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A THESIS

ON

A study on documentation procedures followed at HDFC bank in


offering business loans to Industries at Guntur

SUBMITTED BY
P. LAKSHMI PRASANNA
ENROL.NO. 7NBGU032
INTRODUCTION:

• The money which is required for day to day activities of a Business is called as working
capital. The formula for working capital is current assets – current liabilities.

• Working capital measures how much in liquid assets a company has available to build its
business. In general, companies that have a lot of working capital will be more successful
since they can expand and improve their operations.

• Working capital management involves not only managing the different components of current
assets, but also managing the current liabilities.

• The basic objective of working capital is to provide adequate support for the smooth
functioning of the normal business operations of a company.
OBJECTIVES:

• To understand the process of loan sanction at HDFC Bank

• To know what are the problems facing by a banker while processing loan.

• To know the rules and regulations formed by the bank towards financing the current assets.

• To know how the bank people will estimate the credit worthiness of the customers.
QUESTIONNAIRE:

1.What is the procedure followed by HDFC Bank


(a) Registration certificate (b) partner shipment documents
(c) property documents (d) all of the above

2. Based on what factors will grant the working capital loans


(a)Collateral (b) sales (c) MIB (d) repayment

3. What is the time period to sanction loan


(a)1 week (b) 1 month (c) 3 months

4.What is the special in your loans


(a)Fast sanction (b) low interest rate (c) service

5. What type of follow up that constitutes credit monitoring in HDFC Bank


(a)Financial follow up (b) physical follow up (c) legal follow up

6. What are the steps do you take when customers are failed to repay the loan
(a) refer to collection department (b) issue of legal notice
(c) approach to customers (d) inform to guarantees
DATA ANALYSIS:

Based on this factors Bank providing the working capital loans

• Money in Business
• Collateral
• Sales
• Repayment period

Factors

MIB
35% collateral
30%

sales
Repayment
20%
period
15%
The services offered by HDFC Bank for sanction the loan

• Fast sanction
• Low interest rates
• Easy process
• After sales service

ChartTitle
40
30
20
10
0
Fast sanction low interest easyprocess after sales
rate service

services Column1 Column2


The follow up that are constitute credit monitoring in HDFC Bank

• Financial follow up
• Physical follow up
• Legal follow up

creditmonitoring
Legal
followup 0%
Physical 5%
5%

Financial
90%
The time taken by the Bank when sanction the loan is

• 7 working days
• 1 month
• 2 months
FINDINGS:

• HDFC Bank is following well documentation procedure to sanction the loan.

• They sanction the loan with in a 7 working days.

• After sanctioning the loan they provide better services to their customers.

• The bank people following procedure are very difficult but it makes the banker to get the right
person for the loan.

• HDFC Bank customers are very much aware about working capital loans.
SUGGESTIONS:

• The bank should follow quick disbursal of credit.

• Instead of talking of working capital the bank should provide loan within 2 working days.
Because the entrepreneurs may need working capital for emergency purpose.

• The bank should create knowledge through seminars, workshops to the business man.

• The bank should treat each and every business people on equal basis.

• The HDFC following different Prime Lending Rates, it should fix to a certain rate of interest.
CONCLUSION:

• My study regarding documentation procedure followed at HDFC


Bank given me very good knowledge regarding the procedural
activities followed at HDFC Bank. The entire duration I spent on
learning the prospects of the bank for issuing of loans. This thesis
enhanced my capacity of understanding of banking services at the
same time the other side of my personal work that is the needs of
working capital by the small and medium entrepreneurs.
THANK YOU