A Summer Internship Project Report

On

“Analysis of Credit Cards Usage by the Customers &

Analysis of RE-KYC”

In Partial Fulfilment of the Requirements for the Award of Degree

of Bachelor of Business Administration

Supervision by: Submitted by:

Dr. Amandeep kaur Arsaphilabet Syiemlieh

Assistant Professor 20BBA2055

BBA V Semester

1
 DECLARATION

I, Arsaphilabet, undersigned solemnly declare that the report of the project work entitled
“Analysis of Credit Cards usage by the Customers & Analysis of RE-KYC” is based my
own work carried out during the course of my study under the supervision of Dr. Amandeep
kaur.

I assert that the statements made, and conclusions drawn are an outcome of the project work.
I further declare that to the best of my knowledge and belief that the project report does not
contain any part of any work which has been submitted for the award of Bachelor of Business
Administration in this University.

__________________________

(Signature of the Candidate)

Arsaphilabet Syiemlieh

20BBA2055

2
Certificate by Supervisor / Attached Summer Training Certificate

This to certify that the report of the project submitted is the outcome of the project work
entitled “Analysis of Credit Cards usage by the Customers & Analysis of RE-KYC”
carried out by Arsaphilabet Syiemlieh bearing Roll No. 20BBA2055 Carried by under my
guidance and supervision for the award of Degree in Bachelor of Business Administration of
Chandigarh University.

To the best of the my knowledge the report

I. Embodies the work of the candidate.

II. Has duly been completed,

III. Fulfills the requirement of the ordinance relating to the BBA degree of the University
and

IV. Is up to the desired standard for the purpose of which is submitted.

_______________________
(Signature of the Supervisor)
Mr. Sanket Sharma
Head Relationship Manager
HDFC Bank Ltd.
SCO – 74 – 75, Sector 8 – C,
Chandigarh, 160009

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 ACKNOWLEDGEMENT

A summer project is a golden opportunity for learning and self-development. I consider

myself very lucky and honoured to have so many wonderful people lead me through in
completion of this project. A formal statement of acknowledgement is hardly sufficient to
express my gratitude towards the personalities who have helped me to undertake and
complete my project.

I hereby covey my thanks to all those who have rendered their valuable help, support, and
guidance.

Firstly, I would like to thank Mr. Vinod Kumar (Branch Manager) for providing me an
opportunity to undergo this overwhelming learning experience at HDFC.

I would like to express my deep gratitude to Mr. Sanket Sharma (Head Relationship
Manager) and Mr. Deepak Garg (Relationship Manager) for helping me to cover my
project at HDFC and for his active guidance, Valuable advice, and constant inspiration during
the conduct.

Most importantly, I would like to express my deep gratitude towards My Parents for all their
encouragement, support, and affection. I would also like to thank all the sample respondents
at HDFC for providing the valuable inputs to my questionnaire.

_______________________

(Signature of the student)

Arsaphilabet Syiemlieh

20BBA2055

BBA V Semester

4
 TABLE OF CONTENT

S. No. TITLE PAGE No.

1 Abstract 6
2 Literature Review 7–8
3 Research Methodology 9
4 Objective of the Study 10
5 Introduction to Banking 11 – 13
6 About HDFC Bank 14 – 43
7 Introduction to Credit Cards 44 – 58
8 Data and Finding 59 – 64
9 Understanding KYC Norms 65 – 67
10 RE - KYC 68 – 70
11 Conclusion 71
12 Recommendation 72
13 Limitations 73
14 Bibliography 74

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ABSTRACT

The key idea in the research study is to identify the usage of credit cards by the customers
and Re-KYC of HDFC bank and the entire penetration observed by the bank customers
during the duration of 45 days.

The research project deals with the customer behaviour and the customer satisfaction level
taking in to view the usage and facilities given the bank to its premier customers.

The data is focused on walk – in – customers of the bank that would help in analysing the
common customer satisfaction with the bank.

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LITERATURE REVIEW
In India, credit card has been sourced at a maximum by private sector banks as compared to
the public sector banks as they have accelerated in the field of debit cards.

Number of credit cards in circulation across 5 Years

Aug 2017 Aug 2018 Aug 2019 Aug 2020 Aug 2021
Public Sector 4612899 5014566 5945667 6643678 7256899
Bank
Private 12940198 28765907 36528967 41578472 56436387
Sector Bank

Source: Reserve Bank of India website (www.rbi.org.in)

Overall growth in issuance of credit cards among public sector banks has been 12% faster
than Private sector banks at 8.13%. (UNDERSTANDING THE CREDIT AND DEBIT
CARD LANDSCAPE IN INDIA ACROSS PUBLIC SECTOR, PRIVATE SECTOR AND
FOREIGN BANKS MANOJ VARGHESE 1 MANGHAT AJIT MENON 2 1Dean, Xavier
Institute of Management & Entrepreneurship, Kochi 2Assistant Professor, Xavier Institute of
Management & Entrepreneurship, Kochi).

A stable and efficient banking sector is an essential precondition to increase the economic
level of a country. This paper tries to model and evaluate the efficiency of 50 Indian banks.
The Inefficiency can be analysed and quantified for every evaluated unit. The aim of this
paper is to estimate and compare efficiency of the banking sector in India. The analysis is
supposed to verify or reject the hypothesis whether the banking sector fulfils its
intermediation function sufficiently to compete with the global players.

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The results are insightful to the financial policy planner as it identifies priority areas for
different banks, which can improve the performance. This paper evaluates the performance of
Banking Sectors in India.

Private sector banks play an important role in development of Indian economy. After
liberalization the banking industry underwent major changes. The economic reforms totally
have changed the banking sector. The Indian banking industry was dominated by public
sector banks. But now the situations have changed new generation banks with used of
technology and professional management has gained a reasonable position in the banking
industry.

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RESEARCH METHODOLGY

DIRECT INTERVIEW: Direct interview involved the process of asking questions directly
to the consumer which helped in obtaining feedback and getting suggestions in regard to
demand and desire of the customer. It also helped in solving the issues and problems and
understanding the cause for the same.

SECONDARY DATA: It is the other source through which the data was collected. These
are the readily available sources of the data where one had need not put much effort to collect
and part in an elderly manner by some researcher, experts and special.

SAMPLE SIZE: By using judgement random sampling technique 95 respondent are selected
for the purpose of study.

PERIOD OF STUDY: The study is undertaken in the duration of 45 days.

RESEARCH APPROACH: The survey method was adopted for collecting the primary data
survey research is systematics gathering of data from respondents by regularly approaching
them.

RESEARCH INSTRUMENT: The data for this research study was collected by survey
technique using interview method guided by questionnaire.

COLLECTION OF DATA: Questionnaire method that I have used for the collection of
data.

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OBJECTIVES OF THE STUDY

 To understand the credit card industry and its growth in India.

 To study the key credit card facilities given by the banks to their different classes of
customers.

 To understand customer behaviour towards the plastic money.

 To obtain the usage of credit cards and digitalization by the customers.

 To identify the reasons for the lack of 100% credit card peneteration.

 To understand the KYC guidelines is to prevent banks from being used, intentionally
or unintentionally, by criminal elements for money laundering activities.
 KYC procedures also enable banks to know/understand their customers and their
financial dealings better which in turn help them manage their risks prudently.
 Banks should frame their KYC policies incorporating the following four key
elements:
o Customer Acceptance Policy
o Customer Identification Procedures
o Monitoring of Transactions
o Risk Management.

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 INTRODUCTION TO BANKING

HISTORY OF BANKING INDUSTRY:

The Reserve Bank of India (RBI), as the central bank of the country, closely monitors
developments in the whole financial sector.

Banking in India originated in the 18th Century. The oldest bank in existence in India is the
State Bank of India, a government-owned bank in 1806. SBI is the largest commercial bank
in the country. In 1809, it was renamed as the Bank of Bengal. This was one of the three
banks funded by a presidency government; the other two were the Bank of Bombay and the
Bank of Madras. The three banks were merged in 1921 to form the Imperia Bank of India,
which upon India’s Independence, became the State Bank of India in 1955. For many years
the presidency banks had acted as quasi-central banks, as did their successors, until the
Reserve Bank of India was established in 1935, under the Reserve Bank of India Act, 1934.
After the independence, Reserve Bank of India was nationalized and given wide powers.

In 1960, the State Bank of India was given control of eight state associated banks under the
State Bank of India (Subsidiary Banks) Act, 1959. These are now called its associate banks.
In 1960 the Indian government nationalized 14 major private banks. In 1980, 6 more private
banks were nationalised. These nationalised banks are the majority of lenders in the Indian
economy. They dominate the banking sector because of their large size and widespread
networks.

The Indian banking sector is broadly classified into scheduled banks and non-scheduled
banks. The scheduled banks are those which are included under the 2nd Schedule off the
Reserve Bank of India Act, 1934. The scheduled banks are further classified into nationalized
banks; State Bank of India and its associates; Regional Rural Banks (RRBs); Foreign Banks;
and other Indian private sector banks. The term commercial banks refer to both scheduled
and non-scheduled commercial banks which are regulated under the Banking Regulation Act,
1949.

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Generally banking in India is fairly mature in terms of supply, product range and reach even
through reach in rural India and to the poor still remains a challenge. The government has
developed initiatives to address this through the State Bank of India expanding in branch
network and through the National bank of Agriculture and Rural development with facilities
like microfinance. Currently, India has 96 Scheduled Banks, 27 Public Sector Banks, 31
Private Banks and 38 Foreign Banks.

REFORMS IN THE BANKING SECTOR:

The first phase of financial reforms resulted in the nationalisation of 14 major banks in 1969
and resulted in a shift from class banking to mass banking. This in turn resulted in a
significant growth in the geographically coverage of banks. Every bank has to earmark a
minimum percentage of their loan portfolio to sectors identified as “Priority Sectors”. The
manufacturing sector also grew during the 1970s in protected environs and the banking sector
was a critical source. The next wave of reforms saw the nationalisation of 6 more commercial
banks in 1980. Since then the number scheduled commercial banks increased four-fold and
the number of banks branches increased eight-fold.

After the second phase of financial sector reforms and liberalization of the sector in the early
nineties, the Public Sector Banks (PSB) found it extremely difficult to complete with the new
private sector banks and the foreign banks. The new private sector banks first made their
appearance after the guidelines permitting them were issued in January 1993. Eight new
private sectors banks and presently in operation. These banks due to their late start have
access to state of the art technology, which in turn helps them to save manpower costs and
provide better services.

CLASSIFICATION OF BANKS:

The Indian Banking industry, which is governed by the Banking Regulation Act of India,
1949 can be broadly classified into two major categories, non-scheduled banks and scheduled
banks. Scheduled banks comprise commercial banks and the cooperative banks. In terms of
ownership, commercial banks can be further grouped into nationalised banks, the State Bank
of India and its group banks, regional rural banks, and private sector banks (the old / new
domestic and foreign). These banks have over 67,000 branches spread across the country.

12
The Indian banking industry is a mix of the public sector, private sector, and foreign banks.
The private sector banks are again spilt into old banks and new banks.

Banking System in India

Reserve Bank of India

Schedule Banks
Non-Schedule Banks

Central co-op
State co-op Commercial Banks Commercial Banks
Banks and Primary
Banks
Cr. Societies

Indian Foreign

Public Sector
Private Sector Banks HDFC, Axis, ICICI
Banks
ICICI etc.

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 State Bank of India Other Nationalized Banks Regional Rural
and its Subsidiaries Banks
About HDFC Bank

About HDFC Bank

HDFC (Housing Development Finance Corporation) is a financial and banking services

company headquartered in Mumbai, Maharashtra. It was amongst the first to receive and “in
principle” approval f om the Reserve Bank of India (RBI) to set up a bank in the private
sector, as part of RBI’s liberalization of the Indian Banking Industry in 1994. The Bank was
incorporated in August 1994 in the name of “HDFC Bank Limited”, with its registered office
in Mumbai, India. HDFC Bank Commenced operations as a Scheduled Commercial Bank in
January 1995. It is India's largest private sector bank by assets and world's 10th largest bank
by market capitalisation as of April 2021. It is the third largest company by market
capitalisation of $122.50 billion on the Indian stock exchanges. It is also the fifteenth largest
employer in India with nearly 120,000 employees. HDFC operates in 3,188 cities in India
with 6,342 branches and 18,130 ATM’s.

Acquisitions

Times Bank

In February 2000, Times Bank Limited (a new private sector bank promoted by Bennett,
Coleman & Co. / Times Group) merged with HDFC Bank Ltd. This was the first merger of
two private banks in the New Generation Private Sector Banks category.

Centurion Bank of Punjab

In 2008, Centurion Bank of Punjab (CBOP) was acquired by HDFC Bank Ltd. HDFC Bank
Board on 25 February 2008 approved the acquisition of CBOP for Rs 9,510 Crore in one of
the largest mergers in the financial sector in India.

Businesses

14
HDFC Bank caters to a wide range of banking services covering commercial and investment
banking on the wholesale side and transactional / branch banking on the retail side. The bank
has three key business segments:

Wholesale Banking

The Bank’s target market is primarily large, blue chip manufacturing companies in the Indian
corporate sector and to a lesser extent, small & mid-sized corporates, and Agro-based
businesses. For these customers, the Bank provides a wide range of commercial and
transactional banking services, including working capital finance, trade services, transactional
services, cash management, etc. The bank is also a leading provider of structured solutions,
which combine cash management services with vendor and distributor finance for facilitating
superior supply chain management for its corporate customers. Based on its superior product
delivery / service levels and strong customer orientation, the bank has made significant
inroads into the banking consortia of a number of leading Indian corporates including
multinationals, companies from the domestic business houses and prime public sector
companies. It is recognised as a leading provider of cash management and transactional
banking solutions to corporate customers, mutual fund, stock exchange members and banks.

Treasury

Within this business, the bank has three main product areas – Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the
Liberalisation of the financial markets in India, Corporates need more sophisticated risk
management information, advice, and product structures. These and fine pricing on various
treasury products are provided through the bank’s Treasury team. To comply with statutory
reserve requirements, the bank is required to hold 25% of its deposits in government
securities. The Treasury business is responsible for managing the returns and market risk on
this investment portfolio.

Retail Banking

The objective of the retail bank is to provide its target market customers a full range of
financial products and banking services, giving the customers a one-stop window for all
his/her banking requirements. The products are backed by world class service and delivered

15
to customers through the growing branch network, as well as through alternative delivery
channels like ATMs, Phone Banking, Net Banking and Mobile Banking.

The HDFC Bank preferred program for high-net-worth individuals, the HDFC Bank plus and
the investment advisory services programs have been designed keeping in mind need of
customers who seek distinct financial solutions, information and advice on various
investment avenues. The Bank also has a wide array of retail loan products including auto
loans, loans against marketable securities, personal loans, and loans for two wheelers. It is
also a leading provider of depository participant (DP) services for retail customers, providing
customers the facility to hold their investments in electronic form.

HDFC Bank was the first bank in India to launch an International Debit Card in association
with VISA (VISA Electron) and issues the MasterCard Maestro debit card as well. The bank
launched its credit card business in late 2001. By March 2015, the bank had a total card base
(debit and credit cards) of over 25 million. The Bank is also one of the leading players in the
“merchant acquiring” business with over 235,000 point of sale (POS) terminals for debit /
credit cards acceptance at merchant establishments. The bank is well positioned as a leader in
various net based B2C opportunities including a wide range of internet baking services for
fixed deposits, loans, bill payments, etc.

Subsidiaries

HDFC Financial Services Limited (HDBFS) is engaged in retail asset financing. It is a non-
deposit taking non-bank finance company (NBFC). Apart from leading to individuals, the
company grants loans to micro, small and medium business enterprises. It also runs call
centres for collection services to the HDFC Bank’s retail loan products.

HDFC Securities Limited (HSL) is engaged in stock broking. As of March 31, 2014,
HDBFS has 200 branches across 160 cities. HDFC Bank has 89.24% shareholding in HSL.

The equity shares of HDFC Bank are listed on Bombay Stock Exchange and the National
Stock Exchange of India. Its American Depository Shares are listed on NYSE and the Global
Depository Receipts are listed on the Luxembourg Stock Exchange where two GDRs
represent on equity share of HDFC Bank.

16
Technology

HDFC Bank operates in a highly automated environment in terms of information technology

and communication systems. All the Bank’s branches have online connectivity, which
enables the bank to offer speedy funds transfer facilities to its customers. Multi branch access
is also provided to retail customers through the branch network and Automated Teller
Machines (ATMs). The bank has made substantial efforts and investments in acquiring the
best technology available internationally, to build the infrastructure for a world class bank. In
terms of core banking software, the corporate banking business is supported by Flex cube,
while the retail banking business by Finware, both from I-flex solution Ltd. The systems are
open, scalable and web enabled.

The bank has prioritised its engagement in technology and the internet as one of its key goals
and has already made significant progress in web enabling its core businesses. In each of its
businesses, the bank has succeeded in leveraging its market position, expertise, and
technology to create a competitive advantage and build market share.

Mission and Business Strategies

Our mission is to be “a World Class Indian Bank”, benchmarking ourselves against

international standards and best practices in terms of product offering, technology, service
levels, risk management and audit & compliance. The objective is to build sound customers
franchises across distinct businesses so as to be a preferred provider of banking services for
target retail and wholesale customer segments, and to achieve a healthy growth in
profitability, consistent with the Bank’s risk appetite. We are committed to do this while
ensuring the highest levels of ethical standards, professional integrity, corporate governance,
and regulatory compliance.

Our business strategy emphasizes the following:

17
  Increase our market share in India’s expanding banking and financial services
industry by following a disciplined growth strategy focusing on quality and not on
quantity and delivering high quality customer service.
 Leverage our technology platform and open scalable systems to deliver more products
to more customers and to control operating costs.
 Maintain our current high standards for asset quality through disciplined credit risk
management.
 Develop innovative products and services that attract our targeted customers and
address inefficiencies in the Indian financial sector.
 Continue to develop products and services that reduce our cost of funds.
 Focus on high earnings growth with low volatility.

Awards and Recognition

2020 - 2021

 HDFC Bank adjudged 'Best Private Bank in India' at the Global Private Banking
Awards 2021
 HDFC Bank adjudged Best for wealth transfer - succession planning in India 2021 by
Asiamoney Asia Private Banking Awards 2021
 HDFC Bank named ‘Best Bank in India’ at Euromoney Awards 2021
 HDFC Bank ranks No. 1 in Mass Affluent category at Euromoney Private Banking
and Wealth Management Survey 2021
 HDFC Bank has been adjudged ‘India’s Best Bank’ by Euromoney Awards for
Excellence 2020.
 HDFC Bank named India’s Best Domestic Bank by Asiamoney

2018 – 2019

 HDFC Bank has been adjudged Private Sector Bank of the Year at the 18th Outlook
Money Awards 2019.
 HDFC Bank has been adjudged ‘India’s Best Bank’ by Euromoney Awards for
Excellence 2019.

18
 HDFC Bank has been featured in the latest edition of BrandZ Top 100 Most Valuable
Global Brands 2019 for the 5th consecutive year
 HDFC Bank has been adjudged ‘Best Private Bank in India’ at The Banker Global
Private Banking Awards 2018.
 HDFC Bank has been ranked no. 1 bank in India in the Forbes’ World’s Best Banks
report
 HDFC Bank ranks No. 1 in Asset Management category at Euromoney Private
Banking and Wealth Management Survey 2019
 Euromoney Survey 2018 - Best Private Banking services for Super Affluent Clients
 Best Bank for Financial Inclusion - UTI Mutual fund CNBC TV 18 Financial
Advisory Awards 2017
 UTI MF & CNBC- TV18 Financial Advisory Awards - Best Performing Bank –
Private 2018-19
*Our Bank has won this honour 7 times in the past 10 years since the inception of this
award in 2009.
 Euromoney Trade Finance Survey 2019 - Best Service (Asian Banks only) – India
& Market Leader (Asian Banks only) - India
 The Banker - Bank of the year TB 2018 - The Banker - Bank of the year award -
Best Private Bank in India 2018
 Euromoney Private Banking and Wealth Management Survey 2018* - Ranked
No. 1 in Super Affluent Clients (US$ 1 million to US$ 5 million) *
 HDFC Bank has been awarded by Euromoney 10 times in the last 11 years.

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INTEGRATED FINANCIAL SERVICES

SECURITISATION

HDFC CHUBB GENERAL

INSURANCE CO. LTD.

Future Activities

DISTRIBUTION

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Job Description: Relationship Manager

Overall Goal:

is responsible for

 Acquisition of new Preferred customers.

 Enhancement of the relationship by cross selling products and services as per the
profit & need of the customers.
 Deepening the size of the relationship.
 Retention of the customers by providing the best possible services and being the
dedicated point of contact for these customers.
 HDFC Bank is the primary banker for these preferred relationships.
 Maximum share of wallet of these customers is with HDFC Bank.

Key Result / Responsibility Areas:

Sales: (Acquiring, Enhancing, Deepening and Retention)

 Acquire new customers who meet product criteria and flag them on the system.
o Referrals generated from existing customers.
o Leads generated by branch staff & personal leads.
o Databases.
o Premier Acquisition Channel.
 Increase liabilities size of relationship via:
o Balances in a/c’s of existing customer.
o Acquire all related of the primary id and send racing request on web-based
system/entry form to CPU for flagging and grouping.
o Use FD maturity reports to track maturity of HDFC FDs and prevent outflow.
o Use wallet profile to track FDs in other banks and divert them into HDFC on
maturity.
o Use wallet profile sheet to track accounts and products with another bank and
transfer the same.
o Know the customer’s business to proactively provide financial solutions.

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 Utilizing the sales resources (BDR or COEX or Asset Coordinator) for optimal sales
support.
 Penetration of products across family groups.
 Sales across all product segments – TPP, Assets, Cards etc.
 Identify existing / new customers who meet preferred criteria and flag them on the
system and upgrade these customers under the preferred programme in line with
preferred grouping criteria.
o Liaising with PB to flag eligible customers from classic portfolio.
o Identifying customers through large transaction reports (LTR).
o GMs or VPs of all Cat A companies and CSRM salary account companies
which meet programme criteria and have future potential.
 Ensure that individual customers are grouped and Customers to Group (CTG) Ratio
is maintained on the portfolio.
o By grouping them with their family members who already hold accounts with
us.
o By grouping them with their family members post selling liability products to
the family members if they do not have banking relationship with us.
 Ensure that optimal levels of Income generating Product Group Holding (IPGH) is
reached
o Ensure that within each customer group a minimum number of stipulated
incomes generating products are sold.
 Ensure that the customer group profitability is achieved
o Manage band 1 and 2 customers and ensure that they are moved to band 3 and
above
 Ensure that at least one income product is sold to each preferred group in the year.
 Regular contact is maintained with all portfolio customers such that 12.5 customers
are connected every month and entire portfolio is contacted at least once every
quarter.
 Customer interactions are duly updated on CCM/CRM Next
 Profile changes (if any) are duly updated in CRA/CRM Next
 Enhancing customer wallet size
o Ensuring that customers make us their primary bank

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  Knowing about where all the customers is currently banking and
moving him to our bank.
 Ensuring that customer scope is done, and products targeted
accordingly
 Sales to family members and associates which have been grouped
together.
 Attrition control of customers
o Includes persuading the customer to continue and if required renew FD’s
o Deepen by cross selling ‘sticky products’ like Demat, Bill Pay, Advisory.
o Ensure quality of relationship while racing. Should be capable of maintaining
eligibility.
o Regular customers contact to establish needs of the customers and
opportunities to cross sell.
o Monitor large amount movements and account closure from the deposit
accounts and ensure that customers do not attrite.
o Ensure that the marketing analytics list on possible attrite is called and
retained.

Customer Services

 Ensure quality customer service is delivered.

 Disseminating required product information.
 Recording complaints as per the specified process.
 Resolving all complaints received from preferred customers within the stipulated
TAT’s
o Ensure appropriate customers communication on closure & copy of that to be
filed.
 Preventive complaint management
o Asking for feedback from customers, who may not be complaining.
 Promoting all direct banking channels and ensuring that the customer is utilizing the
same.
o Check back on recent customer’s registered to DBC channel and give any
specific help required.

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Achievement of income plans and other benchmarks

 Ensure that income plans for the month and year are duly met across products.
 Achieving of portfolio level benchmarks of CTG (70% of the groups to have >=3
customers) and IPH (80% of the groups to hold >=5 income products)
 Atleast 1 income product to be sold to each group of the portfolio in the year.
 Ensure that the benchmark of 4 sales per day is met.

Operations

 Ensure certification of documentation required for opening and maintaining customer

accounts.
 Error free documentation for all account opening and all customer instruction (Stop
payments, FD closure, etc)
 Ensure that 5-S norms are adhered to for individual’s workstation.

Supervision Received:

Branch Manager, Head Relationship Manager, Relationship Manager

Competencies:

 Sales and influencing Skills.

 Banking Product & Process Knowledge.
 Planning and organizing Skills.
 Communications Skills.
 Knowledge of competition & current trends in financial industry.

Certification:

 AMFI Certification

24
  NCFM Certification (optional)
 CAIIB (optional)
 Internal Certification

Performance Linked Pay (PLP)

HNW (Imperia RM, Preferred RM and Classic PB)

FY 2022 – 2023

The performance linked pay for Imperia & Preferred Relationship Managers and Classic
Personal Bankers have been formulated ensuring that the same is consistent and aligned to
the common Performance Linked Pay (PLP) Principles of the bank.

Objective:

The objective of the PLP is to drive consistent behaviour towards management objectives of
customers engagements, service and business growth.

Eligibility:

 This PLP Scheme is applicable to all branch banking Preferred Relationship

Managers (RM), Imperia Relationship Managers (ICRM) & Classic Personal Bankers
(PBs) having a designated scorecard from 1st April’2022 onwards.
 A person who has resigned from the services of the bank at the time of the payout
shall not be eligible for any PLP related to present or previous months or holdback
payment if any.
 The PLP is applicable for all staff and shall be paid quarterly.
 Only AMFI and IRDA complaint staff shall be eligible for payout of PLP. For non
complaint staff on either certification, the PLP will be held back and payout shall be
done only on completion of the certification within the FY.

25
Balanced Score Card:

The Performance linked pay (PLP) is an important initiative to drive productivity. The
Performance linked pay (PLP) is designed based on balanced scorecard, which takes a
number of qualitative and quantitative factors into qualitative factors are duly moderated by
qualitative parameters. The quantitative / qualitative factors considered in the balanced
scorecard are as under:

 Performance against set productivity

 Qualitative Parameters / factors to ensure sourcing of quality accounts

The performance score is measured basis weightage points applied for each of the parts,
parameters within each part and multiplied with customer engagement process (CEP) score.

Common Gate Criteria applicable for overall PLP – Part A, B, C, D & E – All 3
conditions to be met for each part.

a) Min achievement of 75% of YTD Income plan

b) Min achievement of 70% of YTD Liability Incremental value
c) Minimum converted asset unit – 5 Units per month (not numbers) for Imperia,
Preferred and classic basis LG. YTD target to be met. Units credit as per the grid in
Part C.

Scorecard Construct:

This PLP scheme is based on a Balanced Scorecard for ICRM, RM and PB which includes 5
Parts: Part A - Income, Part B - CASA &Liability Value, Part C - Retail Assets and Total
Assets, Part D - Customer Engagement, Productivity & Portfolio Quality and Part E - NAV
and RAV Multiplier.

The PLP shall be based on a "Composite Scorecard" derived from weightage assigned to
various productivity and quality parameters; For Part A, B,C & E, points shall be calculated
every quarter, basis the YTD performance of the resource; For Part D, points shall be
calculated every quarter basis QTD performance of the resource.

26
Payout shall be processed quarterly for Part A, B, C, D and E.

Part Scorecard / PLP weightage Minimum eligibility for PLP

Part A(Income) 35% 75% YTD Ach
Part B (CASA &Liability) 25% 75% YTD Ach
Part C (Retail Assets and 17.5% 75% YTD Ach
Total Assets)
Part D (Customer 22.5% Composite Score (QTD)
Engagement >=65%
Part E - NAV and RAV 110% YD Achievement in
Multiplier BOTH
- NAV and RAV Parameters

Part A constitutes Revenue plan for each resource. Every resource is assigned benchmark as
core deliverable.

Part B constitutes CASA &Liability plan for each resource. Every resource is assigned
benchmark as deliverable.

Part C constitutes Retail Assets and Total Assets Plan for each resource. Every resource is
assigned benchmark as deliverable.

Part D comprises of parameters related to Customer Engagement, Productivity and Portfolio

quality

Part E comprises of NAV and RAV Multiplier

Part D: If Gate Conditions are not met, PP Payout for Part D will be held back. Part D PLP
earned but held back shall be released in the quarter when the YD Gate Entry Conditions get
Met.

YTD CEP will be used for the same.

27
 Part A – Total income plan – 35% weightage – YTD Performance

Part A Parameters Details / Norms Weightage Targets Measure

1 Total Income Income based spread – Portfolio Imperia & preferred:
- YTD liability, assets, TPP, Forex 35% Level Plans income classic income: %
& other Products income achievement

Part B – CASA & Liability Plan – 25% weightage – YTD Performance

Part B Parameters Details / Norms Weightage Targets Measure

1 Liability Inc. Incremental growth against 25% Portfolio Point basis % Ach on plan
Val – (AMB) plan in CA, SA, SAL Level Plans
Portfolio (AMB) and TD (AMB)
2 CASA Inc. Incremental growth against 22.50% Portfolio Point basis % Ach on plan
Val (AMB) plan in CASA Level Plans
Portfolio
3 TD Value Incremental growth plan 17.50% Portfolio Point basis % Ach on plan
(AMB) Level Plans
Portfolio
4 CIB (AMB Incremental growth plan 17.50% Portfolio Point basis % Ach on plan
on 31st Level Plans
March’22 basis CIB
Portfolio growth
group) budget
5 New NAV Plans for CASA (New 17.50% Imperia – 65 Point basis % Ach on plan
acquisition Customer ids) Lacs p.a
value (AYB) Preferred –
– Portfolio + 55 Lacs p.a
Non Classic – 45
Portfolio Lacs p.a

28
 TOTAL 100%

Part C – Retail Assets and Total Assets – 17.50% weightage – YTD Performance

Part C Parameters Details / Norms Weightage Targets Measure

Retail asset value for the following
products:
Personal loan + Personal loan OD,
business loan + business loan OD, Auto
loan – New Car and used car, two wheeler
Quarterly Retail No Points <75% ach,
loan, home loan, gold loan, loan against
1 Retail asset Assets – Annual pro-rata calculation, max
securities, loan against property, consumer
value (RAV) 50% disbursement capped at 200%
durable loan, loan against credit card,
value targets (in
education loan
crores)
Disbursement Value capping per asset case
in this section will be 2.50 crores
Conversion basis LG units (only for loan
against credit card units credit will be
given basis LC) (inside + outside portfolio)
(BBWC, EEG, LAP, CBG, ECG, IFG,
HCF, other wholesale asset = 1 unit)
Retail Asset units credit basis disbursement
value of retail asset (including CV):
8 units per
>=25K = 0.25 units credit
month including No points < 50%, pro
>25K to 50K = 0.50 units credit
2 Total asset units 20% AL, PL, BL, rata calculation, max
>50K to 10 Lac = 1 unit credit
Home Loan, capped at 200%
>10 Lac to 50 Lac = 1.25 units credit
Gold Loan and
>50 Lacs = 1.50 units credit
LAP
LAS & HL
>1 Lakh = NIL unit credit
1 Lakh to <3 Lakh = 0.33 units credit
> = 3 Lakh to < 5 Lakh = 0.67 units credit
> = 5 Lakh to < 50 Lakh = 1 unit
> = 50 Lakh = 1.25 unit

Overall conversions (inside + outside

portfolio)

29
 < = 25K = 0.25 units credit
3 Auto Loan > 25K to 50K = 0.50 units credit 10% IPC – 1 unit per No Points < 50%, pro
> 50K to 10 Lac = 1 unit credit month rata calculation, max
> 10Lac to 50 Lac = 1.25 unit credit capped at 200%
>50 lac = 1.50 units credit
Overall conversion (inside + outside
portfolio)

4 Personal Loan / < = 25K = 0.25 units credit 10% IPC – 1 unit per No Points < 50%, pro
Business Loan > 25K to 50K = 0.50 units credit month rata calculation, max
> 50K to 10 Lac = 1 unit credit capped at 200%
> 10Lac to 50 Lac = 1.25 unit credit
>50 lac = 1.50 units credit
Overall conversions (inside + outside
portfolio)
LAP: 1 unit
Gold Loan:
< = 25K = 0.25 units credit
> 25K to 50K = 0.50 units credit
> 50K to 10 Lac = 1 unit credit
5 Home Loan / 10% IPC – 2 unit per No Points < 50%, pro
> 10Lac to 50 Lac = 1.25 unit credit
LAP / Gold quarter rata calculation, max
>50 lac = 1.50 units credit
Loan capped at 200%
Home Loan
>1 Lakh = NIL unit credit
1 Lakh to <3 Lakh = 0.33 units credit
> = 3 Lakh to < 5 Lakh = 0.67 units credit
> = 5 Lakh to < 50 Lakh = 1 unit
> = 50 Lakh = 1.25 unit
Total 100%

30
 Part D – Customer engagement, productivity and portfolio quality parameters –
22.50% weightage - quarterly

Part D Parameter Details / Norms Weightage Targets Measures

Managed Racing by 9 day of M2 and credit to be
th
10% IPC – 1 per month, (Program No points below
program NTB given in 1st full month when program eligibility norms to be met and <50%, pro rata
1
sourcing criterion is met within M6. (only LG = LC) only LG = LC) calculation No
max cap
1 SB max = 1.25 units (LG = LC) and 0.50
units where only LG or only LC
1 MAMC (excl. special savings account)
with 5 lacs EOP of M1 = 1.50 units (LG =
LC) and 0.50 units where only LG or only
LC
M2 AMB > 1 lacs, bonus 0.25 unit, M2
SB Net units –
AMB > 3 Lacs, Bonus 0.50 unit
Net units Imperia – 7 unit p. m. preferred No points below
1 SB Speciale gold account = 1.50 unit
2 calculated by 10% – 9 units p.m. classic 11 units <50%, pro rata
(LG = LC) and 0.50 units where only LG
deducting the p.m. (salary account units calculation, max
or only LC
M2 depleted considered only for classic PB) capped at 200%
1 SB speciale platinum account = 1.75
saving accounts
units (LG =LC) and 0.50 units where only
LG or only LC
1 super kids savings account = 1.50 units
(LG = LC) and 0.50 units where only LG
or only LC
3 CA net units – Units to be measured LG = LC (self 10% 6 units per quarter for imperia & No points below
net units sourcing) preferred 4 units per quarter for <50%, pro rata
calculated by 1 max advantage – 2.50 units classic PB calculation,
deducting the 1 ascent and above and TASC accounts – 2 Max capped at
M2 inactive units 300%
current 1 below ascent variant – 1 unit
accounts.
4 Unique FDRD Unique FD / RD units – unique customer 5% Imperia preferred and classic – No points <
units (inside id units: (inside portfolio) 3 units per month 50%, pro rata
portfolio) Minimum tenure >=1 year calculation, max
(100% units credit if LG = LC) and capped at 200%

31
 (50% units credit if only LG or only LC)
Unique FD (units credit grid basis the
unique FD amount)
< = 25K = 0.25 units
> 25K to < 1 Lakh = 0.50 units
1 Lakh to < 2 lakh = 0.75 units
2 lakh to < 10 lakh = 1 units
10 lakh to < 1 crore = 1.50 units
> = 1 crore = 2 units

Unique RD (Units credit grid basis the

unique RD amount)
<4K = 0.25 units
4K to < 8K = 0.50 units
8K to < 16K = 0.75 units
16K to < 1lakh = 1 units
1lakh to < 8lakh = 1.50 units
> = 8 Lakh = 2 units
5 Unique FDRD Unique FD / RD units – unique customer 7.50% Imperia preferred and classic – No points <
units (inside + id units: (inside portfolio) 12 units per month 50%, pro rata
portfolio) Minimum tenure >=1 year calculation, max
(100% units credit if LG = LC) and capped at 200%
(50% units credit if only LG or only LC)
Unique FD (units credit grid basis the
unique FD amount)
< = 25K = 0.25 units
> 25K to < 1 Lakh = 0.50 units
1 Lakh to < 2 lakh = 0.75 units
2 lakh to < 10 lakh = 1 units
10 lakh to < 1 crore = 1.50 units
> = 1 crore = 2 units

Unique RD (Units credit grid basis the

unique RD amount)
<4K = 0.25 units
4K to < 8K = 0.50 units
8K to < 16K = 0.75 units
16K to < 1lakh = 1 units
1lakh to < 8lakh = 1.50 units
> = 8 Lakh = 2 units
6 RTFX (excl. Imperia and preferred: UTC of trade 10% Imperia and preferred – 2 units No points <

32
 Forex card) customers only per quarter 50%, pro rata
calculation, ma
Classic: Retail forex and UTC of trade Classic – 2 units per quarter capped at 200%
customers
7 NBA contract NBA interaction updation in CRM next. 5% 100% updation of NBA < 80% - NIL
(including points
service NBA) – Staff to not use service interaction on CRM >= 80% to <
Analytics based and only use RA to ETB customers 85% - 35%
customers Points
engagement ›= 85% to <
88% - 50%
Points
≥= 88% to <
90% - 75%
Points
>= 90% to
<95% - 85%
points
>= 95% - 100%
- 100% points
8 Demat / HSL – M3 Active - Demat & HSL only (Basis 5% Imperia and preferred 6 units No points <
active LG) per quarter 50%, pro rata
(50% Units Credit on sourcing and 50% on calculation, max
activation) Classic 4 units per quarter capped at 200%
1 Active Demat Account = 1 Unit
I Activè HSL Account = 1 Unit
Outside Portfolio Credit will be considered
post completion of Inside Portfolio Targets
(Activation Criteria - 1 Transaction to
happen by M3. M1 being the Month of
Account Opening)
9 Credit card Conversion basis LG 5% Imperia and preferred and No points <
(T+3) active – 1 Prime / 1 Corporate Card / 1 Forex Plus classic - 2 units per month 50%, pro rata
prime & Card = 1 Unit (inside portfolio) calculation, max
upgrades & 1 Upgrade = 0.5 Unit capped at 300%
corporate cards Forex Card with Loading (Unique
and forex plus Custómer)
card Outside Portfolio Credit will be considered
post completion of Inside Portfolio Targets
10 RE – KYC High, medium , low 5% Monthly target to be achieved No points <
2.5% for high 2.5% for medium 50%, pro rata

33
 and low calculation, max
capped at 100%
11 Life Insurance Only fresh cases (excluding renewals) 7.5% Monthly target as per branch No points <
category 50%, pro rata
calculation, max
capped at 200%
12 SAHI and Fungible between SAHI and general 5% Monthly target as per branch No points <
general insurance (fresh and renewals cases will be category 50%, pro rata
insurance considered) calculation, max
capped at 200%
13 MF values Inside portfolio – only 5% Monthly MF target – total – No points <
(includes offline Outside portfolio credit will be considered total of offline / ISA / investnow 50%, pro rata
, physical, ISA post completion of inside portfolio targets lumsum (+) SIP – portfolio level calculation, max
and investnow) target capped at 200%
14 SIP units Inside portfolio – only 5% Monthly SIP units target – total No points <
(includes Outside portfolio credit will be considered of offline / ISA / investnow 50%, pro rata
physical, ISA post completion of inside portfolio targets lumsum (+) SIP – portfolio level calculation, max
and investnow) target capped at 200%
15 Digital Unique groups activation (Bill pay / NB / 5% As per portfolio No points <
MB/ Payzapp) 50%, pro rata
calculation, max
capped at 200%
TOTAL 100%

Weightage and product level targets are subject to change during the financial year, which
would be communicated to channel as and when changes are done. While calculating PLP the
latest score card target and weightage are to be used.

34
 Part E – NAV and RAV multiplier (Max. annual points capping – 200 points)

Qualifying conditions for NAV and RAV multiplier section – min. 110% YTD Ach in
both NAV as well as RAV parameters

Part E Parameters Details / Norms Targets Computation

1 NAV and RAV YTD NAV and RAV As per defined NAV & RAV achievement multiplier
Multiplier targets – both to be NAV and score = % achievement against YTD
met (minimum RAV targets plan in NAV * % achievement against
achievement for both YTD in RAV (A*B)
the parameters to be >
= 110%) NAV section (A) = % achievement
against NAV plan
<110% YTD achievement – NIL points
>=110% YTD achievement – actual
achievement

RAV section (B) = % achievement

against RAV plan
<110% YTD achievement – NIL points
>=110% YTD achievement – actual
achievement

NAV and RAV Quarterly points (Max Annual points (Max

achievement multiplier capping) capping)
score
> = 120% to < 130% 20 80
> = 130% to < 140% 30 120
> = 140% to < 150% 40 160

35
 > = 150% 50 200

Performance Linked Pay Structure

Part A – total income plan – 35% weightage – YTD performance

Imperia, preferred, Classic Point calculation grid: 1 lac income is equivalent to 1 point. Points have a
Eligibility multiplier fixed as per below grid.
1. Meeting common gate criteria Progressive grid Performance Month YTD points for
2. 75% of YTD income plan – average Multiplier (PM) Multiplier part A
Income achievement – outside portfolio income shall income as per
be restricted to 30% of the overall applicable income. month (PA)
Applicable income is capped at (inside income / 0.7) <=5 points 1.75 Y PA * PM * Y
>5 to <=7.5 1.85 Y PA * PM * Y
Point achievement max capped at 93.33 points for points
imperia and 67.08 points for preferred (Monthly) >7.5 to <=10 2.00 Y PA * PM * Y
Month multiplier to be included in capping. points
Month multiplier refers to the number of months the >10 to <=15 2.20 Y PA * PM * Y
RM has income plan in current FY. points
>15 to <=20 2.40 Y PA * PM * Y
Classic PB points
Eligibility >20 to <=25 2.60 Y PA * PM * Y
1. Meeting common gate criteria points
2. 75% of YTD income plan >25 to <=40 2.80 Y PA * PM * Y
Income achievement - Outside portfolio income shall points
be restricted to 50% of the overall Applicable income. > 40 points 3.0 Y PA * PM * Y
Applicable income is capped at (Inside income/0.5)

Classic PB:
Point Achievement Max Capped at 16.04 Progressive grid Performance Month YTD points for
Points for Classic PB (Monthly) – average Multiplier (PM) Multiplier part A
income as per
Month Multiplier to be included in capping month (PA)
<= 1.5 points 1.75 Y PA * PM * Y
* Month Multiplier refers to the Number of Months > 1.5 to 3 points 1.80 Y PA * PM * Y
the PB has Income Plan in Current FY > 3 to <= 5 1.90 Y PA * PM * Y
points
> 5 to <= 7.5 2.00 Y PA * PM * Y

36
(Min. 75% Achievement of YTD Income) points
> 7.5 points 2.20 Y PA * PM * Y
Average Progressive grid ach = Total YTD points divided by number of months
portfolio is manned.
YTD points (A) shall be avg. P. M. Progressive grid ach (PA)* Performance
multiplier (PM)* month multiplier.
Final points for Part A: (A – A’) YTD CEP avg. Score
Wherein A’ is the YTD points paid out till previous quarter

Part B – CASA & Liability Plan – 25% weightage – YTD Performance

Imperia, preferred & classic Point calculation grid:

eligibility Points earned will be basis % achievement of target
Meeting common gate criteria Points have a multiplier fixed as per below grid
Min 75% ach for part B Base multiplier (BM): imperia – 22.22, preferred – 15.97, classic – 3.81
% ach of YTD Performance multiplier Base Vintage YTD points
% achievement max capped at target (PA) (PM) Multiplie Multiplier for part B
300% r (BM)
75% to <90% 0.50 BM Y PM*BM*Y
Max points per month 90% to <100% 0.70 BM Y PM*BM*Y
Imperia: 66.66 points 100% 1 BM Y PM*BM*Y
Preferred: 47.91 points >100% Prorata points = % ach / BM Y PM*BM*Y
Classic: 11.45 points 100

Vintage multiplier to be included Performance multiplier (PM) is decided basis percentage achievement bucketing
in capping. YTD points for part B shall be performance multiplier (PM) * base multiplier (BM)* Vintage
multiplier

Final points for part B: (B – B’) * YTD CEP avg. Score

Wherein B’ is the YTD points paid out till previous quarter

37
 Part C – Retail Assets and Total Assets – 17.50% weightage – YTD performance

Imperia, preferred & Classic eligibility Point Calculation Grid.’

Points earned will be basis % achievement of target
Meeting common gate criteria Points have a multiplier fixed as per below grid
Minimum 75% Ach of Part C
% Achievement Max Capped at 200% Base Multiplier (BM)' Imperia -23.33, Preferred - 16.77, Classic -4.01
% ach of QTD Performance Base Vintage QTD points
Max points per month target (PA) Multiplier (PM) Multiplier Multiplier for Part C
Imperia: 46.66 (BM)
Preferred: 33.54 75% to <90% 0.50 BM Y PM*BM*Y
Classic: 8.02 90% to <100% 0.70 BM Y PM*BM*Y
Vintage Multiplier to be included in capping 100% 1 BM Y PM*BM*Y
>100% Prorata points = BM Y PM*BM*Y
% ach / 100

Performance Multiplier (PM) is decided basis percentage achievement bucketing

YTD Points for Part C shall be Performance Multiplier (PM) * Base Multiplier {BM)”
Vintage Multiplier

Final Points for Part C: (C - C’) * YTD CEP Avg. Score

Wherein C’ is the YTD points paid-out till previous Quarter

38
 Part D- Customer Engagement, Productivity and portfolio quality – 22.50% weightage
– quarterly performance

Imperia, Preferred & Classic Eligibility Point Calculation Grid:

Points earned will be basis % achievement of target Points have a multiplier fixed
Meeting Common Gate criteria as per below grid
Min. Composite Score for the Part D Section - 65%
Base Multiplier (BM): Imperia - 30, Preferred - 21.56, Classic – 5.15
% Achievement Max Capped at 200% Composite % Performance Base Vintage Final points
Ach of Part D Multiplier Multiplier Multiplier for part D

Max points per month (PA) (PM) (BM)

Imperia: 60 points
Preferred: 43.12 points 65% to <70% 0.20 BM Y PM*BM*Y
Classic: 10.31 points 70% to <90% 0.50 BM Y PM*BM*Y
90% to 0.70 BM Y PM*BM*Y
Vintage multiplier to be included in capping. <100%
100% 1 BM Y PM*BM*Y
>100% Prorate points BM Y PM*BM*Y
= % ach / 100

Points shall be calculated based on QTD performance across parameters

Performance multiplier (PM) is decided basis percentage achievement bucketing
Final points (D) of every quarter shall be calculated as follows:
Performance multiplier (PM) * Base Multiplier (BM)* vintage multiplier for the
quarter * QTD avg CEP score
Deferred payout: Part D composite score qualified but gate entry not cleared – the
payout will be deferred. The deferred payout will be made as and when 3 gate
conditions are met on YTD basis. YTD conditions will be checked at the end of
each quarter.

39
Part E- NAV and RAV Multiplier Grid - Quarterly Performance

NAV and RAV Achievement Multiplier Score

% Achievement against YTD plan in NAV* % Achievement against YTD in RAV

NAV Section = % Achievement against NAV Plan

< 110% YTD Achievement - NIL points

>=110% YTD Achievement - Actual Achievement

RAV section = % achievement against RAV plan

<110% YTD achievement – NIL points

>=110% YTD achievement – actual achievement

NAV and RAV Achievement, Multiplier Quarterly Points (Max Annual Points (Max
Score Capping) Capping)

> = 120% t'o < 130% 20 80

> =130% to < 140% 30 120

> = 140% to < 150% 40 160

> = 150% 50 200

Imperia. Preferred & Classic Eligibility

1. Meeting the Common PLP Gate Criteria

2. Minimum 110% YTO Achievement in NAV and RAV Parameters- Both the Targets to be Met

Point Calculation Grid:

Points earned will be basis achievement of target

40
Final Points (E) for the section to be computed as per the payout grid above

Deterrents for Section E

Meeting the Common PLP Gate Entry Criteria

Minimum 110% YTO Achievement in NAV and RAV Targets - Both the Targets to be Met by Staff to Qualify
for the NAV and RAV Multiplier.

Total Payout Points for PLP calculation will be done as: [Part A final points (A)+ Part B Final Points (8)
t .
+ Part C Final Points (C) + Part D Final Points (D) + Part E Final Points (E)

PLP =Total Payout points* Rs 1000/- per point

Hold Back:

 Hold back of Payout: 20% PLP qualified every quarter will be retained and paid out at the
end of the financial year. This shall be applicable to all resources who continue to be with the
Bank (In the same role or any other role within the Bank). Resigned employees shall not be
eligible for any PLP related to any month or any holdback payment. Employee will be
eligible to receive the Holdback amount at the end of the financial year subject to 100%
annual income plan, 75% of Section B & 100% of Asset unit gate entry.
 Part C: Part C payout is to be done quarterly. The amount shall be held back in case the
common gate conditions are not met and released at the end of the quarter once common gate
criteria is met.
 Part D: Part D payout is to be done quarterly. The amount shall be held back in case the
common gate conditions are not met and released at the end of the quarter once common gate
criteria is met.
 AMFI & IRDA Compliance: Only AMFI and IRDA Compliant staff shall be eligible for
payout of PLP. For non-complaint staff on either certification, the PLP will be held back and
payout shall be done only on completion of the certification within the FY.

Maximum Capping:

Maximum PP Capping; The maximum payout will be capped for Imperia ICRMs at Rs.34 Lacs per
annum, for Preferred RM at Rs.25 Lacs per annum & for Classic PBs at Rs.7.50 Lacs per annum for
each Profile respectively. Capping has been incorporated in the PLP structure against each Part to
ensure that PLP is based on the balanced scorecard.

41
 Deterrents:

Parameters Parameter wise deterrent & quality check

PLP common gate entry Staff Qualifies for PP only on meeting the common Gate Entry Criteria for all the
sections of the PP to have balanced performance
New acquisition value (NAV) NAV credit is given only for New Customer IDs, value credit is not given for opening
more accounts of Existing customers.
Granular approach Business credit of Large Government & Corporate accounts is removed from the RM
scorecard so that the focus remains on Service to Retail Customers.
SB net units credit There is deduction of accounts Not maintaining balance in M2 from the sourcing credit
to staff. This ensures proper Onboarding of New customers and quality control.
CA net units credit There is deduction of accounts Not maintaining balance in M2 from the sourcing credit
to staff. This ensures proper Onboarding of New customers and quality control.
Program NTB units credit New HW Customer sourcing credit is given only if Customers are raced to portfolio
and customers maintain balance as per Imperia, Preferred and Classic Programme
Unique FDRD units credit All FDRD are not given same credit. FDRD with lower value is given lower credit.
PLP credit is given only for FD booked for greater than 1 year tenure. Best rates for
customers is above 1 year period.
RTFX Only Unique Trade Customer (inactive in 12 months or new) are considered (+) RFX
Transactions (For Classic PB Only) are given credit.
Demat / HSL units credit Only 50% Units Credit on Inactive Demat / HSL Accounts
Credit card units credit 0% Units Credit on Inactive Credit card.
Asset units credit RMs are given credit for assets basis the effort. Lower ticket OTC assets like Loan on
Credit Card, Consumer durables are given lower credit for disbursement basis Value of
the asset disbursed
Retail assets value (RAV) Capping on Disbursement value for asset cases in RAV section.
Income capping per asset case Capping on Income from Large ticker Asset disbursements for PP Pay-out
Minimum performance benchmark & maximum For a balanced performance and Customer Need based Selling only, the score for any
capping in most parameters parameter is computed basis minimum and maximum limits for most parameters
NIL PLP is paid out below minimum threshold NIL PLP is paid out below minimum threshold of achievement
of achievement
Customer engagement policy (CEP) CEP Benchmark: The shortfall in CEP benchmark will be a major deterrent. Final
points in each section will be moderated by Non-Achievement of CEP Benchmark by
the resource. Points earned in each section of the Scorecard will be multiplied with

42
 YTD CEP % achievement for Part A, B and C and with QTD CEP % Ach for Part D to
arrive at the Final points of each section.

Consequences Management Grid – CMG

Nature of complaint /
Staff attributable Measure (Staff attributable complaint) CMG Actionable – All Bank Staff
complaint
1st SAC due to staff knowledge (staff Department caution memo
vintage > 4 months in department /  Department caution memo
vertical) (sans rating impact)
a. 1st SAC – behavior led & act of  Rs. 5000/- or 5% deduction
omission or any act of wrong doing (*) for the quarter PLP or
Staff attributable
as per bank code of conduct variable pay. As applicable
complaints (SAC) basis
Or  Department caution memo
root cause analysis
b. 2nd SAC due to staff knowledge (sans rating impact)
(behavioral &
(staff vintage > 4 months in  Rs. 7500/- or 7.5% deduction
knowledge issues)
department / vertical) (*) for the quarter PLP or
> 1 SAC in quarter variable pay. As applicable
SAC for consecutively for 2 quarters  ER memo and downgrade of
SAC for consecutively for 3 quarters annual rating
 Deduction in PLP
Staff exit – Asked to Go
LI / TPP cases Zero tolerance & stern action as per
Non LI / TPP cases – 1st mis – sell current ER grid
complaint during the year ER memo + rating downgrade + Rs.
Mis Sell
> 1 mis – sell complaint in a year 10000/- or 20% (lower of the two)
deduction in PLP for the quarter / or
variable pay, as applicable
Staff exit – Asked to Go

43
INTRODUCTION TO CREDIT CARDS

A payment card issued to the users a as a method of the payment. It allows the cardholder to
pay for goods and services based on the holder's promise to pay for them. The issuer of the
card creates a revolving account and grants a line of credit to the cardholder, from which the
card holder can borrow money for payment to a merchant or as a cash advance.

The size of most credit cards is 85.60mm * 53.98mm, confirming to the ISO/IEC 7810 ID-1
standard.

Credit cards have a printed or embossed bank card number complying with the ISO/IEC 7812
numbering standard. The card number's prefix, called the Bank Identification Number, is the
sequence of digits at the beginning of the number that determine the bank to which a credit
number belongs. This is the first six digits for

Master card and Visa cards. The next nice digits are the individual account number, and the
final digit is a validity check code.

Credit cards have a magnetic stripe confirming to the ISO/IEC 7813. Modern credit cards
have a computer chip embedded in them as a security feature.

The credit card also contains issue and expiration dates, as well as extra codes like issue
numbers and security codes.

TYPES

1. Business credit cards - specialized credit cards issued in the name of business special and
can be typically used for business purposes. They frequently offer rewards in areas such as
shipping, office supplies, travel, and business technology.

44
2. Secured credit cards - is a type of credit card secured deposit account owned by the
cardholder.

3. Prepaid cards - It is a not a true credit card since no credit is offered on these cards.
However cardholder spends money which has been stored via a prior deposit by the
cardholder or someone else.

4. Digital cards - It is a digital cloud hosted virtual representation of any kind of identification
card or payment card such as credit card.

BENEFITS OF CREDIT CARD

1. Time efficient and less use of cash in hand.

2. It helps in keeping a track and record of the expenses.

3. Revolving credit can be used to save.

4. Cash advances are quick and convenient, putting cash in hand whenever required.

5. Credit cards bring incentive offers and discounts on the purchases made.

HDFC CREDIT CARDS

HDFC bank provides a wide range of credit cards that could be spread among different types
of customers.

These credit card offers would provide –

 Unmatched benefits and features

 Cashbacks, discounts, movie tickets

 Easy use services

 Appropriate fees and charges

 Travel facilities

45
JET PRIVLEGE

1. Embark on your exciting journey with one complimentary Jet Airways Ticket* (Base Fare
Waived)

2. Avail of up to 10,000 Bonus Miles, which includes:

o 5,000 Bonus JPMiles on the first swipe of your card within 90 days of card setup

o 5,000 Bonus JPMiles on the total retail spends of Rs. 75,000 and above, within 90
days of the card setup

3. Experience luxury and savings with a discount voucher* worth Rs 750/- to be availed for
booking return a ticket on www.jetairways.com

Renewal Benefit

o Continue your privileged journey with a complimentary Jet Airways Ticket (with
base fare waived off) on renewal

o Avail of 4000 JP Miles on the first swipe on your card within 90 days of card renewal
date

o Experience luxury and savings with a discount voucher* worth Rs 750/- to be availed
for booking a return ticket on www.jetairways.com

Eligibility

You are eligible for a Jet Privilege HDFC Bank World Credit Card based on the following
For Salaried

 Minimum Age 21 years

 Maximum Age 60 years

For Self-employed

46
  Minimum Age 21 years

 Maximum Age 65 years

Jet Privilege HDFC Bank Diners Club

 Welcome Benefit of up to 30,000 Bonus JP Miles and 15 Jet Privilege Tier Points
within the first 90 days*

 Earn 8 JP Miles for every Rs.150 spent

 Get 3X JP Miles for spends on www.jetairways.com

 Unlimited Airport Lounge access to over 600+ lounges globally

 Unlimited golf training and access to premium golf clubs globally

 Avail 24/7 Concierge services for all your bookings

 Exclusive Dining Privileges

Benefits

 Get 1 Jet Privilege Tier Point for every Rs.1,50,000** retail spends with the card to
move towards faster Tier upgrades

 Premiere check-in and additional 10 kg baggage allowance at domestic airport

 Avail Complimentary Base fare waived ticket & Discount voucher for return flight
ticket onwww.jetairways.com upon realization of membership fee

 Avail 5% discount of the base fare on revenue tickets booked onwww.jetairways.com

 Avail the benefits of Classic Banking with us*

 Embark on a delectable journey where you can enjoy discount or other benefits at the
finest restaurants. With exclusive offers and rewards in every bite, gift yourself and
your family an enjoyable dining experience.

47
Jet Privilege HDFC Bank Platinum

 Welcome Benefit of up to 4,000 Bonus JPMiles and one way (base fare waived) Jet
Airways ticket

 Earn 5 JPMiles for every Rs. 150 spent and 15 JPMiles on every flight booked on
www.jetairways.com

 5% Discount on base fare for tickets booked on Jet Airways

 Lounge access through MasterCard Lounge Program.

 Get extended validity of JPMiles for 5 years

 Save up to Rs. 5,000 every year on your fuel transaction and air tickets

 Enjoy Lounge access at airport in India

 Get Renewal Fee waived if you spend Rs. 2.5 lac in 12 months prior to renewal.

 Get extended validity of JPMiles for 5 years

1. Embark on your exciting journey with one complimentary Jet Airways Ticket* (Base Fare
Waived)

2. Avail of up to 4,000 Bonus Miles, which includes,

o 2,000 Bonus JPMiles on the first swipe of your card within 90 days of card setup

o 2,000 Bonus JPMiles on the total retail spends of Rs.50,000 and above, within 90
days of the card setup

3. Experience luxury and savings with a discount voucher* worth Rs750/- to be availed for
booking a return ticket on www.jetairways.com

Renewal Benefit

 Continue your privileged journey with a complimentary Jet Airways Ticket (with base
fare waived off) on renewal date

 Avail of 2000 JP Miles on the first swipe on your card within 90 days of card renewal
date

48
  Experience luxury and savings with a discount voucher* worth Rs 750/- to be availed
for booking a return ticket on www.jetairways.com

 Enjoy 5 JPMiles on every Rs. 150 spent on retail expenses with your JetPrivilege
HDFC Bank Platinum Credit Card.

 Get 3 times more JPMiles on every flight ticket booked on www.jetairways.com.

JetPrivilege HDFC Bank Titanium

Features

 Welcome Benefit of up to 2,000 Bonus JPMiles and Rs. 750 discount voucher on
return Jet Airways ticket.

 Earn 4 JPMiles for every Rs. 150 spent and 12 JPMiles on every flight booked on
www.jetairways.com

 Airport Lounge Privilege through MasterCard Lounge Program.

 Fuel Surcharge Waiver capped at Rs. 250 every billing cycle (ST applicable).

Benefits

 Save up to Rs. 2,500 every year on your fuel transactions and air tickets

 Enjoy Lounge access at airport in India

 Get renewal fee waived if you spend Rs. 1.5 lac in 12 months prior to renewal.

 Get extended validity of JPMiles for 5 years

Welcome Benefit

1. Avail of up to 2,000 Bonus Miles, which includes:

o 1,000 Bonus JPMiles on the first swipe of your card within 90 days of card setup

o 1,000 Bonus JPMiles on the total retail spends of Rs. 25,000 and above, within 90
days of the card setup

49
 3. Experience luxury and savings with a discount voucher* worth Rs 750/- to be availed
for booking a return ticket on www.jetairways.com

Renewal Benefit

o Avail of 1000 Bonus JPMiles on the first swipe on your card within 90 days of card
renewal date

o Experience luxury and savings with a discount voucher* worth Rs 750/- to be availed
for booking a return ticket on www.jetairways.com

Platinum Times Card

Features

 25% off on movies and up to 20% off on dining. (at participating outlets).

 Bouquet of discount vouchers as welcome gift.

 3 Reward Points (RP) on Rs. 150 spent. 10 RP on dining spends on weekdays (Mon-
Fri).

 Fuel Surcharge Waiver capped at Rs. 500 every billing cycle (ST applicable).

 Lounge access through MasterCard Lounge Program.

Benefits

 Get movie discounts of Rs. 1,800 or more in a year!

 Enjoy Lounge access at airport in India

 Earn big discounts of Rs. 9,600 or more every year on dining!

 Save Rs. 1,500 in a year on your fuel transactions

 Scan QR Code on Times Card with a smart phone and access exclusive offers

Benefits

MasterCard Lounge Program Be greeted with luxury each time you travel, with access to
select lounges at airports in India under the MasterCard Lounge Access Program

50
Get movie discounts of Rs. 1,800/- or more in a year! (Assuming you book 4 movie tickets
every month @ Rs. 150 per ticket at participating movie outlet)

 Earn big discounts of Rs. 9,600/or more every year on dining! (Assuming you dine for
Rs. 4,000 every month at participating dining outlet with 20% discount)

 Save Rs. 1,500/in a year on your fuel transactions! (Assuming your average fuel
purchase every month is Rs. 5,000/-)

Eligibility:

Salaried Employee

i) Minimum Age: 21 years

ii) Maximum Age: 60 years

Self Employed

i) Minimum Age: 21 years

ii) Maximum Age: 65 years

Titanium Times Card

Features

 25% off on movies and up to 15% off on dining. (at participating outlets)

 Bouquet of discount vouchers as welcome gift

 2 Reward Points (RP) on Rs. 150 spent. 5 RP on dining spends on weekdays (Mon-
Fri)

 Fuel Surcharge Waiver capped at Rs. 250 every billing cycle (ST applicable).

Benefits

 Get movie discounts of Rs. 1,800 or more in a year!

 Earn big discounts of Rs. 4,500 or more every year on dining!

51
  Save Rs. 1,500 in a year on your fuel transactions

 Scan QR Code on Times Card with a smart phone and access exclusive offers

Features

 Welcome Benefit

Get started on an entertaining journey with a bouquet of Gift Vouchers, across Shopping,
Apparel, Dining and Great many more categories.

Visit www.hdfcbank.timescard.com to view the range of welcome offers.

Great offers on Movie and Dining

Avail amazing round-the-year Discount Offers at participating Movie & Dining outlets in
your city.

Visit www.hdfcbank.timescard.com to views the latest Movie & Dining Offers and outlet
details.

Attractive Reward Points

Earn 2 Reward Points for every Rs. 150 spent on your card.

Weekday Dining Bonanza - Earn 5 Reward Points* on every Rs. 150 spent on Dining spends
on weekdays (Weekdays = Monday to Friday).

Transactions which are classified under the 'Restaurant' Merchant Category Code (MCC) as
defined by VISA/ MasterCard only will be eligible for the bonanza reward points. Merchant
Category Code (MCC) classified under 'Hotel' categories will not qualify for bonanza reward
points.

0% Fuel surcharge

Fuel Surcharge Waiver capped at Rs. 250 every billing cycle (ST applicable). Effective 15th
April, 2022, Reward points will not be accrued for fuel transactions. Service Tax charges on
fuel surcharge is non-refundable

Safe & Secure Transactions

DIP your Chip Card at any Chip enabled POS or swipe your card at any nonchip POS
(Regular POS).

52
Zero liability on lost card

If you lose your Credit Card, report it immediately to our 24-hour call centre. After reporting
the loss, you carry zero liability on any fraudulent transactions made with your card.

Interest free credit facility

Avail of up to 50 days interest free from the date of purchase (subject to the submission of the
charge by the Merchant).

Reward points validity

Reward points are valid only for 2 years from the date of accumulation. ex:- if you receive
reward points in May 2015, same will expire in May 2017. Revolving Credit Enjoy
Revolving Credit on your Credit Card at nominal interest rate, refer Fee and Charges section.

Utility Bill Payment

Register your Titanium Credit Card with SmartPay, HDFC Bank's Utility Bill payment
service. You can then ensure that all your utility bills are paid on time, conveniently and
easily.

Benefits

Get movie discounts of Rs. 1,800/- or more in a year! (Assuming you book 4 movie tickets
every month @ Rs. 150 per ticket at participating movie outlet)

Earn big discounts of Rs. 4,500/(Assuming you dine for Rs. 2,500 every month at
participating dining outlet with 15% or more on every year discount)

Save Rs. 1,500/- in a year on fuel your transactions!

(Assuming your average fuel purchase every month is Rs. 5,000/-)

Scan QR Code on Times Card with a smart phone and access exclusive offers website -
www.hdfcbank.timescard.com

Eligibility

Salaried Employee

i) Minimum Age: 21 years

53
ii) Maximum Age: 60 years

Self Employed

i) Minimum Age: 21 years

ii) Maximum Age: 65 years

All Miles

Welcome benefit 1000 reward points on first usage of card 100 reward points on first usage
of 90 days

Renewal benefit 1000 reward points

All miles travel club benefits

Double reward points on all spending on all miles

Earn 3 reward points for every Rs 150 spent

Reward points can be redeemed for air miles

Fuel surcharge waiver

DINERS CLUB PREMIUM

Membership fee is Rs 500

Renewal fee Rs 500

Dedicated concierge services and dining offers access to 450+ worldwide airport lounges

Complimentary buffet

Exclusive Taj hotel offer on Vivanta and Gateway properties

Exchange point in leading international airline and hotels under the diners club miles
exchange program

4 required points for every Rs 150 spent, interest rate of 0.5% on revolving balances

1 crore air accident insurance

54
Petrol surcharge waiver on minimum Rs 400 to maximum Rs 5000

DINERS CLUB REWARDS

First year membership fee Rs1500

Renewal fees Rs 500

Dedicated concierge services in dining offers

access to 450+ worldwide airport lounges

3 reward points for every 150 spent

Double reward points on incremental retails spends greater than 1000

Double reward point on grocery, super market purchase and airline ticketing

Rs 50 lakh air accident insurance

Convert reward points into air miles in leading domestic airlines

Interest rate is 3.15% per month on revolving balances

Petrol surcharge waiver on min Rs 400 to Rs 5000

The primary focus of offering a wide range of HDFC credit card types such as Travel, Fuel,
Lifestyle, Premium, Rewards and Cashback, Super premium, EMI etc., is to have a category
and card for all possible transactions and to spend patterns of varying consumers. And with
the hassle-free process of availing of the offered credit cards coupled with completely secure
as well as convenient experiences makes it imperative to avail HDFC credit cards. Given that
credit cards tend to involve numerous fees and charges which consumer needs to be aware of,
remember to check HDFC credit card types and charges before zeroing in on any card.

Best HDFC Credit Cards 2022

55
Amongst the wide variety of HDFC credit card types available for widely varying sets of
consumers, below mentioned is a list of some of the best HDFC credit cards which you can
choose when comparing and finalizing any card.

HDFC MoneyBack Credit Card

Joining and Annual Fee: Rs. 500

Key Features:

1. Reward Points earned- Get 2 reward points per Rs. 150 spent, and even more, get 4
reward points per Rs. 150 spent on online shopping

2. Cashback offer- Get your accumulated reward points redeemed for cash credit into
your statement, with the value of 100 points being equal to Rs. 20

3. Fuel Benefits- Availability of a complete fuel surcharge waiver gets you to save up to

Rs. 250 in a billing cycle

4. The benefit of reaching milestones- Get Rs. 500 e-vouchers on spending Rs. 50,000 in
a quarter\

HDFC Regalia Credit Card

Joining and Annual Fee: Rs. 2,500

Key Features:

1. Joining Benefit– Get complimentary membership of Dineout Passport for 1 year

2. Lounge Access Facility- Get 12 complimentary domestic lounge access each year

through Visa/Mastercard, and also avail complimentary membership of Priority Pass
with 6 free visits in each calendar year.

3. Reward Points earned– Get 4 reward points per Rs. 150 spent on every retail spending
except fuel

56
 4. Benefits on reaching milestones – Get 10,000 reward points upon reaching spends of
Rs. 5 Lakh in a year and get an additional 5,000 reward points upon reaching spends
of Rs. 8 Lakhs in a year.

5. Reward Redemption Program– Redeem accumulated reward points against any of the
available and offered premium range of products and vouchers from the rewards
redemption catalogue, against flights and hotel bookings, or against exclusive reward
redemption portal available to be used by HDFC Regalia users.

HDFC Millennia Credit Card

Joining and Annual Fee: Rs. 1,000

Key Features:

1. Cashback earned– Get cashback on all your spending, mainly as 5% cashback upon
shopping via PayZapp for Amazon, Flipkart, Flight & Hotel bookings,5% cash back
upon all kinds of online spending done above Rs. 2,000, and get 1% cashback on all
offline spends as well as wallet reloads of more than Rs. 100

2. Lounge Access Facility– Get 8 free domestic lounge accesses for every year

3. Joining Benefit– Get Rs. 1,000 gift vouchers upon spending Rs. 1 Lakh every quarter
in the HDFC Millennia card’s first year

4. Dining Offers– Get discounts as well as offers through the Good Food Trail Dining
program of HDFC

HDFC Diners Club Rewardz Credit Card

Joining and Annual Fee: Rs. 1,000

Key Features:

1. Joining as well as Renewal Benefits– Get 1,000 bonus reward points upon making
payment of joining and renewal fee each and every year

2. Reward Points earned– Get 3 reward points for spending every Rs. 150 on retail.
Also, get 10X rewards upon shopping with the list of selected partner brands.

57
 3. Reward Redemption Program– Get products as well as vouchers from the rewards
program catalogue when redeeming reward points. Additionally, utilize the
accumulated points to even book flight tickets and hotel stays.

4. Travel Benefits- Get exclusive benefits with a set of partnered travel partners. Also,
get to convert accumulated reward points into air miles of selective airlines. 

5. Lower Forex Markup charge– Just need to pay only 2% markup fee on foreign
currency spending. Check for all such things in HDFC credit card types and charges
mentioned in the Fees and Charges schedule available on HDFC Bank's website's
MITC for credit cards.

HDFC IndianOil Credit Card

Joining and Annual Fee: Rs. 500

Key Features:

1. Get fuel points at listed IndianOil fuel outlets by earning 5% of your spent amount

Get to earn 1 Fuel Point for every Rs.150 spent with HDFC IndianOil Credit Card

1. Get to earn at least 50 litres of free fuel each year

58
DATA AND FINDINGS

The analysis is done on the primary data collected by the customers of HDFC bank. The
questionnaire and interview method has been implied on the walk-in customers of the bank.

The population is considered to be a total lot that has visited the bank for 45 days out of
which a sample of 95 customers have been taken and then further analysis has been done in
order to understand the usage and penetration of credit cards by the customers.

The data is focused on the customers who are already banking with HDFC and have either
accounts in the bank.

OBSERVATION

From a group of 95 individuals -

1. There are 63 users of credit card and 32 members who do not use credit card services
from the bank.

59
 Total Credit Card users out of the sample

Non users
34%

Credit Card users

66%

2. The number of people who are involved into digitalization however are not the credit
card users are 67 and 28 respectively.

Digitalization Users

Non Users
Net Banking Users

The era of digitalization has influenced a lot on the banking sector along with the aid of
influencing the use of credit or debit cards and increasing their customer base.

60
However the observation here depicts that out of total population there are still 29% of the
population that does not use internet for any transactions.

3. The comparison of net banking and credit card users is found to be 52% and 48%
respectively.

Net Banking Users

Credit Card Users

Out of the total users of credit card there is 52% of the population who are the users of
internet banking services.

4. Non users

61
 Total No. of Customers who do
not use both
Net Banking User
Credit Card Non User

The chart signifies all the non-users of any of the services from the sample collected.

32% of the sample is - non net banking users where in rest 32 % donot use both credit card
and net banking.

36% of the sample is non-credit card user however uses net banking or mobile banking
services.

HDFC Card Types Division

62
 HDFC Users of types of Credit Card
Millennia
IndianOil
All Miles
Jet Priveledge
HDFC Users of types of Credit
Diners Card
Master Card
Classic
Regalia
Titanium
Money Back

0 2 4 6 8 10 12 14 16 18 20

Money back is the basic credit card that is given to maximum number of customers and a
super-premium card is another most used credit card which comes under the category of
super-premium card.

6. Number of credit card users in comparison to those who use credit card for internet
purchase

Credit Card v Internet Usage

Yes
No

7. Expectations of the customer while obtaining a credit card

63
 High Limit
Discount
Gifts
Reward Point
Low Interest
Redeem Points
Timely Updating
Add on Feature
Voucher
Payment

High Discount Gift Reward Low Redee Timely Add on Vouche Payment
Limit s Points interest m updating features r
points
17 10 32 1 2 9 3 5 11 5

8. Ratings of credit card services

Rank 6

Rank 5

Rank 4

Rank 3

Rank 2

Rank 1

0 5 10 15 20 25 30

64
9. Rating for HDFC Bank

Rank 6

Rank 5

Rank 4

Rank 3

Rank 2

Rank 1

0 5 10 15 20 25 30

The credit card service have been ranked either Rank 1 or Rank 2 on the satisfaction and
usage level and the services offered and customer care by the bank

65
 Understanding KYC Norms

KYC means “Know your customer”

It is a process by which banks obtain information about the identity and the address of the
customer.

The KYC procedure is to be completed by the banks while opening and periodically update
the same.

KYC stands for “Know your customers”. KYC policy is an important step developed globally
to prevent identify theft, financial fraud, money laundering and terrorist financing. The
objective of KYC is to enable banks to know and understand their customers better and help
them manage their risk prudently.

KYC is a regulatory and legal requirement and KYC policies are framed by respective banks
incorporating the key elements following the Reserve Bank of India’s directive in 2004 such
as customer acceptance policy, customer identification procedures, monitoring of transaction
and risk management

The process of KYC entails identifying the customers and verifying the identity by using
reliable and independent documents or information. While opening different accounts, the
Bank collects documents to identify and verify the customers as required under the existing
laws to demonstrate that it has performed the existing KYC procedures.

KYC has followed by every financial institute while dealing with customers.

KYC procedures needs to be adhered to by a customer during following instances:

 While opening an account in a Bank.

 While applying for a credit card or loan.
 While opening a subsequent account.
 Opening a locker facility.
 When there are not enough documents with the bank in existing account
 Where there are changes in signatories, beneficial owners, etc.

66
  When the bank feels it necessary to obtain additional information f om existing
customers based on conduct of the account.
 While investing in a mutual fund.
 Financial institutes may ask for a mandatory KYC process in other instances too
 Customer can be – A person or entity that maintains an account and/or has a business
relationship with the bank.
 One on whose behalf the account is maintained (i.e., the beneficial owner).
 Beneficiaries of transaction conducted by professional intermediaries, such as
stockbrokers, chartered accountants, solicitors etc. as permitted under the law, and
 Any person or entity connected with a financial transaction which can pose significant
reputational or other risks to the bank, say, a wire transfer or issue of a high value
demand draft as a single transaction.

KYC Controls

 Collection and analysis of basis identity information (“Customer identification

program” or CIP)
 Name matching against lists of known parties.
 Determination of the customer’s risk in terms of propensity to commit money
laundering, terrorist finance, or identity theft
 Creation of an expectation of a customer’s transactional behaviour
 Monitoring of a customer’s transaction against their expected behaviour and recorded
profile as well as that of the customer’s peers
 For accounts of individuals, the bank will require the following information and
documents under KYC.
 Legal name and any other change in names used.
 Correct permanent address
 The individuals will have to provide the original document for verification and submit
a copy for the bank’s record.

67
Identity Proof

1. Passport
2. PAN Card
3. Voter’s Identity Card
4. Driving License
5. Ration Card
6. Identity Card (subject to the bank’s satisfaction)

Address proof

1. Utility Card
2. Bank account statement received by mail / courier along with signature verification
by the banker or a cheque drawn on that for a minimum amount as specified by the
bank, deposited into the account.
3. Ration Card
4. Letter from employer

68
RE – KYC
It is a process of updating the information of the customer on a periodic basis as specified by
the guidelines given by RBI.

Response: KYC means “Know your customer”. It is a process by which banks obtain
information about the identity and address of the customers. This process helps to ensure that
bank’s services are not misused. The KYC procedure is to be completed by the banks while
opening accounts and also periodically update the same.

Rules regarding periodically of KYC

Updating of KYC records depending on the risk perception of the bank.

 For high-risk customer, KYC is done at least every 2 Years.

 For medium-risk customers, KYC is done at least every 8 Years.
 For low-risk customers, KYC is done at least every 10 Years.

Customers who are minors must submit fresh photograph on becoming major.

Government of India has notified six documents that are

1. Passport
2. Driving License
3. Voters
4. Identity Card
5. PAN Card
6. Aadhaar Card

Why does the bank ask you for proof of your identity and address?

The identification of a customer is a very critical process with a view to protect the customer
interests by preventing from fraudsters who may use the name, address and forge signature to
undertake benami / illegal business activities, encashment of stolen drafts, cheques, dividend
warrants, etc. This also helps to safeguard banks from unwittingly used for the transfer of
deposit of funds derived from criminal activity or for financing terrorism. Identification of
customers will also help to control financial frauds, identify money laundering and suspicious
activities, and for scrutiny / monitoring of large value cash transactions.

69
Are KYC requirements new?

No, KYC requirements have always been in place and Banks have been taking KYC
documents in accordance with the guidelines issued by RBI from time to time. RBI has
revisited the KYC guidelines in the context of recommendations made by the Financial
Action Task Force (FATF) on Anti Money Laundering standards and on Combating
Financing of Terrorism and enhanced the KYC standards in line with international
benchmarks.

Is KYC mandatory?

Yes. It is a regulatory and legal requirement. Regulatory: In terms of the guidelines issued by
the Reserve Bank of India (RBI) on November 29, 2004 on Know Your Customer [KYC]
Standards – Anti Money Laundering [AML] Measures, all banks are required to put in place
a comprehensive policy framework covering KYC Standards and AML Measures. Legal: The
Prevention of Money Laundering Act, 2002 (PMLA) which came into force from July 1,
2005 (after “rules” under the Act were formulated and published in the Official Gazette) also
requires Banks, Financial Institutions and Intermediaries to ensure that they follow certain
minimum standards of KYC and AML as laid down in the Act and the “rules” framed there
under.

When does KYC apply?

KYC will be carried out at the following stages:

1. Opening a new account

2. Opening a subsequent account where documents as per current KYC standards not been
submitted while opening the initial account

3. Opening a Locker Facility where these documents are not available with the bank for all
the Locker facility holders

4. When the bank feels it necessary to obtain additional information from existing customers
based on conduct of the account

5. When there are changes to signatories, mandate holders, beneficial owners etc. KYC will
also be carried out in respect of non-account holders approaching the bank for high value
one-off transactions.

70
Who is your contact point in the bank for KYC purposes?

Your contact point in the Bank will be the Relationship Manager / the official who opens
your account and who is in touch with you for your transactions.

These are 4 forms for RE – KYC

HDFC RE-KYC FORM FOR INDIVIDUALS

HDFC RE-KYC FORM FOR NON-INDIVIDUALS

HDFC RE-KYC FORM FOR PROPERIETER

HDFC RE-KYC FORM FOR INDIVIDUALS FOR LOW-RISK CUSTOMER

71
Conclusion

1. Credit card usage has been observed at a high rate by the bank customers.

2. The study depicts that private sector banks have more credit card users as compared to
public sector banks.

3. It shows that the credit card penetration has increased with the increase in digitalization,
offers and facilities provided by the banks.

4. Credit card is a risk involved product therefore, it is essential to give it to eligible

customers only to reduce NPA.

Banks doing KYC monitoring for anti-money laundering (AML) and checks relating to
combating the financing of terrorism (CFT) increasingly use specialized transaction
monitoring software, particularly names analysis software and trend monitoring software.

Know Your Customer processes are also employed by regular companies of all sizes, for the
purpose of ensuring their proposed agents', consultants' or distributors' anti-bribery
compliance. Banks, insurers and export credit agencies are increasingly demanding that
customers provide detailed anti-corruption due diligence information, to verify their probity
and integrity. Some specialist consultancies help multinational companies and SMEs conduct
Know Your Customer processes when entering new market.

There is no escaping the paperwork while investing in financial products. Be it, opening a
new bank account, Demat account or buying insurance, filling the Know Your Client (KYC)
documents is a mandatory procedure today.

72
Recommendation

 The bank must give detailed information of each product before selling it to the
customers.
 The charges levied or any term or condition must be clearly specified and personally
told to the customer in order to reduce and later complaints.
 Credit cards are a product with highest charges or interest in case of delay of payment.
Therefore a method must be introduced in order to achieve timely payments either
through savings or any other mode in order to reduce the cause.
 Digitalization must be connected to the use of credit cards so that customers can
 take benefit of both the products.
 Thus, the banking industries must continuously measure and improve these
dimensions in order to gain customers loyalty.

73
Limitations

 The study is only for HDFC Bank confined to a particular location and a very small
sample of respondents. Hence the findings cannot be treated as representative of the
entire banking industry.
 The study can also be not being generalized for public and private sector banks of the
country.
 Respondents may give biased answers for the required data. Some of the respondents
did not like to respond.
 Respondents tried to escape some statements by simply answering “neither agree nor
disagree” to most of the statement. This was one of the most important limitations
faced, as it was difficult to analysis and come at a right conclusion.
 In study I have included 50 customers of bank because of time limit.

74
Bibliography

References

Kotler Philip, marketing management, (Pearson education, 12th edition) Malhotra K. Naresh,
marketing research (An applied orientation), Research design, (Prentice hall of India pvt. 5th
edition)

Zeithmal V. A., Grembler D.D., Bitner M.j., and Pandit A.: Service Marketing Integrated
customer Focus across the Firm * (4th Edition) M.K. Rampal : Service Marketing

Websites:

www.hdfcbank.com

www.hdfcindia.com

www.wikipedia.org

www.marketresearch.com

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