summer internship project report on union bank of india
vishnu internship Project
1. Mahatma Gandhi Mission
Institute of Management Studies & Research
MGM Educational Campus, Sector 18, Kamothe, Navi Mumbai – 410 209
PROJECT REPORT
ON
“A Study Of Bajaj Finserv Consumer Durable Loan
Procedure And Expansion Of Business Model To Deal
With Emerging Market”
SUBMITTED TO
MGM’S INSTITUTE OF MANAGEMENT STUDIES &
RESEARCH, NAVI MUMBAI
BY
VISHNU SINGH
Roll No. 53
Batch No 2015-2017
IN PARTIAL FULFILLMENT OF
MASTER OF MANAGEMENT STUDIES (MMS),
UNIVERSITY OF MUMBAI
May, 2016
2. Table ofC O N TE N TS
Chapt
er No.
Title PageNo.
Declaration from student II
Certificate from
Company/Organization
III
CertificatefromGuide IV
Acknowledgement V
List of table VI
List of chart VI
Executive Summary VII
I Introduction 1
1.1 Background Of The Study 2
1.2 Organization Structure 2
1.3 Product Profile Of The
Company
3
1.4 Current Financial
Statements
3
1.5 Vision And Mission Of
The Organization
4
1.6 Future Plan Of The
Organization
4
1.7 Board Of Directors 5
1.8 Products Covered 5-6
1.9 Background Of The Topic 6
1.10 What Is finance? 6
1.11 Who is consumer?
1.12 Consumer Finance 6
1.13 Consumer Durable Finance 7-8
1.14 Need Of The Study 8
1.14 Scope Of The Study 9
1.15 Objectives Of The Study 9
II ResearchMethodology 10
2.1 Research design 11
2.2 Sources ofdata 11
2.3 Questionnaire 11-12
2.4 limitation 12
2.5 Key concept 13
III Data Processing and
Analysis
14
Analysis and interpretation 15-22
Customer feedback
Deployment and
23
Deployment and trend
performance
explanation
eexpexplnantion
25-26
Loan procedure and related case
study
26-36
Diversified business model 40
IV Findings 44
V Conclusions 45
VI Recommendations 46
Bibliography 47
Appendices /Annexure 48
3. DECLARATION
I Mr. Vishnu Singh,
hereby declare that this project report is the record of authentic work carried out by me during
the period from May to June and has not been submitted to any other University or Institute for
the award ofany degree diploma etc.
Signature :
Name of the student: VishnuSingh
Date:
II
4. CERTIFICATE
This is to certify that Mr. Vishnu Singh of MGM Institute of Management Studies &
Research has successfully completed the project work titled “A Study Of Bajaj Finserv
Consumer Durable Loan Procedure And Expansion Of Business Model To Deal With
Emerging Market” in partial fulfillment of requirement for the completion of MMS as
prescribed by the University of Mumbai.
This project report is the record ofauthentic work carried out by her during the period from
May to June 2016.
He has worked under my guidance.
Signature:
Name: Prof. Satarupa Nayak
Project Guide (Internal)
Date:
Counter signed by:
Signature :
Name: Dr. D. Henry
Director
Date:
III
6. ACKNOWLEDGEMENT
I consider it a privilege to express a few words of gratitude and respect
to all who guided and inspired me in successful completion of this
project .
I am thankful to Mr. Mrunal Jawale (Sales Manager) BAJAJ FINSERV LENDING. For
giving this project to me and giving me an opportunity to work with such
an esteemed organization .
It is my sincere duty to do my best ,so as to be recognized as one
amongst the most successful professional ,which I will always try to bring
fame and laurels to my beloved institution, the MGM Institute of Management
Studies & Research .
I also thank in particular our Director Dr. D Henry and my Project Guide Prof.
Satarupa Nayak for guiding me in my project. I would also like to thank
all the teaching and all others staff who helped me directly or indirectly
in the successful completion of this project .
V
7. List of tables
Chapt
er No
Title PageNo.
1 Financial Statements 3
2 Scheme Chart 13
3 Performance Trend 24
3 Distribution Performance
Geographic
Wise
43
List of Charts
Chapt
er No
Title Page No.
1 Organization structure 2-3
3 Questionnaire 15-22
3 Deployment chart 23
3 Illustration chart 37
3 Business model 40
3 Distribution map 42
VI
8. EXECUTIVE SUMMARY
I have taken marketing as a specialization with the title of “A STUDY OF BAJAJ
FINSERV CONSUMER DURABLE LOAN PROCEDURE AND EXPANSION OF
BUSNESS MODEL TO DEAL WITH EMERGING MARKET “The objective behind
this project was to primarily focus on Modus Operandi of Bajaj Finance for Finance of
Consumer Durable products. This required a firsthand experience in understanding end to
end process flow for loans processing to payment disbursement. I was working in
Kohinoor tele video pvt ltd located in ghodbandar thane. I have collected the first hand data
of own experience of my working as well as secondary data from Books, Company Annual
Report & internet Articles etc. Bajaj Finserv was the first company who started purely
consumer durable loan segment.
I also focused on the surrogates required for loan approval, which documents are
necessary for approval of loan and also to show the SWOT analysis of Company. I have
also tried to explain the loan procedure and its approval by enclosing some case studies.
Through this project, I learn now days what are the approach and preferences of the
customer towards consumer durable loan product and how to solve customer difficulties
regarding the documentation. I was dealing with proper customer, provided them loans by
completing their files and getting the approval online form Bajaj Server called as
“Galaxies” Portal. This process helped me to better understand the Loan procedure of
Consumer durable product at Bajaj Finserv Lending.
VII
10. 1.1Background of the study
Bajaj Finserv was formed in April 2007 which is situated in 4TH Floor, Bajaj Finserv
Corporate Office, Pune-Ahemednager Road Viman Nagar, Pune 411014, and
Maharashtra. As a result of its demerger from Bajaj Auto Limited to act as a pure play
financial services business. The process of demerger was completed in Feb 2008. This
demerger was not only to unlock values in the high growth business areas of Auto,
Insurance, Finance sectors and Wind Power but also to run independently these core
businesses and to strengthen the competencies. In addition to that cash and cash equivalent
of INR 8,000 million (then market value) was also transferred to the company. The
demerger has enabled investors to hold separate focused stocks and also facilitate
transparent benchmarking of the companies
To their peers in their respective
1.2 ORGANIZATION STRUCTURE
Figure no 1.1 organization structure
2
11. 1.3 PRODUCT PROFILE OF THE COMPANY
Figure no 1.2 company profile
1.4 CURRENT FINANCIAL STATMENTS
Particular FY2016 FY2015 CHANGE
in
(%)
Total income 7384 5418 36
Interest and finance
charges
2927 2248 30
Net interest income 4457 3170 41
Salary cost 630 451 40
Marketing commission 96 61 57
Dealer incentives 290 208 39
Recovery cost 233 204 14
Loan loss and
provision
543 385 41
Depreciation 56 36 56
Other expenses 644 468 38
Profit before tax 1965 1357 45
Profit after tax 1279 898 42
Earnings Per Share
(EPS) Basic, In rupees
242.30 179.94 35
Book Value Per
Share, In rupees
1386.87 959.93 45
Figure no 1.3 financial statements
3
12. 1.5 Vision and Mission of the Organization:
Vision:
Bajaj Finserv has a vision to become a full-fledged financial services company and be the
financial partner to the Indian consumer and help him across his financial needs, whether
for finance, for investment management, for protection or for post-retirement support,
throughout his lifecycle.
Mission:
Bajaj Finserv aims to be the most useful, reliable and efficient provider of Financial
Services. It is our continuous endeavor to be a trustworthy advisor to our clients, helping
them achieve their financial goals.
1.6 Future Plan of the Organization
Application for Banking License:
Bajaj Finance may have failed to get a banking license in the first round last year. The
company has not given up its hope of becoming a bank. Jain says whenever the
Reserve Bank of India invites applications for new licenses, Bajaj Finance would be
interested. for that Rajiv jain has made 5 years road map
Tap rural market area for increase the cross sale volume.
4
13. 1.7 BOARD OF DIRECTORS
Rahul Bajaj
Chairman
Nanoo Pamnani Sanjiv Jain
Vice Chairman Vice Chairman
Rajeev Jain
Managing Director and CEO
1.8 PRODUCTS COVERED
Almost all brands of Consumer Durable products like TV, refrigerator so on.
All lifestyle products.
IT products.
CROSS SELL:
Insurance, extended warranty.
5
14. LATEST Other products coveredunder EMI option
Apparels
Watches
Dentist
Food category
1.9 BACKGROUND OF THE TOPIC
1.10 What is Finance?
"Finance is the management of money and other valuables, which can be easily converted
into cash."
A category of stocks containing firms that provides financial services to commercial and
retail customer. This sector includes banks, investment funds, insurance companies and
real estate. Financial services perform best in low interest rate environments. A large
portion of this sector generates revenue from mortgages and loans, which gain value as
interest rates drop. Furthermore, when the business cycle is in an upswing, the financial
sector benefits from additional investment improved economic condition usually lead to
more capital projects and increased personal investing.
New projects require financing, which usually leads to a large number of loans.
“Finance” is often defined simply as the management of money or “funds” management.
Modern finance, however, is a family of business activity that include the origination,
marketing, and management of cash and money surrogates through a variety of capital
accounts, instruments, and markets created for transaction and trading assets, liabilities,
and risks. Finance is conceptualized, structured, and regulated by a complex system of
power relation within political economies across state and global market.
1.11 Who is consumer?
An individual who buys products or services for personal use and not for manufacture or
resale. A consumer is someone who can make the decision whether or not to purchase an
item at the store, and someone who can be influenced by marketing and advertisements.
Any time someone goes to a store and purchases a toy, shirt, beverage, or anything else,
they are making that decision as a consumer.
Under the consumer protection act 1985 ‘‘any person who buy any goods for
consideration, who include a person who obtain such goods for resale or for any
commercial purpose”.
6
15. 1.12 Consumer Finance
“The division of retail banking that deals with lending money to consumers. This includes
a wide variety of loans, including credit cards, mortgage loans, and auto loans, and can also
be used to refer to loans taken out at either the prime rate or the subprime rate.”
The consumer finance is a win-win system in which everyone wins. For the consumers it
is an opportunity to upgrade standard of living here and now instead of waiting for years of
savings to accumulate. For manufacturer, consumer finance stimulates demand and
brings down inventories. For dealers it is one type of sales booting. For finance
company it is profit generation.
Consumer finance has to do with the lending process that occurs betweenthe consumer and
a lender. In some instances, the lender may be a bank or financial institution. At other
times, the lender may be a business that offers in house credit in exchange for the business
of the consumer. Consumer finance can include just about any type of lending activity that
result in the extension of credit to a consumer.
1.13 ConsumerDurable Finance
“Consumer durable finance means to provide the finance on the consumer durable product
like, washing machinist, TV etc. it is known as consumer durable finance”
The consumer durable finance provide the 0% interest on durable product to the consumer,
This gives customers another compelling reason to opt for 0% interest Consumer Durables
Finance for their durables purchases. Consumer durables finance schemes are generally
available at the dealer location (point of sale) or the showroom. The beneficiaries are not
just customers – lenders, manufacturers, and retailers too benefit. Manufacturers gain from
the resultant boost to sales and increased consumer preference towards high-margin
products. Financing schemes enable customers, especially those with lower income levels,
to use future income streams to buy consumer products upfront and pay in installments
over a period.
The most popular finance scheme prevalent in the market currently is the 12/4 scheme,
where the financier collects the amount for the first four months as initial down payment
from the buyer and then disburses the full amount to the dealer. The financier thenrecovers
the balance amount in 8 monthly installments from the buyer. The interest and processing
charges are generally paid upfront by the manufacturer to the financier. Consumer durables
financing appears robust, continued support from manufacturers (who are effectively
bearing the interest costs currently) would be critical to sustain high growth.
EMI Card (Easy Monthly Installments)
Bajaj Finserv Lending launched an innovative product in 2011-12 for its existing
Consumer Durables Finance customers.
7
16. Through the EMI card, an existing customer can buy any consumer durable by
simply swiping the EMI card across our dealer partner outlets, without the need for
any repeated documentation.
This is another industry first, leveraging the technology investments the company
has made and is a proof point of our commitment to investing in growing our
relationship with our existing customers.
Tracking methodology of customer is very smoothly (by using EMI card).
Advantages of consumer durable loan
The Bajaj Fiserv Lending providing pre payment facility to the customers they can
reduce their EMI or tenor or both by repaying their loan on time. Customer can repay up to
6 times in a calendar year at any interval with the minimum amount per prepay transaction
being not less than 3 EMI’s. Also there is no limit on the maximum amount (subject to his
credit performance).
The Bajaj finance was who started providing 0% finance options only with Bajaj
Finserv Lending. (select schemes are interest bearing)
The Bajaj finance also offers you special flexible repayment options.
The customer can get approval for a loan in anywhere between 3 to 15 minutes.
Tracking methodology of customer is very smoothly (by using EMI card).
Customer can take Extended Warranty from Bajaj which can be convert into
EMI’s and secure his product.
1.14 Needfor study
In the urban areas 50% of people are taking the loan from Bajaj finance and other
finance when they purchase consumer Durable product due to EMIs facility.
The customers are spending more their money for consumer durable products
compare to earlier when EMI was not in market.
CD loan also create business opportunity to its other business model.
The customer was not pay the total amount at the time but dealer gets paid for his
product within 5-7 days whereas consumer pay money in average 8 month without paying
anything extra.
This point tells Bajaj is playing the key role on consumer durable loans. The Bajaj
finance was observed that they are providing good financial facility to the customers.
8
17. 1.15 Scope for study
Current position is dominant by Bajaj Finserv in consumer loan but now many competitors
entering in the market which reducing new customer penetration of Bajaj. So how Bajaj
diversified its business model in consumer loan with new products/services and offer.
Especially HDFC bank who harming by using his credit card advantage.
1.16 Objectives Of The Study
To know awareness of CD loan among consumers
To find benefits of EMI card for customers
To find reason behind customer preferences toward Bajaj Finance
To know how the new competitors are performing compared to Bajaj
09
19. 2.1 Research Design
Researchdesign is a planof action, a plan for collectingand analyzing data in aneconomic,
efficient and relevant manner
Type of Research
Descriptive Research:
Descriptive research can be used to accomplish a wide variety of research objectives.
Descriptive research includes Surveys and fact-finding enquiries of different kinds. The
main characteristic of this method is that the researcher has no control over the variables;
he can only report what has happened or what is happening.
2.2 Sources of Data
The study is descriptive in nature, makes use of both type of data i.e. Primary and
Secondary.
Primary data:
The data that is collected first hand by someone specifically for the purpose of facilitating
the study is known as primary data. So in this research the data is collected from
respondents through questionnaire.
Secondarydata:
I had used secondary data like the annual reports of the company, working experience,
Books
Articles, Magazines, Company website, Research papers, MBA projects, Internet.
2.3 QUESTIONNAIRE DESIGNFORMULATION
Under this method, list of questions pertaining to the survey are prepared for consumers of
Bajaj Finserv in Kohinoor televideo at thane.
Questionnaire has structured type questions as well as unstructured type questions.
Structured objective type questions are prepared for the respondents with fixed response
categories. Some of the questions are of multiple-choice type. The questions have more
than one alternative.
Questionnaire: A questionnaire consists of a set ofquestions presented to respondent for
their answers. It can be Closed Ended or Open Ended
Open Ended: Allows respondents to answer in their own words & are difficult to Interpret
and Tabulate.
Close Ended: Pre-specify all the possible answers & are easy to Interpret and Tabulate.
11
20. TYPES OF QUESTION INCLUDED:
DICHOTOMOUS QUESTIONS
which has only two answers “Yes” or “No”?
MULTIPLE CHOICE QUESTIONS
where respondent is offered more than two choices.
IMPORTANCE SCALES
A scale that rates the importance of some attribute.
RATING SCALE
A scale that rates some attribute from “highly satisfied ” to “highly unsatisfied “ and “very
inefficient” to “very efficient” Analysis of Data:
The researcher analyses the data with the help of Case Studies, Percentage, Tables, and
Graphs.
SAMPLE SIZE
sample size of respondent 200.
2.4 Limitation Of The Project:
The geographical area was very much limited so the results are not particularly reflection
of the aggregate behavior.
1. The study is restricted to consumer durable loan in Kohinoor televedio only.
2. Sometimes customer may be biased due to dissatisfied of restricted policies of EMI
procedure.
3. Loan procedure of other retail outlet can be differ which is not taken into
consideration.
4. As the market being very huge it was not possible to cover all area.
5. The data collected may not representation of entire population.
12
21. 2.5 Key Concepts:
Lending:
A person or organization that makes a loan That is, a lender gives money to a borrower
with the expectation of repayment in a timely manner, almost always with interest.
Surrogates:
A surrogate means document requirement criteria for loan approval process.
Bajaj Dedupe:
Bajaj Dedupe means there is problem occurred in the previous Bajaj loan.
Scheme Chart:
Various types of schemes are given below:
Schemes Description
12/4 It means the 4months payment will be taken as an advance and
remaining payment will be distributed in 8 months.
10/2 It means the 2 months payment will be taken as an advance
and remaining payment will be distributed in 8 months.
18/6 It means the 6 months payment will be taken as an advance
and remaining payment will be distributed in 12 months. And
it is long term scheme.
24/6 It means the 6 months payment will be taken as an advance
and remaining payment will be distributed in 18 months. And
it also long term scheme.
10/0 It means there is no any advance payment will be taken, all
payment will be distributed in 10 months.
Figure no 2.1 scheme chart
13
23. 1. Are You Aware About Consumer Durable Loan Availability?
Interpretation
Above figure clearly shows that how Bajaj company succesful to urge the cosumers about
Consumer durable loan. Its considerd important because company started this business
when many big loan firm closed down its business for consumer loan cause of recession in
2008-09 whereas Bajaj were able to assesse the future demand and now you cansee how in
above chart that how this industry is booming.
15
yes
92%
no
8%
24. 2. Have You Ever TakenConumer Durable Loan?
Interpretation
Because of Consumer Durable loan facility customer can think to buy any durable product
with latest technology easily. Which wasn’t the case earlier when they have to think twice
before buying tv,fridge etc. end of 20th century only higher middle class and above people
had all that CR Tv,refridgerator,air condtioner etc. but above data shows Consumer
Durable loan created not only desire but also created willingness among the consumer to
purchase products.
16
yes
70%
no
20%
not sure
10%
25. 3.Do You Own EMI Card Of BajajFinserv?
Interpretation
There are many reason that why Bajaj Finserv is most succesful in lending industry. One of
the most important part is its vastly higher technology and EMI card idea was one of them.
which helping them to retain their 80-90% customer. also almost 60% Bajaj customer has
EMI card. other those are not sure most of them might have card but because of they don’t
often buy products they dont carry or misplaced it.
17
yes
58%
no
28%
not sure
14%
26. 4. Which Payment Mode You Feel Is Convenient To Buy Consumer
Durable Products?
Interpretation
By seeing above figure its seems customer more prefer to buy products on cash but its only
in numbers. It was found that 30% customer willing to buy product throgh Bajaj Finserv
While asking to another set of consumers who were quite educated in terms of value for
money by considering all the points they highly recomanded in favour for Emi facility.
18
bajaj emi
30%
cash
45%
creditcrad
20%
all ofabove
5%
27. 5.ScaleEffectivenessOf BajajEMI Card
Interpretation
Response from customer for utility of EMI card says its play vital role while taking
Consumer Durable loan. More people are stuck to 4 rating because of it certain condition
are attach to it. Otherwise it is very much accepted and effective by cosnumers.
19
1
2
3
4
5
10 15 40
105
30
28. 6.Which Finance Company You Will Prefer For Consumer Durable
Loan?
Interpretations
Bajaj Finserv has fast process compare to competitors and also providing good after sale
service throgh Bajaj App.which conumer can access anwhere and do all the transaction like
Loan Account Access, Change Address, Pre-Closer Of Loan, Complaint Logs etc.
20
bajaj
62%
capital first
23%
Hdfc
10%
other
5%
29. 7.Which SectionOf ConsumerTaking Loan?
Interpretations
Above figure is showing that still Bajaj Finserv is growing more than 50%.which indiactes
there are manyoppourtunitycoming up for Bajaj as in today time.consumers with High Per
Capita Income has more awareness about Consumer Durable loan.
21
EXISTING
45%
NEW
55%
30. 8 .MostPreferable Scheme Opted By Consumer?
Interpretations
12/4 is the most desirable scheme which most of the customer like to take. This scheme
doesn’t carry any processing fee. Promotional scheme often carry processing fee as
resulting to least prefer by cutomer And more awareness about consumer durable loan.
22
124
62%
102
23%
184
10%
promotional
5%
31. Customerfeedback
Here is the feedback of customer from different bank account holders and their opinion
about Bajaj Finserv service after and before.
23
32. 3.1 Gross Loan Deployment of Bajaj Finserv
Figure no 3.1 deployment chart
Figure no 3.2 business performance year by year
24
33. Figure no 3.3 performance trend
Explanation:
Consumer Durable business:
Continued its strong momentum and disbursed 667K cases in Q2 (YOY growth of 37%).
Extended summer and delayed monsoon with proactive capability builds, geo expansion
and category extensions have helped deliver solid growth momentum in first half.
Lifestyle Finance business:
Disbursed 82 K accounts (241 % growth) which was highest for any quarter driven by
Digital products. The tie-ups with leading manufacturers like Samsung, Apple, Sony and
leading national & regional wireless chains enabled the business register this growth.
However furniture financing business grew only by 25% YOY due to de-growth in the
furniture industry. Making structural changes to bring in dedicated focus.
Cross sell:
Momentum across Lending and Fee products remained strong.
Salaried personal loans business:
Continued to grow well with healthy credit performance. Digital channels now contribute
16% of new originations.
Rural Lending business:
Is tracking ahead of plan and the business has started to be profitable. Company continues
to increase its footprint in a measured manner. MSME rural lending launch planning has
been initiated and is expected to go live by April 15.
Business loans business:
continued to grow very well with strong credit performance. Professional business loans
now contribute to 15% of Business loans origination.
Mortgage business:
Remained in a consolidation mode post May2014 incident. Specific set of initiatives are in
progress to re-energize the business.
25
34. LAS business:
Had an excellent quarter supported by new product & renewed channels strategy.
Construction Equipment business:
is now down to 320 Crs and is in remedial mode. The portfolio is reducing by 25 crs a
month and will fully run off by September 2015.
Interpretation:
The above graph shows loan deployment of the year, as per the sectors, the growth of the
consumer finance sector is more rapidly as compared to the other SME finance and
commercial lending sector.
Cross selling also boost because of business expansion of consumer durable including
lifestyle product.
The loan process for CD loan (including life style product)
Required documents:
The following are the eligibility criteria to apply for a loan:
o If you are a salaried person your age should be between 21 years to 60
years.
o If you are Self Employed your age should be between 23 years to 65
years.
All above documentation doesn’t mean customer would get loan 100%. Case
study will clear all these possibilities.
26
Photo Id Proof
Residence proof
One cancelled cheque in case of ECS
Credit program specific documents ( Any one of the following)
Credit Card front side photocopy
Visiting Card & Employee Id proof
PhotocopyofRC book(Not applicable for
vehicles registered after 2004 & commercial cars)
Bajaj Finserv Lending existing loan Repayment Loan
Account Number / Schedule (subject to not later
than 18 months old)
Any other Bank/NBFC Repayment Schedule
Salary Slip
Banking Details (latest 6 months) Account Type- OD/ CC
35. Case study
Case No.1
Name of the Applicant Mr. Ranjeet Kumar
Age 35 year
Permanent Address Mahatma Gandhi Road
Nehru Nagar, Near Rajouri Garden
New Delhi-110021
Residential Address Gulmohar Park, ITI Road
near ICICI Bank, Aundh
Pune -411007
Occupation Service
Company Name SunGard, pune
Salary 1, 00,000/-PM
Purchase of Products
I. Samsung LED TV
II. Samsung Washing Machine
Cost of Products
I. Rs.40,000
II. Rs.35,000
Document Required for Loan
I. Address Proof:-Bank Statement
II. ID Proof: - Pan Card or Voting Card or Driving License.
III. Income Proof:-SBI Credit Card (Platinum)
Problem Address Proof
Mr.Ranjeet Kumar has the address proof but this Address Proof of other city, so as per loan
requirement address proof should be of current city
27
36. Name of the Applicant - Mr.Ranjeet Kumar
Table No.3.4 Case Study 1
Solution:-
a. Calculation of EMI and Down payment:
Scheme-:12/4 (Ref.Table No.3.1)
Cost of Product-: Rs.75, 000
Down payment -:Rs.25, 000 (Rs.75, 000/12*4)
EMI-: Rs.6250*8 Month= Rs.50, 000
b. How to Approve the Loan:
I. Minimum Required Salary for taken a loan –Rs.8000/-and Above, So Mr.Ranjeet
Kumar has Rs.80000/-PM Salary so he is applicable for loan.
II. As an address proof for taken a loan it is must to Mr.Ranjeet Kumar to submit either
Rent agreement or credit card statement which is on current city address.
III. As an ID proof requirement he should be provide voting card or PAN Card or Passport.
28
Particular Eligibility criteria for
loan approval
Applicable
for Loan
Occupation Service
Company Name SunGard
Salary Rs.9,60,000 PA
House Rented
Place(Stay) Aundh
Document
Required
Address Proof Bank Statement
ID Proof PAN Card ,Voting
Card
Credit Card SBI Credit Card
(Platinum)
Products
Samsung 40’
LED TV
Rs.40,000
Samsung
Washing
Machine
Rs.35,000
37. Case No.2
Name of the Applicant Ms.Smita Badiyani
Age 26 year
Residential Address Bramha Village, Behind Jyoti Restaurant,
near Bharat Petrol pump, Kondhwa
Pune -411048
Occupation Service
Company Name Infosys, Pune
Salary 50,000/-PM
Purchase of Products
I. LG Refrigerator
Cost of Products
I. Rs.36,000
Document Required for Loan
I. Address Proof:-Rent Agreements
II. ID Proof: - Pan Card or Voting Card or Driving License. And marriage Certificate.
III. Income Proof:-3 Month Bank Statement.
Problem ID Proof
As per the documents require for the approval of loan, Ms.Smita Badiyani should
submit the ID Proof of she’s current name.
Name of the applicant - Ms.Smita Badiyani
29
38. Table No.3.5: Case Study 2
Particular Eligibility criteria
for loan approval
Applicable
for Loan
Occupation Service
Company Name Infosys
Salary Rs.6,00,000 PA
House Rented
Place Kondhwa
Document
Required
Address Proof Rent Agreement
ID Proof Marriage Certificate
Bank Statement 3 Month bank
statement
Product
LG Refrigerator Rs.36,000
Solution:
a. Calculation of EMI and Down payment:
Scheme-:12/4(Ref.Table No.3.1)
Cost of product-:Rs.36, 000
Down payment-: Rs.12, 000 (Rs.36, 000/12*4)
EMI-: Rs.3000*8 Month = Rs.24, 000
b. How to approve the Loan:
I. She has the 50,000 PM salary; the minimum salary should be 8000 PM, so she is
applicable for the loan.
II. As per the requirement of loan approval document, if lender leaves on the Rent
bases then he or she should submit the Rent agreement which would be on Rs.1000/- stamp
paper. This document criteria fulfilled by Ms.Smita Badiyani.
III. For the ID Proof required the PAN Card, Voting Card and Driving Licenses.
Ms. Badiyani has the PAN Card but problem is that she’s is not having the current name
i.e. after marriage on the PAN Card. For solving this problem, we have taken the Marriage
Certificate along with PAN Card Copy.
IV. For the Income Proof required Credit Card, or ExistingCustomer or anybank loan
as well as 3 Month Bank Statement, So she have the 3 Month Bank Statement from Feb to
May, and also her 780 score in CIBIL records.
30
39. Case No.3
Name of the Applicant Mr.Anurag Kasat
Age 45year
Residential Address Shree Niwas, ITI Road,
near Croma Showroom,aundh
Pune -411007
Occupation Service
Company Name Mahindra and Mahindra
Salary 50,000/-PM
Purchase of Products I Sony LED TV
Cost of Products I Rs.52, 000
Document Required for Loan
I. Address Proof:-Electricity Bill, Telephone Bill, Passport
II. ID Proof: - Pan Card or Voting Card or Driving License or Passport
III. Income Proof:-HDFC Credit
Problem System Error
Mr. Anurag Kasat has all the required documents but the actual problem in system, the
system shows the Bajaj Dedupe Error it means there is problem in the loan database of
Bajaj Finserv lending.
Name of the applicant:-Mr.Anurag Kasat (Existing Customer)
31
40. Table No.3.6: Case Study 3
Particular Eligibility criteria
for loan approval
Applicable
for Loan
Occupation Service
Company Name Mahindra and
Mahindra
Salary Rs.6,00,000 PA
House Own
Place Aundh
Document
Required
Address Proof Passport
ID Proof Passport
Credit Card HDFC Bank
Product
Sony LED Rs.52,000
Solution:-
a. Calculation of EMI and Down payment:
Scheme: 10/0 (Ref.Table No.3.1)
Cost of product: Rs.52, 000
Down Payment: Rs.250 (Processing Fess)
EMI: Rs.5200*10 Month=Rs.52, 000
b. How to approve the loan:
I. Mr.Anurag Kasat has the Existing Customer of Bajaj Finserv Lending, for the
Existing Customer canpay the down payment through cash as well as credit or Debit Card.
So Mr.Kasat pays the down payment by cash
II. Due to the system Error the loan has been rejected, When the Mr.Kasat has
produced the copy of NOC to the Bajaj Finserv Lending. Then the Company sorts out his
problem by updating the previous loan history of Mr.Kasat.
III. For reflecting the database changes system required the duration of one month so
after reflecting the changes his loan get approved.
32
41. Case No.4
Name of the Applicant Mr.Akshay Kadam
Age 27 year
Residential Address Swapnagari society, ajmera
Near H.A.Ground Pimpri,
Pune -411018
Occupation Service
Company Name Alfa Laval
Salary 30,000/-PM
Purchase of Products
I. Sony LED TV
I. Samsung Washing Machine
Cost of Products
I. Rs.42,000
II. Rs.30,000
Document Required for Loan
I. Address Proof:-Electricity Bill, Telephone Bill, Passport
II. ID Proof: - Pan Card or Voting Card or Driving License or Passport
III. Income Proof:-ICICI Bank Credit Card
Problem ID Proof Name
Name of Mr.Akshay kadam on the credit card and Pan Card is mismatch i.e.Akshay
Kadam on credit card and AAkaash KKadam on PAN Card.
33
42. Name of the applicant:-Mr.Akshay Kadam
Table No.3.7: Case Study 4
Particular Eligibility criteria
for loan approval
Applicable
for Loan
Occupation Service
Company Name Alfa Laval
Salary Rs.3,60,000 PA
House Own
Place Pimpri
Document
Required
Address Proof Electricity Bill
ID Proof Pan Card
Product
Sony LED Rs.42,000
Samsung washing
Machine
Rs.30,000
Solution:-
a) Calculation of EMI and Down payment:
b) How to approve the Loan:
I. Mr.Akshay Kadam has the entire document i.e. Address Proof, ID Proof, and
Income Proof, but he is only having the problem with ID Proof.
II. For solving the ID Proof problem we have taken the Govt.Gadget Letter from him.
34
Particular Sony Samsung
Scheme 18/4 12/4
Cost of
product
Rs.42,000 Rs.30,000
Down
Payment
Rs.9,336
(Rs.42,000/18*4)
Rs.10,000(Rs.30,000/12*4)
EMI Rs.2,334*14
Month=Rs.32,676
Rs.2,500*8
Month=Rs.20,000
43. Case No.5
Name of the Applicant Mr. Avinash Thite
Age 50 years
Permanent Address Karve Road, near
Dashabhuja Ganesh Temple,
Kothrud Pune-411004
Occupation Own Business
Company Name Omkar Trading
Purchase of Products
I. Sony LED TV
II. Sony Home Theater
Cost of Products
I. Rs.52,000
II. Rs.35,000
Document Required for Loan
I. Address Proof:-Electricity Bill, Index-II, Telephone Bill.
II. ID Proof: - Pan Card, Voting Card, Driving License. And Passport.
III. Income Proof: - Credit Card, Any Bank Loan.
Problem Case rejected due to less CIBIL Score
CIBIL Scores Required Criteria:-
Minimum CIBIL Score required for loan approval is 750 or more; Mr.Avinash Thite has
710 CIBIL Score, His score below the criteria so loan has been rejected.
4.2.1: Application Process For Loan Approval:
First pitch the customer,after pitching the customer the next process is to explore
them overall loan process of 0% interest sceheme .Once the customer is agreed, then ask
the customer for the required documents like ID-proof, Address proof i.e voter ID,driving
licence,aadhar card and cancelled cheque etc to approve the loan.After compliting the
submition procedure of documentation,the next step is to decide the surrogate of the
customer.
35
44. Customer should be fill up the application form,then the details of customer get
stored by the executives in to the sales force softwear.
Once all this loan process is done, the unique case ID will be generates. Thenall the
control goes in to the hand of company approval department.
After approval of loan , customer should sign the agreement document (which
includes the terms and conditions), then next process is to generate the invoice of loan and
product amount.
On the basis of invoice,memo of disbursement is gets generate.
Along with the loan procedure documents, disbursment memo will get forward to
the bajaj finserv , Pune branch office premises. Then all the attached documents are
scrutinze by the operational department of bajaj finserv’s.
Once the loan procedure of the company is satisfied then this douments get sealed
by the approval stamp.
36
46. Surrogates Requiredfor Loan Approval:
There are three types policy are as below:
A.WOW Policy
B.WOW Lite Policy
C.WOW Extension Policy
A.WOW Policy:
WOW Policy mostly used for those customer who are in the listed companies, have the
credit card, as per the rule of company the maximum Loan to Value(LTV) 83% to 90% it
depend on the customer document.
Following are the Surrogates included in that Policy:
2.1 Credit Card (Max LTV 83% up to 125000)
2.2 Listed Companies (Max LTV 90% up to 100000)
2.3 RC of Vehicle (Max LTV 83%)
2.5 Existing Customer (Max LTV 90% up to 50000)
2.6 CIBIL Score (Max LTV 90% up to 125000)
2.7 Salaried (Max LTV 90% up to 125000)
2.11 Instant
B.WOW Lite Policy:
WOW Lite Policy used for those customers whose net exposure is up to25000 to
35000.and as per the company rules the maximum Loan to Value (LTV) is 83% for all
surrogates.
Following are the Surrogates included in that Policy:
3.1 Credit Card (Max LTV 83% up to 35000)
3.2 Listed Companies (Max LTV 83% min salary 7500)
3.3 RC of Vehicle (Max LTV 83% up to 25000)
3.5 Existing Customer (Max LTV 83%)
3.6 CIBIL Score (Max LTV 83%)
3.7 Salaried (Max LTV 90% Min net salary 7500)
38
48. Diversified lending business model
2014-15
2013-14
2012-13
2011-12
2010-11
2009-10
2008–09
Figure no 3.11 diversification
Consumer Personal loan Insurance EMI Credit Card small product without EMI
Loans + Cross-sell + services + card + Partnership + IT product + card
Durables &
2-wheelers
+
Historical
business
model 3
data TAT.
No cross
sell
100%POS
Link up.3
Min-TAT
Started
PL.
cross sell
to existing
Good
customer
s
Launched
POS ins.
cross sell.
Launched
project
3sec-TA.
Launched
postsale
insurance
cross sell.
Launch
EMI card –
3
2nd
TAT
Launch
co brand
Credit
card.
Lifestyle Launched
virtual
card
Consumer finance
Cross-sellAcquisition
Competitive Advantage
• Data Mart and Cross sell capabilities
• Customer Lifecycle Management
• Low ticket - high volume transaction domain
Specialization
49. 40
Interpretation (figure 3.11)
Bajaj Finserv took gutsystep in 2008-09 to invest in consumer loanbusiness where many giants credit
organizationwas withdrawn fromconsumer loanbusiness as a consequence ofaffected bycrisis due to
poor credit record in 2008-09.
Then every year they launched unique and effective ideas products services and highly sophisticated
technology to increase sales. The key thing was Bajaj integrated its business very nicely so risk factor
always divided among business units.
In2102-13they madecustomer friendlysystemwherecustomer canuse hisemi card and getsapproved
loanin few minutes whichwas highlysuccessfully model for them.Now EMI card isthe main factor in
customer retention aswell as their services.
BajajFinservdisburse files gets doublewhentheystarted providing loanonlifestyle products like(small
appliances water purifier, all it products)
51. 42
Figure no 3.12 performance
Interpretation (figure 3.12)
Distribution is also one of the important factors that’s playing key role in Bajajfinserv
success. They quickly realize the value of placing the product. In 2010 to 2015 era
whereCD loandemand was increasingthat time Bajajhad executive ineachand every
store,merchant, shopswhoaredealing in durable products.
You can see that how the distribution were increase in between 2010 to 2015 all just
becauseofperfectstaffing and reaching byterritory.
52. 43
Chapter - IV
Findings
Bajaj Finserv became necessary for almost every consumer who wants to purchase
product on credit.
Other competitors are also slowly developing and creating business for them. Which
has been hurting Bajaj Finserv cross selling opportunity.
Bajaj Finserv has been rapidly growing in integrated technology. Virtual card, Retail
Finance is result of that.
some potential customers are diverting to competitors due to low cibil score although
they had good current record
Some EMI card holder get frustrated when they unable to get same process outside of
city.
Some customers are complaining that in some of retail outlet Bajaj Finserv is taking
processing fee like kings electronics, Kohinoor televideo, Snehanjali.
53. 44
Chapter – V
Conclusions
BajajFinservhas verystrong sales team in loan sector because it’s verychallenging task to
satisfy educated customer.
The project gives an insight to the awareness rate in the population of thane city.
Due to Bajaj Finserv lending, credit card sector get booster people started to show
willingness to disposal of their income
Bajaj Finserv now felling a pinch from their competitor specially by capital first,
HDFC
54. 45
Chapter-VI
Recommendations
Bajaj should revise their policy regarding cibil score.
Bajaj should provide loan to EMI card holder from outside the city at minimal
document i.e. as per available document with consumer.
They must increase their sales force on big day occasion like diwali, gudipadwa,
independence etc which can be give them 20-25% growth in sale at store. Because
insufficient manpower at many stores other finance company took advantage or consumer
moving to other finance.
Educate the customer that everywhere Bajaj Finserv process is standardized. some
dealer has own policy so they charge processing.
Educate the customer about Bajaj technology like Bajaj app, online approval which
are USP of Bajaj product and by all these customer has no need to go anywhere for his
problem it could be resolved by sitting at home only.
57. 48
1. Are You Aware About Consumer Durable Loan Availability?
a) Yes
b) No
2.Have You Ever TakenCD Loan?
a) Yes
b) No
c) Not sure
3.Do You Own EMI Card Of BajajFinserv?
a) Yes
b) No
c) Not sure
4. Which Payment Mode You Feel Is Convenient To Buy Consumer
Durable Products?
a) Bajaj
b) cash
c)credit card
d)any of above
5.ScaleEffectivenessOf BajajEMI Card
low
1
2
3
4
5
high
58. 49
6.Which Finance Company You Will Prefer For Consumer Durable
Loan?
a)Bajaj
b)capital first
c)HDFC
d)other
7.Which ConsumerAre Taking Loan?
a)existing
b)new
8.MostPreferable Scheme ByConsumer?
a) 12/4
b) 10/2
c) 18/4
d) Promotional
50
