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Introduction

The last year financial crises have become the main cause for recession which was started in 2012 from US and was spread across the world. The world economy has been majorly affected from the crisis. The securities in stock exchange have fallen down drastically which has become the root cause of bankruptcy of many financial institutions and individuals. The root cause of bankruptcy of many financial institutions and individuals. The root cause of the economic and financial crisis is credit default of big companies and individuals which has badly impacted the world economy. So in the present scenario analyzing ones credit worthiness has become very important for any financial institution before providing any form of credit facility so that such situation doesnt arise near future again. Analysis of the credit worthiness of the borrowers is known as Credit Appraisal. In order to understand the credit appraisal system followed by the banks this project has been conducted. The project has analyzed the credit appraisal procedure with special reference to SBI which includes knowing about the difference credit facilities provided by the banks to its customer, How a loan proposal is being made, what are the formalities that is to be satisfied formalities that is to be satisfied and most importantly knowing about the various credit a appraisal techniques which are different for each type of credit facility. Before going further it is necessary to understand the need and basic framework of the project. Therefore this chapter provides an introduction to the topic, objective of the project, reasons for selecting the project and the basic structure and framework how the project proceeds. In order to understand the importance of the topic selected an introduction to the overview of the commercial bank, its functions, and present trends and growth in bank credit are required and it is covered in this chapter.

What is banking?
Banks act as payment agents by conducting checking or current accounts for customers, paying cheques drawn by customers on the bank, and collecting cheques deposited to customers' current accounts. Banks also enable customer

payments via other payment methods House (ACH), Wire transfers or telegraphic machine(ATM).

such as Automated Clearing transfer, and automated teller

Banks borrow money by accepting funds deposited on current accounts, by accepting term deposits, and by issuing debt securities such as banknotes and bonds. Banks lend money by making advances to customers on current accounts, by making installment loans, and by investing in marketable debt securities and other forms of money lending. Banks provide different payment services, and a bank account is considered indispensable by most businesses and individuals. Non-banks that provide payment services such as remittance companies are normally not considered as an adequate substitute for a bank account.

What is Credit Facility?


Unlike personal loans (where people borrowing the funds and the collateral are not likely to change), loans in the world of business require additional flexibility in order to meet the needs of the business as well as satisfy the requirement of the lender. Accomplishing this seemingly difficult task is done by using a credit facility which is an overall credit line that can be broken into multiple credit lines and collateral. The term can be understood by giving light on following points:

CREDIT (LOANS AND ADVANCES) The profit of a bank depends primarily on the utilization of its fund. But Bank cannot lend its fund fully. As per Banking Company Act 1991 every banking company has to maintain a specified minimum (presently 25%) of the total of its demand and time liabilities in the form of cash and approved securities with RBI. This percentage or ratio is termed Statutory Liquid Ratio. Further every scheduled bank has to maintain with RBI an average daily balance the amount of which has not to be less than a particular percentage (presently 6%) of the total of its demand and time liabilities. As such Bank generally goes for short-term finance although a

small portion of its total deposit is invested as long term lending. Banks allow different forms advance.

Credit Department
Credit Department Banking business primarily involves accepting deposit from the public and investing or lending the same and thereby making profit out of it. However, lending money is without risk and therefore banks make loans and advances to farmers, traders, businessmen and industrialist against either tangible (land, building, stock etc.) or tangible security. Even then, the banks run the risk of default in repayment. Therefore, the banks follow cautious measures while lending money to others. This core function of a bank is performed by the Credit Department of the bank. In this case, the relationship of a bank and customer is that one of the creditor and debtor. Unlike personal loans where the person borrowing the funds and the collateral are not likely change, loans in the world of business require additional flexibility in order to meet the needs of the business as well as satisfy the requirement of the lender.

Types of Credit Schemes Offered by SBI


Scheme for Trades -Liberalised Trade Finance Handy Loans Scheme Corporate Loan Current Account Plus Rent Plus SBM Paryatan Plus SBM School Plus

3.3 Nature of the Study


As concerned to my study questionnaires are used to collect the data and the study is totally descriptive in nature because we have used the primary data here.

3.4.1 Sampling Plan - Sampling is an effective step of collection of primary


data and has a great influence on the quality of results. The sampling plan includes the population, sampling size and sampling design.

Population:
The study aimed to include the banks of Yamuna Nagar and the customers of different banks.

Sample Size:
The sample size for the research would be 50 customers and 4 banks.

Sample Technique:
Random sampling technique is used.

Method Of data collection


Primary data collection method is used to collect the data. Here questionnaires are used for the collection of data about their viewpoints and what are their responses towards the E- baking. The secondary data was collected through various websites, books, journals etc

3.5 Data analysis and interpretation


Data analysis and interpretation should be done with the help of the diagrams and the analysis of the data. The average method is use to analyze the data and to find out the conclusions.

SCOPE OF THE STUDY

This study is analysis and comparison of home loans provided by the SBI and PNB banks. It is helpful in analyzing the home loan service provided to the customer and their comparison. OBJECTIVES To study the cost of home loans provided by the bank. To know that which bank provide batter loan schemes. To analyze the home loan scheme by PNB and SBI banks. To know the consumer perception about the home loan of PNB and SBI.