Indian Banking Structure - All India Oriental Bank Officers` Association

Transcription

ALL INDIA ORIENTAL BANK OFFICERS‟ ASSOCIATION
(AFFILIATED TO AIBOA)
C/O CORPORATE OFFICE, GURGAON
_____________________________________________________________
BHOPAL/2015/
27-01-2015
Dear Comrades,
It is indeed a splendid team work exhibited by members of Central Zone Committee, Bhopal, in
the preparation of this miniature presentation in the shape of booklet, for promotion to higher
grade. We have found that the contents included in the booklet finds a wide coverage of latest/
current as well as basic banking know how. This finest presentation in booklet form is going to
help the candidates in updating their knowledge as well as for facing the written
exam/interview with confidence.
While we congratulate the Central Zone Team for their relentless efforts, we wish the aspiring
candidates all the success.
With best wishes,
Yours comradely,
Sd/-
Sd/-
(D.K. Pauddar)
( S. S. Shishodia)
President
General Secretary
All India Oriental Bank Officers’ Association___
.
INDEX
Sl.
No.
TOPIC
Page
No.
1
Our Bank‘s Vision Mission/ Imp Banking Indicators
4
2
Important Point from Bank‘s Circulars (last 12 Months)
5
3
Priority Sector
20
4
Banking / Financial Updates
26
5
Legal Aspects /SERFAESI Act / Lok Adalat
29
6
TDS
33
7
Recovery / NPA Norms
37
8
Deposit Products
42
9
IT Products
53
10
Retail Credit Products
69
11
Some Important Points
92
12
Economics Affairs / General Awareness
97
13
General Banking (Some Imp Acts & Provisions)
102
___________________________________________________________________________________
Promotion Test Booklet -2015 (updated till 20-01-2015)
3
.
Our Bank's
1. VISION STATEMENT
“TO BE A CUSTOMER FRIENDLY PREMIER BANK COMMITTED TO
ENHANCING STAKEHOLDER VALUE”
2. MISSION STATEMENT



Provide quality, innovative services with state-of-the-art technology in line with customer
expectations.
Enhance employees‟ professional skills and strengthen cohesiveness.
Create wealth for customers and other stakeholders.
Projections of Business Key Parameters (Bank as a whole)
Sl.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Parameter
Business Mix
Total Deposits
Total Advance
CD Ratio %
CASA
Share of CASA %
Retail Advances
Retail % to Total Advances
Priority Sector
PS % To ANBC
Total Agri Advances
Agri % to ANBC
Other Income /Tototal Income
Business Per Emp
2015
440000
250000
190000
76.0%
69000
27.6%
26000
13.7%
64000
40.3%
28500
17.9%
11.8%
20.18
2016
522000
294000
228000
77.6%
84000
28.6%
35300
15.5%
76000
40.0%
34000
17.9%
13.2%
22.60
2017
625000
349000
276000
79.1%
102500
29.4%
48500
17.6%
91500
40.1%
41000
18.0%
14.05%
25.51
2018
750000
415000
335000
80.7%
125000
30.0%
67000
20.0%
111000
40.2%
50500
18.3%
16.0%
28.85
Important Banking Indicators
Our Base Rate
Our P L R
10.25% (w.e.f 25/02/2013)
14.75 % (w.e.f. 14/05/2012)
Bank Rate
Repo Rate
Reverse Repo Rate
CRR
SLR
8.75% (w.e.f. 15/01/2015)
07.75% (w.e.f. 15/01/2015)
06.75% (w.e.f. 15/01/2015)
04.00% (w.e.f. 09/02/2013)
22.00% (w.e.f. 09/08/2014)
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4
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IMPORTANT POINTS FROM BANK'S CIRCULARS
 Bank has revised RTGS Timings wef from 28-01-2015(cir No.DIT/34/14-15/843 dt. 21-012015):for Customer Txn (R41) Monday to Friday 08:00 Hrs to 16:15 Hrs; Saturday 08:00 Hrs to 13:45 Hrs
for Inter Bank Txn(R42) Monday to Friday 08:00 Hrs to 19:30 Hrs; Saturday 08:00 Hrs to 14:45 Hrs
 Withdrawal of old series of Banknotes -Pre 2005 Series of Banknotes- The process of phasing
out the pre 2005 series of banknotes has been initiated by the RBI for various denominations in a
phased manner since 2008. Now the Reserve Bank of India has decided that all old series of
banknotes issued prior to 2005 (Pre-2005 banknotes) would be completely withdrawn from
circulation after June 30, 2015. (Cir No. ACT/34/CCHCELL/14-15825 13-01-2015).
 (a) Cheques bearing date prior to the opening of account should not be ordinarily be accepted for
collection (b) Any cheque received for cash, clearing, transfer should be verified through UV Lamp
and a stamp be affixed on the back of the cheque, with a signature of the verifying official
confirming verification of the cheque. (cir No.CS&P/ 84 /2014-15/824 dt. January 13, 2015)
 Premium for Personal Accidental Insurance cover for account holder (Cir No.Mktg/16/2014-15/819
09.01.2015)
Unnati Saving (SB219) – Sum Assured Rs.50000/Premium Rate 4.50+S.tax per year
Pragati Current (CA113) - Sum Assured Rs.100000/- Premium Rate 9.00+S.tax per year
 The guidelines regarding Priority Sector Lending- (CirRetail:41:2014-15:792 dt.30.12.2014)
i) Loans to individuals up to 25.00 Lacs in metropolitan centres with population above 10.00 Lacs
and 15.00 Lacs in other centres for purchase/construction of a dwelling unit per family excluding
loans sanctioned to bank‘s own employees. ii) Loans for repairs to the damaged dwelling units of
families up to 2.00 Lacs in rural and semi- urban areas and up to 5.00 Lacs in urban and
metropolitan areas.iii) Loans granted for construction of a toilet (including inter alia costs of
plumbing and fixtures, etc.) in the house qualify for classification as priority sector advances within
the above limits.
 RETAIL LENDING- Compliance of Codes of Bank‟s Commitment to Customers (cir No.
Retail:42:2014-15:793 dt.31.12.2014)
Para of
Provision in Brief
code
8.12.1.2.g Branches are required to provide to customers a sanction letter detailing particulars of
amount sanctioned, terms and conditions, etc.
3.3.1
Branches are advised to inform the borrower of changes in interest rates and changes
in reference rate.
8.18.d
In the case of securities lodged with the bank for loan availed by customers, branch
shall not insist on customers obtaining insurance cover from any particular Insurance
company.
8.12.1.2.j Branches are required to give authenticated copies of the loan documents executed
by customers at Bank‘s cost along with all enclosures
8.12.1.2p Branches are advised to return to customers all the securities/documents within 15
days of repayment of all dues.
 Staff Vehicle Loan (Cir No. HO/HRD/72/70/2014-15/804 dt 07-01-15) – One time Reg. Chg. RT
& Insurance for 1st year incurred at the time of purchase of new vehicle be included in the cost of
vehicle for the purpose of calculation of MPBF.
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5
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 OBCC Parivaar Saving Group Account-Competent Authority for allowing concessions in Retail
Loans, SME & Agriculture (Term Lending) [Cir NoCS&P/81/2014-15/810 07-01-2015]
Parameter
Concession in rate of interest for Retail Loans, SME &
Agriculture (Term Lending) subject to charging of
Minimum Lending rate i.e. Base Rate.
Feature
0.25% on the prevailing rate,
subject to minimum of Base Rate.
Processing Fee for Retail Loans, SME and Agriculture
50% discount at applicable rate.
Term Lending
The RLCC-RH to act as the Competent Authority for permitting the concession/ discount as stated
above in Table for all the three schemes namely OBC Parivaar Saving Group Account, OBC Platinum
and OBC Diamond Saving Deposit Schemes.
 Scheme for Financing Allied Agri. Activities – Common banking guidelines
Eligible Activities
Eligibility
Nature of Loan
Quantum of loan
Margin
Mode of
Poultry Farming – Loan may be provided for rearing of layers, broilers, quail, duck,
turkey, goose, etc. for production of eggs, meat, feathers and hatchery for chick
production.
Dairy Farming - Loan may be provided for Milk production activity i.e. purchase and
maintenance of milch animals (lactating cows / buffaloes) for milk production,
Rearing of good quality female calves, Cattle Breeding through Artificial
Insemination, construction of milk houses (Dudhghar) by Village Milk Cooperative
Societies, Development of pasture, Milk processing facilities, etc.
Fisheries: Inland Fisheries & Marine fisheries
Sheep/Goat Rearing: Loan may be provided for the purchase of sheep / goat for the
purpose of breeding and / or rearing them for wool, meat and milk production;
construction of sheds; purchase of equipments/tools and also for purchase of
concentrate feed,
Piggery: Loan may be provided for breeding and rearing of pigs viz. - purchase of
exotic boars and sows, purchase of weaned piglets, construction of pig-pens, etc.
Apiculture: Loan may be provided for construction of honey houses, purchase of
colonies, purchase of equipments, shifting cost of bee-boxes to suitable place in lean
floral period, for meeting recurring cost, etc.
Animal Drawn Carts: Loan may be provided for purchase of draft animals and
animal drawn carts.
Individuals, farmers, agricultural laborers, tenant farmers, landless agriculture labour,
group of farmers, Self Help Groups, Joint Liability Groups, firms, co-operative
societies, companies
Term Loan : For financing items of investment
Cash Credit : To meet out daily expanses necessary to run the farm including
payment of insurance premium, vaccination
Composite Loan :For both the purposes mentioned above.
Quantum of loan will depend on the unit cost with applicable margins subject to
economic viability
Working capital requirement during the gestation period should be capitalized and
included in the project cost
Up to `1,00,000/- Nil
Over `1,00,000/- 15%
Subsidy may be treated as margin money
Regional Head is empowered to reduce margin to 10% in deserving cases
Bank may disburse all loans for agriculture purposes in cash which will facilitate
___________________________________________________________________________________
6
Disbursement
Rate of Interest
Security
Application
of
interest
Gestation Period
and Repayment
Period
.
dealer choice to borrowers. Bank may continue the practice of obtaining receipts
from borrowers
―Base Rate‖.
Rate of Interest shall also be applicable for existing accounts w.e.f. 01.01.2015.
(i) Upto100,000/- Hypothecation of animals / birds / assets created out of Bank loan.
(ii) Above `100,000/- to `200,000/- (a) Hypothecation of animals / birds / assets
created out of Bank loan. (b) Mortgage of Land / Property* minimum equal to the
amount of loan. or 3rd party guarantee of adequate net worth acceptable to the
Bank. or Liquid securities viz. FDR / NSC / KVPs etc. which may adequately cover
the loan amount plus the prescribed margin (iii) Above `200,000/- (a) Hypothecation
of animals / birds / assets created out of Bank loan.(b) Mortgage of Land / Property*
minimum equal to the amount of loan. or
Liquid securities viz. FDR / NSC / KVPs etc. which may adequately cover the loan
amount plus the prescribed margin. * Land / Property may be Agriculture /
Residential / Commercial which are eligible for creation of bank charge and the
valuation of land shall be done as per current DLC rate
Interest on agricultural loans should be applied monthly / quarterly / half yearly /
yearly depending upon nature of activity / income generation.
These periods depend on nature of activity. Gestation period may vary from 3 – 12
months while Repayment period may vary from 12 – 84 months excluding Gestation
period. Gestation period and repayment period for each activity are prescribed in
respective annexure (1-6).
Frequency of repayment of agricultural loans should be fixed monthly / quarterly /
half yearly / yearly depending upon nature of activity / income generation.
Frequency
repayment
of
Insurance
Insurance of animals / birds / carts / assets purchased with bank loan should be got
done as per bank's guidelines issued from time to time.
of The finance made under the scheme may be classified under Agriculture / MSE as
per the guidelines of RBI circulated from time to time.
Classification
Advance
Exceptions of the
Scheme:-
(i) Where the scheme has been approved by NABARD, all the terms and
conditions stipulated by NABARD shall be followed. For the parameters which are
not discussed in the scheme of NABARD, the guidelines of this scheme shall be
applicable.(ii) The above, shall also be applicable in respect of Govt. sponsored
schemes
 Implementation of Digital Life Certificate (Jeevan Pranam) – Hon‘ble Prime Minister has
launched an Aadhaar based digital life certificate ‗Jeevan Pramaan‘ in lieu of annual life certificate
on 10th November, 2014 to realize the vision of Digital India. The purpose of Aadhaar based
biometric verification system for pensioners (Jeevan Pramaan) is to simplify processes and
facilitate accuracy and timeliness in disbursal of pension. This is an additional facility for
pensioners with existing submission of Life Certificate in physical form. (Cir No.GBC/44/201415/745 Date: 15-12-2014).
 Timely acknowledgement/ disposal of Public Grievances - The Department of Administrative
Reforms & Public Grievances, Government of India has received feedback that public grievances
are not being acknowledged and replied to within a reasonable time. Accordingly the Department
of Financial Services, Ministry of Finance has desired that all public grievances be acknowledged
within 3 days of receipt of the complaint and final reply be sent within 30day (cir Complaints /15 /
2014-15 /722 08.12.2014)
 Podjfds Categorization of Activities under Manufacture or Service under the MSMED Act
2006 - A) Activities considered as Manufacturing - a) Cotton Ginning b) Power generation by
conventional as well as by non-conventional processes B) Activities considered as Service: a)
___________________________________________________________________________________
7
.
Retreading of tyre b) Infrastructure and Real Estate activities (Enterprises should indicate in
brackets the specific activities, it dealt with, concerning Infrastructure and Real Estate) c) Power
(Electrical) Distribution Service d) Warehouse, Godown and Cold Storage service
 TIME NORMS FOR RETAIL CREDIT SCHEMES(cir No.Retail/36/2014-15/698 1-12-2014)
Time Frame for sanctioning / disbursal of loans after receipt of complete
Scheme
documents by branch as well as RO
For Loans under Branch Manager Powers: 3 to 7 days after submission of
Housing &
Mortgage
full set of documents by the borrower
For Loans under Regional Head Powers: Maximum upto 15 days after
Loan
submission of full set of documents by the borrower.
Education
Loan shall be disposed off within 15 days of receipt of duly completed
Loan
application with supporting documents
Vehicle Loan
Loan shall be disposed off at the earliest
 Abolishing of Processing fee/ Service Charges in respect of credit facility to Self Help
Groups under NRLM -Credit Risk Management Committee in its 107th meeting held on 24th
November 2014, has approved the abolishment of processing fee/ service charges in respect of
credit facility to Self Help Group under NRLM. (Cir RD &PS:56 :2014-15:685 dt 26-11-2014)
 Implementation of OTP services for VISA card based eCommerce transactios – OBC has
implemented services of sending One-Time-Password (OTP) to registered Mobile numbers of
customers for undertaking their card-based eCommerce transactions, which has replaced the
practice of using static password for VBV transactions. The said OTP services have commenced
w.e.f. 12th Nov, 2014 (cir No.DIT/ATM/30/14-15/664)
 OBC started to accept enhanced subscription of 1,50,000/- in ORIENTAL BANK TAX SAVING
TERM DEPOSIT AMENDMENT SCHEME, 2014 account (cir.CS&P/69/2014-15/663 17-11-14)
 In case of death of guarantor / partner, the operations in the account be stopped and the mater be
referred to the Sanctioning Authority within one month irrespective of fact whether review is due or
not with complete details. If the Sanctioning Authority permits the operations in the account, the
same be allowed after complying with the terms of permission. (cir CAD/75/14-15/662 dt.11-1114)
 Ibankig – OTP facility through Email – all ibanking customers are allowed to receive the login OTP
through E-mail at their registered E-mail ID. (cir no.DIT/28/14-15/629 dt. 04-11-2014)
 NACH - NCPI has implemented ―National Automated Clearing House (NACH)‖ for banks, FIs,
Corporates and Govt. a web based solution to bacilitate interbank, high volume, electronic
transactions which are repetitive and periodic in nature. Nach systems can be used for making
bulk transactions towards distribution of subsidies, dividends, interest salary pernison etc and also
bulk txns towards collection of payments pertaining to telephone electricity ater, loans, investments
in mutual funds, insurance premium etc. (cir no.DIT/ps/27/14-15/628 04-11-14)
 Home Loan – Credit Risk Guarantee Fund Scheme for Low Income Housing (CRGFS – LIH)
increased in the eligible Housing Loan Amt. form 5.00 lac to 8.00 lacs. (Cir Retail:33 :2014-15:619
dt. 01-11-2014)
 ACCOUNTS (OTHER THAN CURRENT ACCOUNTS) OF ILLITERATE PERSONS:
CATEGORY OF
OPENING ISSUANCE ISSUANCE OF OPERATION OF
CUSTOMER
OF
OF
ATM TO
ACCOUNT (MODE OF
ACCOUNT CHEQUE
ILLITERATE
OPERATION)
BOOK
Illiterate
Individually No
Yes
Self
Illiterate joint with
Jointly
No
Yes
E or S, or Joint
Illiterate
Operation
Illiterate Blind with
Jointly
No
Yes
E or S, or joint
Illiterate
Operation
___________________________________________________________________________________
8
Illiterate with literate
Jointly
Yes
.
Yes
E or S, or joint
Operation
Illiterate Blind with
Jointly
Yes
Yes
E or S, or joint
literate
Operation
In case of Joint Operation (mode of operation), ATM/Debit card will not be issued
 New TDS Regulations – 194DA of Income Tax Act 1961 - A new section 194DA has been
introduced in the Income Tax Act, 1961 (‗The Act‘), which states that any person responsible for
paying to a resident any sum under a life insurance policy, including the sum allocated by way of
bonus on such policy, other than the amount not included in the total income under clause (10D)
of Section 10, shall, at the time of payment thereof, deduct income tax thereon at the rate of two
percent. No deduction shall be made where the amount of such payment of, as the case may be,
the aggregate amount of such payments to the payee during the Financial Year is less than one
hundred thousand rupees (cir Mkt/JV/10/14-15/560 dt 27-09-2014).
 Rupay ATM cum Debit Card facility is permitted in the accounts of illiterate customers, however
it should be ensured that he/she is able to understand (i)the numerical as scripted on the ATM
machine and (ii) in the letter informing the PIN number and also (iii) to distinguish his/her card from
other cards. He/ She must be informed of the procedure of operating the ATM machine as well as
use of various buttons on ATM machine and elaborating the importance of the PIN number and
how to change them‖. (cir CS&P/54/14-15/489 dt 17-9-14)
 The Govt. of India, has enhanced the individual subscription limit under Public Provident Fund
(PPF) Scheme, 1968, from existing `1,00,000 to `1,50,000 in a financial year. (Cir no. GBC /21 /
2014-15 / 407 23-8-14)
 PMJDY - LIFE INSURANCE COVER OF Rs.30,000/- FOR PMJDY ACCOUNT HOLDER
BENEFITS UNDER THE SCHEME - The scheme provides for life cover of Rs. 30,000/- payable on
death of the beneficiary due to any cause, subject to fulfillment of the eligibility conditions:
BASIC ELIGIBILITY CONDITIONS - i. Person opening Bank account for the first time, with RuPay
Card in addition, during the period from 15-08-14 to 26-01-15, or any additional period as may be
extended further by Government of India.
ii. The person should normally be head of the family or an earning member of the family and should
be in the age group of 18 to 59 ( i.e. person should be at least 18 years old, and should not have
completed 60 years of age). In case the head of family is 60 years or more of age, the second earning
person of the family in the above mentioned age group will be covered, subject to eligibility.
iii. Person must have a RuPay Card and Bio – Metric Card linked to bank account or in process of
being linked to bank account if not already there.
iv. The account can be any bank account including a small account.
v. For the coverage to be effective the above RuPay Card should be valid and in force at the time of
the death of the member
vi. Only one person in the family will be covered in the Bima Scheme and in case of the person having
multiple cards / accounts the benefit will be allowed only under one card i.e. one person per family will
get a single cover of Rs.30,000/-, subject to the eligibility conditions.
vii. The life cover of Rs 30,000/- under the scheme will be initially for a period of 5 years, i.e. till the
close of financial year 2019-20. Thereafter, the scheme will be reviewed and terms and condition of its
continuation, including the issue of future payment of premium by the insured thereafter, would be
suitably determined.
viii. In case the PMJDY Account is held jointly, then the first account holder i.e. primary Account
holder will be eligible for cover subject to the eligibility conditions.
INELIGIBLE CATEGORIES - i. Central Government and State Government employees (in service or
retired) and their families.
___________________________________________________________________________________
9
.
ii. Employees (in service or retired) of Public Sector Undertakings, Public Sector Banks, any entity
owned by Central Government, any entity owned by a State Government or any entity jointly owned
by the Central Government and any State Government, and their families.
iii. Persons whose income is taxable under I.T. Act 1961 or are filing the yearly Income Tax return or
in whose case TDS is being deducted from the income, and their families.
iv. Persons who are included in the AamAadmiBimaYojana covering 48 occupations defined under
the Scheme, and their families.
v. Otherwise eligible account holders, who have life cover on account of any other scheme of the
Bank against the account, shall have to choose between the two schemes and derive benefit from
only one.
vi. All persons who do not fulfill the basic eligibility conditions of the scheme.
EXIT FROM SCHEME - The person will exit the scheme on completing of age 60, i.e. on the day the
person completes age 60 or closure of the Scheme, whichever is earlier.
 Cash Withdrawal at Non Base Branch-The limit of cash withdrawal i.e. Rs.1.00 lac at Non Base
branch was fixed and withdrawal beyond Rs. 1.00 lac at Non Base Branch is allowed with prior
approval of competent authority.It is informed that Regional Head has been designated as
competent authority to allow cash withdrawal beyond Rs. 1.00 lac (maximum Rs. 5.00 lac) to
valuable customers at Non Base Branch. It is reiterated that cash payment at Non Base Branch
will be allowed when the customer visits such branch himself/herself.
 Acceptance of Aadhaar e-KYC as a valid Process for KYC Verification while opening of new
Accounts - Reserve bank of India(RBI) has issued a Circular vide ref. DBOD.AML. BC. No.
44/14.01.001/2013-14 dated 02.09.2013 amending the master circulars prevailing on KYC
Norms/AML Standards/Combating Financing of Terrorism (CFT)/ Obligation of Banks under
PMLA, 2002 - accepting Aadhaar e-KYC as a valid process for KYC verification under PMLA
(Maintenance of Records) Rules, 2005. With e-KYC service of the UIDAI our Bank shall now be
able to receive an electronic copy of identify proof and address of the Customer based on his
Aadhaar Number. The e-KYC shall provide instant and paperless verification of Customer identity
and address thereby allowing Branches to quickly open the new Accounts. To achieve e-KYC of
the Customers, the Bank‘s e-KYC Application server will communicate with UIDAI‘s e-KYC server
through NPCI Interface
 Commencement of Business: Public Provident Fund (PPF)- 1968 & Senior Citizens Savings
Scheme(SCSS)- 2004. The Bank has been authorized for handling business under Public
Provident Fund- 1968 and Senior Citizen Savings Scheme-2004 through 50 authorized Branches
w.e.f 01.02.2014.
The Public Provident Fund (PPF) Scheme 1968 was introduced to mobilize small savings. The
Scheme offers an investment avenue with decent returns coupled with income tax benefits. Salient
features of the Scheme are as follows: Eligibility: Individuals in their own name as well as on
behalf of a minor can open the account at any Branch. A Public Provident Fund (PPF) account can
be opened either by the Mother or Father on behalf of their minor Son or Daughter; however the
Mother and Father both cannot open Public Provident Fund (PPF) accounts on behalf of the same
minor.
NRI, & HUF are not permitted to open account under the said scheme.
Investment Limit: Minimum of Rs.500.00 subject to a maximum of Rs.1 lac per annum may be
deposited. The amount can be deposited in lump sum or in a maximum of 12 installments per
year.
In case the subscriber is not in a position to invest during a particular year(s), the account may be
revived on payment of penalty @ Rs.50.00 per year along with arrears of subscription.
___________________________________________________________________________________
10
.
Duration of the Scheme: Original duration is 15 years. Thereafter, on application by the subscriber,
it can be extended for 1 or more blocks of 5 years each.
Rate of Interest: 8.70% per annum (presently). Interest will be paid on 31st March every year.
Interest is calculated on the minimum balance between 5th day and end of the month.
Loans & Withdrawal: Loans and withdrawals are permitted depending upon the age of the
account and balances as on the specified dates.
Tax Benefit: Income Tax benefits are available under Sec 80C of IT Act. Interest income is totally
exempt from Income Tax.
Nomination: Nomination facility is available in the name of one or more persons. The shares of
nominees may also be defined by the subscriber.
Transfer of Accounts: The account can be transferred to other branches/ other banks or Post
Offices and vice versa upon request by the subscriber.
 Senior Citizens Savings Scheme(SCSS)-2004:
Eligibility: Senior Citizens Savings Scheme has been introduced for persons with 60 years (55
years for those who have retired on superannuation or under a voluntary or special voluntary
scheme). The retired personnel of Defence Services (excluding Civilian Defence Employees) will
be eligible to invest irrespective of the age limits subject to the fulfillment of other specified
conditions.
NRI, PIO & HUF are not permitted to open account under the said scheme.
Investment limit: Investment to be in multiples of `1000/- Maximum investment limit 15 lakh
Duration of the scheme: 5 years, which can be extended by 3 years.
Rate of Interest: 9.2 per cent per annum (presently).
Nomination: Nomination facility is available.
Mode of Holding: Accounts can be held both in single and joint holding modes. Joint holding is
allowed only with spouse.
Investment: Both the spouses can open individual and / or joint accounts with each other with the
maximum deposits up to `15 lakh each, provided both are individually eligible to invest under
relevant provisions of the Rules governing the Scheme.
Transfer of Accounts: The account can be transferred to other branches/ other banks or Post
Offices and vice versa upon request by the subscriber.
 Timely lodging of Claims in CGTMSE - Guideline for lodging of claims is as under:
i) Bank / Borrower has to pay Guarantee Fee / Annual Service Fee / Annual Guarantee Fee
regularly in time to keep guarantee in force.
ii) The date of classification of the account as NPA in a particular quarter is to be marked on online
CGTMSE portal by the end of subsequent quarter
iii) Lodgment of Claims:
For loan sanctioned on or before 31.12.2012 the claims are to be lodged within a maximum
period of one year from the date of NPA, if date of NPA is after the lock-in-period. In case date of
NPA is within lock-in-period, claim is to be lodged within one year from the expiry of lock-in period.
For loan sanctioned on or after 01.01.2013 the claims are to be lodged within a maximum period
of two years from the date of NPA, if date of NPA is after the lock-in-period. In case date of NPA is
within lock-in-period claim is to be lodged within two years from the expiry of lock-in period.
The lock-in-period is 18 months from either the date of last disbursement of the loan to the
borrower or the date of payment of guarantee fee in respect of the credit facility to the borrower,
whichever is, later.
iv) The borrower account is to be classified NPA as per norms.
v) The credit facility should have been recalled and the recovery proceedings initiated under due
process of law i.e. Bank should initiate the legal action in any of the Forums like Civil Court / DRT /
___________________________________________________________________________________
11
.
Lok Adalat / RC File / RRA/SARFAESI etc. However, initiation of legal proceedings as a precondition for invoking of guarantee shall be waived for credit facilities upto Rs.50,000/- sanctioned
on or after 01.01.2013, subject to the condition that for all such cases, where the filing of legal
proceedings shall be waived by Regional Heads. Such cases are referred to Executive Committee
of the bank headed by GM (RD&PS) at Head office, for not initiating legal action and lodging claim
thereof. On approval from Head office, claims in these cases are to be lodged with CGTMSE.
vi) The Declaration & Undertaking duly signed by Asst. General Manager or officer of equivalent
rank of Regional office is to be enclosed with the Claim Application Form submitted to trust.
vii) The claims are lodged online at CGTMSE portal by Regional office.
 Government of India has vide their notification dated 25.03.2014 notified that the maximum limit for
investment in Inflation Indexed National Savings Securities- Cumulative has been increased to Rs.
10 lakh per annum for eligible individual investors and Rs. 25 lakh per annum for Institutions such
as HUFs, Charitable Trusts, Education Endowments and similar institutions which are not proprofit in nature. The subscription will close on March 31, 2014
 SETTING UP OF CENTRAL REPOSITORY OF INFORMATION ON LARGE CREDITS (CRILC)
 The Reserve Bank of India will set up a Central Repository of Information on Large Credits
(CRILC) to collect, store, and disseminate credit data to lenders.
 Banks will have to furnish credit information to CRILC on all their borrowers having aggregate
fund-based and non-fund based exposure of `5 Crore and above with them.
 In addition, banks will have to furnish details of all current accounts of their customers with
outstanding balance (debit or credit) of `1 Crore and above.
 Banks will be required to report, among others, the SMA status of the borrower to the CRILC.
 Banks are required to put in place a proper Management Information and Reporting System so
that any account having principal or interest overdue for more than 60 days gets reported as SMA2 on the 61st day itself.
 Individual banks will have to closely monitor the accounts reported as SMA-1 or SMA-0 and take
up the issue with the borrower with a view to rectifying the deficiencies at the earliest.
 Reporting of an account as SMA-2 by one or more lending banks/notified NBFCs will trigger the
mandatory formation of a Joint Lenders‘ Forum (JLF) and formulation of Corrective Action Plan
(CAP).
 FORMATION OF JLF (JOINT LENDERS FORUM) and CAP (CORRECTIVE ACTION PLAN)
1. The JLF formation will be mandatory for distressed borrowers, engaged in any type of activity,
with aggregate (fund based and non-fund based) exposure (AE) of 100 Crore and above from
more than one lender.
2. Lenders, however, have the option of forming JLFs even when the aggregate fund-based and
non-fund based exposures in an account are less than 100 Crore and even when the account is
reported as SMA-0 or SMA-1.
3. A borrower may request the lender/s, with substantiated grounds, for formation of a JLF on
account of imminent stress. When such a request is received by a lender, the account should be
reported to CRILC as SMA-0. Further, the lenders should also form the JLF immediately if the AE
is 100 Crore and above.
4. The CAP by JLF may explore various options to resolve the stress in the account including: (a)
Rectification (b) Restructuring (c) Recovery
5. The decisions agreed upon by a minimum of 75% of creditors by value and 60% of creditors by
number in the JLF would be considered as the basis for proceeding with the restructuring or
recovery action of the account, and will be binding on the lenders under the terms of the Inter
Creditor Agreement (ICA).
6. The JLF is required to arrive at an agreement on the option to be adopted for Corrective Action
Plan (CAP) within 30 days from (i) the date of an account being reported as SMA-2 by one or more
___________________________________________________________________________________
12
.
lender, or (ii) receipt of request from the borrower to form a JLF, with substantiated grounds, if it
senses imminent stress.
6. PENAL MEASURES
6.1. In case the bank fails to report SMA status of the accounts to CRILC or resort to methods with
the intent to conceal the actual status of the accounts or evergreen the account, bank will be
subjected to accelerated provisioning as prescribed below for these accounts and/or other
supervisory actions as deemed appropriate by RBI.
6.2. The current provisioning requirement and the revised accelerated provisioning in respect of
such non performing accounts are as under:
Classification
Substandard Up to 6 months
(secured)
6 months to 1 year
15
Revised
accelerated
provisioning (%)
No change
15
25
Sub-standard
Up to 6 months
(unsecured abinitio)
25 (other than infrastructure 25
loans)
20 (infrastructure loans)
Doubtful I
Doubtful II
Doubtful III
Period as NPA
Current provisioning (%)
6 months to 1 year
25 (other than infrastructure 40
loans)
20 (infrastructure loans)
2nd year
25 (secured portion)
100 (unsecured portion)
100 (unsecured portion)
100
(unsecured
portion)
100
for
both
secured
and
unsecured portions
100
100
3rd & 4th year
5th year onwards
 On a review of the Permitted Transactions under the Rupee Drawing Arrangements (RDAs), it has
been decided by RBI vide its A. P. (DIR Series) Circular No. 111 dated March 13, 2014 to increase
the limit of trade transactions from the existing Rs 2,00,000/- (Rupees Two Lakh only) per
transaction to Rs 5,00,000/- (Rupees Five Lakh only) per transaction.
 Liberalised Remittance Scheme (LRS) for resident individuals-Increase in the limit from
USD 75,000 to USD 125,000
RBI vide its A.P. (DIR Series) Circular No.138 dated June 3, 2014 has decided to enhance the
existing limit of USD 75,000 per financial year (April-March) to USD 125,000 with immediate effect.
Accordingly, AD Branches may now allow remittances up to USD 125,000 per financial year,
under the Scheme, for any permitted current or capital account transaction or a combination of
both.
 Online Saving Bank Account Application- Bank, is in the process of providing online application
facility for opening the saving account in different locations. Any resident Indian desirous of
opening a Savings Bank. Account with OBC (Branches located in Metro and Urban centres) can
apply for Saving Bank Account on line and get an Application Reference Number. The Application
reference number shall be displayed on the screen for communication to applicant to visit the
branch with required documents within 10 days
___________________________________________________________________________________
13
.
REVISED SCHEDULE AND AUTOMATIC RECOVERY OF CHARGES ON REGISTERATION OF
EQUITABLE MORTGAGE IN CENTRAL REGISTRY (CERSAI)
S.
No.
1
Nature of transaction to be FORM
Registered
No.
Particulars of Creation or FORM I
Modification
of
Security
Interest in favour of Secured
Creditors
2
Satisfaction of any existing FORM II
Security Interest
Particulars of securitisation or FORM
reconstruction of financial III
assets
Particulars of satisfaction of FORM
securitisation
or IV
reconstruction transactions
Any application for information recorded /
maintained in the Register by any
person/ Search of the Property
Any
application
for --condonation of delay up to 30
days
3
4
5
6
Amount of fee payable
For creation and for any subsequent
modification of security interest in favour of a
secured creditor for a loan
1. Upto Rs. 5.00 lac - Rs. 250.00 + applicable
Service Tax.
2. Above Rs. 5.00 lac- Rs. 500.00+ applicable
Service Tax
Nil
Rs.1000.00 + applicable Service Tax
1. In case of creation of security interest for a
loan up to Rs.5.00 lac -- Not exceeding
2. In case of creation of security interest for a
loan above Rs.5.00 lac – Not exceeding
In order to streamline the process, the recovery of charges on particulars of creation of Security
Interest with Central Registry through Finacle has now been automated through CBS system.
 Revised Policy on Credit Information Reports of the Borrowers provided by the Credit
Information Companies (CICs). 1 CIBIL TRANSUNION SCORE 2. CIBIL PERSONAL LOAN
SCORE
1.1. Presently, there are four Credit Information Companies registered with RBI viz:
 Credit Information Bureau of India Ltd. (CIBIL)
 Equifax Credit Information Services Private Limited
 Experian Credit Information Company of India Private Limited
 High Mark Credit Information Services Private Limited
1.2. The revision in Bank‘s Policy on Credit Information Reports of the borrowers provided by the
Credit Information Companies(CICs): (1) CIBIL TransUnion Score and (2) CIBIL Personal Loan Score
was approved by the Board of Directors in the meeting dated 31.01.2014 vide Agenda No. 6 and was
circulated to the field functionaries vide Circular No. HO/RMD/92/2013-14/1092 dated 15.02.2014.
1.3. The revised system of scrutinizing the Credit Information Report (CIR) of the borrowers provided
by the Credit Information Companies (CICs) was approved by the Credit Risk Management
Committee vide Agenda No.15 in the meeting dated 31.03.2014 with an aim to have:
 Better quality of credit portfolio,
___________________________________________________________________________________
14
.
 Objective and transparent scrutiny/processing of credit proposals and effective pricing,
 Monitoring of the credit facilities.
1.4. The scrutiny summary report of Credit Information Reports(CIRs) of the borrowers provided by
the Credit Information Companies(CICs) to be made part of loan appraisal format was circulated to the
field functionaries vide Circular No. HO/ RMD/01/2014-15/24 dated 09.04.2014.
 EXISTING GUIDELINES REGARDING CREDIT INFORMATION REPORTS(CIRs) PROVIDED
BY CREDIT INFORMATION COMPANIES (CICs)
CIBIL maintains separate Database for Consumer and Commercial Segments. The Consumer
Segment caters to the information regarding borrowers in the individual capacity and the
Commercial Segment caters to entities that are other than individuals (firms/companies).
In the Commercial Segment, CIBIL provides a detailed Credit Information Report(CIR) of the borrower
incorporating profile of the borrower, details regarding credit facilities sanctioned to the borrower,
inquires made by the lenders, default status, details regarding the Suit filed, if any, etc. CIBIL does not
provide any score for the borrowers under Commercial Segment.
In the Consumer Segment (Individuals), CIBIL provides two scores viz, CIBIL TransUnion Score
Version 2.0(TU) and CIBIL Personal Loan Score (PL).
CIBIL TransUnion Score Version 2.0(TU)
CIBIL TransUnion Score Version 2.0(TU) takes into account both Secured and Unsecured Exposures.
The Consumers/Borrowers having more than 6 months of credit history are given score in the range of
300-900 and higher the score, lower is the risk.
The Consumers/Borrowers having less than 6 months of credit history are given score in the range of
1-5 and higher the score, lower is the risk.
CIBIL Personal Loan Score (PL)
CIBIL Personal Loan Score (PL) takes into account only Unsecured Exposures.
All individuals with at least 1 month of reporting of Unsecured Loans will get a score between 300 –
900.
Clarifications sought by the Field Functionaries
The field functionaries have sought clarifications regarding Score of -1 under CIBIL TransUnion Score
Version 2.0 and CIBIL Personal Loan Score.
INTERPRETATION OF CIBIL SCORE
The interpretation of Score of -1 under CIBIL TransUnion Score Version 2.0 as provided by CIBIL is
as follows:
Individual has no trade & is not reported on the bureau.
Individual has no trades & has only been enquired upon.
Individual has trades on bureau, but all have been closed 24 months prior to enquiry.
Individual has trades but none have been reported in the last 24 months.
The interpretation of Score of -1 under CIBIL Personal Loan Score is as follows:
Borrowers with no eligible trades in the Bureau, only enquired upon
 Issuance of Demand Drafts against cash
1. In case of cash Transactions below `.50,000/-carried out by a non account based customer that is
walk in customer, full details of the customer, including complete address, telephone number etc.
should necessarily be obtained.
2. To curb the misuse of banking channels for violation of fiscal laws and evasion of taxes the RBI has
issued guidelines regarding issue and payment of Draft for `.50000/- and above. As per guidelines a
___________________________________________________________________________________
15
.
draft for `. 50,000/- and above should not be issued against deposit of cash. It is not permissible for a
customer to split amount ofRs.50,000/- and above and request for more than one demand draft on the
same day favoring the same beneficiary.
3. In case of transactions carried out by a non-account based customer, that is a walk- in customer,
where the amount of transaction is equal to or exceeds rupees fifty thousand, whether conducted as a
single transaction or several transactions that appear to be connected, the customer's identity and
address should be verified.
4. Such request for issuance of multiple drafts for belowRs.50,000/- each (by way of deposit of cash)
in the name of different beneficiaries on behalf of a single applicant though can be considered but
should be discouraged keeping in view the AML guidelines. However, if drafts have to be issued,
before accepting such requests, the branch must be put on caution and seek the following:
a) PAN of the applicant, b) Reasons for getting multiple drafts issue by way of deposit of cash. c)
Complete details of the existing banker of the applicant along with the details of credit facilities
sanctioned, if any. d) In case applicant is enjoying credit facilities from any bank/FI, advise the
applicant to get the drafts issued from its banker. e) In other cases, obtain complete identification
proof as per KYC norms. (Self attested copies of the identity and address proof be obtained, verified
from the original and attested by concerned bank officer). All such documents be attached with the
voucher for record and future reference.
 ATM / Debit Card facility in the Minor‟s account operated by Natural/Legal Guardian
As per Bank‘s existing policy for issuing ATM/ Debit Cards, following types of customers are not
eligible for ATM/ Debit Cards:
1. Minors below 14 years 2. Illiterate 3. Insolvent. 4. Persons operating the accounts in
representative capacity
Presently the ATM cum Debit card is not issued in the Minor‘s accounts opened/operated under/by
natural /legal guardian, as these accounts are held in representative capacity.
With a view to facilitate transactions in the accounts of Minors the Bank‘s Policy of issuing ATM cum
Debit Card has been modified as under:
1. Self Operated accounts of Minor-An ATM/DEBIT Card is issued to a minor of the age of 14
years and above.
2. ATM cum debit cards may be issued to natural/legal guardian after taking the following
onetime undertaking at the time of issuing ATM cum Debit card at the branch
“The amount withdrawn/spent through ATM/debit card shall be exclusively utilized for the
necessities and benefits of the minor‖
 PAYMENT OF RUPEE TERM DEPOSITS (FDR/CDR AND PROGRESSIVE DEPOSITS) AT
NON-BASE BRANCHES
Existing System
Modification
Payment of TDR on maturity
(To the credit of account)
In case a depositor has not exercised the
option to automatically credit the amount in
his operative account on maturity, has to
present the TDR physically at the issuing
branch only. No other branch is permitted
to make
the payment
The depositor may present the original
TDR at any branch of the bank with the
instructions to credit the maturity proceeds
in his/her operating account by giving the
proper discharge on TDR according to the
mandate registered in the account (e.g. ―E
or S‖ ―F or S‖ ―joint Operation‖ etc.)
___________________________________________________________________________________
16
Cash Payment of TDR on maturityThe cash payment of TDR (the amount less
than Rs.20,000/- Including Intt. as per IT
rules) is made to the depositor after
observing all safeguards like signatures etc.permitted at base branch only.
Payment of Term Deposits on/before/after
maturity to the depositors by way of
remittance
of
funds
through
Draft/RTGs/NEFTThe transaction is permitted at base branch
only.
Renewal of TDR on maturity
In case the customer has not exercised the
option of Auto Renewal at the time of
account opening, the customer can get it
renewed w.e.f the date of maturity in case he
approaches the base branch for renewal on
due date or within in 14 days after due date.
On receiving such request, the base
branch, extends the validity/renews the TDR
in the system and mention the details
regarding ROI, tenure, due date in the format
provided at the reverse of TDR. There is no
need issuing new TDR.
The activity takes place at base branch.
Renewal of overdue term Deposit
The original TDR is presented at the base
branch and is renewed w.e.f the date of
request after allowing intt. for the overdue
period at applicable rates.
Encashment of Overdue Term Deposit
The original overdue TDR is presented at
base branch. The Overdue interest@ SB
rate is paid and the maturity amount is
paid/credited to the depositor/credited in the
depositor‘s account. (As the case may be)
Payment of Progressive Deposits on
maturity-
.
No Change
No Change
Renewal of TDR on Maturity
In case the Term Deposit Receipt is already
auto renewed in the system, the depositor
may present the TDR at any branch of the
bank for updation of details.
In case the TDR is not auto renewed in the
system, The original TDR can be presented
at any branch of the bank for renewal.
The TDR shall be renewed as per existing
bank‘s policy of renewal of Term Deposits.
Renewal of overdue term Deposit
The depositor may present the overdue TDR
in original, at any branch of the bank for
renewal.
The Intt-Paid Account of the base branch
shall be debited and the TDS account (if
deducted) of the base branch shall be
credited. It shall be the responsibility of the
base branch to dispatch Form 16 at the
depositors address.
(In case the customer has shifted the base,
and he approaches a non-base branch for
renewal of Term deposit he may be
suggested to transfer his account to that
branch for his own convenience).
Encashment of Overdue Term Deposit
The encashment of Overdue TDR if
presented in original at non-base branch
may be paid as per bank‘s policy on
encashment of overdue term Deposits,
through the depositor‟s account.
The Interest Paid account of the base
branch shall be debited, and TDS activity
shall happen at the base branch only.
The payment of Progressive Deposit
Account which has completed its term may
___________________________________________________________________________________
17
Permitted at base branch only.
.
be paid at non base branches by crediting
the maturity proceeds to the depositors‘
operative account.
Premature Payment of all types of Term No Change
Deposits: Permitted at base branch only
Other activities: Marking lien, lifting lien, No Change
issuing
TDS
certificate,
registration,
modification, cancellation of nomination etc
are permitted at base branch only.
 INCOME TAX PROVISIONS IN RESPECT OF APPLICABILITY OF FORM 15G / 15H (Circular
No. HO/ACT/ 02/2013-14/56 20.04.2013)
Central Board of Direct Taxes vide notification dated 19.02.2013 has modified the guidelines
regarding applicability of Form 15G & 15H. Vide said notification, CBDT has also changed the format
of 15G & 15H. We are forwrding the revised guidelines for applicability of Form 15G / 15H :
A. Provision regarding Applicability of Form 15G/15H
While accepting form 15G/15H, following points should be kept in mind : Form 15G/15H should be accompanied with the PAN of the assessee, Otherwise TDS is to be
deducted at the rate of 20% or the applicable rate whichever is higher.
 Form 15G can be accepted from any person other than company or firm if the amount of interest
paid/credited or likely to be paid or credited alongwith the estimated income declared by the
declarant during the financial year does not exceed the maximum amount not chargeable to tax
i.e. Presently Rs. 2.00 lakhs.
 Form 15H can be accepted only from senior citizens / super senior citizens if the amount of
interest paid/credited or likely to be paid or credited alongwith the estimated income declared by
the declarant during the financial year does not exceed the maximum amount not chargeable to
tax i.e. presently Rs 2.50 Lakhs for Senior Citizen and Rs 5.00 Lakhs in case of Super Senior
Citizen. The said limit is after allowing deduction under Chapter VI A of the Income Tax Act.
 Senior Citizen is a resident individual who is 60 years or more at any time during the financial
year but not more than 80 years on the last day of financial year.
 Super senior citizen is a resident individual who is 80 years or more at any time during the
financial year.
 The branches should ensure that declaration in Form 15G & 15H received from the parties is
filed with the respective Commissioner of Income Tax on or before 7th of the following
month in which declaration is received. Failure to do so entail levy of penalty by the income tax
authorities.
B. Penalty for non-furnishing / delay in furnishing form 15 G/ 15H :
If Form 15G/15H is not furnished with the concerned authorities on time then a penalty of Rs.100 can
be imposed for every day during which the default continues.
All other guidelines regarding applicability of provisions of TDS communicated vide circular No
HO/ACT/27/2012-13/565 dated 01.11.2012 will remain same.
 FINANCIAL AND PERFORMANCE BANK GUARANTEES
Capital Calculation for Off Balance Sheet exposure under Basel II: For Capital calculation under
Basel II, the Off-Balance Sheet exposures are first converted into an On-Balance Sheet exposure
___________________________________________________________________________________
18
.
(Credit Equivalent Amount) by multiplying the Off-Balance Sheet exposures with a percentage value
known as Credit Conversion Factor (CCF). Thereafter the appropriate risk weights are applied to the
Credit Equivalent Amount to arrive at Risk Weighted Assets (RWA) and finally the capital requirement
for the same.
 The Credit Conversion Factor (CCF) for various types of Off-Balance Sheet exposures varies
based on the risk associated, contractual obligation and potential liability arising out of respective
Off-Balance Sheet items viz. CCF for Letter of Credit – 20%, Performance Bank Guarantee – 50%,
Financial Bank Guarantee – 100%, Letter of Comfort – 100% etc.
KYC
Individuals:
Individuals
Socially downtrodden, Belonging to lower strata of Society, Poor,
Covered under various Govt. Sponsored Programmes and PS
Advances, Engaged in Petty /Small Businesses, Pensioners,
Whose Accounts show small balances and low turnover.
Perceived Risk
Low Risk or C1
Govt. Employees, Salaried Class People, Working with well-known
Organizations, Public Limited Companies etc. Whose jobs and
Salary Structures are well defined
Low Risk or C1
Professionals & Highly Paid Employees
Medium Risk or C2
High Net-worth Individuals-Non Resident Individuals, Bullion
Dealers (Including Sub-Dealers) & Jewelers
High Risk
or C3
Politically Exposed Persons & Persons of Dubious Reputation
Very High Risk
or C4
Other than individuals
All Government Departments, Government owned Companies and
Corporations, Public Sector Undertakings, Regulators, Statutory
Bodies etc.
Perceived Risk
Low or C1
Private Organizations, Private Institutions, Public Limited
Companies, Private Limited
Companies, Firms
Medium / High
C2 / C3
Bullion Dealers (Including Sub-Dealers) & Jewelers
High / C3
Companies having Close Family Shareholding or Beneficial
Ownership
Firms with Sleeping PartnersTrusts, Charities, NGOs and
Organizations receiving Donations
All Non-face to face Customers
Very High C4
Very high/ C4
Very high / C4
Very high /C4
Very high /C4
___________________________________________________________________________________
19
.
Priority Sector Advances
(i) Agriculture (ii) Micro and Small Enterprises (iii) Education (iv) Housing (v) Export Credit (vi) Others
Targets /Sub-targets for Priority sector
(i)
The targets and sub-targets set under priority sector lending for domestic and foreign
banks operating in India are furnished below:
(ii)
Categories
Domestic
commercial Foreign banks with less
banks / Foreign banks with than 20 branches
20 and above branches
Total Priority Sector
40 percent of Adjusted Net 32 percent of ANBC or credit
Bank
Credit
or
credit equivalent amount of Offequivalent amount of Off- Balance Sheet Exposure,
Balance Sheet Exposure, whichever is higher.
whichever is higher.
Total agriculture
18 percent of ANBC or credit No specific target. Forms part
equivalent amount of Off- of total priority sector target.
Balance Sheet Exposure,
Micro & Small Enterprises (i) Advances to micro and No specific target. Forms part
(MSE)
small enterprises sector will of total priority sector target.
be reckoned in computing
achievement
under
the
overall priority sector target of
40 percent of ANBC or credit
equivalent amount of OffBalance Sheet Exposure,
(ii) 40 percent of total
advances to micro and small
enterprises sector should go
to
Micro
(manufacturing)
enterprises having investment
in plant and machinery up to
Rs. 5 lakh and micro (service)
enterprises having investment
in equipment up to Rs 2 lakh;
(ii) 20 percent of total
advances to micro and small
enterprises sector should go
to
Micro
(manufacturing)
enterprises with investment in
plant
and
machinery
aboveRs.5 lakh and up
toRs.25 lakh, and micro
(service) enterprises with
investment
in
equipment
aboveRs.2 lakh and up
toRs.10 lakh
___________________________________________________________________________________
20
.
Export Credit
Export credit is not a separate No specific target. Forms part
category. Export credit to of total priority sector target.
eligible
activities
under
agriculture and MSE will be
reckoned for priority sector
lending under respective
categories.
Advances
to
Weaker 10 percent of ANBC or credit No specific target in the total
Sections
equivalent amount of Off- priority sector target.
Balance Sheet Exposure,
For foreign banks with 20 and above branches, priority sector targets and sub-targets have to be
achieved within a maximum period of five years starting from April 1, 2013 and ending on March 31,
2018
Weaker Sections under priority Sector:
Small and marginal farmers;
Artisans, village and cottage industries where individual credit limits do not exceedRs.Rs.50,000;
Beneficiaries of Swarnjayanti Gram Swarozgar Yojana (SGSY), now National Rural Livelihood Mission
(NRLM);
Scheduled Castes and Scheduled Tribes;
Beneficiaries of Differential Rate of Interest (DRI) scheme;
Beneficiaries under Swarna Jayanti Shahari Rozgar Yojana (SJSRY);
Beneficiaries under the Scheme for Rehabilitation of Manual Scavengers (SRMS);
Loans to Self Help Groups;
Loans to distressed farmers indebted to non-institutional lenders;
Loans to distressed persons other than farmers not exceeding `Rs.50,000 per borrower to prepay their
debt to non-institutional lenders;
Loans to individual women beneficiaries upto Rs. 50,000 per borrower;
Loans sanctioned as above to persons from minority communities as may be notified by Government
of India from time to time.
Priority Sector Classification Norms:
Category
Norms
Agriculture ( Direct Agriculture and allied activities
& Indirect)
Directly to individual farmers, SHG,JLG- No limit
To Partnership, Corporates- upto Rs.2 crore
Small Enterprises
All loans granted to Micro & Small Enterprises
( Manufacturing & Service)
(Small & Micro service enterprises shall include small road and water
transport operator, small business, retail credit, professional & self
employed and other service enterprises)
Loans to Khadi & Village Industry Sector
Loans sanctioned by banks to MFIs for on-lending to MSE sector as per
the conditions specified.
Micro Credit
Education Loan
Credit upto Rs.50,000/ per borrower, either directly or indirectly through
SHG/JLG or to NBFC/MFI for on-lending upto Rs.50,000/- per borrower
Upto Rs.10 lac for study in India
Upto Rs.20 lac for study abroad
___________________________________________________________________________________
21
Housing Loan
.
*Loans upto Rs.25 lacs to individual for constructing/purchase of
dwelling unit per family in Metropolitan Centres with population above
Rs.10 lac. and Rs.15 lac in other centres.
*Upto Rs.5 lac in urban and metro and Rs.2 lac in rural and semi urban
areas for repair of dwelling unit.
*Upto Rs.5 lac per dwelling unit to any governmental agency for
construction or for slum clearance and rehabilitation of slum dwellers
*Upto Rs. 5 lac per dwelling unit for weaker section & low income group
for loans to housing projects.
*Bank loans to any governmental agency for construction of dwelling
units or for slum clearance and rehabilitation of slum dwellers subject to
a ceiling of 10 lakh per dwelling unit.
Export Credit
Others
*The loans sanctioned by banks for housing projects exclusively for the
purpose of construction of houses only to economically weaker sections
and low income groups, the total cost of which do not exceed 10 lakh
per dwelling unit. For the purpose of identifying the economically
weaker sections and low income groups, the family income limit of
1,20,000 per annum, irrespective of the location, is prescribed
*Bank loans to Housing Finance Companies (HFCs), approved by NHB
for their refinance, for on-lending for the purpose of
purchase/construction/reconstruction of individual dwelling units or for
slum clearance and rehabilitation of slum dwellers, subject to an
aggregate loan limit of 10 lakh per borrower, provided the all inclusive
interest rate charged to the ultimate borrower is not exceeding lowest
lending rate of the lending bank for housing loans plus two percent per
annum.
Export Credit extended by foreign banks with less than 20 branches
Upto Rs. 50,000 per borrower provided directly by banks to individuals
and their SHG/JLG, provided the borrower‘s household annual income
in rural areas does not exceed Rs.60,000/- and for non-rural areas it
should not exceed Rs. 1,20,000/-.
Loans to distressed persons (not included elsewhere) not exceeding
Rs.50,000 per borrower to prepay their debt to non-institutional lenders.
Loans outstanding under loans for general purposes under General
Credit Cards (GCC). If the loans under GCC are sanctioned to Micro
and Small Enterprises, such loans should be classified under
respective categories of Micro and Small Enterprises.
Overdrafts, up to `50,000 (per account), granted against 'no-frills' /
basic banking / savings accounts provided the borrowers household
annual income in rural areas does not exceed Rs.60,000/- and for nonrural areas it should not exceed Rs.1,20,000/-.
Loans sanctioned to State Sponsored Organisations for Scheduled
Castes/ Scheduled Tribes for the specific purpose of purchase and
supply of inputs to and/or the marketing of the outputs of the
beneficiaries of these organisations.
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22
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Loans sanctioned by banks directly to individuals for setting up off-grid
solar and other off-grid renewable energy solutions for households.
Small & Micro Enterprise:
Micro Enterprise( Enterprise engaged in manufacturing/production or preservation of
Manufacturing)
goods whose investment in plant and machinery ( original cost
excluding land & building) does not exceed Rs.25 lacs
Micro
Enterprise Enterprise engaged in providing/rendering services whose in
(Service)
equipment( original cost excluding land & building) does not exceed
Rs.10 lac
Small
Enterprise Enterprise engaged in manufacturing/production or preservation of
( Manufacturing)
goods whose investment in plant and machinery ( original cost
excluding land & building) does not exceed Rs.5 crores
Small
Enterprise Enterprise engaged in providing/rendering services whose in
( Service)
equipment( original cost excluding land & building) does not exceed Rs.
2 crore.
Small & Micro( Service) enterprise shall include small road & water transport operator, small
business, retail credit, professional & self employed and other service enterprises.
Credit Guarantee Scheme for Micro and Small Enterprises:
The Scheme framed by the Board of Trustees of Credit Guarantee Fund Trust is known as Credit
Guarantee Fund Scheme for Small Industries (CGFSI) which came into force from August 1,2000.
On enactment of MSMED Act-2006 the Trust was renamed as Credit Guarantee Fund Trust for Micro
and Small Enterprises and scheme as Credit Guarantee Scheme for Micro and Small Enterprises.
Eligible Credit facilities: Fund based and/or Non fund based) extended by Member Lending
Institution(s) to a single eligible borrower in the Micro and Small Enterprises sector for credit facility
(i) not exceeding Rs. 50 lakh (Regional Rural Banks/Financial Institutions) and
(ii) not exceeding Rs.100 lakh (Scheduled Commercial Banks and select Financial Institutions) by way
of term loan and/or working capital facilities on or after entering into an agreement with the Trust,
without any collateral security and\or third party guarantees
The lending institution has to apply for guarantee cover in respect of credit proposals sanctioned in a
quarter prior to expiry of the following quarter
Provided further that, as on the material date
(i) The dues to the lending institution have not become bad or doubtful of recovery; and / or
(ii) The business or activity of the borrower for which the credit facility was granted has not ceased;
and / or
(iii) The credit facility has not wholly or partly been utilized for adjustment of any debts deemed bad or
doubtful of recovery, without obtaining a prior consent in this regard from the Trust.
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23
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Any credit facility which has been sanctioned by the lending institution with interest rate more
than 3% over the Prime Lending Rate (PLR) of the lending institution will not be eligible for the
guarantee cover.
Guarantee Fee and Annual Service fee
One-time guarantee fee at specified rate ((a)currently 1.00% in the case of credit facility upto Rs. 5
Lakh and 1.5% in the case of credit facility above Rs. 5 Lakh (b) 0.75%, in case of credit facilities upto
Rs.50 lakh sanctioned to units in North Eastern Region including State of Sikkim) of the credit facility
sanctioned (comprising term loan and / or working capital facility) shall be paid upfront to the Trust by
the institution availing of the guarantee within 30 days from the date of first disbursement of credit
facility (not applicable for Working capital) or 30 days from the date of Demand Advice (CGDAN) of
guarantee fee whichever is later or such date as specified by the The annual service fee at
specified rate (currently 0.50% in the case of credit facility upto Rs. 5 Lakh and 0.75% in the case of
credit facility above Rs. 5 Lakh) on pro-rata basis for the first and last year and in full for the
intervening years on the credit facility sanctioned (comprising term loan and / or working capital
facility) shall be paid by the lending institution within 60 days ie. on or before May 31, of every year
Guarntee Cover:
Category
Upto Rs.5 lakh
Micro Enterprises
Maximum extent of Guarantee where credit facility is
Above Rs.5 lakh upto Rs.50 lakh
Above Rs.50 lakh upto Rs.100
lakh
85% of the amount in default 75%
Rs.37.50 lakh plus
subject to a maximum of Rs.4.25 /Rs.37 50% of amount in
lakh
.50
default above Rs.50
lakh
lakh subject to overall
ceiling of Rs.62.50 lakh
80% of the amount in default Rs.40 lakh plus 50% of amount
subject to a maximum of Rs.40 in default above Rs.50 lakh
lakh
subject to overall ceiling of
Rs.65 lakh
Women
entrepreneurs/
Units located in North East
Region (incl. Sikkim) other
than credit facility upto
Rs.5
lakh
to
micro
enterprises
All
other
category of 75% /
borrowers
Rs.37.50 lakh
Rs.37.50 lakh plus 50% of
amount in default above Rs.50
lakh subject to overall ceiling of
Rs.62.50 lakh
All proposals for sanction of guarantee approvals for credit facilities above Rs. 50 lakh and upto
Rs.100 lakh will have to be rated internally by the MLI and should be of investment grade.
Proposals approved by the MLIs on or after December 8, 2008 will be eligible for the coverage upto
Rs.100 lakh.
The guarantee cover will commence from the date of payment of guarantee fee and shall run through
the agreed tenure of the term credit in respect of term credit / composite credit.
Where working capital alone is extended to the eligible borrower, the guarantee cover shall be for a
period of 5 years or a block of 5 years, or for such period as may be specified by the trust in this
behalf.
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24
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Micro Credit:
It is provision of thrift,credit and other financial services and products of very small amount to the poor
in rural,semi-urban and urban areas to enable them to increase their income level and improve their
standard of living.
Self-help Groups(SHGs):
SHGs are registered or unregistered small economically homogeneous and affinity groups of rural
poor,voluntarily coming together for mutual benefits.
SHGs undergo the following stages;
a) Group formation
b) Group Stabilisation
c) Micro Credit Stage
d) Micro Enterprise development Stage
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No.of members: 10-20.For irrigation projects:- no ceiling for handicapped persons: 5-20 members
Members should be the persons below poverty line.
Persons marginally above poverty line normally upto 20% can also be included.But they will not be
eligible for subsidy.
One person from from one family in one SHG
One person cannot be member of more than one SHG.
Regular weekly or fortnightly meetings are to be held.
Members have to save regularly out of their earnings.
Saved funds are meant for lending to members to be decided by all the members.
Proper record/book-keeping is essential.
Linkage to bank is established through Savings A/c.
Kalia Committee set up by RBI recommended financing of SHGs.
SHGs can be financed by way of Cash Credit or Overdraft.
Corpus to Loan Ratio may be 1:1 to 1:4
Min. subsidy Rs.5000 & Max. subsidy Rs.10000 being equal to the group corpus.
Additional subsidy of Rs.10000 as 2nd dose may be available to SHG showing promise.
No interest on subsidy.
Subsidy can be adjusted when activity is discontinued or group dissolved or loan becoming bad for
recovery.
Indirect finance to SHGs can be extended through registered NGOs with good track record and
financial management .
NGOs should collect savings of SHGs regularly.
NGOs prepare projections for lending for 1-3 years and provide 25% margin.
Term Loan component is 75% with 100% refinance from NABARD.
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25
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BANKING / FINANCIAL UPDATES
 SEBI planning to relax FPO rules -Minimum free float market capitalization for public companies
could be lowered from `3000 cr to `2000 cr‘.
 In September this year, United Bank of India declared the now-grounded Kingfisher Airlines and its
Chairman Vijay Mallya as wilful defaulters for non-payment of dues of Rs 400 crore.
 ICICI Bank launches new credit card with American Express - ICICI Bank has introduced a
new credit card in association with American Express named ICICI Bank Coral American Express
Credit Card.
 Central Bank employees union files PIL seeking direction to recover bad loans- Burgeoning
bad debts in public sector banks has prompted an employees union to file a public interest
litigation (PIL) seeking the Bombay High Court‘s ‗interference and directions‘ for effecting loan
recoveries.
 ARC gives India positive rating with stable outlook - Here is some good news for the NDA
Government. The Europe-based ARC Ratings SA (ARC) has assigned India ‗BBB+‘ sovereign
rating which is a shade better than what has been assigned by the big three global credit ratings
agencies.
 NPCI links 10 cr Aadhaar cards to bank accounts - The National Payments Corporation of India
(NPCI)-managed National Financial Mapper has crossed the milestone of getting 10 crore bank
accounts seeded with Aadhaar numbers. This allows the Government department/agencies to
reach out to beneficiaries of direct benefit transfer schemes.
 RBI extends 5:25 scheme to some existing infra projects - The RBI on Monday extended its
flexible refinancing and repayment option for long term infra projects to existing ones where the
total exposure of lenders is more than Rs.500 crore.
 Banks hire environmental, social specialists to reduce NPA risks - ‗Go green‘ appears to be
the new mantra for banks, which are struggling to stem asset-quality risks amid an uncertain
macroeconomic environment.
 In a first, SEBI orders imprisonment for not paying penalties - For the first time ever, capital
market regulator Securities and Exchange Board of India (SEBI) has imposed a term of civil
imprisonment for a violation. Vinod Hingorani, Non-Executive Chairman of Adam Comsof and
Kolar Biotech, was ordered to undergo six months‘ civil imprisonment for failure to pay penalties of
around Rs. 1.64 crore (including interest) levied under three SEBI notices from last July
demanding payment.
 SpiceJet: loans will be given only if promoters step forward, say banks - The troubled lowcost airline SpiceJet will find the going tough as risk-averse banks are unlikely to provide loans.
Though the Government has urged banks to rescue the Chennai-based airline with Rs. 600 crore
working capital loans, banks have so far not shown willingness to provide any loans
 ICICI Bank out of Russia, trims foreign operations- ICICI Bank, one of the largest private
lenders in the country, is calibrating its global ambitions — selling its subsidiary in Russia,
repatriating capital from its UK (United Kingdom) and Canada arms, and shrinking its international
balance sheet.
 Basmati exports set to decline - This year, earnings from the export of basmati rice are
expected to fall 15-20 per cent, owing to Iran banning the import of the commodity from India.
 Paytm Set to Apply for a Payment Banking Permit; To Enter Singapore - Paytm, a fastgrowing mobile wallet company, is set to apply for a payment banking permit, becoming the first
entity to formally announce interest in launching a service that is part of the RBI's financial
inclusion initiative. The company also plans to expand services overseas, starting with Singapore
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26
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 Mutual Funds Latch on to Make-in-India Theme - The Narendra Modi government's ‗Make in
India' campaign has inspired domestic mutual funds to launch schemes that would benefit from the
proposed initiative. At least three mutual funds have launched or are coming out with schemes that
will invest in companies in the manufacturing sector, which will be the proxy for the theme.
 EPFO to Support Housing Scheme, Invest in Equities - The Employees' Provident Fund
Organisation (EPFO) will on Friday consider a proposal to set aside a part of its corpus for
investment in housing finance companies to help with the government's affordable housing
initiative.
 PF trustees retain 8.75% interest rate for 2014-15 - The trustees of retirement funds belonging
to about eight crore depositors on Friday decided to retain the interest rate at 8.75 per cent for
2014-15. In January this year, the trustees had raised the interest rate for 2013-14 to 8.75 per
cent, from 8.5 per cent in 2012-13.
 EPFO eases norms on deposits in govt banks - The Employees Provident Fund Organisation's
trustees, on Friday, relaxed the norms for parking funds in bank deposits. And, referred the issue
of investing a portion of its funds into the equity market and housing sector to a committee.
 Consumers Open to Payment Banks Idea - Payment banks, expected to promote financial
inclusion, could prove to be a big hit. A Nielsen survey shows an overwhelming majority of
consumers were willing to open such accounts. Payment banks don't give loans but accept retail
deposits, utility payments and funds transfer. RBI has allowed mobile firms and supermarket
chains to set up payment banks.
 Lenders Likely to Rejig Corporate Power - In what could be a first, banks are preparing to
change the management structure of Corporate Power, an Abhijeet Group company, and issue a
legal notice to recover dues worth Rs. 3,100 crore. Bankers led by State Bank of India (SBI) have
taken a two pronged approach to recover their dues -while they plan to issue a legal notice to
seize their assets, they have also called for bids from corporates to take over the management
control of the company that operates 1,080MW power plant in Jharkhand, said two senior bankers
who declined to be named.
 HDFC offers fixed-rate home loans for 10 years - Housing Development Finance Corporation
(HDFC) has launched fixed-rate home loans for 10 years, for loans sanctioned between December
22 and January 2015. The first disbursement should be on or before March 21, 2015.
 RBI's upper age limit of 70 for private bank CEOs
 Oriental Bank of Commerce - Suresh N Patel, ED, Oriental Bank of Commerce presented Floral
Bouquet to Padma Bhushan Dr.Yamini Krishnamurti, an eminient Indian Dancer of Bharatnatyam
and Kuchipudi, on the occasion of Delhi Economics Conclave 2014 organized in New Delhi by
Department of Economic Affairs, ministry of Finance, Govt. of India
 Reforms push: Cabinet clears land acquisition ordinance - The Centre today recommended an
ordinance to make significant changes to the Land Acquisition Act so as to fast track projects in
key sectors such as power, roads, defense and housing.
 Jan Dhan may be extended to insurance, pension sectors - Prime Minister‘s Jan Dhan Yojna
(PMJDY) is likely to be replicated in the insurance and pension sector to extend the financial
services to the hinterland. ―Given the low levels of penetration of insurance and pension, there is a
case for subsequently extending or replicating a project on the lines of PMJDY, to include the
provision of insurance and pension services for the common man,‖ RBI said.
 Now, a Gyan Sangam to Help Put Banking Back on Track -The top echelons of Indian banking will
converge early in the New Year in a Gyan Sangam or `Confluence of Knowledge' at the National
Institute of Bank Management in Pune to hammer out a strategy to revive the ailing state-owned
banking sector, which is bogged down by a mountain of bad debt, political interference and lack of
consolidation.
 Governance reform: Centre splits Chairman, MD post in state-run banks - In a bid to improve
governance, the Centre has separated the posts of Chairman and Managing Director in
nationalised banks. It has also appointed Managing Directors for four banks, and they will also be
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designated as Chief Executive Officer. The four new MDs and CEOs are P Srinivas (United Bank
of India), Animesh Chauhan (Oriental Bank of Commerce), R Koteeswaran (Indian Overseas
Bank) and Kishore Kumar Sansi (Vijaya Bank).
Splitting of CMD‟s post in PSBs Rings in Management Reforms - The Centre has kick-started
management reforms of public sector banks, splitting the post of Chairman & managing Directorcum-CEO in appointments in four banks and indicating that it will widen its search for heads of
other banks to possibly include candidates from the private sector.
RBI Clarifies Rules for Small Bank Applicants - The Reserve Bank of India on Thursday
clarified that business houses with assets above Rs. 1,000 crore with finance companies will not
be eligible to apply for a small bank license. The regulator also said that existing non-banking
finance companies have to fold their operations into the small bank.
CONSORTIUM OF 17 BANKS FILES CONTEMPT APPLICATION AGAINST MALLYA -A CONTEMPT
APPLICATION WAS FILED BY A CONSORTIUM OF 17 BANKS IN THE KARNATAKA HIGH COURT ON TUESDAY
AGAINST LIQUOR BARON VIJAY MALLYA AND OTHERS FOR ALLEGEDLY VIOLATING AN UNDERTAKING
GIVEN TO THE DRT THAT THEY WOULD NOT ALIENATE UNENCUMBERED ASSETS NOR DEAL WITH THEM.
Fiscal Burden from Pension Bill Could Rise to 4.1% of GDP by 2030 -The government's fiscal
burden in providing a safety net to the elderly could rise to as much as 4.1% of the GDP by 2030
from 2.2% at present, a report by global analytical company Crisil has said. Currently, the central
government spends 3-3.4% of GDP on education and just over 1% of GDP on medical and public
health, water supply and sanitation.
Now, tap and pay debit, credit cards from ICICI Bank -ICICI Bank has launched India‘s first
‗contactless‘ or ‗tap and pay‘ facility on debit and credit cards to enable electronic payments with a
mere tap. These cards will enable electronic payments by just tapping or waving the cards near
the merchant terminal in lieu of dipping or swiping them.
Shareholders approve ING Vysya, Kotak merger - Shareholders of private sector ING Vysya
Bank and Kotak Mahindra Bank Ltd have accorded sanction to the merger of the former with the
latter at their respective Extraordinary General Meetings (EGM) held on Wednesday, the banks
said.
Jan Dhan Yojana to Get Some Cosmic Help, Via VSAT Tech - The government is eyeing
satellite connectivity to ensure the Pradhan Mantri Jan-Dhan Yojana (PMJDY) , aimed at widening
financial inclusion, moves to the next phase after reaching the critical 10 crore bank accounts
milestone.
MODI TRANSFORMS VIBRANT GUJARAT INTO VIBRANT INDIA - PRIME MINISTER NARENDRA MODI SAID
INDIA IS GETTING READY TO TAKE A ―QUANTUM LEAP―, ELEVATING THE VIBRANT GUJARAT SUMMIT HE
FOUNDED AS CHIEF MINISTER IN 2003 INTO A PLATFORM TO HARD SELL INDIA AS THE NEXT BIG
OPPORTUNITY TO STATESMEN SUCH AS US SECRETARY OF STATE JOHN KERRY AND UN SECRETARYGENERAL BAN KI-MOON, AND INDUSTRY BOSSES FROM ACROSS THE GLOBE.
OPENWORLD MONEY TO GET ON TO MOBILE PLATFORM IN MARCH -FINANCIAL SERVICES START-UP
OPENW ORLD MONEY, WHICH IS ROLLING OUT ITS DIGITALLY INTEGRATED FINANCIAL MARKETPLACE IN
THE NEXT FEW DAYS, WILL EXPAND ITS SERVICES TO THE MOBILE PLATFORM BY MARCH. THE COMPANY
WILL INITIALLY OFFER SOLUTIONS IN THE MUTUAL FUNDS SPACE, FOLLOWED BY INSURANCE AND
BANKING.
PRIVATE LENDERS' CONTRIBUTION TO JAN DHAN ONLY 3% -THE CONTRIBUTION OF PRIVATE SECTOR
BANKS TO OPENING ACCOUNTS UNDER THE PRADHAN MANTRI JAN-DHAN YOJANA (PMJDY) HAS BEEN
DISMAL.
AMUL LAUNCHES 'MILK CARD' IN COLLABORATION WITH SBI - AMUL IN COLLABORATION WITH SBI
LAUNCHED AMUL MILK CARD, A PREPAID SMART CARD, AT MOTHER DAIRY IN GANDHINAGAR ON
MONDAY. THE CARD CAN BE USED TO PURCHASE PRODUCTS FROM AMUL PARLOURS.
MAHILA BANK LOOKS TO DOUBLE LOAN BOOK - BHARATIYA MAHILA BANK IS TARGETING A LOAN BOOK
OF RS.800 CRORE AND DEPOSITS WORTH RS.1,000 CRORE FOR FISCAL YEAR ENDING 2014-15. THE
BANK, LAUNCHED BY THE GOVERNMENT ABOUT A YEAR AGO TO SUPPORT WOMEN ENTREPRENEURS, IS
ALSO PLANNING TO OPEN 40 MORE BRANCHES WITHIN THE NEXT THREE MONTHS.
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 RAJIV GANDHI EQUITY SAVINGS SCHEME –
RGESS is a tax saving scheme (announced in the union budget 2012-13) is exclusively for the first
time retail individual investors in securities market.
Investors : The scheme is open for all New Retail Investors who have gross total income less than or
equal to Rs. 12 lakhs. A non-resident India is not eligible for investment in RGESS.
Procedure : The new retail investor will open demat account and eligible securities, brought theafter
will be automatically subject to lock-in upto a value of Rs.50000/Investment options : i) Listed equity shares a) The top 100 stocks at NSE and BSE
i.e.CNX100/BSE-100. b) Stocks of PSUs categorized by Govt. as Maharatna, Navaratna and
Miniratna. c) Combinations of stocks in (a) and /or (b) which are listed and traded on a stock
exchange and settled through a depository system. d) Follow-on Public Offers of (a) and (b). e) New
Fund Offers (NFOs) of (c) above.
ii) United equity shares : IPOs of PSUs which are scheduled to get listed in the relevant financial
year and where the govt. holding is at least 51% and whiose annual turnover is not less than Rs.4000
cr for each of the immediate past three years.
Tax Deduction : Tax deduction u/s 80CCG on 50% of the amount invested (for Rs.50000/-, the
amount eligible for tax deduction will be Rs.25000/-). This deduction is over and above Rs.1 lakh limit
specified under section 80C. Dividend is tax free
LEGAL ASPECTS
 As per which provision of Securitization Act 2002, application can be filed before collector/ DM for
getting physical possession of the Secured Asset - Section 14 of the Act
 As per which provision in Securitization Act 2002, Appeal/Application can be filed before DRT by the
Borrower - Section 17 of the Act (within 45 days)
 As per which provision in Securitization Act 2002, Second appeal can be filed by the Borrower/
Guarantor to DRAT - Section 18 of the Act (within 30 days)
 Limitation for filing execution Petition after obtaining Decree - 12 years
 Maximum & Minimum members in a Pvt. Ltd. Company - 50 & 2
 Minimum members in a Public Ltd. Company - 7
 Maximum number of members in a partnership firm if it is a Banking company - 10
 Maximum number of members in a partnership firm if it is not a Banking company - 20
 Minimum directors in a Pvt. Ltd. Company - 2
 Minimum directors in a Public Ltd. Company - 3
 Time limit for having the first statutory meeting of a company after the incorporation of a company within 6 months
 Pecuniary jurisdiction of DRT - 10 lac & above
 Maximum court fee to be paid in DRT - 1.50 lac
 Minimum court fee to be paid in DRT - 12,000/- up to `10 lacs, exceed every 1 lac `1000/ As per which Act DRT is constituted - Recovery of Debts due to Banks and financial Institutions Act
1993
 Which is the provision for filing appeal to DRAT against the order of the presiding officer in DRT Section 20 (within 45 days)
 Which is the provision for filing appeal to the presiding officer in DRT against the order of the
Recovery Officer in DRT - Section 30 (within 30 days)
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 Within How many days, appeal should be filed before presiding officer in DRT against the order of
the Registrar of DRT - within 15 days
 How many days time should be given in the demand notice sent to the Borrower as per Section 13
(2) of Securitization Act 2002 - 60 days
 Banking ombudsman scheme is introduced in the year - 1995
 Consumer Protection Act introduced in the year - 1986
 How much time will be the maximum gap between two Annual General Meeting of a Company - 15
months
 Within How many days, application for creating charges to be filed before Registrar of Companies 30 days (Section 125 of Companies Act 1956)
 As per which provision in Indian Limitation Act 1963, Limitation is extended for further 3 years by the
obtention of Balance Confirmation Letter - Section 18
 As per which decision of Supreme Court, it is made clear that simultaneous action under
securitization act along with DRT/ Suit Filed with any other court can be taken - Transcore v/s Union
of India
 Pecuniary Limit for Filing RRC - below 10 lac
 Limitation for filing mortgage suit before Court- 12 years
 Limitation for filing money suit before Court - 3 years
 Pecuniary Jurisdiction of Banking Ombudsman - 10 lacs
 What is the prescribed time limit within which consumer Forum should dispose the Compliant - 3
months
 What is the prescribed time limit within which DRT should dispose the Original Application - 6
months
 What is the prescribed time limit within which Banking Ombudsman should dispose the Compliant 6 months
 Limitation for filing compliant with Banking Ombudsman - 1 year
 Limitation for filing compliant with Consumer Forum - 2 years
 Pecuniary Jurisdiction of District Consumer Forum - 20 lacs
 Pecuniary Jurisdiction of State Commission (Consumer) - Between 20 lacs and One Crore
 Pecuniary Jurisdiction of National Commission (Consumer) - above 1 Crore
 Maximum period of imprisonment can be given by a Court under section 138 of NI Act 1881 - 2
Years
 Maximum period of civil imprisonment can be given by a Civil Court in the execution of a decree - 3
months
 Action under section 138 of NI Act – Send 15 days legal notice within 30 days of the date of
dishonor of cheque.
Documentation, Stamp Duty and Limitation :
Who is to Sign the documents or create mortgage
Borrower
Who is to Sign
Individual
Himself / His agent
Joint Borrowers
All / their agent
Proprietorship firm
Proprietor / Agent
Partnership firm
All partners
HUF
Karta. If coparceners are to be made liable, they are also to sign
Joint Stocks Company Person authorized by the resolution from the Board of directors
Trust/Club/Society
Trustee/person authorized by their governing documents/resolution
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Stamp Duty Rates
Instrument
Receipts for any money or property the amount or value which exceedsRs.5000
Proxy letter
Letter of credit
Transfer of shares (` 100 or part)
Demand bill of exchange / cheque
Demand promissory note:
Value not more thanRs.250
Value more thanRs.250 less than `1000
Value of more than `1000
Rate (`)
1.00
0.15
1.00
0.25
NIL
0.05
0.10
0.15
Loan account wise limitation period
Demand Loans
Demand promissory note
TOD
Term loan
C C Hypothecation
C C Pledge
Bills discouting
Bills purchasing
Loan secured by mortgage
Recovery of loss caused by fraud
Suit by state/Central government
Right of foreclosure and right of redemption in
case of mortgage
Deposit accounts like SB, CA or matured
FDRs
Appeal to high court against lower court
Appeal to other court on the decree at lower
court
Execution of decree
3 years from the date of loan
3 years from the date of DPN
3 years from the date of loan
3 years from the date of each installment
3 years from the date of document
NA
3 years from the due date of the respective bill
3 years from the date of bill
Instead of 3 years, the period would be 12 years
3 years from the date of fraud detection
30 years from the period when limitation begins
30 years when money becomes due and when
right to recover occurs respectively
3 years from the date of demand
90 days from date of decree
30 days from date of decree
12 years from the date of decree
SARFEASI ACT
 The act has two parts, first part stands for securitisation and reconstruction of financial assets and
other part is enforcement of security interest.
 Eligible assets under the act may be enforced without intervention of court or tribunal with the laid
down procedure under the act.
 If party failed to deposit the amount, possession of charged/ secured assets is obtained from the
bank under section 13(4) of the act. Publication of possession notice in the act within 07 days is
mandatory.
 No secured creditor shall exercise any right, unless exercise of such right is agreed upon by the
secured creditors representing not less than 3/4th in value of the amount outstanding.
 If borrower restricts the bank to take physical possession of secured assets, petition is filed under
section 14 of the act to the CMM/DM praying to get the physical possession of the assets.
 No action is taken before 45 days of taking possession, as 45 days time is given under the act to
appeal against the action of the bank.
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 Appeal with DRT can be filed by the party only after taking possession of the assets under section
17 of the act. Thereafter appeal can also be filed with DRAT under section 18 of the act. Civil court
does not jurisdiction to entertain any suit under provision of the act.
 Secured assets can be disposed off / sold giving 30 days notice to the parties concerned followed by
30 days publication of sale through auction/ tender notice of these assets in the vernacular
newspaper and national daily.
 60 days notice is served under 13(2) of SARFEASI
 Action is taken for the dues exceed `1 lac
 Agriculture Land and lease hold property can not be enforced
 Appeal is made within 45 days of possession of secured asset
 30 days notice is served indicating there in the sale of asset
 30 days publication is made for auction of secured assets
 Possession of property is obtained under 13(4) SARFEASI Act
 Publication of possession of property - within 7 days from the date of possession.
 SERFEASI ACT 2002 does not apply to the following assets –
A - lien on any goods, money or security.
B - A pledge of moveable.
C – Creation of any security in any aircraft or vessel.
D – Any property that can not be attached under any other law.
E – Any security interest for securing repayment any financial asset not exceeding `1 lac.
F – Any case in which the amount due is less than 20% of the principal amt.
G – Any interest created in agriculture land.
LOK ADALAT
 Lokadalat has been constituted under Legal Services Act, 1987. No legal fee is charged for
approaching Lokadalat.
 All NPA a/cs including suit filed and decreed having outstanding balance uptoRs.20.00 lacs can be
referred to the Lokadalat. All legal disputes pending in civil, criminal, revenue courts or a tribunal can
be taken to lokadalat for amicable settlement except criminal cases which are non- compoundable.
 Accounts can be settled by the bank as per the mutual consent of the parties.
 Award passed by the Lokadalat is a deemed decree of the court, which can be executed in case of
default by the borrowers / judgement debtor through court of competent jurisdication.
 National Lok Adalat held on 13-12-14 & next national Lok Adalat will be held on 14-02-15.
Existing Powers of Functionaries for settlement of Deceased Claims :
Presently the following functionaries have been vested with the powers for settling such claims as
approved and communicated vide Recovery & Law Dept., Head Office Circular
Functionaries
Branch Incumbents in Scale-I,II
Branch Incumbents in Scale III & IV
Branch Incumbents in Scale V & above
RLCC-RH headed by DGM
RLCC-RH headed by GM
GM committee at Head Office
HLCC-ED at Head Office
CAC at Head Office
Thresh hold limit/Powers
Upto Rs 5.00 lacs
Upto Rs. 10.00 lacs
Up to Rs. 25.00 lacs
Upto Rs. 50.00 lacs
Upto Rs. 1.00 Crore
Above 50.00 lacs and Upto Rs.1.00
crore
Above 1.00 crore and Upto Rs.4.00
crore
Above Rs. 4.00 crore
___________________________________________________________________________________
32
.
In order to further simplify the settlement of claims and to help the legal heirs of the deceased account
holders with credit balance ofRs.25000/- and below, the following sub-threshold limit has been
approved
Functionary
Branch Incumbent/ Incumbent In charge (in all scales)
Sub- Threshold limit
25000/- and below
Further, following clarifications are being given for settling the deceased depositor‘s claim cases
In respect of claims on the basis of court orders viz. Probate/ Succession Certificate, the same can be
settled by branch Incumbents irrespective of the amount involved.
* Claims by nominees in respect of the accounts where a valid nomination is registered as per Branch
records, shall be disposed of at Branch level, in accordance with nomination; irrespective of the
amount involved.
* It is clarified that the branch incumbents are vested with the powers to settle the cases of class I
legal heirs of male deceased depositor as well as legal heirs as per Section 15 (a) in case of female
deceased depositors in accordance with Hindu Succession Act 1956, whether they are Hindu, Sikh,
Jain or Buddhist.. The claims other than above and other claims relating to Muslim & other
communities and claims by guardian other than natural guardian shall be dealt at Regional office level
even when the claim amount falls within Branch powers. Further claims in respect of ‗Either or
Survivor‘ & ‗Former or Survivor‘ accounts shall be disposed of at branch level as per instruction
* The indemnity bond is to be obtained from all the legal heirs of the deceased depositor with two
sureties
* Before processing the deceased claim case, all the claim papers submitted by claimants to the
branch, be got vetted by the legal retainer, if the concerned branch is situated in the city where
Regional office is situated and by the panel advocate if the concerned branch is situated in other cities
on a lump sum fee ofRs.500.00 only
TAX DEDUCTED AT SOURCE (T.D.S)
1. Floor limit of TDS on Term Deposit10000/- (wef 01-06-2007)
2. Form 15 G - To be obtained from Persons (other than Senior Citizen)
3. Form 15 H - To be obtained from Senior Citizen
4. Form 60 - for Non Agriculture
5. Form 61 - for Agriculture
Tax Deduction at Source (TDS) at a Higher Rate (20%) on Transactions on not quoting of PAN
As per the amended provisions, w.e.f. 1.04.2010, TDS at higher of the prescribed rate or 20% will be
deducted on all the transactions liable to TDS, where Permanent Account Number (PAN) of the
deductee i.e., the party is not available.
The law will also apply to all non-residents in respect of payments/remittances liable to TDS. Further,
Certificate of deduction of tax at lower rate or no deduction (under section 197 of the Income Tax
Act,1961) shall not be issued by the concerned Income Tax Authority to the party i.e., to whom eligible
payment is made by the bank, unless the application of the party bears PAN. In addition, declaration
by the depositor in "Form 15 G/Form 15H"(under section 197A of the Income Tax Act, 1961) shall not
be valid unless it bears the PAN of the depositor.
Keeping in view the above amendments, the offices are advised, as under:
___________________________________________________________________________________
33
(i)
.
Where the payment to the party is liable to TDS and the party has not quoted PAN, to deduct
TDS at higher of the prescribed rate or 20%. The basic exemption limit and the prescribed
TDS rates in force are reproduced below for ready reference.
PAYMENT TO RESIDENTS IN INDIA
S.No.
1
Nature of Payment
Prescribed
TDS liable to be deducted
TDS
rate
(SurchargeNil
&CessNil)
Interest on Term Deposits 10%
If the interest credited or paid (likely to be
(Domestic Company as
credited or paid) during the financial year
well
as
other
than
exceeds `10,000/-.
Domestic Company)
P.S: TDS ON INTEREST ON TERM DEPOSITS NOT LIABLE TO BE DEDUCTED
(a) Interest is credited/paid to any banking company, co-operative society engaged in banking
business, public financial institutions, the Life Insurance Corporation, the Unit Trust of India or
notified Institutions (only on receipt of exemption certificate from the tax authorities)
(b) Interest other than on time deposits.
(c) Interest is credited or paid on compensation awarded by the Motor Accident Claims Tribunal if
the amount of payment or the aggregate amount of such payment does-not exceed `50,000/2.
Commission
or 10%
If the interest credited or paid during the
brokerage
financial year exceeds `5000/3a.
Rent of plant and 2%
machinery (with effect
financial year exceeds `1,80,000/from October 1,2009)
3b.
Rent of land or building or 10%
furniture or fitting ( with
financial year exceeds `1,80,000/effect from October
1,2009)
4.
Fees for professional or 10%
technical services
5.
Payment
Contractors/Subcontractors
to
If the amount credited or paid (likely to be
exceeds `30,000/The amount of any (single) sum credited or
paid (likely to be credited or paid) exceeds
`30,000/- and the aggregate of the amounts
of such sums credited or paid (likely to be
does-not exceed `75,000/-
(a) Payment/credit to an 1%
individual or a HUF
contractor/sub-contractor
(w.e.f 01/10/2009)
(b) Payment/credit to any 2%
person other than an
individual or a HUF
contractor/sub-contractor
(w.e.f 01/10/2009)
___________________________________________________________________________________
34
.
INTEREST PAYMENTS TO PERSONS NOT RESIDENTS IN INDIA
Nature of Payment
Income Tax
(%)
Surcharge (%)
Cess (%)
Total (%)
A. In case where the person (other
than company) which is not
resident in India
30%
-
0.90%
30.90%
B.(i) In case of a company which is
not a domestic company (where
the total income does-not
exceedRs.one crore)
40%
-
1.2%
41.20%
(i) In case of a company which is
not a domestic company (where
the total income exceedsRs.one
crore)
40%
0.8%
1.224%
42.024%
It is reiterated that under the existing provisions of the Income Tax Act, 1961 and circulars
issued there under, no tax is required to be deducted at source on payment of interest to the
holders of Non –Resident (External) Account and FCNR deposits as per extant rules.
It is clarified that in the case of payments to persons resident outside India which are liable for
TDS i.e., other than Non –Resident (External) Account and FCNR deposits, if PAN is not
quoted by the party, TDS at the afore-said rates is to be deducted as these rates are higher
than 20%.
(ii)
Not to accept "Form 15 G/Form 15H" from any of the depositors unless PAN of the
depositor is quoted on the respective forms.
TAX DEDUCTION AT SOURCE (TDS)
The Central Board of Direct Taxes (CBDT) have since issued notification dated 31st May 2010 w.e.f
01/04/2010 modifying the time limit for deposit of TDS, issue of TDS certificates and e-filing of
TDS Returns and in the light of the same the offices are advised as under:
I. TIME LIMIT FOR DEPOSIT OF TDS & ISSUE OF TDS CERTIFICATES
(a) SALARY
TIME LIMIT FOR DEPOSIT TIME LIMIT FOR ISSUE OF TDS CERTIFICATE IN
OF TAX BY THE BANK
TDS CERTIFICATE TO THE
EMPLOYEE
For Salary credited/Paid in
the month of March
- On or before 30th April
For salary credited/ paid
other than the month of
March
By 31st May of the financial
year immediately following the
financial year in which the salary
was paid and tax deducted.
Revised FORM No. 16
to be issued Annually.
Within 7 days from the end
of the month in which tax is
deducted
___________________________________________________________________________________
35
.
(b) PAYMENTS OTHER THAN SALARY
TIME LIMIT FOR DEPOSIT OF TIME LIMIT FOR ISSUE TDS CERTIFICATE IN
TAX BY THE BANK
OF TDS CERTIFICATE
Amount credited/Paid in the
month of March
- On or before 30th April
Within 15 days from the due Revised FORM No. 16A
date
for
furnishing to be issued Quarterly.
Other cases i.e., Amount statement of deduction of
credited/paid other than in the tax i.e., TDS Return (Refer
Item 2 for Due date) .
month of March
Within 7 days from the end of
the month in which tax is
deducted
II. DUE DATE FOR FILING TDS RETURNS
The due date for furnishing TDS return for the quarter ending March has been modified to 15 th May
(from earlier June).
Accordingly, the revised due dates for e-filing the TDS returns are:
S.No.
1.
2.
3.
4.
Date of ending of the quarter
of the financial year
30th June
30th September
31st December
31st March
Due date
15th July of the financial year
15th October of the financial year
15th January of the financial year
15th May of the financial year
immediately following the financial year
in which deduction is made
(III) The offices shall continue to deposit TDS in on-line mode.
Payment of Interest for delayed remittance to IT authority
___________________________________________________________________________________
36
.
RECOVERY / NPA NORMS
 Interest and or installments of principal remain overdue for a period of more than 90 days in respect
of a term loan.
 The account remains ‗out of order‘ for a period of more than 90 days in respect of overdraft/cash
credit
 The bill remains overdue for a period of more than 90 days in case of bill purchased and discounted
 Interest and /or installment of principal remains overdue for two harvest seasons but for a period not
exceeding two half year in the case of an advance granted for agriculture purpose, and
w.e.f.30.09.04 following further amendments issued by the Apex Bank
a. A loan granted for short duration crops will be treated as NPA, if the installment of principal or
interest thereon remains overdue for two crops seasons.
b. The loan granted for long duration crops will be treated as NPA, if the installment of principal or
interest thereon remains overdue for one crop season.
(Crop season for each crop would be determined by the State Level Bankers‘ Committee in each
state)
 Any amount to be received remains overdue for a period of more than 90 days in respect of other
accounts.
 RBI to move over to charging of interest at monthly rest , w.e.f. 01.04.02
NPA CATEGORY
REVISED NORMS w.e.f. 31.03.05
Sub – standard assets
A sub standard asset would be one, which has remained
NPA for a period less than or equal to 12 months
Doubtful assets
If it exceeds a sub standard category for more than 12
months
Loss assets
No security in the account and as identified by bank/
internal/ external auditors or RBI as loss assets
 If realizable value of the security is less than 50% of what valued at the time of sanction or last
inspection, such NPA may be straightaway classified under doubtful category
 If realizable value of the security is less than 10% of present o/s, such NPA may be straightaway
classified under loss category
 Our bank has fixed `50 lakhs and above accounts as high value accounts
 All the facilities granted by a bank to a borrower will have to be treated as NPA and not the particular
facility or part thereof which has become irregular.
 The account which are running regular and are classified as standard shall not be categorized NPA
category even if any of the directors/partners are common in other accounts which have been
classified as NPA
 Restructured/Reschedule accounts – upgraded after one year subject to satisfactory performance
during the period.
 NPA accounts shall be immediately upgraded on payment of irregular portion.
___________________________________________________________________________________
37
PROVISIONING NORMS:
Rates of Provisioning for Non-Performing Assets and
Restructured Advances Category of Advances
.
Existing
Rate
Revised Rate
(%)
(%)
Sub- standard Advances:
• Secured Exposures
10
15
• Unsecured Exposures
20
25
Unsecured Exposures in respect of Infrastructure loan accounts
where certain safeguards such as escrow accounts are available.
Doubtful Advances – Unsecured Portion:
Doubtful Advances – Secured Portion:
15
20
100
100
• For Doubtful upto 1 year
20
25
• For Doubtful > 1 year and upto 3 years
30
40
100
100
0.25 to 1.00
(depending
upon the
category of
advance)
100
100
0.25 to 1.00
(depending
upon the
category of
advance)
2
• For Doubtful > 3 years
Loss Advances:
Restructured accounts classified as standard advances:
• in the first two years from the date of restructuring ; and
• in cases of moratorium on payment of interest/principal after
restructuring – period covering moratorium and two years
thereafter.
Restructured accounts earlier classified as NPA and later
upgraded to standard category
• in the first year from the date of upgradation
2
EARLY RECOGNITION OF STRESSED ASSETS
In order to identify incipient stress in the borrowal account before it turns into Non Performing Asset
(NPA), Banks are henceforth required to have three sub-categories under the SMA category as given
in the table below:
SMA SUB-CATEGORIES
BASIS FOR CLASSIFICATION
SMA-0
Principal or interest payment not overdue for
more than 30 days but account showing
signs of incipient stress
SMA-1
Principal or interest payment overdue
between 31 -60 days
SMA-2
Principal or interest payment overdue
between 61-90 days
___________________________________________________________________________________
38
.
In this aspect, Bank has laid down list of signals of financial distress/ weakening in borrowal accounts
that need to be monitored closely for recognition of Financial Distress in the borrowal accounts
Special Compromise settlement Schemes :
1. SPECIAL ONE TIME SETTLEMENT SCHEME (OTS) FOR SETTLEMENT IN ELIGIBLE NPA
ACCOUNTS WITH O/S UPTO Rs.10.00 Lac
Eligibility:The Approved Scheme shall cover all NPA accounts in doubtful or loss category
(whether non-suit filed, suit filed or decreed accounts) with Principal outstanding upto
Rs. 10.00 Lac (including amount technically written off, ECGC/ DICGC/CGFT claim
received) as on 31.03.2014 except those cases where the settlement had been
approved and the same was being honoured. Scheme valid till 31.03.2015.
2. Scheme for recovery and Full settlement in small size NPA borrowal accounts upto Rs.1.00 lac
which were NPA on 31.03.2014 will be elegible under the scheme.
Scheme valid till 31.03.2015. Branch Manager shall settle these accounts whatever maximum
amount possible.
3. Settlement Scheme for Individual NPA Accounts under Direct Agriculture category :
Eligibility : All the NPA accounts where loan was given to
individuals (other than Corporates, Institutions,
Partnership firms and trusts) which are under Direct
Agriculture Category.
Minimum indicative settlement amount : amount of
settlement will not be less than 85% of the Principal
amount.
Standard assets
The provisioning requirements for all types of standard assets stands as below. Banks should make
general provision for standard assets at the following rates for the funded outstanding on global loan
portfolio basis:
(a) direct advances to agricultural and Small and Micro Enterprises (SMEs) sectors at 0.25 per cent;
(b) advances to Commercial Real Estate (CRE) Sector at 1.00 per cent;
(c) advances to Commercial Real Estate – Residential Housing Sector (CRE - RH) at 0.75 per cent
(d) all other loans and advances not included in (a) (b) and (c) above at 0.40 per cent.
(The provision on standard assets should not be reckoned for arriving at net NPAs)
(The provisions towards standard assets need not be netted from gross advances but shown
separately as ―Contingent provision against standard assets‖ under ―Other liability & provisions
Others‖ in Schedule-V of the Balance Sheet)
Base Rate Concept:
The Reserve bank of India constituted a working group on benchmark Prime Lending Rate (PLR) to
suggest changes to make credit pricing more transparent. Based on the recommendations of the
group and the suggestions from various stake holders
System of Base Rate
1) The Base Rate has replaced the BPLR system with effect from July 1, 2010.
2) The Bank will not lend below Base Rate except to the following categories:a. DRI advances
b. Loans to the Bank‘s own employees
c. Loans to the Bank‘s depositors against their own deposits.
d. In case of crop loan up to Rs3.00lakh, for which subvention is available, the Bank would
charge farmers the interest rates as stipulated by the Government. If the yield to the Bank
___________________________________________________________________________________
39
.
(after including subvention) is lower than the Base Rate, such lending will not be construed
to be violative of Base Rate guidelines.
e. In case of export credit, if as a consequence of interest rate subvention (to specified
categories), the interest rate charged to the exporters goes below the base rate, such
lending will not be construed to be violative of Base rate guidelines. However, this rate will
be subject to a floor rate of 7%.
f. In case of restructured loans if some of the WCTL, FITL, etc need to be granted below the
base rate, such lending will not be construed to be violative of Base rate guidelines.
3) COMPONENTS OF BASE RATE:The Base rate system replaces the existing BPLR system w.e.f. 01.07.2010 and takes into
account the following factors/ components for arriving at Base rate:Base Rate = a + b + c + d
Where
a - Cost of Deposits / Funds (or any other benchmark)
b - Negative Carry on CRR and SLR
c - Unallocatable Overhead Cost
d - Average Return on Net Worth
4) The ceiling rate i.e. PLR for loans up to Rs 2 lac stands withdrawn.
5) Applicable lending rate will be arrived at by adding customer specific costs to Base Rate such as
product, tenor and credit risk premiums.
IMPLEMENTATION OF BASE RATE BY OUR BANK W.E.F. 01.07.2010
In pursuance of RBI directives to switch over to Base Rate system w.e.f. 01.07.2010. Accordingly, all
branches and Regional Offices should take note of the changes in rate of interest consequent upon
introduction of Base Rate system w.e.f. 01.07.2010
1. Documentation Aspect: As regards legal aspect of documentation in the light of Base Rate system, the Law
Department has advised to change ‗PLR‘ to ‗Base Rate‘ by hand in the documents and get
it authenticated by borrower.
 At the time of renewal the renewal sanction should mention rate of interest linked to Base
Rate and acceptance of the borrower to the said sanction be obtained.
 The supplementary agreement at the time of renewal may also indicate the rate of interest
linked to Base Rate.
Following catetories of loan could be priced without reference of BR
(a) DRI advances (b) Loans to Bank own employees (c) Loan against Bank's own deposit (d) Intt. on
subvention on crop loans (e) Intt. on subvention of export credit. (f) Restructured Loans.
Stipulation of BPLR as the ceiling rate for loans up to 2 lacs stands withdrawn.
Bank is required to review the BR at least once in quarter with the approval of the Board or ALCOs.
CENTRAL REGISTRY
Pursuant to the announcement made by the Finance Minister in the budget speech for 2011-12,
Government of India, Ministry of Finance notified the establishment of the Central Registry. The
objective of setting up of Central Registry is to prevent frauds in loan cases involving multiple lending
from different banks on the same immovable property. This Registry has become operational on
March 31, 2011. The Central Registry of Securitisation Asset Reconstruction and Security Interest of
India (CERSAI), a Government Company licensed under section 25 of the Companies Act 1956 has
been incorporated for the purpose of operating and maintaining the Central Registry under the
___________________________________________________________________________________
40
.
provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (SARFAESI Act).
The records maintained by the Central Registry will be available for search by any lender or any other
person desirous of dealing with the property. Availability of such records would prevent frauds
involving multiple lending against the security of same property as well as fraudulent sale of property
without disclosing the security interest over such property. It may be noted that under the provisions of
Section 23 of the SARFAESI Act, particulars of any charge creating security interest over property is
required to be filed with the Registry within 30 days from the date of creation.
The Central Registry has been set up for the purpose of Registration of
(a) Security interest over Property
(b) Transaction of securitization
(c) Asset reconstruction
NOTE : In all the cases where equitable mortgage is created, the same has to be first registered in
CERSAI before any disbursement of loan w.e.f 01.12.2014
___________________________________________________________________________________
41
.
DEPOSIT SCHEMES
SAVINGS BANK DEPOSIT SCHEMES
#
1.
2.
3.
4.
5.
6.
SCHEME
SALIENT FEATURES
Only for Bank‘s Staff members.
All facilities free and no charge to be levied.
SB-211(saving smart save-flexi fixed deposit)Facilities
also availableSavings Bank (Staff)
Threshold Limit Rs.25000/Minimum sweep in –Rs.5000/Minimum sweep out-Rs.2000/No Minimum Balance required to be maintained.
For salaried persons whose salary is credited in this
account.
Smart Pay
Zero balance Account. No charges for non-maintenance
Salary Accounts
of minimum balance. Also available for Wipro salary
scheme(Previous SB 213)
A/C can be opened by NRI / PIO. In Indian Rupees. Local
Funds/Funds from abroad.
Any resident going abroad for gainful employment, his
domestic account will be converted into NRO a/c.
NRO Saving Bank
If he/she does not have any domestic a/c, he/she can
A/Cs
open a NRO a/c.
Joint a/c with Residents/Non-Residents permitted.
Non-repatriable except to the extent of USD 125000 per
financial year including sale proceeds of immovable
property.
A/C can be opened by NRI / PIO. Funds from abroad. In
Indian Rupees. Any resident going abroad for gainful
NRE Saving Bank
employment can open NRE account. Joint a/c with Non
A/Cs
Residents /Residents (with some conditions) permitted.
P.A. Holder can operate the account. Freely Repatriable.
Any returning NRI who has stayed abroad can open RFC
RFC Saving Bank
a/c. In Foreign Currency- USD, GBP and Euro. Joint a/c
A/C
permitted. Freely Repatriable.
Tax Saver Scheme. Exemption from Capital Gains Tax
u/s 54, 54B, 54D, 54F and 54G of Income Tax Act, 1961
allowed. Option to open Account ‗A‘ or ‗B‘. Interest or
withdrawal from Account ‗B‘ can be made through
Account ‗A‘ only. Introduction of the depositor need not be
Saving Bank
insisted upon. Joint account not permitted. Cheque Book
Capital
Gains
facility not allowed. Withdrawal of Interest does not
Scheme
require permission from IT authority like the withdrawal of
Account ‗A‘ for SB
Principal amount.
‗B‘ for TD
Special Account Opening Form to be obtained in
duplicate.
The forms as obtained during the course of operation of
account / withdrawals /closure of accounts to be
submitted to the IT authority within 7 days of the close of
SCHEME
CODE
SB 202
SB 204
SB 205
SB 206
SB 207
SB 208
___________________________________________________________________________________
42
.
#
7.
SCHEME
SALIENT FEATURES
the month.
Average Quarterly Credit Balance Rs.25,000/Balance above Rs.25000/- will automatically be converted
into Term Deposit. Auto sweep Unit- Rs.5000/-. Reverse
Saving Smart Save
sweep unit- Rs.2000/-. 50% concession in NEFT/RTGS
Flexi Fixed
SB 211
Charges. Speed Clearing Charges – Free. Free ECS
Deposit
debit and credit. Instant credit of O/s cheque upto
Rs.25000/No Charges for Cheque Books .At par
collection of Govt. Cheques.
Initial deposit
Minimum Balance
8.
SCHEME
CODE
Basic SB Deposit
Cheque Book Facility
HO/CS&P / 44
/2012-13/527
/19.10.2012-
Cheque Collection
The new name for
Basic Banking (No
Frill)
Account
Scheme (SB-212) is
―Basic
Savings
Bank
Deposit
Account‖ (Basic SB
Deposit)
ATM Card
Number of Credits
Withdrawals
(HO/CS&P/56/201213/661/21-12-2012)
Other free Services
A nominal amount of Rs.
10/- for opening of an
Account under the ‗Scheme.
No Minimum Balance
prescribed and as such no
charges for non
maintenance of Minimum
Balance.
One Free of Cost Cheque
Book of 25 Leaves during a
Calendar Year
Cheques drawn in favour of
the account holder shall be
collected in such Accounts,
if any
Free ATM Card facility shall
also be provided.
No restriction on number of
credits in the account
A maximum of 6
withdrawals (including ATM
and Transfers) per month
are permitted, free of any
charges,. For additional
withdrawals during a month
(i.e. over and above the 6,
free of cost), Charges of Rs.
5/- per withdrawal should be
levied.
Standing Instructions for
transfer of funds within the
same branch,
No Incidental Charges for
activating the inoperative
SB 212
___________________________________________________________________________________
43
.
#
SCHEME
SCHEME
CODE
SALIENT FEATURES
account.
Other Services
ECS, NEFT, Issuance of DD
etc, are available and
applicable service charges
are levied as per bank‘s
schedule of the Charges.
( However Internet Banking
facility is not permitted
NOW NO RESTRICTIONS IN MAXIMUM BALANCE
AND TOTAL CREDITS IN THE ACCOUNTMinimum Balance
Without Cheque Book
With Cheque Book
R/
SU/U
Rs.
500/Rs.
500/-
Metro
Rs1000/-
SB 219
Rs.
1000/-
NEFT/RTGS at 50% concessional
Charges.No cheque book charges
(Including multicity cheques)Free
accidental
insurance
up
to
Rs.50,000/- (For 1st year only) after
OBC Unnati Deposit
9.
that premium for insurance
Scheme
coverage
will
be
charged
@Rs.4.50+S.Tax.Prescribedmonthly
charges are levied on nonmaintenance
of
Minimum
Balance.Locker Rent Free for Ist
Year (for new customers only)
subject
to
availability
&
depositing of 3years rent in
advance.ECS Dr/ Cr Free, I.
Banking Facility Free, Mobile & SMS
Free.
Only for Government Pensioners
Minimum Balance Rural / Semi- Urban
/
Urban
Metro
Without
Cheque Rs. 20/Rs. 20/10.
Book
SB Pension Account
With Cheque Book Rs. 250/Rs.250/(Govt)
No charges for non-maintenance of minimum balance
No Service Charges for Collection / Discount of Pension SB 220
Cheques 2 Remittances aggregating to Rs.10000/- p.m.
free of charge
Account can be opened with relaxed KYC norms
11. SB Small Account
SB 222
___________________________________________________________________________________
44
.
#
SCHEME
SALIENT FEATURES
SCHEME
CODE
The person who intends to open the account has to
produce a self-attested photograph and to affix a
signature or thumb print, as the case may be on the form
for opening the account in the presence of a designated
officer of the Bank. Balances should not exceed
Rs.50000/- in all their accounts taken together. Total
credits not exceeding Rs.1 lakh in a year and the
aggregate withdrawals and transfers in a month not
exceeding Rs.10,000/-.
Initial Deposit Amount: Rs.10/- ; Minimum Balance: NIL;
Maximum Balance in the account/s: Rs.50,000/- ;
Maximum amount per transaction- Rs. 10,000/- ; No
Cheque book facility is available. One ATM card free of
charge for the first year. Foreign Remittance not
permitted.
S B A/C for Foreign
Students studying in
12. India
HO/CS&P/65/201213/737/12.01.2013
OBC Sidhi
(Progressive
Saving Deposit
13.
Scheme)
HO/CS&P/42/201314/443/31.07.2013
14
OBC Diamond
saving deposit
HO/CS&P/55/201314/604/26-09-2013
&
HO/CS&P/45/201415/445/02-09-2014
Foreign students on study/training in India upto study
period. Zero balance, jointly not allowed. 50 cheques per
year free, 50withdrawals per half year. ATM/debit
card/internet banking/SMS-all free.
KYC-Valid
Passport/visa/two
photos/proof
of SB 223
admission/fee-receipt/declaration under FEMA/address
proof/letter
from
college
&hostel/rent
agreement/declaration about sources of credit into
accountand local cash up to Rs.5000/- per transaction.
For Women 18 & above. Jointly permitted, if women
name is first. Average daily minimum balance Rs. 1000/.PD a/c 12 m to 120 m minimum Rs.500/- and in multiple
of Rs.100/- in name of any family member name.
SB 225
Insurance cover of Rs. 1 lac free for first year. ATM/debit
card free for first year.(Charges Rs. 100/- afterwards.)
More than one PD a/c can be linked and existing SB a/c
can be upgraded to this scheme.
-Average quarterly balance-Rs.1 lac
-ATM free
-Personalized multicity cheques book-free
-Personal accident insurance cover-Rs. 5 lac free till
average quarterly balance is maintained
-Locker rent-25% discount
-Stop payment & standing instructions-free
Instant credit of local/outstation cheques after 6 months of
SB 226
opening of account-upto Rs.25000/--Rate of interestpayable with quarterly rests
-Charges for non-maintaince of 80% of quarterly balanceRs 250/-A/c can be opened by individuals(singly or
jointly).Associations.Trusts,HUF‘s,Clubs,Societiesetc
subject to domestic deposit criteria of RBI, complying
KYC Guidelines, execution of AOF with Photo, Identity
___________________________________________________________________________________
45
.
#
SCHEME
SALIENT FEATURES
SCHEME
CODE
and Address proof.
OBC Platinum
saving deposit
15
HO/CS&P/55/201314/604/26-09-2013
&
HO/CS&P/46/201415/446/02-09-2014
Additional benefits wef 05.09.2014:
-0.25% discount in ROI in Retail Loan, SME &
Agricultural
Term
Lending
subject
to
Min
LendingRate(BR)
- 0.50% discount in Process Fee Retail Loan, SME &
Agricultural Term Lending
-50% discount in DD /RTGS/NEFT
-25% Locker rent concession or Free for 1st year if 3 yrs
rent paid in advance
- Free ABB/Speed Clearing
- Internet Banking/ Mobile Banking
- Free Trf of Fund/RTGS/NEFT through I-Banking .
- Daily Withdrawal limit through ATM increased from Rs.
25000/- to Rs. 50000/- Opening of Demat account at Select Branches-Free
- No charges for A/c Statement & Balance Certificate
- No charges for Signature Verification.
-Average quarterly balance-Rs.5 lac
-ATM free
-Personalized multicity cheques book-free
-Personal accident insurance cover-Rs. 10 lac free till
average quarterly balance is maintained
-Locker rent-50% discount
-Stop payment & standing instructions-free
Instant credit of local/outstation cheques after 6 months of
opening of account-upto Rs.50000/-Rate of interest-payable with quarterly rests
-Charges for non-maintaince of 80% of quarterly balanceRs500/-A/c can be opened by individuals(singly or
jointly).Associations, Trusts, HUF‘s, Clubs, Societies etc
subject to domestic deposit criteria of RBI, complying
SB 227
KYC Guidelines, execution of AOF with Photo, Identity
and Address proof.
Additional benefits wef 05.09.2014:
- 0.25% discount in ROI in Retail Loan, SME &
Agricultural Term Lending subject to Min Lending
Rate(BR)
- 0.50% discount Process Fee Retail Loan, SME &
Agricultural Term Lending
-Free DD /RTGS/NEFT
-25% Locker rent concession or Free for 1st year if 3 yrs
rent paid in advance
- Free ABB/Speed Clearing
- Free Internet Banking/ Mobile Banking
- Free Trf of Fund/RTGS/NEFT through I-Banking .
- Daily Withdrawal limit through ATM increased from Rs.
___________________________________________________________________________________
46
.
#
SCHEME
SALIENT FEATURES
SCHEME
CODE
25000/- to Rs. 100000/- Opening of Demat account at Select Branches-Free
- No charges for A/c Statement & Balance Certificate
- No charges for Signature Verification.
16
SB DBT Deposit
Scheme
Wef-18/12/2013
HO/CS&P/74/201314/834/14-12-2013
OBC Parivaar
Saving Group
Scheme
HO/CS&P/49/201415/451 September
2, 2014
17
Scheme has been
temporarily
freezed
vide
HO/CS&P/56/201415/501 dt
19.09.2014
and subsequently
defreezed vide
HO/CS&P/70/201415/669 dated
22.11.2014
All Indian citizens entitled for Subsidy /Benefit, on
compliance of KYC Guidelines
-No initial deposit / No minimum balance/ No charges for
non maintaince of minimum balance
-One free cheque book 25 leaves
-Free ATM
-No restrictions in number of credits
-Cheques collection in favour of account holder
-Standing instructions free in same branch
-ECS/NEFT/DD issuance at normal charges
-Internet banking not permitted
-Existing SB accounts can be converted in this scheme
-Stipulation of inoperative/Dormant does not apply,
due to non-operation of the account for over two
years
-Those who can open individual OBC Savings Bank
Account can be grouped under OBC Parivaar Savings
Group Account.
- Existing account holders can also bring their family
members (Fresh Accounts) and get the accounts
grouped.
- KYC compliance of all individuals is must.
- A minimum of two accounts can be grouped under OBC
Parivaar Savings Group Account.
- The grouped family members will select the main person
of the Parivaar for Group Cust ID.
- Minor cannot be a main person for primary group ID.
Parivaar Minimum Combined Monthly Balance
(MAB):
 Metro /Urban- Rs.100000/ Semi Urban /Rural - Rs. 50000/-
SB 228
SB 230
Minimum Monthly Balance in Individual Account:
 Metro /Urban- Rs.10000/ Semi Urban /Rural - Rs. 5000/Charges for
not maintaining Minimum Combined Monthly
Balance:
 Rs. 150/- p.m. + Service Tax irrespective of Area.
For not maintaining minimum Balance in Individual
A/C.
 Rs. 100/- p.m. + Service Tax irrespective of Area.
Waiver in Minimum Balance Charges subject to an FD
of
___________________________________________________________________________________
47
.
#
SCHEME
SCHEME
CODE
SALIENT FEATURES


Rs.5,00,000/- (combined) for Metro & Urban centre or
Rs. 2,50,000/- (combined) for Semi Urban & Rural
Centre.
-Personal accident Insurance free for 1st Year (Death &
Disability-Tie Up arrangement with United India
Insurance) -1.00 lakh per person.
- Interest Quarterly payable
- Personalized Cheque book -50 leaves free in a year
- 0.25 %Concession in ROI for Retail Loans, SME &
Agriculture (Term lending) on the prevailing rate (subject
to charging of Minimum Lending rate i.e. Base Rate )
- 50% discount in Processing Fee for Retail Loans, SME
and Agriculture Term lending
- 50% discount in Demand Draft facility / RTGS/ NEFT
commission
- Transfer of funds/RTGS/ NEFT through I-banking - Free
- ATM/Debit Card (Rupay) - Free (Issuance & Renewal)
- ABB Facility/ Speed Clearing Free
- Internet Banking & Mobile Banking - Free
- Standing Instructions & Stop Payment - Free
- Locker rent for new customer (subject to availability)
Discount of 25% in the locker rent. Or Free Locker for 1st
year in case of deposit of three years advance rent is
made
- Opening of Demat Account (at Selected Branches) Free for main person of the group and 50 % discount for
others
Current Account
#
1.
2.
3.
SCHEME
SALIENT FEATURES
Minimum
Rural / Semi- Urban
/
Balance
Urban
Metro
With
Cheque Rs.250/Rs. 500/Book
Normal Current A/C
A/C can be opened by NRI / PIO. In Indian Rupees. Minimum
Balance Rs.1000/NRE Current Funds from abroad. Any resident going abroad for gainful
Account
employment can open NRE account. Joint a/c with Residents /
Non-Residents permitted.
P.A. Holder can operate the account. Freely Repatriable
NRO
A/C can be opened by NRI / PIO. In Indian Rupees. Minimum
Current
Balance Rs.1000/Account
Local Funds/Funds from abroad. Any resident going abroad for
Current
Account
(General)
SCHEME
CODE
CA 101
CA 102
CA
103
___________________________________________________________________________________
48
.
Current Account
#
SCHEME
SALIENT FEATURES
SCHEME
CODE
gainful employment, his domestic account will be converted
into NRO a/c.
If he/she does not have any domestic a/c, he/she can open a
NRO a/c.
Joint a/c with Residents/Non-Residents permitted. Nonrepatriable except to the extent of USD 125000 per financial
year including sale proceeds of immovable property.
In Foreign Currency. USD, GBP, Euro, Canadian $ and
Australian $.
CA 104
Funds from abroad. Any type of remittances coming from
abroad can be kept in EEFC A/C. Freely Repatriable.
Branches maintaining Current A/Cs of Extension Counters,
Lead Bank Offices, STCs, Spl. Collection Centres, Stationery
Godowns, Central Cash Centres, Currency Chests, Satellite
CA 105
Offices, Assets Recovery Cells, Inspectorates, Service
Branches, MICR Centre.
4.
EEFC CA
5.
Imprest
Account
6.
Banker‘s CA
7.
CA Margin Margin Money kept in C/As against issue of L/Cs, Guarantees,
CA 107
Money
etc
8.
Domestic
RFC
Scheme
Current A/Cs of Banks maintained with the Branches
Residents In Foreign Currency. Freely Repatriable
CA 106
CA 108
Flexi Fixed Deposit Average Quarterly Credit Balance
Rs.2,00,000/Balance above Rs.200000/- will automatically be converted
9.
CA 109
into FDR/CDR.
No Charges for Cheque Books. 50% concession in
NEFT/RTGS charges
Exemption from Capital Gains Tax u/s 54, 54B, 54D, 54F and
54G of Income Tax Act, 1961 allowed. Option to open Account
Current
‗A‘ or ‗B‘.
Account
Interest or withdrawal from Account ‗B‘ can be made through
Capital
Account ‗A‘ only. Introduction of the depositor need not be
Gains
insisted upon.
10. Scheme
Joint account not permitted. Cheque Book facility not allowed.
CA 111
Account ‗A‘ Withdrawal of Interest does not require permission from IT
for SB/CA
authority like the withdrawal of Principal amount. Special
Account ‗B‘ Account Opening Form to be obtained in duplicate. The forms
for TD
as obtained during the course of operation of account /
withdrawals /closure of accounts to be submitted to the IT
authority within 7 days of the close of the month.
Dividend
11.
A/Cs opened by the Companies to pay Dividend.
CA 112
Warrant CA
Current
Account
Premium
Gold - FFD
___________________________________________________________________________________
49
.
Current Account
#
SCHEME
SALIENT FEATURES
SCHEME
CODE
Minimum Balance Rural / Semi-Urban Urban / Metro
With Cheque Book Rs.1000/Rs. 2500/Free Personal Accident (Death) Insurance Cover of Rs.1 Lac
(1st year)after that premium for insurance coverage will be
charged @Rs.9/-+Service Tax
Waiver of 100% ABB Charges during the 1st year.
Pragati
CA
12.
CA 113
Waiver of Demat A/C maintenance charges for one year.
Scheme
Additional Benefits :(For A/Cs maintaining average daily CA
balance of Rs. 5 Lac or more)
Free Draft Issuance Facility, Free RTGS Facility up to Rs.5
Lacs.
(However, mandatory RBI charges plus applicable service tax
shall be recoverable).
A/C opened by our Branches/Offices for online remittance of
13. E-TAX AC
CA 117
TDS Deducted
TERM DEPOSITS
#
SCHEME
1. Fixed Deposit
Cumulative
2. Deposit
AMOUNT
5. Suvidha
Deposit
SPECIAL FEATURES
SCHEME
CODE
TD 301
(Qty. Liq.)
TD 302
(Without
Liq.)
TD 308
Diff.Intt.Rate
TD 311
FDR-Banks
TD 312 Govt
Spon
Subsidy
TD 303
TD 309
Diff.Intt.Rate
TD 310
Court Claim
Minimum
Rs.100/-
07 days to
120 months
Interest Payable Quarterly
Multiples of
Rs.100/-
6 months to
120 months
In multiples
of 3 months
Quarterly Compounding
Lump Sum payment on maturity
At Call
Issued in favour of beneficiaries
on account of applicants
Zero Interest
TD 304
12 months to
120 months
Interest is paid on Monthly
basis.
Principal paid on maturity.
TD 305
12 months to
120 months
Partial withdrawal in multiples of
TD 306
3. Call Deposit
Monthly
Income
4. Deposit
PERIOD
Amount is
accepted so
that Monthly
Income is in
multiples of
Rs.10/Minimum
Rs.2000/-
___________________________________________________________________________________
50
.
TERM DEPOSITS
#
SCHEME
AMOUNT
PERIOD
In Multiples
of Rs.1000/-
Capital Gains
Scheme 1988
6. Account ‗A‘
for SB/CA
Account ‗B‘
for TD
7. NRE
8. NRO
In Indian
Rupees.
Funds from
abroad.
In Indian
Rupees.
Funds Local/
from abroad.
1 to 10 years
As
applicable to
domestic TD
SPECIAL FEATURES
units of Rs.1000/- allowed.
Remaining units continue to
earn interest at Contracted
Rate.
Exemption from Capital Gains
Tax u/s 54, 54B, 54D, 54F and
54G of Income Tax Act, 1961
allowed.
Interest or withdrawal from
Account ‗B‘ can be made
through Account ‗A‘ only
Introduction of the depositor
need not be insisted upon.
Joint account not permitted.
Withdrawal of Interest does not
require permission from IT
uthority like the withdrawal of
Principal amount. Special
Account Opening Form to be
obtained in duplicate. The forms
as obtained during the course of
operation of account /
withdrawals /closure of
accounts to be submitted to the
IT authority within 7 days
A/C can be opened by NRI/
PIO.
Any resident going abroad for
gainful employment can open
NRE account. Joint a/c with
Residents not permitted
(conditional). Joint a/c with NonResidents /Residents (with
conditions) permitted.
Freely Repatriable. Exempted
from all taxes.
SCHEME
CODE
TD 313-FDR
TD 314-CDR
TD 321-FDR
TD 325-CDR
A/C can be opened by NRI/
PIO.
Any resident going abroad for
gainful
employment,
his
TD 322/323domestic account will be
FDR
converted into NRO a/c. If
TD 324-CDR
he/she does not have any
domestic a/c, he/she can elect
to open a NRO a/c.
Joint a/c with Residents/NonResidents permitted.
Non-repatriable except to the
___________________________________________________________________________________
51
.
TERM DEPOSITS
#
SCHEME
AMOUNT
PERIOD
SPECIAL FEATURES
SCHEME
CODE
extent of USD 125000 per
financial year including sale
proceeds
of
immovable
property.
No Tax exemptions.
9. FCNR (B)
Funds from
abroad.
In Foreign
Currency
USD, GBP,
Euro,
Canadian $
and
Australian $
& Japanese
yen.
10. RFC
Funds from
abroad.In
oreign
Currency.US
D, GBP,
Euro,
Canadian $
and
Australian $.
Progressive
11. Deposit(PD)
OBC Adhaar
12. (VPD)
Multiples of
Rs.10/-
Core
monthly
installment
in Multiples
of Rs.10/Maximum
Rs.50,000/-
Minimum 12
months
Maximum 5
years
Minimum 12
months
Maximum 5
rears
6 months to
120 months
(In multiples
of 3 M)
12 months to
120 months
A/C can be opened in TD only
by NRI/ PIO. Any resident going
abroad for gainful employment
can open FCNR (B) account.
TD 331-FDR
Joint a/c with Non Residents/
TD 332-CDR
Residents
(close
relative)
permitted.
Freely Repatriable.
Exempted from all taxes.
Any returning NRI who has
stayed abroad can open RFC
a/c.
Joint a/c permitted/Freely
Repatriable.
Amount is deposited in monthly
Installments.
Lump Sum Payment on
maturity.
Amount of monthly Installment
may vary up to 10 times of the
Core Amount or Rs.50,000/whichever is less. Lump Sum
Payment on maturity.
Loan facility – 95% of Accrued
value
TD 333-FDR
TD 334-CDR
PD 315
PD 316
___________________________________________________________________________________
52
.
TERM DEPOSITS
#
SCHEME
AMOUNT
PERIOD
Operative
Accounts
Flexi Fixed
13. Deposit
Min. avg.
quarterly
balance
Rs.
SB Smart
Save-SB
211
CA
Premium
Gold/-CA
109
SCHEME
CODE
SPECIAL FEATURES
Auto
Sweep
Unit
Rs.
Reverse
Sweep
Unit
Rs.
25,000/-
5000/-
2000/-
200,000/-
25,000/-
25,000/-
Penal
ty /
qtr for
min.b
al.
Rs.
150/-
1000/
-
Period of
FFD
TD376/382 FDR
90
days –
5 years TD 379 FDR
45
day to 1
1Year
IT PRODUCTS OF OUR BANK
CATEGORY
On site ATMs
Offsite ATMs
Mobile ATM‟s
Total ATM‟s
Total Outlets
31.03.2012
932
331
7
1270
3042+19(EC)
31.03.2013
1087
365
1452
3452
31.03.2014
1754
361
13
2128
4254
POS Terminal
1201
1355
1659
31.12.2014
2085
370
13
2468
2194 branch
+2466
ATM‟s=4662
1816
IT PRODUCTS & SERVICES
Product
ATM Card Base
Customer
Registered for SMS
Alert
I banking
customers
Mobile
Banking
Customers
Fig in Lac
31.12.2014
68.09
55.91
31.03.2012
32.71
24.81
31.03.2013
39.09
36.77
31.03.2014
49.71
46.64
4.46
5.57
6.67
7.87
0.19
0.35
0.55
0.76
Circular no. HO/DIT/ATM/5/2014-15/88 8th May, 2014, it has been circulated to Use
Standardized font in official correspondence and documentation .
All official documents should henceforth have the standardized Font viz. Arial with Font size of
12 and Single Line Spacing.
___________________________________________________________________________________
53
.
ATM Based Services
Cash Withdrawal - The cardholder can withdraw cash from our Bank‘s ATMs or the ATM of other
member banks of ATM consortium viz. VISA and NFS.
The maximum permissible amount of cash withdrawal per day is Rs.25,000/- .
The maximum limit per withdrawal is Rs.25,000/- on our Bank ATM and Rs.10,000/- on other Bank
ATMs.
For International GOLD VISA Debit Card
1. Daily cash withdrawal and POS Limit:Rs.50,000/- each.
Fast Cash - The cardholder can withdraw cash as per pre-defined amount. This option is available for
customer on our Bank ATM only where customer may select out of four option for withdrawal of cash
i.e Rs. 1000/- Rs. 2000/- Rs. 3000/- and Rs. 5000/- and the ATM dispenses the cash accordingly.
Through this option, customer need not enter amount, thus makes the cash withdrawal faster, and is
therefore called FAST CASH. The maximum withdrawal limit is same as in point (i) above.
Balance Inquiry - The balance in the account can be viewed through the ATM.
Mini Statement - The cardholder can obtain the statement containing last 5 transactions in the
primary and secondary account alongwith details of available balance.
Change of PIN - 'Change PIN' option can be used by the cardholders at the OBC ATMs to change the
PIN of their Cards as and when desired by them.
Fund Transfer - Card holder can transfer fund between the accounts linked in the card. In order to
perform Fund Transfer, cardholder has to select from and to account number and enter the amount he
wants to transfer.
Cheque Status Inquiry - Cardholder can use the ATM to inquire the status of the Cheques issued in
his account.
Stop Cheque Payment - Cardholder can stop the cheque payment in his account using this ATM.
TAX Payment through ATM's - Now Cardholders of Orienatl Bank of Commerce can register
themselves for Income Tax payment through ATM and can make the payment of Income Tax through
any of our Bank's ATM. The limit for maximum permissible amount is Rs. 1.00 lac per day.
MOBILE BANKING REGISTRATION & DEREGISTRATION - CARDHOLDER CAN REGISTER AND DEREGISTER THE
MOBILE BANKING FACILITY.
SMS ALERT SERVICE REGISTRATION/CHANGE IN MOBILE NUMBER FOR SMS ALERT
The customers can avail SMS Alert services by registering the mobile no through ATM.
ATM Cards - Our Bank is presently offering following types of ATM cards to our customers:
ATM cum Debit Card –International debit Card
It can be used both at Point of Sale (POS) terminals and ATMs.
It is a global card and is accepted across the globe at ATMs or POS with ‗VISA‘ logo.
All Savings Bank and Current Account holders in individual category are offered our Card.
On 14 Jan 2013 the bank has conversion of existing ATM card to ATM cum debit cards and
issuance of ATM cards with POS facility in future by default.
The customers who do not want additional POS facility on their ATM cards have been requested
to send their intimation to the Bank on [email protected] or through Toll Free Nos. 1800-180-1235.
i.
VISA International Gold Debit Card ( 10/12/2013)
Any ATM Card holder who have used their card at least once in foreign locations is eligible for
this gold Card .
1. Daily cash withdrawal and POS Limit:Rs.50,000/- each.
___________________________________________________________________________________
54
.
2. Add on Gold Debit Card where Primary Card is Gold Debit Card.
3. EMV( chip Based) cards also provides interoperability with the global payments
infrastructure– consumers with EMV chip payment cards can use their card on any EMVcompatible payment terminal.
4. One time Issuance charge ofRs.100/- and Annual Charges –Rs.500/-.
ii. ATM card for School/College Students – Cashmate Card
This card is issued in the SB ―Vidyarthi‖ Scheme (Code SB 217 - now scheme closed)
This Card also offers overdraft facility up to Rs.1500/- to the Card holder students to meet their
emergency, unforeseen expenses like Books, Stationary etc.
This card is an ATM cum debit card. It is VISA international Card.
Mode of operation 14 is permitted for this scheme.
iii. ATM card for Farmers – Oriental Green Card
This card is a ATM cum debit card.
This is issued in the A/c‘s under Green Credit Card (GCC) Scheme and Oriental Green Card
(OGC) Scheme i.e. OD511 and CC404.
IV Rupay ATM cum Debit cards and kisan Card
RuPay is the Indian domestic card payment network set up by National Payments Corporation of
India (NPCI) at the behest of banks in India.
Such arrangement would help Indian Banks to cut down on their highly paid membership fee to
International consortiums such as VISA, Master and American Express
which shall be issued to the customers of the Bank through Ready Kits as well as Personalized
Cards
The RuPay cards can be issued as Primary card as well as Add-on card in addition to existing
VISA Cards, through DCREQ
Eligibility criteria for Rupay ATM cum Debit card issuance and validity period of card shall remain
the same as is applicable for existing ATM-cum-Debit card
The annual charge on Rupay ATM cum debit card is nil
Interbank ATM Usage Facility
As of now, our Bank‘s card holders can perform Cash Withdrawal and Balance Inquiry on the ATMs of
member banks of ATM sharing consortiums viz. VISA and NFS. Similarly the cards of other member
banks under these consortiums are accepted on all our ATMs and they can perform Cash Withdrawal
and Balance Inquiry operations. As per RBI directives the maximum cash withdrawal from ATM by
customer of other bank is limited to `10,000/- per transaction.
Our customers who do financial and non financial transactions on other Bank‘s ATM and other Bank‘s
customers who do financial and non financial transactions on our Banks ATM shall be charged Rs
20.00 on Financial Transaction and Rs 9.00 shall be charged for non financial transaction viz balance
inquiry, mini statement and PIN change from the 6th transaction onwards( 5 Transactions are Free*).
These directives effective from July 01, 2011.
The number of mandatory free ATM transactions for savings bank account customers at other
banks’ ATMs is reduced from the present five to three transactions per month (inclusive of
both financial and non-financial transactions) for transactions done at the ATMs located in the
six Metro centres, viz. Mumbai, New Delhi, Chennai, Kolkata, Bengaluru and Hyderabad.
Daily Transaction Limit: Visa Card and Repay card
i. Total daily cash withdrawal limit from an account - `25000/ii. A customer can withdraw upto `25000/- in a day from our Bank ATM.
iii. A customer can withdraw upto `10000/- in a day from other Bank‘s ATM.
___________________________________________________________________________________
55
.
iv. A customer can purchase upto `25000/- in a day at POS through our ATM cum Debit card. If it
is a Gold Card then limit is Rs. 50000/- per day.
ENABLING PIN PROMPT FOR POINT OF SALE (POS) TRANSACTIONS.
As per the circular DIT dt 13.03.2013 the bank has made PIN as mandatory for doing transaction
through POS terminals through ATM cum Debit Cards. The PIN value would be same as being used
for undertaking ATM transactions.
RBI guidelines, all banks need to comply with this guideline by June 30, 2013 the customers may
come across POS machines of other Banks wherein POS machines are not
compliant for accepting PIN value and at such terminals the transaction would be
approved as signature based transaction as is being done in current scenario.
1. Eligibility Criteria
Any customer having a Savings Bank / Current Account / Over Draft A/c in his / her individual
capacity and not in the representative capacity, Staff OD accounts. The request for ATM card is
given through DCREQ option in Finacle.
The following instructions /guidelines must be followed for issuance of cards:
i.
Card can be issued to a customer provided his/her age is 14 years or more and he/she is a
literate. Following customers are not eligible for issuance of ATM / Debit Card:
i) Customers below 14 years of age
ii) Illiterate
iii) Insolvent
iv) Persons operating accounts in representative capacity
ii.
The maintenance of primary account is compulsory for issuance of the cards. The primary
account refers to the customers account selected by the customer for debiting the withdrawals in
the normal course.
iii.
No minimum deposit/balance in SB account for the Cards is required for issuance of cards,
though the minimum balance norms prescribed as per existing guidelines applicable to these
account will continue to be in force.
iv. Issue of Cards in joint accounts of the individuals having operational clause as ‗Operation Jointly'
is not permitted.
v.
Issue of Cards is permitted in joint accounts of individuals provided the applicant has an
authority to operate the account singly. However, all the joint account holders should authorize
the applicant to avail the facility by counter signing the application.
vi. All the transactions arising out of the use of the Card/PIN allotted to the authorized customer of
the Joint Accounts, shall be binding on all the Joint Account Holders concerned jointly and
severally. In case the Bank subsequently receives instructions contravening the accepted
mandate of the Joint Account Holders, the Card will be blocked immediately under advice to the
concerned account/ card holders.
vii. The Cards will also be issued to NRI customers in their NRE accounts. At present Cash Deposit
facility is offered through our selected ATMs. Cash deposited by NRI customers in the ATMs will
be credited to their accounts as per RBI/ FEMA guidelines issued from time to time.
viii. The persons with blindness, low vision, and other disabilities are offered all banking facilities
such as cheque book including third party cheques, ATM facility, Net banking facility, locker
facility, retail loans and Credit Cards etc. without any discrimination
ATM-cum-Debit cards can also be used for conducting online transactions w.e.f 10/11/2010VBV registration (Requirements for availing Verified By VISA service)- OBC Debit Card should have
CVV values. OBC Debit Card is enabled for POS i.e. should be full limit card. OBC Debit Card holders
mobile no is enabled for SMS alert service.
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56
.
2. Chargeback Procedure for resolution of cardholder‟s complaints
The customers using their OBC Cards can perform transactions through Bank‘s own ATM network
as well as ATMs of other bank‘s having ATM sharing arrangement with MITR / NFS / VISA thereby
giving them access to a vast network of 10 lac ATMs globally for operating their account. The
Proton Card of our Bank is an International VISA Debit card which can also be used at POS
terminals to make payments through cards. In this case the card holder‘s primary account linked
with the card is debited online.
Issuer or Card Issuing Branch: An issuer is a Bank (in case of other Bank card) or branch (in
case of Bank‘s own card) who is issuing the card and with whom customer has his / her account.
Acquire or Acquiring branch / ATM/ POS: An acquirer is a Bank (in case of other Bank‘s
ATM/POS) or branch (in case of Bank‘s own ATM/POS) on ATM / POS the transaction is done.
This is also further referred as Acquiring Bank, Acquiring Branch and Acquiring ATM/POS.
What is Charge Back?
Some time the transaction carried out by the cardholder is not completed or partially completed
and may not get matured due to various reasons including power fluctuation, delay in data signals,
network speed or delay in response from the Bank‘s host server etc.
Depending upon the status of the transactions system automatically rollback most of such
incomplete transactions. However status of some of the transactions if found in the doubtful stage
does not get rollback and through investigations the status of cash dispensation is then
ascertained from ATM where such disputed / doubtful transaction was carried out.
Problems and customer complaints specially related to non-dispensing or short dispensing of
cash, wrong debit in account, dispensing of cash and wrong reversals to customer account etc
need to be appropriately raised on Card Operation Centre (COC), Secunderabad by the card
issuing branch of the customer with required details of such transactions. It is the responsibility of
the Card Operation Centre (COC), Secunderabad to resolve such complaints and sent necessary
advice to the branches. This mechanism is called chargeback.
Types of Chargeback‟s
1. Inter Bank Chargeback
i) Chargeback raised by US:
Under the following circumstances the charge backs will be raised by us.
a. Dispute with regard to our customer a/c debited but cash not received.
b. Dispute with regard to cash dispensed by our ATM to other bank card holder but not
reimbursed through settlement.
c. Dispute with regard to our customer a/c debited in respect of merchant transaction at
POS terminal
ii) Chargeback raised on US:
Under the following circumstances the charge backs will be raised on us.
a. Cash received by our card holder for the transaction done at other Bank ATM but not
reimbursed to other bank through settlement due to the reason that our cardholder‘s
account is not debited or transaction is reversed at our end.
b. Dispute of other bank cardholder about non-dispensation of cash at our ATM
c. Successful Merchant transaction of our cardholder at a POS terminal but not
reimbursed to other bank through settlement due to the reason that our cardholder‘s
account is not debited or transaction is reversed at our end.
2. Intra Bank Chargeback
Disputed ATM withdrawal transaction done by the cardholder of our bank at our own ATMs
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57
.
Re-presentment: Some time the debit transaction pertaining to cash already withdrawn by the
card holder gets reversed by crediting the customer‘s account either by the system or as part of
wrong settlement entry. In such cases the acquirer branch / bank may represent such cases and
may claim the amount and ask to correct such accounting entries. This mechanism is called Representment.
SBI-Oriental Bank of Commerce Co-branded Credit Card - Bank has entered into an MOU with SBI
Cards and Payments Services Private Limited (SBICPSL) on 22.09.2011 for issuing Co-branded Credit
Cards to our employees and customers.
The cards shall be issued in two variants as under 1.Secured 2.Unsecured
Secured Cards shall be issued against the lien marked on the Term Deposit of the customer. Only
Credit Card Cell at Head Office is authorized to mark/ lien for SBI-OBC Secured Credit Card
.Unsecured Cards shall be issued without any security.
Annual Charge :- Rs 500 for Gold card and Rs 3000 for Platinum card.
Note:
1. The Email Id [email protected] needs to be referred only by the Branch Managers &
Oriental Bank of Commerce officials .
2. The Email Id for the SBI- Oriental Bank of Commerce customers remains [email protected]
Note -1. ATM Helpdesk no toll free no 1800345-242 merge with no 1800-180-1235
2. It is observed that only 31.48% of total transactions are being carried out through ADCs.
Internet Banking Services
Internet Banking enables a customer to perform basic banking transactions through Internet from
anywhere in the globe. It is available 24 hours a day, 365 days a year and account can be operated
anytime / anywhere as per customer convenience. Customers should use Internet Explorer version
7.0 or later version for accessing IBanking.
Our Bank is offering two types of Internet Banking:
Retail Internet Banking (https://www.obconline.co.in): For individual customers. The customer
can opt for either Enquiry only facility or Transaction facility. It can be offered to any Saving/
Current/ CC/ OD account holders. Only Query based facilities shall be provided to jointly operated
accounts. Transaction facility shall not be provided for such accounts.
Corporate Internet Banking (https://www.obconline.co.in/corp): For institutional Customers/
Big Corporates. This has features like Mass upload of Salary, Online RTGS & NEFT, Online trade
finance requests – request for LC opening, BG issue, Bill lodgment etc, Feature of
Maker/Checker, Feature of Role definition, Feature of adjusting/defining various limits by
corporate administrator itself etc.
Bank has implemented Second Level of Authentication i.e. OTP ( One Time Password ) for Net
Banking Transactions, which is sent to Registered Mobile & Email Ids.
Some of the facilities offered are:
o Accounts Related Operations:
Online Balance Inquiry, View transactions, Statement of Account – For a given period,
Cheque Status Inquiry, Clearing Instruments Inquiry, Stop Payment of Cheques etc.
o Fund Transfer Operations:
Funds Transfer to own accounts, Intra Bank Fund Transfer (to other accounts of OBC), Inter
Bank Fund Transfer (To accounts of other banks through NEFT/RTGS).
the NetBanking customers shall be able to make Loan EMI payment to their own Account as
well as to 3rd Party Loan Account using ―Transfers >> Third Party Transfers within Bank‖
Option.
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58
o
o
.
Payments:
External Payments like LIC of India for Premium Payments, IRCTC for Railway Reservation,
DB (Intt) Stock Brokers Ltd and Sharekhan for Funds Transfer Facility for Shares Purchases,
Payment of Direct Taxes, Payment of Telephone / Mobile / Electricity bills etc.
Functionality To Open Online FDR/CDR (e-FDR/e-CDR)
The NetBanking customers shall be able to open Online FDR/CDRs using ―Requests >> eFDR/e-CDR‖ Option since October 2012
The facility to create online e-FDRs/ e-CDRs using Retail NetBanking facility has been
activated only for customers where mode of Operation of the Account is ―Self‖,‖Either or
Survivor‖ or ―Former Or Survivor‖.
Customers are able to open online FDRs / CDRs with the following scheme codes
1. CDR(Cumulative) – TD303
2. FDR Without Liquidation (Fixed Deposit) – TD302
3. NRE CDR – TD325
4. NRO TDR – TD324
5. NRO FDR – Non Liquidation – TD323
o
Functionality to open tax saving CDR
a new functionality has been implemented in NetBanking system using which Retail
NetBanking Customers shall be able to create Online Tax Saving CDRs belonging to scheme
TD-341. Entering PAN number is mandatory for this scheme and PAN number must be preregistered at branch office
Deposit amount is minimum 5000 to 100000 (multiple of 100) and period is 60 month to 120.
o
Online Share Trading in Collaboration with IDBI Bank
o
Request for Issuance of Cheque Book, PO/DD
NetBanking Customers can also put in their request for issuance of Cheque Book, and
Demand Drafts, which are processed at backend by the Relationship Manager.
In addition to above, recently introduced following additions in features of Internet Banking:-
(i) Funds Transfer limits have been increased to Rs.3/- lacs per transaction and Rs. 5 lacs per
day.
(ii) Internet Sign on and Transaction Password expiry limit has been reduced from 365 days to 90
days, to make it more secured.
NetBanking facility is based on the unique Customer-Id assigned to customers, while opening the
account(s) for the first time. The NetBanking facility uses Customer – ID to automatically links all the
accounts of a customer and facilitate Account related operations viz. Inquiry for account balance,
transactional details and to perform various financial transactions. In case, the customer is maintaining
accounts with different Customer Ids, then the Branch may modify the Cust. Id (by using Finacle
―CCA‖ option) of additional accounts. The Cust.Id should be same as of the Main Operative Account
of the Customer. By doing this, all accounts linked with the common Customer Ids will be reflected
automatically in the Internet Banking Application.
Internet Banking facility can be availed by NRI customers also by filling the Internet Banking
application form and sending it to the branch where they are maintaining their account.
The request for retail Internet Banking facility also is registered using the DCREQ menu option in
Finacle. The detailed procedure is given later. Once the entry is made in the DCREQ menu, the
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59
.
Internet Banking Cell at Secunderabad shall download the data of such customers and generate their
respective User-IDs and Passwords. User-Id letters will be printed by Internet Banking cell,
Secunderabad and shall be delivered to Customer‘s address as mentioned in the Internet Application
Form. Sealed Passwords will be sent to concerned branches only. Customers will be instructed in
their letters to collect the same from branch only.
In case customer forgets Ibank password, the pin reissue should be register in Ideas software.
As per the DIT circular dt 02.08.13 Ibank has developed new functionality to deliver the NetBanking
passwords to customer‘s mobile number instantly, which are registered with Bank for SMS Alerts
facility. This functionality is in addition to existing system of delivering the password via Courier.
Request for „Add-on‟ User.Id for Joint Accounts: After obtaining written request from the Customer
and verifying their credentials, Branch Head should give email request to the Internet Banking cell,
Secunderabad ([email protected]) and provide full particulars of the Customer for generation of
additional User Id(s). They should provide details viz. existing User.Id, Account Type & No., Account
holder name and Mode of Operations, Delivery address etc.
ASBA - APPLICATION SUPPORTED BY BLOCKED AMOUNT:ASBA is an application for subscribing to an issue (IPO/Right issue) and the new initiative of SEBI for
the welfare of Investors, containing an authorization to block the application money in a bank account
maintained with Self Certified Syndicate Bank (SCSB). SCSB is a bank which offers the facility of
applying through the ASBA process. ASBA is gaining importance day by day and the customers are
demanding this facility. It is beneficial to both the customers as well as the Bank because the amount
remains in the bank account of the customer till allotment is finalized and actual amount equal to
allotted shares is only debited instead of total application amount. It helps the Bank not only to retain
existing customers but also to attract new customers.
Under ASBA process, an ASBA investor shall submit an ASBA physically or electronically through the
internet banking facility, to the SCSB (designated branch) with whom the bank account to be blocked,
is maintained. The SCSB shall then block the application money in the bank account specified in the
ASBA, on the basis of an authorisation to this effect given by the account holder. The application
money shall remain blocked in the bank account till finalisation of the basis of allotment of the issue or
till withdrawal/ failure of the issue or till withdrawal/ rejection of the application, as the case may be.
The application data shall thereafter be uploaded by the SCSB (Controlling branch) in the electronic
bidding system through a web enabled interface provided by the Stock Exchanges.
NOTE : ALL THE BRANCHES ARE AUTHORISED FOR ASBA
Mobile Banking
Mobile phones as a medium for extending banking services have off-late been attaining greater
significance. The rapid growth in users and wider coverage of mobile phone networks have made this
medium an important platform for extending banking services to customers. Bank has launched
Mobile Banking facility using which customer will be able to make Fund Transfer and also information
based services such as SMS Alerts, Balance Inquiry etc.
OBCmPay – Launched vide HO/ DIT / 40 /2009-10/ 822 dated 20.02.2010
The ever expanding network of Mobile Phone users, which has crossed the 600 million mark, has
opened up new vistas for the Bank to expand the Banking Services through the channel of Mobile
Phones. Our Bank have rolled out the latest IT enabled services named ―OBCmPAY‖ for the
customers of our Bank, which can be availed by them using their mobile phones.
RBI Guidelines
 RBI has come up with its guidelines on Dt. 20.10.08 and further on 24.12.09, some of the
important guidelines are given below-
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60
.
 The services shall be restricted only to customers of banks
 The guidelines issued by the Reserve Bank on "Know your Customers (KYC)", " Anti Money
laundering (AML)" and combating the Financing of Terrorism (CFT) from time to time would be
applicable to mobile based banking services also.
 Customer complaints/grievances arising out of mobile banking facility would be covered under
the Banking ombudsman scheme 2006( as amended up to May 2007).
 Banks are permitted to offer this service to their customers subject to a daily cap of Rs
50,000/- per customer for all types of transactions summed together.
Prerequisite: Any Customer of Bank having Java enabled Mobile phone irrespective of the Mobile
Service Provider viz. Airtel, MTNL, Vodaphone, VSNL, Idea, Reliance etc., can avail this service.
Services offered through Oriental Bank‟s Mobile Banking Services
• Account Balance Enquiry
• Mini Account Statement
• Intra Bank Fund Transfer
– Mobile to Mobile
– Mobile to Account
• Inter Bank Fund Transfer through NEFT
• ATM Locator
• Branch Locator
• Chq Status Inquiry
• Chq stop payment
customers can make payment to various types of merchants :Mobile top-up / DTH top-up (Oxi
Cash etc.) ,Insurance premium payment for selected companies,Online shopping,Over-the-counter
payments , Fees payments to schools / colleges / universities ,Payment of Electricity Bills and other
Utility Bills payment,Travel & Ticketing for Railway (IRCTC ) and Air
Registration: The customers can avail OBCmPAY services by registering either by visiting the
Branch and submitting the form or by registering through ATM. Command is MOBNKRQ. Customers
can alternatively visit any ATM of Oriental Bank of Commerce and register themselves using their
debit card.
InterBank Mobile Payment Services (IMPS): NPCI (National Payments Corporation of India) has
launched the facility of IMPS (Interbank Mobile Payment services) for integrating Mobile Banking
Services being offered by various Banks through National Financial Switch(NFS) network.
This new facility enables instant Inter Bank fund transfer and credit to beneficiary‘s account round the
clock on all days
Customers not registered for Mobile Banking services can receive fund to their account through this
service by registering for SMS Alert application and retrieving MMID (Mobile Money Identifier)
by sending SMS ―MMID‖ to the number 9223173923 Remitter.
LAUNCH OF NUUP BASED MOBILE BANKING
National unified USSD ( Unstructured Supplementary Service Data )platform basedf mobile banking
was launched .
In the earlier Mobile Banking, customer have to install Mobile Banking Application on their Mobile
Phones to avail the facility and is restricted to the customers having smart phones / advanced phone
instruments. This prevent users having basic phone instrument from availing Mobile Banking Services.
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61
.
NUP platform obviates the need for installing application on the mobile phone and enabled users
having basic mobile phones also to use mobile Banking .
The customer need not to have a GPRS or any other data connection on their mobiles. They can use
the services from any GSM mobile which has a calling capability . further NUUP does not require any
JAVA of software to be downloaded on the mobile . It can work on even the basic GSM Mobile. CDMA
mobiles are presently not supported.
SMS Alerts
SMS alerts are mandatorily for all card based / Net Banking transactions
The Bank‘s SMS Alert Services are capable of enabling only interested customers and for those Alerts
as selected by them. Any Customer of Bank having Mobile phone irrespective of the Mobile Service
Provider viz. Airtel, MTNL, Vodaphone, VSNL, Idea, Reliance etc., can avail this service.
These services are of two types i.e. Push Based Alerts and Pull Based Alerts:
Push Based Services: These Services facilitate automatic transmission of SMS to the customer‘s
chosen mobile number for various transactions in his account and cover following:• Credit/ Debit alerts for amounts specific to individual customers.
• Cheque clearing intimation alerts
• Weekly balance alerts to all/ specific accounts
• Transactions happened through various delivery channels viz. Internet Banking, ATM etc.
Pull Based Services: These services enable the customer to initiate request from his mobile to a
designated number for availing various facilities, which are as below:o Account Balance for one/multiple accounts, if any
o Mini Statements
For availing the above Pull Based services the customer has to send an SMS with the following key
words followed by the account number to Mobile number 09915622622.
Key Word
Service
ACBAL
Account Balance
STM
Mini Statements
i.
The Customer has to bear the normal outgoing SMS charges as per the tariff applicable to his
mobile connection. However, initially no Bank Charges are being levied for these Services.
‗The customers having valid ATM card can register their mobile numbers from any of the
Bank‘s ATMs by using following menus:
‗Other Requests‘ ‗Services for IT Products‘  ‗SMS Alert Registration‘.
.
Process flow for enabling the customers for”OBC SMS Alert Services”: The command for
enabling SMS Alert is SMSRQ.
1. For new customers, the customer should have opted for SMS by ticking in the SMS Alert option
column in the account opening form O.F.-1B. For old customers, separate SMS Banking
Application form should be obtained.
2. Branch must ensure that the customer is fully authorised to make query or conduct transactions on
the accounts mentioned in application form. For this ―Mode Of Operation‖ of the account must be
checked carefully.
3. Use SMSRQ Menu option of the Finacle, and enter the Mobile Number, Account number,
threshold limit for receiving alerts and other details of the Customer.
4. While keying in the Mobile Number please do not prefix any thing before the Mobile Number. The
system automatically prefixes‘91‘ after commiting of the record.
5. Press „Y‟ in front of various Options for enabling Customer for particular type of Alert.
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62
.
6. To Commit the input, type C and press F4 key.
After committing the SMSRQ operation in FINACLE, the ―SMS Alerts‖ Application shall automatically
start generating SMS for the type of transactions opted by the customer.
Note : wef 01-02-2014 bank will charge Rs.15/- per quarter for SMS Alert Facility.
Name of Event
Frequency
Remarks
1
Card Based Transactions Real Time
Irrespective of any amount
(ATM)
2
Instrument based or cash Real Time
Credit >=Rs. 10000.00 and Debit
transactions)
>=Rs. 5000.00
3
Fortnightly Balances Other 2nd
&
transactions
Sunday
tehmonth
4
5
6
7
8
Deposit Maturity
Loan EMI Notice
Minor to Major
Aadhar Seeding Activation
Internet
Banking
:
Beneficiary Addition/OTP
Internet Banking – OTP
(One Time Password )
Mobile Banking
Cheque
Book
Request/Cheque
Presented/Returned
Welcome message on
account opening
CC/OD accounts becoming
SMA
Promotional Message
On every NEFT/RTGS
Transaction
Everyday
Monthly
Everyday
Real time
Real Time
4th 
of

Maintaining Balance of Rs.
25000.00 or above for SB & CA
Staff A/c get the Balance
confirmation irrespective of
balances.
 All
registered
customers
maintaining Cash Credit /
Overdraft accounts.
2 Days before maturity
2 days before the month end
Attaining 18 years of age
Real Time
Real Time
Real Time
Everyday
Everyday
On Demand
Real time
Outward for each transaction and
inward as peer limit set in Finacle
for every V\Credit/Debit entry
Real Time Gross Settlement (RTGS)
RTGS system is a funds transfer mechanism where transfer of money takes place from one bank to
another on a ―real time‖ and on ―gross‖ basis. This is the fastest possible money transfer system
through the banking channel. Settlement in ―real time‖ means payment transaction is not subjected to
any waiting period. The transactions are settled as soon as they are processed. ―Gross settlement‖
means the transaction is settled on one to one basis without bunching with any other transaction.
The customer has to just fill up the application form to take advantage of economical, instant and
secure transfer through RTGS available across all branches of the Bank. The remitting customer has
to furnish the following information to the bank for effecting a RTGS remittance:
1. Amount to be remitted
2. His account number which is to be debited
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63
3.
4.
5.
6.
7.
.
Name of the beneficiary bank
The IFSC code of the receiving branch
Name of the beneficiary customer
Account number of the beneficiary customer
Sender to receiver information, if any
RTGS is used for both customer transactions and Inter Bank Transactions. The Operating session for
RTGS Transactions at Branches is given hereunder:
( HO DIT CIRCULAR – HO/DIT/34/2014-2015/843 dated 21/01/2015 )
Customer Transaction (R41)
Monday to Friday – (8.00 hrs to 16.15 hrs.)
Saturday – (8.00 hrs to 13.45 Hrs)
Inter-Bank Transaction (R42)
Monday to Friday – (8.00 hrs to 19.30 Hrs)
Saturday – (8.00 hrs to 14.45 Hrs)
This cut-off time is for the messages to reach at RBI end. Therefore branches should maintain
a cushion of at least 20 to 30 minutes to avoid any rejections in message transmission.
If the transaction fails for any reason, the amount will be credited back to the account from
which the transaction was made( Through Nodal Branch – Fort Mumbai ). All RTGS
transactions are irrevocable once the account is debited and the Bank executes transaction.
Any revocation, after the payment order is executed by the bank, shall not be binding on the
Bank in the RTGS system.
Transaction Amount: The RTGS system is primarily for large value transactions. The minimum
amount to be remitted through RTGS is Rs.2 lakh. There is no upper ceiling for RTGS transactions.
There is no limit on the number of transactions per day per Customer.
Charges: For Outgoing Transactions from Rs.2 to 5 lacs, Rs.25/- per transaction is levied and for
transaction above Rs. 5 Lacs, Rs.50/- per transaction is levied. Inward transactions are free.
National Electronic Fund Transfer (NEFT)
National Electronic Funds Transfer (NEFT) system is a nation wide funds transfer system to facilitate
transfer of funds from any bank branch to any other bank branch. RBI intends that high value
transactions should be routed through RTGS and small amount transactions should be routed through
NEFT. NEFT is only for fund transfer on behalf of the customers. NEFT works on deferred net
settlement (DNS) basis which settles transactions in batches. In DNS, the settlement takes place at a
particular point of time. All transactions are held up till that time. For example, NEFT settlement takes
place 6 times a day during the week days and 3 times during Saturdays. Any transaction initiated after
a designated settlement time would have to wait till the next designated settlement time.
The Customer should provide all the details as in the case of RTGS for conducting a NEFT
transaction. The beneficiary gets the credit on the same Day or the next Day depending on the time of
settlement. If the transaction fails for any reason, the account debited will be credited back. The
thresholed limit is 100000/- for NEFT. In case of any query, the branch can contact the dedicated
NEFT Centre set up at Service Branch, Mumbai through email – [email protected].
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64
.
Batch Timings: Eleven hourly settlements are carried out during the day by RBI, starting from
9:00AM to 7:00PM on all week days and five hourly settlements from 9:00 AM to 1:00 PM on
Saturdays. The messages sent before the above batch timings shall be included in the respective
settlements otherwise they shall be included in the next batch/day.
Note:
 RTGS and NEFT is entered in Finacle using the Command HEPS. Detailed guidelines and
accounting Procedure is available on the Bank‘s eCircular
 Indian Financial System Code (IFSC) is an alpha numeric code designed to uniquely identify the
bank-branches in India. This is 11 digit code with first 4 characters representing the banks code,
the next character reserved as control character (Presently 0 appears in the fifth position) and
remaining 6 characters to identify the branch.
 our circular No. HO/DIT/35/2008-2009/586 dated 09.02.2009 wherein it was informed that all
offices to ensure that all payments made by Bank to vendors, service providers and all external
agencies viz. Tax authority / Utility Payments etc. are invariablymade through electronic modes.
Electronic Clearing System (ECS)
It is a mode of electronic funds transfer from one bank account to another bank account using the
services of a Clearing House. This is normally for bulk transfers from one account to many accounts or
vice-versa. This can be used both for making payments like distribution of dividend, interest, salary,
pension, etc. by institutions or for collection of amounts for purposes such as payments to utility
companies like telephone, electricity, or charges such as house tax, water tax, etc or for loan
installments of financial institutions/banks or regular investments of persons. It eliminates delays due
to postal / clearing as the amount gets directly credited to the respective customers account.
There are two types of ECS - ECS (Credit) and ECS (Debit).
ECS (Credit) is used for affording credit to a large number of beneficiaries by raising a single debit to
an account, such as dividend, interest or salary payment.
ECS (Debit) is used for raising debits to a number of accounts of consumers/ account holders for
crediting a particular institution.
Customers are required to fill up the prescribed form (No. E-1) indicating choices of periodicity of such
payment and expected number of credit and aggregate amount. Detailed procedure is given in
Clearing Operations Chapter.
OBC eTaxes
The Bank is providing this facility through which all types of direct taxes can be deposited by the
customers online through the net banking services from the comfort of their office or home. The
challan will be generated online and the same should be preserved for future reference and records.
Procedure for e-payment:
1. To pay taxes online the taxpayer will select the relevant challan i.e. ITNS 280, ITNS 281, ITNS
282 OR ITNS 283, as applicable.
2. Enter its PAN/TAN as applicable. There will be an online check on the validity of the PAN/TAN
entered.
3. If PAN/TAN is valid the taxpayer will be allowed to fill up other challan details like accounting
head under which payment is made, name & address of TAN and also select the Bank through
which payment is to be made, etc.
4. On submission of data entered a confirmation screen will be displayed. If the taxpayer confirms
the data entered in the challan, it will be directed to the net banking site of the bank.
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65
.
5. The tax payer will login to the net-banking site with the user-id/password provided by the bank
for net-banking purpose and enter payment details at the Bank site.
6. On successful payment a challan counterfoil will be displayed containing CIN, payment details
and Bank name through which e-payment has been made.
Point of Sales Terminal (POS)
Point of Sales (POS) terminals are deployed/installed at Merchant Establishments (ME) i.e. shops,
petrol pumps etc. For making any payment debit card is swapped on these terminals and the amount
is entered, the transaction is processed and the customer‘s primary account linked with the Proton
card is debited online.
Our Bank has a tie up with the vendor M/s Atos Worldline India Pvt. Ltd. We have VISA
authorization and YES Bank has Master Card authorisation. So VISA transaction will be
authorized through our server and MasterCard will be authorised through YES Bank.
II. Types of charges levied on Merchant by Bank (Income)
a) MSF (Merchant Service Fee) - A fee as a percentage of transaction is collected from the
Merchant on per transaction basis. The MSF for debit card is mandated by RBI at 0.75% for
transaction up to `2000/- and 1% for transaction above `2000/-. Further, the MSF on credit
card levied by our bank ranges from 1.40% to 1.75% as floor rate. (Note: In case of subvention
the discounted MSF is offered on Credit card transaction)
b) TPF (Transaction Processing Fee) – The TPF is charges to the Merchants wherein the
monthly volume of the transaction is below `1.00 Lac.
c) GPRS Rental - The GPRS terminal rental is fixed at `1000/- per month apart from any other
fee or charges as applicable.
d) OTI (One Time Installation Fee) – The OTI is levied at the time of installation of the terminal.
It is `1200/- per terminal for merchant with existing POS from other banks while `2500/- for new
merchants for fist time installation of machine.
e) Paper Roll charges: The paper rolls are proposed to be charged at `21/- per roll or `0.65/- per
transaction.
Revenue on POS Machine (Approx.)
1. Card Owner Bank
2. Authorizer Charges (VISA/MASTER)
3. Intermediate Bank (OBC/YES)
4. Service Provider (M/s Atos Worldline)
: 1.1 %
: 4-8 Basis Point (0.04 -0.08 %)
: 4 Basis Point (0.04 %)
: 4-6 Basis Points
For VISA Authorisations
If our Bank‘s card used then we will get 1.1 % + 0.04 % = 1.14 %
If other Bank‘s card used then our Bank will get 0.04 %
For Master Card Authorizations
Our Bank Card won‘t have Master Authorization and authorization is done through YES Bank Ltd. So
our bank won‘t get any thing.
ADVANTAGE
1.
Cash handling is better with POS.
___________________________________________________________________________________
66
2.
3.
4.
.
Online transaction and direct Credit to the account.
Customer willing to pay through Card and if the merchant don‘t have the facility then it‘s
a discouragement for customer.
Encouragement for customers to spend more as no physical cash is involved.
Western Union Money Transfer
Our Bank has a tie up with Western Union Money Transfer through M/s Weizmann Forex Ltd. (WFL).
Western Union is a safe, reliable, legal and convenient way of transferring and receiving money world
wide (in India we can only receive inward remittance, as RBI does not allow outward
remittance). It is a legal method of receiving money in India as per RBI guidelines.
The Western Union Money Transfer system is a Net-based system, which provides on line information
about any money transfer affected from overseas location. The beneficiary can get payment of the
remittance after establishing the identity and other formalities from any of the outlets of Western
Union. Therefore, the transaction flow would depend upon the service offered by the branch under the
arrangement. The relevant stationery for handling remittances transactions and other publicity material
shall be provided at the designated branches by WFL. Weizman - 10481100136020
Online Tax Accounting System (OLTAS): OLTAS is a service provided by the bank for acceptance
of Income Tax and other direct taxes on behalf of Government. The customers including Corporate,
Individuals, Proprietorship concerns, Partnership firms, Trusts, Club, Society, etc. can pay their tax
liability through bank‘s OLTAS window available through 145 select branches across the country.
WHITE LABEL ATM‟s – INTRODUCTION
What is white label ATM‟s?
 White Label ATM‘s - or WLA‘s – are ATM‘s which are set up and managed by private
operators, in support with Banks
 The bank provides support only for cash management and settlement activities, in addition to
partnering for co-branding & promotions
Are WLA‟s different from Bank ATM‟s
No, customer experience at WLA‘s are exactly similar to Bank ATM‘s – all rules applicable for Bank
ATM‘s are also applicable for WLA‘s everywhere
What are WLA‟s advantages?
WLA‘s are established and managed exclusively by private operators within the country
These operators make the necessary investments to set up the WLA ATM‘s and receive a return
based on transactions and other fees such as advertising
As a result, Banks and Financial institutions are freed from the capital investments required to set up
much needed ATM infrastructure across the country
WLA Operators authorized by RBI
1.Tata Communications Payments solutions Limited, Mumbai
2. Prizm Payments Services Pvt. Ltd., Mumbai
3. Muthoot Finance Limited, Kochi
4. Vakrangee Limited, Mumbai
5. BTI Payments Pvt. Ltd., Bangalore
___________________________________________________________________________________
67
.
6. Srei Infrastructure Finance Limited, Kolkatta
7. Riddisiddhi Bullions Limited, Mumbai
LAUNCH OF DBTL (DIRECT BENEFIT TRANSFER FOR LPG) SERVICES
Presently Direct Benefit Transfer for LPG consumers is implemented through Aadhar seeding in Bank
accounts and onward registration of Aadhar numbers with Consumer numbers at OMC portal.
Now, National Payments Corporation of India (NPCI) has implemented ―Direct Benefit transfer for
LPG‖ for seeding of LPG consumer ID in Bank accounts directly.
A meeting was held in the Prime Minister‘s office on 22.10.2014 on issues relating to DBTL. It has
been decided as under:
―Multiple approaches will be used for seeding LPG databases with bank accounts and Aadhaar
numbers. Oil Marketing Companies (OMCs) will collect Aadhaar numbers and Bank account details at
LPG distributors and through drop boxes at other locations. Bankers could also use the Pradhan
Mantri Jan Dhan Yojana methodology and data collected to assist in the seeding process.
Two modes of seeding of bank accounts in LPG database are available in this scheme:
(a) Bank accounts details captured by OMCs (Oil Marketing Companies) and bank account
information (account number + IFSC + name of account holder) will be sent to banks electronically via
NPCI and banks will confirm the veracity of the information as per their records. Thereafter OMCs can
seed that bank account information in the LPG database. (Option 1)
(b) LPG consumer can approach Bank directly. LPG consumer ID will be captured by bank at the
branches against the bank account and the pair of LPG consumer ID details and bank account
information will be then electronically sent back to OMCs by bank.(Option 2)‖
FINACLE MENU OPTION :
Enter menu ―DBTLE‖ after login into finacle for entry & DBTLV for verification
___________________________________________________________________________________
68
.
Salient Features of Retail Credit Schemes
Oriental Education Loan Scheme (studies in India & Abroad)
Eligibility
Student who is an Indian national, meritorious student and has secured
admission in an institute recognized by a statutory body or by the Bank
Loan Amt
Term Loan
India – Rs.10.00 Lac
Abroad – Rs.20.00 lacHigher loans can be sanctioned by HO/RO authorities
Margin /
Up toRs.4.00 Lacs
NIL
Process Fee
AboveRs.4.00 Lacs
5%- For studies in India,
15% - For studies Abroad
P/Fee- For study in
India – Nil
For study abroad –Rs.1000.00 (fee would be refunded after taking course)
Rate of Interest
Loan up toRs.4.00 Lacs
BR + 2.50%
AboveRs.4.00 Lacs & UptoRs.7.50 Collateral Security in form BR +
Lacs
of
one
Third
Party 3.00%
Guarantee
Collateral security in form of
immovable property or any BR +
1.75%
tangible assets
AboveRs.7.50 Lacs
BR + 1.75%
Considered under Priority
sector
Security
Repayment
Simple interest till moratorium period. If the monthly interest is serviced during
moratorium period, concession of 1% in ROI is allowed. 0.50% concession on
ROI for women beneficiary. SC/ST & disabled students.
Co-obligation of Parents / Guardian. In case of married person, co obligator
can be either spouse or parent or parent in law. Parental co-obligation can
also be substituted by a suitable third party guarantee, power vested with
RLCC-RH. (Circular No. HO:Retail:39:2014-15:764 dated 19.12.2014)
Up to Rs. 4 lac –Nil, > Rs.4 Lac to Rs.7.50-Lac:- One Guarantee.> Rs. 7.50
:Mortgage / Extension of Charge or NSC/ UTI / LIC / FDR/Bonds( For serving
professionals/Executives & Defence Personnels: One personal guarantee and
post dated cheques from salary account)
For loans upto Rs.7.50 Lacs-upto 10 years,
For loans above Rs.7.50 Lacs- upto 15 years
Loan is repayable in EMI (excluding moratorium period i.e. Study period +
grace Period)
Points to remember:
 Under component of finance, College bus fare in case of study in India is also covered.
(Circular No. HO:Retail:39:2014-15:764 dated 19.12.2014)
 Interest switch over option fee 0.50% of outstanding loan amount as on date (Circular no.
HO:Retail:19:2014-15:442 dated 29.08.2014)
 As payment of interest is optional during the moratorium period, education loan cannot be
classified as NPA during the moratorium period. (Circular No. HO:Retail:35:2014-15:650
dated 10.11.2014)
___________________________________________________________________________________
69
.
 In case the education loan becomes NPA there shall not be any reversal of interest accrued
during the repayment holiday/moratorium period. (Circular no. HO:Retail:47:2013-14:1182
dated 28.03.2014)
 Under follow up monitoring, branches need to contact college/University to obtain progress
report on the student. IN case of foreign study loan Branches shall obtain SSN/Unique
identification number/ ID card and note the same in Banks record. PAN card is not mandatory
for availing student loan. UIDAI may also be captured in system. For recovery of dues
practices such as displaying names and photographs of defaulting students be stopped
herewith. (Circular no. HO:Retail:32:2013-14:841 dated 14.12.2013)
 If the repayments in education loans are extended due to revision in the repayment period
under the new Model Education Loan Scheme the same may not be treated as restructuring.
However, this treatment would be available only to education loans which are standard in the
books of banks on the date of such extension of repayment period. Further, such extensions
should not be given by banks with a retrospective effect and any extension in repayment
period should be need based and take into account the repayment capability of the borrowers.
(Circular no. HO:Retail:20:2013-14:568 dated 13.09.2013.
 Collateral free loan upto Rs. 20 lac to IITs/IIMs/XLRIs students and Rs. 25 Lac to students of
ISBs. The existing approval for considering Education Loans upto Rs 7.50 Lacs irrespective of
rating grade as applicable under Education Loan scheme shall remain continue. (Circular no.
HO:Retail:09:2013-14:181 dated 20.06.2013)
Padho Pradesh – Scheme (Circular HO: Retail:25:2014:417 dated 29.08.2014)
Objective
The objective of scheme is to award interest subsidy to meritorious students
belonging to economically weaker section of minority communities. Student
should have secured admission for Masters, PHD, M. Phil. Scheme is
applicable for higher studied abroad.
Income
From all sourcesRs.6 Lac (to applicant and his /her parents)
ceiling
Interest
Interest shall be borne by the Govt of India till the moratorium period of edu
subsidy
loan (course period+1years or six month of getting job)
Oriental Car/Vehicle Loan Scheme for General Public
Eligibility
For two Wheelers -Rs.10,000/- per month gross
For Four Wheelers:Rs.20,000/- per month gross
For existing Large and Mid corporate borrower Rs 40000 per month
a) Salaried Individuals with confirmed / minimum 1 year of service. The length
of previous employer's service(s) may also be taken into consideration for
the criterion of 1 year service.
b) Professionals (including doctors)
c) Business entities Established business for not less than two years.
d) Agriculturist based on their land holding and repayment capacity.
e) Non-Resident Indians- Jointly with Resident Indians (close relative)
OPEN CAR LOAN: Existing Large & Mid Corporate Borrowers (Firm/Company)Exposure Limit Rs. 10.00 crores and above
___________________________________________________________________________________
70
Loan Amt
Two Wheelers - Rs.10.00 Lac &
Four Wheelers- Rs.100.00 Lac (For 2nd Hand car loan – 25 Lac)
In case of salaried person 30 month gross salary/ pension subject to take home
criteria based upon gross monthly income as below
UptoRs.50000/- pm
ROI
.
Tenure
40%
AboveRs.50000/-pm
NORMAL / CARD RATE
During
Bonanza
BR+0.50%
BR+0.50%
30%
Festival
BR+0.50%
Up to 3 years
BR+0.75%
Above 3 years
For 2nd hand car loan – BR+3.00%
1. Reimbursement of finance for new four wheelers purchased out of own funds from
Reimbursement
the authorized Car dealer.
of finance
2. The reimbursement shall be within 3 months of purchase and shall be treated as
new vehicle loan
15% on on-road cost Old Car: True value(TVS): 20%, Others (Non TVS): 30%
Margin /
Process Fee
Process Fee: 0.50% Max. Rs.7000
* 100% concession under Festival Bonanza Offer (Circular no HO:Retail:40:201415:771 dated 29.12.2014)
Prepayment Penalty / documentation charges/ upfront fee- NIL
Repayment
New Car 84 Months ;
For salaried
For non
Business/professional Agriculturist
(pension)
pensioner
salaried
60 Years
65 Years
No age bar
Duration of crop
For
Age of Vehicle
Repayment Period
2nd
If car is older than 3 yrs & upto 4 yrs.
36 Months
Han
If car is older than 2 yrs & upto 3 yrs.
48 Months
d car
If car is upto 2 yrs old
60 Months
loan:
Security
Discretionery
Power
Hyp. of New Two wheeler / Four wheeler purchased out of Bank Finance
For Two wheelers
One personal guarantee acceptable to the
bank.
For Cars/MUVs
No personal guarantee
nd
Incase of 2 hand car
One third party guarantee acceptable to
Bank
Show room price + one time road tax + Registration Charges & First year's
insurance cost
OPEN CAR LOAN: Hyp. Of new CAR/ MUV, Collateral :NIL
Scale
For Two wheeler
For
New 2nd Hand Car Loan
Car
I
` 1 Lac
` 10 Lac
` 2 Lac
II
` 2 Lac
` 20 Lac
` 5 Lac
III
` 2 Lac
` 40 Lac
` 5 Lac
IV
` 2 Lac
` 50 Lac
` 10 Lac
V
` 2 Lac (As RH 10 Lac) ` 100 Lac
` 15 Lac (As RH same power)
___________________________________________________________________________________
71
.
VI
` 15 Lac (As RHRs.25 Lac)
VII
` 15 Lac (As RHRs.25 Lac)
Points to remember for interview purpose:
1. The payment to car dealer will be made on case to case basis i.e. condition of sourcing 10
cars is waived. (Circular no. HO:Retail:39:2014-15:764 dated 19.12.2014)
2. Income of spouse,Father,Mother, Brother, Son, Daughter in law & Unmarried daughter can be
co-applicant in the account. (Circular no. HO:Retail:34:2014-15:649 dated 11.11.2014)
3. Close relative in case of NRI for considering Retail Loan are Spouse, Father, Mother (including
step mother), Son (including step son), Son‘s wife, Daughter (including step daughter),
Daughter‘s husband, Brother (including step brother), Brother‘s wife, Sister (including step
sister), Sister‘s husband. (Circular no. HO:Retail:32:2014-15:610 dated 27.10.2014)
4. In case the vehicle is financed in the name of company, there is no need to register the charge
with ROC as specify charges or vehicle is already registered with RTO for hypothecation of
charge. (Circular no. HO:Retail:14:2014-15:217 dated 19.06.2014)
5. In built sanction of four wheeler loan to borrowers availing regular loan credit facilities from
Bank for last one year. Validity of sanction upto one year/ date of renewal whichever is earlier.
Loan limit Income upto Rs. 50000 p.m. – Rs. 5.00 Lac and And Above Rs. 50000 p.m. – 10
Lac. Equivalent to 20 times of gross annual income. Process fee shall be charged at the time
of disbursement only. Clause of per car sub limit is removed for RLCC. (Circular no.
HO:Retail:14:2014-15:217 dated 19.06.2014)
Retail Credit Scheme: Housing Loan (Oriental Home)
Eligibility
Loan Amt
ROI
Margin /
Process Fee
Age
Salaried employees , Self Employed. Professionals, Businessmen, Farmers ,
HUF.(including Staff, NRIs & PIOs) having assured source of income.
For Business man- 40 times Gross monthly Income and for salaried person- 60
times Gross monthly Income
Rs.15.00 lac(Furnishing) (restricted to 30% value of present realizable value of
house / flat)
Irrespective of loan
Base Rate
limit
For 3rd house onwards BR + 0.50%
 Net Take home Criteria
UptoRs.5 Lacs
50% AboveRs.15 Lacs toRs.25 Lacs 25%
AboveRs.5 Lacs & 40% AboveRs.25 Lacs
20%
UptoRs.10 Lacs
AboveRs.10
Lacs 30%
toRs.15 Lacs
 Margin:
Upto `20 Lac AboveRs.20 Lacs
` 75 Lacs and above Home
toRs.75 Lacs
furnishing
15%
20%
25%
25% of cost of
renovation
 Prepayment penalty is Nil.
0.50% of loan amount subject to maximum of Rs. 20000/- plus service tax, if
any. 100% concession under Festival Bonanza Offer (Circular no
HO:Retail:40:2014-15:771 dated 29.12.2014)
Minimum Age: 18 years as on date of application
Maximum Age:
For salaried (with pension) & other upto 70 years
Individuals
___________________________________________________________________________________
72
.
For Salaried (Non Pensionable)
Repayment
Security
Power chart
(Scale V to
VII – as RH
or BI)
upto 60 years or superannuation,
whichever is earlier
For Home Loan –Upto 360 months, including the moratorium period of 18
months subject to age of dwelling unit as under:
Age of Dwelling unit less than 10 Years
Maximum 30 Years
Age of dwelling Unit Older than 10 Years
Maximum 25 Years
Primary Equitable/ Registered Mortgage of financed property/property proposed to
be furnished; Collateral- Nil
w.e.f. 15.11.2014
Scale
Purchase/construction
Repair/ and (Oriental Personal loan
home loan scheme for existing
borrower)
I
` 10 Lac
` 2 Lac
II
` 20 Lac
` 3 Lac
III
` 40 Lac
` 5 Lac
IV
` 50 Lac
` 5 Lac
V
` 100 Lac
` 5 Lac
VI
` 150 Lac
` 5 Lac
VII
` 300 Lac
` 5 Lac
Points to remember for interview purpose:
 In case of professionals, Self Employed person and business man, two years average
income be considered for arriving MPBF under home loan scheme. However, it must be
ensured that two IT returns not to be filed together.
 No loan shall be given in respect of properties meant for residential use but which the
applicant intends to use for commercial purposes.
 Value to loan ratio should be kept at 150% (or Loan to Value Ration to be kept at 66.67%) in
case of extension of charge in other loan account. (Circular no. HO:Retail:32:2014-15:610
dated 27.10.2014)
 ROI for 3rd House onwards is BR+0.50%. Along with GLPP premium, Purchase price &
installation charges of rooftop Solar PVs and non solar lighting, wiring and other such fittings
shall also constitute component of finance. (Cir/HO: Retail:39/2014-15:764 dated
19.12.2014).
 Power to Takeover of HL is delegated to BM provided account should be classified as
standard Regular by the other Bank. (Cir/HO: Retail:39/2014-15:764 dated 19.12.2014).
 Loan amount for purchase of plot should not exceed 50% of the eligible loan amount.
 Sanctioning of Home loam to borrower who defaults in CIBIL reports other than Credit card
account lies with HLCC-ED. (Circular no. HO:Retail:40:2013-14 dated 23.01.2014)
 Banks charge of mortgage shall be noted in the Central Registry System within 30 days of
creation of such charge
 The clause regarding first right to refusal by our Bank be invariably incorporated in the
sanction letter of housing projects financed by the Bank. (Circular no. HO:Retail: 06:201415:18 dated 09.04.2014)
 Power of Concession in ROI to RH To captive/loyal customers who are having annual
average balance in their saving account Rs. 1.00 Lacs or in current account Rs.5.00 Lacs
and above. As well as to Directors, Partners or Proprietor of all Cash Credit account holders
having Credit Rating upto ―4‖ for last 24 months
 The penal interest shall be charged at the rate of 2% over and above the normal rate of
interest on irregular amount of loan and for the period of irregularity
 Classification of housing loan under priority sector (Circular no. HO:Retail:41:2014-15:792
dated 30.12.2014)
___________________________________________________________________________________
73
.
Type





Metropolitan
center
(with Other Center
population above 10 lac)
` 25 Lac
` 15 Lac
Purchase/construction
` 5 Lac
` 2 Lac
Repairs
Loans granted for construction of toilet in the house qualify for classification under priority
sector
Oriental Home Loan Point is launched at New Railway Road branch (0071) Gurgaon with the
objective of marketing of Retail Loans, expeditious sanctions and disbursement within 5
working days. (Circular no. HO:Retail:37:2014-15:705 dated 27.11.2014)
All home loan account to be reviewed annually. (Circular no. HO:Retail:31:2014-15:589
dated 17.10.2014)
Wherever Registered/Equitable mortgage cannot be created in case
DDA, HUDA etc.
Undertaking as per annx 14, security documents such as Annx 17 & 18, Power of attorney as
per annex. 6 and letters from borrowers to reinforce the right of the Bank to recover its dues.
(Circular HO:Retail:30:2014-15:588 dated 17.10.2014)
Maximum limit of eligible housing loans under CRGFS has been enhanced from the present
ceiling of Rs. 5 lac to Rs. 8 Lac. (Circular no. HO:Retail:33:2014-15:619 dated 01.11.2014)
Terms of Repayment
 EMI; or servicing of interest during moratorium period (Max 18 months)
 Payment of only interest for first five years and thereafter EMI
 Request for preponement of repayment period can be considered once during currency
of loan Repayment of agriculturist may be by way of monthly/quarterly/half yearly
instalments.
 If borrower makes bullet payment, EMI can be reset according to residual period.
Rajeev Rinn Yojna (RRY)
(Circular No. HO:Retail:27/2014-15:500 dated 19.09.2014)
Eligibility
Below Poverty Line(BPL): person holding BPL card issued by State
Government
Economically Weaker Section (EWS): Person having an average annual
income uptoRs.1 Lac
Interest subsidy
Low Income Group (LIG): Household average annual income
betweenRs.1 Lac and uptpRs.2 Lac
 IT Return/Form16, if available
 Income certificate issued by the competent authority as
notified by the respective State Govt. Notified competent
authority is available on
http://mhupa.gov.in/RRY/RRY_page.htm
 Self declaration form along with income certificate
For EWS
For LIG
` 5.00 Lac
` 8.00 Lac
Interest subsidy is available for loan amount uptoRs.5 lac
Margin
Security
Calculation of rate of interest for beneficiary would be net of subsidy from
GOI.
10%
Mortgage of unencumbered dwelling unit standing in the name of
Income
Certificate
Loan limit
___________________________________________________________________________________
74
.
borrower
ROI
Repayment
period
Moratorium
Period
Loans under the scheme are covered under Credit Risk Guarantee
Fund Trust for Low Income housing
BR
20 Years (maximum)
24 months (maximum)
Interest charged in the account need to be serviced and can not be
capitalized
Process Fee
Size of dwelling
unit
Subsidy is provided by HoHUPA during the period of moratorium
Nil
Rs. 500.00 is provided by Ministry and same may be treated as
process fee
Size of dwelling unit EWS
LIG
Minimum Size
21 sqm
28 sqm
Maximum Size
60 sqm
60 sqm
Points to remember:
 In case of NPA accounts, subsidy will be suspended.
 Cost of advocate, valuer, mortgage, insurance shall be borne by the applicant.
 Location of land should be in urban areas where total population should not be less that 1 Lac
as per 2011 census.
Oriental Personal Loan Scheme for Existing Home Loan Borrower
(Circular No. HO:Retail:21:2014-15:441 dated 29.08.2014) & (Circular no. HO:Retail:32:201415:610 dated 27.10.2014)
Purpose
 Purchase of consumer durables, kitchen equipments and furnishing
items such as TV, Fridge, AC, Collers, curtains including the insurance
thereof
 For purchase of GLPP
 For any personal use, which is not speculative
Nature of facility
TL and OD
Eligibility
Existing standard regular housing loan borrower(s)
Loan Amount
 Construction of house is completed and mortgaged
Min -Rs1 Lac ; Max:Rs5 Lac OR
10% of sanctioned limit under HL ; whichever is lower
Net take home will 30% of their gross annual income
Security
Margin – 25%
Extension of charge or declaration stating


The Bank can extend mortgage as and when required
The borrower will not create any other charge
___________________________________________________________________________________
75
.

ROI (For TL &
OD)
Process fee
Repayment
Title deed will remain with the Bank till the currency of loan
For Male Borrower
BR+1.50%
For Female Borrower
BR+1.00%
0.50% of the loan amount of Rs.500 whichever is maximum
For Salaried (with pension)
70 years
For non- salaried (without
Upto 60 years
pension)
*Discretionery power as same as renovation/repair of Housing loan scheme.
Points to remember:
1. Irrespective of the fact that home loan has been sanctioned under RO/HO power, BI can
consider the personal loan under the scheme as per vested power. (Circular No.
Ho:Retail:34:2014-15:649 dated 11.11.2014)
Oriental Mortgage Loan Scheme (OMLS)
Purpose
Types of
facility
Loan limit
The loan can be used to meet any legitimate need based Investments /
expenses except speculative & prohibited purposes as restricted by Law
a. Term Loan
b. Overdraft limit
c. Term Loan + Overdraft Limit (Combo Offer)- 60% in shape of Term Loan &
40% in shape of Overdraft limit (Non-reducing)
MaxRs.10 Cr (under MPBF calculation)
Mortgage (Registered or Equitable) of self-occupied Residential / Commercial /
Industrial Land & Building standing in the name of individual / joint owners / close
relatives who will also stand as Guarantors
(The Loan/Overdraft limit will be repayable upto maximum age of 75 years of
Guarantor.)
Assessment
of loan limit
Loan against agricultural land / plot of land (plot in isolation) partially
constructed property shall not be granted.
 50% of the realizable value of the property (overall maximum limit).
 36 months of gross income in case of salaried persons.
 4 times of average net annual income of last 2-3 years in case of persons
other than salaried ones.
Net Take Home: For individual : 30%;
ROI BR+2.25%; Process fee
Term Loan- 0.50% of Term Loan + Service Tax, if any (One Time Fee)
Overdraft- 0.10% of loan amount + Service Tax, if any (Recurring Fee).
Documentation charges
Up toRs.2.00 lacs
OverRs.2.00 lacs toRs.10.00 lacs
Nil
` 1000/-
___________________________________________________________________________________
76
Period of
loan
.
OverRs.10.00 lacs toRs.25.00 lacs
` 2500/OverRs.25.00 lacs toRs.50.00 lacs
` 5000/OverRs.50.00 lacs toRs.100.00 lacs
` 10000/OverRs.100.00 lacs
` 15000/Overdraft: 84 EMI for overdraft progressively reducing limit at 15% p.a. of the
original sanctioned limit
Term Loan: Maximum upto 84 EMI
HLCC-ED may consider to increase the tenure of the loan to a maximum of 10
years
Discretionery Scale
Power of sanction
power
I
Nil
II
` 20 Lac (to use judiciously)
III
` 25 Lac
IV
` 50 lac
V
` 75 Lac (As RH – 100 Lac)
VI
` 75 Lac (AS RH – 500 Lac)
VII
` 75 Lac (As RH 1000 Lac)
HLCC
Ind –Rs.7500 Lac Group –Rs.15000
ED
Lac
Points to remember:
1. Sanctioning of staff under OMLS scheme power vested with RLCC-RH (for the staff worked at
branches/STC (other than STC Noida) etc and staff posted at HO power vested with HLCCED. (Circular HO:Retail:39:2014-15:764 dated 19.12.2014)
2. Property already mortgaged in any existing loan account of same borrower can be extended
for the loan availed under OMLS/OBLS scheme provided value to loan ratio need to be
maintained at 150% (minimum). (Circular no. HO:Retail:32:2014-15:610 dated 27.10.2014)
3. Criteria for net take home is not applicable for Firm/company.
4. IMAC ratingf model will be utilised for loans to individual(where financial is not available) for
personal use. However, where loan is sanctioned for business model OTLS scheme be used.
(Circular no. HO:Retail:17:2013-14:508 dated 26.08.2013)
Oriental Business Loan Scheme (OBLS)
Purpose
To provide hassle free credit to meet working capital requirements / augment
long-term margin /financing of fixed assets related to business activity or for
expansion of business to Traders, Micro, Small and Medium Enterprises
(Manufacturing and Service),Contractors /Commission agents, and Authorized
service centre /Service Sector viz. hotels, guest houses etc. Purpose not
covered
-
Type of
facility
For speculative & prohibited by law
Advance shall not be granted for real estate/capital market/investment
in or loan to associates/sister concern
- Loans
to
individual/Builders/Property
dealers/Real
Estate
agents/Doctors/ Professionals
a) Overdraft limit for working capital purpose.
b) Term Loan/Demand Loan to acquire fixed assets for general business
purposes.
c) Non fund based limit for above a) & b) purposes.
___________________________________________________________________________________
77
.
1. Proprietorship, Partnership firms, Private / Public Ltd. Cos., engaged in
business activity Business for 1 year
2. Business units established by close relatives of existing customers even if
these are established for less than 1 year.
Elligibility
Security
Loan limit
The cash generation and repaying capacity of above said business establishment
shall be the primary criteria for considering term loan under the scheme.
1. Mortgage (Registered or Equitable) of immoveable property(s)/ factory land
and building and / or any other
2. Property (Land & Building) standing in the name of individual/joint owners/
promoters, viz. Proprietor/ Partners/Directors/close relatives who will also
stand as Guarantors
Note: The loan against agriculture land/plot of land (plot only in isolation)/
partially constructed property shall not be granted.
500 Lac; ROI - BR+2.25%
1. Working Capital Finance--50% of the realizable value of the property Or
20% of the estimated annual sales/income, Wherever the financial statement are
available. However, if the party is not maintaining proper financial statement, such
as Commission Agents etc. then 4 times of annual income (subject to cash
flow/repaying capacity) ,Whichever is less
2. Term loan: 50% of the realizable value of the property Or 75% of the assets to
be created out of term loan. Whichever is less.
Process Fee
Working capital finance and term loan together should not exceed 50% of
the realizable value of the property taken as collateral security.
1. Working capital-Rs.100.00 per lac plus service tax.
2. Term / Demand loan - Upfront fee of 0.50% of the loan amount plus service
tax, if any
1. The party shall exclusively deal with our Bank for all intent and business
purpose. An undertaking to this effect shall be obtained and kept on record.
2. The OD account shall be monitored and ensured that minimum 60% of
EXCLUSIVE
turnover is being routed through the account. In case of non compliance, 1%
DEALING
penal interest shall be charged over and above the normal rate of interest. The
CLAUSE
compliance of this clause shall be ensured at the time of annual review/renewal
of the account.
3. In case the loan is availed in shape of term loan, the concerned borrower shall
also maintain their operative account with us.
Points to remember:
1. Property already mortgaged in any existing loan account of same borrower can be extended
for the loan availed under OMLS/OBLS scheme provided value to loan ratio need to be
maintained at 150% (minimum). (Circular no. HO:Retail:32:2014-15:610 dated 27.10.2014)
2. Property or security already charged in OMLS/OBLS account may be extended to cover other
facility to the extent of spill over available i.e. property value in excess of 200% of the limit (o/s
in case of term loan & sanctioned limit in case of overdraft as per present valuation) can be
extended to cover other facility sanctioned to same borrower. (Circular no.
HO:Retail:32:2014-15:610 dated 27.10.2014)
___________________________________________________________________________________
78
.
3. In case of let out properties RLCC-RH & above shall be empowered to permit the accepting let
out property as security. Branches shall not have any power for accepting let out properties
under OBLS/OMLS Scheme. (Circular no. HO:Retail:32:2014-15:610 dated 27.10.2014)
Properties let out to our Bank for premises shall be considered as self occupied.
4. Loans to restricted sector such as SME & Others) dealing in Gems & Jewellery/Software/IT
Enterprises/Call Centres is permitted under OBLS/OMLS Scheme. (Circular no.
HO:Retail:32:2014-15:610 dated 27.10.2014)
5. Condition for primary security as Hypothecation of stock and Book debt has been removed.
Stock statement is not insisted. However end use of fund need to be ensured when loan is
given for business purpose. (Circular no. HO:Retail:32:2014-15:610 dated 27.10.2014)
Oriental Personal Loan scheme (OPLS-Govt)- Customised scheme for PSUs & Central/State
Govt employees (Working & Pensioner)
Purpose
Type
Facility
To meet personal/ family expenses like marriage/education/family functions /
purchase of consumer durables or any other legitimate purpose excluding for
speculation purpose.
of For working :Term Loan : 60 EMIs (subject to remaining period of service)
For pensioners:-
Eligibility
Amount
Loan
Security
Margin
Rate of
interest
Penal
Term Loan: 36 EMI, subject to repayment within maximum 70 years of age.
1. Permanent and confirmed employee of Public Sector Undertaking (PSU)
and Centre / State Govt. Deptt. and other Government institutions like
Universities/Colleges etc. having their salary account with our bank.
2. The net monthly salary should not be less thenRs.10,000/-.
3. The net take home salary should not be less than 30% of gross salary after
deducting the EMI of the proposed loan.
4. Eligibility for Pensioners:
a) Maximum Age should not exceed 68 yrs.
b) Pensioners of our bank staff are also eligible provided disciplinary action
are not pending against them.
Net Take home pension should not be less than 50% of Gross Pension
(including the installment of proposed loan).
of a) Up to 15 times net take home salary with a max ofRs.5.00 Lacs.
b) For pensioners: 12 month of pension with a maximum ceiling ofRs.2.00
Lacs.
a) One personal guarantee preferably of fellow employee, subject to the
condition that one employee will not stand as guarantor in more than two
accounts.
b) For Pensioners: Guarantee of the spouse eligible for family pension or in
case of non-availability of spouse any other family member or third party
guarantee acceptable to the bank.
NIL
BR + 2.25% p.a. with monthly rest
(Floating rate of interest)
2% penal interest over the normal lending interest rates on the overdue amount
___________________________________________________________________________________
79
.
Interest
for irregular period. No prepayment penalty to be charged.
/Prepayment
Penalty
Process/
0.50% of the loan amount with a minimum ofRs.500/ +Service tax, if any.
upfront fee
Points to remember:
1. The condition of obtention of employees undertaking has been waived off. However
undertaking from employee shall be undertaken for recovery of monthly dues, undertaking
addressed to employer for release of terminal benefit in case of eventuality in favour of our
Bank. Copy of the same to be forwarded to employer through registered AD. (Circular no.
2. Loan to staff members under OPLS Govt scheme is permitted for intervening period i.e. till
they get eligible for staff OD facility. Officer –Rs.3 Lac, Non Subordinate –` 2 Lac,
Subordinate –Rs.0.75 Lac. (Circular no. HO:Retail:22:2014-15:443 dated 29.08.2014)
Oriental Personal Loan Scheme (OPLS - Corp)
Purpose
To meet personal/ family expenses like marriage/ education/family functions /
purchase of consumer durables or any other legitimate purpose excluding for
speculation purpose.
Type of
Facility
Term Loan : 60 EMIs (subject to remaining period of service)
Eligibility
Amount of
Loan
Security
Margin
Rate of
interest
Penal
Interest
Prepayment
Penalty
Process/
upfront fee
1. Permanent employee of Corporate and other reputed non-government
organizations / institutions including college / schools etc. having their salary
account with our bank.
2. Minimum 3 years of service, including service with the previous employer(s),
if any.
3. The net monthly salary should not be less thenRs.10,000/-.
4. The net take home salary should not be less than 30% of gross salary after
deducting the EMI of the proposed loan
Up to 15 times net take home salary with a max ofRs.5.00 Lacs.
(For Existing Large & Mid corporate borrower –Rs.15 Lac, upto 1.5 time of net
annual income)
One personal guarantee preferably of fellow employee, subject to the condition
that one employee will not stand as guarantor in more than two accounts.
NIL
BR + 3.25% p.a. with monthly rest (Floating rate of interest).
BR + 2.00% p.a. (For existing large and mid corporate scheme)
2% penal interest over the normal lending interest rates on the overdue amount
for irregular period.
No prepayment penalty to be charged.
0.50% of the loan amount with a minimum ofRs.500/ +Service tax, if any.
___________________________________________________________________________________
80
.
Oriental Loan against Gold Ornaments Scheme
Eligibility
Type of
facility
Loan Limit
Purpose
Assessment
of Loan limit
All individual / proprietors borrowers
For Non-agriculture purpose
a)
Demand Loan
b) Overdraft
For Agriculture purpose
a)
Demand Loan
b) CC/ OD
c) Term Loan
MaximumRs.10.00 Lacs per borrower
All type of agriculture / allied activity, Business enterprises, Any other activity taken
up by the applicant for self employment, Personal consumption needs, non
speculative purpose.
75% of rate of 22 Carat gold jewellery or 75% of value appraised by Appraiser,
whichever is less.
Rate of 22 Carat gold need to be obtained from e circular site from time to time.
Upto Rs.25000/Rs.100/-
Valuer /
Appraiser
fee
Risk
mitigation
measures
Security
Margin
AboveRs.25000/-
0.25% of the loan amount
(The fee shall be borne by the borrower)
In the eventuality of steep fall in gold price and if margin goes even below 15%, the
bank shall issue a notice to the borrower to deposit the shortfall amount within 7
days of issue of notice failing which the Bank shall take appropriate action to
safeguard the Bank‘s interest. A pre-drafted undertaking to this effect be obtained
from the borrower while considering the proposal. This undertaking be got duly
vetted by legal retainer.
 Pledge of gold ornaments
 Pledge of Gold coins specially minted & sold by the bank having per coin weight
upto 20 gms. The aggregate weight of Gold coins shall be restricted upto 50
gms per customer
 Gold loans can be considered against 18 carat & above purity of gold.
(The security is kept under joint custody of Branch Official & Cashier)
a) For Demand Loan/ CC/ OD: 25% against value of gold ornaments offered as
security as assessed / appraised by the approved valuer.
b) For Term Loan: 50%
LTV of 75% for DL/CC/OD & 50% for TL shall be maintained throughout the
tenure of loan.
a) For other than farmers (non - agriculture purpose): Base Rate + 3.00% p.a.
b) For Farmers (Agriculture Purpose)
Rate of
interest
Nature of Facility
CC/OD for crop
production
Demand Loan /
Term Loan
Loan Amount
Irrespective of amount
Rate of Interest
Base Rate
UptoRs.0.50 Lacs
AboveRs.0.50 Lacs toRs.2.00 Lacs
BR+1.00%
BR+1.50%
___________________________________________________________________________________
81
.
AboveRs.2.00 Lacs
BR+2.00%
a) Floating On monthly rest (in loan accounts other than Agriculture purpose).
b) For Agriculture purpose loan should be linked to harvesting of crops.
a) UptoRs.0.25 lacs
– NIL
Penal
Interest
b) AboveRs.0.25 lacs & UptoRs.2.00 Lacs
– 1%
b) AboveRs.2.00 lacs
– 2%
c) No prepayment penalty
Note: The penal interest shall be charged on overdue amount and for the
period of irregularity.
For Non-Agriculture: 0.50% of the loan amount plus service tax, if any.
For Agriculture:
Process fees
 UptoRs.25000/- Nil
 AboveRs.25000/- 0.50% of the loan amount plus service tax, if any.
No documentation charges
a) Demand loan is to be liquidated within a maximum period of 12 months.
b) Overdraft facility shall be reviewed / renewed every year.
Repayment
Check
points
Documents
c) The repayment period of term loan shall be as prescribed as per the
activity, coinciding the harvesting and marketing season / generation of
income from the activity.
 Primary gold i.e. gold in any unfinished or semi finished form & includes ingots,
bar blocks, slabs, billets, shots, pellets, rods, sheets, foils and wires shall not be
pledged
 Gold Bricks / Biscuits/Sikh Bangles / Kada need not be taken as security for
advance
 Silver or Diamond jewellery have not to be accepted for advance
 Gold ornaments with names inscribed of person other than borrower (s) are not
to be accepted
 The valuation of the ornaments must be based on the weight and fineness of
gold contents only
 No Objection Letter from wife of the borrower, stating no objection for the pledge
of the gold ornaments
As specified in Circular No. HO:Retail:24:2014-15:460 Date: 04.09.2014.
Oriental Loan to Doctors
PURPOSE
1. FOR ACQUIRING PREMISES ON OWNERSHIP BASIS REQUIRED FOR RUNNING
CLINICS/NURSING HOMES,
2. FOR PURCHASE OF FURNITURE & FIXTURE/FURNISHING, RENOVATING EXISTING
CLINICS.
3. FOR PURCHASE OF STANDARD MAKE MEDICAL EQUIPMENTS/PROFESSIONAL TOOLS,
___________________________________________________________________________________
82
.
COMPUTERS/UPS/ SOFTWARE/ LIBRARY/BOOKS
ELIGIBILITY
QUALIFIED REGISTERED MEDICAL PRACTITIONERS WITH MINIMUM QUALIFICATION
CRITERIA
BIMS/BAMS/ BUMS/DHMS/BHMS/ BPT/ MBBS/BDS & ABOVE.
CONSTITUTION INDIVIDUALS, JOINT BORROWERS, PROPRIETORSHIP, PARTNERSHIP AND COMPANY
OF
THE (PVT./PUBLIC LTD.) CONCERNS WHERE MAJORITY OF SHARE HOLDING IS BY QUALIFIED
BORROWER
MEDICAL PRACTITIONERS ONLY IN CASE OF FIRMS/COMPANIES.
LOCATION
COMPOSITE LOAN LIMIT
LOAN
RURAL AREA & SEMI-URBAN
` 50.00 LACS
AMOUNT
URBAN & METROS
`100.00 LACS
A) TERM LOAN
TYPE
OF
FACILITY
MARGIN
B) CLEAN OVER DRAFT LIMIT -RS.5.00 LACS (SUBJECT TO AVAILABILITY OF TANGIBLE
COLLATERAL SECURITY EQUIVALENT TO 200% OF THE OD LOAN LIMIT, WITHIN THE
OVERALL COMPOSITE LOAN LIMIT CEILINGS).
25%
Normal ROI
Loan uptoRs.50000/Loan
aboveRs.50000/&
uptoRs.2.00 Lac
AboveRs.2 lac toRs.25.00 Lacs
AboveRs.25 Lacs toRs.1.00 Crore
(*CR- Credit Rating)
RATE
OF
INTEREST
(FLOATING)
PROCESS FEE
SECURITY
BR+1.75%
If covered under
CGTMSE
BR
BR+2.00%
BR
BR+2.25%
BR+2.50%, If
CR-1
BR+2.75%, If
CR-2
BR+3.00%, If
CR-3
BR+3.25%, If
CR-4
BR+3.50%, If
CR-5
BR+3.75%, If
CR-6
BR+1.00%
BR+0.50%, If CR-1
BR+1.00%, If CR-2
BR+1.50%, If CR-3
BR+2.00%, If CR-4
BR+2.50%, If CR-5
BR+3.00%, If CR-6
IN CASE OF DELAYED PAYMENT, PENALTY OF 2% ON THE OVERDUE AMOUNT FOR THE
OVERDUE PERIOD SHALL BE CHARGED.
0.50% OF THE TOTAL LIMIT SANCTIONED SUBJECT TO MINIMUM OFRS.500/- +SERVICE
TAX, IF ANY.
PRIME SECURITY: HYPOTHECATION OF ASSETS TO BE PURCHASED/ACQUIRED WITH THE
HELP OF BANK'S FINANCE AND EQUITABLE MORTGAGE OF BUSINESS PREMISES IF
FINANCED BY THE BANK.
COLLATERAL SECURITY:
FOR LOANS UPTORS.5.00 LACS:- (A) DOCTORS HAVING MBBS / BDS OR HIGHER
QUALIFICATION :- ONE THIRD PARTY PERSONAL GUARANTEE OF PERSON HAVING
ADEQUATE NET WORTH PREFERABLY OF SPOUSE (B) OTHERS :- TWO PERSONAL
GUARANTEES FOR DOCTORS HAVING QUALIFICATIONS OTHER THAN ABOVE.
FOR LOANS ABOVERS.5 LACS AND UPTORS.10.00 LACS:-TANGIBLE & REALIZABLE
COLLATERAL SECURITY EQUIVALENT TO 50% OF THE LOAN AMOUNT AND ONE
PERSONAL GUARANTEE PREFERABLY OF SPOUSE.
FOR LOANS ABOVERS.10.00 LACS:- TANGIBLE & REALIZABLE COLLATERAL SECURITY
EQUIVALENT TO 75% OF THE LOAN AMOUNT AND ONE PERSONAL GUARANTEE
___________________________________________________________________________________
83
.
PREFERABLY OF SPOUSE.
LOAN CAN BE COVERED UNDER CGTMSE SCHEME INCASE ABOVE COLLATERAL
REPAYMENT
SECURITIES ARE NOT AVAIALBLE
TOTAL REPAYMENT PERIOD INCLUDING MORATORIUM PERIOD SHALL NOT EXCEED 7
YEARS AND MAXIMUM MORATORIUM PERIOD SHALL NOT EXCEED 1 YEAR BASED ON
MERITS
Oriental Scheme for Loans to Professionals
Purpose
Eligibility
Criteria
Loan
Amount
Type of
facility
Margin
Rate of
Interest
(floating)
For investment in equipment (original cost excluding land & building and
furniture, fittings and other items not directly related to the services
rendered) does not exceedRs.2 Crore.
Professionals holding a degree/diploma or who in the opinion of the Bank
are technically qualified or possesses skills in the respective field like
registered practicing lawyers, Architects, Chartered Accountants, Chartered
Engineers, Journalists, Management Consultants, Software Engineers etc.
Individuals, joint borrowers, proprietorship & partnership firms and
Companies
Maximum Term Loan:Rs.20.00 Lacs
a) Term loan and b) Clean Over Draft limit - Rs. 5.00 Lacs (Subject to
availability of tangible collateral security equivalent to 200% of the OD loan
limit, within the overall composite loan limit ceilings).
25% of the assets financed
Loan uptoRs.50000
BR +1.75%
Loan aboveRs.50000 & uptoRs.2.00 Lac
BR +2.00%
BR +2.25%
Note:
1. Interest rates on Housing/Car & Vehicle loans shall be charged
as per the rates applicable in respective scheme.
2. 0.25% concession to women beneficiaries.
Process fee
0.50% of the total limit sanctioned subject to minimum ofRs.500/-.
Hypothecation of assets purchased/Mortgage of premises, if purchased.

Security
Repayment
Loans Upto ₹ 5 Lac: 50% of loan amount amount in the shape of
collateral security and one personal guarantee, preferably of spouse
 For Loans above ₹ 5 lac: 75% of loan amount both in the shape of
collateral security and one personal guarantee, preferably of spouse.
 In case the loan is required only for acquiring premises, no additional
collateral security shall be insisted.
 For purchase of car/vehicle security norms shall be as per
car/vehicle loan scheme.
Maximum 84 months including moratorium period not exceeding 6 months.
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84
.
Oriental Loan to Traders
PURPOSE
ELIGIBILITY
CRITERIA
LOAN LIMIT
MARGIN
RATE
OF
INTEREST
(FLOATING)
PROCESS FEE
SECURITY
FOR WORKING CAPITAL REQUIREMENTS: FORDAY TO DAY BUSINESS NEED
FOR TERM LOAN:
 Acquiring premises/land & constructions on ownership basis required for
running the business /financing of charges pertaining to conversion from
lease hold to free hold of business premises.
 For repair, furnishing, renovating existing business premises and/or
purchase of furniture & fixtures.
 For purchase of brand new equipments, business tools, computers, UPS,
software etc.
TRADERS WHO ARE INDIVIDUALS, FIRMS, COMPANIES, CO-OPERATIVE SOCIETIES,
DEALING IN THOSE GOODS, WHICH ARE NOT PROHIBITED BY RBI/GOVT SUCH AS SMALL
BUSINESS CONCERNS/AGENCIES PROVIDING SERVICES SUCH AS XEROXING, DRY
CLEANING, LICENSEE TO DEAL IN PETROLEUM PRODUCTS / LPG, DRUG LICENSEE FOR
THE APPLICABLE BUSINESS, PETROL PUMP DEALERS, AUTO SERVICES CENTERS ISD /
STD / PCO BOOTHS AND OTHERS.
THE MAXIMUM COMPOSITE LOANRS.50 LACS SUBJECT TO FOLLOWING CEILING.
1. THE WORKING CAPITAL FACILITY SHALL BE ALLOWED BASED ON 20% OF
ACTUAL/REALISTIC PROJECTED SALES.
2. IN CASE OF PETTY / SMALL BUSINESSMEN, BM MAY BE PERMITTED TO ALLOW
COMPOSITE DEMAND LOAN UPTO RS.2.00 LACS REPAYABLE IN 3 TO 5 YEARS ON THE
BASIS OF HIS GENUINE BUSINESS REQUIREMENT, WHERE THE BORROWER IS UNABLE TO
FURNISH THE FINANCIAL PAPERS. FOR TERM LOAN: 75% OF COST OF ASSETS
ACQUIRED IN CASE OF TERM LOAN/ PREMISES TO BE ACQUIRED FOR BUSINESS
PURPOSE
25% ON STOCKS (WORKING CAPITAL) / ON PURCHASE OF SHOPS / OFFICE PREMISES
Loan uptoRs.50000
Loan
aboveRs.50000
&
uptoRs.2.00 Lac
AboveRs.2.00 Lacs toRs.25.00
Lacs
AboveRs.25 Lacs toRs.50 Lacs
BR +1.75%
BR +2.50%
BR +2.75%
BR+2.50% If Credit rating is A++ (1)
BR+3.00% If credit rating is A+ (2)
BR+4.00% If credit rating is A (3)
BR+5.00% If credit rating is below A
(4,5,6&7)
IN CASE OF DELAYED PAYMENT, PENALTY OF 2% ON THE OVERDUE AMOUNT FOR THE
OVERDUE PERIOD SHALL BE CHARGED.
0.50% OF THE LOAN AMOUNT WITH A MINIMUM OFRS.500/ +SERVICE TAX, IF ANY.
CASH CREDIT/ TERM LOAN UPTORS.2 LAC: HYP. OF ASSETS PURCHASED OUT OF LOAN
AMOUNT, 3RD PARTY GUARANTEE OF ADEQUATE NET WORTH, STATEMENTS OF SALES,
PURCHASES, GROSS PROFITS, OVERHEADS AND NET PROFIT. COLLATERAL SECURITY
EXEMPTED UPTORS.2 LAC ONLY.
TERM LOAN/CASH CREDIT ABOVERS.2 LAC AND UPTORS.5 LAC- IN CASE OF CASH
CREDIT LIMITS HYP OF STOCKS, IN CASE OF TERM LOAN HYP. OF ASSETS PURCHASED
OUT OF LOAN AMOUNT. COLLATERAL SECURITY IN SHAPE OF NSCS, LIC (SV) OR ANY
OTHER TANGIBLE SECURITY WITH REALIZABLE VALUE, AT LEAST EQUIVALENT TO 25%
OF THE TOTAL EXPOSURE ALONG WITH ONE THIRD PARTY GUARANTEE OF ADEQUATE
NET WORTH ACCEPTABLE TO THE BANK. OR MORTGAGE OF IMMOVABLE PROPERTY
HAVING REALIZABLE VALUE AT LEAST EQUIVALENT TO 75% OF THE TOTAL EXPOSURE
___________________________________________________________________________________
85
.
ALONG WITH ONE THIRD PARTY GUARANTEE.
FOR LIMIT OF CASH CREDIT / TERM LOAN ABOVERS.5 LAC
COLLATERAL SECURITY IN SHAPE OF NSCS, LIC (SV) OR ANY OTHER TANGIBLE
SECURITY WITH REALIZABLE VALUE AT LEAST EQUIVALENT TO 50% OF TOTAL
EXPOSURE ALONG WITH ONE PERSONAL GUARANTEE OF ADEQUATE NET WORTH OR
EQUITABLE MORTGAGE OF IMMOVABLE PROPERTY HAVING REALIZABLE VALUE AT LEAST
EQUIVALENT TO 100% OF THE TOTAL EXPOSURE.
REPAYMENT


Term Loan :- 3 - 7 years
Working Capital Limit up toRs.5.00 Lacs shall be sanctioned for three
years and reviewed every year.
LIMIT ABOVERS.5.00 LAC SHALL BE RENEWED EVERY YEAR.
Oriental Scheme for Financing Autos/Taxis/Small Cargo Vehicles
Purpose
Eligibility
To acquire Autos (3 wheeler), Taxis (4 wheeler) / Small Cargo Vehicles for
commercial use only.
For Individuals & purchase of one vehicle
Valid Driving License
For purchase of More than one vehicle
Valid Driving License with
Minimum experience of 3 years
Individual, partnership, sole proprietorship, private Ltd. / Public Ltd. companies are
all eligible.
Note: The borrower shall obtain valid permit to ply the vehicle as per applicable
rules of Regional Transport Officer (R.T.O).
Loan
Amount
No. of
vehicles
Security
clause
Collateral
Security
Margin
85% of On Road price (As per pro-forma invoice). UptoRs.10.00 lacs per vehicle
subject to aggregate maximum limit ofRs.50 lacs.
Up to 10 (ten) vehicles per entity irrespective of it being an individual, partnership,
sole proprietorship, private Ltd./ Public Ltd. Companies.
Hypothecation of Auto/Taxi/ Small Cargo Vehicle to be purchased from Bank‘s
Finance.
(The hypothecation clause shall be registered with RTO)
Loan uptoRs.5.00 Lacs
No Collateral Security, Mandatory CGTMSE
Guarantee Coverage
Loan amount aboveRs.5.00 50% Tangible Collateral security in the shape of
Immovable / liquid security or CGTMSE
Lacs uptoRs.10.00 Lacs
Guarantee coverage
Loan amount aboveRs.10.00 100% tangible collateral Security in the shape of
Immovable/liquid security or CGTMSE Guarantee
Lacs
coverage
15% of the On-Road price of the vehicle(s).
___________________________________________________________________________________
86
Loan Limit
.
Normal ROI
Loan uptoRs.2.00 Lac
AboveRs.25 Lacs toRs.1.00 Crore
Rate of
interest
(Current
Base rate is
10.25%)
Penal
Interest
Process Fee
Repayment
Check points
If
covered
CGTMSE
BR
BR+1.00%
under
BR+2.00%
BR+2.00%
BR+2.50%,
BR+0.50%, If CR-1
If CR-1
(*CR- Credit Rating)
BR+2.75%,
BR+1.00%, If CR-2
If CR-2
BR+3.00%,
BR+1.50%, If CR-3
If CR-3
BR+3.25%,
BR+2.00%, If CR-4
If CR-4
BR+3.50%,
BR+2.50%, If CR-5
If CR-5
BR+3.75%,
BR+3.00%, If CR-6
If CR-6
In case of delayed payment, a penalty of 2% on the overdue amount for the
overdue period shall be charged.
0.50% of loan amount with a minimum ofRs.500/ + Service tax, if any.
60 months including moratorium period of 3 months. Servicing of interest during
moratorium period is compulsory.
Line of business, experience, driving history, invoice of dealer/vendor, inspection of
vehicle.
Oriental Scheme for Financing Against Govt. Securities/LICs etc
1. Indian Nationals 18 years and above
Eligibility
2. Firms/companies provided the offered securities are in the name of those
firms/companies.
To
meet
personal
expenses/business
expenditure
except
speculative/prohibited purposes.
1. Overdraft limit (renewable every year)
Purpose
Type of Facility
2. Demand Loan (repayable in 36 months)
Amount
Loan
of
Security
` 50.00 Lacs (maximum)
Govt. securities, PSU Bonds, Securities/Relief Bonds issued by
RBI/ICICI/IDBI, NSCs, LIC Policies of LIC of India or any other such security
transferable/assignable to the Bank.
1. 10% surrender value of insurance Policy
Margin
2. 25% of the face/accrued value of the security in other cases.
Rate of interest
BR + 2.00% p.a. with monthly rest
(floating)
Penal interest @ 2% p.a. over and above the normal lending interest rate
Penal Interest
shall be charged on irregular portion & for the period of irregularity.
Process/
`10/- per certificate with a minimum ofRs.50/ + Service tax, if any. However,
upfront fee
postal charges, if any, shall also be recovered from the borrower.
Disbursement
Through account of the borrower
___________________________________________________________________________________
87
.
Oriental Scheme for Beauty Parlours/Boutiques/Saloon/Tailoring by women
Propose
Nature
facility
To develop entrepreneur-ship among women and also to ensure the easy,
timely and convenient access to women to institutional credit.
of Term loan
For the purchase of tools/equipment/furniture & fixture, shop etc.
Working capital
For running day to day expenses of business
1.
Proprietary concerns of women
Applicant's
Eligibility
2.
Loan Amount
3.
Companies, where majority of promoters shares are held by women
UptoRs.10.00 Lacs
Out of which WC not to exceedRs.5.00 Lacs
Loan uptoRs.25,000/AboveRs.25,000/- & uptoRs.2.00 Lacs
AboveRs.2.00 Lacs & up toRs.10.00 Lacs
Margin
Rate
interest
(floating)
Partnership firms, where majority partners are women
of
Penal
Interest
Process fee
Security
Nil
15%
25%
In case of purchase of shop the margin will be 25% irrespective of loan limit.
Loan Limit
Normal ROI
If
covered
under
CGTSME
Loan uptoRs.50000/BR +1.75%
BR
Loan aboveRs.50000/- & uptoRs.2.00 BR +2.00%
BR
Lacs
AboveRs.2.00 Lacs & up toRs.10.00 BR +2.25%
BR+1.00%
Lacs
Penal interest @ 2% p.a. over and above the normal lending interest rate shall
be charged on irregular portion & for the period of irregularity.
0.50% of the loan amount with a minimum ofRs.500/-.
Primary: Charge over the assets (movable & immovable) purchased out of
Bank‘s finance.
Collateral


Repayment
Prepayment
Penalty
Up toRs.2.00 Lacs – NIL
AboveRs.2.00 Lacs- Tangible collateral security up to 100% of loan
value.
For Term Loan- the repayment period is 5 to 7 years with maximum moratorium
of 3 to 6 months.
NIL
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88
.
Oriental Loan against Deposit
To meet personal expenses / business expenditure except speculative /
Purpose
prohibited purposes.
1. All Indian Nationals of 18 years and above.
2.
Eligibility
Type
Facility
of
Amount
Loan
of
Firms/companies.
3.
Advance against deposits to Trust/Society /HUF/Club/Associations of
Persons etc.
1. Overdraft limit (renewable every year)
2. Demand Loan
500.00 Lac (maximum)
Note: RBI directions and circular issued by IBD Deptt from time to time shall
also be complied.
Pledge of duly discharged unencumbered deposit receipt issued by our
Security
bank only (Only parent branch).
S.No. Details of deposit
Margin
1.
Advance against Self Deposits less than 6 months
5%
Margin
2.
Advance against Self Deposits 6 months & above
10%
3.
Advance against Third Party Deposits
15%
S.No. Details of deposit
Rate of interest
1.
Advance
against
Self 1.50% over the applicable rate of
Deposits less than 6 interest on deposits
months
Rate
of
2.
Advance
against
Self 1.50% over the applicable rate of
interest
Deposits 6 months & interest on deposits
(floating)
above
3.
Advance against Third 2.00% over the applicable rate of
interest on deposit with a floor of
Party Deposits
Base Rate
Penal interest shall be charged equal to clean overdraft rate of interest for
Penal Interest
the period of irregularity, in case the account is irregularly overdrawn.
Process/
NIL
upfront fee
Disbursement Through account of the respective borrower
Description of Deposit
a. Self Term The deposit stand either in the name(s) of the borrower himself/borrowers
Deposit
themselves, or in the names of the borrower jointly with another person
The deposits do not stand either in the name(s) of the borrower
b. Third party
himself/borrowers themselves, or in the names of the borrower jointly with
Term Deposit
another person
c. Other Bank
No Loan shall be granted against the deposit of Other Banks.
Deposits
Scale
` In lacs
I
75.00
Discretionery
II
75.00
power
III
200.00
IV & Above
Fill
___________________________________________________________________________________
89
.
Points to remember:
1. Loans upto Rs. 500 Lac shall be considered under Retail Loan.
2. Branches should not allow creating FDRs out of overdraft allowed. (Circular no.
HO:Retail:36:2013-14:908 dated)
Oriental Earnest Money Scheme
Purpose
Eligibility
Loan amount
Margin
Rate of Interest
Upfront Fee /
Other charges
Security
To finance Earnest Money Deposit for applicants desirous of purchasing flats / plots
under scheme by State Housing Boards / Urban Development Authority
(SHB/UDA).
Any person or group of persons, singly or jointly having capacity at least to repay
the Earnest Money Loan.
100% of Earnest Money Deposit subject to maximum ofRs.10.00 Lacs
Nil
 Base rate i.e. 10.25%
 Upfront interest (fixed for scheme period) to be recovered for the period of
scheme.
NIL
a)
b)
Lien on Earnest Money Deposit with SHB/UDA.
The lien of our Bank shall be got noted with the authority. After the draw,
Earnest Money Refund order of unsuccessful applicants shall be sent by the
authority directly to the Bank instead of the applicant.
c)
Upfront Interest amount equivalent to period of draw (as declared at the time of
launch of scheme by the development authorities, normally 180 days) be
deposited by the borrower with the bank prior to release of loan and shall be
kept under bank lien.
Safeguards:
a)
Repayment
Disbursement
A rubber stamp shall be affixed on face of the application form showing that
application money has been financed by them.
b) Get the Earnest Money Finance column ticked in the form and fill in the detail
of bank in the next column.
i) In case of non-allotment: Earnest Money Loan shall be adjusted out of the
proceeds of refund from SHB / UDA along-with interest and other charges.
ii) In case of allotment: If borrower requests for servicing balance installments
payable for purchase of plot/ flat, it may be considered subject to repaying
capacity and eligibility criteria as per Housing loan policy.
iii) In case of non-liquidation of Earnest Money loan due to delay in draw by
authority: Matter to be suitably taken up with relevant / appropriate
SHB/UDAs as the case may be.
Entire Earnest Money Deposit (including margin) shall be paid directly to State
Housing Board/Urban Development Authority along-with application on behalf of
borrower.
___________________________________________________________________________________
90
Documentation
i)
ii)
iii)
iv)
v)
.
Loan application
Letter of undertaking from borrower (Annexure-A).
Application-cum-Authority Letter from the borrower (Annexure-B).
DP Note / Agreement to loan
Other documents to be obtained:
a. Photocopy of Application
b. Two crossed Post Dated Cheques favoring Oriental Bank of Commerce
c. Identity & Residence Proof (such as Ration Card / Pan No./ Passport /
Voter Card) to comply KYC norms
Oriental Reverse Mortgage Loan Scheme
Purpose
Eligibility
Loan quantum
Margin
Loan period/
nature of payment
For receiving lifelong annuity (on monthly basis), to be used for
sustenance or to supplement the cash flow stream of senior citizens in
order to address their financial needs.
Single or jointly with spouse in case of a living
No. of borrowers
spouse
Minimum age of first
60 Years
borrower
Age of spouse
60 years and above
 The residence (house/ flat) should be self
acquired, self owned and self occupied.
 Borrower(s) should have a clear and
transferable title to the property in their
names.
Residence
 Residual life of property should be at least
30 years.
 In case loan is sanctioned in the joint name
of the borrower(s), they must stay together
in the mortgaged property.
MaximumRs.100.00 Lacs. The loan amount will be released on monthly
annuity basis only.
AGE-GROUP
MARGINS
FOR AGE GROUP 60 TO 70
40%
FOR AGE GROUP 70 TO 80
30%
FOR AGE GROUP ABOVE 80
25%
 The tenor of the loan shall be upto 20 years or survival of any of the
spouse whichever is earlier, thereafter periodic annuity payment will
not be made.
 THE LOAN SHALL BE EXTENDED AS REGULAR MONTHLY ANNUITY
PAYMENTS DURING THE LOAN PERIOD
RATE OF INTEREST
PREPAYMENT
PENALTY/
DOCUMENTATION &
INSPECTION
CHARGES
PROCESS FEE &
OTHER EXPENSES
12.75% with monthly rest on Fixed Rate basis
NIL
0.50% of total Loan amount or half of the first monthly annuity payable to
borrower, whichever is less, subject to maximum ofRs.12,500/- only
1. The legal fee/ charges stamp duty, registration charges, valuation
___________________________________________________________________________________
91
SECURITY
.
charges, document stamp charges, & insurance premium of property
etc shall be borne by the borrower(s).
2. In the eventuality of non-payment of above said expenses, bank will
recover these expenses on prorata basis on the monthly annuity
payable to borrower(s) within a period of upto 24 months.
Equitable or Registered mortgage of un-encumbered residential property,
in favour of the bank.
Other important points related with retail credit:
 Time norm for Retail Credit Scheme: (Circular no. HO:Retail:36:2014-15:698 dated
01.12.2014)
Scheme
Housing and Mortgage Loan
Time frame for sanctioning by Branch and RO
For Loans under BM – 3 to 7 days after
Education loan
Vehicle Loan
For Loans under RH – Max. 15 days
Within 15 days
At the earliest.
 Levy of foreclosure charges/prepayment penalty on floating rate term loans is waived off
except Loan facility other than term loans; Loans sanctioned on fixed ROI & Credit facilities
sanctioned to person other than individual. (Circular no HO:Retail:07:2014-15:101 dated
10.05.2014)
 No fresh additional PDS shall be accepted provided branches should obtain 6 PDCs (in CTS
2010 Format) of the account from which ECS Debit Mandate has been given by borrower as
security. While recovery of the EMI will be done by ECS//SI in lieu of PDCs, these cheques
shouldn‘t be used for the purpose of recovery of regular EMIs as a matter of routine. Where
ECS/RECS facility is not available, branches may obtained PDCs complying with CTS2010
standard for recovery of EMIs. (Circular No HOP:Retail:35:2013-14:907 dated 08.01.2014)
SOME IMPORTAT POINTS
Basel-III (Some features)
Guidelines on the implementation of BASEL III Capital Regulations were released by the Reserve
Bank of India (RBI) on May 2, 2012. Implementation of these guidelines will begin April 1, 2013 and
the process will be completed by March 31, 2018.
Basel -II
Pillar-I
:
Minimum
Capital
Requirements
Pillar-II: Supervisory Review Process
Basel-III
Pillar-I: Enhanced Minimum Capital &
Liquidity Requirements
Pillar-II: Enhanced Supervisory Review
Process
for
Firm-wise
Risk
Management & Capital Planning
Pillar-III:Disclosure & market Discipline
Pillar-III: Enhanced Risk Disclosure &
Market Discipline
Highlights
 Banks required to maintain a minimum 5.5% in common equity (as against the current 3.6%)
by March 31, 2015
___________________________________________________________________________________
92



.
Banks to create a capital conservation buffer (consisting of common equity) of 2.5% by March
31, 2018
Banks to maintain a minimum overall capital adequacy of 11.5% (against the current 9%) by
March 31, 2018
Risk-based capital ratios to be supplemented with a leverage ratio of 4.5% during parallel run
A countercyclical buffer within a range of 0% - 2.5% of common equity or other fully loss
absorbing capital will be implemented according to national circumstances. The purpose of
the countercyclical buffer is to achieve the broader macro prudential goal of protecting the
banking sector from periods of excess aggregate credit growth
Bharatiya Mahila Bank:
The country‘s first pan-India national women‘s bank launched in Mumbai. Bharatiya Mahila Bank has
been set up with an initial paid-up of Rs 1,000 crore. Led by Usha Ananthasubramanian, all the eight
on the board of directors of the bank are women. The bank aims to increase its branch count to 25 by
March 2014. All seven branches of the Bank are in urban centers- Kolkata, Mumbai, Lucknow,
Guwahati, Chennai, Bangalore and Ahmedabad. India's first ever state-owned women's bank
inaugurated in Mumbai and even though the bank will focus on lending predominantly to women,
there will be no restriction on account opening ( deposits) by men. "We welcome both men and
women to open accounts with us but for loans there will be a positive bias towards women, said Usha
Anantha subramanian the chairperson of the Bharatiya Mahila Bank in an interview with CNBC- TV18.
So basically, deposits will flow from everyone, but lending will be predominantly for women.
THE LOKPAL BILL, 2013
THE LOKPAL BILL, 2013, ALSO REFERRED TO AS THE LOKPAL AND LOKAYUKTAS BILL, 2013, IS AN ANTICORRUPTION LAW IN INDIA WHICH
"SEEKS
TO
PROVIDE
FOR
THE
ESTABLISHMENT
OF
THE INSTITUTION OF LOKPAL TO INQUIRE INTO ALLEGATIONS OF CORRUPTION AGAINST CERTAIN PUBLIC
FUNCTIONARIES AND FOR MATTERS CONNECTING THEM".
THE BILL WAS INTRODUCED IN PARLIAMENT FOLLOWING MASSIVE PUBLIC PROTESTS LED BY ANTICORRUPTION CRUSADER ANNA HAZARE AND HIS ASSOCIATES. THE BILL IS ONE OF THE MOST WIDELY
DISCUSSED AND DEBATED BILLS IN INDIA, BOTH BY THE MEDIA AND THE PEOPLE OF INDIA AT LARGE, IN
RECENT TIMES. A RECENT SURVEY ESTIMATED THAT CORRUPTION IN INDIA HAD COST BILLIONS OF DOLLARS
AND THREATENED TO DERAIL GROWTH.
Following are some important features of the Lokpal Bill :
** Lokpal at the Centre and Lokayukta at the level of the states.
** Lokpal will consist of a chairperson and a maximum of eight members, of which 50 per cent shall be
judicial members.
** 50 per cent of members of Lokpal shall be from SC/ST/OBCs, minorities and women.
** The selection of chairperson and members of Lokpal shall be through a selection committee
consisting of Prime Minister, Speaker of Lok Sabha, Leader of Opposition in the Lok Sabha, Chief
Justice of India or a sitting Supreme Court judge nominated by CJI, eminent jurist to be nominated by
the President of India on the basis of recommendations of the first four members of the selection
committee.
** Prime Minister has been brought under the purview of the Lokpal.
** Lokpal‘s jurisdiction will cover all categories of public servants.
___________________________________________________________________________________
93
.
** All entities receiving donations from foreign source in the context of the Foreign Contribution
Regulation Act (FCRA) in excess of Rs 10 lakh per year are brought under the jurisdiction of Lokpal.
** Provides adequate protection for honest and upright public servants.
** Lokpal will have power of superintendence and direction over any investigation agency including
CBI for cases referred to them by Lokpal.
The Banking Laws (Amendment) Bill, 2012
The key amendment brought in under the Bill and its effect on the Indian banking sector as a whole.
AMENDMENTS
Powers Granted to RBI Under The Bill


New Bank Licenses and Greater Regulatory Oversight.
The Bill enables the Reserve Bank of India (RBI) to issue new bank licenses to corporate houses
which will give the RBI greater regulatory oversight over local banks & the ability to overrule board
of directors of a banking company for not more than 12 months and appoint an administrator for
managing the company during that period.
The Bill also seeks to increase the rates of existing monetary penalties that RBI can impose on a
bank if it disobeys RBI rules, directives or gives false information. These amendments shall be
conducive to the changing banking scenario because with the issue of new banking licenses the
need shall arise for greater regulatory control.
Acquisition of Shares and Voting Rights
Prior approval of RBI shall be needed for acquisition of 5% or more of shares or voting rights in a
banking company by any person. The RBI shall be empowered to impose such conditions as it
deems fit in this regard.
Amendment Related To Public/Private Sector Banks

Revised Voting right
Private Sector Banks: The Bill increases shareholders' voting rights from 10 per cent to 26 per
cent in private sector banks, making investment attractive for foreign players.
Public Sector Banks: This Bill also enables the government to raise voting rights in PSBs to 10
(ten) per cent from the current 1 (one) per cent, acceding partially to foreign investors' demands to
have more say in Indian banking.

In the shareholders meeting voting is done on many issues (for example election of Board of
Directors, Changing name of the Company etc.) but in case of public banks the shareholders have
only 1% voting right irrespective of number of shares held so they cannot heavily influence any
decision. So this amendment will make the voting rights proportional to the number of shares held
by shareholders and will attract foreign investors to invest in Indian banks.
Banking Merger
The Competition Commission of India will approve M&A (Mergers and acquisitions) in banks
except in the case of banks that are under trouble. In such cases, the RBI will have the final
authority,
___________________________________________________________________________________
94

.
Raising Investments
The Bill enables the nationalized banks to raise capital through "bonus" and "rights" issue and also
enable public sector banks to increase or decrease the authorized capital with approval from the
Government and RBI without being limited by the ceiling of a maximum of Rs. 3000 crore under
the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980.
CTR is Cash Transaction report. This report contains:
 All cash transactions of the value of more than Rs. 10 Lacs or its equivalent in foreign
currency, or
 A series of cash transactions individually below Rs. 10 Lacs or its equivalent in foreign
currency but integrally connected to each other where such transactions have taken place
within a month
Frequency: Monthly, on or before 15th of every month
STR is Suspicious Transaction report. This report contains:
 All suspicious transactions whether or not made in cash.
 IBA has circulated a list of 61 indicative alert indicators which are system generated. All 61
alerts are to be implemented by March 2014 in Phases.
 KYC-AML Cell at Inspection Deptt. Corporate office, circulated the list of transactions under
these 61 alerts to all ROs for their looking into the matter and confirmation, if any transaction is
to be reported under STR.
Frequency: Should be furnished within 7 days of arriving at a conclusion that any transaction,
whether cash or non-cash, or a series of transactions integrally connected are of suspicious nature
ABCD Analysis, (Branch categorization in different parameter as per the following
performance)
A. Budget Achieved
B. 80% & above of the Budget Achieved
C+ 50% & above of the Budget Achieved
C. Above March figure (Last F.Y.)
D. Below March figure (Last F.Y.)
UNIQUE ID TO CUSTOMERS
The Reserve Bank has extended the deadline for banks to complete the process of allotting a unique
customer
identification
code
to
their
customers
to
March
31,
2014.
Banks, however, will have to allot the Unique Customer Identification Code (UCIC) to all customers
while entering into new relationships.
The increasing complexity and volume of financial transactions necessitate that customers do not
have multiple identities within a bank, across the banking system and across the financial system, RBI
had said.
___________________________________________________________________________________
95
.
The objective of the UCIC is to help banks identify customers, track facilities availed, monitor financial
transactions in a holistic manner and to have a better approach to risk profiling of customers.
It also helps to smoothen banking operations for the customers.
ORIENTAL BANK MEDICLAIM POLICY
Oriental Bank of Commerce signed an agreement with The Oriental Insurance Company Ltd. tolaunch
"ORIENTAL BANK MEDICLAIM" Policy on 3rd Oct. 2011. The Product is designed exclusively for
the A/c Holders of OBC and is available in all OBC Branches across the country.
SALIENT FETURES:
 A family floater scheme covering 4 family members (Proposer + Spouse + 2 dependent Children
aged 3 months to 26 years).
 Age group covered - 3 months to 79 years.
 No Pre - medical examination required, only declaration.
 Cash less facility available at network hospitals.
 Cover available for Minimum Sum Insured of Rs.1 Lac, up to Rs. 5 Lac, in multiple of Rs.1.00 Lac.
The Premium Structure (Inclusive of Service Tax) is as under:
Sum-Insured Premium(Including S. Tax)
Rs. 1 Lac Rs 1749
Rs. 2 Lac Rs 3320
Rs. 3 Lac Rs 4620
Rs. 4 Lac Rs 5780
Rs. 5 Lac Rs 6830
Pre - Existing diseases are covered after 3rd completed years without break.
Income Tax benefit under 80D of the IT act.
LAUNCH OF MEDICLAIM CAMPAIGN : Q4 (FY 2014-15) (From 19.01.2015 to 28.03.2015)
JOINT VENTURE INSURANCE
Bank has started a Joint Venture Insurance Company ―Canara HSBC Oriental Bank of Commerce Life
Insurance Company Limited‖. The new JV insurance company was launched on 16th of June 2008. In
the JV insurance company, Canara bank has a stake of 51%, HSBC Insurance (Asia Pacific) Holdings
Ltd 26% and Oriental bank of Commerce 23%.
Recently Launched Two new Plans :
1. Smart Stage Money Back Plan
2. Smart Stage Monthly Income Plan
Sale Promotion Scheme for staff :
1. Winter Bonanza Scheme – valid till 25.01.15
2. The Star League - valid till 31.03.2015
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96
.
ECONOMICS AFFAIRS / GENERAL AWARENESS
 THE INDIAN BANKING SECTOR CONSISTS OF 26 PUBLIC SECTOR BANKS, 20 PRIVATE SECTOR BANKS AND
43 FOREIGN BANKS ALONG WITH 61 REGIONAL RURAL BANKS (RRBS) AND MORE THAN 90,000 CREDIT
COOPERATIVES.
 ICICI BANK LAUNCHES „DIGITAL VILLAGE‟ PROJECT :
Joining Prime Minister Narendra Modi's Digital India programme, top lender ICICI Bank has launched
its own 'digital village' project while adopting an entire village in Gujarat to provide services ranging
from cashless banking to digitised school teaching.
The project was announced on Friday to coincide with the 60-year-celebration of the ICICI group's
existence since the erstwhile ICICI was set up in 1955.
The Industrial Credit and Investment Corporation of India (ICICI) was originally set up as an Indian
financial institution at the initiative of the World Bank, the Government of India and representatives of
Indian industry to provide project financing to Indian businesses. It later got merged with ICICI Bank,
which was set up in 1994.
Speaking on the new initiative, ICICI Bank's MD and CEO Chanda Kochhar said the bank's activities
in this digital village is not limited to providing cashless banking through digital platforms, but was
focussed on use of technology in all aspects of every resident there.
This village, named Akodara, in Sabarkantha district of Gujarat incidentally happens to be the
same place where Modi started Gujarat's first animal hostel in 2011 when he was the Chief Minister of
the state.
The animal hostel, a concept conceived by Modi was envisaged as a place where the cattle of the
village are kept and maintained together and have all necessary infrastructure facilities to take care of
them.
"Through this Digital Village initiative, we are trying to set an example on how technology can change
the lives of people," said Kochhar, who began her career with erstwhile ICICI in 1984 as a
management trainee and has been instrumental in shaping the retail banking sector in India.
" Besides ATMs and other digital banking services, the bank has set up e-health, e-milk producer
group, wi-fi connectivity and schools with digital black boards in the village, along with a host of other
digital facilities.
Kochhar said the digital village has three themes - cashless, comprehensive and connected. The bank
has opened 2 crore financial inclusion accounts in the past four years and would keep contributing to
the nation's development.
Later, Modi dedicated the 'ICICI Digital Village' to the nation in presence of Finance Minister Arun
Jaitley, Maharashtra Governor C Vidyasagar Rao and state Chief Minister Devendra Fadnavis, among
others.
She said that the bank accounts have been opened in the village without submitting physical
documents and they are being serviced by a dedicated branch and an ATM.
"All adults in the village now have saving accounts," she said, while adding that the bank has also
made the APMC mandi at Himmatnagar, the district headquarters, the first cashless mandi in Gujarat.
The village also has high speed broadband connectivity via wi-fi and farmers can access the latest
information on prices of agricultural commodities on NCDEX. Besides, a website is being created for
the village.
ICICI Group will complete 60 years on January 5, 2015.
It is present across 18 countries, including India.
New Delhi - Only 48 percent of Indian adults have bank accounts and nearly half of them lie dormant,
says a report.
According to a nation-wide survey on financial behaviour, India has the highest account dormancy rate
even more than countries like Kenya, Tanzania, Uganda, Nigeria, India, Pakistan and Bangladesh
___________________________________________________________________________________
97
.
 REVIEW MONETARY POLICY
Mumbai: Encouraged by softening inflation, the RBI on Thursday decided to cut the benchmark
interest rate by 0.25 percent to 7.75 percent with a view to boost growth.
"It has been decided to reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25
basis points from 8.0 percent to 7.75 percent with immediate effect
The RBI has been keeping the benchmark interest rate at elevated level at 8 percent since January
2014.
The RBI, however, has decided to keep the cash reserve ratio (CRR), the portion of deposits which
the banks are required to have in cash with the central bank, unchanged at 4.0 percent.
Following reduction in the repo rate, the reverse repo rate has been adjusted to 6.75 percent and the
marginal standing facility (MSF) rate and Bank Rate to 8.75 percent.
Economy-at-a-Glance
Indicator
Latest
Previous
Year Ago
Gross National Income
4.8%
(Q3 2014)
7.5%
(Q2 2014)
9.0%
(Q3 2013)
Gross Domestic Product
5.3%
(Q3 2014)
6.4%
(Q2 2014)
7.0%
(Q3 2013)
Exports
US$5.848 billion
(Sept 2014)
US$5.474 billion
(August 2014)
US$5.056 billion
(Sept 2013)
Imports
US$5.567 billion
(Sept 2014)
US$ 5.490 billion
(August 2014)
US$ 5.719 billion
(Sept 2013)
Headline Inflation Rate
4.3
(Oct 2014)
4.4
(Sept 2014)
2.9
(Oct 2013)
Core Inflation Rate
3.2
(Oct 2014)
3.4
(Sept 2014)
2.5
(Oct 2013)
Analysis of last financial year – The Positives:
1. Gold & silver imports dropped 40 pc to $33.4 bn in 2013/14.
2. India‘s increase in share in world services exports from 0.6 pc in 1990 to 3.3 pc in 2013 faster
than goods exports.
3. Despite deceleration, services GDP growth at 6.8 pc was above the 4.7 pc overall GDP in
2013/14.
4. Poverty ratio declined from 37.2 pc in 2004/05 to 21.9 pc in 2011/12.
5. CAD at USD 32.4 billion (1.7% of GDP) 2013-14 as against USD 88.2 billion (4.7% of GDP) in
2012-13.
6. Foreign exchange reserves up from USD 292 bn at end March 2013 to USD 304.2 bn at end
March 2014.
7. Exports up 4.1% in 2013-14, compared to previous year‘s negative growth of 1.8%.
Objectives and forecast for next financial year:
1. GDP growth seen at 5.4-5.9 pc in 2014/15.
2. Growth rate of 7-8 pc can occur after 2015/16.
3. Industrial growth expected to revive gradually over 2-yr.
4. Food-grains production to go up to 264.4 MT in 2013/14.
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98
.
Union Budget 2014-15 highlights
For individuals
* Tax slab on personal income remains unchanged
* Income tax exemption limit raised by Rs 50,000 to Rs 2.5 lakh and for senior citizens to Rs 3 lakh
* Exemption limit for investment in financial instruments under 80C raised to Rs 1.5 lakh from Rs 1
lakh.
* Investment limit in PPF raised to Rs 1.5 lakh from Rs 1 lakh
* Deduction limit on interest on loan for self-occupied house raised to Rs 2 lakh from Rs 1.5 lakh.
* Kisan Vikas Patra to be reintroduced, National Savings Certificate with insurance cover to be
launched
* Long term capial gain tax for mutual funds doubled to 20 pc; lock-in period increased to 3 years
* Mandatory wage ceiling of subscription to EPS (Employee Pension Scheme) raised from Rs 6,500 to
Rs 15,000
* Minimum pension increased to Rs 1,000 per month
New projects
* 5 IIMs to be opened in HP, Punjab, Bihar, Odisha and Rajasthan
* 5 more IITs in Jammu, Chattisgarh, Goa, Andhra Pradesh and Kerala.
* 4 more AIIMS like institutions to come up in Andhra Pradesh, West Bengal, Vidarbha in Maharashtra
and Poorvanchal in Uttar Pradesh
* Govt proposes to launch 'Digital India‘ programme to ensure broad band connectivity at village level
* Kisan TV for farmers, Arun Prabha TV for northeast.
* National Rural Internet and Technology Mission for services in villages and schools, training in IT
skills proposed
* Govt proposes Ultra Modern Super Critical Coal Based Thermal Power Technology
* A project on the river Ganga called ‗Jal Marg Vikas‘ for inland waterways between Allahabad and
Haldia; Rs 4,200 crore set aside for the purpose.
* EPFO to launch the ―Uniform Account Number‖ Service for contributing members.
* New programme ―Neeranchal‖ to give impetus to watershed development in the country with an
initial outlay of Rs. 2142 crores.
* Beti Bachao, Beti Padhao Yojana to generate awareness and help in improving the efficiency of
delivery of welfare services meant for women.
* Free Drug Service and Free Diagnosis Service to achieve ― Health For All‖
* Two National Institutes of Ageing to be set up at AIIMS, New Delhi and Madras Medical College,
Chennai.
Allocations
* Rs 100 crore to support about 600 new and existing Community Radio Stations
* Swachh Bharat Abhiyan to cover every household with sanitation facility by the year 2019
* Rs 100 crore for metro projects in Lucknow and Ahmedabad
* Rs 2,037 crore set aside for Integrated Ganga Conservation Mission called ‗Namami Gange‘
* Rs 150 crore allocated for increasing safety of women in large cities
* Rs. 7,060 crore for the project of developing 100 Smart Cities.
* Set aside Rs 11,200 crore for PSU banks capitalisation
* Govt provides Rs 500 crore for rehabilitation of displaced Kashmiri migrants
* 1000 crore provided for ―Pradhan Mantri Krishi Sinchayee Yojna‖ for assured irrigation.
* Rs. 50,548 crore under the SC Plan and Rs. 32,387 crore under TSP
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Economic initiatives
* Composite cap of foreign investment to be raised to 49 per cent in Defence and Insurance sectors.
* Requirement of the built up area and capital conditions for FDI reduced to 20,000 square metres and
USD 5 million respectively for development of smart cities.
* Manufacturing can sell its products through retail including Ecommerce platforms.
* Requirement to infuse Rs.2,40,000 crore as equity by 2018 in our banks to be in line with Basel-III
norms PSUs will invest through capital investment a total sum of Rs. 2,47,941 crores.
* Rs 4,000 cr set aside to increase flow of cheaper credit for affordable housing to the urban
poor/EWS/LIG segment.
* Govt in favour of consolidation of PSU banks
* Govt considering giving greater autonomy to PSU banks while making them accountable
The numbers
* Government expects Rs 9.77 lakh crore revenue crore from taxes
* Plan expenditure pegged at Rs 5.75 lakh crore and non-plan at Rs 12.19 lakh crore.
* Fiscal deficit target retained at 4.1 pc of GDP for current fiscal and 3.6 pc in FY 16
* Disinvestment target fixed at Rs 58,425 crore
* Gross borrowings pegged at Rs 6 lakh crore
* Contours of GST to be finalised this fiscal; Govt to look into DTC proposal.
Administrative reforms
* Slum development to be included in the list of Corporate Social Responsibility
* An institution to provide support to mainstreaming PPPPs called 4PIndia to be set up with a corpus
of Rs. 500 crores.
MAIN EVENTS - 2014
BY THE UNITED NATIONS, 2014 WAS DESIGNATED THE:
 International Year of Family Farming and Crystallography.
 International Year of Solidarity with the Palestinian People.
 Latvia officially adopts the euro as its currency and becomes the 18th member of the Eurozone.
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The Ebola virus epidemic in West Africa begins, infecting over 21,000 people and killing at least
8,000 people, the most severe both in terms of numbers of infections and casualties.
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The XXII Olympic Winter Games are held in Sochi, Russia.
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Belgium becomes the first country in the world to legalise euthanasia for terminally ill patients of
any age.
 The Ukrainian parliament votes to remove President Viktor Yanukovych from office, replacing him
with Oleksandr Turchynov, after days of civil unrest left around 100 people dead in Kiev.
 Malaysia Airlines Flight 370, a Boeing 777 airliner en route to Beijing from Kuala Lumpur,
disappears over the Gulf of Thailand with 239 people on board. The aircraft is presumed to have
crashed into the Indian Ocean
 During an emergency meeting, the United Kingdom, the United States, Italy, Germany, France,
Japan, and Canada temporarily suspend Russia from the G8.
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In response to the 2014 Crimean crisis, the Parliamentary Assembly of the Council of Europe
(PACE) passes a resolution to temporarily strip Russia of its voting rights; its rights to be
represented in the Bureau of the Assembly, the PACE Presidential Committee, and the PACE
Standing Committee; and its right to participate in election-observation missions
 The 2014 FIFA World Cup is held in Brazil, and is won by Germany.
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Scotland Votes to Remain Part of the United Kingdom.
Events – India
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 GSAT-14 launched from Sriharikota using GSLV-D5 launch vehicle.
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[3]
Prithvi II missile tested at Chandipur test range.
Devyani Khobragade, an Indian diplomat whose arrest sparked a diplomatic incident involving
India and the United States, was indicted for allegedly lying to obtain a work visa for her
housekeeper. She left for India same day under diplomatic immunity.[6]
India and the entire South-East Asia region was declared Polio-free by WHO.[28][29]
A recently acquired C-130J Super Hercules of the Indian Air Force crashed near Gwalior killing all
five personnel on board. A volunteer was killed when he was washed away in the Chambal river
while searching for survivors.
Reserve Bank of India granted preliminary licenses to Infrastructure Development Finance
Company and Bandhan Financial Services to set up new banks.
India's second navigation satellite IRNSS-1B was successfully placed in orbit.
Phase 9 of Indian general election was held in Bihar, West Bengal and Uttar Pradesh. Indian
General Elections were completed.
Result of elections 2014 were declared. UPA was defeated, winning 61 seats compared to 218 in
last elections, with a decrease of 167. NDA's seat count increased by 198 to 335 in this elections,
compared to 137 in last elections.
26 May, 2014 - New Prime Minister Narendra Modi took oath as Prime Minister of India along with
other ministers from his council of ministers. The swearing-in ceremony was noted by media for
being the first ever swearing-in of an Indian Prime Minister to have been attended by the heads of
all SAARC countries.[51]
According to Andhra Pradesh Reorganisation Act, 2014, Indian state of Andhra Pradesh was split
in two new states Telangana and Andhra Pradesh with Hyderabad remaining the joint capital for
10 years. This made 29 states and 7 seven union territories in India.[52]
ISRO launched PSLV-C23 with 5 foreign satellites : SPOT 7, AISat, NLS7.1 (CAN-X4), NLS7.2
(CAN-X5) and VELOX 1, from Sriharikota.[58]
28 August 2014 - The Pradhan Mantri Jan Dhan Yojana was formally launched.
India's Mars Orbiter Mission of ISRO successfully entered Mars orbit.
NASA and ISRO signed an agreement to collaborate on an earth-observing satellite called NISAR
and future Mars missions.
2 October - Prime Minister Narendra Modi launched Swachh Bharat Abhiyan cleanliness drive.
The recipients of the 2014 Nobel Peace Prize were announced, awarded to India's Kailash
Satyarthi and Pakistan's Malala Yousafzai.[76]
12 October - Cyclone Hudhud made landfall near Vishakhapatnam, Andhra Pradesh.
8 November - 11 women died and more than 20 were hospitalised after a state funded masssterilization drive near Bilaspur in Chhattisgarh.[78]
12 November - Public sector bank employees carried out a day-long strike to demand a wage
revision.[79]
25 November - Polling begins for Jammu and Kashmir and Jharkhand assembly elections.[80]
27 November - Five civilians and three army personnel were killed in an encounter with militants in
Arnia sector, Jammu. Four militants were killed after a day-long gun battle.[81]
ISRO tests a crew reentry module in the Crew Module Atmospheric Re-entry Experiment using a
GSLV Mk III launch vehicle.[87]
Highlights of Rail Budget 2014
Union minister Sadananda Gowda is presenting his first Rail Budget in the Lok Sabha. Here are the
highlights :
* Indian railways to become the largest freight carrier in the world.
* Social obligation of Railways in 2013-14 was Rs 20,000 crore.
* Focus in past has been on sanctioning projects rather than completing them, Railway minister says.
* Railways also proposes to set up Food Courts at major stations.
* Spend 94 paisa of every rupee earned, leaving a surplus of only 6 paisa.
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* Dedicated freight corridor on Eastern and Western corridors.
* Proposal to start Bullet trains on Mumbai—Ahmedabad route. Speed of important trains will
be also raised.
* Diamond Quadrilateral project of high speed trains to connect all major metros.
* Wifi in A1 and A category stations and in select trains. Internet-based platform and unreserved
tickets.
* GIS mapping and digitization of Railway Land. Extension of logistics support to various e-Commerce
Companies.
* Facilitate transport of milk through rail. Special milk transportation trains in association with Amul and
National Dairy Association Board.
* One ticket to reach from Delhi to Srinagar. Uddhampur to Banihal by bus and Banihal to
Srinagar by train.
GENERALBANKING
(SOME IMPORTANT ACT AND THEIR IMP PROVISIONS)
a) Central Bank (RBI)
b) Specialised Banks
c) Commercial Banks
d) Development Banks
e) Co-operative Banks
a) Central Bank: As its name signifies, a bank which manages and regulates the banking ystem of a
particular country. It provides guidance to other banks whenever they face any problem (that is why
the Central Bank is also known as a banker‘s bank) and maintains the deposit accounts of all other
banks. Central Banks of different countries: Reserve Bank of India (INDIA), Federal Reserve System
(USA), Swiss National Bank (SWITZERLAND), Reserve Bank of Australia (AUSTRALIA), State Bank
of Pakistan (PAKISTAN).
b) Specialised Banks: Those banks which are meant for special purposes. For examples: NABARD,
EXIM bank, SIDBI, IDBI.
NABARD: National Bank for Agriculture and Rural Development. This bank is meant for financing the
agriculture as well as rural sector. It actually promotes research in agriculture and rural development.
EXIM Bank: Export Import Bank of India. This bank gives loans to exporters and importers and also
provides valuable information about the international market. If you want to set up a business for
exporting products abroad or importing products from foreign countries for sale in our country, EXIM
bank can provide you the required support and assistance.
SIDBI: Small Industries Development Bank of India. This bank provides loans to set up the smallscale business unit / industry. SIDBI also finances, promotes and develops small-scale industries
whereas IDBI (Industrial Development Bank of India) gives loans to big industries.
c) Commercial Banks: Normal banks are known as commercial banks, their main function is to
accept deposits from the customer and on the basis of that they grant loans. (Loans could be shortterm, medium-term and long-term loans.) Commercial banks are further classified into three types.
(a) Public sector Banks (b) Private sector Banks (c) Foreign Banks
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(a) Public Sector Banks (PSB): Government banks are known as PSBs since the majority of their
stakes are held by the Government of India. (For example: Allahabad Bank, Andhra Bank, Bank of
Baroda, Bank of India, Bank of Maharastra, Canara Bank, Central Bank of India etc).
(b) Private Sector Banks: In these banks, the majority of stakes are held by the individual or group of
persons. (For example: Bank of Punjab, Bank of Rajasthan, ICICI Bank, Axis Bank etc).
(c) Foreign Banks: These banks have their headquarters in a foreign country but they operate their
branches in India. For e.g. HSBC, Standard Chartered Bank, ABN Amro Bank etc.
d) Development Banks: Such banks are specially meant for giving loans to the business sector for
the purchase of latest machinery and equipments. Examples: SFCs (State Financial Corporation of
India) and IFCI (Industrial Finance Corporation of India).
e) Co-operative Banks: These banks are nothing but an association of members who group together
for self-help and mutual-help. Their way of working is the same as of commercial banks. But they are
quite different. Co operative Banks in India are registered under the Co-operative Societies Act, 1965.
and regulated by the RBI.
RESERVE BANK OF INDIA AND ITS MAIN FUNCTIONS
RBI: The Reserve Bank of India was established on April 1, 1935 in accordance with the
provisions of the RBI Act, 1934. RBI was nationalized in 1949 and it is fully owned by the
Government of India. RBI was established on the recommendation of the Hilton Young
Commission.
RBI‟s FUNCTIONS: 1. Issue of currency notes 2. Controlling the monetary policy 3. Regulator and
supervisor of the financial system 4. Banker to other banks 5. Banker to the government 6. Granting
licenses to banks 7. Control over NBFIs (Non Banking Financial Institutions) 8. Manager of Foreign
Exchange of India (also known as FOREX)
RBI & Monetary Policy: Monetary policy refers to the use of instruments under the control of the
central bank to regulate the availability, cost and use of money and credit.
The main objectives of monetary policy in India are:
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Maintaining price stability
Ensuring adequate flow of credit to the productive sectors of the economy to support economic
growth
Financial stability
There are several direct and indirect instruments that are used in the formulation and implementation
of monetary policy.
Direct instruments:
Cash Reserve Ratio (CRR): The share of net demand and time liabilities that banks must maintain as
cash balance with the Reserve Bank.
Statutory Liquidity Ratio (SLR): The share of net demand and time liabilities that banks must
maintain in safe and liquid assets, such as government securities, cash and gold.
Refinance facilities: Sector-specific refinance facilities (e.g., against lending to export sector)
provided to banks.
Indirect instruments:
Liquidity Adjustment Facility (LAF): Consists of daily infusion or absorption of liquidity on a
repurchase basis, through repo (liquidity injection) and reverse repo (liquidity absorption) auction
operations, using government securities as collateral.
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Open Market Operations (OMO): Outright sales/purchases of government securities, in addition to
LAF, as a tool to determine the level of liquidity over the medium term.
Market Stabilisation Scheme (MSS): This instrument for monetary management was introduced in
2004. Liquidity of a more enduring nature arising from large capital flows is absorbed through sale of
short-dated government securities and treasury bills. The mobilised cash is held in a separate
government account with the Reserve Bank.
Repo/reverse repo rate: These rates under the Liquidity Adjustment Facility (LAF) determine the
corridor for short-term money market interest rates. In turn, this is expected to trigger movement in
other segments of the financial market and the real economy.
Bank rate: It is the rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or
other commercial papers. It also signals the medium-term stance of monetary policy.
Reserve Bank of India Act,1934
 Scheduled Bank- As per Section 2(e) a Scheduled Bank is one whose name is included in the
Second Schedule to RBI Act, 1934 on satisfaction of the conditions laid down in Section 42(6).
 Section 17(4) enables RBI to grant loans and advances to Scheduled Banks
 Section 20 empowers RBI to act as Banker to the Govt.
 Section 22 gives right to issue Bank Notes.
 Section 29- Bank note shall be exempted from stamp duty under Indian Stamp Act.
 Section 31 prohibits issue of notes payable to bearer by any person in India other than RBI.
 U/s.38 RBI is the sole authority to issue currency in the country except for one rupee note or
coins( which is issued by Central Govt.)
 U/s 42(1) all scheduled banks are required to maintain CRR in the form of cash.
 U/s.45B RBI collects credit information from all banking companies and furnish consolidated
credit information to any banking company.
 If the average daily balance during any fortnight is below the minimum prescribed CRR penal
interest @3%p.a above Bank Rate is payable for that fortnight. If during the next succeeding
fortnight the average balance is still below the minimum prescribed CRR, penal interest
@5%p.a above Bank rate shall be payable in respect of that fortnight and each subsequent
fortnight during which the default continues.
Banking Regulation Act,1949
 U/s.5(b) Banking is defined.
 Section 6(1) defines business a banking company may carry on .
 Trading of goods by a Banking Company is restricted under section 8.
 U/s.17 every banking company incorporated in India is required to transfer each year to
Reserve Fund a sum equivalent to not less than 20% of profit before declaration of dividend
 As per Section 24, SLR is to be maintained. In case of default on any alternate Friday or on the
preceding working day if such Friday is a public holiday, penal interest @3%p.a over the Bank
Rate shall be payable on the amount of shortfall for that day. If default continues in next
succeeding alternate Friday or on the preceding working day incase such Friday is public
holiday penal interest shall be @5%p.a over the Bank Rate for each such shortfall.
 SLR is to be maintained in the form of cash, gold and approved securities.
 U/s.45(Z) Nomination facility has been granted for bank deposits..
 U/s 35A ,RBI has prohibited stapling of currency notes.
 U/s. 26 Return on unclaimed deposits for 10 years is required to be submitted.
National Bank for Agriculture and Rural Development Act,1981
 U/s.3 NABARD was established.
 As per Section 4, capital shall be Rs.100 crore which may be increased to Rs.5000 crore by
Central Govt. in consultation with RBI.
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Provides refinance facilities for credit to agriculture, small and village and cottage industries
Inspects RRBs and Co-operative Banks.
Banking Ombudsman Scheme,2006
 As per Section 4, RBI appoints one or more of its officers in the rank of Chief General Manager
or General Manager to be known as Banking Ombudsman.
 If a complaint on deficiencies in banking services is not responded by the concerned Bank
within one month or the reply has not satisfied the complainant, the Banking Ombudsman
whose jurisdiction covers the Bank Branch may be approached.
 The complaint should be made before expiry of one year after the cause of action has arisen.
 Complaint can be filed simply by writing on a plain paper.
 Complaint can be filed by authorized representative (other than an advocate) of the
complainant.
 No fees are charged for resolving a complaint.
 Complaint may be settled by agreement within a period of one month. In case it is not settled
by agreement, Banking Ombudsman may pass an award by giving reasonable opportunity to
both sides.
 The award is on compensation, not more than actual loss suffered on account of the act of
omission or commission by the bank or Rs.10 lac whichever is lower.
 In case Award is not acceptable, the party not accepting the award may approach the
appellate authority i.e. Deputy Governor of RBI within 30 days from the date of receipt of the
award. The complainant has also the recourse before Court.
Prevention of Money Laundering Act, 2002
 Records of cash transactions above Rs.10 lac or its equivalent in foreign currency have to be
maintained.
 Records of series of cash transactions connected to each other of below Rs 10 lac or its
equivalent in foreign currency within a month and the aggregate value of such transactions
exceeds Rs.10 lac have to be maintained.
 Records of Cash transactions in forged or counterfeit currency notes or bank notes and where
forgery of any valuable security has taken place have to be maintained.
 Records of Suspicious transactions in cash or otherwise have to be maintained.
 Records of transactions, both domestic and international, between the bank and the client
need be preserved for at least 10 years from the date of cessation of transaction.
 Cash Transactions Report (CTR) for transactions of above Rs.10 lac in a month have to be
submitted to Financial Intelligence Unit-India (FIU-IND) within 15 days of close of the month.
 Suspicious Transactions Report(STR) of a transaction ,in cash or non-cash, or a series of
transactions integrally connected have to be reported within 7 days of arriving at the
conclusion.
Indian Stamp Act,1989
 As per section 17 of Indian Stamp Act,1989 all instruments/documents chargeable with duty
and executed by any person in India shall be stamped before or at the time of execution.
 The Stamp Act extends to whole of India except J&K.
 Stamp duty on Demand Promissory Note, Bill of Exchange payable otherwise than on
demand, money receipts, proxies and transfer of shares comes under Central List. Powers to
reduce or remit the duty on these instruments are vested with the Central Govt.
 For other instruments stamp duty rates are prescribed by the respective State Govts.
 In case of Usance Bills, arising out of bonafide commercial or trade transaction, of not more
than 3months usance after date or sight drawn on or made by or in favour of a Commercial
Bank/Co-operative Bank stamp duty is remitted.
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Documents under Central list are not admissible in evidence if unstamped or understamped
and are nullified.
Stamps are of three typesa) Judicial stamps- These are used in connection with filing suit, court fees and other judicial
matters as per provisions of Court Fees Act.
b) Non-judicial stamp- These are used as per provisions of Stamp Act for commercial
transactions.
Non-judicial stamps are of three kinds:
1. Adhesive stamps- Adhesive stamps are those which are affixed by adhesive. There are
many varieties of adhesive stamps such as revenue stamp, foreign bill stamp, share transfer
stamp, insurance stamp, notary stamp, attorney stamp, consular stamp. These stamps are
used for transaction.
2. Embossed or Impressed stamps- Impressed stamps are Hundi papers( on which Hundis are
to be drawn) or Non-judicial stamp papers( on which stamps are already printed). These are
mostly used for execution of agreement such as hypothecation, pledge & lien agreements,
letter of continuity, letter of guarantees, mortgage deed etc.
3. Special adhesive stamps- These stamps are substitutes for non-judicial stamp papers. It is
convenient to use them in printed agreements. Special adhesive stamps are to be affixed and
cancelled by proper officer notified under the stamp rules.
c) Postage stamps- These are covered under India Post Office Act for postal charges.
The Securitisation and Reconstruction of Financial Assets and Enforcement of Security
Interest Act, 2002 (SARFAESI)
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In the event of default by a borrower, the bank have the powers to
Take possession, sell or lease the secured assets
Take over the management of the business of the borrower
Appoint a Manager( not below Scale-IV Officers)
Recover money from the debtor of the borrower
Loans outstanding of Rs.1 lac & above are covered by the Act.
Agri. Loans and where 80% recovery has been done are exempted.
U/s. 13(2) of the Act, secured creditor has to serve 60 days‘ notice before taking any of the
measures under Section 13(4) of the Act.
After service of notice if the borrower makes a representation or raises any objection, the
secured creditor shall consider such representation or objection and if the same is acceptable
or tenable, the reasons of non-acceptance have to be communicated within one week of
receipt.
Central Registry under SARFAESI Act,2002 ( CERSAI)
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Section 20 of the SARFAESI Act,2002provides for setting up of a Central Registry for the
purpose of registration of transactions of securitisation, asset reconstruction and security
interest under the SARFAESI Act.
Central Registry of Securitization, Asset Reconstruction and Security Interest of
India(CERSAI in short), a Government Company, licensed under Section 25 of the Companies
Act, 1956 has been incorporated
CERSAI has become operational from 31.3.2011.
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Under Section 23 of the SARFAESI Act, particulars of any charge creating security interest
over property is required to be filed with the Registry within 30 days from the date of creation.
The Central Registrar may allow the filing of particulars of such transaction or creation of
security interest within thirty days next following the expiry of the said period of thirty days on
payment of such additional fee not exceeding ten times the amount of such fee
Section 27 of the SARFAESI Act provides that any default in filing the above mentioned
transactions shall be punishable with fine which may extend to Rs. 5000/-for every day during
which the default continues
Four Forms, viz. Form-I, Form-II, Form-III and Form-IV have been prescribed for the purpose
of filing particulars of transaction to be registered with the Central Registry.
FORM-I – To be used for filing Particulars of Creation or Modification of
Security Interest in favour of Secured Creditors
Fee:For a loan upto Rs.5 lac : Rs. 250/- for both creation and modification of security interest
For a loan above Rs. 5.00 lakh: Rs. 500/- for creation and for any subsequent modification of
security interest in favour of a secured creditor.
FORM-II – To be used for filing Satisfaction of any existing Security Interest
Fee – Rs. 250/FORM-III – To be used for filing Particulars of Securitisation or Reconstruction of
Financial Assets Fee – Rs. 1000/FORM-IV – To be used for filing Particulars of Satisfaction of Securitisation or
Reconstruction transactions
Fee – Rs. 250/The particulars of every transaction referred to above shall have to be filed with Central
Registrar within a period of thirty days from the date of such transaction.
In case of delay in filing, the Central Registrar may on an application being made stating the
reasons for delay not exceeding thirty days, allow filing of particulars on payment of additional
fees, as specified in the SARFAESI (Central Registry) Rules.
The particulars of any transaction kept in Central Registry are open for inspection to any
person through the website of Central Registry during the business hours of the Central
Registry on payment of fee of Rs. 50/-.
Various Type of Customers
HUF:
 The Hindus, Sikhs & Jains are the communities who can form HUF
 Joint owners of HUF are called Co-parceners.
 Only male member by birth or adoption can become co-parcener.
 Senior most member or Karta alone is empowered to handle the affairs of HUF.
 HUF declaration form or account opening form should be executed by the Karta in Karta‘s
capacity and by all the major co-parceners in their personal capacity.
 On Karta expiring or becoming insane or being declared as personally insolvent, the next
Senior most male co-parcener becomes Karta.
Pardanashin Lady:
 In a contract with a Pardanashin Lady presumption of undue influence always exists. Hence
the contract cannot be free from all defects.
 Bankers generally discourage opening of accounts of Pardanashin Lady as her identity cannot
be ascertained.
Blind Persons:
 Rules are to be explained in front of a witness.
 Identification marks are to be noted.
 Deposits and payments are to be witnessed by independent person.
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All banking facilities should be given (viz. cheque book, atm card, ibanking etc.) as available
for normal person
Illiterate Persons:
 They are capable into legal contract.
 Rules are to be explained in front of a witness
 They are to call on the bank personally to receive payments.
 Joint a/c. of two illiterate persons should be under joint operation.
Minors:
 As per section 3 of Indian Majority Act, 1875 a person who has not completed 18 years of age
is a minor and if a guardian is appointed by a court during his minority, he remains minor till
completion of 21 years of age.
 A minor is not capable of entering into valid contract.
 Minor‘s account may be opened to be operated by the natural guardian or the court appointed
guardian.
 Minor‘s account may be opened to be operated by the minor himself if he or she is of 10 years
age and can read and write.
 When the father is not in actual charge of the affairs of the minor who is in exclusive care and
custody of the mother, the mother can act as Natural Guardian even during the life time of the
father.
 A Hindu father entitled to act as guardian can also appoint a guardian in respect of the minor‘s
person or property who acts after the death of the father or mother and is known as
Testamentary Guardian.
 No overdraft/loan should be given to a minor even if security is provided as such contract will
be void. A guarantee in such a case will also be invalid.
 A minor can draw, endorse or negotiate a cheque or a bill and can bind others but he is not
liable on such instruments.
 A minor can be admitted to the benefits of a partnership, but he is not liable for the losses of
the firm.
 A minor can also be appointed as an agent to act on behalf of the principal. He can bind his
principal but he cannot be held responsible to his principal.
Joint Accounts:
 Joint accounts are governed U/s. 45 of Indian Contract Act, 1872.
 Anyone of the account holders can stop payment of cheques even though he does not operate
the account.
 In absence of a mandate from the joint account holders, balance in a joint account shall be
paid to the surviving account holders and the legal heirs of the deceased account holder, in the
event of death of a joint account holder.
 In the event of death, insolvency or insanity of any one of the joint account holders, operations
in the account shall be stopped, on receipt of notice.
Partnership Firms:
 A partnership firm is an entity separate from its partners.
 A partnership is the relationship between two or more persons who agree to share the profits
of business.



As per Section 11 of Indian Partnership Act 1932 a firm engaged in banking business cannot
have more than 10 partners, while in other firms the number cannot exceed 20, otherwise the
partnership will be illegal.
Registration of firm is not mandatory, but a registered firm can sue others to enforce a right
arising out of a contract.
Suits by unregistered firm are not maintainable. A partner of an unregistered firm cannot sue
other partners for his rights.
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.

A minor can be admitted only to the benefits of a partnership, but he cannot be held liable for
the acts of the firm. Minor‘s date of birth has to be recorded. On attaining majority if he
chooses to remain partner, the same need be recorded accordingly.
 A partner is an agent of the firm and his acts for and on behalf of the firm bind the firm.
 While opening bank account, all partners have to sign the account opening form. However,
operation of the account may be decided by the partners to suit their convenience.
 Cheques payable to the firm or endorsed to the firm cannot be credited in the personal account
of the firm as that would amount to conversion.
 In case of death/retirement or insolvency of a partner, operations in the account should be
stopped. If the balance is in debit and a fresh account should be opened to avoid operations of
rule in ‗Clayton‘s Case‘ . The lunacy of a partner does not dissolve a firm unless ordered by the
court.
 Cheques signed by insane, insolvent and dead partner should not be paid.
 HUF/Trust/Joint Stock Co. can become a partner in a firm.
 In case of dispute between partners, one partner can revoke the authority against other
partners to operate the account. In such situation, the banker has to stop the operations in the
account.
 On death of a partner the firm is treated as dissolved unless there is a contract to the contrary.
 Admission of a new partner dissolves old firm and forms a new firm.
Limited Liability Partnership(LLP)
 LLP Act,2008 was introduced w.e.f 1.4.2009
 LLP is a separate legal entity and has perpetual succession.
 No. of Partners: Min.2, Max.- no limit
 As in a company, liability of partners in LLP is limited to the extent of their contribution.
 Partners‘ personal assets are not liable for firm‘s act.
Joint Stock Companies:
 Joint Stock companies are separate legal entities.
 Private Ltd Company- Shareholders :- minimum 2 and maximum 50
Directors :- minimum 2 and maximum 7
 Public Limited Company- Shareholders:- minimum 7 and maximum unlimited
Directors :- minimum 3 and maximum unlimited
 While opening accounts following documents are to be obtained:-

a) A true copy of the Memorandum of Association which specifies relationship with
outside world and contains objectives, liability, name and scope of the activities.
b) A true copy of the Articles of Association which lays down the regulations for
carrying the objects, activities and management of its internal affairs as defined in its
Memorandum of Association.
c) A true copy of certificate of incorporation.
d) A true copy of certificate of commencement of business in respect of public limited
companies.
e) A copy of resolution from the Board of Directors of the company certified by the
chairman of the meeting. This would normally cover
i. Name of authorized persons
ii. Scope of their authority
iii. Their designation
iv. Their signatures
v. Operational Instructions
Companies cannot go beyond the scope of their objects and violation, if any, in this regard is
known as ‗Ultra –Vires‘ of the company.
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109



.
Articles of association confer powers on the directors and they are normally not supposed to
act beyond the powers. If any director exceeds the conferred powers, such acts will be treated
as ‗ultra-vires‘ of the company.
Personal insolvency/death/insanity of any director does not affect the functioning of the
company. Such cheques can be paid unless there is clear instruction to the contrary.
Banker must note the complete address of registered office of the company as any legal notice
or recall notice can only be served on the Regd. Office of the company u/s. 51 of Companies
Act.
Executors and Administrators:
 When a person leaves a will, the person named in the will to look after the property of the will
maker after his death is called executor. But if a person does intestate i.e. without leaving any
will, court appoints an administrator to look after the estate of the deceased.
 Executor‘s account is to be opened on production of probate for the will granted by the court.
 Administrator‘s account is to be opened on production of letter of administration issued by the
court.
 The account may be opened in the style of ―A-Executor( or Administrator) to the estate of X
deceased.
 All executors or administrators are considered as one person U/s. 221 of Indian Succession
Act,1925. On the death of an executor, his powers are vested in the surviving executor and in
case of sole executor; fresh probate has to be obtained. In case of death of one
executor/administrator, a cheque issued by him should not be returned as deceased
executor‘s/adminstrator‘s powers are vested with the surviving executors/administrators.
 Stop payment instructions can be issued by a single executor/administrator in the event of
more than one executors/administrators. But withdrawal of stop payment instructions should
be by all executors/administrators.
Trusts:
 Indian trust Act governs Private Trusts. Public Trusts are governed by Public Trust Act. The
document which creates a trust is called a Trust Deed.
 Trust Deed should be carefully examined to ascertain the powers of the trustees and other
conditions.






Trustees cannot delegate their authority.
Trust account should be operated jointly when the number of trustees is two or more unless
the Trust Deed provides to the contrary.
Trustees do not have implied authority to borrow. They can borrow for the Trust where the
Trust Deed provides so.
Insolvency of a trustee will not affect the trust property as the creditors of the trustee cannot
have any recourse to the property of the Trust.
Cheques in favour of the Trust should never be credited to personal account of the trustee.
Funds lying in a trust account cannot be utilized for payment of debts of the trustee.
Societies and Clubs:
 Societies and clubs are non-profit making organizations and represent a group of persons.
These institutions are normally incorporated under the Co-operative Society‘s Act.
 While opening account, the following precautions are to be taken
a) Copy of registration certificate should be obtained
b) Copy of the bye-laws should be obtained
c) Copy of resolution passed by the Managing Committee regarding opening and conduct of
the account which should specify the names of the persons authorized to operate the account.
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.
On death, resignation of the authorized office bearer, bank should stop operations till nomination of
another.
Banker Customer Relationship:
 Debtor and Creditor-On opening of a deposit account the banker becomes a debtor to its
deposit account holder. But the position changes to Creditor-Debtor when the customer‘s
account is overdrawn. The Creditor has the right to demand payment of the money from the
banker; and the banker is under obligation to repay its debt whenever required to do so
properly.
 Agent-Principal- Banker assumes the role of agent while collecting cheques/ undertaking sale
purchase of securities.
 Bailor- Bailee- When articles are received for safe custody, the relationship is of Bailor-Bailee
 Lessor-lessee- The relationship arising out of hiring of a safe deposit locker is that of LessorLessee.
Banker‟s Obligation to maintain secrecy of accounts:
The banker is under an obligation not to disclose any information regarding his customer‘s accounts to
a third party and also to take all necessary precautions and care to ensure that no such information
leaks out.
Disclosure of information as required by Law:
 A banker has to disclose information in respect of customer‘s account in the following cases:
a. Under Income Tax Act,1961-Section 133 of Income Tax Act empowers the Income Tax
Authorities to to ask a banker to furnish information in respect of his customer‘s account.
b. Under Companies Act,1956- As per section 235 or 237, the banker of a company is required to
provide information of the company‘s account to the Inspector appointed by the Central Govt.
Under Court‘s Order-Banker is bound to produce certified copies of the entries in the bankers‘
books as per the Bankers‘ Books Evidence Act,1891.
d. Under RBI Act,1934- Under Section 45B RBI asks for credit information which the banker has to
provide. After enactment of Reserve Bank of India( Amendment) Act,1974, the banks are granted
statutory protection to exchange freely credit information mutually among themselves.
e. Under Banking Regulation Act,1949- U/s. 26 every banking company has to submit a return
annually of all such accounts in India which have not been operated upon for 10 years giving
particulars of the deposits standing to the credit of each such account.
f. Under Gift tax act,1958- Section 36 of the Act empowers Gift tax Authorities to call for
information in respect of customer‘s account.
g. Disclosure to Police-Police Officers conducting an investigation may inspect banker‘s books.
h. Under FEMA,1999- Officers of the Directorate of Enforcement are empowered to inspect the
books and accounts and other documents of any authorized dealer in
i. Foreign Exchange.
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111
.
Banker‟s Rights:
General Lien- Section 171 of Indian Contract Act,1872 confers the right of general lien on the
bankers. The banker possesses the right of general lien on all goods and securities entrusted to him in
his capacity as a banker in absence of any contract inconsistent with the right of general lien. The
banker enjoys the privileges of a pledge and can dispose of the securities after giving proper notice.
Thus Banker‘s General Lien is an ―Implied Pledge‖.
Particular Lien- Section 170 of Indian Contract Act confer the right to retain possession only of goods
and securities for which dues have arisen and not for other dues.
Features of general lien:
a) No special contract is required
b) Right to sell is available
c) Not barred by limitation
Exceptions to general lien:
a) Safe Custody of articles
b) Documents deposited for special purpose
c) Right of general lien becomes that of particular lien
d) Securities left with the bank by mistake
e) Securities held in trust
f) Securities lodged before the loan is granted
g) Money Deposited ( right of set-off applicable)
Banker‟s Right of Set-off:
Banker has statutory right of set off i.e. to combine two or more accounts, one of which is in debit,
other is in credit, in the same branch or in different branches subject to the following conditions:
a) The accounts must be in the same name and in the same right
b) Prior notice is to be given for exercising the right of set off
c) Debts should be certain ( time barred debts also) and due immediately and not future debts
d) Right of set off can be exercised before Garnishee Order is made effective
Termination of Banker-Customer Relationship:
The relationship terminates in the following events:
a) Customer closes the account
b) Bank closes the account by giving due notice
c) On death of the customer
d) In case of insanity/Insolvency of the customer
e) On receipt of garnishee order/attachment order( relationship gets suspended)
Garnishee Order:
It is an order issued by a court under Sec.60 of Code of Civil Procedure 1908 for attachment of funds
of the judgement debtor available with the bank.
The bank is ―Garnishee‖ in this case
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112
.
Has got two parts- 1) Order Nishee- Simply attaches the account 2) Order absolute- Directs amount to
be paid to the court.
Garnishee Order attaches
a) All deposit a/cs. of the judgement debtor with credit balance already due or accruing due for
payment
b) Accounts in the same capacity in which the order is issued
c) Amount debited to the judgement debtor‘s a/c but actual payment has not yet been effected
d) Individual a/cs when order is in the name of the joint a/c of the individuals.
e) Partners‘ individual a/cs when order is in the Firm‘s name.
f) Attaches accounts of the Judgement Debtor with branches even if it is served on Head Office of the
bank.
Garnishee Order does not attach
a) Joint a/c of the Judgement Debtors if the order is in the name of one individual of the joint a/c.
b) Amount deposited in the a/c. after receipt of the order.
c) Uncleared Instruments
d) Amount paid before receipt of the order
e) Money held abroad
f) Amount held in Trust
Income Tax Attachment Order:
Under Section 226(3) of the Indian Income Tax Act,1961,, the Income Tax Officer may attach i) any
debt due and payable, ii) debts due but not payable on the date of receipt of the notice and iii) any
amount received subsequently on account of the income tax dues of the assessee.
Income tax attachment orders issued in the assessee‘s account attaches joint account of the
assessee. The share of the joint holders in such account shall be presumed, until contrary is proved,
to be equal.
Nomination facility:
 Nomination facility was introduced under Section 45 ZA to 45ZF of Banking Regulation
Act,1949.
 Nomination facility is available in Single a/c, Joint a/c, Proprietorship a/c and Safe Custody a/c
and Lockers
 Nomination should be in favour of an individual only and not in representative capacity.
 Nomination in favour of more than one person in jointly operated Locker Accounts with
common consent.
 Nomination can be made, cancelled or varied any number of times.
 In case of death of one of the depositors in joint account with survivorship clause, the survivor
can make, cancel or vary nomination any number of times.
 A minor can be a nominee; but a major person has to be appointed who will receive the money
on behalf of the minor during his minority in case of death of the depositor. Such major person
may not even be related to the minor.
 In a minor‘s a/c nomination can be made by a person lawfully entitled to do so i.e. by natural
guardian or guardian appointed by court.
 Nominee is entitled to receive the money. He is duty bound to pass on the money to the legal
heir.
 Bank gets full discharge by making payment to the nominee.
Deceased‟s Account: Settlement of Claims:
a) Where nomination is available
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113
.
Nature of
the account
Single
Depositor
Joint A/c
(operated jointly)
Joint A/c
( E or S)
Savings/Curr
ent
Nominee
1.On the death of
one depositor:Legal Heirs of
the deceased
Plus the
survivors
2.On the death of
all depositors:Nominee
-Do-( On maturity
of deposit)
1.On the
death of one
depositor:Survivors
2.On the
death of all
depositors:Nominee
Term Deposit
Joint A/c.
(Former/Latt
er/or
Survivor)
1.On the
death of one
depositor:Survivors
2.On the
death of all
depositors:Nominee
Joint A/c
(Anyone or
survivor)
1.On the
death of one
depositor:Survivors
2.On the
death of all
depositors:Nominee
-Do-( On
-Do-( On
-Do-( On
-Do-( On
maturity of
maturity of
maturity of
maturity of
deposit)
deposit)
deposit)
deposit)
Premature
-Do-( As per
-Do-( As per terms -Do-( As per
-Do-( As per
-Do-( As per
withdrawal of terms of
of contract)
terms of
terms of
terms of
FD
contract)
contract)
contract)
contract)
b) Where nomination not done:
Nature of the Single
Joint A/c
Joint A/c
Joint A/c.
Joint A/c
account
Depositor
(operated
( E or S)
(Former/Latt (Anyone or
jointly)
er/or
survivor)
Survivor)
Savings/Curr Legal Heirs or 1.On the
1.On the
1.On the
1.On the
ent
person
death of one
death of one
death of one
death of one
mandated by depositor:depositor:depositor:depositor:Legal Heirs
Survivors
Survivors
Legal Heirs
them
of the
of the
2.On the
2.On the
deceased
deceased
death of all
death of all
Plus the
Plus the
depositors:depositors:survivors
Legal Heirs
Legal Heirs
survivors2.O
of all the
of all the
2.On the
n the death of
depositors
depositors
death of all
all
depositors:depositors:Legal Heirs
Legal Heirs
of all the
of all the
depositors
depositors
Term Deposit -Do-( On
-Do-( On
-Do-( On
-Do-( On
-Do-( On
maturity of
maturity of
maturity of
maturity of
maturity of
deposit)
deposit)
deposit)
deposit)
deposit)
Premature
-Do-( As per
-Do-( As per
-Do-( As per
-Do-( As per
-Do-( As per
withdrawal of terms of
terms of
terms of
terms of
terms of
FD
contract)
contract)
contract)
contract)
contract)
No Surety required where claim is settled on the basis of nomination.
For claim amount or the value of the contents of locker/safe custody articles upto Rs.50000/- without
any nomination no surety required.
For claim amount or the value of the contents of locker/safe custody articles exceeding Rs.50000/without any nomination surety requirement is as under:
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114
.
a) Two sureties jointly having worth twice the amount of claim or
b) One surety having worth twice the amount of claim.
Deceased claim to be settled in 15 days from the date of submission claim documents
complete in all respect.
Negotiable Instruments Act,1881
Negotiable Instruments:
Negotiable Instruments Act does not define negotiable instruments. It merely states that a negotiable
instrument means a promissory note, bill of exchange or cheque payable either to order or bearer(
Section-13)
Promissory Note, Bill of Exchange and Cheque are Negotiable Instruments (NI) by statute.
Hundis, Delivery Orders , Railway Receipts ,Warehouse receipt, Certificate of Deposit, Commercial
Paper, Treasury Bills and GRs approved by IBA are examples of negotiable instruments by usage or
custom.
Essential features of Negotiable Instruments:i. These are easily transferable from one person to another,
ii. These confer absolute and good title on the transferee,
iii. The holder can sue upon the instrument in his own name.
Presumptions as to Negotiable Instruments:Section 118 provides the following presumptions as to Nis until the contrary is proved:
a) NI was made, drawn, accepted, endorsed and negotiated or transferred for consideration
b) It bears the date on which it was made or drawn
c) It was accepted within a reasonable time after its date and before maturity
d) Every transfer of NIs was made before maturity
e) Endorsements appearing on NIs were made in the order in which they appear thereon.
f) It was duly stamped and stamp duty cancelled, when the NI stands lost
g) Holder is holder in due course.
Features of Pronote:
Section 4 of NI Act- It is an instrument a) in writing b) containing an unconditional undertaking or
promise c) signed by maker d) to pay a certain sum of money e) to or to the order of a certain person
or to the bearer of the instrument.
A pronote may be drawn by more than one person who may undertake to pay the amount both in their
individual capacities as well as jointly.
There are only two parties in a pronote- Maker (the borrower) and the Payee( to whom payable).
Examples of Pronote- I promise to pay B or order Rs 2000.00
I acknowledge a debt of Rs 5000.00 to B to be paid on demand.
Mere acknowledgement of debt without a promise to pay will not make it a pronote- Example-I owe
you Rs 3000.00.
Absence of unconditional undertaking will not make it a pronote- Example- I promise to pay B
Rs.5000.00 after the death of C, provided C leaves me the sum of Rs 5000.00
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115
.
Currency Notes are pronotes payable to bearer on demand. Suction 31 of RBI Act,1934 prohibits any
other person or institution from issuing pronotes payable to bearer on demand.
Essentials of a Pronote
1) It must be in writing :
2) Promise to pay : The promissory note must contain an express promise or undertaking to pay. An
implied undertaking cannot make a document a promissory note.
3) The promise to pay must be unconditional : The promise to pay must be unconditional or
subject to only such conditions which according to the ordinary experience of mankind is bound to
happen.
4) There must be a promise to pay money only : The instrument must be payable only in money.
5) A definite sum of money : Certainty
i. as to the amount, and
ii. as to the persons by whose order and to whom payment is to be made
6) The instrument must be signed by the maker : A promissory note is incomplete till it is so
signed. Since the signature is intended to authenticate the instrument it can be on any part of the
instrument.
7) The person to whom the promise is made must be a definite person : The payee must be a
certain person. Where the name of the payee is not mentioned as a party, the instrument becomes
invalid. It is to be kept in mind that a promissory note cannot be made payable maker himself. Thus, a
note which runs ―I promise to pay myself‖ is not a promissory note and hence invalid.
Features of Bill of Exchange:
Section 5 o NI Act- It is an instrument a) in writing b) containing an unconditional order c) signed by
maker d) directing a certain person e) to pay a certain sum of money e) to or to the order of a certain
person or to the bearer of the instrument.
There are three parties in a Bill of Exchange
Drawer- Maker of the bill
Drawee- The person who is directed to pay
Payee- The person who is entitled to receive payment
Features of Cheque:
Section 6 of NI Act- It is a) a bill of exchange b) drawn on a specified banker and c) not expressed to
be payable otherwise on demand.
There are three parties in a cheque.
Drawer- The person who issues the cheque
Drawee- The banker on whom the cheque is drawn
Payee- To whom payable
Electronic/Truncated Cheques-After the amendment of NI Act during Dec,2002, the cheque also
means a cheque in electronic form containing exact mirror image of a paper cheque with use of digital
signatures and asymmetric crypto system.
Holder:
Section 8 of NI Act- A person may be called Holder of a negotiable instrument provided
1) He is entitled to the possession of the instrument in his own name.
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116
.
Actual possession of the instrument is not essential. He must have legal rights to possess the
instrument in his own name i.e title to the instrument should be acquired lawfully. Thus a person who
has obtained a negotiable instrument by theft, fraud, through forged endorsement or finds the same
lying somewhere is not a holder of the instrument.
2) He must be entitled to receive or recover the amount from the parties concerned in his own name.
For this purpose his name should appear on the instrument as payee or endorsee, if it is an order
instrument. If it is a bearer instrument, the bearer may claim the money without having his name
mentioned in the cheque.
In case of a lost instrument, the person who was entitled to receive payment at the time the instrument
was lost continues to remain as Holder and not the person who finds the instrument.
Rights of a Holder:
Holder of a Negotiable instrument enjoys the following rights
1. He can claim payment of the instrument and can sue on the instrument in his own name.
2. He can obtain a duplicate instrument if lost.
3. He can cross the cheque generally or specially and also with the words ‗Not Negotiable‘
4. He can convert an endorsement in blank into endorsement in full.
5. He can endorse and negotiate the instrument, if not restricted as per direction on the cheque.
Holder in due course:
Section 9 of NI Act – It means a holder who takes the instrument bonafide for value before it is
overdue and without any notice of defects in the title of the person who transferred it to him.
Pre-requisites for being Holder in due course:
A person who claims to be holder in due course of an instrument has to prove
a. That he is a holder
b. That he is a holder for consideration
c. That the acquisition of the instrument was before its maturity
d. That he has no knowledge of defective title
e. That the instrument was complete at the time of possession
Privileges of a holder in due course:
A holder in due course enjoys the following privileges:
1. Inchoate Instrument- Right of Holder in due course to recover the money is not affected in case of
an originally inchoate instrument subsequently completed for greater sum inconsistent with the
intention of the maker.
2. Title free from defects- His title is free from defects. He always possess better title than that of the
transferor and also all previous parties. He passes better title to subsequent parties.
3. Liability of prior parties- He can recover the amount of the instrument from any or all of the
previous parties to the instrument.(Section 36)
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117
.
4. Lost or obtained by fraud or unlawful consideration- A person liable on a negotiable instrument
cannot defend himself against a holder in due course on the ground that the instrument was lost or
obtained from him by means of an offence or for an unlawful consideration (Section 58)
5. Estoppel against denying validity of the instrument originally made : ―No maker of a
promissory note and no drawer of a bill of exchange or cheque and no acceptor of a bill of exchange
for the honour of the drawer shall in a suit thereon by holder in due course, be permitted to deny the
validity of the instrument as originally made or drawn‖(Section 120)
6. Payees incapacity: No maker of a promissory note and no acceptor of a bill of exchange payable
to order shall, in a suit thereon by a holder in due course, be permitted to deny the payee‘s capacity at
the date of note or bill to endorse the same. (Section 121).
7. Title of previous parties : No endorser of a negotiable instrument shall in a suit thereon by a
subsequent holder, be permitted to deny the signature or capacity of any prior party to the instrument
(section 122) .
8. Fictitious Bill : If a bill of exchange is drawn on behalf of a fictitious person and is payable to his
order, the acceptor is not relieved of his liability to the holder in due course because of the fictitious
name. It is essential though that the holder in due course proves that the document bears the
endorsement with signature in the same hand as that of the drawer and purporting to be made by the
drawer (Section 42).
Distinction between Holder & Holder in due course:
Distinction between Holder & Holder in due course:
Holder
Holder in Due Course
A holder may become the possessor or payee of A holder in due course is one who acquires
an instrument even without consideration,
possession for consideration.
Payment in due course:
Section 10 of the NI Act – The essentials for a payment in due course are:
(i) Payment as per apparent tenor: The payment should be made in accordance with the apparent
tenor of the instrument. A payment before maturity is not a payment in accordance with the apparent
tenor of the instrument; and as such it is not a payment in due course.
(ii) Payment to a person in possession: That the person to whom payment is made should be in
possession of the instrument. Therefore, payment must be made to the ―holder‖ or a person
authorized to receive payment on his behalf. Suppose, the instrument is payable to a particular person
or order and is not endorsed by him. Payment to any person in actual possession of the instrument in
such case, will not amount to payment in due course. However, in the event of the instrument being
payable to bearer or endorsed in blank, the payment to a person who possess the instrument is, in the
absence of suspicious circumstances, payment in due course.
(iii) Payment in good faith: If suspicious circumstances are there, then person making the payment
shall be put on an enquiry. If he does not make the enquiry, the payment would not be in due course.
Negotiation:
Section 14 of NI Act- Transferring an instrument from one to another in a manner as to convey title
and to constitute the transferee,the holder thereof.
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.
Negotiation by delivery- Bearer instruments get negotiated by delivery only(Section-47).
Negotiation by endorsement and delivery- Order instruments are negotiated by endorsement and
delivery ( Section 48).
Endorsement:
Section 15 of NI Act- It means signing by the maker or holder on the face or back of the instrument or
on a paper annexed thereto called ‘allonge‘ for the purpose of negotiation.
Types of Endorsement:
Blank or general – When the endorser signs his name for negotiation without adding anything the
endorsement is blank or general endorsement.
Special or in full- When the endorser signs his name and adds a direction to pay the amount to or to
the order of a specified person,the endorsement is special or in full.
Restrictive – Section 50 permits restrictive endorsements which take away the negotiability of such
instruments. ―Pay the contents to C only‖, ―Pay C for my use.‖
Conditional :
(i) Sans Recourse – when endorser excludes his liability ―pay to X or order at his own risk‖ or ―Pay to
C without recourse to me.‖
(iii) Facultative – When the endorser reduces rights or increases his liability by writing in the
endorsement ― notice of dishonour waived.‖.
Liability of endorser on dishonour:
Under Section 35 that except in the case of a contract to contrary, every endorser of a negotiable
instrument is liable to every subsequent party to it provided due notice of dishonour is given to or
received by him.
Example : A bill is drawn by A upon B and is payable to C or order. C endorses the bill to D, who in
turn endorses it to E. If B dishonours the bill, the holder, E has a right of action against all the parties
i.e. D, C and A.
Effect of endorsement:
The endorsement of an instrument, followed by delivery, transfers to the endorsee the property in the
instrument with right of further negotiation i.e. the endorsee may further endorse it to some other
person.
A holder of an instrument deriving title from a holder in due course has rights thereon of the holder in
due course (Section 53).
Negotiation by unauthorized parties:
Right and liabilities in case of loss of instrument
1. The holder of negotiable instrument shall give a notice to all parties liable on the instruments. He
shall also give a public notice.
2. Under Section 45A, the loser of a bill of exchange has a right to apply to the drawer for a duplicate
of the lost bill, giving security to the drawer to indemnify him against all persons. If the drawer does not
grant the application the loser may compel him to provide him with a duplicate.
3. When a negotiable instrument payable to order has been lost, the finder or the endorsee from the
finder, is not entitled to receive the amount of it from maker, acceptor or holder, or from any party prior
to such holder. He is bound to return the instrument to the real owner.
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119
.
4. If the instrument lost by one is payable to bearer or endorsed in blank, the third person acquiring it
bona fide and for valuable consideration before maturity, is entitled both to retain the instrument
against the real owner and to compel payment from the prior parties thereon i.e. if the possessor of a
lost instrument is a holder of it in due course, he is entitled to receive the amount due thereon from the
acceptor or holder or from any party prior to such holder.
5. The holder of the lost instrument shall give a notice for payment on maturity date to the drawer. If
the drawer or acceptor refuses payment, he must give notice of dishonour to the drawer, acceptor as
well as to all prior parties failing which he will lose his right to take action against the person liable on
the instrument.
Stolen instrument
The position in case of stolen instrument is same as in the case of lost instrument. The thief does not
get any title to the instrument. But, if a stolen instrument, payable to bearer, is negotiated to a holder
in due course, such holder in due course gets a good title.
Instruments obtained by fraud:
Free consent of parties is one of the most important for a valid contract. Absence of consent or
absence of free consent vitiates all contracts including contracts relating to negotiable instruments.
Thus, if an instrument is obtained from any maker, acceptor or holder by means of an offence or fraud,
the possessor is not ordinarily entitled to receive the amount under it from the acceptor or holder, or
from any party prior to such holder. But if such instrument, payable to bearer is transferred to holder in
due course he will get good title. Even if the instrument is negotiated by endorsement, the holder in
due course gets good title. The endorsement will be valid though the title of the endorser is defective.
Forged Endorsement :
When signature of the endorser is forged on the instrument it is said to be a forged endorsement. In
the eyes of law, a forged endorsement is not an endorsement at all.
If the instrument is payable to a person or to his order, it cannot be negotiated except with the
signature of the person. Therefore, if the instrument is negotiated under the forged signature of the
person to whom the instrument has been made payable the endorsee does not receive any title even
though he is a purchaser for value and in good faith, for the endorsement is a nullity. But in case of
bearer instrument or instruments endorsed in blank which can be negotiated by mere delivery, a
forged endorsement is immaterial and it does not affect the title of the holder because he derives his
title through delivery and not through endorsement.
Material alteration:
Material alteration is that change in the negotiable instrument which affects the validity of the
instrument or rights of the parties thereto. Validity of the instrument is affected only when the alteration
is material. Any material alteration of a negotiable instrument renders the same void as against any
one who is party thereto at the time of making such alterations. Following have been held to be
material alterations :
i. Alterations of the date of the instrument
ii. Alteration of the sum payable
iii. Alteration in the place of payment
iv. Alteration in the names of the parties
v. Substitution of the word ‗bearer‘ in place of ‗order‘ in the cheque
vi. Alteration in the crossing of the cheque
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120
.
A change is said to be material when –
i. it changes the identity of the contract between the parties
ii. it changes the rights and liabilities of the parties of the parties or any of the parties of the instrument.
iii. It alters the operation of the instrument.
Crossing of Cheques:
Section 123 of NI Act- Crossing is made by drawing two parallel traverse lines across the face of the
cheque with or without the addition of ― and Company‖ or any abbreviation thereof or with the words‖
not negotiable‖.
Crossing on a cheque is a direction to the paying banker that the payment shall not be made across
the counter. The payment on a crossed cheque can be collected only through a banker.
Who may cross the cheque:
Crossing of a cheque is an instance of an alteration which is authorized by the Act. Thus, the following
parties may cross a cheque :
Drawer : The drawer of the cheque may cross the cheque generally or specially.
Holder : Where the drawer does not cross the cheque, the holder may cross it generally or specially.
Even if the cheque is already crossed the holder may add the words ‗not negotiable‘.
Banker : Where a cheque crossed specially the collecting banker may again cross it specially to
another banker as its agent for collection.
Types of crossing:
Crossing may be either (1) general or (2) special.
1. General crossing : Section 123 of the NI Act - Where a cheque bears across its face two traverse
lines with or without the words ―and Co.‖ or any abbreviation thereof or the words ‗not negotiable, the
cheque is said to have been crossed generally.
2. Special crossing Special crossing implies the specifications of the name of the banker on the face
of the cheque. The object of special crossing is to direct the drawee banker to pay the cheque only if it
is presented through the particular bank mentioned.
In the case of special crossing the addition of two parallel transverse lines is not essential though
generally the name of the bank to which the cheque is crossed specially is written between the two
parallel transverse line (Section 124).
Where a cheque is crossed specially, the banker on whom it is drawn shall not pay it otherwise than to
the banker to whom it is crossed, or his agent for collection( Section 126)
Where a cheque is crossed specially to more than one banker, except when crossed to an agent for
the purpose of collection, the banker on whom it is drawn shall refuse payment thereof (Section127)
“Account Payee” crossing:
NI Act has not defined this type of crossing. It is the result of custom,use,practice and legal decision.
This type of crossing acts as a warning to the collecting bankers that the proceeds are to be credited
into the account of the payee. The banker can disregard the direction only at his own risk and
responsibility.
Cheque marked “not negotiable”:
___________________________________________________________________________________
121
.
Section 130 of the NI Act: A person who takes a cheque crossed generally or specially with the words
‗not negotiable‘ shall not have or shall not be able to give a better title to the cheque than the title of
person from whom he took it.
The general rule about the negotiability is that the holder in due course of a bill or promissory note or
cheque takes the instrument free from any defect which might be existing in the title of the transferor.
If the holder takes the instrument in good faith, before maturity and for valuable consideration, his
claim is not defeated or affected by the defective title of the transferor. In case of any dispute, it is the
transferor with the defective title who is liable.
The effect of such a crossing is that the title of the transferee would be vitiated by the defect in the title
of the transferor. The transferee of such a crossed cheque cannot get a better title than the transferor
himself. The transferee cannot claim the right of a holder in due course by proving that he purchased
the instrument in good faith for value.
Banker‟s liability on payment of crossed cheque in due course
In respect of a crossed cheque it is presumed that the banker, on whom it is drawn, has made
payment to the true owner of the cheque, though in fact, the amount of the cheque may not reach the
true owner. In other words, the banker making payment in due course is protected, whether the
money is or is not, in fact, received by the true owner of the cheque (Section 128).
Banker‟s liability on wrong payment of a crossed cheque:
Section 126 of the Act states that:
i. in the case of generally crossed cheque the banker shall not pay it otherwise than to a banker, and
ii. in the case of a specially crossed cheque it shall not be paid by the banker otherwise than to the
banker to whom it is crossed or to his agent for collection.
Where the drawee banker pays a crossed cheque otherwise than in accordance with the provisions of
Section 126 it shall be liable to the true owner of the cheque for any loss he may have sustained
(section 129)
Protection of paying banker in respect of uncrossed cheques:
Section 85(2) reads:
When a banker makes payment on an uncrossed cheque in due course he is authorized to debit the
account of his customer with the amount so paid irrespective of the genuineness of the Endorsement
thereon.
For example, a cheque is drawn payable to N or order and it is stolen. Thereafter, the thief or
someone else forges N‘s endorsement and presents the cheque to the bank for encashment. On
paying the cheque, the banker would be able to debit the drawer‘s account with the amount of the
cheque.
The original character of the cheque issued as bearer, is not altered by subsequent endorsements , so
far as the paying bank is concerned, provided that the payment is made in due course. Hence the
proposition that ―once a bearer instrument always a bearer instrument‖.
Protection in respect of crossed cheques
When a banker pays a cheque drawn by his customer in accordance with section 126 of the Act he
can debit the drawer‘s account with the amount paid, even though the amount of the cheque does not
reach the true owner.
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122
.
Pre-requisites for claiming protection:
The protection in both the cases referred above can be availed of only if the payment has been made
in due course i.e.
i. According to the apparent tenor of the instrument,
ii. In good faith and without negligence.
iii. To any person in possession thereof,
iv. In circumstances that do not incite any suspicion that he is not entitled to receive payment of the
cheque.
Liability of drawee of cheque:
Section 31 of the Act states that:
The drawee bank is under a duty to pay the cheque, provided he has in his hands sufficient funds of
the drawer and the funds are properly applicable to such payment. If the banker refuses payment
without sufficient cause being shown, he must compensate the drawer, not the holder, for any loss
caused by such improper refusal (Section 31).
The amount of compensation that the drawee would have to pay to the drawer is to be measured by
the loss or damage say loss of credit, suffered by the drawer. The principle is : ―The lesser the value
of the cheque dishonoured, the greater the damage to the credit of the drawer‖.
Collecting Banker‟s Protection:
Section 131 of the Act confers a special protection on the collecting banker which is available to him
subject to fulfillment of certain conditions. If the following conditions do not co-exist, this protection
would be denied to the collecting banker :
1. Payment must be received in good faith and without negligence What amounts to negligence
is, however a question of fact in each case. ―Negligence‖ means want of ―reasonable care‖ with
reference to the interest of the true owner.
2. Collection for a customer : Protection under section 131 is available only when the banker is
acting as an agent for collection but not to a case where the banker is himself the holder.
3. Cheque should be a crossed cheque : The cheque should be a crossed one before it is
deposited with the collecting banker.
Dishonour of cheque is an offence:
Section 138 of the Negotiable Instruments Act states that
a) the return of a cheque by a banker because the money standing to the credit of the accountholder
is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from the
account by an agreement made with the bank, is a criminal offence.
b) The drawer shall be deemed to have committed an offence and such offence will be punishable
with imprisonment for a term up to two years imprisonment or with a fine twice the amount of the
cheque or both.
Provisions of section 138 of the Act are applicable only if –
1. Cheque has been issued in discharge of liability- gift cheques are not included.
2. Cheque should be presented within the validity period of the cheque
3. Payee or Holder in due course should give notice demanding payment within 30 days from the date
of notice of dishonor
4. The drawer is required to pay within 15 days of receipt of the demand notice.
5. The dishonor should be for no other reason than ― insufficiency of funds‖
6. The complaint can be made only by the payee or holder in due course.
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123
.
7. No court inferior to Metropolitan Magistrate or Judicial Magistrate of 1st class will try the offence.
Inland bills :
As per Section 11 of the NI Act
i. It must be drawn or made in India
ii. It must be payable in India
Foreign bills :
As per Section 12 of the NI Act foreign bills are
i. Bills drawn in India but are payable outside India or are drawn on a person residing outside India or
ii. Bills drawn outside India and are payable in India or are drawn on a person resident in India
iii. Bills drawn in India and are payable outside India or drawn on a person residing outside India and
are payable outside India.
Presentment of a bill:
As per Section 83 of NI Act presentment of a bill should be made within 48 hours excluding public
holidays(public holiday includes Sundays)
Acceptor for Honour:
Acceptor for honour is a person who comes voluntarily for retirement of the bill.
Noting and Protesting:
In the event of dishonor of a Pronote or a Bill of Exchange the holder may get it noted by a Notary
Public on the instrument itself or on a paper attached thereto or partly upon each. This is called Noting
A protest is a certificate issued by the Notary Public attesting that the bill or note has been
dishonoured.
Escrow:
A bill, endorsed or delivered to a person subject to the understanding that it will be paid only if certain
conditions are fulfilled, is called an “Escrow”. Regarding these bills there is no liability of the
drawer until the conditions agreed are fulfilled. However, the rights of a holder in due course will not
be affected.
Charges on Securities:
Different types of charges
Securities
Immovable Property
Deposits
Movable Property
Book
Debts/Actionable
Claims
Charge
Mortgage
Lien
Hypothecation or Pledge
Assignment
Distinction between Hypothecation & Pledge:
Pledge
Hypothecation
Defined
Definition
Nature of Charge
SRFAESI Act,2002( Section 2n)
Indian Contract Act,1872 ( Section
172)
Charge on movable property in favour Deliv Delivery of goods as security for
of the secured creditor without payment of a debt or performance of
delivery of possession
promise
Equitable charge
Legal Fixed Charge
___________________________________________________________________________________
124
.
Possession
With the borrower but in trust for the With the bank till repayment of debt is
bank
done. Bank has to preserve the goods
carefully and deliver back on
repayment of debt.
Delivery of goods
Borrower to deliver the goods if Possession already with the bank,
demanded by the bank
either actual or constructive,
Registration
of In case borrower is a Company under No registration required
Charge
Section 125 of Companies Act,1956
Right to sale
General Lien
Under SRFAESI Act, possible after Available after giving notice
taking possession
Not available
Available under section 171 of Indian
Contract Act.
Assignment:
Assignment is transfer of actionable claim, which may be existing or future
As per section 3 of the Transfer of Property Act 1882, an actionable claim means a claim to any debt
other than a debt secured by mortgage, pledge or hypothecation and property not in possession of the
claimant.
The actionable claim can be in existence, accruing, conditional or contingent
LIC policy is an actionable claim because it is a debt payable by LIC for which the policy holder does
not have any security in the form of mortgage, pledge or hypothecation of assets of LIC
Mortgage:
Sec. 58 of the Transfer of Property Act, 1882 defines mortgage as A mortgage is the transfer of an interest in specific immoveable property for the purpose of securing
the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the
performance of an engagement which may give rise to a pecuniary liability. The transferor is called a
mortgagor, the transferee a mortgagee; the principal money and interest of which payment is secured
for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is
effected is called a mortgage-deed.
Simple Mortgage - In a Simple mortgage, the possession of the mortgaged property is not transferred
from mortgagor to the mortgagee. If the mortgagor fails to repay the loan, the mortgagee has the right
to sell the property and recover the loan from the sale amount.
Mortgage by Conditional Sale Under such Mortgage, the mortgagor apparently sells the property to the mortgagee on certain
conditions - 1.On failure to repay the mortgage money before a certain date the sale shall become
absolute,or 2.On condition that on such repayment of mortgage money the sale shall become
invalid,or 3.On condition that on such repayment the mortgagee shall retransfer the property. In such
case, the mortgagee is a "mortgagee by conditional sale"
Usufructuary Mortgage - In a usufructuary Mortgage, the possession of the mortgaged property is
transferred to the mortgagee. The mortgagee receives the income from the property (rent, profit,
interest, etc) until the repayment of the loan. The title deeds remain with the owner.
English Mortgage - In an English Mortgage - 1.The mortgagor binds himself to repay the borrowed
money on a certain date. 2.The mortgagor transfers the property absolutely to the mortgagee. 3.But
such transfer is subject to the condition that the mortgagee will retransfer the property on repayment
before the agreed date.
___________________________________________________________________________________
125
.
Mortgage by deposit of title deeds – In such mortgage, the mortgagor delivers the title document of
the property to the mortgagee with an intention to create a security thereon. Such mortgage is valid in
towns of Kolkata, Mumbai and any other town as the State Government may notify by publication in
Official Gazette
Anomalous mortgage - Anomalous mortgage is a combination of different types of mortgages.
Provisioning Coverage Ratio:
Provisioning Coverage Ratio (PCR) is essentially the ratio of provisioning to gross non-performing
assets and indicates the extent of funds a bank has kept aside to cover loan losses.
Specific provisions against NPAs as well as floating provisions together should not be less than 70 per
cent.
RATIO ANALYSIS
LIABILITIES
NET WORTH/EQUITY/OWNED FUNDS
Share Capital/Partner‘s Capital/Paid up Capital/
Owners Funds
Reserves ( General, Capital, Revaluation &Other
Reserves)
Credit Balance in P&L A/c
ASSETS
FIXED ASSETS : LAND & BUILDING, PLANT &
MACHINERIES
Original Value Less Accumulated Depreciation
Net Value or Written down value
LONG
TERM
LIABILITIES/BORROWED
FUNDS : Term Loans (Banks & Financial
Institutions)
Debentures/Bonds, Unsecured Loans, Fixed
Deposits, Other Long Term Liabilities
NON CURRENT ASSETS
Investments in non-quoted shares & securities
Old stocks or old/disputed book debts
Security Deposits
Other Misc. assets which are not current or fixed
in nature
CURRENT LIABILTIES
CURRENT ASSETS: Cash & Bank Balance,
Marketable/
Short
term
Bank
borrowingssuch
as quoted Govt. or other securities, Book
CC/OD/Bills/Export Credit
Debts/SundryDebtors/BillsReceivables, Stocks &
Sundry Creditors/Bills Payable, Short duration inventories(RM,SIP,FG)
Stores
&Spares,
loans or deposits
Advance Payment of Taxes, Prepaid expenses,
Expenses payable &provisions against various Loans and Advances recoverable within 12
items
months
INTANGIBLE ASSETS
Patents & Trade Mark , Goodwill, Debit balance in
P&L A/c, Preliminary or Preoperative expenses






Liabilities have Credit balance and Assets have Debit balance
Current Liabilities are those which have either become due for payment or shall fall due for
payment within the next 12 months from the date of Balance Sheet
Current Assets are those which are convertible into cash within the next 12 months. These are
also called Working Capital or Gross Working Capital
Net Worth & Long Term Liabilities are also called Long Term Sources of Funds
Current Liabilities are known as Short Term Sources of Funds
Long Term Liabilities & Short Term Liabilities are also called Outside Liabilities
___________________________________________________________________________________
126

.
Current Assets are Short Term Use of Funds
Net Working Capital= Excess of Long Term Sources of Funds over Long Term Uses
Current Assets : Raw Material, Stores, Spares, Work-in Progress. Finished Goods, Debtors, Bills
Receivables, Cash etc.
Current Liabilities : Sundry Creditors, Installments of Term Loan, DPG etc. payable within one year
and other liabilities payable within one year.
Current Ratio:
1. Current Ratio is arrived at by dividing the Current Assets by the Current Liabilities
2. Current Ratio measures short term liquidity of the concern and its ability to meet its short term
obligations within a time span of a year.
3. It shows the liquidity position of the enterprise and its ability to meet current obligations in time.
4. Higher ratio may be good from the point of view of creditors. In the long run very high current ratio
may affect profitability ( e.g. high inventory carrying cost)
5. Shows the liquidity at a particular point of time. The position can change immediately after that date.
So trend of the current ratio over the years is to be analyzed.
6. Current Ratio is to be studied with the changes of NWC. It is also necessary to look at this ratio
along with the Debt-Equity ratio.
7. This ratio should be at least 1.33 : 1 to ensure minimum margin of 25% of current assets as margin
from long term sources.
ACID TEST or QUICK RATIO : It is the ratio between Quick Current Assets and Current Liabilities.
The should be at least equal to 1.
Quick Current Assets : Total Current Assets minus Stock.
Acid Test or Quick Ratio = Quick Current Assets/Current Liabilities
DEBT EQUITY RATIO : It is the relationship between Outside Debt and Owner‘s Capital (Equity).
Long Term Outside Liabilities / Tangible Net Worth
Tangible Net Worth: Total of Capital and Reserves & Surplus Less Intangible Assets
OPERATING PROFIT RATIO : (Operating Profit / Net Sales ) x 100 Higher the ratio higher the
operational efficiency
NET PROFIT RATIO : Net Profit / Net Sales x 100 (It measures overall profitability)
STOCK/INVENTORY TURNOVER RATIO :
Average Inventory/Sales x 360 for days
Average Inventory or Stocks = (Opening Stock + Closing Stock)
This ratio indicates the number of times the inventory is rotated during the relevant accounting period
DEBTORS TURNOVER RATIO :
This is also called Debtors Velocity or Average Collection Period or Period of Credit allowed to the
customers.
Average Debtors/Sales x 365 for days
ASSET TRUNOVER RATIO : Net Sales/Tangible Assets
FIXED ASSET TURNOVER RATIO : Net Sales /Fixed Assets
CURRENT ASSET TURNOVER RATIO : Net Sales / Current Assets
___________________________________________________________________________________
127
.
CREDITORS TURNOVER RATIO : This is also called Creditors Velocity Ratio, which determines the
creditor payment period.
(Average Creditors/Purchases)x365 for days (52 for weeks & 12 for months)
RETRUN ON ASSETS :
Net Profit after Taxes/Total Assets
RETRUN ON CAPITAL EMPLOYED :
Net Profit before Interest & Tax /( Average Capital Employed) x 100
Average Capital Employed is the average of the equity share capital and long term funds provided by
the owners and the creditors of the firm at the beginning and end of the accounting period.
RETRUN ON EQUITY CAPITAL (ROE) :
Net Profit after Taxes / Tangible Net Worth
EARNING PER SHARE :
EPS indicates the quantum of net profit of the year that would be ranking for dividend for each share
of the company being held by the equity share holders.
Net profit after Taxes and Preference Dividend/ No. of Equity Shares
PRICE EARNING RATIO :
PE Ratio indicates the number of times the Earning Per Share is covered by its market price.
Market Price Per Equity Share/Earning Per Share
DEBT SERVICE COVERAGE RATIO :
This ratio is one of the most important one which indicates the ability of an enterprise to meet its
liabilities by way of payment of installments of Term Loans and Interest thereon out of the cash
accruals and forms the basis for fixation of the repayment schedule in respect of the Term Loans
raised for a project. (The Ideal DSCR Ratio is considered to be 2 )
PAT + Depreciation. + Annual Interest on Long Term Loans
--------------------------------------------------------------------------------Annual interest on Long Term Loans + Annual Installments payable on Long Term Loans
NOTE :Foundation Day Campaign for PS & Retail (Non-ps) advances - Each Region has been
allocated a target of Rs.100 Crore for increase level of advances under PS & Retail lending for
the campaign period. (cir no. HO Retail/ 43/14-15/846 dated 23-01-15)
DISCLAIMER: The contents in this booklet are based on Information collected from various
sources which we believe to be reliable. However, we do not hold ourselves responsible for
any short comings or error therein.
___________________________________________________________________________________
128

Indian Banking Structure - All India Oriental Bank Officers` Association

Transcription

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