Part-2

To study about the advance

product exploration (House
Loan) of The Umreth Urban
Cooperative Bank.

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6. Introduction of Product

Now a day not all the people have the capacity to fulfill their requirement by their own
earning, that’s why they need help from others. For this so many government & private sector
bank provide them money to fulfill their requirement, that’s call the Advance Product (loan
product) of the bank. All the banks have so many different types of advance product as per
the requirement of the people or customers. In Umreth also there are so many banks those
provide loan to the people for different causes.

Types of Advance Product

 Home Loan
 Car Loan
 Personal Loan
 Agriculture Loan

Now a day a large no. of people are taking loan form different banks. It helps people to
fulfill their need and it really easy to repayment the loan amount with a longer repayment
period.

7. Background of study
This article explains the housing loan schemes offered by banks in order to give a enhance
to the housing scenario in India and to narrow down the margin between the housing
demand and the availability of houses, The National Housing Bank was set up in the year
1988. This was done by keeping in mind that a home seeker though does have a desire for
a house but lacks the resources for construction or buying.

India have been serving the people for around three decades and providing various housing
loan schemes according to the customers various needs at attractive and reasonable interest
rates.

In December 2006 Fulbag Singh and Reema Sharma had studied about the housing finance
in India. Housing is the one of the basic needs of life, always remain on top priority of any
person economy, government and society large. In India majority of people lives in slum
and shelters in rural areas. From the last decade, the government of India has been
continuously trying to strengthen the housing sector by introducing various housing loan
schemes for rural and urban population

8. History:

Home loans came into widespread use in the United States in the boom years of the late
1800s. Since the average person usually cannot afford to pay cash for something as

25
expensive as a home, lenders began offering loans for the difference between the purchase
price of a home and the cash down payment supplied by the buyer. These loans were
interest-only loans of between five and 10 years that were due in full at the end of the loan
term. Homeowners would refinance the loan at the end of each term or save up enough
cash to pay off the loan in the meantime. The Great Depression and its resulting
foreclosures demanded a move to the modern amortized mortgage, which configures
payments into both principal and interest portions. These 15- to 30-year loans pay off the
home by the end of the loan term.

9. Significance:
Without home loans, most Americans could not afford to buy a home. The housing sector
and related industries are a large share of the U.S. gross domestic product (GDP).
According to the National Association of Home Builders, the housing industry as a whole
contributes about 17 percent to 18 percent of the nation’s GDP. In fact, housing was
largely responsible for the strong economic state of the U.S. throughout the early to mid-
2000s and disguised an essentially weak economy, according to an article by MSN
Money’s Bill Fleckenstein..

10. Home Loan Process & various steps involved

There are various steps involved in getting a Home Loan from selecting your property to
filling up the loan application. Following are the various stages in Home Loan:
The first step involved in the process is to find your property which is followed by the
verification of property documents, post that the documents are examined &
simultaneously you can start searching for the lender who can offer the BEST Home Loan
Deal after checking your eligibility criteria.

 Know the Home Loan Eligibility: Banks offer the loan amount only after
checking your profile & based on various eligibility criteria’s like age, income &
salary banks lend you the money.

 Select the Best Home Loan after evaluation: Comparing home loan interest rates
is the primary feature in the home loan selection, however other fees & charges like
Application fees, processing fees, legal charges should not be neglected when
comparing various loan offers. To check the interest rates & other charges incurred
by various banks, Deal4Loans has brought in a Home Loan Comparison Chart
across various Banks.

 Applying for the Loan: After you have selected your lender, you have to fill in the
application form wherein the lender requires complete information about your
financial assets & liabilities; other personal & professional details together with the
property details & its costs.

 Documentation & Verification Process: You are required to submit the

necessary documents to the bank which will be verified together with the details
in the application.

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  Credit & default check: Bank checks out the borrower’s loan eligibility (through
repayment capacity) & the amount of loan is confirmed. The borrower’s
repayment capacity is reached which is based on the income, salary, age,
experience & nature of business etc. Bank also checks credit history through the
Cibil Score which plays a critical role in deciding & approving your loan
application. Low Credit Score implies that the bank upfront rejects your
application on the basis of earlier credit defaults; on the other hand high credit
score gives a green signal to your application.

 Bank sanctions Loan & Offer letter to the borrower: After the credit appraisal
of the borrower bank decides the final amount & sanctions the loan, the bank
further sends an offer letter to the borrower which constitutes the details like rate
of interest, loan tenure & repayment options etc.

 Acceptance Copy to the Bank: The borrower needs to send an acceptance copy
to the bank after the borrower agrees with the terms & conditions in the offer
letter.

 Bank checks the legal documents: The bank further asks the legal documents of
property from the borrower to check its authenticity so as to keep them as a
security for the loan amount given. The next step involved is the valuation of the
property by the bank which determines the loan amount sanctioned by the bank.

 Signing of agreement & the loan disbursal: The borrower signs the loan
agreement & the bank disburses the loan amount.

11. Statement of problem

 ”To explore the possibilities of takeover of Home Loans in Umreth”

 To find out what kind of service provide by the competitors in advance product.

 How the products are helping the customer.

12. Research objectives

 First and foremost objective is to explore the possibilities of Housing loans in

Umreth.

 To maintain good relationship with old customer and try to find out their
satisfaction level.

 To know the competitor’s market share in Umreth.

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  To know what kind of services competitor gives to their customers.

 To make the customer aware of the benefits of the product and convince him to go
for The Umreth Urban Cooprative Bank’s Advance Product.

13. Research Design

13.1. Data Collection:

 Primary data collection – I collected primary data by visiting individual Houses

and meeting with individual persons. (Questioner filling)

13.2. Sample Size:

 Sample of 200 people was taken into study, and their data was collected.

13.3. Sampling Technique:

 To study the Project, a Simple Random Sampling technique is used.

13.4. Data Analysis

 Questioner analysis
 Graphs, charts are used for the purpose of analysis

13.5. Findings & conclusions:

 Questionnaire filled up.

 Interpretation of Collected Data
 Data analysis

14. Data analysis, findings and interpretations:

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1. On which bank you depend for your regular transaction?

Name Percentage
SBI 33%
BOB 12%
DENA BANK 2%
COOPRATIVE BANKS 47%

[Table-5 List of Regular Transection’s Bank]

List of Banks

0.33,

0.47,

0.12,

0.02,

SBI BOB DENA BANK COOPRATIVE BANKS

[Fig-7 List of Regular Transection’s Bank]

It has been observed that approximately 47% correspondents are using the service
of The Umreth Urban Cooperative Bank for their daily transaction, around 33%
of people are using the services of SBI for their transaction and 12% of people are
using BOB in Umreth. Only 2%people uses Dena Bank. It also shows that The
Umreth Urban Cooperative Bank have the highest market position in Umreth as
per my sample.

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2. Are you aware of products & services provided by The Umreth Urban
Cooperative Bank?

Yes 82%

No 18%

Total 100%

[Table-6 Awareness of Services of Bank]

Awareness of Services

0.18

Yes
NO

0.82

[Fig-8 Awareness of Services of Bank]

We can say that customers (around 82%) in Umreth have the idea about the
loan of The Umreth Urban Cooperative Bank they know about the all current
offers of Loans. We can say that 18% people have not the idea about the
product.

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3. If yes are you aware of the Home loans of The Umreth Urban Cooperative Bank?

Yes 92%

No 8%

Total 100%

[Table-7 Awareness of Home Loans of Bank]

Awareness of Home Loans

100%
92%
90%

80%

70%

60%
Axis Title

50%

40%

30%

20%

10% 8%

0%
Yes No
Axis Title

[Fig-9 Awareness of Home Loans of Bank]

It is clear that most of the people have the idea about the advance product of The
Umreth Urban Cooperative Bank. Almost all the 92% people who have the idea
about the advance product are the user of The Umreth Urban Cooperative Bank
product & service.

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4. Which bank you prefer for taking loans?

Name Percentage

SBI 11%

BOB 9%

DENA BANK 4%

COOPRATIVE BANKS 76%

[Table-8 Preferring Bank for Loan]

Preferring Bank for Loan

0.11,
0.09, 0.04,
SBI

BOB

DENA BANK
76%
COOPREATIVE BANKS

[Fig-10 Preferring Bank for Loan]

According to my sample size 76% of people prefer The Umreth Urban

Cooperative Bank for loan product, but some people prefer SBI (11%), DENA
BANK (4%), and BOB (9%) Banks for loan.

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5. What do you feel about the services providing by The Umreth Urban Cooprative
bank in Home Loan product?

Particular Percentage
Dissatisfy 4%

Moderate 52%

Satisfy 37%

Delighted 7%

[Table-9 Percentage of Satisfaction by Services]

Service Satisfaction
60%

52%
50%

40% 37%

30%

20%

10% 7%
4%

0%
Dissatisfy Moderate Satisfy Delighted

[Fig-11 Percentage of Satisfaction by Services]

From this it is clear that the service provide by The Umreth Urban Cooperative Bank
in its advance product is good in between the customer. All of them satisfy with the
product provide by The Umreth Urban Cooperative Bank. 52% of people said that
the service provide by The Umreth Urban Cooperative Bank is moderate, 37% of
people said that it is satisfactory. Only 4 % people are not satisfied.

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6. Which features you like most in Loan segments of The Umreth Urban Cooprative
bank?

Particular Percentage
Less Paper Work 3%

Attractive Interest Rate 35%

Transparency 20%

Fast Processing 2%

Longer Repayment Period 40%

[Table-10 Features of Home Loans]

Features of Home Loan

0.03

Less Paper Work

Attractive Interest Rate
Transperancy
0.4 0.35 Fast Processing
Longer Repayment Period

0.02
, 0.2

[Fig-12 Features of Home Loans]

Most of the people like the attractive interest rate & longer repayment period.
It’s easier for people to repay the whole loan amount with its interest with low
interest rate and with longer repayment period.

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15. Findings:

 From this project it is found that The Umreth Urban Cooperative Bank Home
Loans having the 1st place in the market at Umrth, but BOB, DENA BANK
and SBI also working hard for improving their market share in home loan
segment so they are the main threat or competitor.
 All of The Umreth Urban Cooperative Bank customers are satisfied with the
services provided by the bank.
 Many of these customers are well aware of The Umreth Urban Cooperative
Bank and their home loan product and satisfied with the low interest rate and
longer repayment period of the advance product.
 Most of the customers at Umreth feels that The Umreth Urban Cooperative
Bank really trying hard for improving their services.
 Approximately 43% of advance product users said that the service of The
Umreth Urban Cooperative Bank 52% in advance product is excellent.
 A response from customer care is so clear & good.
 Most customers are shifted from other bank’s advance product to The
Umreth Urban Cooperative Bank because of hidden charges, high interest
rate, less repayment period.

16. Suggestion & Recommendation:

 Customer awareness programme is required so that more people should attract

towards advance product (Loans).

 If there are any kind of hidden charges than that must disclose to customer before
giving loan to them.

 The Umreth Urban Cooperative Bank must take some steps so that customers can
get their loan in time. Like phone verification by customer care that one customer is
got their loan on time or not .It must be before a certain date so necessary steps can
be taken.

 The Umreth Urban Cooperative Bank should more concern about physical
verification rather than phone verification so it will avoid fraud or cheating.

 Advance product selling agents must not give any type of wrong information
regarding
Advance product.

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  For the better service new offers would be require.

 The Umreth Urban Cooperative Bank customer care should more concern about the
fastest settlement of customer problems.

 Before deducting or charging any monetary charge The Umreth Urban cooperative
bank must consult with customer.

 Agents should be trained, well educated & proper trained to convince the people
about different advance product.

 It is the duty of the bank to disclose all the material facts regarding advance
product, like interest charged, repayment period, other types of charges, etc.

 Special scheme should be implemented to encourage both customer and agents.

 The bank should increase the period for repayment of loan.

 The Umreth Urban Cooperative Bank should more focus on Retaining existing
customers.

 The Umreth Urban Cooperative Bank must focus on Segmentation based

on customer knowledge Product offering based on customer demand.

 The Umreth Urban Cooperative Bank must take feedbacks of customers

regarding features & services.

17. Conclusion

From the analysis part it can be conclude that customers have a good respond towards
The Umreth Urban Cooperative Bank advance products in Umreth. The Umreth Urban
Cooperative Bank is in 1st position having large number of customers & providing good
services to them. The bank has a wide customer base, so the bank should concentrate on
this to retain these customers.

In present scenario The Umreth Urban Cooperative Bank is the largest advance product
issuer in Umreth. Within a very short period of time the achievement made by The
Umreth Urban Cooperative Bank is excellent. It happens due to employee dedication
towards the organization,
To be the largest advance product issuer, The Umreth Urban Cooperative Bank should
focus on-
 Launch Innovative product

 Customized advance products

 Better customer services

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  Fastest customers problem solving techniques

 Customer retention

Apart from all the above, The Umreth Urban Cooperative Bank believe in providing good
customer services to their customers which is a key factor for success in future

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Annexure:

QUESTIONNNAIRE:
Declaration: it is purely for academic purpose and data given will not to passed to anyone
Please ( ) out for appropriate option.

A. Personal information:
…………………………………………………………………………………………
……………………………………………………………

1) Name:
………………………………………………………………………………………
………………………

2) Gender: (a) Male (b) Female

3) Age:(a)Below 30 (b)30 to 40
(c) 41 to 50 (d) Above 51

4) Marital Status:(a) Married

(b)Unmarried

5) Annual income: (a) Rs.50,000 to 1,00,000

(b) Rs. 1, 00,000 to Rs.1, 50,000
(c) Rs.1, 50,000 to 2, 00,000
(d) Above 2, 00,000

B. Questions:
…………………………………………………………………………………………
………………………………………………………….

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 1. On which bank you depend for your regular transaction?

A. SBI
B. BOB
C. DENA BANK
D. COOPRATIVE BANKS

2.Are you aware of products & services provided by The Umreth Urban Cooperative
Bank?

A. Yes
B. No

3. If yes are you aware of the Home loans of SBI?

A. Yes
B. No

4. Which bank you prefer for taking loans?

A. SBI
B. BOB
C. DENA BANK
D. COOPRATIVE BANKS

5. What do you feel about the services providing by The Umreth Urban Cooprative
bank in Home Loan product?

A. Dissatisfy
B. Moderate
C. Satisfy
D. Delighted

6. Which features you like most in Loan segments of The Umreth Urban Cooprative
bank?

A. Less Paper Work

B. Transparency
C. Attractive Interest Rate
D. Fast Processing
E. Longer Repayment Period

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