A PROJECT REPORT ON A STUDYOF LOAN PROCEDURE OF CONSUMER DURABLE PRODUCT AT BAJAJ

FINSERV LENDING LTD, PUNE BATCH 2012-2014

SUBMITTED TO UNIVERSITY OF PUNE IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE A
WARD OF THE DEGREE MASTER OF ADMINISTRATION SUBMITTED BY SUSHIL MAHADEV DESAI MB
A (FINANCE)
UNDER THE GUIDENCE OF PROF. PADMALOCHANA BISOYI
Pimpri-Chinchwad Education Trusts S.B. PATIL INSTITUTE OF MANAGEMENT SECTOR 26, P
RADHIKARAN, NIGDI, PUNE-411044.
1

DECLARATION
I ,the undersigned hereby declare that Project Report entitled A STUDY OF LOAN PR
OCEDURE OF CONSUMER DURABLE PRODUCT AT BAJAJ FINSERV
LENDING written and submitted by me to University of Pune , In partial fulfillmen
t of requirement for the award of the degree of MASTER OF BUSINESS
ADMINISTRATION under the guidance of
PROF.PADMALOCHANA BISOYI is my
original work and the conclusion drawn therein are based on the material collect
ed by me.
Place: Pune Date
SUSHIL DESAI Research Student
2

TABLE OF CONTENTS
CHPTER NO.
CONTENTS Executive Summary
PAGE No. 9 10 - 14 10 11 11 11 12 13 13 13 13 13 14 14 15 - 29 16 16 17
I
INTRODUCTION Theoretical Background 1.1 What is Finance? 1.2 Who is Consumer 1.3
What is Consumer Finance 1.4 What is Consumer Durable Finance 1.5 What is EMI C
ard 1.6 Advantages of the project 1.7 Meaning of Banking 1.7.1 Definition of Ban
king 1.8 Meaning of NBFC 1.8.1 Definition of NBFC 1.9 Leasing Companies
II
PROFILE OF THE ORGANIZATION 2.1 Historical Background of the organization 2.1.1
Area of operation 2.1.2 Vision and Mission of the organization
3

2.1.3 Objective of the organization 2.1.4 Organizational Hierarchy 2.1.5 Product

Profile of the company 2.2 Total use of sales force software 2.3 Current pictur
e of the organization 2.4 Future plan of the organization 2.5 Other relevant inf
ormation of the organization 2.6 Awards III RESEARCH DESIGN AND METHODOLOGY 3.1
Introduction 3.2 Meaning of Research 3.3 Definitions of Research 3.4 Characteris
tics of Research 3.5 Types of Research 3.6 Research Design 3.7 Source of Data Co
llection 3.8 Objective of the project 3.9 Scope of the project 3.10 Research Met
hodology 3.10.1 Time Frame
17 18 - 21 22 - 23 24 25 26 29 - 28 28 - 29 30 - 36 31 31 31 - 32 32 - 33 33 33
- 34 34 34 35 35 35
4

3.10.2 Analysis of Data 3.11 Limitation of the project 3.12 Key Concepts IV ANAL
YSIS AND INTERPRETATION OF DATA 4.1 Case Study 4.2 Process Adopted 4.2.1 Applica
tion process for loan approval 4.2.2 Surrogates for loan approval V VI VII VII V
III FINDINGS SUGGESTIONS COCLNUSION BIBLIOGRAPHY ANNEXURE
35 35 35 - 36 38 - 54 39 - 48 49 49 - 52 52 - 54 55 - 56 57 - 58 59 - 60 61 - 62
63 - 66
LIST OF TABLES
PAGE NO. TABLE NO. 1.1 2.1 2.2 NAME OF THE TABLE Difference between the NBFC and
Commercial Bank Organization Chart of Bajaj Finserv Performance Highlights 14 2
2 25
5

3.1 4.1 4.2 4.3 4.4 4.5

Scheme Chart for Loan Approval Gross Loan Deployment of Bajaj Finserv Case Study
1 Case Study 2 Case Study 3 Case Study 4
36 38 40 42 44 47
LIST OF FIGURES
FIGURE NO. 2.1 2.2 2.3 2.4 2.5 2.6 2.7 4.1 4.2 4.3 NAME OF THE FIGURE Different
Departments Organizational Hierarchy Product Profile of The Organization Strengt
h of The Organization Weakness of The Organization Opportunities of The Organiza
tion Threats of The Organization Gross Loan Deployments Flow Chart of The Applic
ation Process For Loan Approval Surrogates Required for Loan Approval PAGE NO. 1
8 19 - 21 23 25 27 27 28 39 51 - 52 54
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Acknowledgement
I consider it a privilege to express a few words of gratitude and respect to all
who guided and inspired me in successful completion of this project . I am over
whelmed with pleasure to express my gratitude towards Mr. Sumer Basera (Sales Ma
nager) BAJAJ FINSERV LENDING . For granting this project to me and giving me an
opportunity to work with such an esteemed organization . It is my sincere duty t
o do my best ,so as to recognize as one amongst the most successful professional
,which I always strive to be .This bring along and frame to my beloved institut
ion, the S.B.PATIL INSTUTUTE OF MANAGEMENT . I also extend particular thanks to
our Director Dr. Daniel Penkar and my Project
Guide PROF.PADMALOCHANA BISOYI for guiding me in my project. I would also like t
o thank all the teaching and non teaching staff member and all others who helped
me directly or indirectly in the successful completion of this project . There
is no love like parents. I pay my most sincere regards to my parents ,deserves a
very special word of appreciation for their invaluable support ,encouragement a
nd pains taking efforts ,without which this goal would have been a much difficul
t .
SUSHIL DESAI Research Student
7

EXECUTIVE SUMMARY
I have taken Finance as a specialization with the title of A STUDY OF LOAN PROCED
URE OF CONSUMER DURABLE PRODUCT AT BAJAJ FINSERV LENDING The objective behind thi
s project was to primarily focus on Modus Operandi of Bajaj Finance for Finance
of Consumer Durable products. This required a fist hand experience in understand
ing end to end process flow for loans processing to payment disbursement. Also I
discuss about the Bajaj EMI Card, the Bajaj Finserv Lending Company which is on
e of the lending company they also make available EMI Card option for the loan.
I have collected the Secondary data from Books, Company Annual Report & internet
Articles etc. Bajaj Finance Ltd has only one market sales of Consumer Durable L
oan product provided in EMI based loan. I also focus on the surrogates required
for loan approval, which documents are necessary for approval of loan. And also
to show the SWOT analysis of Company. I have also tried to explain the loan proc
edure and its approval by enclosing some case studies. Through this project, I l
earn how to given a loan on consumer durable product and how to solve customer d
ifficulties about the documentation. I was dealing with proper customer, provide
d them loans by completing their files and getting the approval online form Baja
j Server called as Galaxies Portal. This process helped me to better understand th
e Loan procedure of Consumer durable product at Bajaj Finserv Lending.
8

CHAPTER I INTRODUCTION
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THEORETICAL BACKGROUND
1.1: What is Finance? "Finance is the management of money and other valuables, w
hich can be easily converted into cash." A category of stocks containing firms t
hat provides financial services to commercial and retail customer. This sector i
ncludes banks, investment funds, insurance companies and real estate. Financial
services perform best in low interest rate environments. A large portion of this
sector generates revenue from mortgages and loans, which gain value as interest
rates drop. Furthermore, when the business cycle is in an upswing, the financia
l sector benefits from additional investment improved economic condition usually
lead to more capital projects and increased personal investing. New projects re
quire financing, which usually leads to a large number of loans. Finance is often
defined simply as the management of money or funds management. Modern finance, how
ever, is a family of business activity that include the origination, marketing,
and management of cash and money surrogates through a variety of capital account
s, instruments, and markets created for transaction and trading assets, liabilit
ies, and risks. Finance is conceptualized, structured, and regulated by a comple
x system of power relation within political economies across state and global ma
rket. 1.2 : Who is consumer? An individual who buys products or services for per
sonal use and not for manufacture or resale. A consumer is someone who can make
the decision whether or not to purchase an item at the store, and someone who ca
n be influenced by marketing and advertisements. Any time someone goes to a stor
e and purchases a toy, shirt, beverage, or anything else, they are making that d
ecision as a consumer. Under the consumer protection act 1985any person who buy an
y goods for consideration, who include a person who obtain such goods for resale
or for any commercial purpose. 1.3 : Consumer Finance: The division of retail ban
king that deals with lending money to consumers. This includes a wide variety of
loans, including credit cards, mortgage loans, and auto loans, and can also be
used to refer to loans taken out at either the prime rate or the subprime rate.
10

The consumer finance is a win-win system in which everyone wins. For the consume
rs it is an opportunity to upgrade standard of living here and now instead of wa
iting for years of savings to accumulate. For manufacturer, consumer finance sti
mulates demand and brings down
inventories. For dealers it is one type of sales booting. For finance company it
is profit generation. Consumer finance has to do with the lending process that
occurs between the consumer and a lender. In some instances, the lender may be a
bank or financial institution. At other times, the lender may be a business tha
t offers in house credit in exchange for the business of the consumer. Consumer
finance can include just about any type of lending activity that result in the e
xtension of credit to a consumer. 1.4: Consumer Durable Finance: Consumer durable
finance means to provide the finance on the consumer durable product like, wash
ing machinist, TV etc. it is known as consumer durable finance The consumer durab
le finance provide the 0% interest on durable product to the consumer, This give
s customers another compelling reason to opt for 0% interest Consumer Durables F
inance for their durables purchases. Consumer durables finance schemes are gener
ally available at the dealer location (point of sale) or the showroom. The benef
iciaries are not just customers lenders, manufacturers, and retailers too benefi
t. Manufacturers gain from the resultant boost to sales and increased consumer p
reference towards high-margin products. Financing schemes enable customers, espe
cially those with lower income levels, to use future income streams to buy consu
mer products upfront and pay in installments over a period. The most popular fin
ance scheme prevalent in the market currently is the 12/4 scheme, where the fina
ncier collects the amount for the first four months as initial down payment from
the buyer and then disburses the full amount to the dealer. The financier then
recovers the balance amount in 8 monthly installments from the buyer. The intere
st and processing charges are generally paid upfront by the manufacturer to the
financier. Consumer durables financing appears robust, continued support from ma
nufacturers (who are effectively bearing the interest costs currently) would be
critical to sustain high growth.
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1.5: EMI Card:

Bajaj Finserv Lending launched an innovative product for its exis
ting Consumer Durables Finance customers.
Through the EMI card, an existing cust
omer can buy any consumer durable by simply swiping the EMI card across our deal
er partner outlets, without the need for any repeated documentation. This is ano
ther industry first, leveraging the technology investments the company has made
and is a proof point of our commitment to investing in growing our relationship
with our existing customers.
1.6: Advantages of Project:
Schemes related to the consumer durable finance is always welcome by the custome
rs.
Tracking methodology of customer is very smoothly (by using EMI card).
Provi
sion of easy, simple and adequate credit.
1.7: Meaning of Banking:
Transacting business with a bank; depositing or withdrawing funds or requesting
a loan etc. or engaging in the business of banking; maintaining savings and chec
king accounts and issuing loans and credit etc 1.7.1: Definition of Bank: An esta
blishment for custody of money, which it pays out on customer s order."
1.8: Meaning of NBFC:
NBFC means Non-banking financial company. A non-banking financial company (NBFC)
is a company registered under the Companies Act, 1956 of India and is engaged i
n the business of loans and advances, acquisition of shares/stock/bonds/debentur
es/securities issued by government or local authority or other securities of lik
e marketable nature, leasing, hirepurchase, insurance business, chit business, b
ut does not include any institution whose principal business is that of agricult
ure activity, industrial activity, sale/purchase/construction of immovable prope
rty.
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Classification: 1. Developing finance institutions 2. Leasing companies 3. Inves

tment companies 4. House finance companies 5. Venture capital management 1.8.1:
Definition of NBFCs: Non-banking financial companies, or NBFCs, are financial in
stitutions that provide banking services, but do not hold a banking license. The
se institutions are not allowed to take deposits from the public. Nonetheless, a
ll operations of these institutions are still covered under banking
Table No.1.1: Difference between NBFC and Commercial Bank: Sr no. NBFC Commercia
l Bank
1 2 3
It is no facility to issue cheque against The cheque can be issued against bank
bank deposits. Higher Rate of interest on loan It is specialized in one type of
assets deposits. Lesser rate of interest on loan It hold variety of assets in fo
rm of loan, cash etc
1.10: Leasing Companies:
Financial leasing companies engage in financing the purchase of tangible assets.
The leasing company is the legal owner of the goods, but ownership is effective
ly conveyed to the lessee, who incurs all benefits, costs, and risks associated
with ownership of the assets. In leasing finance, the borrower of the capital eq
uipment is allowed to use it, as a hire, against the payment of a monthly rent.
The borrower need not purchase the capital equipment but he buys right to use it
.
13

CHAPTER II PROFILE OF THE ORGANISATION

14

2.1: Historical Background of the Organization:

Bajaj Finserv was formed in April 2007 which is situated in 4TH Floor, Bajaj Fin
serv Corporate Office, Pune-Ahemednager Road Viman Nagar, Pune 411014, Maharasht
ra. As a result of its demerger from Bajaj Auto Limited to act as a pure play fi
nancial services business. The process of demerger was completed in Feb 2008. Th
is demerger was not only to unlock values in the high growth business areas of A
uto, Insurance, Finance sectors and Wind Power but also to run independently the
se core businesses and to strengthen the competencies. The wind power project, t
he stakes in the life and general insurance companies and consumer finance along
with their respective assets and liabilities got vested in Bajaj Finserv Limite
d. In addition to that cash and cash equivalent of INR 8,000 million (then marke
t value) was also transferred to the company. The demerger has enabled investors
to hold separate focused stocks and also facilitate transparent benchmarking of
the companies to their peers in their respective industries. The constantly cha
nging demographics and dynamics of the Indian economy, has led to creation of va
rious needs of the average Indian customer. The Indian customer now demands prop
er avenues of channelizing their savings, financial protection and is also desir
ous of spending more on valuable goods and services. All these wants need to be
met by dynamic players in the financial services space. Bajaj Finserv was formed
specifically to cater to these needs. The company was also formed to touch and
improve the lives of a growing number of people in the country, and in doing so,
deliver superior corporate values to its shareholders. The operating companies
carry with them the Bajaj brand, which carries with it decades of commitment to
business ethics, integrity and highest standards of fiduciary responsibility.
2.1.1: Area of operation:
Consumer Durable Finance
Two and Three Wheeler Finance
Vendor finance
Construction Equipment Finance
15

Lifestyle product finance

2.1.2: Vision and Mission of the Organization:

Vision: Bajaj Finserv has a vision to become a full-fledged financial services c
ompany and be the financial partner to the Indian consumer and help him across h
is financial needs, whether for finance, for investment management, for protecti
on or for post-retirement support, throughout his lifecycle. Mission: Bajaj Fins
erv aims to be the most useful, reliable and efficient provider of Financial Ser
vices. It is our continuous endeavor to be a trustworthy advisor to our clients,
helping them achieve their financial goals.
2.1.3: Objective of the Organization:
Our main objects as contained in our Memorandum of Association include: 1. To Fi
nance industrial by way advance ,deposit or lend money, securities and propertie
d or with any Company, Body corporate, trust, firm, person or association whethe
r falling under the same management or otherwise, with or without security and o
n such terms as may be determined from time to time, and to carry on and underta
ke the business of finance and investment and to provide venture capital, seed c
apital, loan capital and to participate in equity preference share capital or to
give guarantees on behalf of the company in the matter and to promote companies
engaged in industrial and trading business and to act as Financial Consultants,
Management Consultants, Brokers, Dealers, Agents and to carry on the business o
f share broking, money broking ,exchange broking, bill broking and general broke
rs for shares ,debentures, debenture-stock, bonds, units, obligations, securitie
s ,commodities, bullion currencies and to manage the funds of any person, firm,
body corporate or trust by investment in various avenues like Growth Fund, incom
e fund, risk fund, tax exempt funds, pension /superannuation funds and to pass o
n the benefits of portfolio investments to the investor as dividends, bonus, int
erest, etc. 2. To carry on the business as an investment company and to underwri
te, sub-underwrite, to investigating , and acquire by gift or otherwise and hold
, sell, buy or otherwise deal in shares debentures, debentures-stocks, bond, uni
ts, obligations and securities issued or
16

guaranteed by Indian or Foreign Governments, States, Dominions, Sovereigns, Muni

cipalities.
DEPARTMENTS
Administration
Collections
Marketing
Product
Credit Team
Human Resources
Operations
Sales
Figure No. 2.1: Different Departments
2.1.4: Organization Hierarchy:
A key issue in accomplishing the goals identified in the planning process is str
ucturing the work of organization. Organizations are group of people, with ideas
and resources working toward common goals. The purpose of the organizing functi
on is to make the best use of the organizations resources to achieve organizatio
nal goals. Organizational Structure is the formal decisions making framework by
which job tasks are divided, grouped and coordinated. Formalization is an import
ant aspect of structure. It is the extent to which the unit of organization is e
xplicitly defined and its policies, procedures and goals are clearly stated. It
is the official organizational structure conceived and built by top management.
The formal organization can be seen and represented in chart form. An organizati
on chart displays the organizational structure and shows job titles, lines of au
thority and relationship between departments. Organizational Structure allows th
e expressed allocation of responsibilities for different functions and processes
17

to different entities. Ordinary description of such entities is as branch site,

department, work group and single group of people.
Rahul Bajaj [Chairman]
[CHAIRMAN]
Nanoo Pamnani RAHUL BAJAJ [Vice-Chairman]
[CHAIRMAN] [CHAIRMAN]
Rajeev Jain RAHUL [Ceo]BAJAJ
[CHAIRMAN]
Rakesh Bhatt [Coo]BAJAJ RAHUL
[CHAIRMAN]
[CHAIRMAN]
Devang Mody [President Consumer Business] RAHUL BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Deepak Reddy [Chief RAHUL Human BAJAJ Resources]
[CHAIRMAN]
[CHAIRMAN]
Manev Mianwal RAHUL BAJAJ [Group Marketing Head]
[CHAIRMAN] [CHAIRMAN] RAHUL BAJAJ [CHAIRMAN] 18
[CHAIRMAN]

Pankaj Thadan [Chief Compliance Officer]

Amit Gainda Business Head - Mortgages RAHUL BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Rajesh K [Chief Officer] RAHUL Risk BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Ashish Panchal [Business Head - Credit RAHUL BAJAJ Cards & Loan]
[CHAIRMAN] [CHAIRMAN]
[CHAIRMAN]
Diwakar Pundir RAHUL BAJAJ [Chief Credit Officer]
[CHAIRMAN]
Ashish Sapra [Business Head - Cross Sell] RAHUL BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Amit Raghuvanshi [Business Head - Sales Finance] RAHUL BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Atul Jain [Chief Collections RAHUL BAJAJ Officer]
[CHAIRMAN] [CHAIRMAN] RAHUL BAJAJ [CHAIRMAN] 19
[CHAIRMAN]

Samir Mehta [Business Head Commercial Lending]

[Business Head - Insurance RAHULServices] BAJAJ
[CHAIRMAN]
B. Sreenivas [CHAIRMAN]
Vivek r. Likhite [CHAIRMAN] [group corporate audit head]
RAHUL BAJAJ [CHAIRMAN] [CHAIRMAN]
M M Muralidharan [Treasurer] RAHUL BAJAJ
[CHAIRMAN]
Deepak Bagati [Business Head - Business Loans] RAHUL BAJAJ
[CHAIRMAN]
[CHAIRMAN]
Samir Satyam [BH Loanbajaj Against Securities] Rahul
[chairman]
[chairman]
Sanjeevvij [BH - Construction RAHUL BAJAJEquipment]
[CHAIRMAN] [CHAIRMAN]
[CHAIRMAN]
Figure No.2.2: Organizional Hierarchy
RAHUL BAJAJ [CHAIRMAN] 20

Table No.2.1: Organization Chart of Bajaj Finserv: Name Rahul Bajaj Nanoo Pamnan
i Madhur Bajaj Rajiv Bajaj Sanjiv Bajaj D.S.Mehta D.J.Balajirao Dipak Poddar Des
ignation Chairman Vice-chairman Major director Director Non executive director M
ajor director Director Director
Ranjan Sanghi
Director
Rajendra Lakhotia
Director
Omkar Goswami
Director
2.1.5: Product Profile of the Organization:
Bajaj Finserv Lending offers loans for various needs. We offer loans for Bajaj A
uto Two Wheelers under the name of Bajaj Auto Finance Ltd. We offer Consumer Dur
able Loans, Personal Loans, Loan against Property, Small Business Loans, Constru
ction Equipment Loans, Loan against Securities and Insurance Services under the
name of Bajaj Finserv Lending. Bajaj
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Finserv Lending is one of the most diversified NBFCs in the market catering to m
ore than 5 million customers across the country. Apart from being a well-recogni
zed organization, they pride us for holding the highest credit rating of FAAA/St
able for any NBFC in the country today. The product offerings include Consumer D
urable Loans, Personal Loans, Loan against Property, Small Business Loans, Two-w
heeler and Three Wheeler Loans, Construction Equipment Loans, Loans against Secu
rities and Insurance Services.
Home Loan
Construction Equipment Loan Product Portfolio
Consumer Durable Loan
Mortgage Loan
Three/Two Wheeler Loan
Personal and Small Business Loan
Figure No.2.3: Product Profile of the Organization
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Products Covered:
0% interest Consumer Durables Finance is available on a wide range of products a
nd in over 101 cities across India. Hereunder is an indicative list of products
covered?
LED/LCD/CTV
Washing Machines
Microwave Ovens
Refrigerators, Cameras/Cam
corders
Dishwashers
Generators Cooking Range products
Dryers Laptops / Desktops
(Select) Smart phones (Select)
Air purifiers / Water Purifiers / R.O.
Music Syst
ems Inverters
Air conditioners
2.2: Total Use of Sales Force Software:
"Sales force CRM is nothing short of a revolution for our sales fianc business! Ri
se in transactions from 1500 per day during holiday season to a record 8500 in a
single day, processing one transaction every 4 sacs during peak hour with sales
force CRM. Challenge
Needed solution with unlimited scalability for end to end
new loan underwriting and to cross sell multiple products on existing customer d
atabase Specifically sought best in the business to minimize time and resource inv
estment in IT and allow focus to remain on serving customers Wanted high degree
of flexibility to accommodate dynamic changes in market place
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Solution users in April09

Salesforce.com implementation partner Wipro implemented Sales Force CRM for 300
Deployed across Call Centre, Sales, Credit and Operations teams Implementation c
ycle, from concept to solution build, of just 3 months Integration with Dialer,
Dedupe system, Credit Bureau, SMS, and more recently Google Maps (to access cust
omer locations from within salesforce.com) 2.3: Current Picture Of The Company:
Bajaj Finance reports AUM of RS.19229 crores and highest ever quatarly profit af
ter tax of RS,176 crores-A growth of 27% over corresponding quarter of previous
year. The Board of Director of Bajaj Finance Limited in their meeting held today
took on record the unaudited Financial Result of the company for 1st quarter en
ded 30 June 2013. Table No.2.2: Performance Highlights: Sr.No. Particular Financ
ial Year 2013 1 2 3 4 5 Total Income (Cr.) Profit After Tax (Cr.) Customer Acqui
red (No.) Deployments (Cr.) Loan losses and provisions (Cr.) 703 139 7,52,231 62
50 41 Financial Year 2014 932 176 9,69,447 8250 60 Performance Increasesed 33% 2
7% 29% 32% 46%
Launch of Digital Product Financing: The company added digital product financing
as an extension to its consumer electronics financing business.
Launch of Rural
Lending: The company launched its rural financing business in 7 branches and 30
spokes across Maharashtra.The full product suite consisting of consumer electro
nics financing,gold loans and refinancing loans have been launched in these mark
ets.
24

Among the top 3 BFSI companies to work for in India: The company has been ranked
as the 3rd Best Financial Service Company to Work For in India by Great Place to
Work Institute-Amongst the most prestigious employer award in India.
2.4: Future Plan of the Organization:
Application for Banking License: Bajaj Fin
serv Limited, the holding company of Bajaj Finance Limited, has submitted its ap
plication to Reserve Bank of India on June 26, 2013 for a license to commence ba
nking business in terms of section 22 of the Banking Companies Act, 1949.It is p
roposed to do this by converting its subsidiary Bajaj Finance Ltd.into a Bank in
terms of RBI Guidelines for Licensing of New Bank in the Private Sector dated F
ebruary 22, 2013. 2.5: Other Relavant Information About The Organization: SWOT A
nalysis Of The Organization:
Strenths:
Proper setup for customer handling with less work disruption
Widespread distribution network
High performance across categories
Good team back up support
Great financial support network
More schemes than competitors
Figure No.2.4:Strenths of the Organization
25

Weakness :
Uneven schemes to customer One sales executive fails to entertain the customer
Weakness
More strict policy than competitors
Figure No.2.5: Weakness of the Organization Opportunities :
Untapped market above other lending companies
The growing and improved schemes in the market
Opportunities Proposing to launch more other financial schemes more product intr
oduction
Growing demand for 0% financial schemes especially in emerging market
Figure No.2.6: Opportunitiesof the Organization
26

Threats :
The competitions catches-up any new innovation in no time
Threats
Margins getting squeezed from both the directions (price as well as cost)
Threat of other financial lenders like future finance etc offering the same bene
fits
Figure No.2.7: Threats of the Organization 2.6: Awards:
Top 3 Financial Services
Company: We re proud to be ranked amongst the Top 3 Financial Services Companie
s to work for in India. The ranking was conferred on us by Great Places to Work
(GPTW), the gold standard in ranking the worlds best workplaces, at a special eve
nt hosted in Mumbai on 21 June, 2013. GPTW conducts this survey every year among
st more than 500 companies across India. This year more than 530 companies parti
cipated in the survey.
CIO 100: Recently, we also won the CIO 100 Innovation awa
rd for two of our innovations - EMI Card and Flexi saver.CIO 100 is an annual aw
ard program that recognizes organizations that exemplify the highest level of op
erational and strategic excellence in information technology
(IT). CIO magazine has a long and proud tradition of honoring leading companies
for business and technology leadership and innovations through its premiere awar
d program CIO100. Now in its 25th year in the USA, it is an acknowledged mark of
enterprise IT excellence. Its a celebration of 100 organizations (and the people
within them) that are using information technology in innovative ways to delive
r business value, whether by creating competitive advantage, optimizing business
processes, enabling growth or improving relationships with
27

customers. Hosted in countries such as Canada, Sweden, Australia, Singapore, Vie

tnam, Hungary and India, the CIO 100 Awards is a truly global recognition. It is
an acknowledged mark of excellence in enterprise IT.
28

CHAPTER- III RESEARCH DESIGN AND METHODOLOGY

29

3.1: Introduction:
Research is common parlance refers to a search for knowledge. One cans also defi
ne research As scientific and systematic search pertinent information on a specif
y topic. In fact research is an art of scientific investigation. Another meaning
of research as A careful investigation or inquiry especially through for new fact
s in any branch of knowledge.The system of collecting and processing of data for
research project is known as research methodology. Some important factors in res
earch methodology include validity of research data, ethics, reliability of meas
ures and logical sequence. Research is an organized systematic data based scienti
fic inquiry or investigation into a specific problem under taken with the purpos
e of finding answer or solution to it Research is basically a human activity enga
ged in intellectual pursuit of discovering something new. It could be a product,
a method, a service, a system etc. It could also be in abstract forms like idea
, thinking process, strategy etc.
3.2: Meaning of Research:
Research is discovery of facts, development of facts and verification of facts.
Research is an endeavor to discover intellectual and practical solutions to the
problems through the applications of scientific methods to the knowledge univers
e. Research is the last resort when individuals, organizations and societies fac
e some problems for which there are no answers or when there is inconsistence am
ong answers.
Research is carried out to settle controversies, contradictions, mi
sunderstandings and disputes about the nature of some aspects of the universe.
R
esearch is the systematic approach concerning generalization and formulation of
a theory.
3.3: Definitions:
Advanced Learners Dictionary of Current English (OXFORD): Research defined as a ca
reful investigation or inquiry specially though search for new facts in any bran
ch of knowledge.
30

Clifford Woody: Research is defined as the process which includes defining and re
defining problems, formulating hypothesis or suggested solutions, collecting, or
ganizing and evaluating data, reaching conclusions and at last careful testing t
he conclusions to determine whether they fit for the formulating hypothesis Kerli
nger: Research is systematic, controlled, commercial and critical investigation o
f hypothetical propositions about the presumed relations among natural phenomeno
n P. V. Young: Research may be defined as a method of studying , analyzing and con
ceptualizing social life in order to extent modify, correct or verify knowledge
whether that knowledge aids is construction of theory or in practice of an arts.
Black and Champion: Scientific research concerns itself with obtaining informatio
n through empirical observation that can be used to systematically develop logic
ally relate propositions so as to attempt to establish casual relationships amon
g variables
3.4: Characteristics of Research:
1. Predictions of future occurrences. 2. Directions towards to solution. 3. Accu
racy in observation and description. 4. Basis of research is experience. 5. Gath
ering of new data. 6. Research is scientific programme. 7. Generalizations of pr
inciples of theories. 8. Quest for answer. 9. Patient activity. 10. Social relev
ance. 11. Objective and logical
31

12. Careful designed procedure. 13. Needs expertise. 14. Task to discover, devel
op and verify knowledge 15. Careful critical inquiry.
3.5: Types of Research:
1. Pure or Basic or Fundamental Research. 2. Applied Research. 3. Formulative or
Exploratory Research. 4. Descriptive Research or Diagnostic Research. 5. Histor
ical Research. 6. Quantitative or Qualitative Research. 7. Conceptual Research.
8. Empirical or Experimental Research. Other types of Research: 1. One Time Rese
arch or Longitudinal Research. 2. Field setting Research or Laboratory Research
or situational research. 3. Conclusion oriented or decision oriented Research.
3.6: Research Design:
Research design is a plan of action, a plan for collecting and analyzing data in
an economic, efficient and relevant manner. Types of Research Design 1. Explora
tory Research Design. 2. Descriptive Research Design. 3. Experimental Research D
esign
32

Exploratory Research: Exploratory research is conducted to provide a better unde

rstanding of a situation. It isnt designed to come up with final answers or decis
ions. Through exploratory research, researchers hope to produce hypotheses about
what is going on in a situation.
Descriptive Research : Descriptive research can be used to accomplish a wide var
iety of research objectives. However, descriptive data become useful for solving
problems only when the process is guided by one or more specific research probl
ems, much thought and effort, and quite often exploratory research to clarify th
e problem and develop hypotheses.

Experimental Research: The experiment is a situation in which a researcher attem

pts to objectively observe phenomena which are made to occur in a strictly contr
olled situation where one or more variables are varied and the others are held c
onstant.
3.7: Sources of Data:
The study is exploratory in nature, makes use of mainly secondary data. The data
been collected from
The annual reports of the company
Books
Articles
Magazines
Company website Research papers
MBA projects Internet
33

3.8: Objective of Project:

1. To study the different financial schemes of Bajaj Finserv. 2. To study the lo
an procedure for durable product at Bajaj Finserv with the help of case studies
3. To study the surrogate of the Bajaj Finserv.
3.9: Scope of the Project:
This project is limited to Bajaj Finserv Lending of Pune. And the researcher ana
lyses only consumer finance.
3.10: Research Methodology:
The study is exploratory in nature, makes use of mainly secondary data. The data
has been collected from the annual reports of the company, Books, Articles, Mag
azines, Company website, Research papers, MBA projects, Internet etc.
3.10.1: Time Frame:
Due to restricted period of time i.e.3 month, I have collected 5 case studies in
which 4 are success and 1 is rejected.
3.10.2: Analysis of Data:
The researcher analyses the data with the help of Case Studies, Percentage, Tabl
es, and Graphs.
3.11: Limitation of the project:
1. The study is restricted to the consumer durable loan only. 2. Sometimes custo
mer gets dissatisfied due to the restricted policies of EMI procedure.
3.12: Key concepts:
Lending: A person or organization that makes a loan. That is, a lender gives mon
ey to a borrower with the expectation of repayment in a timely manner, almost al
ways with interest.
Surrogates: A surrogate means document requirement criteria
for loan approval process.
34

Bajaj Dedupe: Bajaj Dedupe means there is problem occurred in the previous Bajaj
loan.
Scheme Chart:
Various types of schemes are given below: Table No.3.1: Scheme Chart for loan ap
proval : Schemes 12/4 Description It means the 4months payment will be taken as
an advance and remaining payment will be distributed in 8 months. 10/2 It means
the 2 months payment will be taken as an advance and remaining payment will be d
istributed in 8 months. 18/6 It means the 6 months payment will be taken as an a
dvance and remaining payment will be distributed in 12 months. And it is long te
rm scheme. 24/6 It means the 6 months payment will be taken as an advance and re
maining payment will be distributed in 18 months. And it also long term scheme.
10/0 It means there is no any advance payment will be taken, all payment will be
distributed in 10 months.
35

CHAPTER- IV ANALYSIS AND INTERPRETATION DATA

36

Table: 4.1: Gross Loan Deployment of Bajaj Finserv:

(In crores) Deployment FY 2009-10 Consumer Finance
Consumer durable Two and Three wheelers Total-1
FY 2010-11
FY 2011-12
FY 2012-13
1037 1364 2401
2262 2034 4296
3576 2671 6247
4971 3713 8684
SME Finance
Mortgage Small Business Loans Other assets Total-2
1067 803 165 1870
1672 803 389 2864
2985 899 527 4411
4447 1035 785 6267
Commercial Lending
Vendor Financing Construction Equipment Total-3 Grand Total (1+2+3)
149 149 4420
1346 694 2040 9200
2480 891 3371 14029
3249 1167 4416 19367
37

Gross Loan Deployment

5 4.5 4 3.5 3 2.5 2 1.5 1 0.5 0 FY 2009-10 FY 2010-11 FY 2011-12 FY 2012-13
Consumer Finance
SME Finance
Commercial Lending
Figure No.4.1. Gross Loan Deployment of Bajaj Finserv
Interpretation:
The above graph shows loan deployment of the year, as per the sectors, the growt
h of the consumer finance sector is more rapidly as compared to the other SME fi
nance and commercial lending sector. 4.1 CASE STUDY: Case No.1 Name of the Appli
cant Age Permanent Address Mr. Ranjeet Kumar 35 year Mahatma Gandhi Road Nehru N
agar, Near Rajouri Garden New Delhi-110021 Residential Address Gulmohar Park, IT
I Road near ICICI Bank, Aundh Pune -411007 Occupation Service
38

Company Name Salary Purchase of Products

SunGard, pune 80,000/-PM
I. II. Cost of Products I. II. Document Required for Loan I.
Samsung LED TV Samsung Washing Machine
Rs.40,000 Rs.35,000
Address Proof:-Bank Statement
II.
ID Proof: - Pan Card or Voting Card or Driving License.
III. Problem
Income Proof:-SBI Credit Card (Platinum) Address Proof
Mr.Ranjeet Kumar has the address proof but this Address Proof of other city, so
as per loan requirement address proof should be of current city
Name of the Applicant - Mr.Ranjeet Kumar
Table No.4.2 Case Study 1 Particular Eligibility approval Occupation Company Nam
e Salary Service SunGard Rs.9,60,000 PA
criteria
for
loan
Applicable for Loan
39

House Place(Stay) Document Required Address Proof ID Proof Credit Card Products
Samsung 40 LED TV Samsung Machine
Rented Aundh

Bank Statement PAN Card ,Voting Card SBI Credit Card (Platinum)

Rs.40,000

Washing Rs.35,000
Solution:a. Calculation of EMI and Down payment: Scheme-:12/4 (Ref.Table No.3.1)
Cost of Product-: Rs.75, 000 Down payment -:Rs.25, 000 (Rs.75, 000/12*4) EMI-:
Rs.6250*8 Month= Rs.50, 000
b. How to Approve the Loan: I. Minimum Required Salary for taken a loan Rs.8000/and Above, So Mr.Ranjeet Kumar has Rs.80000/-PM Salary so he is applicable for l
oan. II. As an address proof for taken a loan it is must to Mr.Ranjeet Kumar to
submit either Rent agreement or credit card statement which is on current city a
ddress.
III.
As an ID proof requirement he should be provide voting card or PAN Card or Passp
ort.
40

Case No.2 Name of the Applicant Age Residential Address Ms.Smita Badiyani 26 yea
r Bramha Village, Behind Jyoti Restaurant, near Bharat Petrol pump, Kondhwa Pune
-411048 Occupation Company Name Salary Purchase of Products I. Cost of Products
I. Rs.36,000 LG Refrigerator Service Infosys, Pune 50,000/-PM
Document Required for Loan I. II. Address Proof:-Rent Agreements ID Proof: - Pan
Card or Voting Card or Driving License. And marriage Certificate. III. Income P
roof:-3 Month Bank Statement.
Problem
ID Proof
As per the documents require for the approval of loan, Ms.Smita Badiyani should
submit the ID Proof of shes current name.
Name of the applicant - Ms.Smita Badiyani
41

Table No.4.3: Case Study 2 Particular Eligibility criteria for loan approval Occ
upation Company Name Salary House Place Document Required Address Proof ID Proof
Bank Statement Product LG Refrigerator Rs.36,000
Applicable for Loan
Service Infosys Rs.6,00,000 PA Rented Kondhwa
Rent Agreement Marriage Certificate 3 Month bank statement

Solution: a. Calculation of EMI and Down payment: Scheme-:12/4(Ref.Table No.3.1)

Cost of product-:Rs.36, 000 Down payment-: Rs.12, 000 (Rs.36, 000/12*4) EMI-: R
s.3000*8 Month = Rs.24, 000
b. How to approve the Loan: I. She has the 50,000 PM salary; the minimum salary
should be 8000 PM, so she is applicable for the loan. II. As per the requirement
of loan approval document, if lender leaves on the Rent bases then he or she sh
ould submit the Rent agreement which would be on Rs.1000/- stamp paper. This doc
ument criteria fulfilled by Ms.Smita Badiyani. III. For the ID Proof required th
e PAN Card, Voting Card and Driving Licenses.
42

Ms. Badiyani has the PAN Card but problem is that shes is not having the current
name i.e. after marriage on the PAN Card. For solving this problem, we have take
n the Marriage Certificate along with PAN Card Copy. IV. For the Income Proof re
quired Credit Card, or Existing Customer or any bank loan as well as 3 Month Ban
k Statement, So she have the 3 Month Bank Statement from Feb to May, and also he
r 780 score in CIBIL records. Case No.3 Name of the Applicant Age Residential Ad
dress Mr.Anurag Kasat 45year Shree Niwas, ITI Road, near Croma Showroom,aundh Pu
ne -411007 Occupation Company Name Salary Purchase of Products I. Cost of Produc
ts I. Rs.52,000 Sony LED TV Service Mahindra and Mahindra 50,000/-PM
Document Required for Loan I. Address Proof:-Electricity Bill, Telephone Bill, P
assport II. ID Proof: - Pan Card or Voting Card or Driving License or Passport I
II. Income Proof:-HDFC Credit
Problem
System Error
43

Mr. Anurag Kasat has all the required documents but the actual problem in system
, the system shows the Bajaj Dedupe Error it means there is problem in the loan
database of Bajaj Finserv lending. Name of the applicant:-Mr.Anurag Kasat (Exist
ing Customer) Table No.4.4: Case Study 3 Particular Eligibility criteria for loa
n approval Occupation Company Name Salary House Place Document Required Address
Proof ID Proof Credit Card Product Sony LED Rs.52,000
Passport Passport HDFC Ban
k
Service Mahindra and Mahindra Rs.6,00,000 PA Own Aundh
Applicable for Loan
Solution:a. Calculation of EMI and Down payment: Scheme: 10/0 (Ref.Table No.3.1)
Cost of product: Rs.52, 000 Down Payment: Rs.250 (Processing Fess) EMI: Rs.5200
*10 Month=Rs.52, 000
44

b. How to approve the loan: I. Mr.Anurag Kasat has the Existing Customer of Baja
j Finserv Lending, for the Existing Customer can pay the down payment through ca
sh as well as credit or Debit Card. So Mr.Kasat pays the down payment by cash. I
I. Due to the system Error the loan has been rejected, When the Mr.Kasat has pro
duced the copy of NOC to the Bajaj Finserv Lending. Then the Company sorts out h
is problem by updating the previous loan history of Mr.Kasat. III. For reflectin
g the database changes system required the duration of one month so after reflec
ting the changes his loan get approved. Case No.4 Name of the Applicant Age Resi
dential Address Mr.Akshay Kadam 27 year Swapnagari society, ajmera Near H.A.Grou
nd Pimpri, Pune -411018 Occupation Company Name Salary Purchase of Products I. I
I. Cost of Products I. II. Rs.42,000 Rs.30,000 Sony LED TV Samsung Washing Machi
ne Service Alfa Laval 30,000/-PM
45

Document Required for Loan I. Address Proof:-Electricity Bill, Telephone Bill, P

assport II. ID Proof: - Pan Card or Voting Card or Driving License or Passport I
II. Problem Income Proof:-ICICI Bank Credit Card
ID Proof Name
Name of Mr.Akshay kadam on the credit card and Pan Card is mismatch i.e.Akshay K
adam on credit card and AAkaash KKadam on PAN Card. Name of the applicant:-Mr.Ak
shay Kadam Table No.4.5: Case Study 4 Particular Eligibility criteria for loan a
pproval Occupation Company Name Salary House Place Document Required Address Pro
of ID Proof Credit Card Product Sony LED Samsung washing Machine Rs.42,000 Rs.30
,000
Applicable for Loan
Service Alfa Laval Rs.3,60,000 PA Own Pimpri
Electricity Bill Pan Card ICICI Bank
46

Solution:a) Calculation of EMI and Down payment:

Particular Scheme Cost of product Down Payment EMI
Sony 18/4 Rs.42,000 Rs.9,336 (Rs.42,000/18*4) Rs.2,334*14 Month=Rs.32,676
Samsung 12/4 Rs.30,000 Rs.10,000(Rs.30,000/12*4) Rs.2,500*8 Month=Rs.20,000
b) How to approve the Loan: I. Mr.Akshay Kadam has the entire document i.e. Addr
ess Proof, ID Proof, and Income Proof, but he is only having the problem with ID
Proof. II. For solving the ID Proof problem we have taken the Govt.Gadget Lette
r from him.
Case No.5 Name of the Applicant Age Permanent Address Mr. Avinash Thite 50 years
Karve Road, near Dashabhuja Ganesh Temple, Kothrud Pune-411004 Occupation Compa
ny Name Purchase of Products I. II. Cost of Products I. II. Rs.52,000 Rs.35,000
Sony LED TV Sony Home Theater Own Business Omkar Trading
47

Document Required for Loan I. II. III. Problem Address Proof:-Electricity Bill,
Index-II, Telephone Bill. ID Proof: - Pan Card, Voting Card, Driving License. an
d Passport. Income Proof: - Credit Card, Any Bank Loan. Case rejected due to les
s CIBIL Score
CIBIL Scores Required Criteria:Minimum CIBIL Score required for loan approval is
750 or more; Mr.Avinash Thite has 710 CIBIL Score, His score below the criteria
so loan has been rejected.
4.2: PROCESS ADOPTED:
Documentation: 1. Residential proof 2. ID Proof 3. Cancelled Cheque 4. Credit Ca
rd 5. Salary Slip Latest (For Govt. Employee and salaried) 6. Last 3 months Bank
Statement (Salaried) 7. Phone Bill, latest, original and delivered by courier (
Instant) 4.2.1: Application process for loan approval:
First pitch the customer,
after pitching the customer the next process is to explore them overall loan pro
cess of 0% interest sceheme .Once the customer is agreed, then ask the customer
for the required documents like ID-proof, Address proof i.e voter ID,driving lic
ence,aadhar card and cancelled cheque etc to approve the loan.After compliting t
he submition procedure of documentation,the next step is to decide the surrogate
of the customer.
48

Customer should be fill up the application form,then the details of customer get
stored by the executives in to the sales force softwear.
Once all this loan pro
cess is done, the unique case ID will be generates. Then all the control goes in
to the hand of company approval department. After approval of loan , customer s
hould sign the agreement document (which includes the terms and conditions), the
n next process is to generate the invoice of loan and product amount.
On the bas
is of invoice,memo of disbursement is gets generate. Along with the loan procedu
re documents, disbursment memo will get forward to the bajaj finserv , Pune bran
ch office premises. Then all the attached documents are scrutinze by the operati
onal department of bajaj finservs.
Once the loan procedure of the company is sati
sfied then this douments get sealed by the approval stamp.
49

50

Figure No. 4.2 Flow chart of the application process for loan approval
4.2.2: Surrogates Required for Loan Approval:
There are three types policy are as below: A.WOW Policy B.WOW Lite Policy C.WOW
Extension Policy
51

A.WOW Policy: WOW Policy mostly used for those customer who are in the listed co
mpanies, have the credit card, as per the rule of company the maximum Loan to Va
lue(LTV) 83% to 90% it depend on the customer document. Following are the Surrog
ates included in that Policy: 2.1 Credit Card (Max LTV 83% up to 125000) 2.2 Lis
ted Companies (Max LTV 90% up to 100000) 2.3 RC of Vehicle (Max LTV 83%) 2.5 Exi
sting Customer (Max LTV 90% up to 50000) 2.6 CIBIL Score (Max LTV 90% up to 1250
00) 2.7 Salaried (Max LTV 90% up to 125000) 2.11 Instant B.WOW Lite Policy: WOW
Lite Policy used for those customers whose net exposure is up to25000 to 35000.a
nd as per the company rules the maximum Loan to Value (LTV) is 83% for all surro
gates. Following are the Surrogates included in that Policy: 3.1 Credit Card (Ma
x LTV 83% up to 35000) 3.2 Listed Companies (Max LTV 83% min salary 7500) 3.3 RC
of Vehicle (Max LTV 83% up to 25000) 3.5 Existing Customer (Max LTV 83%) 3.6 CI
BIL Score (Max LTV 83%) 3.7 Salaried (Max LTV 90% Min net salary 7500)
52

Figure No. 4.3 Surrogates Required for Loan Approval

53

CHAPTER-V FINDINGS
54

While paying through credit card, that much amount is blocked from the card. As
there is monthly limit in each card, so it is wise to go for Bajaj Finserv Lendi
ng.
Bajaj Finserv Lending provided loan on consumer durable product to the custo
mer as per the surrogates.
Flexible EMI scheme in many products are available. B
ajaj Finserv Lending provides many schemes such as 12/4, 10/2, 18/6, 24/6 etc. C
ustomer can choose any EMI Scheme option according to their paying capability.
A
s per the requirement of finance company for address proof would be required cur
rent place proof, and for ID proof required the valid name of person it shows wi
th the help of case studies.
55

CHAPTER-VI SUGGESTIONS
56

Suggestions:
There is no awareness about 0% finance scheme to customers. So, Therefore, Bajaj
Finserv should make its customers aware about the 0% finance schemes.
Customers
think that Bajaj Finserv will take some hidden charges from them, if they take
durable loan at 0% from Bajaj Finserv. So the Bajaj Finserv removes the wrong th
inking of customer and to explain in detail loan procedure.
Bajaj Finserv initia
lly have the system of swiping of EMI card but due to some difficulty they stopp
ed it, I think Bajaj should work upon this as this can save more time for custom
er as well as for Sale Executive and he can serve more non-EMI card user and con
vert them into EMI card holder.
57

CHAPTER-VII CONCLUSION
58

Conclusion:
There are many organizations in the world which are providing consumer credit se
rvices which are helpful for the financial stability. Financial stability is ver
y important not only for the businesses but also for the consumers. The business
es as well as the consumers need the stability regarding the financial matters b
ecause without the stability no one could be very innovative in the longer run.
59

CHAPTER-VIII BIBLIOGRAPHY
60

Performa of Bibliography:
Book:
Kulkarni M.V., (2010), Research methodology, Everest publishing house. Sri
vastava T.N., (2011), Business research methodology, Tata McGraw - Hill Educatio
n private limited. Online References:
WWW.Bajajfinservlending.in WWW.Slideshare.com WWW.Salesforce.com

News Paper:
61

Economic Times Times of India

ANNEXURE:
Process of Granting Loan:
1. Documentation- Documentation like Credit card, driving license, PAN card, etc
. is required to provide loan to the customers. 2.. Various requirements- As men
tioned in surrogates various slabs are there according to which customers are pr
ovided loan.
Application Form for EMI Card
62

Loan Term Sheet

63

Application Form for Consumer Finance

64

Electronic Clearing Form (ECS)

65