CMS Report 1

Project on:
The Cash Management Services Market in India
Presented to:
ICICI Bank
&
N. L. Dalmia Institute of Management Studies and
Research
Presented By:
Kamal Purohit
P.G.D.B.M
Batch: 2009-11
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DECLARATION
I, Kamal Purohit, student of N. L. Dalmia Institute of Management Studies &
Research, studying MMS Course hereby declare that I have completed the
project on “The Cash Management Services Market in India” in the academic
year 2009-2010. The information submitted is true and original to the best of
my knowledge.
SIGNATURE
__________________
ACKNOWLEDGEMENT
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It gives me immense pleasure to thank the people who have guided me throughout
my project. I am not sure if I will ever be able to repay them for all their invaluable support,
time and guidance. My project bears the imprint of many people.
I take this opportunity to express my deep and sincere gratitude to Mr. Amar Doshi, Product
Manager, CMS, ICICI Bank for his timely support. It is because of his support that I could
synchronize the efforts in converting the manifold features of the project. I would also like to
thank Mr. Praveen Trivedi, DGM, ICICI BANK for selecting me to complete a project in his
department.
I would also like to express my sincere gratitude towards Prof P. L. Arya (Director, N. L.
Dalmia Institute of Management Studies & Research) for his support and guidance.
Finally I am thankful to all the employees of ICICI Bank, who have given their full support in
collecting the required information and continuous help during the preparation of the
project.
I thank you all!!
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TABLE OF CONTENTS
TOPIC Page no.
1. Executive Summary 5
2. Introduction to Cash Management Services 6
3. Benefits of Cash Management 7
4. Cash Management Services generally offered 8
5. Cash Management Services- Indian Scenario 11
6. Industry Analysis and target segments 13
7. Cash Management Services at ICICI Bank 22
8. Product Analysis 26
9. Competitive Analysis 28
10. SWOT Analysis 67
11. Analysis of Cheque Clearing 68
12. Questionnaire Design 73
13. Survey Report 83
14. Conclusion 99
15. Recommendations 100
Executive Summary
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Cash management is a broad term that covers a number of functions that help individuals and
businesses process receipts and payments in an organized and efficient manner.
Administering cash assets today often makes use of a number of automated support services
offered by banks and other financial institutions. The gamut of cash management services
range from simple checkbook balancing and other types of securities to automated software
that allows easy cash collection.
When it comes to cash collections, there are a few popular options today that can make the
process of receiving payments from customers much easier. Automated clearing houses make
it possible to transact a business to business cash transfer that deducts the payment from the
customer account and deposits the funds in the vendor account. Generally, this service is
available for a fee at local banks.
Lockbox services are also often used by businesses to speed up the Accounts
Receivable process. Cash management by lockbox requires the establishment of a post office
box for the client. The vendor uses this post office address as the remittance address on
all invoices. As payments are received, the financial institution collects the payments, posts
them to the operating account for the customer. The customer can usually access daily reports
that can be downloaded and used for posting payments into the company Receivables.
Because of the increased incidence of check fraud, the concept of account reconcilement
services has become a must for many companies. Essentially, an ARC will keep the
checkbook for an operating account balanced at all times. As an additional level of protection,
the ARC allows the client to upload a daily listing of checks that have been issued on the
account. In the event a check is presented that is not included on the authorized lists, the bank
will reject the check.
There are a number of cash management options offered by local banks. In some instances,
the cost for the services can be costly. However, many businesses find that the savings in time
coupled with the high degree of accuracy more than make up for the charges associated with
cash management support services. The project aims to understand the Cash Management
Services offered by the banks. It also tries to understand the Cash Management Services
market in India, the need of customers and the current status of CMS products in the Indian
market. The objective of the report is to get a thorough understanding of the process of CMS
and how the market functions. It also tries to identify growth opportunities for the market by
trying to understand the needs of the customers using CMS
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Introduction to Cash Management Services
Manage your cash flow and liquidity-Effectively and Efficiently
For any organization, cash is the lifeblood that keeps the business going. That is why,
increasingly, Cash Management has been gaining importance with organizations that
view the services as a crucial part of their corporate strategies.
Cash Management is Efficient Management of cash (Outflows/Inflows) to improve liquidity

and returns while implementing adequate control and managing risks. Cash Management can
generally be defined as the efficient utilization of cash through coordinated management of
payments, collections and cash balances. The objectives are to reduce costs, enhance control
and optimize returns as well as reduce the inventory holdings. Traditionally, cash
management involved personalized services offered by the bank's staff to the company's
treasurer via mails, telephone, calls, faxes etc or visits to the bank initiated transactions. But
with the advent of computer technology, cash management services have been automated to a
large extent. Many banks now allow their corporate customers to perform online inquiries and
transaction services (payment, collection and liquidity management) through PC or Internet
via a web interface. With such a system in place, a company can perform most of the cash
management functions themselves without relying on a bank staff to act as the executor of
their requests.
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Benefits of Cash Management Services
1. Properly timing the disbursements.
Some payments must be made on a specified or legal date, such as Social Security payments.
For such payments, there is no cash management decision. For other payments, such as
vendor payments, discretion in timing is possible. Government vendors face the same cash
management needs as the Government. They want to accelerate collections. One way vendors
can do this is to offer discount terms for timely payment for goods sold.
2. Eliminating idle cash balances.
Every Rupee held as cash rather than used to augment revenues or decrease expenditures
represents a lost opportunity. Funds that are not needed to cover expected transactions can be
used to buy back outstanding debt (and cease a flow of funds out of the Treasury for interest
payments) or can be invested to generate a flow of funds into the Treasury’s account.
Minimizing idle cash balances requires accurate information about expected receipts and
likely disbursements.
3. Ensuring timely deposit of collections.
Having funds in-hand is better than having accounts receivable. The cash is easier to convert
immediately into value or goods. A receivable, an item to be converted in the future, often is
subject to a transaction delay or a depreciation of value. Once funds are due to the
Government, they should be converted to cash-in-hand immediately and deposited in the
Treasury's account as soon as possible.
4. Monitoring exposure and reducing risks
The Banks have the responsibility to use timely, reliable, and comprehensive financial
information and systems. To that end, banks encourage to improve their cash management
practices by using electronic funds transfer (EFT) whenever cost effective, practicable, and
consistent with statutory authority. So there is a need to monitor the exposure and reduce the
risk.
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Cash Management Services generally offered
The following is a list of services generally offered by banks and utilized by larger businesses
and corporations
1. Account Reconcilement Services: Balancing a checkbook can be a difficult process

for a very large business, since it issues so many checks it can take a lot of human
monitoring to understand which checks have not cleared and therefore what the
company's true balance is. To address this, banks have developed a system which
allows companies to upload a list of all the checks that they issue on a daily basis, so
that at the end of the month the bank statement will show not only which checks have
cleared, but also which have not. More recently, banks have used this system to
prevent checks from being fraudulently cashed if they are not on the list, a process
known as positive pay.
2. Advanced Web Services: Most banks have an Internet-based system which is more
advanced than the one available to consumers. This enables managers to create and
authorize special internal logon credentials, allowing employees to send wires and
access other cash management features normally not found on the consumer web site.
3. Armored Car Services: Large retailers who collect a great deal of cash may have the
bank pick this cash up via an armored car company, instead of asking its employees to
deposit the cash.
4. Automated Clearing House: services are usually offered by the cash management
division of a bank. The Automated Clearing House is an electronic system used to
transfer funds between banks. Companies use this to pay others, especially employees
(this is how direct deposit works). Certain companies also use it to collect funds from
customers (this is generally how automatic payment plans work). This system is
criticized by some consumer advocacy groups, because under this system banks
assume that the company initiating the debit is correct until proven otherwise.
5. Balance Reporting Services: Corporate clients who actively manage their cash
balances usually subscribe to secure web-based reporting of their account and
transaction information at their lead bank. These sophisticated compilations of
banking activity may include balances in foreign currencies, as well as those at other
banks. They include information on cash positions as well as 'float' (e.g., checks in the
process of collection). Finally, they offer transaction-specific details on all forms of
payment activity, including deposits, checks, and wire transfers in and out, ACH
(automated clearinghouse debits and credits), investments, etc.
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6. Cash Concentration Services: Large or national chain retailers often are in areas
where their primary bank does not have branches. Therefore, they open bank accounts
at various local banks in the area. To prevent funds in these accounts from being idle
and not earning sufficient interest, many of these companies have an agreement set
with their primary bank, whereby their primary bank uses the Automated Clearing
House to electronically "pull" the money from these banks into a single interest-
bearing bank account.
7. Lockbox services: Often companies (such as utilities) which receive a large number
of payments via checks in the mail have the bank set up a post office box for them,
open their mail, and deposit any checks found. This is referred to as a "lockbox"
service.
8. Positive Pay: Positive pay is a service whereby the company electronically shares its
check register of all written checks with the bank. The bank therefore will only pay
checks listed in that register, with exactly the same specifications as listed in the
register (amount, payee, serial number, etc.). This system dramatically reduces check
fraud.
9. Sweep Accounts: They are typically offered by the cash management division of a
bank. Under this system, excess funds from a company's bank accounts are
automatically moved into a money market mutual fund overnight, and then moved
back the next morning. This allows them to earn interest overnight. This is the
primary use of money market mutual funds.
10. Zero Balance Accounting: It can be thought of as somewhat of a hack. Companies

with large numbers of stores or locations can very often be confused if all those stores
are depositing into a single bank account. Traditionally, it would be impossible to
know which deposits were from which stores without seeking to view images of those
deposits. To help correct this problem, banks developed a system where each store is
given their own bank account, but all the money deposited into the individual store
accounts are automatically moved or swept into the company's main bank account.
This allows the company to look at individual statements for each store. U.S. banks
are almost all converting their systems so that companies can tell which store made a
particular deposit, even if these deposits are all deposited into a single account.
Therefore, zero balance accounting is being used less frequently.
11. Wire Transfer: A wire transfer is an electronic transfer of funds. Wire transfers can
be done by a simple bank account transfer, or by a transfer of cash at a cash office.
Bank wire transfers are often the most expedient method for transferring funds
between bank accounts. A bank wire transfer is a message to the receiving bank
requesting them to effect payment in accordance with the instructions given. The
message also includes settlement instructions. The actual wire transfer itself is
virtually instantaneous, requiring no longer for transmission than a telephone call.
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12. Controlled Disbursement: This is another product offered by banks under Cash
Management Services. The bank provides a daily report, typically early in the day,
that provides the amount of disbursements that will be charged to the customer's
account. This early knowledge of daily funds requirement allows the customer to
invest any surplus in intraday investment opportunities, typically money market
investments. This is different from delayed disbursements, where payments are issued
through a remote branch of a bank and customer is able to delay the payment due to
increased float time.
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Cash Management Services - Indian Scenario
The need for cash management aroused two decades ago in the mid eighties when the Indian
corporates were facing various problems like the uncertainty as to when funds would be made
available to them, the problem of long transit period between banking cheques and receiving
funds, long period of administrative work in banking cheques and tracking progress and
reconciliation problems regarding uncertainty of inflows and lack of details on each credit to
the account. It is important to review the Indian scenario in this regard. As we are all aware,
that the banks’ desire for funds has lost because of the slowdown. Despite the offer of very
soft terms corporates are refusing to borrow, while bank deposits have been ballooning.
Compelled to service the burgeoning liabilities, but unable to lend hastily and allow their
non-performing assets (NPAs) to grow, bankers are forced to compete for the handful of safe
bets among their borrowers.
Banks chose to use the opportunity to refocus their activities, seeking clearly defined
identities in terms of services and customer segments. Most of them concentrated on cleaning
up their books by peeling down their NPAs. All of them are attempting for freezing of costs,
improving operational efficiencies, and boosting productivity. The strategy of the banks,
which are performing well, is to use fee-based services to maintain their earnings growth.
With interest rates falling, non-interest income is, unsurprisingly, the fastest-growing
component of the banks’ total income. Fee-based activities will complement though not
substitute the core business of lending. With rising interest rates too, Corporate and others are
not willing to borrow, fee-based services play again an active role in boosting a Bank’s total
income.
It is gratifying to note that a number of banks in India are offering wide-ranging cash
management services to their corporate clients. All the three categories of banks viz.,
nationalized banks, private banks, and foreign banks operating in India are active in the cash
management segment. SBI, PNB, Corporation, ICICI Bank, HDFC Bank, Centurion Bank of
Punjab and ING Vysya Bank, are some of the active Indian banks in this segment. Citi Bank,
Standard Chartered Bank, ABN Amro Bank, BNP Paribus, and HSBC are the foreign banks
operating in India, which are prominent among the cash management services providers.
Indian banks are offering services like electronic funds transfer services, provision of cash
related MIS reports, cash pooling services, collection services, debit transfer services,
guaranteed credit arrangements, sweep products, tax payment services, receivables and
payables management.
Foreign banks operating in India are offering regional and global treasury management
services, liquidity management services, card services, electronic banking services,
ecommerce solutions, account management services, collection management services, cash
delivery management services and investment solutions. Banks realized that if they do not
offer the services required by corporate customers it would result in a net loss of clientele,
returns and goodwill. Banks in India need to continuously monitor international trends in
innovations taking place in providing cash management services and swiftly offer similar
services to their corporate clients. The Reserve Bank of India is taking a number of
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initiatives, which has facilitated the active involvement of commercial banks in the
sophisticated cash management segment. One of the prerequisites is to ensure faster and
reliable mobility of funds in a country and to have an efficient payment system. Considering
the importance of a robust payment system to the economy, the RBI has been taking
numerous measures since mid Eighties to strengthen the payments mechanism in the country.
Introduction of computerized settlement of clearing transactions, use of Magnetic Ink
Character Recognition technology, provision of inter-city clearing facilities and high value
clearing facilities, Electronic Clearing Service Scheme , Electronic Funds Transfer scheme,
Delivery vs. Payment for Government securities transactions, setting up of Indian Financial
Network are some of the significant initiatives which highlight the seriousness with which the
Reserve Bank has taken up the reforms in Payment systems.
Introduction of a Centralized Funds Management System, Securities Services System, Real

Time Gross Settlement System and Structured Financial Messaging System are on the top
priority items of the agenda to transform the existing systems into a state-of-the-art payment
infrastructure in India by the Reserve Bank. The current vision envisaged for the payment
systems reforms is one, which contemplates linking up of at least all important bank branches
with the domestic payment systems network thereby facilitating cross border connectivity.
With the help of the systems already put in place in India and which are coming into being,
both banks and corporate can exercise effective control over the cash management.
Industry Analysis and Target Segments

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Cash Management Services (CMS) is required across different industries and every industry
has its own specific Cash Management need. Ten different industry segments were chosen
and analyzed on the following factors:
1. Major Players in the Industry
2. Features of the Industry on the whole
3. Need for Cash Management
The industry analyzed and the findings are as shown below:
a. Construction:
The various players in this industry are:
 Larsen & Toubro: Annual turnover of Rs 339263 million
 Punj Llyod: Annual turnover of Rs 68879 million
 JP Associate: Annual turnover of Rs 57641 million
 IVRCL Infra : Annual turnover of Rs 49830 million
 NagarCons : Annual turnover of Rs 41514 million
Features:
 Experiencing growth to due to increase in demand.
 Not too dependent on government policies.
 Has government support as it wants more development.
 Eg: DLF tie up with DDA
 Lot of diversification opportunities possible
 Eg: Unitech investing in hotel construction
 It is a cyclical industry as demand generally depends on the state of the

economy
Cash Management Services need:
 The industry can have Cash Management Services

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 Companies have multiple projects running which makes keeping track of
payments to suppliers difficult
 These companies hire contractors for work. They can be paid using Auto
Clearing services
 These companies have multiple collection issues once the project is

underway. The bank can act as a collector
 CMS can help the companies in delay of supplies due to delay in payments
 CMS can help them have a centralized MIS which the company and the
suppliers can access for better operations
b. Hospitality:
The various players in the industry are:
 IHC Ltd: Annual turnover of Rs 16195 million
 EIH : Annual turnover of Rs 8886 million
 Oberoi Group: Annual turnover of Rs 2147 million
 Hotel Leela Venture: Annual turnover of Rs 4522 million
 Asian Hotels Ltd: Annual turnover of Rs 6415 million
Features:
 The Hospitality industry is witnessing a boom due to increased

international as well as domestic demand
 Not too dependent on government policies.
 Has government support as it is encouraging tourism through various

campaigns
 Price of service is dependent on many factors which make it a price

sensitive industry
 It is a cyclical industry as demand generally depends on the state of the

economy as well as current political situation
 The industry can have Cash Management Services (CMS)
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 Companies have a chain of hotel in different cities. They can have a
centralized payment and collection structure
 For a particular hotel payables can be managed through auto clearing

services
 Receivables from customers can be managed through a concentration

account.
 Every hotel can have a centralized MIS to maintain inventory levels

and stockouts. Also automatic order system can be set up through the bank
 The payments made and received can be maintained using auto

reconcilement services
c. FMCG:
The various players in this industry are:
 HUL Ltd: Annual turnover of Rs 205170 million
 Dabur India: Annual turnover of Rs 23961 million
 Colgate Palmolive: Annual turnover of Rs 16948 million
 Nirma: Annual turnover of Rs 30000 million
 Marico Industries Ltd: Annual turnover of Rs 19174 million
Features:
 A major portion of the monthly budget of each household is reserved

for FMCG products. So there is no problem of demand
 The volume of money circulated in the economy against FMCG products

is very high, as the number of products the consumer use is very high
 Competition in the FMCG sector is very high resulting in high pressure on

margins.
 Manufacturing in the company can be outsourced
 The industry can have Cash Management Services (CMS)
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 As manufacturing is outsourced it important to maintain payables and
receivables
 These companies have a tight working capital policy. CMS can help
them maintain that
 These companies have strong distribution networks. Transactions with

these networks can be maintained by a centralized system
d. Oil and Natural Gas:
 Reliance Industries: Annual turnover of Rs 1418474 million
 BPCL: Annual turnover of Rs 1352377 million
 HPCL: Annual turnover of Rs 1254869 million
 India Oil Corp: Annual turnover of Rs 3070485 million
 ONGC: Annual turnover of Rs 636187 million
Features:
 They provide the basic material for fuel
 They are highly dependent on government policies
 Pricing is subsidized and they bear the brunt of subsidies
 They are one of the most profit making companies in India
 Eg: ONGC
 These companies do not necessarily need CMS
 These companies are owned by the government and are highly regulated
 Their operations is mostly overlooked by the government
e. Aviation:
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 Jet Airways: Annual turnover of Rs 114769 million
 Kingfisher Airlines: Annual turnover of Rs 52691 million
 Spice Jet: Annual turnover of Rs 16894 million
 Global Vectra Helico: Annual turnover of Rs 2000 million
Features;
 It is one of the most rapid growing industry of the 90’s
 It has immense potential for growth
 It is capital intensive industry
 It is dependent on government policies
 It is a cyclical industry as demand depends on the state of the economy
 The aviation companies can have Cash Management Services (CMS)
 It can have a centralized salary disbursement along with other payables
 The company has interest payments on fleet which can be

automatically adjusted by the bank
 The receivables in terms of inventory can be maintained by the bank
f. Retail:
The various players are:
 Future Value Retail: Annual turnover of Rs 66614 million
 Shopper Stop Ltd: Annual turnover of Rs 14000 million
 Trent: Annual turnover of Rs 5140 million
 Vishal Retail: Annual turnover of Rs 13930 million
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Features:
 It is one of the fastest growing industries of the 90’s
 It has immense future potential since the purchasing power of the

customers increase
 Market is supposed to grow to $637 billion by 2015 from $300 billion in

2007
 India is ranked 1st as the most attractive market for retail investments
 The players in the industry have a chain of outlets. Payments and

receivables for the chain can be maintained by a centralized system
 For a particular outlet inventory payments, petty cash payments can be

managed by the bank
 The companies can have auto reconciliation to manage accounts in a

centralized manner
g. Steel:
 SAIL: Annual turnover of Rs 436555 million
 Tata Steel: Annual turnover of Rs 243157 million
 JSW Steel: Annual turnover of Rs 140012 million
 Essar Steel: Annual turnover of Rs 116883 million
Features:
 India is the 5th largest producer of steel
 Steel companies have shown robust growth during the past 5-7 years
 It is a cyclical industry as demand depends on the state of the economy
 It is dependent on government policies
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 The companies can make payments to suppliers through a centralized

payment system
 The company can have a centralized cash and cheque collection from
customers
 Daily inventory purchases and petty cash expenses can also be

managed by a bank
h. IT:
 TCS: Annual turnover of Rs 230444 million
 Infosys: Annual turnover of Rs 211400 million
 Wipro: Annual turnover of Rs 215073 million
 Mah Satyam: Annual turnover of Rs 81372 million
Features:
 Information Technology is the fastest growing sector of India, a sunrise

industry and the area of growth for the millennium
 India's software and services exports were $17.2 billion in the fiscal year
ended March 31 this year, up by 34.5 percent from the previous year
 The engineering, R&D and software products exports segment is expected

to grow by 14.4 per cent in the current fiscal year, to touch US$ 7.3 billion;
which highlights the strong impetus and renewed focus on improving IP
driven service capabilities in India.
 The industry need not necessarily have CMS
 These companies have a lot of intangibles. Thus their payables are less
 These companies generally have their own software package in place for
collection and salary disbursements
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i. Pharmaceuticals:
 Cipla: Annual turnover of Rs 49606 million
 Ranbaxy Labs: Annual turnover of Rs 47802 million
 Dr Reddy’s Labs: Annual turnover of Rs 41589 million
 Sun Pharma: Annual turnover of Rs 38615 million
Features:
 India’s pharmaceutical industry is one of the fastest growing sectors in the

Indian economy with the growth rate (CAGR) of 11.9 per cent during
2004-2008
 The industry has emerged as one of the strongest and most successful
examples of knowledge-based industries in the world and it has made
tremendous progress in terms of development of technology, products and
infrastructure
 The Indian pharmaceutical industry ranks fourth in the world in terms of

volume (8 per cent global share) and fourteenth in terms of value (1.9 per
cent global share).
 The industry can have CMS
 The companies can make payments to the suppliers through a

centralized system
 The receivables can also be managed by such a system
 They can manage all their accounts through account concentration

services
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j. Power:
 NTPC: Annual turnover of Rs 419752 million
 Rel. Infra: Annual turnover of Rs 97394 million
 Tata Power: Annual turnover of Rs 72352 million
 Suzlon Energy: Annual turnover of Rs 72355 million
Features:
 Majority of Generation, Transmission and Distribution capacities are with

either public sector companies or with State Electricity Boards (SEBs)
 Private sector participation is increasing especially in Generation and

Distribution
 The industry has to bear the brunt of unbalanced growth
 The industry need not have CMS
 Most of the companies are owned by the government
 The companies in this industry require long term investments
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Cash Management Services at ICICI Bank
ICICI Bank's Cash Management Services offer a full range of receivable and payable services
to meet your complex cash management needs. Payments received from your dealers/
distributors and made to your suppliers are efficiently processed to optimize your cash flow
position and to ensure effective management of the operations of your business.
ICICI Bank provides a gamut of products and services, ensuring that all the business
requirements of the corporations are met under one roof. Further, ICICI Bank constantly
innovates and improves its product offerings in order to improve client servicing.
Key Benefits:
• Widest network across India
• Comprehensive range of CMS products
• Strong logistics support
• Advanced technology support and a highly competent team
• Dedicated and trained Customer Care
• Ensuring timely deposit of collections
• Timely execution of disbursement request
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Collection Solutions
ICICI Bank offers a wide range of collection products to meet the specific requirements of
the clients like local cheque collections, upcountry cheque collections, cash collections and
electronic collections. With a wide network, customized MIS and multiple channels for
delivery of MIS, ICICI Bank renders quick and effective management of receivables.
CICI Bank offers a wide range of collection products to meet the specific requirements of the
clients. The products offered are as follows:
• Local cheque collection through:
o ICICI Bank branches
o Correspondent bank branches
• Upcountry cheque collection through:
o ICICI Bank branches
o Correspondent bank branches
o Other banks
• RTGS integrated collections
• Electronic collections (through auto-debit)
• Cash collections through our Doorstep banking services
Features
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• Wide network coverage of over 670 own locations and over 4200 correspondent bank
locations
• Capability to process cheques drawn at any location
• Assured payment on fixed day basis, irrespective of the fate of the instrument sent in for
clearing
• Instrument outstanding report and credits in the pipeline report available to strengthen internal
control
• Multiple channels available for receipt of data including e-mails, faxes, courier and the
Internet
• Prompt realisation of cheques through an extensive network, supported by correspondent

banking relationships
• Availability of information on the amounts deposited at multiple locations with information

available at the instrument level
• Provision of uploading the system generated deposit slip details, in a single file
• Customised MIS and availability of scan images of instruments at select locations
Payments
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The payment solutions offered by ICICI Bank include bulk disbursement solutions for
making payments to channel partners through multiple modes, Payable at Par solutions for
payment of dividend, interest or for redemption and Internet-based cheque writing facility for
printing of cheques at your own premises.
ICICI Bank offers payment solutions that cater to all the requirements of a corporation. The
payment product suite includes bulk disbursement solution through Integrated Payment
System, Internet-based cheque writing which facilitates printing of instruments at your own
office and Payable at Par solution for payment of dividend, interest and for redemption.
Key Features
Payment solutions of ICICI Bank offered through Integrated Payment System (IPS) not only
offers multiple modes of payment but also facilitates functional, operational and financial
benefits like:
• Single file upload to effect multiple modes of payments
o Physical modes include cheques, demand drafts
o Electronic modes include direct credit to ICICI Bank account holders, RTGS
and NEFT
• Web-based access for uploading and authorizing printing requests
• ERP extractor for extracting data directly from the ERP system
• Host-To-Host connectivity for Straight Through Processing of transactions
• Data encryption for enhanced security
• Partial batch authorization and processing
• Dynamic signature printing
• Printing of instruments and direct dispatch to beneficiaries
• Tracking of dispatches
• Advices over e-mail to beneficiaries
• Customized annexure printing for cheques
• At par cheques payable at over 700 locations
• Customized MIS
Product Analysis
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Almost every bank in the country offers Cash Management Services (CMS). Thus it becomes
important to understand the different products offered by different banks. Undertaking a
product analysis helps the bank to understand where it stands when it s compared to
competing banks. It shows where the bank lies ahead and where It lags in terms of other
banks in the country. A product analysis was done to understand the different CMS products.
The following banks were included in the comparison:
1. Bank of India
2. Corporation Bank
3. HDFC Bank
4. Axis Bank
5. Citi Bank
6. HSBC Bank
7. Standard and Chartered Bank
Bank Canar ICIC HDF Citi HSB
Corp Axis
Product/ Bank of a I C Ban C SCB
Bank Bank
India Bank Bank Bank k Bank
Collection Based
LCC Yes Yes Yes Yes Yes Yes Yes Yes Yes
UCC Yes Yes Yes Yes Yes Yes Yes Yes Yes
Foreign currency
Yes No No No No No Yes Yes Yes
cheque
Cash Collection No No No Yes No No No Yes Yes
Post Dated
Cheque Yes Yes No No No Yes No No No
Collection
Payment Based
ECS Yes Yes Yes Yes Yes Yes Yes Yes Yes
NEFT Yes Yes Yes Yes Yes Yes Yes Yes Yes
RTGS Yes Yes Yes Yes Yes Yes Yes Yes Yes
Payable at Par
Yes Yes Yes Yes Yes Yes Yes Yes Yes
cheques
International
No No No No No No Yes Yes Yes
Payments
Dividend
No No No Yes Yes Yes No No No
Payment
Lockbox/Dropbo
No No No Yes No Yes Yes Yes Yes
x
Liquidity Mgmt No No No No No No Yes Yes Yes

Conclusions from Product Analysis
26
1. All the products can be summarized in the following three categories
a. Collection Based
b. Payment Based
c. Liquidity Management Based
2. All the banks offer products which are of a similar nature
3. Foreign Currency Cheque Collections and Payments are offered only by the
international banks in the market
4. Even Liquidity Management based products are offered by these banks
5. Cash collections is offered only by ICICI bank , HSBC Bank and Standard Chartered
Bank
6. Post Dated Cheque Collections is a prime product for Government Banks
7. The market is saturated with products of similar nature with no bank having a
breakthrough product
27
Competitive analysis
Competitive analysis in marketing and strategic management is an assessment of the strengths
and weaknesses of current and potential competitors. This analysis provides both an offensive
and defensive strategic context through which to identify opportunities and threats.
Competitor profiling coalesces all of the relevant sources of competitor analysis into one
framework in the support of efficient and effective strategy formulation, implementation,
monitoring and adjustment. The Cash Management Services (CMS) industry is very
competitive as almost every bank provides CMS. It becomes important to understand
competition to keep up with the latest trends in the market.
1. HDFC Bank:
Product Definition:-
HDFC Bank Locations /Branches
Speed:-Local cheques collection at HDFC Bank Locations e.g. cheques deposited in Delhi
and payable at Delhi.
Sprint:-Outstation cheques collection on HDFC Bank Locations e.g. cheques deposited at
Delhi and payable at other HDFC Bank location say Pune, Chennai, and Mumbai etc
Correspondent Bank Locations /Branches
Rapid:-Local cheques collection at Corr Bank Locations e.g. cheques deposited in Wardha
and payable at Wardha.
Express:-Outstation cheques collection on Corr Bank Locations e.g. cheques deposited at
Chennai and payable at Corr Bank location say Munnar
Clean:-Outstation cheques collection on Non covered Locations e.g. cheques deposited at
Chennai and payable at Non covered location.
CMS Collection Products at HDFC Bank:
CMS Process Flow:
- Client can open only one corporate current account with HDFC Bank. Customers can
also use the existing corporate current account with the Bank for this CMS facility.
- A CMS Client code is provided to the company at the time of setup. All the deposits in
the CMS account are to be made with reference to this unique client code. All the cheques
can be collected from the designated client’s office through a courier service.
- If the courier facility is not availed, the cheques are to be deposited with the designated
HDFC Bank branch or a coordinator along with a specific CMS deposit slip for that
product before the cutoff time.
- Daily MIS is provided with the collections in the account for that particular day in a soft
copy at the Email IDs given at setup by the client. The bank can customize the MIS in the
format as desired by your company.
28
- E-Net viewing: Under this facility the company can view all the details that are required.
The details are provided under 2 heads :
- The Account Viewing where you can see the account statement, balance, etc.
- The CMS module where the company can view the deposits on that day, the day of credit
for these cheques.
CMS Pricing and Arrangements:-
CMS offers you the facility of clearing of local / outstation instruments favoring an
organization deposited at our various branch locations with pooling of funds at Mumbai or
any other location where HDFC bank has presence on very competitive terms. CMS
eliminates the inherent delays of a traditional funds transfer mechanism. CMS enhances
liquidity and ensures optimum planning and utilization of funds. In addition to faster access
to funds, CMS provides you with MIS, which will help improve your reconciliation.
LOCAL CHEQUES & FUNDS TRANSFER – (Subject to Clear Fund Basis)
Product Business Funds flow mechanism Service charges

locations
Speed Local High DAY 0 – Instruments Nil

chqs value deposited at the respective
collection locations before the
at HDFC prescribed cut off time.
Bank
location
DAY 0- Funds pooled at

Mumbai** by credit to
your account with our
Bank for deposits made at
the locations.
Non DAY 0 – Instruments Nil

High deposited at the respective
value locations before the
prescribed cut off time.
DAY 2 - Funds pooled at

the locations.
29
HBTRF chqs DAY 0 – Instruments Nil
collection deposited at the respective
at HDFC locations before the
Bank prescribed cut off time.
location

the locations.
OUTSTATION CHEQUES & FUNDS TRANSFER
PRODUC BUSINESS FUNDS FLOW MECHANISM SERVICE

T LOCATIO
30
NS CHARGES
Sprint HDFC Bank DAY 0 – Instruments deposited at Nil

locations the respective locations before the
prescribed cut-off time for clearing.

Mumbai** by credit to your
account with our Bank.
** Funds will be pooled to your account with HDFC bank Ltd

OTHER CHARGES:
1. Rs.100/- flat per return instrument
2. Courier can be organized on behalf of the company for picking up the checks from
your branches at Rs.400/- per pick-up location per month within City limits.
3. Service Tax and Educational Cess @ 12.36% shall be charged as applicable.
4. Outstation clearing courier charges Rs 20.00/packet.
VALUE ADDITIONS:
1. Daily report on location wise collections/returns.
2. Monthly report on total collections and service charges.
3. Monthly report on total payouts and service charges.
4. Enet facility to check / validate cheque collection across location at one central place
through deposit and instrument query.
5. Any additional report, in mutual consultation which the company may be requiring
from time to time.
DOCUMENTATION:
1. The company to execute an Application-cum-Agreement / Fax indemnity.
2. To provide a board resolution for availing the Cash Management Services from our
Bank.
31
3. To provide a list of signatories who are authorized to give instructions to the bank for
operating the services.
OTHER TERMS:
1. The above services are demand facilities, subject to our ongoing review and the terms
conditions, pricing etc. may be modified or services recalled without notice at the
banks absolute discretion.
2. The process flow is exclusive of intervening bank holidays for clearing purposes.
3. There is no high value clearing on Saturdays, hence the process flow will change
accordingly.
4. Sundays & other bank holidays have been excluded for the purpose of calculation of
the above referred days.
NETWORK:
Express Locations: 778
Rapid Centre’s: 288
HDFC Bank Locations:
32
1. Andaman and Nicobar Islands: 0 2. Andhra Pradesh: 18
3. Arunachal Pradesh: 0 4. Assam: 3
5. Bihar: 7 6. Chandigarh: 4
7. Chhattisgarh: 4 8. Dadra and Nagar Haveli: 1
9. Daman and Diu: 1 10. Delhi: 7
11. Goa: 6 12. Gujarat: 54
13. Haryana: 17 14. Himachal Pradesh: 9
15. Jammu and Kashmir: 2 16. Jharkhand: 9
17. Karnataka: 13 18. Kerala: 22
19. Madhya Pradesh: 18 20. Maharashtra: 29
21. Manipur: 0 22. Meghalaya: 1
23. Mizoram: 0 24. Nagaland: 0
25. Orissa: 9 26. Pondicherry: 1
27. Punjab: 45 28. Rajasthan: 16
29. Sikkim: 1 30. Tamil Nadu: 17
31. Tripura: 1 32. Uttar Pradesh: 23
33. Uttarakhand: 8 34. West Bengal: 13
2. BANK OF INDIA
Collection of cheques
• Local Cheques & Upcountry cheques at places where Bank’s branches exist.
• Upcountry cheques at places where Bank’s branches do not exist.
• Instant credit as per arrangement on any day before realization.
33
• Customized MIS, Including outstanding entries at any time.
• Pooling is possible, including multiple pooling.
• Single point reference for any detail/data.
• Courier Pick-Up from Customer’s Collections.
Post Dated Cheques Collection:
• Post –dated cheques (PDC’s) vaulted, dispatched to drawee center three days in advance
collected on due dates and credited to account on due date or next day.
• Tracking of customer’s invoices with PDC’s possible.
• Auto Reconciliation.
• Unpaid/Returned PDC’s also properly tracked and accounted.
• All other advantages of collections.
Payments
• Centralized or Remote printing of payments (Cheques/Pay Orders/DDs/IWs/DWs/Ros-with
Facsimile signatures)
• Printing of Cheques on continuous stationery.
• Interface with RTGS/NEFT/ECS.(Linkage to e-modes)
Correspondent Banking
• Issue of DDs by branches*of Correspondent Bank.
• Funding before issue/upon payment.
• Auto Reconciliation.
(* On places where Bank’s CBS branches situate or even places where Bank’s branches not
Suitable-thro similar correspondent /courier arrangement)
General:
• Customized MIS of data in whichever way desired.
• Interface between Finnacle and CMS Software.
Time Frame for Collection of Local / Outstation Cheques / Instruments :
For local cheques presented in clearing credit will be afforded as on the date of settlement of
funds in clearing and the account holder will be allowed to withdraw funds as per return
34
clearing norms in vogue.
Cheques / Instruments presented in high value clearing (with the minimum value of Rs. 1 lac)
shall be credited on the same day (applicable only in areas covered by high value / same day
clearing).
For cheques and other instruments sent for collection to centres within the country, generally
the following time norms shall be applied :
a) Cheques presented at any of the four major Metro Centres (New Delhi, Mumbai, Kolkata
and Chennai) and payable at any of the other three centres : Maximum period of 7 days.
b) Metro Centres and State Capitals (other than those of North Eastern States and Sikkim):
Maximum period of 10 days.
c) In all other Centres : Maximum period of 14 days.
d) Cheques drawn on foreign countries: Such instruments are accepted for collection on the
‘best of efforts’ basis. Bank may enter into specific collection arrangement with its
correspondent bank for speedy collection of such instrument. Bank would give credit to the
party on credit of proceeds to the bank’s Nostro Account with the correspondent bank after
taking into account hold periods as applicable to the countries concerned.
The above time norms are applicable irrespective of whether cheques/instruments are drawn
on the bank’s own branches or branches of other banks.
Service Charges:
Nature of Service Individual Non Individual
Cheques sent for Upto Rs 500- Rs 15 per instrument Upto Rs 500- Rs 10 per
collection (PI) instrument (PI)
Rs 501-100: Rs 25 PI Rs 501-100: Rs 20 PI
35
Rs 1001-10000: Rs 50 PI Rs 1001-10000: Rs 45 PI
Rs 10001- 1 lac: Rs 100 PI Rs 10001- 1 lac: Rs 100 PI
Above Rs 1 lac: Rs 150 PI Above Rs 1 lac: Rs 150 PI
RTGS (charges per Rs 1- 5 lacs: Rs 25 Rs 1- 5 lacs: Rs 25

transaction)
Rs 5 lacs and above: Rs 50 Rs 5 lacs and above: Rs 50
NEFT and EFT Upto 1 lac: Rs 5 per transaction Upto 1 lac: Rs 5 per
transaction
Rs 1 lac and above: Rs 25 per
transaction Rs 1 lac and above: Rs 25 per
transaction
ECS Credit Clearing (per entry/ item):

NCC Clearing House – No charge FREE
Destination Bank – No charge
Sponsor Bank – Rs. 5.50
(Min. Rs. 2500/-)
Debit Clearing (per entry/ item):
NCC Clearing House – No charge FREE
Destination Bank – No charge
Sponsor Bank – Rs. 4.00
(Min.Rs.2500/-)
Returning charges - Rs. 80/- Returning charges - Rs. 50/-
Collection of Upto Rs.10,000/- : Rs. 120/- per bill

Bills Above Rs.10,000/- upto Rs.1 lac : Rs.
12/- per
Rs.1000/- or part thereof (Min.
Rs.250/-)
Above Rs.1 lac : Rs. 10/- per
Rs.1000/- or part
thereof Min. Rs.1200/- Max.
Rs.35,000/-
Collection Charges Upto Rs.5000/-: Rs.10/- per Same

under Star Speed instrument
Cheque collection
scheme Rs.5001/- to Rs. 50000/-: Rs. 15/- per
36
instrument
Rs.50001 to Rs. 1 lac : Rs. 20/- per
instrument
Above Rs. 1 lac: Rs. 30/- per
instrument
Cheque Return Charges
Due to technical reasons: Rs. 60/-
per instrument PLUS entire out-of-
pocket expenses.
Due to non-technical reasons_ Rs.
100/- per instrument PLUS entire
out-of-pocket expenses.
Collection charges Instruments upto Rs. 1 lac: No Same

under Speed charges
Clearing
Instruments above Rs. 1 lac: Rs.
150/- per instrument
Network:
37
11. Goa: 37 12. Gujarat: 268
3. Corporation Bank
Banks has been always aiming to create values for its customers. Looking beyond traditional
banking, the Bank introduced an array of other products and services to different customer
segments. Cash Management Services is one such solution offered by the Bank to the
corporate customers. Every organization has receivables to collect from its dealers/ depots/
customers. Every revenue collected by the organization gets paid in one form or the other.
Collection And Payment Services (CAPS) provides customized solutions to corporate' needs
in liquidity management.
38
Fast Collection Service
Fast Collection Service (FCS) is the premier product of the Bank under CAPS range of
products. FCS envisages elimination of one leg of movement of cheques from drawer to
beneficiary’s place and travel back to speed up the process. The corporates can access the
collections effected at 301 LOCATIONS (OPERATING CENTRES) across the country
covered under the arrangement within 24 to 48 hours at a location of corporate’s choice.
Corp Clear Services [CCS]
CCS ensures quick collection of outstation cheques. The product enables assured credit on
predetermined day of corporate’s choice, in respect of upcountry cheques deposited with
specialized CAPS branches irrespective of the day of realization. The need-based product
range under this segment includes
Corp Clear Services - 8th* Day
Corp Express Services - 4th * Day
Corp Instant Services - Next Day
(* for cheques drawn on locations where CorpBank has branches)
Corp Collect Service [ CCT]
Corporates apprehensive of cheque realizations may use their Corp Collect Service that
operates on “Realize and Pay” basis. The Service is extended for both within and outside
network locations. All the benefits of other corp. clear services do come along with Corp
Collect Service.
Corp Comfort Services
Waiting unduly and without certainty as to realization of outstation cheques would hamper
the business cycles. With an assured credit on 8th day in respect of outstation cheques falling
outside network, CorpComfort Service proves an effective blend of CorpClear Service and
CorpInstant Service.
Corp Remit Services
CorpRemit Service meets the corporates’ wholesale payment requirements such as statutory
payments, payments to vendors/suppliers, banking requirements, inter branch transfers etc.,
Corporates need just to hand over the payout instructions file along with funding cheque to
CAPS branch. Further Servicing will be taken over by the CAPS outfit. One of the salient
features of CorpRemit is that corporates get confirmation on payout effected. Remittances
can also be sent through RTGS to over 25000 bank branches across the country.
Corp Pay Services

39
Corp Pay Service facilitates corporates’ to make retail payments very effectively. Some of the
payouts that can be very effectively and conveniently handled include disbursal of incentives,
equity and debt servicing to the satisfaction of investors, salary and wages payouts etc. All
that corporate need to do is to furnish the payout details in magnetic media/mail and the
funding therefore. Rest is only client satisfaction. Value added service such as dispatch of
payout instrument to beneficiary is also made available. All these are available at a very
competitive price exclusively for corporates.
Payment Processing Centre
Continuing the initiatives in re-engineering the Cash Management Process, Payment

Processing Centre was set up to replicate the success achieved in collections in payments too.
At PPC, capabilities are built to print exceptionally large number of Demand Drafts with
advice. Value added service such as dispatch of payout instruments to beneficiaries is being
undertaken.
PDC Hub
Considering the huge market available and market demand for collection of PDC cheques,
PDC Hub was setup exclusively for handling bulk PDC cheques received from Finance
Companies, Banks etc towards repayments loans extended by them.
CorpNet - an Internet banking facility
Symbolizing the commitment to deliver value added services to clients using CAPS with
continuous improvements year after year, the Bank has made the use of the state of the art
technology. CorpNet an internet banking facility is now available to all corporates using
CAPS for their cash management needs. CorpNet optimizes the efficiency of corporates cash
management. CorpNet provides for a host of advantages to corporates using CAPS.
Convenience, information online, data modulation, cash inflow forecast, outstanding position
of instruments sent for collection are some of these distinct advantages coming without any
extra cost. A very high level of security features are incorporated to afford greater degree of
client comfort using this technology driven value addition.
Correspondent Banking Arrangement
Corporation Bank has developed structured products exclusively to the agency services
requirements of clients of correspondent banks under the umbrella of Correspondent Banking
Arrangements. The product can be used by top rated corporate houses within the country for
effecting cash disbursal across country.
Speed Remittance:
Under this arrangement, the NRIs can send remittances through exchange houses across
globe. The exchange houses send the details to our Nodal branch (PPC Branch) at Bangalore
who in turn credit the same to the beneficiaries accounts maintained in any of our branches.
40
In case the beneficiary account is not held in our Bank, a pay order can be issued at the
destination, which can be collected by the beneficiary.
Payment Gateway:
The Division, with futuristic view in mind where web trade is taking shape gradually in India
especially amongst urban population, has decided to offer payment gateway solutions to
corporate having its own trading sites on Internet. The product envisages providing buyers
having account with our Bank an opportunity to pay for the purchases made on the net.
Through this product our corporate customer will get wider base for selling their products
ECS payments / Collections:
The product envisages large volume, low value bulk collections and payments from various
accounts at select ECS locations. The same can be handled through select specialized CAPS
branches.
Service charges:
Sl. Type of Service Service Charges [Incl. Service

No. Tax]
3.01 Collection of Outward / Inward Cheques:

Upto Rs. 10,000/- Rs. 55/- per instrument
Rs.10,001/- to Rs.1,00,000/- Rs. 110/- per instrument
Rs. 1,00,001/- and above Rs. 165/- per instrument
3.02 Collection of Outward / Inward Bills

Upto Rs.1000 Rs. 50/-
Rs.1001 to Rs. 5000 Rs. 60/-
Rs.5001 to Rs.10,000 Rs. 100/-
41
Rs. 10,001 to Rs 50,000 Rs. 8.00/1000 [Min Rs. 100]
Rs. 50,000 to Rs 1,00,000 Rs. 8.00/1000
> Rs. 1,00,000 Rs. 8.00/1000 (Max Rs.17,000)
3.03 Return / Dishonour of Bills / Cheques

Cheques received in inward clearing
For Savings accounts Rs.100/-
For Current, Overdraft & Cash Credit accounts Rs.150/-
Cheques sent in outward clearing
(Cheques deposited by customer)
Rs.50/-per instrument
For Savings accounts Rs.100/- per instrument
For Current, Overdraft & Cash Credit accounts 50% of collection charges
Dishonour of local / outstation bills and outstation (Min Rs.60)
cheques
4. CANARA BANK
CORPORATE CASH MANAGEMENT SERVICES (CCMS)
The speedier Corporates are, it’s easier for them to address the challenges of globalization.
Corporate Cash Management Services (CCMS), an innovative service offered by Canara
Bank for speedy collection of cheques and other instruments, places Corporates on a faster
track. In more ways than one-such as definite funds flow, better cash management and
deployment of funds, better monitoring of funds flow, optimum allocation of funds and
effective planning of investment functions.
WHAT IS CCMS:
• An innovative service specifically tailored to meet the requirements of
42
Corporates/Business houses/Partnership firms.
• Speedy collection of outstation cheques and other instruments.
• Pooling of funds at designated centers.
• More importantly, providing funds to the Corporates as per their need.
• Customized MIS reports.
WHAT CANARA OFFER:
Under CCMS they offer the state of the art technology products.
• SUPERFAST SERVICE - Local cheque collection services
• FASTRACK SERVICE - Upcountry cheque collection services
• BULK COLLECTION SERVICE - Bulk cheques collection services
Under 'SUPERFAST SERVICE', agents or offices of Corporates can deposit the cheques to
be cleared in the local clearing and funds will be pooled at any pooling branch designated by
the Corporates.
Under 'FASTRACK SERVICE', agents or offices of Corporate can deposit the cheques drawn
on outstation centers and proceeds will be pooled at any pooling branch designated by
Corporate.
Under 'BULK COLLECTION SERVICE', agents or offices of Corporate can deposit their
bulk (large number) instruments of small value to be cleared in the local clearing and funds
will be pooled at any pooling branch designated by the Corporate.
Network of CCMS centre’s:
11. Goa: 3 12. Gujarat: 8

43
Service Charges:
CHEQUE COLLECTION
Inward / Outward Collection of Outstation cheques / instruments

5. Outstation
such as DDs/ Dividend / Interest Warrants, Refund Orders, Income
cheque collection
Tax Refund orders etc. (other than bills)
INDIVIDUALS
Amount ranging
OTHER THAN INDIVIDUAL
From - To OTHER THAN
RURAL
RURAL
44
Up to Rs.
Rs. 50/- per instrument
10000/-
Rs.10,001/- to
Rs. 1,00,000/-
Rs. 1,00,001
and above
NEFT Money Outward : Upto Rs 1 lac- Rs 5/- per transaction

Inward = NIL
transfer Above Rs 1 lac –Rs 25/- per transaction
7. RTGS Money Outward : Rs 1 lac to Rs 5 lac- Rs 25/- per transaction

Inward = NIL
transfer Above Rs 5lac - Rs 50/- per transaction
SFMS (IFN Outward Rs 1/- per Rs 1000/- or part there of subject to a

Inward = NIL
100) minimum of Rs20/- and a maximum of rs 2000/-.
Credit/Debit =
ECS
NIL
Immediate Credit of outstation cheques upto Rs.15000/-
5. Axis Bank:
Collection Solutions - Power Collect: Managing Receivables Collections
Axis Bank facilitates faster collections by enabling quick realization of local and upcountry
cheques and pooling the funds in a central account. The bank provides the following
collection products:
Local Cheque Collections (LCC)
Axis Bank locations:
45
With a large network of branches, the bank is able to collect locally payable cheques across
the country. The branches are equipped to handle large volume of instruments and ensure that
the funds are pooled as per the agreed timelines even before the same are realized.
Non Axis Bank locations:
Currently the bank has Correspondent Banking arrangement with multiple Banks to use their
branch network. The bank has appointed our Coordinators at various locations to facilitate the
company cheque pick-ups and ensure that they are immediately processed in the local
clearing through a Correspondent Bank.
LCC enables the company to realize funds (on an assured day) through cheques payable
within the purview of local clearing. The bank provide these services at
• Axis Bank Network: 426 locations with courier pickup facility
• Coordinator Network: Locations with courier pickup facility can be added as per the
company business requirements
Upcountry Cheque Collection (UCC)
UCC enables the company an assured credit for outstation cheques on a designated day in any
of the company account across the country (at any of the Axis Bank branch) with a
customized MIS. In addition to Axis Bank and correspondent bank centers (3000 locations),
all the locations are being covered under Remote Cheque Collections, offering the company a
one-stop-solution for all the company outstation cheques across the country.
Axis Bank locations:
The Banks wide network of Branches ensures that most of the company’s outstation cheques
would be covered within Axis Bank network. This would result in faster realization of funds.
Further, funds can be pooled into the company account even before the instruments are
realized as per the arrangement.
Non Axis Bank locations:
To further extend the offering to process the company Outstation Cheques at Non Axis Bank
locations, the bank have tied up with other banks to act as our Correspondent Bank and
ensure that all the company Outstation Cheques are collected and immediately presented for
clearing.
Remote Locations:
46
There could be a possibility wherein the location where the outstation cheque is drawn on is
not covered under our extended network with correspondent banks. The bank still can offer
the company to collect the same and send it directly to the Drawee location for realization.
Bulk Collections - Utility Bills or PDCs Management:
The bank handle the complete life cycle of the Post Dated Cheques till they are realized. All
the activities like maintaining PDC inventories, retrieval and depositing the cheque for
payment, re-presentation of a bounced cheque and exception handling (stop payment etc.) are
conducted by the Bank on behalf of its customers.
At Axis Bank, the bank offer solutions to meet Bulk Collection Requirements ie, Post Dated
Cheques (PDCs), Bulk Collections through Cheque clearing or ECS debit services, etc. The
Bank processes collections in a convenient and efficient way to avoid any reconciliation
issues. The bank have required infrastructure, technology and capability to manage and
handle PDCs through our dedicated team that manages inventory of cheques and timely
presentation of the same, well supported with MIS ensuring maximum benefits to the
organization
Utility bill collection:
Axis bank offers ease & convenience to its customers and utility subscribers in their bill
payment by facilitating bill payments via online & offline modes for various utility service
providers.
The various popular channels offered by Bank for bill payment are:
Online Mode:
Electronic Clearing Services (ECS)
Collection through Internet and ATM for common customers
Collection through Bill payment Kiosks
Offline Mode:
Drop boxes at branches of Axis bank/Departmental stores/Mobile Galleries
Onsite and Offsite ATMs
Pick up from customer service centers and other authorized outlets
47
Presently the bank has tied up with utility service providers like MTNL, BPL Mobile,
AIRTEL, Reliance Energy, Mahan agar Gas, NDPL and more in the pipe line.
The Axis bank's extensive network & prominently placed ATMs provide reach and access for
customers to pay their bills. Bill payment service from Axis bank has a robust and proven
technology to ensure reliability, security and performance and is aptly supported by a
dedicated desk for efficient functioning and customer service..
Collecting Bankers for IPO or FPO or Rights Issues
As collecting bankers, the bank provides you services relating to:
• Public or Rights Issues
• Private Placements
• Buyback offers
The bank provides Collecting or Escrow Banker services for Initial Public Offer (IPO) and
for Further Public Offer (FPO) to handle collections of application forms and instruments
received. Our extensive branch network of 236 locations, robust processes and systems and
an experienced team across the country enable us to act as a leading collecting banker. The
bank endeavors that Companies, Merchant Bankers, Registrars, and Syndicate Members
receive high quality service and satisfaction.
In this current scenario of cut-throat competition, Axis Bank has designed its products to
minimize the issues faced by you in the area of fund management and reconciliation. Our aim
is to reduce the cost, time and efforts faced by corporate in collection and payment issues.
The bank provide you complete solutions to all the company CMS needs to enable you to
devote more time and effort towards improving the company business
ECS Debit:
ECS Debit is an electronic clearing system that facilitates paperless debit transaction. Axis
Bank facilitates ECS Debit on all the locations that are activated by the respective local
clearing houses. The bank accepts the electronic file centrally for all the locations and
arranges to upload it at the RBI site. The realized funds get pooled to a centralized account.
Network:
CMS Branch in States:
48
45. Goa: 4 46. Gujarat: 39
Correspondent Bank Location: 825

RTGS &NEFT Locations: 187
Service Charges:
49
6. HSBC BANK
Integrated Receivables Solutions (IRS)
50
The bank understands how important accounts receivables management is to the company
business cycle. The more control you have over the company cash flow, the lesser will be the
need for working capital required for running the company business. The faster you convert
receivables into cash, the lower will be the risks associated with the company business. At the
same time, in today's competitive environment, this has to be matched with minimization of
transaction charges and must bring in efficiencies in the company business processes.
HSBC's Integrated Receivables Solutions (IRS) offers you an opportunity to outsource the
company receivables process, from picking up cheques from the company customers, usage
of strong logistics management and correspondent bank relationships for faster processing
and clearance of the company receivables to world-class systems and processes to allow you
to have a complete control over the company cash flows and receivables.
Benefits of Integrated Receivables Solutions (IRS)
• Faster realization of receivables through our strong logistics management &

geographic reach
• Savings in interest costs and Bank charges through rationalization of account structure
and local clearing at over 350 locations across the country
• Simplification of process through Online querying on receivables
• Simplification and automated Bank Reconciliation
• Outsource debtor's reconciliation
The bank provide you with a single window for processing, tracking, reconciling and
managing all the company receivables - paper and electronic through our online delivery
platform – HSBCnet
Key Features of HSBC's IRS:
• Local clearing of cheques at over 350 locations across India
• Faster realization of outstation cheques through correspondent banks with a strong

regional presence covering over 5,000 locations across India
• Cheque pick-ups at over 350 locations directly from company's offices/customers
• Single collection account for cheque deposits across the country
• Cash concentration in the centralized collection account
• Collection reports with details of cheque number, drawer's name, date and place of
deposit and invoice details
51
• Online querying on instruments deposited across the country
• One platform for all forms of collections i.e. cheques, cash and electronic Automated
Bank
• Automated Reconciliation through integration of collection reports with the company

Back Office Systems
• Reconciliation of invoices against receipts from the company customers
Products:
Paper Collection
IRS is structured to offer quick realization of the company instruments, local or outstation.
The proceeds of all cheques deposited with HSBC can be concentrated into a designated
central account at any of our branches. Consequently you have better control on the company
cash flows and the reconciliation and monitoring requirements associated with multiple
accounts are eliminated. Information on these collections is delivered to you through
HSBCnet.
IRS further delivers a variety of collection reports that can be used for automating the
reconciliation process at the company end.
• Local Clearing Solutions
HSBC has an extensive network of its own branches and correspondent banks that
provide you with the capability to clear the company instruments in local clearing at over
350 locations across India. The funds collected from these instruments can directly be
credited to the company centralized collection account. At each of these locations, HSBC
provides you with the option of directly picking up the instruments from the company
customers. Detailed collection reports provide you with information on the instruments
deposited at each of the locations.
• Outstation Clearing Solutions
HSBC has correspondent bank relationships with strong regional banks covering over
5,000 locations across India. This ensures faster realization of the company upcountry
instruments. Detailed collection reports and online querying options on HSBCnet ensure
that you can track and have complete control over the company receivables.
• Smartcollect
Smartcollect provides you HSBC's extensive global reach of over 10,000 offices in 83
countries for efficient collection of foreign currency cheques.
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Electronic Collections
IRS helps the company business process improvement objectives with a comprehensive array
of electronic collections, including
• Domestic electronic funds transfer such as RTGS, NEFT, ECS
• International wire transfer
• Direct debit
Receivables data accompanying these transactions is captured and delivered to you

electronically to support the company customer order fulfillment, credit management and
reconciliation process.
Receivables Management System
Built with advanced modular technology, our receivables management system brings together
all the IRS components. Its automated reconciliation and information management modules
are fully integrated with the collections and processing features of IRS. As the backbone of
IRS, our receivables management system:
• Consolidates receivables information across electronic and paper collections
• Automates accounts receivables reconciliation using the company pre-defined

matching parameters for funds received against various invoices
• Delivers collection reports structured to meet the company specified needs
• Provides online transaction enquiry
Integrated Payment Solutions (IPS)
Payments entail a broad spectrum of requirements, with constantly varying payment formats
and systems. While paper-based payments currently constitute a majority of payment modes
in the country, electronic-payments are fast gaining importance.
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Managing these constantly evolving and varied requirements, while seeking to effect the
company payments in a timely and accurate manner, is an administrative burden that the
company would like to do away with - but at the same time it would like to ensure that the
company internal guidelines and controls are in place.
Benefits of HSBC's integrated Payment Solutions (IPS)
• Reduction in the overall end to end cost of processing payments and accounts
reconciliation
• Enhanced reconciliation resource optimization in payments processing and account

reconciliations
• Improved Risk Management and Controls
• Improved vendor relationships
Key Features of HSBC's IPS
• A single point of entry for real-time information & transaction - execution for all the
company accounts
• Solution for online creation or file uploads of payment instructions for execution
through varied modes like Cheques, Drafts, RTGS, NEFT & Account Transfers
• Options for instruction level or file level authorization or pre-authorized modes of

initiation
• Flexible and scalable authorization matrix permitting multiple authorizing levels
• Availability of varied Account Statements and Reverse MIS files for automated
reconciliation within the company systems
• Safety and security through two-factor authentication
• Industry benchmark security through 128 bit SSL encryption
HSBC IPS Products
Cheque Outsourcing Services
Cheque Outsourcing Services facilitates outsourcing of the company paper-based payment to

HSBC. The bank support individual/bulk issuance of payable at par company cheques,
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Demand Drafts and Cashier Orders. The bank manages the company paper-based payment
processing by providing solutions on:
• Printing of instruments with customized payment advices
• Online querying & reconciliation of instruments through varied reports
• Outsourcing of instrument dispatches directly to the beneficiaries
• Remote authorization of payments for the company mobile signatories
• Rationalization of work flows and payment related activities
Priority Payments
Priority Payments is a suite of electronic payment products including NEFT & RTGS that
you may leverage on to pay the company beneficiaries in a timely fashion:
• Reduction in cost of Demand Drafts Rationalization of courier lead time and expenses
• Urgent payments at over 1000 RTGS locations and 700 NEFT locations
• Reduction in the risk of fraudulent encashment associated with paper-based

instruments
• Reduction in administrative activities like maintenance of dispatch records, cheques

etc
SmartCheque
SmartCheque is suited for the company low value, urgent paper payments: a solution, which
enables you to issue cheques at the company end which are payable at par at all HSBC
branches.
Advising Solution
In this, the bank intimates the company beneficiary of the payment and its underlying details.
In addition to the paper-advice that will accompany each payment instrument, our Advising
engine additionally provides:
• Advice delivery to multiple recipients through email, fax or mail
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• All payment types initiated through HSBCnet are supported
• All payment types initiated through HSBCnet are supported Inter-account transfers,
Cashier Orders, Demand Drafts, Corporate Cheques, EFT, NEFT & RTGS
• User defined templates for recipient information & advising details are supported
Service Charges:
Up-Country Cheque Collections within India:
Outstation Cheque Collection INR 50 per instrument (upto INR

(Charges applicable w.e.f. 1 Dec 2008 as per RBI 10,000)
Circular dated 8 Oct 2008) INR 100 per instrument (INR 10,000
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(Charges exclusive of service tax) - INR 1 lakh)
INR 150 per instrument (greater than
INR 1 lakh)
Up-Country Cheque Collections outside India:
Foreign currency cheque clearance: 0.5% of the value of the cheque or Rs. 300 whichever is
higher
(Charges exclusive of service tax)
Others (Issuing a cheque in a country/location where HSBC has branches) 0.35% of the value
of the cheque or Rs. 50 whichever is higher
Others (Issuing a cheque in a country/location where HSBC has no branches) 0.40% of the
value of the cheque or Rs. 100 whichever is higher
Cash Delivery/Pick up: 250/ 225/200
Bill Payments:
Through Internet Banking and PhoneBanking: Free
RTGS (charges per transaction): Rs 1- 5 lacs: Rs 25
Rs 5 lacs and above: Rs 50
NEFT and EFT: Upto 1 lac: Rs 5 per transaction
Rs 1 lac and above: Rs 25 per transaction
7. Standard Chartered
Standard Chartered is highly recognized as a leading cash management supplier across the
emerging markets. Their Cash Management Services cover local and cross border Payments,
Collections, Information Management, Account Services and Liquidity Management for both
corporate and institutional customers. With Standard Chartered's Cash Management services,
the corporate will always know their exact financial position. The corporates have the
flexibility to manage their company's complete financial position directly from the computer
workstation. The corporates will also be able to take advantage of the banks outstanding
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range of Payments, Collections, Liquidityand Investment Services and receive comprehensive
reports detailing their transactions. With Standard Chartered, the corporates have everything
it takes to manage their cash flow more accurately.
• Payments Services
• Collections Services
• Liquidity Management
Comprehensive Payments Solution
Standard Chartered’s Payment Solutions can help to reduce the companies overall processing
costs – for domestic and global payments – saving the time and money while providing a
value-added service to their suppliers. The Banks comprehensive payment services will be
tailored to enhance the Customers accounts payable process. This will eliminate many
manual tasks involved in making payments, allowing the corporate and their staff to spend
more time focusing on their core business needs.
The Bank understands that most of the corporates effort in the payment cycle is directed
towards initiation; difficulties in the subsequent reconciliation process can jeopardize the
whole process. With Straight2Bank Channels the customer can now track the exact status of
each payment through timely reports that can be uploaded seamlessly into their company’s
system.
The Bank offers a full range of payment capabilities including:
Cross Border payments
• Telegraphic Transfers
• International Bank Cheques/ Drafts
Domestic payments
• Local Bank Cheques/ Drafts/ Cashiers Order
• Corporate Cheque
• Direct Credits - ACH/GIRO/Credit vouchers
• Local Bank Transfers (RTGS)
• Book Transfers (Account transfer between Standard Chartered branches)
• Payroll
Payments System Integration
Straight2Bank channels cater to different levels of customer payment sophistication,

including simple online transaction via Internet, bulk file payment via Internet or lease line,
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and the ability to send industry standard messages directly to the bank. Their in-country
specialists are available to help customize a solution that would enable the corporate to
manage their working capital in a more efficient manner.
Collections Services
Comprehensive receivables management solution
Standard Chartered understands that operating and sustaining a profitable business these days
is extremely tough. In an environment of constant changes and uncertainties, most businesses
face challenges of costs and efficiency. Key concerns include:
• Receivables Management - ensuring receivables are collected in an efficient and timely

manner to optimize utilization of funds.
• Risk Management - ensuring effective management of debtors to eliminate risk of returns

and losses caused by defaulters and delayed payments.
• Inventory Management - ensuring efficient and quick turnaround of inventory to

maximize returns.
• Cost Management - reducing interest costs through optimal utilization of funds.
Solution:
The Standard Chartered Collections Solution leverages the Bank's extensive regional
knowledge and widespread branch network across their key markets to specially tailor
solutions for the customers regional and local collection needs. This Collections Solution,
delivered through a standardized international platform, has the flexibility to cater to the
customer’s local needs, thus enabling them to meet their objectives of reducing costs and
increasing efficiency and profitability through better receivables and risk management.
The key components of the banks solution include the following:
• Extensive Clearing Network
• Guaranteed Credit
• Comprehensive MIS
• System Integration
• Outsourcing of Collection
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Extensive Clearing Network
The Banks extensive branch network, complemented by their correspondent banks' network,
provides the customers with a wide coverage of clearing locations to ensure they get the
benefit of early availability of funds. This is further enhanced by the customer’s cheque
purchase and guaranteed credit services.
Guaranteed Credit
To help the corporate manage their cash inflow from their accounts receivable more
efficiently, Standard Chartered can arrange for guaranteed (subject to prior agreement) credit
to their account for cheque collections. The customers local and foreign currency cheques
will be credited to their account on a fixed date even if the Bank is not in receipt of the funds
from the clearing house or correspondent bank.
Comprehensive MIS
The Bank understand the importance of timely and accurate information regarding accounts
receivable to help the corporate effectively manage their receivables and debtors, and
minimize losses caused by delayed receipts and defaults. The Corporate can also better
manage their buyers' requirements and improve their inventory management.
Based on the customer’s choice of Straight2Bank channels, multiple, detailed reports are
delivered to them via email, fax, Straight2Bannk Access (Host-To-Host channel) or
Straight2Bank Web (Internet Banking Channel). These reports are tailored to the customer’s
needs and provide details such as invoice number, drawer name, customer reference number,
debtor code, special narration, remarks and any other information the customer have
requested for. Here are some of the comprehensive reports the Standard Chartered solution
provides the customer with:
• Activity Reports e.g. information on collections activity for the period
• Deposit Reconciliation Reports e.g. deposit confirmation
• Return and Reversals Report e.g. information on cheques returned
• Drawer Summary Report e.g. information on drawers
The Standard Chartered collection platform can be integrated with the corporates accounts
receivable system to enable auto reconciliation for their accounts receivable. They also get
fully reconciled receivables files with invoice details and amounts matched against receipts.
In addition, Straight2Bank Web (Internet Banking Channel) can also be used as an electronic
channel to transmit collection information such as DDI (direct debit initiation) files or invoice
number (Account Receivable) details to the Bank. The bank also provide the option of
transmission of files and MIS through Straight2Bannk Access (Host-To-Host channel).
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Outsourcing of Collections
Standard Chartered supports the corporates complete collection cycle. These services cover:
• Courier pick-up service, which is available for cheques from the Corporates office, dealers'
and distributors' offices, from PO Boxes etc.
• Clearing of instruments whether local or foreign currency through the clearing houses,
directly by Standard Chartered or through their correspondent bank network.
• Electronic collection services through the ACH.
• Data capture of information.
• Reconciliation activities.
Types of Collections
The Bank provides collection services for:
• Local currency cheques
• Foreign currency cheques
• Lock box services – Retail and Wholesale
• Direct Debits
• Credit Card Collections
• Inward Telegraphic Transfers
8. CITI BANK
If the Corporates are looking to streamline their business processes to realize greater
operational efficiencies and to manage their company's working capital more effectively,
Citigroup has the solutions.
The banks Cash Management products include:
• Web-enabled payment and receivables solutions
• Vendor financing
• Commercial card solutions
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Payables
Citi bank ACH Citigroup has been providing high-quality Automated Clearing House (ACH)
Payment and Receivables Solutions to their clients for over two decades. They offer a full
range of solutions that include the collection of consumer payments via the telephone,
Internet or check-to-ACH conversion, as well as payments to employees and vendors.
ACH can streamline the customer’s payments and receivables processes for:
• Consumer-initiated bill payments and pre-authorized debits
• Direct deposit of payroll, pension payments and T&E reimbursements
• Vendor payments
• Mortgage and tax payments
• Dividend payments
• And a growing number of other ACH-facilitated applications
The use of ACH to make payments to employees and vendors, will benefit the company
from:
• Cost savings
• Improved account reconciliation
• Resource re-deployment
By using ACH to receive payments from customers, the company will benefit from:
• Timely collection and cash flow
• Reduced processing costs
• Improved customer satisfaction
Citibank® Funds Transfer
Citibank® Funds Transfers is the ideal tool to remit payments that need same-day execution
and settlement, such as investments, treasury payments, foreign exchange settlements and
third-party settlements. The company gain same-day movement of funds and immediate
availability, with payments processed by our Funds Transfer Network, then executed via
CHIPS, FedWire or Book-to-Book transfer.
Citibank® Integrated Payments Service
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The corporate can operate all over the world, making payments of all types—which can be
complex and time-consuming. The bank provides greater efficiency and control with a single
solution that meets the customers global and local payment needs. Citibank® Integrated
Payments Service offers information management and consistency across all the customers
locations and processes—from pricing and transacting through reporting, customer service
and billing.
It is basically designed for organizations looking to improve efficiency through

standardization, automation and centralization of their payment operations, Citibank
Integrated Payments Service provides:
• Cost savings. Minimize the costs by streamlining payment processes, outsourcing noncore
payment activities, and standardizing reporting.
• Convenience. Meet regional and country-specific payment requirements with a single

solution.
• Efficiency. Standardize transaction initiation and reporting options for consistency across
all the corporate locations with Citigroup's advanced technology and local and global
network.
• Flexibility. Choose from a range of payment options, including funds transfers and cross
border checks. The corporate can also indicate specific payment needs for particular regions
and countries.
• Versatility. The bank also facilitate electronic and paper transactions in more than 100
currencies with a comprehensive package of payment products and services that are tailored
to the way the corporate do business.
World Link® Payment Services
For over 20 years, the WorldLink solution has been successfully enabling their clients to
issue payments in more than 135 currencies, right from their offices via a single window—
without having to maintain local currency accounts. WorldLink Payment Services is a
complete global transaction solution that makes cross-border payments simple and secure.
Receivables
Citibank® Customer Initiated Payments enables the company to offer their customers Web
and telephone payment capabilities, integrated with optional online bill presentment. Citi
Banks integrated solution enables the company to offer their customers:
• An Internet payment application, hosted on the Citibank Customer Initiated Payments

system and branded to appear consistent with the companies own Web site, that provides one-
time or automated recurring payment initiation
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• A touch-tone telephone (IVR) payment application for one-time payment initiation
• A customer service console to enable payment initiation by an operator
The system can provide the customers summary invoice information such as the amount due,
due date or other pertinent information based on data that the company provides.
Alternatively, the bank can present the companies invoice electronically on the Citibank
Customer Initiated Payments Web site, with integrated payment capabilities. The system’s
flexibility gives the choice to include bill presentment and payment, or payment only.
Payments can be made using ACH debits, credit cards, or debit cards. The company can
choose which access channels (Web, IVR, or voice telephone) methods and payment methods
they wish to offer. Full remittance detail is provided to company daily and can be combined
with remittance data from other Citigroup receivables streams, including our Lockbox or
Electronic Receivables Services.
Citibank® Electronic Check Deposit (ECD)
The U.S. Check Clearing for the 21st Century Act ("Check 21") gives the reprint of a scanned
check legal equivalence to the original paper check. That opens up opportunities for the
Corporates to enjoy more efficient, more cost-effective check deposits. Electronic Check
Deposit (ECD) service is the most effective way for the corporate to take full advantage of
Check 21. With ECD, the corporate can scan checks in their own office, and then
electronically transmit the images to Citigroup—eliminating the hassle of overnight paper
checks to the U.S. or physically preparing them and delivering them to the bank.
Liquidity and investments
To help the corporate optimize return on excess operating balances and minimize time spent
on execution, Citigroup offers an array of integrated investment options through multiple
channels. Investment transactions may be completely automated or actively initiated through
our desks and online investment options.
The investment options the corporate select will depend upon their organization’s operating
footprint and currencies—as well as on the company’s investment strategy and objectives in
terms of risk, return, convenience and timing.
A key offering within Citigroup’s Global Liquidity and Investments product suite, Notional
Pooling is ideal for corporations with decentralized operational structures that want to
preserve the autonomy of their subsidiaries and accounts. Pool participant accounts in a single
currency are aggregated for interest compensation purposes. Funds are not physically moved,
but are instead notionally combined. There is no commingling of funds, and the integrity of
the individual account position is maintained. Net excess pool positions both in the U.S. and
offshore may be fully invested using one of their Automated Investments solutions.
Direct Debit
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Citigroup offers two services that can enable the corporate to offer automated direct debits to
their customers as a convenient payment method. An automated direct debit program can
reduce their transaction costs, improve accounting efficiency, and accelerate their receivables
cash flows.
Citibank Direct Debit Services
Citibank® Direct Debit Services meets the needs of clients who manage their direct debit
program in house. They can collect authorizations and bank account information from their
customers, and subsequently send instructions to Citigroup to debit their customers' accounts
via ACH, in order to settle their outstanding obligations.
Conclusions from Competitive Analysis
1. All the banks provide products that are of a similar nature
2. The market is highly competitive in pricing as banks have service charges similar to
each other
3. The network of government banks is the highest with Bank of India having the largest
number of branches for CMS
4. Foreign Banks have some products that are not offered by other banks in the market
5. Most of the Banks are now looking to convert each of their branches into CMS
operating Branches
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6. Banks are now providing CMS as an add on facility with other facilities provided by a
Current Accounts
66
SWOT Analysis
Strength
1. Largest Private Bank in India
2. Established Customer Relations
3. High Network Coverage
4. Value added Product range
5. Excellent Web Interface and Internet Facility
6. CMS software integrated with ERP
7. UCC as a constant revenue generator
Weakness
1. Interface Between Finnacle and CMS software not available
2. Sustainability of Volume
3. No dedicated Bills Collection Facility
Opportunities
1. Scope for Cash collections
2. Emphasis on Post Dated Cheque collection
3. Network can be improved by more tie ups
a. Eg. HSBC-5000, Axis Bank-5000, BOI- More than 5000
4. New Target segments can be identified as market still untapped
Threats
1. Increased competition in the market
2. Bank does not cover all the products offered by the market in its portfolio
3. Improving technology needs constant up gradation of products
Analysis of Cheque Clearing

67
Cheque clearing data for the past three years was obtained from RBI. The data was analyzed
to identify trends in the MICR cheque clearing as well as non MICR cheque clearing. A
comparison of paper transactions with electronic transactions was also done. It was done to
understand the growing influence of electronic transactions.
MICR Clearing
Trends in volume and Value
Percentage Change in Volume and Value
1. MICR clearing sees a 5% decrease in volume whereas a 3% decrease in volume in the

year 2008-09
2. There is a decreasing trend observed in the percentage change in both volume and
value
Non MICR Clearing
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Trends in Volume and Value
1. Non MICR clearing showed a 1.7% decrease in volume but an increase of 10.4% in
value
2. Value has shown an increasing trend despite a drop in the year 2006-07
Retail Electronic Clearing
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1. Retail Electronic Clearing sees a increase of 28% in volume but 57% decrease in
value
2. There is a decreasing trend in the percentage change in value
EFT/NEFT
70
1. EFT/NEFT sees a 141.5% increase in volume and a 79.6% increase in value
2. It shows an increasing trend in both volume and value over the period of analysis
Conclusions from Analysis of Cheque Clearing
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1. Cheque is still being predominantly used as an important instrument of cashless paper
based mode of payment
2. MICR clearing witnessed a decline of 5% in volume and 3% in value. Non MICR
clearing on the other hand witnessed a 2% decline in volume but a 10% increase in
Value
3. EFT/NEFT witnessed an increase of more than 100% in volume and 79% increase in
value
4. Even though the volume of transactions is dominated by paper clearing, Electronic
Transactions have shown a steady rise in Value
5. As Electronic Transactions are on the rise, its use should be encouraged
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Questionnaire Design
To understand the needs of the market a questionnaire is designed. The questionnaire helps us to
understand the current position of the Cash Management Services industry. It also helps us to
understand what the customer expects of the services as the world is changing very rapidly.
The questionnaire was designed for two purposes:
1. To understand the position of the Cash Management Services industry
2. To get a feedback from ICICI Banks existing customers regarding services

offered.
For this purpose two questionnaires are designed. One for the banks existing customers, and one for
firms who are not banks customers but use or can use CMS.
Questionnaire for ICICI Bank Customers
Dear Customer
We at ICICI are conducting a survey to understand the needs of our customers so that we can
help them by serving them better. Please take some time out to fill out this questionnaire.
Personal Information:
Name:
Age: Less than 25 years 25-40 years More than 40 years
Sex: Male Female
Company Name:
Designation:
1. What is the annual turnover of your company?
0-50 crore 50-100 crore more than 100 crore
2. Which of the following does your company belong to?
Trading Manufacturing Services
3. Which sector does your company belong?
Retail Media and Entertainment Pharmaceutical Hospitality
If others please specify
_______________________________________________________
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4. How many employees are employed with the company?
0-50 50-10 100-150 More than 150
5. In a week, how often does the company interact with the bank?
1-3 times 3-6 times More than 6 times
6. In a month, how often does the company visit an ICICI Bank Branch?
1-3 times 3-6 times More than 6 times
7. On the company’s behalf, who visits the bank branch for managing transactions?
Name:
Sex: Male Female
Designation:
8. Does the company use internet banking facilities?
Yes No
9. If yes to the above question then for what purposes?
Payments Bill Settlements Cheque Writing/ Disbursing
_______________________________________________________
10. How do you receive payments for your receivables?
Cash Cheque Demand Draft
_______________________________________________________
11. How do you make payments for your payables?
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_______________________________________________________
12. Do you use Credit Card facilities for payments?
Yes No
13. Do you operate all your transactions from a centralized account?
Yes No
14. If yes then is the centralized account with ICICI Bank?
a. Yes No
15. If no to the above question then please mention which bank
_______________________________________________________
16. Do you use a centralized Disbursement Scheme for paying internal customers
a. Yes No
17. Which ICICI CMS product do you use?
Local cheque collections
Upcountry cheque collections
Cash collection
Internet Payment
Payable at Par cheques
All of the above
18. After using CMS, rate how useful CMS is to your business?
Very Useful
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Useful
Not very Useful
a. Not useful
19. Do you use some other facilities provided by ICICI?
If yes then please specify:
_____________________________________________________________________
20. In the next 3-5 years how do you expect your business to change? How will we have
to respond for you to remain our customer and grow our business together and what
do we need to do to support you in this process?
_____________________________________________________________________
_____________________________________________________________________
Please tick the appropriate box to indicate your degree of satisfaction.
Where: 1 = Excellent, 2 = Good, 3 = Satisfactory, 4 = Poor
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TOPIC 1 2 3 4
RESPONSIVENESS:
21. How do you rate our responsiveness for your cheque and
cash collections/ payments?
22. How do you rate our responsiveness for your internet
transactions?
23. How do you rate our responsiveness for answering and
solving your queries?
PROFESSIONALISM:
1. How do you rate our professionalism of the bank in dealing
with your transactions?
2. How do you rate the professionalism of our relationship
manager in dealing with your company?
3. How do you rate the professionalism of the bank in dealing
with your problems and queries?
TECHNICAL SUPPORT:
1. How do you rate the user friendliness of the internet based
products that ICICI Bank offers?
2. How do you rate the usefulness of the technical support?
3. How do you rate the efficiency of the technical support?
PRODUCT QUALITY:
1. How do you rate our products and services?
2. How do you rate our internet banking facilities?
3. How do you are the usefulness of our products in your
business?
Questionnaire for Companies
Dear Customer
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We at ICICI Bank are conducting a survey to understand the needs of our customers so that
we can help them by serving them better. Please take some time out to fill out this
questionnaire.
Personal Information:
Name:
Age: Less than 25 years 25-40 years More than 40 years
Sex: Male Female
Company Name:
Designation:
3. Which sector does your company belong?
Retail Media and Entertainment Pharmaceutical Hospitality
_______________________________________________________
0-50 50-10 100-150 More than 150

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_______________________________________________________
_______________________________________________________
Yes No
8. Are you aware of Electronic Fund Transfers (EFT)?
a. Yes No
9. If yes to the above question, then do you use EFT for transactions?
a. Yes No
10. Have you heard of Cash Management Services offered by banks?
a. Yes No
11. If yes to the above question, then what products are you aware of?
Please specify
_______________________________________________________
12. Do you use Cash Management Services?
a. Yes No
13. If yes to the above question, then which products do you use?
Please specify
_______________________________________________________
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14. Which Banks Cash Management Services (CMS) do you use?
ICICI Bank
State Bank of India
Axis Bank
Standard and Chartered Bank
Deutsche Bank
Corporation Bank
_______________________________________________________
15. For what purpose do you use CMS?
a. Payables Management
b. Receivables Management
c. Liquidity Management
16. Rate the importance of the above mentioned products to your business
1. Very Important 2. Important 3. Not very Important 4. Not important
Product 1 2 3 4
Payment Products
Collection Products
Liquidity Management
Products
17. Do you use CMS to serve your internal customers?
a. Yes No
Yes No
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Very Useful
Useful
Not very Useful
a. Not useful
20. When using CMS, do you find the need for newer products?
a. Yes No
21. If yes to the above question, then in which of the following does the need arise?
a. Payables Management Products
b. Receivables Management Products
c. Liquidity Management Products
22. Do you find the CMS products customized to suit your company’s needs?
a. Yes No
23. If no to the above question, then in what products will you need some customization?
24. Along with CMS, would you require other facilities to optimize your business
transactions?
a. Yes No
25. If yes to the above question, then what other facilities would you require. Please
specify?
_____________________________________________________________________
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_____________________________________________________________________
26. In the next 3-5 years how do you expect your business to change? How will Cash
Management Services play a part in your growth?
_____________________________________________________________________
_____________________________________________________________________
SURVEY REPORT
A market survey was conducted to understand the position of the Cash Management Services
Market. The questionnaire was administered on non ICICI bank customers. The survey
provided for understanding of the how the CMS market is viewed by the customer today. It
also provided for a feedback on the various products offered by competitors. It thus helped in
competitor’s analysis.
The questionnaire was administered to a sample of 25 companies. The companies chosen as

samples were from different sectors to make sure the responses from all major industries are
covered.
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Limitations of the Survey
1. The time period of the survey was limited due to time constraints of the project
duration
2. The sample size was limited by the time constraints of the project
3. The Results of the survey may differ as the sample size was a small representation of
a huge population
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0-50 50-10 100-150 More than 150
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Analysis
The above question helped us gather the company profile of the sample. As we can see from
the above response most of the companies had a turnover of more than 100 crore. More than
50% of the companies have more than 150 employees.
72% of the respondents belonged to the manufacturing sector. The need for CMS is the
highest in the manufacturing sector. This is the reason for which most of the Manufacturing
sector companies were chosen as samples. The Services industry also has started using CMS.
Thus even the services industry was included as samples for the survey.
85
Analysis
The questions were aimed to understand how the sample companies maintained their
receivables and payables. As we can see from the responses cheque still remains the most
preferred way to settle management of receivables and payables.
Demand draft is also a popular mode. Thus Paper Based settlements is the most preferred
mode of settlements. Cash transactions and Electronic transactions do not form a significant
mode of settlements yet.
Yes No
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Analysis
The above question was aimed to see the popularity of Card based payments while making
settlements. According to RBI data, Credit Card payments showed a significant growth in the
last year. The question tried to check if the same was seen for the CMS market.
As we can see from the above response, most of the companies in the sample did not use
Credit card for settlements of payables and receivables. It is interesting to note that the
companies having turnover of less than 50 crore used Credit Card settlements. Most of the
resopndents who answered in the affirmative were proprietor companies. Thus popularity of
Credit Card settlements is not high for the companies using CMS.
7. Are you aware of Electronic Fund Transfers (EFT)?
a. Yes No
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8. If yes to the above question, then do you use EFT for transactions?
a. Yes No
Analysis
The above question was aimed to check the awareness of Electronic Transactions for
settlements of payables and receivables. The second part of the question tested if the
awareness of EFT resluted in the use of EFT for settlement of payables and receivables.
As we can see from the responses, most of the companies in the samples were aware of
Electronic Fund Transfers. The companies not aware were companies having turnover of less
than 50 crore. It is interesting to note that although most of the companies were aware of
EFT, only 16% used EFT for settlements. Thus scope for use of EFT is high as the sample
contained 68% of companies having turnover of more than 100 crore.
9. Have you heard of Cash Management Services offered by banks?
a. Yes No
88
10. Do you use Cash Management Services?
a. Yes No
Analysis
The above question was aimed to check the awareness of CMS offered by banks. The second
part of the question tested if that awareness resulted in the use of CMS
As we can see from the responses, most of the companies in the samples were aware of CMS
offered by banks. The companies not aware were the companies having turnover of less than
50 crore. It is interesting to note that along with the awareness, the use of CMS offered by
banks was alos very high. This shows the popularity of CMS and the saturation in the CMS
market in India.
11. Which Banks Cash Management Services (CMS) do you use?
ICICI Bank
State Bank of India

89
Axis Bank
Standard and Chartered Bank
Deutsche Bank
Analysis
The above question was aimed to understand the services used by the sample companies. It
was aimed to understand competitors reach in the CMS market. None of the companies in the
sample were ICICI Bank cutomers
As we can see from the above responses HDFC Bank emerges as the most popular bank
amongst the samples. Bank of India comes in second with 28% of the samples using its CMS
services. It is interesting to note that even Government banks are popular among companies
using CMS.
12. For what purpose do you use CMS?
a. Payables Management
b. Receivables Management
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c. Liquidity Management
Analysis
The question was aimed to understand the purpose for which the companies used Cash
Management Services. The question serves as a feedback question as it helps to undersatnd
the needs of the companies. it can help when the bank decides to launch a new prroduct in the
market.
As we can see from the above respones, Receivables management serves as the most
important purpose to use CMS offered by banks . It is interesting to note that Liquidity
management includes Working Capital Management and Short term loans to satisfy working
capital needs of the company
13. Rate the importance of the above mentioned products to your business
2. Very Important 2. Important 3. Not very Important 4. Not important
Product 1 2 3 4
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Payment Products
Collection Products
Liquidity Management
Products
Analysis
The above question aimed to understand the importance of the different types of settlements.
It also serves as a feedback question as it allows deciding which new product to look at
depending on the importance given by the customers
As we can from the above responses, payment products and collection products were
important to most of the companies. Thus these products are most important to companies
using CMS offered by banks. It is interesting to note that most of the companies do not find
92
Liquidity Management products important to their business. It can be attributed to lack of
awareness about such products in the market.
14. Do you use CMS to serve your internal customers?
a. Yes No
Yes No
Analysis
The above questions aimed to check the awareness of other features offered by banks along
with CMS. A centralized account is one such feature along with central disbursement for
employees
As we can see from the above responses, most of the companies did not use the features
provided by CMS. Thus it shows that companies prefer general products offered under Cash
Management Services. There is a huge scope to promote such services to attract new and
retain existing customers.
93
Very Useful
Useful
Not very Useful
a. Not useful
Analysis
The above question aims to check the usefulness of CMS offered by banks. It also acts as a
feedback question as it helps understand the satisfaction levels of customers using CMS.
As we can see from the above response, more than 90% of the companies using CMS find it
useful. It is very interesting to note that only 6% of the companies using CMS find it not
useful. This shows that the sample companies find CMS useful to their business. Satisfaction
levels with CMS can also be safely concluded to be high
94
17. When using CMS, do you find the need for newer products?
a. Yes No
18. If yes to the above question, then in which of the following does the need arise?
Analysis
The above questions are feedback questions. They aim to understand if there is a need for
newer products in the CMS market. It also tries to find out in which product do the companies
feel the need for a new product
As we can see from the above responses, most of the companies feel the need for newer
products in the market. It shows the saturation in the market with regards to the existing
products. It is interesting to note that most of the companies feel the need for newer products
for Liquidity Management. Even though Payables and Receivables Management products are
more important to them, they feel the need for new products in Liquidity Management.
95
19. Do you find the CMS products customized to suit your company’s needs?
a. Yes No
20. If no to the above question, then in what products will you need some customization?
Analysis
The above questions are feedback questions. They aim to understand the level of
customisation in products offered by banks. It helps to understand if competitors offer
customised products to customers
As we can see from the above responses, most of the companies feel the need for
customization for products in the market. It shows the saturation in the market with regards to
the customization level of existing products. It is interesting to note that most of the
companies feel the need for customization for products in Liquidity Management. Even
96
though Payables and Receivables Management products are more important to them, they
feel the need customization in Liquidity Management products.
21. Along with CMS, would you require other facilities to optimize your business
transactions?
a. Yes No
Analysis
The above question is a feedback question. It aims to understand if there is a need for other
facilities for products in the CMS market. It also helps to understand the satisfaction levels of
the customers with the existing services provided under CMS by banks.
As we can see from the above responses, most of the companies feel the need for other
facilities along with the existing products in the market. It shows the saturation in the market
with regards to the service provided along with the existing products. It shows that there is a
scope for improvement in the service provided by banks.
97
Conclusions from the Survey
1. Cheque is still a major instrument to settle payables and receivables. Thus transactions
are dominated by paper instruments
2. Credit Card is used for settlements by smaller companies.
3. Awareness about EFT is high but it does not translate into usage.
4. Awareness and usage of Cash Management Services is high
5. Companies find Cash Management Services as a useful tool to enhance their business
efficiency
6. The main purpose for companies to use Cash Management Services is to manage their
receivables
7. Cash Management Services is mostly used to manage receivables and payables and
not for processes internal to the company
8. Collection Products and Payment Products are the most important products in the
market
9. Awareness about Centralized disbursement product is low as not many companies use
this facility.
10. Companies feel the need for newer products in the market
11. Awareness about Liquidity Management is not too high, but companies feel the need
for products in that segment
12. Cash Management Services offered by banks are customized, but a further need is
felt. Especially in the Liquidity Management Products segment
13. Cash Management Services is not looked upon as a standalone service. Companies
felt the need for other services along with CMS
98
Conclusion
The Cash Management Services Market in India is huge with a lot of potential to grow. With
almost all the industries requiring Cash Management Services product in some form or the
other, the scope for growth is huge. As Cash management is constantly changing to meet the
needs of the corporate treasurer, the challenge for both corporation and provider is to keep up
with developments, technology, changing regulations and fitting these in with normal
business. A changing regulatory environment, new technology and mergers that expand the
scope of traditional banking are redefining the traditional treasury management paradigm for
both banks and corporations. Electronic commerce is evolving far beyond simply ordering
goods online or buyer-to supplier commerce.
In a vast country like India Providing Cash Management Services do poses a challenge to the
Cash Manager as well as the banks. Considering the present Indian scenario, where Cheques
are the basic form of payment and cheque clearing takes a long time, cash management
services need to devise innovative methods and means to expedite the clearing to benefit the
corporate customer. As the Indian economy becoming an open market economy, residents
may maintain accounts in other countries and non-residents may hold accounts in India. As a
result, Indian treasurers may often find themselves managing cash across geographies and
time zones. In India the transaction types run from the classic paper cheque to the latest
Internet initiated electronic payment.
Corporations initiate and receive paper-based transactions, as well as high value and low
value electronic transactions on a daily basis. Expectations from new services may not
eliminate or fully replace the older traditional services. Change will be gradual but, probably,
it will be firm. Fee structures for cash management services in India vary from bank to bank
and also from customer to customer. Many banks price the services based upon the overall
relationship, especially for multiple product solutions.
As Indian banks become more consultative and total solution oriented rather than product-
driven, pricing will become even more customized. Corporate treasurers will consider the
amount they can save on banking fees and the level of efficiency in their departments as a
sequel to the new cash management services. After they have negotiated the best possible
price, treasurers then focus on the return on excess balances. They are no longer content to
leave large balances in return for no fees charged. Treasurers will look for true partnership
with banks to build systems that will take them into future.
99
Recommendations
1. Cash Management Services should not be a standalone service provided by banks. It
should be promoted as a value added service along with other services offered to
corporates
2. Credit Card Payments have shown an increase in value and volume. They should be
incorporated as a new product in Cash Management Services product bouquet
3. Electronic Transactions have increased in popularity. They should be emphasized

more for transactions.
4. Service customization should be looked into as prices and product features are similar
across industries.
5. Identifying the correct target segment is also a must. The bigger corporate already use
CMS, so it is necessary to identify newer businesses to sustain business growth
6. Foreign currency cheques deployment should be looked into as only the foreign banks
provide that in the country. It will help in targeting export oriented customers.
7. Banks should try and incorporate all services under one current account. They should
target customers to get such accounts. That will ensure business for the banks and
ease of operations for the customer
8. Companies should be encouraged to use CMS for its internal processes. Centralized
Disbursement should be encouraged as a product
9. The market needs new products. Different combinations of products should be looked
into to attract new customers.
10. With increasing competition, customer service becomes of paramount importance.

Retention of customers should be the main target of relationship managers
11. Cash Management Services should be coupled with Working Capital Management
Products to make it attractive to customers in the manufacturing and export business
100
References
1. ICICI Bank Training Manual
2. www. Wikipedia.org
3. www. Treasury-management.com
4. www.icicibank.com
5. www.business.mapsofindia.com
6. Websites for HDFC Bank, Axis Bank, Corporation Bank, CitiBank, Standard and
Chartered Bank , Bank of India, HSBC Bank, Canara Bank
101

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Project on:

The Cash Management Services Market in India

I, Kamal Purohit, student of N. L. Dalmia Institute of Management Studies &

project on “The Cash Management Services Market in India” in the academic

I thank you all!!

2. Introduction to Cash Management Services 6

3. Benefits of Cash Management 7

4. Cash Management Services generally offered 8

5. Cash Management Services- Indian Scenario 11

6. Industry Analysis and target segments 13

7. Cash Management Services at ICICI Bank 22

10. SWOT Analysis 67

11. Analysis of Cheque Clearing 68

12. Questionnaire Design 73

13. Survey Report 83

15. Recommendations 100

Manage your cash flow and liquidity-Effectively and Efficiently

Cash Management is Efficient Management of cash (Outflows/Inflows) to improve liquidity

2. Eliminating idle cash balances.

3. Ensuring timely deposit of collections.

4. Monitoring exposure and reducing risks

1. Account Reconcilement Services: Balancing a checkbook can be a difficult process

10. Zero Balance Accounting: It can be thought of as somewhat of a hack. Companies

Introduction of a Centralized Funds Management System, Securities Services System, Real

Industry Analysis and Target Segments

1. Major Players in the Industry

2. Features of the Industry on the whole

3. Need for Cash Management

The industry analyzed and the findings are as shown below:

The various players in this industry are:

 Larsen & Toubro: Annual turnover of Rs 339263 million

 Punj Llyod: Annual turnover of Rs 68879 million

 JP Associate: Annual turnover of Rs 57641 million

 IVRCL Infra : Annual turnover of Rs 49830 million

 NagarCons : Annual turnover of Rs 41514 million

 Experiencing growth to due to increase in demand.

 Not too dependent on government policies.

 Has government support as it wants more development.

 Eg: DLF tie up with DDA

 Lot of diversification opportunities possible

 Eg: Unitech investing in hotel construction

 It is a cyclical industry as demand generally depends on the state of the

Cash Management Services need:

 The industry can have Cash Management Services

 These companies have multiple collection issues once the project is

The various players in the industry are:

 IHC Ltd: Annual turnover of Rs 16195 million

 EIH : Annual turnover of Rs 8886 million

 Oberoi Group: Annual turnover of Rs 2147 million

 Hotel Leela Venture: Annual turnover of Rs 4522 million

 Asian Hotels Ltd: Annual turnover of Rs 6415 million

 The Hospitality industry is witnessing a boom due to increased

 Not too dependent on government policies.

 Has government support as it is encouraging tourism through various

 Price of service is dependent on many factors which make it a price

 It is a cyclical industry as demand generally depends on the state of the

Cash Management Services need:

 The industry can have Cash Management Services (CMS)

 For a particular hotel payables can be managed through auto clearing

 Receivables from customers can be managed through a concentration

 Every hotel can have a centralized MIS to maintain inventory levels

 The payments made and received can be maintained using auto

The various players in this industry are: