PROJECT REPORT

ON
BANKER – CUSTOMER RELATIONSHIP
Through Products & Services Offered

STUDY CONDUCTED AT:

PUNJAB & SIND BANK

(A Govt. Of India Undertaking)
B.O H-Block, Connaught Circus,
New Delhi- 110001

Submitted to:
GURU NANAK DEV UNIVERSITY,
Amritsar, Punjab

Submitted by:
Ms. USHMEET KAUR

Guru Arjun Dev Institute of Management & Information

Technology
Phushpanjali Enclave, New Delhi
 H-Block, Connaught Circus,
New Delhi-110001
Dated:

TO WHOMSOEVER IT MAY CONCERN

This is to certify that Ms. Ushmeet Kaur, student of

Guru Arjun Dev Institute of Management & Information
Technology, pursuing MBE course from Guru Nanak Dev
University, Amritsar (Punjab) has undergone On the Job
Training from Punjab & Sind Bank, B.O H-Block,
Connaught Circus, New Delhi for a period of Four
Weeks with effect from July 5, 2010 to July 31, 2010
with complete attendance as per rules.

She took keen interest in studying the Banker –

Customer Relationship through the products & services
offered by the Bank.

Her conduct during the Training was exemplary.

We wish her All the Best in pursuit of her studies and

career.

(Jagir Singh)
Asst. Gen. Manager
 ACKNOWLEDGEMENT

I hereby acknowledge with gratitude the contribution

made and help rendered by my project guide Mr. Jagir
Singh, Asst. Gen. Manager, B.O. H-Block, Punjab & Sind
Bank, where I completed my On the Job Training under
his able guidance and path showing.

My sincere thanks to Mr. Duggal, my revered

coordinator, teacher, guide for the immense help and
guidance rendered by him.

I will fail in my duty if I do not mention the immense

support and help rendered by some staff members of
PSB, B.O. H-Block, namely, Mr. Harsh Sehgal, Mr. Puri,
Mrs Premlata, Mr. Bhatia, Mr. Girdhar and many more.

Ushmeet Kaur
 TABLE OF CONTENTS

1. Introduction

2. Overview of PSB

• Background,
• Position of the Bank,
• Vision & Mission

3. Objectives & Methodology

4. Rights As A Customer of PSB

5. Common Practices Followed by the Bank

6. PSB – Area of Banker – Customer Relationship

• Deposits
• Loans & Advances
• Services
• RTGS

7. Findings & Recommendations

8. Bibliography
 INTRODUCTION

Banker customer relationship, is just a special contract where a person

entrusts valuable items with another person with an intention that such
items shall be retrieved on demand from the keeper by the person who
so entrust.

Thus the banker is the one who is entrusted with the above mentioned
valuable items, while the person who entrust the items with a view to
retrieving it on demand is called the customer.

In my project, I have attempted to study the Banker – Customer

Relationship through the products and services offered by Punjab &
Sind Bank.
 OVERVIEW
OF
PUNJAB & SIND BANK
Background

Founded in 1908, Punjab and Sind Bank started its operations with the
objective of enhancing the standard of living of the poor people. The bank
has gradually grown into a financial giant with 918 branches and 61 ATMs
throughout the country.

The founders of Punjab and Sind Bank were visionaries like Sir Sunder Singh
Majitha, Bhai Vir Singh and Sardar Tarlochan Singh. The bank is committed
to assist the economically weaker segment of the society and has made
significant achievements regarding this commitment.

Currently, the Chairman & Managing Director of the bank is Sardar G.S.
Vedi.

Position of Bank

The total Deposits of the Bank stood at Rs. 491550856 Thousands as on

March 31’2010.

The Bank earned a Net Profit of Rs. 5088017 Thousands for the year ended
March 31’2010.

The Bank has 919 branches as on date.

The Total Advances stood at Rs. 326391078 Thousands as on March

31’2010.

The Bank has opened an exclusive Housing Finance Branch in order to cater
the credit need of the house aspirants.

The bank has opened Corporate Office to create new financial products as
per the needs and requirements of customers.

With a firm belief that customer is King, we have a full-fledged customer

service division at Corporate Office as well as Zonal offices to deal with
customer complaints.
Bank has its own Hockey Academy at Jalandhar to groom the youngsters. It
has sponsored 58th National Junior Hockey Championship and the Junior
Hockey Team which has done miracles by winning the prestigious Silver
Medal in the 6th Junior World Cup Hockey Championship at Milton Keyenses,
England.
 VISION & MISSION

Corporate Vision:

We envision to emerge as a strong vibrant Bank through synchronization of

the human, financial and technological resources.

Corporate Mission:
1. To put in place the effective Risk Management and Internal Control
Systems.

2. To adopt and operationalise high-level technology standards.

3. To strive to achieve excellence in Customer Service.

4. To achieve the highest standards of transparency and accountability in

the conduct of banking business.

5. To adopt professional approach in effectively managing financial as

well as non-financial risks.

6. To maximize profitability and profits of the Bank with due compliance of

prudential guidelines.

7. To maximize competitive risk adjusted return on capital, through

planned reduction in the average cost of funds, increased yield on
advances and investments besides reduction in cost of operations.
Branch Network

The corporate office of the bank is situated at Rajendra Place, New Delhi with
19 Zonal Offices (as on 31-07-2010) scattered in various States controlling
the branches.

The bank has vast network of 920 branches and 63 ATMs across India.
Punjab and Sind Bank staffs more than 10,000 employees dedicated to the
banking services and customer care.
 States Number Of Offices
Andhra Pradesh 04
Assam 06
Bihar 06
Chandigarh 22
Chhattisgarh 05
Delhi 113
Goa 01
Gujarat 07
Haryana 50
Himachal Pradesh 11
Jammu & Kashmir 11
Jharkhand 08
Karnataka 05
Kerala 03
Madhya Pradesh 26
Maharashtra 26
Manipur 02
Nagaland 01
Orissa 04
Punjab 404
Rajasthan 22
Tamil Nadu 08
Tripura 01
Uttar Pradesh 129
Uttaranchal 23
West Bengal 22
Total 920
 OBJECTIVES & METHODOLOGY
OF THE PROJECT UNDERTAKEN
Objectives

 To study and analyse the Banker – Customer Relationship through

products and services offered by Punjab & Sind Bank to its customers
and schemes there under.

 To study and analyse actual functioning of Banker – Customer

Relationship in the in H-Block, Connaught Circus, New Delhi Branch.

 To find out the effectiveness of such schemes in the branch.

 To find out the deficiencies and adequacies in the Banker – Customer

Relationship through so offered products and services.

Methodology
While undergoing On the Job Training Programme for 4 (four) Weeks at
PUNJAB & SIND BANK (A Govt. Of India Undertaking), Branch Office, H-Block,
Connaught Place, New Delhi, the study was conducted and analysed on the:

 Products of Bank

 Schemes there under

 Methodology adopted by the bank in serving the customers

 Data of the bank was analysed

 Customers of the Bank were contacted to study their awareness of

availability of Bank’s Products & Services and also their expectations
from the Bank and their satisfaction level.
 Your Right as A Customer of Punjab & Sind Bank!

As our valued customer, you enjoy the following rights from our Branches
network through out the country:

TIME SCHEDULE

1. Receipt of Cash 10-15 Minutes

2. Encashment of Cheques 10-15 Minutes

3. Issue of Cheque-Book/DDs/POs 15-20 Minutes

4. Opening of an Account 15-20 Minutes

5. Payment of DDs/POs 10-20 Minutes

6. Payment/Renewal of FDRs 20-25 Minutes

7. Retirement of Bills 20-30 Minutes

8. Updation of Pass Book/ Issue of Account 05-10 Minutes

Statement
9. Statement of Account to be issued regularly On every 5th of the
Month.
10. Collection of Cheques Local : 2-4 days

11. Outstation: 10-14 days

COMMON PRACTICES FOLLOWED BY THE BANK
FOR YOUR CONVENIENCE

1. Display of business hours.

2. Attend to all customers present in the banking hall at the close of

business hours and rendering of courteous service.

3. Provide separate 'Enquiry' or 'May I Help You' at large Branches.

4. Offer nomination facility to all deposit accounts (i.e. account opened in

individual capacity) and all safe deposit hirers (i.e. individual hirers).

5. Display interest rates for various deposit schemes from time to time.

6. Notify change in interest rates on advances.

7. Display of Service Charges on issue of Demand Drafts, Pay Orders,

Duplicate Drafts, Cancellation of Drafts, Collection of Documents, etc.

8. Display Time - Norms for various Banking Transactions.

9. Pay interest for delayed credit of outstation cheques, as advised by

Reserve Bank of India (RBI) from time to time.

10. Display of availability of Locker facility at the Branch.

11. Display of Tax Collection facility at the Branch.

12. Accord immediate credit in respect of outstation and local

cheques upto a specified limit subject to certain conditions, as advised
by RBI from time to time.

13. Provide complaint/suggestion box in the Branch premises.

14. Display address of Zonal & Head Offices, as well as Nodal Officer
dealing with customer grievances/complaints.

15. Name and address of the concerned banking ombudsman.

16. Corruption free service to all customers.

17. We have extended business hours in our fully computerized

branches in Delhi.
 PUNJAB & SIND BANK
AREAS OF BANKER-CUSTOMER
RELATIONSHIP
Where service is the way of life...

Punjab and Sind Bank has an array of services to fulfil various

needs of the customers. The innovative products and services
of the bank are listed below:
DEPOSITS
1) Savings Deposits Account

A deposit account held at a bank or other financial institution that provides

principal security and a modest interest rate. Savings account funds are
considered one of the most liquid investments outside of demand accounts
and cash. Savings accounts are generally for money that you don't intend to
use for daily expenses. To open a savings account, simply go down to your
local bank with proper identification and ask to open an account. Punjab &
Sind Bank offers 3.5% interest rate to the customers for deposit in savings
account. It is a form of demand deposit which is subject to restrictions as to
the number of withdrawals as also the amounts of withdrawals permitted by
the Bank during any specified period.

1. Saral Savings Scheme

2. Saving Bank account

1. These accounts are designed to help the individuals (personal

customers) to inculcate habit of saving money and to meet their
future requirement of money. The amount can be deposited /
withdrawn from these accounts by way of cheques / withdrawal slips.
The withdrawals are restricted to 50 entries each half-year in the
S.B. Account.

2. Saving Bank accounts are very popular. These accounts can be

opened by eligible person(s) and certain organization(s) / agencies
as approved by the Reserve Bank of India (RBI).

3. As required by law, while opening this account, we satisfy ourselves

about the identity, including verification of address, of a person(s)
seeking to open an account and to assist in protecting our
prospective customer(s) and ourselves against fraud and other
misuses of the banking system.

4. We are required to obtain two recent photographs of the person(s)

opening the account, as per R.B.I. directives.
5. We are required to obtain Permanent Account Number (PAN) or
alternatively obtain declaration in Form No. 60 or 61 as per the
Income Tax Act (vide Section 139 A) from the person(s) opening the
account.
6. We provide to the prospective customers details of the documents
required for identification of the person(s) opening the account in
addition to satisfactory introduction. Documents normally accepted
are the current, gas / telephone / electricity bill / ration card / voter's
identity card / driving license / passport, etc.

7. You are required to maintain certain minimum balance in the

account, as specified by the Bank from time to time, separately for
computerized and non-computerized Branches and also depending
on, whether account holder wants to avail the cheque book facility or
not. Non-compliance of this would attract service charges. Interest at
3½% p.a. is processed rate, as per presently paid on half yearly
basis depending on minimum balance between the 10th day and last
day of the months, provided it works out to minimum Re. 1/-

8. Cheques, dividend warrants drawn in the name of account holder(s)

will only be collected through this account. Financial instruments
endorsed in favour of the account holder(s) will not be collected
through savings bank account.

9. Get your passbook updated on presentation legibly with full entries.

If the number of entries to be made is large, kindly leave the
passbook against receipt showing the date when it can be collected
back. You can obtain the statement of account indicating full details
by 5th of every month in case you have not been issued a passbook.

10. You can obtain a new cheque book when your requisition slip
appears next in the current cheque book.
2) Current Deposits Account

An active account at a bank or building society into which deposits can be

paid and from which withdrawals can be made by cheque (see also cheque
account). Banks make no charges and pay interest on balances maintained
in a current account. a form of demand deposit wherefrom withdrawals are
allowed any number of times depending upon the balance in the account or
up to a particular agreed amount and will also include other deposit accounts
which are neither Savings Deposit nor Term Deposit.

1. Current Accounts can be opened by individuals, partnership firms,

private and public limited companies, HUFs /specified associates,
trusts, etc.

2. As required by law, while opening this account, we satisfy ourselves

about the identity, including verification of address, of a person(s)
seeking to open an account to assist in protecting the right of
customer(s) and ourselves against fraud and other misuses of the
banking system.

3. We also require a satisfactory introduction of the person(s) opening the

account by a person acceptable to the Bank and will require to obtain
two recent photographs of the person(s) opening/operating the
account, as per RBI directives.

4. You are required to give Permanent Account Number (PAN) or

alternatively obtain declaration in Form No. 60 or 61 as per the Income
Tax Act (vide Section 139A) from the person(s) opening the account
(i.e. including partners of Registered/Unregistered partnership as also
Registered / Incorporated bodies / companies).
5. We provide to our prospective customers details of the
documents/required for identification of the person(s) opening the
account in addition to a satisfactory introduction. Documents normally
accepted are the current, gas/telephone/electricity bill/ration
card/voter's identity card/driving licence/passport, etc.
6. Minimum balance as stipulated from time to time is required to be
maintained and no interest is paid on credit balances kept in current
account

7. Services charges are levied for:

Ledger folio used.

Cheque Books issued.
Non-maintenance of minimum balance.
Return of cheques etc.
Other facilities as required by the Current Account Customer.

8. For opening special types of current accounts like for Executors

Administrators, Trustees, Liquidators, etc., the Branch Manager may be
contacted who will help in opening these type of accounts.

9. As per RBI directives, the applicant (i.e. account opener) should declare
in the account opening form or separately that he is not enjoying any
Credit facility with any Bank and if he does enjoy any facility/facilities
he should declare full particulars therefore indicating the name of the
Bank and name of the Branch, wherefrom he has availed these
facilities.
3) Term Deposits Account

A deposit at a bank or other financial institution that has a fixed return

(usually via an interest rate) and a set maturity. That is, the depositor does
not have access to the funds until maturity; in exchange, he/she is usually
entitled to a higher interest rate. One of the most common examples of a
term deposit is a certificate of deposit. It is also called a time deposit. It is
deposit received by the Bank for a fixed period withdrawable only after the
expiry of the fixed period.

1. Fixed Deposit Scheme Ordinary

2. Saving With Smile Deposit Scheme

3. Short Term Deposit Scheme

4. Capital Gain Deposit Scheme

5. Harhi Savni (Rabi Kharif) Jama Yojna

6. PSB Fixed Deposit Tax Saver Scheme

Both senior citizens and Staff/ex-staff members of the bank are going to get
additional benefits and extra interest from the fixed deposit schemes.
1. We have tailored various deposit schemes to suit the needs and
expectations for investing in every walk of life, which are prominently
displayed at our branches for your convenience. We welcome you to
seek more details and shall also be glad to assist in the area of
investment in various deposit schemes vis-a-vis your requirement.

2. Term Deposit accounts can be opened by individuals, partnership firms,

private and public limited companies, HUFs/specified associates, etc.

3. As required by law, while opening this account, we satisfy ourselves

about the identity, including verification of address, of a person(s)
seeking to open an account, to assist in protecting the prospective
customer(s), members of the public and ourselves against fraud and
other misuses of the banking system.

4. We require a satisfactory introduction of the person(s) opening the

account by a person acceptable to the Bank and will obtain two recent
photographs of the person(s) opening the account, as per R.B.I.
directives.

5. We also require to obtain Permanent Account Number (PAN) or

alternatively obtain declaration in Form No. 60 or 61 as per the Income
Tax Act (vide Section 139 A) from the person(s) opening the account.

6. Premature withdrawals are allowed, unless specified otherwise, at the

rate of interest applicable for the period, for which the deposit has run
or the contracted rate whichever is lower, subject to penalty, if any
prescribed by the Bank. No interest will be paid on premature
withdrawals of deposit which has remained with the Bank for less than
15 days. For more details of interest rates, please contact our Branch
Manager.
7. Generally loans/overdrafts against deposits are allowed, except on
Certificates of Deposit (CD). Such loans are sanctioned by charging
interest at rates directed by RBI from time to time or as prescribed by
the Bank and automatic renewal of FDRs are also available. Interest on
overdue deposit is paid, if the deposit is renewed, as decided by the
Bank from time to time

8. Interest on deposits is payable either monthly at discounted value or

quarterly or compounded quarterly (i.e. reinvestment of interest) or on
the date of maturity at the option of the depositor as applicable under
particular deposit scheme.
9. Interest on Bank deposit is exempted from Income Tax upto a limit,
specified by Income Tax authorities from time to time, as per Govt.
Norms.

10. We accept the declaration in Form No. 15 H preferably at the

commencement of the Financial Year for receiving interest on deposits
without deduction of tax.

11. We issue TDS Certificate for tax deducted, within time schedule
as per law.

12. Transfer of funds on maturity of terms deposits as well as

periodical interest on such deposits to another branch of the Bank is
done at par.
Rate of Interest offered by Punjab & Sind Bank on Term
Deposits:

Time period Amt. less than Rs.15lakhs- 1 Amt. More than

15Lakhs crore Rs.1crore
7 – 14 Days 1% 1% 1%

15 – 30 Days 2% 2% 2%

31 – 45 Days 2% 2% 2%

46 – 59 Days 3% 3% 3%

60 – 90 Days 3% 3.5% 3%

91 – 179 Days 5% 4.5% 4%

180 – 269 Days 5.5% 5% 4.5%

270 – 364 Days 5.75% 5.75% 5.25%

12 – 18 Months 6.5% 6.25% 6%

2 – 3 Years 6.75% 6.75% 6%

3 – 10 Years 7% 7% 6%
 4) Recurring Deposits Account

The Recurring deposit account is an account in the bank (or a Post office
in some countries) where an investor deposits a fixed amount of money
every month for a fixed tenure (mostly ranging from one year to five
years). This scheme is meant for investors who want to deposit a fixed
amount every month, in order to get a lump sum after some years. The
small monthly savings in the Recurring Deposit scheme enable the
depositor to accumulate a handsome amount on maturity. Interest at term
deposit rates is computable on quarterly compounded basis.

Who can open an account:

+ An individual, who is not insolvent or insane, can open an account singly

or jointly.

+ A minor can open Saving bank Account and the same can be ope rated
by the natural guardian or by minor himself / herself, if he / she is above
the age of 10 years. The account can also be opened jointly.

+ On attaining majority, the erstwhile minor should confirm the balance in

his / her account and if the account is operated by the natural guardian /
guardian, fresh specimen signature of erstwhile minor duly verified by the
natural guardian / guardian would be obtained and kept on record for all
operational purpose.

+ Such accounts can be opened by Individuals (singly or jointly), a firm,

company, club, Association , Institution, Govt. or Semi Govt. Body, Co-
operative societies, religious and charitable institutions etc.

Minimum deposit in the Account - Minimum of Rs. 10/-

Maximum deposit in the Account- Maximum of any amount per month.

Minimum and Maximum tenure

Minimum tenure - Minimum period six months.
Maximum tenure - Maximum 10 years.

Rate of Interest

+ As per rate applicable to fixed Deposit for the respective maturity

period.

Periodicity of Interest
+ The interest is compounded at quarterly intervals but paid along with
principal at the time of maturity of deposit.
 ACCOUNT OPENING AND OPERATION OF DEPOSIT ACCOUNTS
AND OTHER RELATED SERVICES PROVIDED BY THE BANK

A) The Bank before opening any deposit account will carry out due diligence
as required under "Know Your Customer" (KYC) guidelines issued by RBI and
or such other norms or procedures adopted by the Bank. If the decision to
open an account of a prospective depositor requires clearance at a higher
level, reasons for any delay in opening of the account will be informed to him
and the final decision of the Bank will be conveyed at the earliest to him.

B) The Bank would provide the prospective depositor account opening forms
and other materials. The same will contain details of information to be
furnished and documents to be produced for verification and or for record.
The Bank official opening the account will explain the procedural formalities
and other clarifications sought by the prospective depositor at the time of
opening a deposit account.

C) For deposit products like Savings Bank Account and Current Deposit
Account, the Bank will normally stipulate certain minimum balances to be
maintained as part of terms and conditions governing operation of such
accounts.
Failure to maintain minimum balance in the account will attract levy of
charges as specified by the Bank from time to time. For Saving Bank Account
the Bank may also place restrictions on number of transactions, cash
withdrawals, etc., for given period. Similarly, the Bank may specify charges
for issue of cheques books, ATM & Debit Cards, additional statement of
accounts, duplicate pass book, folio charges, tele-banking services etc. All
such details, regarding terms and conditions for operation of the accounts
and schedule of charges for various services provided will be communicated
to the prospective depositor while opening the account.

D) Savings Bank Accounts can be opened for eligible person / persons and
certain organizations / agencies (as advised by Reserve Bank of India (RBI)
from time to time) Current Accounts can be opened by individuals /
partnership firms / Private and Public Limited Companies / HUFs / Trusts, etc.
Term Deposits Accounts can be opened by individuals / partnership firms /
Private and Public Limited Companies /HUFs / Trusts, etc.

E) While opening a deposit account due diligence will be exercised involving

satisfaction about the identity of the person, verification of address,
satisfying about his occupation and source of income. Obtaining introduction
of the prospective depositor from a person acceptable to the Bank and
obtaining recent photograph of the person/s opening / operating the account
are part of due diligence process.

F) In addition to the due diligence requirements, under KYC norms the Bank
will obtain Permanent Account Number (PAN) or General Index Register (GIR)
Number or alternatively declaration in Form No. 60 or 61 as specified under
the Income Tax Act / Rules.

G) Deposit accounts can be opened by an individual in his own name (status:

known as account in single name) or by more than one individual in their
own names (status: known as Joint Account). A minor can also open savings
Bank account either jointly with natural guardian or with mother as t he
guardian (status: known as Minor's Account). Minors above the age of 14 will
also be allowed to open and operate saving bank account independently.

H) Operation of Joint Account - The Joint Account opened by more than one
individual can be operated by single individual or by more than one
individual jointly. The mandate for operating the account can be modified
with the consent of all account holders. However, only natural guardian can
operate Savings Bank account opened by a minor jointly with natural
guardian / guardian.

I) Any of the following mandates can be given by joint account holders to

dispose of balance in the above accounts:

i. Either or Survivor: If the account is held by two individuals say, A & B, the
final balance along with interest, if applicable, will be paid to survivor on
death of anyone of the account holders.

ii. Anyone or Survivor/s: If the account is held by more than two individuals
say, A, B and C, the final balance along with interest, if applicable, will be
paid to the survivor on death of any two account holders.
The above mandates will become operational/ applicable only on or after the
date of maturity of term deposits. This mandate can be modified by the
consent of all the account holders.

J) The Bank will register mandate / power of attorney given by the depositor
authorizing another person to operate the account on his behalf.

K) The Term Deposit account holders at the time of placing their deposits can
give instructions with regard to closure of deposit account or renewal of
deposit for further period on the date of maturity. Automatic renewal of the
deposit shall be undertaken as per the mandate given in the account
opening form.

L) Nomination facility is available on all deposit accounts opened by the

individuals. Nomination is also available to a sole proprietary concern
account. Nomination can be made in favour of one individual only. The
account holder(s) can cancel or change nomination made by him/them at
any time. The third party is required to witness the process of making
nomination, cancellation or change thereof. Nomination can be modified by
the consent of account holder(s). Nomination can be made in favour of a
minor also.
The bank recommends that all depositors avail nomination facility. In the
event of death of the depositor(s), the nominee would receive the balance
outstanding in the account as a trustee of legal heirs. While opening a
deposit account, the depositor will be informed of the advantages o f the
nomination facility.

M) The Bank will provide a statement of account to Savings Bank as well as

Current Deposit Account Holders periodically as per terms and conditions of
opening of the account. Alternatively, the Bank may issue a Pass Book to
these account holders.

N) The deposit accounts may be transferred to any other branch of the Bank
at the request of the depositor.
 INSURANCE COVER FOR DEPOSITS

All bank deposits are covered under the insurance scheme offered by
Deposit Insurance and Credit Guarantee Corporation of India (DICGC) subject
to certain limits and conditions. The details of the insurance cover in force
will be made available to the depositor.

STOP PAYMENT FACILITY

The Bank with due diligence will accept stop payment instruction from the
depositors in respect of cheques issued by them. Charges, as specified, will
be recovered.

DORMANT ACCOUNTS

The bank may transfer all accounts not operated for a considerable period of
time to a separate dormant / inoperative account status in the interest of the
depositor as well as the bank. The charges, if any, levied by the bank on
dormant / inoperative accounts shall be conveyed to the depositor. The
depositor can formally request the Bank to activate the account for operating
it.

SAFE DEPOSIT LOCKERS

The safe deposit locker facility is not offered at all the branches. However,
wherever the facility is offered allotment of safe deposit vault will be subject
to availability and compliance with other terms and conditions attached to
the service. An individual (being not a minor) may hire safe deposit lockers
singly or jointly with another individual(s), HUF, firms, limited companies,
associates, societies, trusts etc.
Nomination facility is available to individual (s) holding the lockers singly or
jointly. Where the lockers are held in joint names, up to two nominees can be
appointed. Joint locker holders can give mandate for access to the lockers in
the event of death of on e o f the holders on the lines similar to those for
deposit accounts. In the absence of nomination or mandate for disposal of
contents of lockers, with a view to avoid hardship to common persons, the
bank will release the contents of locker to the legal heirs against indemnity
on the lines as applicable to deposit accounts. The lockers shall be available
to the lessees on pre-determined rent depending upon the size of the locker
and location o f branch notified by the bank from time to time in its Service
Charges Schedule. The rentals/service charges o f locker shall be payable in
cash and or debited to the account of the lessee with the bank.
 CAPITAL GAIN SCHEME - THE TAX SAVER SCHEME

Exemption of Capital Gain Tax under Section 54B, 54D, 54F and 54G of I.T.
Act, 1961 is available on amount deposited under Account 'A' (Saving
Deposit) and/or Account 'B' (Term Deposit) with option to keep deposit on
cumulative or non-cumulative basis at Branches.

PAYMENT OF BALANCE IN ACCOUNTS OF THE DECEASED

CUSTOMERS TO SURVIVORS / CLAIMANTS:

As directed by the RBI, we do not insist on succession certificate from legal

heirs in accounts having survivorship / nominee irrespective of amount
involved.

STANDING INSTRUCTIONS

Standing instructions can be given to the Bank for transfer/remittance of

funds from one account to other account(s) maintained in the same Branch,
any other Branch of the bank or any other Bank or any other third party.
LOANS & ADVANCES
 LOANS & ADVANCES

Meaning:
Meaning:

An arrangement in which a lender gives money or property to a borrower

and the borrower agrees to return the property or repay the money, usually
along with interest, at some future point(s) in time. Usually, there is a
predetermined time for repaying a loan, and generally the lender has to bear
the risk that the borrower may not repay a loan (though modern capital
markets have developed many ways of managing this risk). Written or oral
agreement for a temporary transfer of a property (usually cash) from its
owner (the lender) to a borrower who promises to return it according to the
terms of the agreement, usually with interest for its use. If the loan is
repayable on the demand of the lender, it is called a demand loan. If
repayable in equal monthly payments, it is an instalment loan. If repayable in
lump sum on the loan's maturity (expiration) date, it is a time loan. Banks
further classify their loans into other categories such as consumer,
commercial, and industrial loans, construction and mortgage loans, and
secured and unsecured loans. A written promise to repay the loan is called a
promissory note. Sums paid or received before the fulfilment of an
obligation, such as supply of goods or provision of services.

The term ‘loan’ refers to the amount borrowed by one person from another.
The amount is in the nature of loan and refers to the sum paid to the
borrower. Thus, from the view point of borrower, it is ‘borrowing’ and from
the view point of bank, it is ‘lending’. Loan may be regarded as ‘credit’
granted where the money is disbursed and its recovery is made on a later
date. It is a debt for the borrower. While granting loans, credit is given for a
definite purpose and for a predetermined period. Interest is charged on the
loan at agreed rate and intervals of payment. ‘Advance’ on the other hand, is
a ‘credit facility’ granted by the bank. Banks grant advances largely for
short-term purposes, such as purchase of goods traded in and meeting other
short-term trading liabilities. There is a sense of debt in loan, whereas an
advance is a facility being availed of by the borrower. However, like loans,
advances are also to be repaid. Thus a credit facility- repayable in
instalments over a period is termed as loan while a credit facility repayable
within one year may be known as advances. However, in the present lesson
these two terms are used interchangeably.
Utility of Loans and Advances:

Loans and advances granted by commercial banks are highly beneficial to

individuals, firms, companies and industrial concerns. The growth and
diversification of business activities are effected to a large extent through
bank financing. Loans and advances granted by banks help in meeting short-
term and long term financial needs of business enterprises.
We can discuss the role played by banks in the business world by way of
loans and advances as follows:

(a) Loans and advances can be arranged from banks in keeping with the
flexibility in business operations, Traders may borrow money for day to day
financial needs availing of the facility of cash credit, bank overdraft and
discounting of bills. The amount raised as loan may be repaid within a short
period to suit the convenience of the borrower. Thus business may be run
efficiently with borrowed funds from banks for financing its working capital
requirements.

(b) Loans and advances are utilized for making payment of current liabilities,
wage and salaries of employees, and also the tax liability of business.

(c) Loans and advances from banks are found to be ‘economical’ for traders
and businessmen, because banks charge a reasonable rate of interest on
such loans/advances. For loans from money lenders, the rate of interest
charged is very high. The interest charged by commercial banks is regulated
by the Reserve Bank of India.

(d) Banks generally do not interfere with the use, management and control
of the borrowed money. But it takes care to ensure that the money lent is
used only for business purposes.

(e) Bank loans and advances are found to be convenient as far as its
repayment is concerned. This facilitates planning for future and timely
repayment of loans. Otherwise business activities would have come to a halt.

(f) Loans and advances by banks generally carry element of secrecy with it.
Banks are duty-bound to maintain secrecy of their transactions with the
customers. This enhances people’s faith in the banking system.
There are Two Types of Loan Available from Banks:

(a) Demand loan

(b) Term loan

Demand Loans:

A loan which is repayable on demand by the bank is called Demand Loan. In

other words, it is repayable at short-notice. The entire amount of demand
loan is disbursed at one time and the borrower has to pay interest on it. The
borrower can repay the loan either in lump sum (one time) or as agreed with
the bank. For example, if it is so agreed the amount of loan may be repaid in
suitable instalments. Such loans are normally granted by banks against
security. The security may include materials or goods in stock, shares of
companies or any other asset. Demand loans are raised normally for working
capital purposes, like purchase of raw materials, making payment of short-
term liabilities.

Term Loans:

Medium and long term loans are called Term Loans. Term loans are granted
for more than a year and repayment of such loans is spread over a longer
period. The repayment is generally made in suitable instalments of a fixed
amount. Term loan is required for the purpose of starting a new business
activity, renovation, modernization, expansion/ extension of existing units,
purchase of plant and machinery, purchase of land for setting up of a
factory, construction of factory building or purchase of other immovable
assets. These loans are generally secured against the mortgage of land,
plant and machinery, building and the like.
 IMPORTANT LOAN SCHEMES OF THE BANK

1. Credit Facilities for Agriculturists:

There are number of credit schemes for farmers which are liberally available
to our rural and semi urban branches. The Bank has very attractive Kisan
Credit Card Scheme for meeting the credit needs of the farmers with
provision of personal accident insurance coverage of KCC holders.
The Bank has introduced a unique P&S Bank Diamond Krishi Card (DKC)
Scheme to provide more credit and better facilities to A Class farmers.
For tractor financing Bank has made TIE-UP arrangement with Punjab
Tractor, Eicher Tractor, Bajaj Tempo and Escorts whereby borrower gets
incentives.

Besides, there are schemes for:

o Purchase of agriculture land for small, marginal borrowers and agricultural

labourers.

o Purchase of new/old tractors, farm machinery.

o Composite loan scheme Kheti Udyog Khazana Yojana.

o Purchase of Harvester Combine.

o Purchase of Two Wheelers by the farmers.

Bank has introduced a Joint Mortgage deed for the convenience of farmers to
facilitate availment of agriculture loans without having to execute the deed
every now and then.

2. Small Scale Industries:

We extend credit to SSI for meeting financial requirements for purchase of

machinery and equipment, for construction of building, for working capital
requirements. There is provision of collateral free credit upto Rs. 25.0 lac to
SSI units which are covered under credit guarantee fund trust scheme.
Upfront Guarantee fee under this scheme is borne by the bank for credit
facilities up to Rs. 2.0 lac.

3. LUCC/KVIC Scheme:

The bank encourages landing under KVIC Scheme and other Govt. sponsored
schemes. We have introduced LAGHU UDYAMI CREDIT CARD SCHEME (LUCC)
for working capital loan upto Rs. 10.0 lac to our existing eligible borrowers
under SSI, Retail Trade and small business/Self employed persons under
priority sector.
4. ACC Scheme:

Under Artisans credit card scheme hassle free credit facility upto Rs. 2.0 lac
is provided to artisans for their investments needs as well as working capital
requirement.

5. Housing Finance:

We have very liberal policy for housing finance to the members of the public.
Special Scheme have been floated for Govt./PSU employees, Professional
and self employed persons, as also for general public for construction,
purchase and renovation/repair of houses/flats. For Govt./PSU employees no
processing charges are taken.

6. Car Loan:

Under this scheme a borrower can get a loan to buy a car on very attractive
terms for personal use. An individual can club his/her income with that of
his/her spouse to avail higher loans. Minimum formalities, simple paperwork
and effortless procedure are the main attraction of this scheme.

7. Professional Loan:

A loan for professional like Doctors, Engineers, Chartered Accountants,

Lawyers, Architects, etc., to meet their professional needs is given. One can
avail loan for purchase of all types of medical equipments, machineries,
items to start clinics, acquiring or renovating business premises, air
conditioners, generators, refrigerators, computers, etc.

8. Educational Loan:

To encourage the youth in attaining expertise in educational and

professional fields, our bank is making available finance upto Rs. 7.50 lac for
studies in India and upto Rs. 15.0 lac abroad. Bank has formulated a revised
education loan policy whereby education loans upto Rs. 7.50 lac are granted
without collaterals and with third party guarantee only. For education loan
upto Rs. 4.0 lac rate of interest is charged @11.0% p.a. and no margin is
required.

9. Loan against own Deposit/Govt. Securities:

We offer loan against bank's own deposit and Govt. Securities like NSCs,
IVP/KVC, etc., for personal use or business purpose. A margin of 25% is to be
maintained on the principal investment.
10. Personal Clean Loan Facility:

We offer personal clean loan facility to officials of Govt. and Public sector
undertaking, local bodies, reorganised universities and schools run by
Govt./Local bodies with confirmed service of at least 5 years. The loan
amount ranging from Rs. 50000/- to Rs. 1.0 lac can be availed for purchase
of consumer durables or for any consumption/personal use or purchase of
vehicle, etc.

11. Clean Loan Scheme for Retired Personnel/Pensioners:

Who have retired from Central/State Govt. or any PSU and should be drawing
his/her pension through our bank. The age of pensioners should not exceed
70 years at the time of applying of loan. The loan upto 10 times the monthly
pension subject to maximum of Rs. 1.0 lac can be granted for any personal
need without collateral. However, guarantee of the family pension nominee
or major son of a third party acceptable to the bank is to be obtained.

12. ODP Scheme for Traders/Retailers:

Under this scheme credit is available to traders/retail traders who are in

business for at least 5 years. The loan/limit to the extent of 50% of the
property offered as security subject to a maximum of Rs. 15.0 lac. No stock
statement/No bills required by the bank.

13. Loan against Rent Receivables:

We offer this scheme to land lords/owners of commercial, residential

property who have rented their premises to Govt. Deptt./PSUs/Pvt. Ltd.
Cos./MNCs/Embassy or any other organization of repute. Loan to the extent
of 80% of rent receivable during the period of tenancy or 60 months
whichever is lower, less income tax payable and any other local
tax/maintenance charges to be paid by tenants. Amount of credit should not
exceed 40% of the market value of the property to be mortgaged.

14. ODP Scheme for Contractors:

Who are registered and are income tax payee, having minimum three years
of experience in his business (Contractorship), credit upto Rs. 25.0 lac can be
extended subject to a maximum of 50% of the value of contracts in hand
against the mortgage of property valuing at least double the amount of ODP
Limit.
15. Festival Loan Scheme:

Under festival loan scheme clean loans are granted upto Rs. 1.0 lac to meet
special expenditure for festival celebration such as furnishing of
house/shop/office, consumer goods, personal expenditure.

16. Udyogini Scheme:

Under udyogini scheme credit facilities are granted to women entrepreneurs

to avail the loans on liberal terms and exclusive catering of credit under
direct agriculture activities. Tiny SSI sector, business enterprises, Retail
traders, Professional and self employed, etc.

17. Club Loan Scheme:

Under club loan scheme employees of reputed clubs in metropolitan/urban

centres are granted credit facility for purchase of consumer items/for
personal use.
Further loan applications of Education, Housing, Agriculture, SHGs, SSI have
been simplified and revised for the benefits of borrowers.

18. Golden Jubilee Rural Housing Scheme (GJRHS):

Under this scheme, borrower residing in rural/semi urban areas can avail
loan (i) upto Rs. 5 lac for construction of new house and (ii) Rs. 3 lac for
repair/upgradation of existing house (iii) Maximum period for repayment is
15 years against mortgage of property or other security such as LIC Policy,
Govt. Promissiory Note, share/debentures, gold ornaments or any other
security.

19. Swarnjayanti Shahri Rozgar Yojana (SJSRY):

To be eligible under this scheme (i) a person with an annual family income of
less than Rs. 11859/ as per 1991-92 prices and (ii) should not be defaulter to
any nationalized bank & financial institution/Co-op. Bank. The loan is given
for any town services requiring special skills. Maximum unit cost Rs. 50000/-.
20. Swaranjayanti Gram Swarozgar Yojana (SGSY):

Under this scheme, the persons below the BPL level such as rural poor land,
land less educated unemployment, rural artisans, disabled handicapped,
SHGs consisting of 10 to 20 members can be benefited. The amount of loan
is given as per cost prescribed by NABARD. Repayment of loan in 5 to 9
years.

21. Prime Minister Rozgar Yojana (PMRY):

The objective of the scheme is to provide sustained employment to educated

unemployed urban youth in micro enterprises. These enterprises will cover
manufacturing, service & business ventures. The borrower age should be 18
to 35 years and for SC/ST/OBC/Women/Ex-serviceman/Physically
handicapped/disabled Maximum age 45 years. Loan can be given upto Rs. 1
lac for business and Rs. 2 lac for manufacturing industry. In case of group
maximum Rs. 10 lacs (each member should be individually eligible). The
repayment period is 3 to 7 years. Govt. subsidy in the project is limited to
maximum 15%.

22. Differential Rate of Interest (DRI) Scheme:

This scheme is to assist poorest of the poor so as to bring them above BPL.
The eligibility criterion for allowing loan is as under:

(i) Individual whose family income does not exceeds Rs. 6400/- P.A. in rural
areas and Rs. 7200/- p.a. in semi urban areas.

(ii) Individual whose land holding does nto exceed 1 acre of irrigated and 2.5
acres of unirrigated land,

(iii) SC/ST/Physically handicapped persons/indigent students

(iv) Orphanages and women's home

(v) State owned corporation/co-operative societies including State

Corporation for SC/STs

(vi) Coperative societies, large and adivasis multi-purpose, co-op. societies

for tribal areas (LAMPS)

(vii) People engaged in cottage and rural industries. Maximum loan upto Rs.
6500/- as term or working capital or both for productive purpose, in addition
to advance Rs. 5000/- for purchase of artificial limbs/Braille typewriter. Rate
of interest 4% p.a. simple.
23. Scheme of Liberation Rehabilitation of Scavengers (SLRS):

The main objective of the scheme is to assist eligible families living in urban
& Rural areas identified by local bodies by providing alternative, viable
trade/occupation to each scavenger & dependents. Bank gives loan to
persons who have completed 18 years of age on the date of application
Maximum bank loan Rs. 32000/- on a project of Rs. 50000/- The scheme
covers 50% subsidy with a ceiling of Rs. 10000/.

24. Khadi & Village Industries Commission (KVIC) Margin Money

Scheme:

KVIC formulated this scheme for accelerated rural industrialization and rural
employment generation. Assistance is available for any village industry
projects set up in rural areas (except Khadi & Polyvastra projects). Any viable
village industry must fulfil the following four stipulations of the scheme i.e.
Village Industry, Rural Area, Per Capita Fixed Investment & Own contribution
per capita fixed investment, prescribed by KVIC is Rs. 50000/- i.e. by every
Rs. 50000/- investment, one job to be created. Loan Limit is Rs. 25 lacs, loan
can be availed by individual proprietary entrepreneurs’ firms/Trusts/SHGS/
Companies registered under companies act.
 CASH CREDIT

Cash credit is a flexible system of lending under which the borrower has the
option to withdraw the funds as and when required and to the extent of his
needs. Under this arrangement the banker specifies a limit of loan for the
customer (known as cash credit limit) up to which the customer is allowed to
draw. The cash credit limit is based on the borrower’s need and as agreed
with the bank.
Against the limit of cash credit, the borrower is permitted to withdraw as and
when he needs money subject to the limit sanctioned.
It is normally sanctioned for a period of one year and secured by the security
of some tangible assets or personal guarantee. If the account is running
satisfactorily, the limit of cash credit may be renewed by the bank at the end
of year. The interest is calculated and charged to the customer’s account.

Cash credit, is one of the types of bank lending against security by way of
pledge or / hypothetication of goods. ‘Pledge’ means bailment of goods as
security for payment of debt. Its primary purpose is to put the goods pledged
in the possession of the lender. It ensures recovery of loan in case of failure
of the borrower to repay the borrowed amount. In ‘Hypothetication’, goods
remain in the possession of the borrower, who binds himself under the
agreement to give possession of goods to the banker whenever the banker
requires him to do so. So, hypothetication is a device to create a charge
over the asset under circumstances in which transfer of possession is either
inconvenient or impracticable.
 OVERDRAFT

Overdraft facility is more or less similar to ‘cash credit’ facility. Overdraft

facility is the result of an agreement with the bank by which a current
account holder is allowed to draw over and above the credit balance in
his/her account. It is a short-period facility.

This facility is made available to current account holders who operate their
account through cheques. The customer is permitted to withdraw the
amount of overdraft allowed as and when he/she needs it and to repay it
through deposits in the account as and when it is convenient to him/her.

Overdraft facility is generally granted by a bank on the basis of a written

request by the customer. Sometimes the bank also insists on either a
promissory note from the borrower or personal security of the borrower to
ensure safety of amount withdrawn by the customer. The interest rate on
overdraft is higher than is charged on loan. The following are some of the
benefits of cash credits and overdraft:-

I. Cash credit and overdraft allow flexibility of borrowing, which depends

upon the need of the borrower.

II. There is no necessity of providing security and documentation again

and again for borrowing funds.

III. This mode of borrowing is simple and elastic and meets the short term
financial needs of the business.
 DISCOUNTING OF BILLS

Apart from sanctioning loans and advances, discounting of bills of exchange

by bank is another way of making funds available to the customers. Bills of
exchange are negotiable instruments which enable debtors to discharge
their obligations to the creditors. Such Bills of exchange arise out of
commercial transactions both in inland trade and foreign trade. When the
seller of goods has to realise his dues from the buyer at a distant place
immediately or after the lapse of the agreed period of time, the bill of
exchange facilitates this task with the help of the banking institution.
Banks invest a good percentage of their funds in discounting bills of
exchange. These bills may be payable on demand or after a stated period.
In discounting a bill, the bank pays the amount to the customer in advance,
i.e. before the due date. For this purpose, the bank charges discount on the
bill at a specified rate. The bill so discounted is retained by the bank till its
due date and is presented to the drawee on the date of maturity. In case the
bill is dishonoured on due date the amount due on bill together with interest
and other charges is debited by the bank to the customers account.
 PROCEDURE OF GRANTING CASH CREDIT, OVERDRAFT AND
DISCOUNTING BILLS

We have studied in this lesson that banks provide financial assistance to its
customers in the form of loans, advances, cash credit, overdraft and through
the discounting of bills. The procedure of applying for and sanction of loans
and advances differs from bank to bank.
However, the steps which are generally to be taken in all cases are as
follows:–

(I) Filling up of loan application form

Each bank has separate loan application forms for different categories of
borrowers. When you want to borrow money from a bank, you will have to fill
up a loan application form available with the bank free of cost.
The loan application form contains different columns to be filled in by the
applicant. It includes all information required about the borrower, purpose of
loan, nature of facility (cash-credit, overdraft etc) required, period of
repayment, nature of security offered, and the financial status of the
borrower. A running business limit may be required to furnish additional
information in respect of:

— Assets and liabilities

— Profit and loss for the last 2 to 3 years.

— The names and addresses of three persons (which may include borrowers,
suppliers, customers and bankers) for reference purposes.

(ii) Submission of form along with relevant documents

The loan application form duly filled in should be submitted to the bank along
with the relevant documents.
(iii) Sanctioning of loan

The bank scrutinizes the documents submitted and determines the credit
worthiness of the applicant. If it is found to be feasible, the loan is
sanctioned. If the loan is for Rs 5000 or less, normally the Branch Manager
himself can take the decision and sanction the loan. In case the amount of
loan is more than Rs. 5000, the application is considered at regional, zonal or
head office level, depending on the amount of loan.

(iv) Executing the Agreement

When the loan is sanctioned by the bank and the borrower is informed about
it, he will have to execute an agreement with the bank regarding terms and
condition for the amount of loan raised.

(v) Arrangement of Security for Loan

The borrower will now arrange for security against the loan.
These securities may be immovable properties, shares, debentures, fixed
deposit receipts, and other documents, like, Kisan Vikas Patra, National
Savings Certificate, as per agreement.
When the borrower completes all the formalities, he is allowed to get the
amount of loan/advance/ over draft as sanctioned by the bank. In case of
‘discounting of bills’, the bank credits the amount of bill to the customer’s
account before the realization of the bill and thus, makes available the fund.
In case, the bill is dishonored on due date, the amount due on the bill
together with interest and other charges are payable by the party whose bill
is discounted.
 PENSION PAYMENTS

Pensioners of Central and State Governments can open a separate pension

account in any of our Branches.
Pensioners are requested to produce the life certificate once in a year (i.e. in
the month of November) to enable the Branches to pay pension without
interruption/delay.
The pension will be credited by the Branch to the Pensioner's savings or
current account during the last four working days of the month. The pension
for the month of March will be credited on or after 1st working day of April.
The pension will not be paid in cash or through a joint account. Every
pensioner is required to submit life/marriage/remarriage/unemployment
certificates periodically.
EXEMPTIONS: Exemptions of minimum balance, incidental charges,
withdrawal of pension by withdrawal form to the pensioner's dependent are
available.

RE
REMITTANCE

Customers may remit funds from one centre to another centre by Demand
Draft or Telegraphic Transfer (TT) etc. by paying specified charges as per the
Bank's rules.
The customers can utilize the facility of Electronic Funds Transfer (EFT)
System operated through RBI for transferring funds to and from Delhi,
Kolkata, Chennai, Mumbai, Jaipur, Chandigarh, Kanpur, Patna, Guwahati,
Ahemadabad, Bhuvneshwar, Nagpur, Hyderabad, Bangalore and
Tiruvanantapuram, Upto Rs. 2 crores per remittance.
Demand Drafts, telegraphic and pay orders for Rs. 50,000/- and above will be
issued by the Banks only by deposit to the Customer's account or against
cheques or other instruments tendered by the purchaser and not against
cash payment. Similarly such payments for Rs. 50,000/- and above will be
made through banking channels and not in cash.
 ISSUE OF DUPLICATE DEMAND DRAFT WITHOUT
RECEIPT OF NON-PAYMENT ADVICE

As directed by the RBI, we will issue duplicate demand draft upto Rs. 5000/-
on the basis of adequate indemnity and without obtaining Non-Payment
Advice from the drawee Branch.

TIME FRAME FOR ISSUE OF DUPLICATE DRAFT

As directed by the RBI, we will issue duplicate demand draft to the customer
within a fortnight from the receipt of request. For delay in issuing duplicate
draft beyond the above stipulated period, we will pay interest at the rate
applicable for fixed deposit of corresponding maturity in order to
compensate the customer for such delay.
SERVICE
SERVICES
 Services Offered By PSB

1. Policy on collection of cheques payable locally

The Customer’s account shall be credited in respect of local cheques

deposited at the counters / dropped in drop boxes within the time indicated
for local clearing, on the same day when the bank’s account is credited in
the clearing house. Each branch would specify its own cut-off time depending
upon its working hours and distance from the clearing house. The branch
shall permit usage of the shadow credit afforded to the customer accounts
immediately after closure of relative return clearing, subject to usual
safeguards.

2. Force Majeure

The Bank shall not be liable to compensate customer for delayed credit if
some unforeseen event (including but not limited to civil commotion ,
sabotage, lockout, strike or other labour disturbances , accident ,fires,
natural disaster or other " Acts of GOD" , war damage to the bank's facilities
or of its correspondent bank(s), absence of the usual means of
communication or all types of transportation ,etc) beyond the control of the
bank prevents it from performing its obligations within the specified service
delivery parameters

3. Outstation Cheques

(i) Time frame for affording customer's Account

Cheques to be collected at State Capital in 7 days, major Metropolitan

centers in 10 days and at other centers in 14 days.

(ii) Policy of compensation on Delayed collection

The bank will pay interest to its customers on delayed collection as

applicable on saving bank deposit for the delayed period beyond the
prescribed period i.e 7/10/14 days as the case may be . Such interest shall
be paid without demand from the customers in all types of accounts.
(iii) Procedure for handling the dishonoured cheques or lost in transit

In the event a cheque or an instrument accepted for collection is lost in

transit or in clearing process or at the paying bank's branch, the bank shall
immediately on coming to know of the loss , bring the same to the notice of
account holder so that the account holder can inform the drawer to record
stop payment and also take care that cheques, if any, issued by him/ her are
not dishonored due to non- credit of the amount of the lost cheque /
instruments. The bank would pay interest at saving bank rate if the notice of
the cheque / instrument having been lost is given after the maximum
prescribed period for the collection of outstation cheques i.e 7/10/14 days, as
applicable. Such interest will be paid for the number of days the delay
occurred in giving notice to the customer beyond these prescribed 7/10/14
days as applicable.

4. Facility of Immediate credit of cheques sent for collection local

and
outstation.

The instant credit of outstation / local cheques are permitted only up to Rs.
5000/-, subject to usual safeguards as conveyed earlier for permitting such
credit, which are as under :

i)Bank should be satisfied about the proper conduct of the account of

customer.

(ii)The Bank will extend the facility to all individual depositors without
making a distinction about their status i.e Saving Bank , Current or Cash
credit.

iii) The Bank should not lay any separate stipulation for minimum balance for
extending the facility.

(iv)The facility is also to be allowed to the customers at the Bank’s Extension

Counters subject to usual precautions taken by the banks.

(v)The handling charges for local cheques and outstation cheques will be as
per Service Charges of the bank.

(vi)In case where the instrument of face value exceeding Rs. 5,000/- is
received for clearing and the proceeds of the instrument are credited to the
account, in whatever manner, in advance of the date or actual realization of
the account, interest at the stipulated rate (in addition to the usual service
charges prescribed by the Bank), shall also be charged for the period for
which outlay of funds is involved.

(vii)If cheques / instrument for which immediate credit has been afforded is
returned unpaid bank shall recover interest at clean overdraft rate for the
period bank remained out of funds and recover prescribed cheque returned
charges subject to the following:

1) No interest will be charged to the customer for the period between the
date of credit of the outstation cheque lodged and its return, unless the bank
had remained out of funds on account of withdrawal of funds.

2) Bank will charge interest from the date of return of the cheque till
reimbursement of money to the bank.

3) Where the cheque is credited to a Saving Bank Account, no interest will

be payable on the amount so credited if the cheque is returned.

4) The proceeds are credited in overdraft / Loan account, interest would be

recovered at applicable rate on the amount of returned cheque / instrument .

The salient features of the Bank’s policy with regard to the collection
period of outstation cheques and interest payable in case of delay should be
prominently displayed in each branch.

A copy of the complete policy shall be made available by the Branch

Manager, if the consumers require the same for reading.

The salient features highlighting the rights of the consumers shall also be
displayed on the notice board of each branch of the Banks.

Branches are advised to ensure that the cheques are collected within the
given time frame so that bank is not required to pay any penal interest for
delayed collection.

Zonal Managers are advised to ensure that each branch under their
jurisdiction displays its own cut-off time for acceptance of cheques at the
counters / deposited in drop – Boxes for clearing on the same day on the
Drop – Box of the Branch / on the Notice Board. Besides Zonal Managers are
to monitor and ensure compliance of above in all the branches under their
jurisdiction.
5. COLLECTION OF GOVT. DUES

The Bank handles collection of various taxes, electricity, telephone bills on

behalf of Govt. of India Public undertaking through selected designated
Branches, which will be displayed at the Branch. We are collecting Direct
Taxes presently through 209 authorized branches with group wise
connectivity.

6. EXCHANGE OF SOILED/SLIGHTLY MUTILATED CURRENCY NOTES

We freely exchange soiled/slightly mutilated currency notes and certain

other types of mutilated currency notes of all denominations.

7. INTEREST ON DEPOSITS

For your convenience, the prevailing rates on deposits are displayed

prominently at each branch, which are subject to revision from time to time.

8. SERVICE CHARGES

We provide various services to customers, for which service charges are

levied. The charges are reviewed/revised from time to time.

9. MARKETING & INSURANCE PRODUCTS

(i) Non Life Products: We are agent of M/s Bajaj Allianz General Insurance
Company and sell all their non-life products through our network of branches
across the country.

(ii) Life Products: Our bank has tie up arrangement of Life Insurance business
with M/s Aviva Life Insurance Company India Pvt. Ltd. We are offering their
following three products:

(a) Life Bonds

(b) Easy Life Plus

(c) Pension Plus

The Customers may consult our branches for more details.

10. NRI ACCOUNT & FOREIGN EXCHANGE FACILITIES

Our Bank has nine specialized International banking Divisions (IBDs) and 26
other Authorised Branches to handle Foreign Exchange Business. Besides
this, we have a Global Banking Centre at Connaught Place, New Delhi to
provide services to Non-Resident Indians with regard to deposit account.
We have various exclusive deposit schemes for Non-Resident Indians living
abroad as well as returning back to India after their venture abroad.

These schemes are:-

(i) NRE, (Non-Resident External Account)

(ii) FCNR (Foreign Currency Non-Resident)

(iii) RFC (Resident Foreign Currency) Accounts, available for various

durations from 6 months to

3 years as per RBI guidelines from time to time.

FCNR account can be opened in US Dollar, GB Pound and Euro. The account
is maintained in foreign currency and the risk of exchange rate fluctuation is
borne by the bank.

The IBDs and authorized branches cater to the needs of exporter and
importer clients for various services such as:

1. Providing fund based finance for exports at concessional rate of interest at

pre-shipment as well as post-shipment stage.

2. Providing non-fund based facilities i.e. opening of import letter of credit to

enable import of raw materials and machinery, issue of bank guarantees,
etc.

3. Negotiation of export bills under letter of credit.

4. Collection of export/import documents.

5. Advising of letter of credit with or without adding conformation.

6. Remittance of funds through SWIFT, foreign currency drafts, etc.

7. Issue of Traveler Cheques, foreign currency notes within the framework of

exchange control guidelines.
8. The Bank also grants loan against the security of deposits receipts of NRIs.
We have a network of correspondent banks across the Globe in almost all the
major foreign currencies.
11. OUR SPECIALISED BRANCHES

Name and addresses of all our specialized branches are given in Schedule-VII
at the last.

12. CHECK LIST REQUIREMENTS FOR AVAILING DIFFERENT CREDIT

FACILITIES

The requirements for availing different credit facilities from the Bank are
given in Schedule-V at the last.

13. CREDIT FACILITIES TO AGRICULTURISTS

Zamindara Credit Card, KVIC, Financial Assistance against old Tractors &
Other consumer facilities for Agriculturists are available at our Rural/Semi
Urban Branches.

14. IMPORTANT LOAN SCHEMES OF THE BANK

We have the attractive loan schemes suitable to different segment of

customers. The details of important loan scheme of our bank are given in
Schedule-IV at the last.

15. CONSUMER CREDIT

We assist our customers to uplift the standard of their living, you may
increase your purchasing power by availing consumer credit facilities at all
our Branches to purchase Television, VCR, VCP, VCD, DVD, Stereo, Washing
Machine, Refrigerator, Air-Conditioner, Microwave Oven, Dish Washer,
Cooking Range, Genset, Invertors, Computer, etc., at very low margin of 10%
only. An individual can club his/her income with that of his/her spouse to
avail higher amount of loan. The group of employees working in an
Institution/Organization in private/Public Sector undertaking can also avail
loan on very attractive terms.

16. HOUSING LOANS

To build your dream house, please avail Housing Loan at attractive rates
from our Branches/Housing Finance Branches in selected cities. The list of
our Housing Finance branches is given in Schedule-VI at the back.

17.THE WORKING HOURS FOR THE PUBLIC FOR ALL THE BRANCHES /
EXTENSION COUNTERS OF THE BANK HAVE BEEN EXTENDED BY ONE
& A HALF HOURS EXCEPT SATURDAYS OR ANY OTHER WORKING
DAYS WHICH HAVE BEEN DECLARED AS "HALFDAY" THE WORKING
HOUR HAVE BEEN EXTENDING BY ONE HOUR.
18. THE TIME FOR DISPOSAL OF LOAN PROPOSAL

The time frame for disposal of credit proposal is given as under:

B.O. Level Z.O. Level
(i) Fresh/Enhancement Proposal10 days 10 days
(ii) Renewal/Reviewal Proposal 07 days 07 days
(iii) Adhoc 05 days 03 days

19. ISSUE OF IDENTITY CARDS TO CUSTOMERS HAVING

CURRENT/CASH CREDIT ACCOUNTS

Identity Cards valid for one year are issued to those having Current/Cash
Credit Accounts as well as to their authorised representatives at a fee of Rs.
100/-.

20. VALUE-DATING OF MAIL/TELEGRAPHIC TRANSFER

Credit is given for Mail Transfer within seven days (ten days in the case of
North-Eastern States) from the date of deposit of funds.
Telegraphic Transfers issued from and payable at State Capitals and Centres
having population above 12 lakhs will be value-dated from third day.
In case of delays, Bank will pay interest at the rate applicable on Saving
Bank Deposit for the period of delay.

21. PAYMENT OF INTEREST ON DEPOSIT MATURING ON A HOLIDAY

When due date of a term deposit happens to be a holiday or a non-business

working day, then you are paid interest for the intervening holiday/non-
business working day.

22. CONCESSIONS TO RELIGIOUS, WELFARE, SERVICE, CHARITABLE

INSTITUTIONS

Collection of instruments favouring religious, welfare, service and charitable

institutions is done at par. Issue of drafts, pay orders, mail/telegraphic
transfers of these institutions is done at par. However, postage is recovered,
institutions exempted from payment of Income Tax are only eligible.
23. CONCESSIONS TO DEFENCE PERSONNEL

Concessions are extended to Defence Personnels in active service only.

Collection of outstation cheques/drafts, etc., as well as issue of drafts, pay-
orders, mail-telegraphic transfers in their account is done at par but postage
is recovered.

24. CONCESSION TO BLIND, PHYSICALLY HANDICAPPED, DISABLED

INDIVIDUALS AND INSTITUTIONS SET UP FOR THEIR BENEFIT

Institutions set up for the benefit of blind, physically handicapped and

disabled individuals are allowed, collection of up-country instruments at par.
Similarly, payments made by these institutions to their own beneficiaries by
way of drafts, pay orders, mail/telegraphic transfers are allowed, free of
charge. However, postage cost is recoverable. These institutions to be
eligible for concessions should be exempted from levy of Income Tax.

The individual accounts of the above categories of persons are identified by

the Branch Managers at the time of opening the accounts, banking services
such as issue of drafts, pay orders, mail/telegraphic transfers are rendered to
the debit of the personal account only and not against Cash, Postage
expenses are however recovered separately.

25. SENIOR CITIZENS

Additional Interest and Incentives are available for Senior Citizens. The Bank
has special schemes for the Senior Citizens, As of now, the Bank is offering
extra rate of interest of 0.50% as applicable on different maturity. They can
also avail free facility of collection / remittance of funds upto certain limit,
latest details are available with the branches of the Bank.

26. FREE CHEQUE BOOKS

For Saving Bank Accounts of individuals' one chequebook of 20 leaves free of

charge in a calendar year shall be supplied. A service charge @ Rs. 2/- per
leaf shall be levied for cheque books supplied over and above the aforesaid
limit. Service charges are subject to change without notice.

27. CORRUPTION FREE SERVICE

We will provide all the services and honour the commitment to the clients
without payment of any bribe.
28. TRANSFER OF ACCOUNTS IN THE BANK

If deposit account is transferred within the bank from one Branch to another
and there is continuity in the account, then interest is payable for the transit
period as well.

29. WE HAVE 80 FULLY COMPUTERIZED BRANCHES & 811 PARTIALLY

COMPUTERIZED BRANCHES OUT OF TOTAL NO OF 891 BRANCHES. IN
ADDITION TO ABOVE 7 SERVICE BRANCHES (RCCs) ARE ALSO FULLY
COMPUTERIZED.

30. FAIR BANKING PRACTICES

We request you as our customers to please note the following duties to

enable us to serve you better.
1. Ensure safe custody of cheque book and pass book.

2. Preferably use reverse carbon while writing a cheque.

3. Issue crossed/account payee cheques as far as possible.

4. Check the details of the cheque, namely, date, amount in words and
figures, crossing, etc., before issuing it. As far as possible, issue cheques are
rounding off the amount to nearest rupee.

5. Not to issue cheque without adequate balance, maintain minimum

balance as specified by the Bank.

6. Send cheques and other financial instruments by Registered Post or by

courier.

7. Bring pass book while withdrawing cash from Saving Bank account
through withdrawal slip. Get pass book updated from time to time.

8. Use nomination facility in all deposits accounts & locker facility.

9. Note down account numbers, details of FDR, locker numbers, etc.,

separately.

10. Inform change of address, telephone number etc., to the Branch.

11. Inform loss of demand draft, fixed deposit receipt, cheque leave(s) /book,
key of locker, etc., immediately to the Branch.
12. Avail standing instructions facility to repeat transactions.

13. Provide feedback on our service.

14. Pay interest, instalments, locker rent and other dues on time.

15. Avail services such as ATM, EFT, etc., if offered by the branch.

16. Bring any deficiency in services to the notice of the Branch Manager.

17. Not to sign blank cheque(s). So also do not record your specimen
signature either on pass book or on cheque book.

18. Not to introduce any person, who is not personally known to you for the
purpose of opening account.

19. Not to bribe any staff member, to avail corruption free service.

31. REDRESSAL OF COMPLAINTS/GRIEVANCES

"Customer day" is observed at all the offices of the Bank across the
Organisation covering branches, Zonal Offices and Head Office on 15th of
every month (next day, if 15th is a holiday or a half day). On this day any
customer can meet Senior/Top Executives of the Bank, including Chairman &
Managing Director without prior appointment.

In case of any complaint, the matter may first be brought to the notice of
concerned Branch Manager for immediate redressal. If the complaint is not
redressed to the satisfaction of the customer, the matter may be taken up
with the Zonal Manager.

If the complainant still feels unsatisfied with the response received, he can
address his complaint to bank's Nodal Officer designated to deal with
Customers' Complaints/ Grievances giving full details of the case.

After exhausting all the above machinery/channels, if the customer is still not
satisfied, he may write to Chairman & Managing Director of the Bank.

If still not satisfied, he is free to take recourse to the followings:

- Office of the Banking Ombudsman located in State Capitals under

RBI Ombudsman Scheme, 2006.

- Directorate of Public Grievances, Govt. of India, Cabinet Secretariat,

Sansad Marg, New Delhi.
- Distt. Consumer Forum, under Consumer Protection Act, 1985,

32. GRIEVANCE REDRESSAL MECHANISM, IN RESPECT OF WILLFUL

DEFAULTERS

The Bank has formed two committees of higher functionaries for redressal of
the grievances of the defaulting borrowers.

(i) Before classifying any borrowers as wilful defaulter their loan case will be
reviewed by the committee. The borrowers are then advised the reason for
classifying them as wilful defaulter.

(ii) The second committee has been formed in respect of Grievance

Redressal Mechanism which is headed by CMD and includes two other
General Managers. The concerned borrowers are provided a reasonable time
of 15 days for making representation against bank's such decision for
declaring them wilful defaulters.

PSB e-Funds TRANSFER

1) The Bank has introduced this Intra Bank Funds Transfer facility (within the
bank) for the customers of the bank at the networked branches.

2) This is a safe, secure and efficient funds transfer system.

3) SERVICE CHARGES FOR PSB-eFunds TRANSFER

(i) Outward Remittance : Rs.10/- per transaction.

(ii) Inward Remittance : NIL

 REAL TIME GROSS SETTLEMENT ( RTGS)

1) The Bank offers its customers instant transfer of funds to other banks
(Inter Bank). This is made possible through Real Time Gross Settlement
(RTGS) System, which is an online system set up, operated and maintained
by Reserve Bank of India to enable funds settlement on real-time basis
across banks in the country.

2) The RTGS service window for customer's transactions is available from

9.00 hours to 16.30 hours on week days and from 9.00 hours to 12.00 noon
on Saturdays.

Customer Interbank
Days
Transaction Transaction
Monday to 9:00 am to16:30 9:00 am to18:00
Friday hours hours
9:00 am to14:00
Saturday 9:00 am to12:00 am
hours

3) Minimum / maximum amount stipulation for RTGS transactions.

The RTGS system is primarily for large value transactions. The minimum
amount to be remitted through RTGS is Rs.1 lakh. There is no upper ceiling
for RTGS transactions.

4) SERVICE CHARGES FOR RTGS

(i) Outward Remittance:

Rs. 25/- Per

Rs. 1 Lac to 5 Lacs
Transaction
Rs. 50/- Per
Rs 5 Lacs and Above
Transaction

(ii)Inward Remittance: NIL

 NATIONAL ELECTRONIC FUNDS TRANSFER
(NEFT)

1) RBI has introduced this funds transfer systems called RBI-NEFT System.

This is an Inter-bank electronic funds transfer system to facilitate an

efficient, secure, economical, reliable and expeditious transfer of funds and
clearing in the Banking sector in India.

The account holders with the branch can use the NEFT facility which is
available between all the Cities and the designated branches of Banks in
India.

NEFT settlement takes place 6 times a day during the week days (9.30 am,
10.30 am, 12.00 noon. 1.00 pm, 3.00 pm and 4.00 pm) and 3 times during
Saturdays (9.30 am, 10.30 am and 12.00 noon).

2) No Minimum or Maximum amount stipulation for NEFT transactions.

3) SERVICE CHARGES FOR NEFT

(i) Outward Remittance :

Rs. 5/- Per

Up to Rs 1 Lac
Transaction
Rs. 25/- Per
Rs 1 Lac and Above
Transaction

(ii) Inward Remittance : NIL

 Findings & Recommendations

Findings

 A varied large number of products & services are offered by the Punjab
& Sind Bank but some of those are not received/ offered in B.O H-Block
mainly due to its location in commercial hub of the city. As such, no
agricultural advances have been made, not much of customer loans
have been given and which is also true about housing loans.

 The awareness of the products and services on offer is not much to the
customers which leads to a constraint in enhancing the Banker –
Customer Relationship.

 There is a huge scope of small consumer loans keeping in view a large

number of employees of so many commercial establishments working
in the area.

 Most of the staff has been found in rendering services in a very

personal manner which was very heartening to note.

Recommendations

 Banker – Customer Relationship could be enhanced through more of

interaction with customers in regards to their needs & there by
satisfying it by offering the relevant products or services.

 Although a very large number of pamphlets etc. with details about the
product & services offered have been printed & distributed but still it
has to be seen that they reach customers both existing & prospective
and hit in right way to their minds.

 Professional Training should be rendered to the staff to successfully

establish a healthy Banker – Customer Relationship and environment
within the Bank for good health of the branch as well as the entire Bank
& so the entire Banking Sector.
Bibliography

 Google.co.in

 Psbindia.com (Punjab & Sind Bank’s Website).

 Banking Practises by N.S. Toor.

 Various Circulars/ Circulatory Letters/ Guidelines issued by various

Departments of PSB.