Syllabus of Basics of Lending PBS - 108: Unit 1
Syllabus of Basics of Lending PBS - 108: Unit 1
Syllabus of Basics of Lending PBS - 108: Unit 1
PBS - 108
UNIT 1 - Principles of lending -Safety, security, liquidity, purpose, profitability, Cannons of
sound financing- 5 C's of lending - Character, Capacity, Capital, Condition and Collateral. Types
of borrowers, Wholesale versus Retail Lending, Broad sources of finance, Needs of business
entities, Working capital and term loans. Forms and features of lending- short-term and long-
term finance. Concept of security – unsecured and secured advances, Primary security and
collateral security. Fund-based and non-fund based credit in terms of cash outflows 6
UNIT 2 - Types of advances - Working Capital Finance viz: Cash Credit, Overdrafts , purchase &
discounting of bills, Packing Credit, etc, Bank Guarantees, Deferred Payment Guarantees, LCs,
etc. 6
UNIT 4 - Types of charges created on assets, Types of security and charge for various facilities.
Mortgage – registered and equitable. Pledge, hypothecation, assignment of debt. Perfection of
security – registration, filing, etc. Protection of security – insurance, inspection, monitoring.
Third party guarantee. Valuation of security 6
UNIT 5 - "Selection of clients: due diligence - evaluation of Promoters and Management team,
market enquiries, evaluation of security, Pricing of loans and returns on funds lent 3
UNIT 7- "PRIORITY SECTOR – CATEGORIES AND TARGETS / SUB-TARGETS - 1) Adjusted Net
Bank Credit, 2) Categories of advances under priority sector- Agricultural, Micro/Small
enterprises, Housing, Education and Weaker sections 3) Targets and Sub targets for
Scheduled commercial banks and foreign banks - AXIS approach on priority sector., Scale of
finance for Crop loans", "Micro and Small Enterprises (Manufacturing and Services). Fair
practices code for lenders, Impact of technology on banking sector - Introduction to Digital
Lending" 4