documentation has been completed.
LOAN REPAYMENT
The loan would be repaid by way of Equated Monthly Installments (EMIs)
consisting of principal and interest within a maximum period of 10 years.
Repayment will commence in the month subsequent to the month in which loan
has been disbursed.

FUTURE RENTAL SECURITISATION

For the convenience of our borrowers, we have started innovative scheme wherein
we provide loan against assured rental receivable for their owned property which
has been let out to reputed/ govt. companies.

ELIGIBILITY:
Property owners having properties at Metro/Urban/Semi-urban areas who have let
out their properties to Public Sector Undertakings/Government/Semi_ government
and reputed corporate, banks, financial institutions and multinational companies
can avail loan against future rental receivable.
LOAN AMOUNT:

Maximum Loan Amount would be 80 % of the total future rent receivable within
the un-expired period of lease deed subject to a maximum period of 10 years. Loan
amount will be restricted to a maximum of 80% of the market value of the
property.
INTEREST RATE: (With effect from 1.07.2006) The rate of interest will be
11.50%.
MARGIN:
Minimum contribution of the borrower would be 20% of the future rent receivable
with the loan period.
SECURITY:
We shall require Equitable Registered Mortgage of the property against the rental
of which the loan is being sought.
LOAN DISBURSEMENT
In case of purchase of the property, the loan would be disbursed directly to the
borrower, in lump sum or as per demand there from. In case of construction, the
loan would be disbursed in stages (maximum being 3) based on the progress of
construction. Disbursement will be made after the property has been technically
appraised and all legal documentation has been completed. Disbursement would be
made only after borrower contribution has been invested in full.

LOAN REPAYMENT
The loan would be repaid by way of Equated Monthly Installment (EMI) consisting
of principal and interest within a maximum period of 10 years. Repayment will
commence in the month subsequent to the month in which loan has been disbursed.
In case of construction repayment will commence with effect from the month
subsequent to the month in which last installment of loan is released and till the
time Pre-EMI Interest will be charged.

LINE OF CREDIT FACILITY

We offer corporate bodies a special facility of Line of Credit (LoC) facility which
facilitates Home Ownership among its employees. The scheme facilitates a
company to build its human resource by providing financial assistance to its
employees for owning a house. The company can also save the funds otherwise
required for building accommodation for their staff. Employees when they get an
accommodation oftheir choice would contribute a great deal towards building an
organisation. The loans sanctioned are liberal and disbursements under this facility
faster. Employees are assisted in every ways and need not take time off from work
for complying with various formalities. A LOC facility granted to a company can
be utilised to give loans to their employees for the purchase, construction or
extension of residential units anywhere in India. A company can apply in the
prescribed Corporate Application Form available at our offices along with the
information/documents mentioned in the application form. After a LOC is
sanctioned and the offer accepted, disbursement will be made after completion of
legal and technical formalities.

AMOUNT OF LOC
A company can apply for an LOC under both the schemes based on the anticipated
demand for housing loans from its employees within the next one year. When this
LOC is fully utilized, the Company can apply for another LOC as and when
additional demand for housing loans arises.
INDIVIDUAL LOANS UNDER THE LOC
The maximum individual loan per employee is 80% to 90% of the cost of the
dwelling unit subject to a maximum of Rs. 30 lacs. The amount of loan available
for borrowers is the amount recommended by the company and as determined by
PNBHF.
RATE OF INTEREST
The company is requested to confirm our current applicable rate of interest. Interest
is calculated on the basis of annual rests. PNBHF reserves the right to vary the rate
of interest at any time in response to changes in money market conditions or if a
levy, tax on interest or any other charge or burden is imposed or levied by any
Government Authority.
FEES AND CHARGES
(a) Processing and administrative fee is 1.5% of the LOC applied for and is payable
at the time of submission of the application.
(b) A commitment charge of 1% per annum on the undrawn amount of the LOC
sanctioned is payable commencing six months from the date of acceptance of offer.
(c) On prepayment of the loan, in part or fun, PNBHF might charge an early
redemption charge of 2 % of the amount being prepaid.
LOAN REPAYMENT
The company shall deduct the Equated Monthly Instalments (EMls) from the
monthly salary of each of the employee borrowers and remit a consolidated
cheque/draft of EMls comprising principal and interest. Pending final disbursement
ofloan, interest on the disbursed portion of the loan caned Pre-EMI interest is
payable every month from the date of each disbursement upto the date of
commencement of EM!. The details on security, disbursement, repayment terms
and commencement of repayment are given under respective types of LOC.
TYPES OF LOC
Our company offers LOC under the following two schemes:
LOC TO
Under this scheme funds are provided to
the company for onward lending to its
employees.The security for the loan is
mortgage of dwelling units financed

_ LOC THRU
Under the scheme loans are sanctioned
to individual employees nominated by
a company with the company
guaranteeing the loans. The security for

and/or any other security as acceptable

to PNBHF, including bank guarantee.
Since the company is the borrower and
the employees of the company obtain
loans from the company, the LOC is a
direct liability of the company.

the loan is a guarantee from the

company and mortgage of dwelling
units financed. Individual employees
recommended by a company are the
borrowers. Therefore, the company has
a contingent liability to the extent of
the guarantee provided.

LINE OF CREDIT TO
Loan application can be made by a company which has an approved HBA
scheme and is engaged in any business except in real estate promotion
and development.
a) Period
The terms of the LOC would be subject to the weighted average
repayment terms offered by the company under its housing loan scheme
for employees covered under this facility subject to a maximum term of
15 years.
b) Security
The main security is mortgage of the dwelling units financed. Our
company can also ask for a bank guarantee and/ or any other security as
may be mutually acceptable. The title deeds may be held either by
PNBHF or by the borrower company on behalf of PNBHF.
c) Disbursement
Disbursement will be made to the company on the basis of a statement indicating
periodic disbursements of housing loans made.

d) Repayment
A company availing of an LOC would start paying Equated Monthly Insta1ments
in the month following the month in which final disbursement of the LOC is made
to the company. Pending final disbursement, the company is required to pay
interest on the disbursed portion of loan, called Pre-EMI interest and is payable
every month from the date of each disbursement up to the date of commencement
of EMI. In the event of an employee's superannuation, resignation, discharge from
services or death, the amount of the housing loan outstanding in his account shall
immediately be repaid by the company to PNBHF.

LINES OF CREDIT THRU

As stated in the foregoing paragraphs, loans will be sanctioned to
individual employees nominated by the company.

(a) Period
The loans availed under this scheme will be repaid in over a maximum period of
20 years or up to the age of retirement of the employees, \whichever is earlier.
(b) Security
The LOC will be secured by mortgage of the dwelling units financed. The
mortgage will be created by the deposit of the title deeds. The title deeds will be
held by PNBHF. The repayment of the loan will also be guaranteed by the
company. The Corporate Body will therefore have a contingent liability to the
extent of the guarantee provided. The loan agreement shall be executed by the
employee borrower and countersigned by the employer guaranteeing repayment.
PNBHF might ask the employer company to provide any other security and
execute any other documents as required in this behalf.
(c) Disbursements
Disbursements to individuals under this facility will be made on the basis of
the recommendation made by the company.
(d) Repayment
The employer shall deduct loan installments from the employees salary and
remit to PNBHF on a monthly basis. EMIs for individual employees would
commence from the month following the month in which the loan is fully
disbursed. Pending final disbursement, the individual is required to pay interest
on the disbursed portion of the loan called Pre-EMI interest which is payable
every month from the date of each disbursement up to date of commencement of
EMI.

RESEARCH
METHODOLOGY

INTRODUCTION
The procedure adopted for conducting the research requires a lot of attention as it
has direct bearing on accuracy, reliability and adequacy of results obtained. It is
due to this reason that research methodology, which we used at the time of
conducting the research, needs to be elaborated upon. Research Methodology is a
way to systematically study & solve the research problems. If a researcher wants to
claim his study as a good study, he must clearly state the methodology adopted in
conducting the research so that it may be judged by the reader whether the
methodology of work done is sound or not.

The research method here includes:-

1.
2.
3.
4.
5.
6.
7.

Meaning of research
Research problem
Research design
Sampling design
Data coIlection method
Data analysis and interpretation
Recommendations

Meaning of Research
Research is defined as "a scientific & systematic search for pertinent information
on a specific topic. Research is an art of scientific investigation. Research is a
systematized effort to gain new knowledge. It is a careful investigation or inquiry
especially through search for new facts in any branch of knowledge.
Research is an academic activity and this term should be used in a technical sense.
Research corn prices defining and redefining problems, formulating hypothesis or
suggested solutions; making deductions and reaching conclusions to determine
whether they fit the formulating hypothesis. Research is thus, an original
contribution to the existing stock of knowledge making for this advancement. The
search for knowledge through objective and systematic method of finding solution
to a problem is research.

Research Problem
The first step while conducting research is careful definition of research problem.
Research design
A research design is the arrangement of conditions for collection and analysis of
data in a manner that aims to combine relevance to the research purpose with
economy in procedure. Research design is the conceptual structure within which
research is conducted. It constitutes the blue print for the collection measurement
and analysis of data. Research design includes an outline of what the researcher
will do from writing the hypothesis and its operational implications to the final
analysis of data.
A research design is a framework for the study and used as a guide in collecting
and analyzing the data. It is a strategy specifying which approach will be used for
gathering and analyzing the data. It also includes the time and cost budget since
most studies are done under these two constraints.
Research design can be categorized as:

Exploratory research
Descriptive
Diagnostic research
Experimental research

Sampling Design
Sampling is necessary because it is almost impossible to examine the entire parent
population (i.e. the entire universe) various factors such as time available, cost,
purpose of study etc make it necessary for the researchers to choose a sample. It
should neither be too small nor too big. It should be manageable.

Data Collection Method

After the sample has been taken the type of information to be sought was decided
upon, the next step is to collect the data. As the data collected is to be the base of
what we plan to find out, the relevant care should be taken that the errors in
methods of collection of data involved are minimized. The factors of availability of
time, cost and human involvement come to effect the reliability of the data
collected. Broadly there are two types of data:

Primary data
Secondary data

Secondary data means the statistics not gathered for the immediate study at hand
but for some other data. It is the data collected by some one for purposes other than
solving the problem being investigated. On the other hand primary data are
generated in a study specifically designed to accommodate the data needs of the
problem at hand.

ANALYSIS AND INTERPRETATION OF DATA AND

RECOMMENDATIONS
The data collected in the aforesaid manner have been tabulated in condensed form
to draw the meaningful result. The different techniques are adopted to analyze a
data.
All the data and the material is arranged through internal resources and the last part
of the project consist of the conclusions drawn from the report, a brief summary
and recommendations and giving the final touch to the reports by stating a
conclusion.

COMPARATIVE
CUSTOMER

PREFERENCE
ANALYSIS
IN HOME LOAN
SECTOR

The title of this report is "COMPARATIVE CUSTOMER PREFERENCE

ANALYSIS IN HOME LOAN SECTOR". The subject was chosen to gather
information about the perception of people towards home loan / sector.
Marketing is essential for each and every organization for its successful operation.
It forms the basis of all other functions.
Marketing is human activity directed at satisfying needs and wants through
exchange processes.
Therefore marketing is a social and managerial process by which individuals and
groups obtain what they need and want through creating, offering and exchanging
products of value with others is an act or operation or service by which original

project and the final consumers are linked together in between these two points i.e.
producer and consumer. Hence every activity facilitating the movement of goods
and services, including market and marketing research are covered under the term
marketing.
Marketing of a product involves a variety of activities of which selling is merely
one of them.
This project provided the important data regarding the demand and awareness of
ICICI Banking home loan sector.

SAMPLE SELECTION
The universe of the study as mentioned below in scope of the project is kept to the
people in Delhi city.
The sample size was chosen to be 100.
Sample was chosen based on Convenience method of sampling but all care was
taken to make it more representative by including people of different occupation.
SCOPE OF THE STUDY

The present study was conducted by the researcher in Delhi covering some main
and popular markets of Delhi because of constraints of time and money study could
not be extended to other cities. As Delhi being a popular and among the good cities
of India is a good market of financial products & also here customers of different
classes like business segment, service segment, and professional segment are in
excess. Since the report aims at finding the potential for financial products at Delhi
itself taking into consideration certain limits and problems, the area was chosen on
the basis of coverage of product no. of respondents.
DELHI MARKET SEGMENT
The market of Delhi mainly comprises of the rural & urban people with population
of around 15 million. The literacy rate is fairly high and there are around 65%
males & 35% females.
This data clearly indicates the emergency of a middle class at Delhi. As is
elsewhere, this class is the harbors of modern facilities. Apart from other
contribution, it is this class for its money. These demands exhibits a vigilant
customer & financial products have been on their toes to return them to pay the
least if not attract the other ones.
Besides Delhi also boasts of a large financial market. It has an upcoming pharmacy
distribution network & lots of Govt. institutions. There is increasing use of Cyber
Cafe Internet & cable connection. The market size of the city is around 2 lacks, a
significant chunk of which is occupied by the upcoming middle classes.
Besides, there is good number of industries.
Apart from this, there are many management and engineering conege's and
universities. The much roaming growth of such institutions shows the presence of
many high nets worth individual is Delhi.
For the purpose of the study the respondents were selected from all corners of
Delhi mainly popular colonies and for gathering information about the trends,
demands & brands available in financial products.
The data was collected through questionnaires. The question consisted of 10
questions along with the information regarding the occupation of the respondent.
The number of respondents were kept to 100. The graphs of all the findings
question wise are given below along with the tables of the data collected.

The question wise findings alee presented next

AWARENESS ABOUT HOME LOANS

Awareness about home loans

Yes
No

Percentage
92
8

INTERPRETATION

The above Pie chart depicts that 92% of total sample size is aware about the home
loans and only 8% are unaware.

EASE OF GETTING HOME LOAN

Ease Of Getting Home Loan

Yes
No

Percentage
51
49

INTERPRETATION
51% of the sample size finds easy to get the home loan while 49% finds it difficult
The ratio is more or less same.

PREFERENCE OF TAKING HOME LOAN

Preference of taking Home Loan

Yes
No

Percentage
76
24

INTERPRETATION
The above graph depicts that maximum percentage of the sample size prefers to go
for home loan.

LOAN RECEIVED

Loan Recieved
Yes
No

Percentage
67
33

INTERPRETATION

It has been found from the graph that 67% of the sample size has gone for the
home loan.

BANK PREFERENCE

PREFERENCE OF BANK
ICICI
PNBHF
LICHF
HDFC
OTHERS

PERCENTAGE
36
18
10
35
1

INTERPRETATION
The above graph depicts that only 18 % of the sample size has preferred to take
home loan from PNB and maximum percentage of the sample size preferred to take
home loan either from ICICI or HDFC and very few that is only one percent has
the preference of other financial institutes.

PROVISION OF OPTIMAL/ECONOMICAL INTEREST RATE

Provision Of Optimal/Economical
Interest Rate
ICICI
PNBHF
LICHF
HDFC
OTHERS

Percentage
32
24
13
27
4

INTERPRETATION
The above graph shows that according to the 32 percentage of total sample size,
ICICI provides the optimal/economical interest rate. The next preference is given
to HDFC and PNBHFL has received the third preference for providing the optimal
interest rate. And only 13 percent of the sample preferred LICHF.

SUITABLE EMI

Preference of bank in case of

suitability of EMI
ICICI
PNBHF
LICHF
HDFC
OTHERS

Percentage
32
24
13
27
4

INTERPRETATION
The above graph shows that according to the 32 percentage of total sample size,
ICICI provides suitable EMI. The next preference is given to HDFC and PNBHFL
has received the third preference for providing suitable EMI. And only 13 percent
of the sample preferred LICHF.

LONG TERM PREFERENCE

Long Term Preference

ICICI
PNBHF
LICHF
HDFC
OTHERS

Percentage
27
24
25
20
4

INTERPRETATION
The above pie chart depicts that maximum number of people has preferred ICICI
bank for long term loans and only 24 percent of sample size has given preference
to PNBHF and only 4% has given preference to other financial institutes.

CUSTOMER FRIENDLINESS

Customer Friendliness
ICICI
PNBHF
LICHF
HDFC
OTHERS

Percentage
26
18
24
17
15

INTERPRETATION
The above pie chart shows that maximum number of people finds ICICI more
customer friendly than other banks.

PROMPT SERVICE

Prompt Service

Percentage
45
13
23
14
5

ICICI
PNBHF
LICHF
HDFC
OTHERS

INTERPRETATION
ICICI bank has found to be quickest in sanctioning the loan among
other financial institutes by maximum number of people.

POSITIVE ASPECT FOR SUCCESS OF PNBHF

Positive Aspect For Success Of

PNBHF
SALES PROMOTION & BRAND
Customer Friendly Home Loan
Schemes
Easy Sanctioning Of The Home
Loans
Lower Interest Rates
Lower Emi's

Percentage
25
35
10
15
15

INTERPRETATION

The above graph depicts that customer friendly home loan schemes are the main
aspect for the success of PNBHF.

LAGGING AREA

Lagging Area
Confined Only In Urban Areas
Non Effective Advertisements
Delay In Processing

Percentage
12
78
10

INTERPRETATION

The above Pie chart shows that Non effective Advertisement is the lagging area of
PNBHFL in comparison to other home loan banks.

CONCLUSION
AND
SWOT
ANALYSIS
AND LIMITATIONS

SWOT ANALYSIS
STRENGTHS

Brand name of Punjab National Bank (PNB) is established over the years.
Single window clearance - a single employee provides wide variety of
facilities to the borrower, minimizing the hassle of wastage of time.

Appraisal techniques are used.

Specialized software's are big assets.
There is no penalty for prepayment from borrowers own service.

WEAKNESSES

High interest rates as compared to other housing finance institutions.

Top management takes large amount of time to approve high value
seeking loan borrowers. No publicity.
No marketing managers work, only through dsa's (direct sales agent).
People are not aware of wide variety of schemes offered by the company;
tend to think the company as only providing home loans.
There is the shortage of staff at almost all branches which does not ensure
easy addressable of the customers problems.

Delegation of authority and responsibility is not proper.

OPPORTUNITIES

Special rates of interest are offered during exhibitions.

Special rates of interest can be introduced for employees of PSU'S &
reputed national or multinational companies'
Product life cycle is to be reviewed.
The growing category of the builders ensure that good, high value
& qualitative projects, providing them home loans with the new and
innovative schemes can lead to over all development of the company.
THREATS

The competition in market is very high due to the private players.

The rates of interest of other players are quite low.
Innovative schemes with horne loan from other players.
The processing process is quite slow which leads to low housing finance.

A fraud case involving 32 cases worth Rs.3 crores at the one branch of
PNB Housing Finance Limited in year 2002 leads decreasing brand name.

LIMITATIONS OF THE STUDY

There are always present some limitations under which researcher has to work.
Here following are some limitations under researcher had to work:
SAMPLE SIZE

The sample size surveyed was limited over 100 respondents which not may be
fully representative of the universe. A large sample size could not be taken due to
time & cost constraints.
NON - COVERAGE OF CERTAIN ASPECTS
There is wide range of perimeters affecting consumer behavior but only a few
questions relating to those determinants have been endorsed in schedule.
TIME CONSTRAINT
We had limited time for conducting this survey report. In this short period of all
the respondents had to be personally contacted for the purpose of survey & then
their responses had to be analysed . So, some shortfalls may be present.
LIMITATIONS OF SAMPLING TECHNIQUES
Limitations & biasness of convenience & judgment sampling used in the present
study to some extent.
MONEY
Available with the researcher also imposed a limitation on the comprehensive of
this research.

APPENDIX

QUESTIONNAIRE

DEAR RESPONDANT,

AS A PART OF BBA (B&I) CURRICULUM, I AM CONDUCTING A STUDY

ON "COMPARATIVE CUSTOMER PREFERENCE IN PUBLIC AND
PRIVATE SECTOR: HOME LOANS". YOU ARE REQUESTED TO PLEASE
COOPERATE BY PROVIDING RELEVANT INFORMATION. I ASSURE YOU
THAT INFORMATION WILL KEPT CONFIDENTIAL AND WILL BE USED
FOR STUDY PURPOSE ONLY.
THANK YOU
YOURS FAITHFULLY
PRIYANKA GUPTA

Q.1 DO YOU FIND EASY TO GET HOME LOANS?

YES
NO
Q.2 DO YOU PREFER TO GO FOR A HOME LOAN ?
YES
NO
Q-3 HAVE U EVER TAKEN A HOME LOAN?
IF YES FROM WHERE
YES
NO
Q.4 RANKS THE FOLLOWING BANKS, DEALING IN HOME LOANS
ACCORDING TO YOUR PREFERENCES.
I.C.I.C.I
PUNJAB NATIONAL BANK HOUSING FINANCE LIMITED. (PNBHFL)
HDFC
LIFE INSURANCE IN INDIA HOSING FINANCE
OTHERS
Q.5 ACCORDING TO YOU WHICH OF THE FOLLOWING BANKS PROVIDES
OPTIMAL /ECONOMICAL INTEREST RATE?
ICICI PNBHFL
HDFC
LICHJ

OTHERS
Q.6 IN THE CASE OF SUITABILITY OF EMI, WHICH BANK WOULD YOU
PREFER?
ICICI
PNBHFL
HDFC
LICHF
OTHERS
Q-7 IN CASE OF LONG TERM WHICH BANK WOULD YOU PREFER?
ICICI
PNBHFL
HDFC
LICHF
OTHERS
Q.8 IN CASE OF CUSTOMER FRIENDLINESS, WHICH BANK WOULD YOU
PREFER?
ICICI
PNBHFL
HDFC
LICHF
OTHERS

Q.9 IN TERMS OF SANCTIONING OF THE HOME LOAN, ACCORDING TO YOU

WHICH BANK IS QUICKER?
ICICI
PNBHFL
HDFC
LICHF
OTHERS
Q.10 ACCORDING TO YOU, WHICH POSITIVE ASPECT IS PLAYING MORE
SIGNIFICANT ROLE IN SUCCESS OFPNBHFL?
SALES PROMOTION & BRAND
CUSTOMER FRIENDLY HOME LOANS SCHEMES
LOWER INTEREST RATES

LOWER EMI'S
EASY SANCTIONING OF THE HOME LOAN
Q.11 IN COMPARISON TO OTHER HOME LOAN BANK ACCORDING TO YOU
PNBHFL IS LAGGING IN WHICH PARTICULAR AREA.
CONFINED ONLY URBAN AREAS
UNEFFECTIVE ADVERTISEMENT
DELAY IN PROCESSING

BIBLIOGRAPHY

www.pnbindia.com

www.pnbhfl.com
www.google.com
www.nhb.org.in
www.indiainfoline.com