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“A STUDY ON CUSTOMERS BEHAVIOR TOWARDS MULTI CREDIT CARDS”

Presented by:
PRADIPT KUMAR MOHANTY

DECLARATION

I hereby declare that the project entailed “A STUDY ON BEHAVIOR OF CUSTOMERS TOWARDS MULTI CREDIT CARDS” is an original project work carried out by me .For the IT EXSICUTIVE from C.B ON LINE OF THE PRIVATE LEMITED on the Mumbai . This piece of project is my genuine work and has not been published any where at any time to the best of my knowledge.





Place: Bhubaneswar

NAME: pradipt kumar mohanty

Date:--------------

CERTIFICATE FROM THE ORGANISATION

This is to certify that this project entitled “A STUDY ON BEHAVIOUR OF CUSTOMERS TOWARDS MULTI CRDITCARD” is a bonafide work by Pradipt Kumar Mohanty. He has carried out the research work under my guidance and supervision for the preparation of the dissertation report.

Signature of the corporate Guide

Date:-

CERTIFICATE BY THE GUIDE

To the best of my knowledge and belief the thesis embodies the work of the candidate and has been duly completed. Simultaneously, the thesis fulfills the requirements of the rules and regulations related to the summer internship of the institute and I am assured that the project is up to the standard both in respect to the contents .

Signature of the Faculty Guide

Date:

ACKNOWLEDGEMENT

I sincerely thank my corporate guide Mr. DELIP MOHANTY(Area Sales Manager) for giving me this opportunity to work in their esteem organization and helping me for completing the project in a successful manner. Without his encouragement and help, this project would have been incomplete.
I am also thankful to Mr. Don & Babu for his cooperation to complete my project and giving me the best of his job experience. I am also thankful to my faculty Last but not the least I am thankful to God, my family and my friends for their love and moral support.

Pradipt Kumar Mohanty

Executive Summary

The report on Summer Internship Programme done at ICICI Bank ,Bhubaneswar,Orissa.

This is the era of plastic money and everyone wants to avail himself/herself of this facility i.e. (Credit or Debit Cards). Due to this facility people need not keep much hard cash in their pocket. So banks are providing them this facility in terms of Debit and Credit Card with some terms and conditions.
Possession of credit cards has been increased through decades, which is best seen in the rise of customer by different banks. Now a days most of the young people prefer to have a credit card, which plays a vital role in the modern lifestyle.
ICICI Bank (Industrial Credit and Investment Corporation of India) is India's largest private sector bank and second largest overall. ICICI Bank has total assets of about USD 56 Billion (end-Mar 2008), a network of over 619 branches and offices, and about 2400 ATMs. ICICI Bank concluded India's largest ever securitization transaction of a pool of retail loan assets aggregating to Rs.48.96 billion (equivalent of USD 1.21 billion) in a multi-tranche issue backed by four different asset categories. It is also the largest deal in Asia (ex-Japan) in 2008 till date and the second largest deal in Asia (ex-Japan & Australia) since the beginning of 2007.
ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management.
This entire project contains a serious discussion about the behavior of multi credit card customers in accordance with ICICI Bank. This will really help to collect information about customers’ likes and dislikes and reasons for them. This is part of market research and helps to maintain relation with customers in the long-term.
In this project the main emphasis is given to present credit card market scenario, perception of customers about the companies, aware the company about customer expectation & the main motto was as mentioned in my topic the credit card users facing the problem.
The following points are totally based on my project “Customers Behavior on Multi credit card ” research and findings
I have taken the data of six banks –ICICI Bank, HDFC Bank, Standard Chartered Bank, Citibank, State Bank of India and IDBI Bank for my detailed study.

1. Total percentage of credit card customers in Bhubaneswar: In this content I have collected the total numbers of credit card customers in several bank including ICICI Bank and their percentage.

2. Requirement and needs of credit card holders in Bhubaneswar:
In this content I have found the needs & requirement of credit card holders of several banks including ICICI bank in Bhubaneswar.

3. Problems facing by credit card holders in several banks including ICICI Bank in Bhubaneswar:
In this content I have found out the problems which the credit card customers are facing in Bhubaneswar.

4. Discussion and conclusion:
At last after the study of all above points, I have reached at the Conclusion and suggestion for the ICICI Bank for their future Growth and development.

CONTENTS-:1

Page No

CHAPTER-I Introduction & Review of literature (10-15)
CHAPTER-II Conceptual Study (17-34)
 About Credit Cards
 Important Credit Cards Terms& Terminology
 Credit Cards Operation of Banks(RBI Guidelines)
 Objective of the Study
 Limitation of the Study

CHAPTER-III Company Profile (36-53)

 History of ICICI Bank
 Key Business area of the Bank
 Types of Credit Cards offered by the bank
 SWOT analysis

CHAPTER-IV Research Methodology (55-56)

CHAPTER-V Data Analysis (58-66)

 Tabulation
 Computation
 Graphical presentation of Data

CHAPTER-VI Analysis Exploration (68-78)

 Findings
 Suggestions
 Conclusion
 Bibliography
 Appendix

INTRODUCTION & REVIEW OF LITERATURE

Introduction and Review of Literature

What is Behavior?

Behavior refers to the actions or reactions of an organism, usually in relation to the environment. Behavior can be conscious or unconscious, overt or covert, and voluntary or involuntary. In animals, behavior is controlled by the endocrine system and the nervous system. The complexity of the behavior of an organism is related to the complexity of its nervous system. Generally, organisms with complex nervous systems have a greater capacity to learn new responses and thus adjust their behavior. Human behavior (and that of other organisms and mechanisms) can be common, unusual, acceptable, or unacceptable. Humans evaluate the acceptability of behavior using social norms and regulate behavior by means of social control. Animal behavior is studied in comparative psychology, ethnology, behavioral ecology and sociobiology.

Effect of behavior in Marketing

From the organization points when question arises about the marketing marketers always believe that Customer Rules this playground. Thus they know their primary responsibility to the organization is to gain an intimate knowledge of their customers:
That is
 What satisfies them and makes them happy.
 What benefits they are seeking in the market place.

Consumer Decision-Making

Most studies of the decision-making process in marketing have used an adaptation of the scientific method. This decision-making process is as follows:
a. Problem recognition.

The consumer recognizes a problem.

b. Information search. Internal and external.

The consumer thinks about options he or she may have to remedy his or her situation (internal search) and then he or she seeks external sources of information such as friends, newspapers, TV, and the internet.
c. Alternative identification and evaluation.

He or she has some ideas about what Alternatives he/she she has and how to approach them. She now must compare and contrast the options she has.
d. Choice and purchase.

Based on this process of consideration the consumer now purchases the most attractive option he or she has identified.
e. Post purchase evaluation.

The consumer experiences his or her choice and determines if he is happy with it.
f. Feedback learning for future consumption behavior

The consumer remembers how he feels about his purchase and makes note of it for future reference (internal search).As This approach is worthwhile for organization so that they will have a general framework to understand consumer purchasing behavior and the purchasing.

Factors affecting consumer behavior

Group/Social Variables:

While there are many different impacts on consumer buying behavior that have to do with groups, we consider the following three as the most important overall.
Reference Groups

First, reference groups are collections of other people who strongly affect what we buy and how we go about buying it .Groups you would like to be a member of but are not, are called Aspirant Reference Groups, groups to which you don’t really expect membership, but still want to be somehow related to are called Associative Reference Groups and groups in which you would not seek membership are termed Dissociate.

Many adopt the appearance of their aspirant or associative groups by engaging in consumption behavior to express their personal sentiment. For example, one may buy a Colorado Rockies Hat and wear in public because s/he is a fan of that particular baseball team. This person would belong to an associative reference group but not be a member of an aspirant reference group because in our example the fan does not really expect to be able to join the Rockies team in any official capacity.

Ethnicity - Culture/Sub culture

We define .culture. as the totality of artifacts and behaviors handed down from one generation to the next. A subculture can be any segment of society that hands down its own beliefs across an extended period of time .Thus, different subcultures intermingle their ideas and art forms in a ethnically diverse society.

Individual/Psychological Variables that Impact Buying Behavior
Learning
Learning is an important concept in consumer buying behavior. Learning can be defined as .changes in attitudes or behavior based on experience. We learn constantly about products and services available and adjust our consumption patterns to what we learn.

Attitude

An attitude can be defined .predisposition to respond to stimuli.. In plain English, an attitude is simply how we feel about something. If you are apathetic about a certain product or issue, you don’t really have an attitude related to it .Neutral attitude. is an oxymoron , it is internally contradictory .Attitude formation can follow several different patterns. Attitudes are usually comprised of three parts:- Cognitive, evaluative and behavioral. That is, a consumer normally goes through three stages when forming an attitude.

Perception

Perception can be defined as .the way we experience life. That is, perception is how we attach meaning to all of the inputs that we are exposed to in daily living. Marketers have been interested in perception because they are constantly trying to communicate product and service ideas to their target markets and they need to understand how that information will be received and understood. Humans normally go through several stages in the process of perceiving meaning. These stages include exposure, attention, attached meaning, and retention. You may see a TV ad for Coca Cola .Perception remains an important construct in marketing because the study of perception can give information to marketing communications professionals about when and how people receive and make sense of information.


Risk:
Risk, in the consumer buying behavior area, can be defined as the potential negative consequence of a certain action including buying or using a certain product or service.
In marketing, we usually use the term .perceived risk, because the person or persons we are trying to understand determine the amount of risk. That is, we can advertise that there is no risk associated with taking aspirin for a headache, but some of the populace will perceive a health risk (physical risk) because they have heard that aspirin is dangerous.

There are several types of risk that have been identified in research. We will cover four kinds of risk:
a. Physiological risk - associated with threats to one’s health.
b. Financial risk - risk associated with the loss of economic wealth or financial security
c. Psychological risk -threats associated with some psychological construct, for example, a threat to one’s self-esteem
d. Social risk - a threat to one’s social standing or social comfort

Customer Marketing Definitions:
Customer Retention: Good marketers have two objectives with any kind of customer retention marketing:
1. Hold on to the most valuable customers
2. Try to make less valuable customers more valuable
Retention marketing programs are designed to react to and prevent customer defection while growing the overall valuation of the customer base.
Data-Driven Marketing
Customer retention-oriented marketing approach using customer data, and especially customer behavior, to determine the targeting, timing, and content of marketing promotions.
Rules of Data-Driven Marketing
Four rules underlying all Data-Driven marketing programs:
1. Data-Driven Marketing is about allocating marketing resources. Customer profiles are used to select marketing approaches generating the highest profit, and to avoid promotions with the lowest profit.
2. Past and Current customer behavior is the best predictor of Future customer behavior.
3. Customers want to win at the consuming game. They like to "feel good" about decisions they make, and marketing promotions (discounts, sweepstakes, special benefits, etc.) are designed to encourage these feelings.
4. Data-Driven marketing is all about:
Action – Reaction – Feedback – Repeat


CRM
Customer Relationship Management is the newest term for what has really been going on for decades in database marketing; it's the evolving practice of understanding customer behavior and reacting to it in order to maximize profitability. CRM boasts a new set of tools to accomplish this, largely driven by the widespread use of the Internet, but the basic concepts are the same - know the customer and use this knowledge to increase the profitability of a business.
LifeTime Value (LTV)
The net profit a customer contributes to a business over the entire Lifecycle. Generally calculated as gross margin or contribution to overhead minus the promotional costs of acquisition and retention, including any discounts. More on LTV
Eight Tips for Customer-Focused Marketing Promotions
1. Always advertise where the behavior they want to create is. If they want clicks, advertise where people are clicking. If they want buyers, advertise where people buy.
2. The media and method used to acquire a customer has a very large effect on the potential value of the customer. Customers from search engines will have different buying patterns and potential values than customers from banner ads.
3. 50 percent to 60 percent of customer base will be one-time buyers or visitors. One-time buyers who bought multiple items on the first purchase are a possible exception.
4. The only chance you have at getting a first-time buyer to purchase again is to contact them quickly after the first purchase.
5. One-time buyers who return their only purchase CAN be better marketing targets than those who don't return their purchase - IF the customer service experience they have in dealing with the return is outstanding.
6. Customers on average will buy down in price over their Lifecycle; unless organizations take specific action to influence this behavior, the average order price falls over time. For this reason, buyers who "go cheap" on the first purchase usually have lousy future value.
7. One Rs. 500 1st purchase customer is worth more than twoRs.250 1st purchase customers.
8. Resend a promotion to the same people .organization can often get 50% of the first response rate if the original promotion was a targeted one








Conceptual study
ABOUT CREDIT CARD

A credit card is a system of payment named after the small plastic card issued to users of the system. In the case of credit cards, the issuer lends money to the consumer (or the user) to be paid later to the merchant.
Credit is a method of selling goods or services without the buyer having cash in hand. A credit card is only an automatic way of offering credit to a consumer. Today, every credit card carries an identifying number that speeds shopping transactions. Imagine what a credit purchase would be like without it, the sales person would have to record your identity, billing address, and terms of repayment. It is basically an unsecured loan which banks give to customers on the basis their income eligibility and they use it and pay the bills monthly. It is different from a charge card, which requires the balance to be paid in full each month. In contrast, a credit card allows the consumer to 'revolve' their balance, at the cost of having interest charged. Most credit cards are issued by local banks or Credit Unions, and are the same shape and size, as specified by the ISO 7810 standard.
According to Encyclopedia Britannica, "the use of credit cards originated in the United States during the 1920s, when individual firms, such as oil companies and hotel chains, began issuing them to customers." However, references to credit cards have been made as far back as 1890 in Europe. Early credit cards involved sales directly between the merchant offering the credit and credit card, and that merchant's customer. Around 1938, companies started to accept each other's cards. Today, credit cards allow you to make purchases with countless third parties



Credit cards in India
Credit cards have finally arrived in India. The card industry, which is growing at the rate of 20 per cent per annum, is flooded with cards ranging from gold, silver, global, smart to secure…the list is endless. From just two payments in the early ‘80s, the industry now houses over 10 major players vying for a major chunk of the card pie.
Currently, four major bishops are ruling the card empire - Citibank, Standard Chartered Bank, HSBC and State Bank of India (SBI). The industry, which is catering to over 3.8 million1 card users, is expected to double by the fiscal 2003. According to a study conducted by State Bank of India, Citibank is the dominant player, having issued 1.5 million cards so far. Standard Chartered Bank follows way behind with 0.67 million, while Hong Kong Bank has 0.3 million credit card customers. Among the nationalized banks, SBI tops the list with 0.28 million cards, followed by Bank of Baroda at 0.22 million.
The credit card market in India, which started out in 1981, is on the verge of an unprecedented boom. Between 1987 and 2000, the market has virtually grown to over 3.8 million cards with almost 25-30 per cent growth in new card-holders.
India is generating more credit card spenders than spending places. While card-base and appends are growing at a spiffy 25-30 per cent2 annually, the number of merchant establishments which accept cards is growing selectively sluggish. The figure was put at 75,000–80,000 a couple of years ago, and now stands at 100,000 on both the Visa and MasterCard loops. As opposed to that, there are 2.5 million card-holders and 3.3 million cards (some, obviously, have more than one) and the numbers are growing very strongly.
The seven million Indian credit card industry has been growing over 25 per cent3 annually and has now more than 30 banks chasing customers with their cards. Still, credit cards in India have made business sense only to a few.
“The annual growth rate is good, but it is only 20 per cent of the card base, that is generating revenue,” says Roopan Asthana, manager, Card Products Division of HSBC. Nearly 45-50 per cent of the card-holders are estimated to be inactive, while another 30 per cent use the card as a charge card without using the revolving facility cards are expected to account for 33 per cent of all purchases by 2000 and 43 per cent by 2005.

The inventor of the first bank issued credit card was John Biggins of the Flatbush National Bank of Brooklyn in New York. In 1946, Biggins invented the "Charge-It" program between bank customers and local merchants. Merchants could deposit sales slips into the bank and the bank billed the customer who used the card.

How credit cards work:
Credit cards are issued after an account has been approved by the credit provider, after which cardholders can use it to make purchases at merchants accepting that card.
When a purchase is made, the credit card user agrees to pay the card issuer. The cardholder indicates his/her consent to pay, by signing a receipt with a record of the card details and indicating the amount to be paid or by entering a Personal identification number (PIN).
Each month, the credit card user is sent a statement indicating the purchases undertaken with the card, any outstanding fees, and the total amount owed. After receiving the statement, the cardholder may dispute any charges that he or she thinks are incorrect (see Fair Credit Billing Act for details of the US regulations).
Otherwise, the cardholder must pay a defined minimum proportion of the bill by a due date, or may choose to pay a higher amount up to the entire amount owed. The credit provider charges interest on the amount owed (typically at a much higher rate than most other forms of debt).
Important Credit Card Terms or Terminology
When you sign up for a new credit card, the issuer will make you sign pages and pages of documents with sophisticated financial and credit card jargon that you probably have no idea about. Don't worry, in this page, we will define 13 common credit card terms that you will find in almost any credit card agreement. Therefore, before you sign that next credit card agreement, do read all the fine print and ask questions if you do not understand a term!
1) Annual Fee
Annual fee is the bank charge you have to pay each year for use of your credit cards. Sometimes also known as a membership or participation fee, the annual fee ranges from $15 - $300 a year. In present day and age, many issuers are offering credit cards without an annual fee to attract more signups. Therefore, compare and choose a credit card without an annual fee next time you are out!
2) Annual Percentage Rate (APR)
The APR is the annual interest charged on your use of your credit cards including any fees and costs paid to acquire the loan. Credit card issuers are obligated to tell you the exact APR you will be paying on your credit card.
3) Average Daily Balance
Average Daily Balance is used to determine the interest payments you will be making on your debt owed every month. The formula is as follows:-
Average Daily Balance = (Annual Percentage Rate (APR) / 12 months of the year) x Debt Owed
For example, if you owed $5000 in credit card debt and the APR charged is 15%, then the finance (interest) charge would be:
Average Daily Balance = (15% / 12 months) x $5000
Average Daily Balance = (1.25%) x $5000
Average Daily Balance = $62.50

4) Balance Transfer
Balance transfer is the process of moving unpaid credit card debt owed from one issuing company to another issuing company. Credit card issuers sometimes offer very low interest rates to encourage people to transfer their debt balances owed to their company. Many card issuers also have balance transfer-out fees that discourage people from moving their balances from one issuer to another.
5) Cash Advance Fee
When you withdraw money from the ATM using your credit card, your bank will charge you a Cash Advance fee. This fee is usually a % of the cash advance amount you withdraw from the ATM. For instance, the fee may be expressed as "2%/$12" This means you will be charged 2% of the cash amount you withdraw, or $12, whichever is higher.
6) Credit Limit
This is the total maximum amount of money you can borrow from your credit card, at any given point in time.
7) Finance Charges
There are different finance charges for any balance-transfers, cash advances and regular usage of credit. Make sure you read the fine print of your credit card agreement or ask your issuer of the exact finance charges you will have to pay on any of these above items.
8) Grace Period
Grace period is the interest-free period for a borrower between the time he makes a transaction and till billing time. Grace period usually lasts 20-30 days within which you won't get charged interest. If your issuer has no grace period, your interest payments begin the day you use your credit card for any purchases.
9) Introductory Rate
Introductory interest rate is a teaser low interest rate that lenders use to encourage new customers to transfer their balances to their company or switch their card issuers. Make sure you do not get carried away with the introductory interest rates, but ask for the actual APR you will be paying.
10) Pre-Approved
If you get a mail saying you've been pre-approved for a $14000 credit card or something, know that pre-approval only means you've passed a preliminary credit screening test. Your card issuer can still decline your application if your credit score is too low (you are not a good risk for lending money to).
11) Secured Credit Cards
Secured credit cards are types of credit cards that are bonded with your savings deposit accounts. If the borrower defaults on the monthly debt payments required on the card, the issuer can withdraw the balance from the attached savings deposit account. Secured cards are used by people trying to rebuild their credit or new credit.
12) Universal Default
This is a universal interest rate that all card issuers can impose on borrowers if they are 30 days or more late for payment. For example, if you owe $500 in credit card debt and have made no payments for 30 days or more, the issuer can skyrocket your interest rate to 20-35%. Read the fine print of your credit card agreement, it will say whether your issuer has the right of Universal Default or not.
Parties involved
• Cardholder: The holder of the card used to make a purchase; the consumer.
• Card-issuing bank: The financial institution or other organization that issued the credit card to the cardholder. This bank bills the consumer for repayment and bears the risk that the card is used fraudulently. American Express and Discover were previously the only card-issuing banks for their respective brands, but as of 2007, this is no longer the case.
• Merchant: The individual or business accepting credit card payments for products or services sold to the cardholder
• Acquiring bank: The financial institution accepting payment for the products or services on behalf of the merchant.
• Independent sales organization: Resellers (to merchants) of the services of the acquiring bank.
• Merchant account: This could refer to the acquiring bank or the independent sales organization, but in general is the organization that the merchant deals with.
• Credit Card association: An association of card-issuing banks such as Visa, MasterCard, Discover, American Express, etc. that set transaction terms for merchants, card-issuing banks, and acquiring banks.
• Transaction network: The system that implements the mechanics of the electronic transactions. May be operated by an independent company, and one company may operate multiple networks. Transaction processing networks include: Cardnet, Nabanco, Omaha, Paymentech, NDC Atlanta,
• Nova, Vital, Concord EFSnet, and VisaNet.


Transaction steps
• Authorization: The cardholder pays for the purchase and the merchant submits the transaction to the acquirer (acquiring bank). The acquirer verifies the credit card number, the transaction type and the amount with the issuer (Card-issuing bank).
• Batching: Authorized transactions are stored in "batches", which are sent to the acquirer. Batches are typically submitted once per day at the end of the business day.
• Clearing and Settlement: The acquirer sends the batch transactions through the credit card association, which debits the issuers for payment and credits the acquirer. Essentially, the issuer pays the acquirer for the transaction.
• Funding: Once the acquirer has been paid, the acquirer pays the merchant. The merchant receives the amount totaling the funds in the batch minus the "discount rate," which is the fee the merchant pays the acquirer for processing the transactions.
• Chargeback: A chargeback is an event in which money in a merchant account is held due to a dispute relating to the transaction. Chargeback’s are typically initiated by the cardholder. In the event of a chargeback, the issuer returns the transaction to the acquirer for resolution. The acquirer then forwards the chargeback to the merchant, who must either accept the chargeback or contest it.


Features
Credit cards are not only convenient in accessing credit but also offer consumers an easy way to track expenses, which is necessary for both monitoring personal expenditures and the tracking of work-related expenses for taxation and reimbursement purposes. Credit cards are accepted worldwide, and are available with a large variety of credit limits, repayment arrangement, and other perks (such as rewards schemes in which points earned by purchasing goods with the card can be redeemed for further goods and services or credit card cash back).
Interest charges
Credit card issuers usually waive interest charges if the balance is paid in full each month, but typically will charge full interest on the entire outstanding balance from the date of each purchase if the total balance is not paid.
The credit card may simply serve as a form of revolving credit, or it may become a complicated financial instrument with multiple balance segments each at a different interest rate.
Benefits
Because of intense competition in the credit card industry, credit card providers often offer incentives such as frequent flyer points, gift certificates, or cash back (typically up to 1 percent based on total purchases) to try to attract customers to their programs.
Grace period
A credit card's grace period is the time the customer has to pay the balance before interest is charged to the balance. Grace periods vary, but usually range from 20 to 30 days depending on the type of credit card and the issuing bank. Some policies allow for reinstatement after certain conditions are met.
Usually, if a customer is late paying the balance, finance charges will be calculated and the grace period does not apply. Finance charges incurred depend on the grace period and balance; with most credit cards there is no grace period if there is any outstanding balance from the previous billing cycle or statement (i.e. interest is applied on both the previous balance and new transactions).
Security
Credit card security relies on the physical security of the plastic card as well as the privacy of the credit card number. Therefore, whenever a person other than the card owner has access to the card or its number, security is potentially compromised. Merchants often accept credit card numbers without additional verification for mail order purchases. They however record the delivery address as a security measure to minimise fraudulent purchases. The main one is to require a security PIN with the card, which requires that the thief have access to the card, as well as the PIN.
Operating costs
This is the cost of running the credit card portfolio, including everything from paying the executives who run the company to printing the plastics, to mailing the statements, to running the computers that keep track of every cardholder's balance, to taking the many phone calls which cardholders place to their issuer, to protecting the customers from fraud rings. Depending on the issuer, marketing programs are also a significant portion of expenses.
Charge offs
When a consumer becomes severely delinquent on a debt (often at the point of six months without payment), the creditor may declare the debt to be a charge-off. It will then be listed as such on the debtor's credit bureau reports The item will include relevant dates, and the amount of the bad debt.
A charge-off is considered to be "written off as uncollectible." To banks, bad debts and even fraud are simply part of the cost of doing business
Interchange fee
Bank card associations like Visa and MasterCard require merchants to pay billions of dollars in Interchange fees to banks that issue their credit and debit cards .Card-issuing banks obtain these interchange fees in addition to the enormous revenue they receive from card holder interest and fees. Interchange fees are the single largest component of the various fees that banks deduct from merchants' credit card sales. Merchants pay their banks fees of 1 to 6 percent of each sale (for large merchants these fees may be negotiated, but will vary not only from merchant to merchant, but also from card to card, with business cards and rewards cards generally costing the merchants more to process), which is why many merchants prefer cash, PIN-based debit cards, or even cheques , or will add a percentage to the sale price to cover the interchange fee. Traditionally, interchange fees have been set by the bank card associations and their major card-issuing banks, who are the primary beneficiaries of these fees.
Hidden costs
In the United Kingdom, merchants won the right through The Credit Cards (Price Discrimination) Order 1990 to charge customers different prices according to the payment method. The United Kingdom is the world's most credit-card-intensive country, with 67 million credit cards for a population of 59 million people.
In the United States, until 1984 federal law prohibited surcharges on card transactions. Although the federal Truth in Lending Act provisions that prohibited surcharges expired that year, a number of states have since enacted laws that continue to outlaw the practice; California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Maine, New York, Oklahoma, and Texas have laws against surcharges.
Redlining
Credit Card redlining is a spatially discriminatory practice among credit card issuers of providing different amounts of credit to different areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas.
Credit card numbering
The numbers found on credit cards have a certain amount of internal structure, and share a common numbering scheme. The card number's prefix, called the Bank Identification Number, is the sequence of digits at the beginning of the number that determine the bank to which a credit card number belongs. This is the first six digits for MasterCard and Visa cards. The next nine digits are the individual account number, and the final digit is a validity check code.
In addition to the main credit card number, credit cards also carry issue and expiration dates (given to the nearest month), as well as extra codes such as issue numbers and security codes. Not all credit cards have the same sets of extra codes nor do they use the same number of digits.
Credit cards in ATMs
Many credit cards can also be used in an ATM to withdraw money against the credit limit extended to the card, but many card issuers charge interest on cash advances before they do so on purchases. The interest on cash advances is commonly charged from the date the withdrawal is made, rather than the monthly billing date. Many card issuers levy a commission for cash withdrawals, even if the ATM belongs to the same bank as the card issuer. Merchants do not offer cash back on credit card transactions because they would pay a percentage commission of the additional cash amount to their bank or merchant services provider, thereby making it uneconomical.
Credit Card Operations of banks- RBI Guidelines (Nov 21, 05)
Pursuant to the announcement made in the Annual Policy Statement 2004-05, the Reserve Bank of India had constituted a Working Group on Regulatory Mechanism for Cards. The Group has suggested various regulatory measures aimed at encouraging growth of credit cards in a safe, secure and efficient manner as well as to ensure that the rules, regulations, standards and practices of the card issuing banks are in alignment with the best customer practices. The following guidelines on credit card operations of banks have been framed based on the recommendations of the Group as also the feedback received from the members of the public, card issuing banks and others. All the credit card issuing banks / NBFCs should implement these guidelines immediately. Each bank / NBFC must have a well documented policy and a Fair Practices Code for credit card operations. In March 2005, the IBA released a Fair Practices Code for credit card operations which could be adopted by banks / NBFCs. The bank / NBFC's Fair Practice Code should, at a minimum, incorporate the relevant guidelines contained in this circular. Banks / NBFCs should widely disseminate the contents thereof including through their websites, at the latest by November 30, 2005.

Guidelines for Implementation:
1. Issue of cards:
a. Banks / NBFCs should independently assess the credit risk while issuing cards to persons, specially to students and others with no independent financial means.
b. As holding several credit cards enhances the total credit available to any consumer, banks / NBFCs should assess the credit limit for a credit card customer having regard to the limits enjoyed by the cardholder from other banks on the basis of self declaration/ credit information.
c. The card issuing banks / NBFCs would be solely responsible for fulfillment of all KYC requirements, even where DSAs / DMAs or other agents solicit business on their behalf.
d. While issuing cards, the terms and conditions for issue and usage of a credit card should be mentioned in clear and simple language (preferably in English, Hindi and the local language) comprehensible to a card user.
2. Interest rates and other charges:
a. Card issuers should ensure that there is no delay in dispatching bills and the customer has sufficient number of days (at least one fortnight) for making payment before the interest starts getting charged.
b. Card issuers should quote annualized percentage rates (APR) on card products (separately for retail purchase and for cash advance, if different). The method of calculation of APR should be given with a couple of examples for better comprehension. The APR charged and the annual fee should be shown with equal prominence. The late payment charges, including the method of calculation of such charges and the number of days, should be prominently indicated. The manner in which the outstanding unpaid amount will be included for calculation of interest should also be specifically shown with prominence in all monthly statements. Even where the minimum amount indicated to keep the card valid has been paid, it should be indicated in bold letters that the interest will be charged on the amount due after the due date of payment. These aspects may be shown in the Welcome Kit in addition to being shown in the monthly statement.
c. The bank / NBFC should not levy any charge that was not explicitly indicated to the credit card holder at the time of issue of the card and getting his / her consent. However, this would not be applicable to charges like service taxes, etc. which may subsequently be levied by the Government or any other statutory authority.

d. The terms and conditions for payment of credit card dues, including the minimum payment due, should be stipulated so as to ensure that there is no negative amortization.
e. Changes in charges (other than interest) may be made only with prospective effect giving notice of at least one month. If a credit card holder desires to surrender his credit card on account of any change in credit card charges to his disadvantage, he may be permitted to do so without the bank levying any extra charge for such closure.
a. The card issuing bank / NBFC should ensure that wrong bills are not raised and issued to customers. In case, a customer protests any bill, the bank / NBFC should provide explanation and, if necessary, documentary evidence to the customer within a maximum period of sixty days with a spirit to amicably redress the grievances.
b. To obviate frequent complaints of delayed billing, the credit card issuing bank / NBFC may consider providing bills and statements of accounts online, with suitable security built therefore.

3. Use of DSAs / DMAs and other agents:

a. When banks / NBFCs outsource the various credit card operations, they have to be extremely careful that the appointment of such service providers do not compromise with the quality of the customer service and the bank / NBFC’s ability to manage credit, liquidity and operational risks. In the choice of the service provider, the bank /NBFCs have to be guided by the need to ensure confidentiality of the customer’s records, respect customer privacy, and adhere to fair practice in debt collection.
b. The Code of Conduct for Direct Sales Agents (DSAs) formulated by the Indian Banks’ Association (IBA) could be used by banks / NBFCs in formulating their own codes for the purpose. The bank / NBFC should ensure that the DSAs engaged by them for marketing their credit card products scrupulously adhere to the bank / NBFC’s own Code of Conduct for credit card operations which should be displayed on the bank / NBFC’s website and be available easily to any credit card holder.
c. The bank / NBFC should have a system of random checks and mystery shopping to ensure that their agents have been properly briefed and trained in order to handle with care and caution their responsibilities, particularly in the aspects included in these guidelines like soliciting customers, hours for calling, privacy of customer information, conveying the correct terms and conditions of the product on offers etc .
4. Protection of Customer Rights:
Customer’s rights in relation to credit card operations primarily relate to personal privacy, clarity relating to rights and obligations, preservation of customer records, maintaining confidentiality of customer information and fair practices in debt collection. The card issuing bank / NBFC would be responsible as the principal for all acts of omission or commission of their agents (DSAs / DMAs and recovery agents)
i. Right to privacy:
a. Unsolicited cards should not be issued. In case, an unsolicited card is issued and activated without the consent of the recipient and the latter is billed for the same, the card issuing bank / NBFC shall not only reverse the charges forthwith, but also pay a penalty without demur to the recipient amounting to twice the value of the charges reversed.
b. Unsolicited loans or other credit facilities should not be offered to the credit card customers. In case, an unsolicited credit facility is extended without the consent of the recipient and the latter objects to the same, the credit sanctioning bank / NBFC shall not only withdraw the credit limit, but also be liable to pay such penalty as may be considered appropriate.
c. The card issuing bank / NBFC should not unilaterally upgrade credit cards and enhance credit limits. Prior consent of the borrower should invariably be taken whenever there are any changes in terms &conditions.
d. card issuing bank / NBFC should maintain a Do Not Call Registry (DNCR) containing the phone numbers (both cell phones and land phones) of customers as well as non-customers (non-constituents) who have informed the bank / NBFC that they do not wish to receive unsolicited calls / SMS for marketing of its credit card products. The DNCR should be set up within two (2) months from the date of this circular and wide publicity should be given to the arrangement.
e. The intimation for including an individual’s telephone number in the Do Not Call Registry (DNCR) should be facilitated through a website maintained by the bank / NBFC or on the basis of a letter received from such a person addressed to the bank /NBFC.
f. The card issuing bank / NBFC should introduce a system whereby the DSAs/ DMAs as well as its Call Centers have to first submit to the bank / NBFC a list of numbers they intend to call for marketing purposes. The bank / NBFC should then refer to the Do Not Call Registry (DNCR) and only those numbers which do not figure in the registry should be cleared for calling.
g. The numbers cleared by the card issuing bank / NBFC for calling should only be accessed. The bank / NBFC would be held responsible if a Do Not Call Number (DNCN) is called on by its DSAs/DMAs or Call Centre/s.
h. The card issuing bank / NBFC should ensure that the Do Not Call Registry (DNCR) numbers are not passed on to any unauthorized person/s or misused in any manner.
(ii) Customer confidentiality:
a. The card issuing bank / NBFC should not reveal any information relating to customers obtained at the time of opening the account or issuing the credit card to any other person or organization without obtaining their specific consent, as regards the purpose/s for which the information will be used and the organizations with whom the information will be shared. Banks / NBFCs should satisfy themselves, based on specific legal advice, that the information being sought from them is not of such nature as will violate the provisions of the laws relating to secrecy in the transactions. Banks / NBFCs would be solely responsible for the correctness or Otherwise of the data provided for the purpose.
b. In case of providing information relating to credit history / repayment record of the card holder to a credit information company (specifically authorized by RBI), the bank / NBFC may explicitly bring to the notice of the customer that such information is being provided in terms of the Credit Information Companies (Regulation) Act, 2005.
c. Before reporting default status of a credit card holder to the Credit Information Bureau of India Ltd. (CIBIL) or any other credit information Company authorized by RBI, banks / NBFCs may ensure that they adhere to a procedure, duly approved by their Board, including issuing of sufficient notice to such card holder about the intention to report him/ her as defaulter to the Credit Information Company. The procedure should also cover the notice period for such reporting as also the period within which such report will be withdrawn in the event the customer settles his dues after having been reported as defaulter. Banks / NBFCs should be particularly careful in the case of cards where there are pending disputes. The disclosure/ release of information, particularly about the default, should be made only after the dispute is settled as far as possible. In all cases, a well laid down procedure should be transparently followed. These procedures should also be transparently made knownas part of MITCs.
d. The disclosure to the DSAs / recovery agents should also be limited to the extent that will enable them to discharge their duties. Personal information provided by the card holder but not required for recovery purposes should not be released by the card issuing bank / NBFC. The card issuing bank / NBFC should ensure that the DSAs / DMAs do not transfer or misuse any customer information during marketing of credit card products.
(iii) Fair Practices in debt collection:
(a)In the matter of recovery of dues, banks / NBFCs may ensure that they, as also their agents, adhere to the extant instructions on Fair Practice Code for lenders (circular DBOD. Leg. No. BC. 104 /09.07.007 / 2002–03 dated May 5, 2003) as also IBA’s Code for Collection of dues and repossession of security. In case banks / NBFCs have their own code for collection of dues it should, at the minimum, incorporate all the terms of IBA’s code.
(b) In particular, in regard to appointment of third party agencies for debt collection, it is essential that such agents refrain from action that could damage the integrity and reputation of the bank / NBFC and that they observe strict customer confidentiality. All letters issued by recovery agents must contain the name and address of a responsible senior officer of the card issuing bank whom the customer can contact at his location.
(c) Banks / NBFCs / their agents should not resort to intimidation or harassment of any kind, either verbal or physical, against any person in their debt collection efforts, including acts intended to humiliate publicly or intrude the privacy of the credit card holders’ family members, referees and friends, making threatening and anonymous
calls or making false & misleading representations.
6. Redressal of Grievances:
a. Generally, a time limit of sixty (60) days may be given to the customers forpreferring their complaints /grievances.
b. The card issuing bank / NBFC should constitute Grievance Redressal machinery within the bank / NBFC and give wide publicity about it through electronic and print media. The name and contact number of designated grievance redressal officer of the bank / NBFC should be mentioned on the credit card bills. The designated officer should ensure that genuine grievances of credit card subscribers are redressed promptly without involving delay.
c. The grievance redressal procedure of the bank / NBFC and the time frame fixed for responding to the complaints should be placed on the bank / NBFC's website. The name, designation, address and contact number of important executives as well as the Grievance Redressal Officer of the bank / NBFC may be displayed on the website. There should be a system of acknowledging customers' complaints for follow up, such as complaint number / docket number, even if the complaints are received on phone.
d. If a complainant does not get satisfactory response from the bank / NBFC within a maximum period of thirty (30) days from the date of his lodging the complaint, he will have the option to approach the Office of the concerned Banking Ombudsman for redressal of his grievance/s. The bank / NBFC shall be liable to compensate the complainant for the loss of his time, expenses, financial loss as well as for the harassment and mental anguish suffered by him for the fault of the bank and where the grievance has not been redressed in time.
7. Internal Control & Monitoring system:
With a view to ensuring that the quality of customer service is ensured on an on-going basis in banks / NBFCs, the Standing Committee on Customer Service in each bank / NBFC may review on a monthly basis the credit card operations including reports of defaulters to the CIBIL, credit card related complaints and take measures to improve the services and ensure the orderly growth in the credit card operations. Banks / NBFCs should put up detailed quarterly analysis of credit card related complaints to their Top Management. Card issuing banks should have in place a suitable monitoring mechanism to randomly check the genuineness of
merchant transaction.
8.
The Reserve Bank of India reserves the right to impose any penalty on a bank / NBFC under the provisions of the Banking Regulation Act, 1949 for violation of any of the guidelines.

\\






 To study behavior of Customers regarding usage of credit card.

 To study the effect of study of consumers behavior to the ICICI Bank.

 To study the customer preference about ICICI Bank credit card.

 To analyze the competition among various types of credit cards.

 To improve the services of the credit cards.
 To know the untouched potential customers.
 To attract the new customers to the bank.
 To know the drawbacks of ICICI Bank’s credit card services.











Limitation of Study







Every work has its own limitation. Limitation are extend to which the process should not exceed. The following limitations for the project are:

 Duration of the project was not enough to make our conclusion on such a vast subject. Time constraints has been also become a major limitation.
 The sample size taken for drawing the conclusion was not sizeable.
 Customer ignorance was faced during discussions with respondents.
 Lack of proper co-ordination of respondents.















COMPANY PROFILE








Company Profile

History of ICICI
 1955 : The Industrial Credit and Investment Corporation of India Limited (ICICI) incorporated at the initiative of the World Bank, the Government of India and representatives of Indian industry, with the objective of creating a development financial institution for providing medium-term and long-term project financing to Indian businesses. Mr. A. Ramaswami Mudaliar elected as the first Chairman of ICICI Limited.
 1977 : ICICI sponsored the formation of Housing Development Finance Corporation. Managed its first equity public issue.
 1986 : ICICI became the first Indian institution to receive ADB Loans. : ICICI, along with UTI, set up Credit Rating Information Services of India Limited, India's first professional credit rating agency. : ICICI promotes Shipping Credit and Investment Company of India Limited. : The Corporation made a public issue of Swiss Franc 75 million in Switzerland, the first public issue by any Indian entity in the Swiss Capital Market.
 1988 : Promoted TDICI - India's first venture capital company.
 1993 : ICICI Securities and Finance Company Limited in joint venture with J. P. Morgan set up. : ICICI Asset Management Company set up.
 1994 : ICICI Bank set up.
 1996 : ICICI Ltd became the first company in the Indian financial sector to raise GDR.SCICI merged with ICICI Ltd. : Mr. K.V.Kamath appointed the Managing Director and CEO of ICICI Ltd
 1999 : ICICI launched retail finance - car loans, house loans and loans for consumer durables. : ICICI becomes the first Indian Company to list on the NYSE through an issue of American Depositary Shares.
 2001 : The Boards of ICICI Ltd and ICICI Bank approved the merger of ICICI with ICICI Bank.
 2002 : ICICI Ltd merged with ICICI Bank Ltd to create India’s second largest bank in terms of assets. : ICICI assigned higher than sovereign rating by Moody’s. : ICICI Bank launched India’s first CDO (Collateralized Debt Obligation) Fund named Indian Corporate Collateralized Debt Obligation Fund (ICCDO Fund) : ATM-on-Wheels, India’s first mobile ATM, launched in Mumbai.
 2003 : The first Integrated Currency Management Centre launched in Pune. ICICI Bank announced the setting up of its first ever offshore branch in Singapore. : India’s first ever "Visa Mini Credit Card", a 43% smaller credit card in dimensions launched. : ICICI Bank became the market leader in retail credit in India.
 2004 : Max Money, a home loan product that offers the dual benefit of higher eligibility and affordability to a customer, introduced. : Mobile banking service in India launched in association with Reliance Infocomm. India’s first multi-branded credit card with HPCL and Airtel launched. Kisan Loan Card and innovative, low-cost ATMs in rural India launched. : ICICI Bank introduced 8-8 Banking wherein all the branches of the Bank would remain open from 8a.m. to 8 p.m. from Monday to Saturday. : ICICI Bank introduced the concept of floating rate for home loans in India.
 2005 : First Indian company to make a simultaneous equity offering of $1.8 billion in India, the United States and Japan. : ICICI Bank became the largest bank in India in terms of its market capitalization.
 2006 : ICICI Bank became the first Indian bank to issue hybrid Tier-1 perpetual debt in the international markets. : ICICI Bank subsidiary set up in Russia. : Introduced a new product - ‘NRI smart save Deposits’ – a unique fixed deposit scheme for nonresident Indians. : Financial counseling centre Disha launched. Disha provides free credit counseling, financial planning and debt management services.
 2007 : ICICI Bank‘s USD 2 billion 3-tranche international bond offering was the largest bond offering by an Indian bank. : Sangli Bank amalgamated with ICICI Bank. : ICICI Bank raised Rs 20,000 crore (approx $5 billion) from both domestic and international markets through a follow-on public offer. : Launched India’s first ever jewellery card in association with jewelry major Gitanjali Group. : ICICI Bank became the first bank in India to launch a premium credit card -- The Visa Signature Credit Card. : ICICI Bank became the first private bank in India to offer both floating and fixed rate on car loans, commercial vehicles loans, construction equipment loans and professional equipment loans. : Launched Bank@home services for all savings and current a/c customers residing in India :
 2008 : ICICI Bank launched iMobile, a breakthrough innovation in banking where practically all internet banking transactions can now be simply done on mobile phones. ICICI Bank concluded India's largest ever securitization transaction of a pool of retail loan assets aggregating to Rs. 48.96 billion (equivalent of USD 1.21 billion) in a multi-tranche issue backed by four different asset categories.

Mission of the Bank

• Customer Service and Product Innovation tuned to diverse needs of Individual and corporate clientele.
• Progressive globalization and achieving international standards.
• Continuous technology up gradation while maintaining human values.
• Efficiency and effectiveness built on ethical practices.

: Outlook and Future prospects of ICICI Bank

ICICI Bank dominates the Indian financial sector with its aggressive growth overtures.
ICICI Bank commands 25% share of the total retail assets outstanding in India (33% in fresh disbursements), against 17% for SBI. After its success in retail .financing, the bank is eyeing overseas expansion and rural banking to leverage the huge growth opportunities unfolding in these areas. Recent decision of RBI to allow ICICI bank to open new branches would help bank to maintain its growth momentum and increase its rural reach. This would help the bank to penetrate the market further and reach non banked rural people.

Apart from the Indian operations, the bank is eyeing the international markets. The vision of the bank is to play a significant role in facilitating trade by providing home and host country links to the domestic companies having business relations in the region and enable the bank to increase its participation in India’s trade transactions in the region. The bank is planning to expand its international operations to 25% of its total business in the next three years. With the bank targeting an overall growth of 30% per annum, its overseas business will have to triple from its current level to reach 25%. Unlocking of value in it major subsidiaries will be a trigger for the stock in the next 12- 18 months.
Key Business Areas of Operations of the Bank

The business operations of ICICI Bank can be broadly classified into the key income generating areas such as Retail Banking, International Banking, Rural Banking, Corporate Banking, & Treasury Operations. The functioning of some of the key divisions is enumerated below:

Key Business Area of Operations





a) Retail Banking
Retail banking has immense opportunities in a growing economy like India. As the growth story gets unfolded in India, retail banking is going to emerge as a major growth driver for the banking industry. The rise of the Indian middle class is an important contributing factor in this regard. The percentage of middle to high income Indian households is expected to rise sharply, going forward. The younger population not only wields increasing purchasing power, but as far as acquiring personal debt is concerned, they are perhaps more comfortable than previous generations. Improving consumer purchasing power, coupled with more liberal attitudes toward personal debt, is contributing to India’s retail banking segment. The combination of the above factors promises substantial growth in the retail sector, which at present is in the nascent stage. The Retail Banking Group of the ICICI Bank is responsible for products and services for retail customers and small enterprises including various credit products, liability products, distribution of third party investment and insurance products and transaction banking services. ICICI Bank was among the first banks to identify the growth potential of retail credit in India.

Retail Banking-
1. Credit:
• Demonstrated pricing power.
• Maintained market leadership in Retail credit.
• Achieved robust growth despite challenging environment.
2. Deposits:
• Fully leveraging liability franchise and technology channels.
• High incremental deposit market share despite lean branch infrastructure.
• Merger of Sangli Bank and branch rollout in Q4-2007 expected to hence deposit franchise.
3. Fee Income:
• Diversified fees income streams: Loans, cards, transaction Banking and distribution.
• Successful Insurance Cross-sell Initiatives.

Major Players in Retail Banking Industry:
Top Performing Public Sector Banks:
 1.Andhra Bank
 2.State Bank of Mysore
 3.Allahabad Bank
 4.Vijaya Bank
 5.Punjab National Bank
 6.Dena Bank
Top Performing Private Sector Banks:
 1. HDFC Bank
 2. UTI Bank
 3. ICICI Bank
 4. Kotak Mahindra Bank
 5. Centurion Bank of Punjab
 6. Yes Bank
b) Corporate Banking:

The corporate banking division provides comprehensive and customized financial solutions to the banks’ corporate customers. This segment offers a complete range of corporate banking products including rupee and foreign currency debt, working capital credit, structured financing, syndication and transaction banking products and services. ICICI bank is having focused relationship with the top 500 large corporate under this segment. In recent years, the bank has witnessed substantial demand for credit from the corporate sector. The bank’s international presence and deep corporate relationships has helped it to work closely on important overseas acquisitions made by Indian companies and some of the largest infrastructure projects in India.
Small and medium enterprises:

ICICI bank believes in the franchise model for the small enterprises segment and has significantly enhanced its franchise in this segment. As matter of strategy, the bank has focused on customer convenience in transaction banking services, as well as working capital loans to suppliers or dealers of large corporations, and clusters of small enterprises that have a homogeneous profile. During recent years, the bank has doubled its customer base and had expanded its reach to 110 locations covering 480 branches of the bank from which it serves small and medium enterprises, increased the number of products offered and clusters covered and achieved robust growth in business volumes.

Project Finance:

The Indian economy is witnessing resurgence in investment activity with companies undertaking both brown field and green field expansions across sectors like infrastructure, oil & gas, manufacturing, etc. ICICI bank is uniquely positioned to meet the funding requirements of companies by leveraging its domestic and overseas presence to offer innovative financing solutions. The key to its project finance proposition is its constant endeavor to add value to the projects through financial structuring to ensure bank ability of such projects. These services are backed by strong due diligence and structuring skills and extensive relationships with various international sponsors and consultants. Equal emphasis is laid on ensuring marketable debt structuring.
c) International Banking:
Few years back, ICICI bank had identified international banking as a key opportunity, aiming to cater to the cross-border needs of clients and leverage its domestic banking strengths to offer products internationally. The bank has made significant progress in the international business since it had set up its first overseas branch in Singapore in 2003. Currently, the bank has operations in 17 countries. The bank has established a strong franchise in the non-resident Indian (NRI) business and further consolidated its position in FY06 and H1FY07.

d) Rural Banking:

Under its rural banking strategy, ICICI has adopted a holistic approach to the financial services needs of various segments of the rural population, by delivering a comprehensive product suite encompassing credit, transaction banking, deposit, investment and insurance, through a range of channels. Rural delivery channels include branches, internet kiosks, franchisees and micro-finance institution partners. The rural economy represents a large latent demand for financial services including credit products, savings products, investment products and risk mitigation products like insurance.
e) Human Resources:
The bank had total staff strength of 25,384 as of 31st March, 2006. The current staff strength of the bank is around 32,000. Employee strength of the bank increased by 40.8% in FY06. The increase in number of employees in recent years was commensurate with the sharp growth in business. The bank is doing its best to create a wider pool for talent for which it is already having partnership with leading business schools in introducing banking industry specific courses to develop skills in areas like private banking, wealth management, credit appraisal and retail banking. It also focused its efforts towards building ICICI Bank as a preferred employer brand in its international locations and expanding its international employee base. Along with the payroll employees, the bank has a focus on DSA, who are on commission basis thereby higher operating overheads.



Subsidiaries and Group Companies of ICICI Bank:

ICICI bank has 16 subsidiaries in the areas such as life insurance, general insurance, investment banking, asset management, venture funds, home finance, brokerage services, etc. Profiles of some of the major subsidiaries are enumerated below:
1. ICICI Securities Limited:
ICICI Securities continued to enhance its position in the investment banking and equity broking businesses while capitalising on opportunities in the fixed income market. ICICI Securities achieved a profit after tax of Rs.1.6bn in fiscal 2006 compared to Rs.0.64bn in fiscal 2005.
ICICI Direct.com
ICICIdirect.com is a brand under ICICI Brokerage Services Ltd. that offers online share trading facility for trading in Indian equity markets. It is a 3-in-1 account, connecting all the accounts i.e. bank, broking and demat (essential for investing in Indian markets) to each other.
Thereby, it enables seamless and hassle free settlement for its clients.
ICICI. direct was launched in January 2000 and started its operations in April 2000. Now we produly service over 6 Lakh customers.The following are the products that are currently being offered on ICICI Direct:
a. Equity Trading
b. Mutual Funds (MF)
c. Initial Public Offer (IPO)
Demat account
For each ICICIdirect account, there has to be one corresponding demat account, where the settlements of shares can be done. Since it is a complete online offering, for all the purchase transactions, shares will be credited to the linked demat account and for all the sale transactions, shares will be debited from the linked demat account only.
Demat Services
ICICI Bank Demat Services boasts of an ever-growing customer base of over 11.5 lacs account holders. In our continuous endeavor to offer best of the class services to our customers we offer the following features:
 E-Instructions: You can transfer securities 24 hours a day, 7 days a week through Internet & Interactive Voice Response (IVR) at a lower cost. Now with "Speak to transfer", you can also transfer or pledge instructions through our customer care officer.
 Consolidation Demat Account: Dematerialize your physical shares in various holding patterns and consolidate all such scattered holdings into your primary demat account at reduced cost.
 Digitally Signed Statement: Receive your account statement and bill by email.
 Corporate Benefit Tracking: Track your dividend, interest, bonus through your account statement.
 Mobile Request: Access your demat account by sending SMS to enquire about Holdings, Transactions, Bill & ISIN details.

2.ICICI - Prudential:
India's Number One private life insurer, ICICI Prudential Life Insurance Company is a joint venture between ICICI Bank-one of India's foremost financial services companies-and Prudential plc- a leading international financial services group headquartered in the United Kingdom. Total capital infusion stands at Rs. 18.15 billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%.
Products offer: - Life, Retirement and Health
.
3.ICICI - Lombard:
ICICI Lombard General Insurance Company (ICICI Lombard) enhanced its leadership position among private sector general insurance companies with a market share of around 36% in the private sector as of Dec 06.
Here are the different products port-folio in which ICICI Lombard deal in:

 Home Insurance, Motor Insurance, Health Insurance, School Insurance,
Building, student, Travel, Marine, Petrol Pump, Stock
 Mobile Alerts: Receive SMS alerts for all debits/credits as well as for any request which cannot be processed.
 Dedicated customer care executives specially trained at our call centre, to handle all your queries.
 Countrywide network of over 235 branches, you are never far from an ICICI Bank Demat Services outlet.
4. Prudential ICICI Asset Management Company.

Prudential ICICI Asset Management Company (Prudential ICICI AMC) is one of the largest mutual funds in India with assets under management of Rs333.5bn as on Dec 31, 2006.


5. ICICI Venture Funds Management Company Limited.

ICICI Venture Funds Management Company Limited (ICICI Venture) raised two funds and strengthened its leadership position in private equity in India, with funds under management of over Rs.63bn. ICICI Venture achieved a profit after tax of Rs.0.50bn in fiscal 2006compared to Rs.0.32bn in fiscal 2005.









ICICI Group






BOARD OF DIRECTORS



K. V. Kamath
Managing Director and Chief Executive Officer


Chanda Kochhar
Joint Managing Director
& Chief Financial Officer


Madhabi Puri Buch
Executive Director
Mr. Sonjoy Chatterjee
Executive Director
V. Vaidyanathan
Executive Director



Glance At Different types of credit cards and features: ICICI Bank

ICICI Bank - Platinum Premiere Credit Card:






Fea tures
• Personalized concierge Services like car rental, hotel referral and reservation, restaurant referral and reservation
• APR of 3.15% monthly w..e.f March 1st,2008
• Air accident insurance of up to Rs 40 lakhs.
• Fuel- surcharge waiver across all petrol pumps
• Fuel-purchase transactions on the card will not earn reward points from December 15, 2007
• Reward point on every Rs 100 spend
• High credit and cash limit
• I-Assist, 24x7 personal concierge services, offering a host of benefits.
ICICI Bank – Titanium Credit Card:










Features
• Freedom from Fuel surcharge, across all petrol pumps, anywhere in the country
• Relax in luxury, at Oberoi lounges across various international and domestic airports in India
• Up to 25% discount at major restaurants in top 6 cities (Mumbai, Delhi, Chennai, Kolkata, Bangalore, Hyderabad)
ICICI Bank - Solid Gold Credit Card:










Benefits
• Welcomed internationally at over 22 million merchant establishments.
• High credit limit and cash limits.
• Dial-a-Draft at 2.5% of the draft amount subject to a minimum of Rs.300.
• Lifetime Balance Transfer offer: 0.75% for first 6 months (9% p.a.), followed by 1.49%p.m. (17.88% p.a.) thereafter.

ICICI Bank - Signature Credit Card:






Features
• A powerful rewards program: 5 points on every international spend of Rs.100, 4 points on every travel-related spend of Rs.100 and 2 points on every hotel-and dining-related spend of Rs.100
• Air accident insurance of up to Rs 3 crore.
• Special travel-related experiential offers, from flying a fighter jet to watching the Emperor Penguins in Antarctica.




ICICI Bank - Forum Credit Card:







Features
• 8 reward points for every Rs. 200 spent at Forum Card's partner outlets
• Rs. 250Gift voucher worth Rs.250 with the ‘Welcome’ kit
• Privileged parking & Privileged ticketing at PVR
• Special offers from time to time





ICICI Bank - King Fisher Airlines Credit Card:









Features
• 5 reward points on every Rs.100 spent at Kingfisher Airlines tickets / counters
• 2 reward points on every Rs.100 spent at other merchant establishments
• Reward points can be converted into King Miles. 1 Reward Point = 1 King Mile
• Fuel-surcharge waiver




ICICI Bank - Airtel Gold Credit Card:





Features
• 2 reward points for every Rs.100 of AirTel mobile bill, for payment through the credit card
• 3 reward points for every Rs.100 of AirTel mobile bill, for payment through Standing Instruction on the card
• Reward points against HPCL vouchers and ICICI Bank Xpress Rewards Booklet







ICICI Bank - Visa Mini Card:








Features
• A set of accessories – namely a Card casing, lanyard and key ring – come absolutely free with the Mini-Card. Fabulous offers on Nike, Provogue, Cupid Jewellery from TBZ, Pizza Corner and Rediff merchandise. Regular features of ICICI Bank Sterling Silver Card.




ICICI Bank - Sterling Silver Credit Card:



• Dial a Draft at 2.5% of the draft amount subject to a minimum of Rs.300.
• Lifetime Balance Transfer offer: 0.75% for first 6 months (9% p.a.), followed by 1.49% (17.88% p.a.) thereafter.
• Most powerful catalogue-based Rewards Programme.
• Comprehensive travel benefits.
• A powerful Gold Rush lucky draw offer that gives over 400 gms of Gold as prize money every month on spends of over Rs.500/- per month*
• Most attractive EMI offer at just 7.5% interest p.a. with no processing fee - available with just phone call with no guarantor.





ICICI BANK -FUTURE CARD :








Features:
BIG BAZAR
• 1Kg sugar free-first 6 month.
• 3% off on food-first 3 month.
• 15% off on fashion-first 3 month.
• 10% off on general merchandise.
HPCL
• 2.5% fuel surcharge waiver on selected HPCL outlets.
PANTALOONS
• Rs 100 off on purchase above Rs 500.
• Rs 200 off on purchase of shirts/t-shirts worth Rs 1000 and above.
DEPOT
• Rs 50 free from Exclusive Depot collection per month.
FURNITURE BAZZAR
• Gift worth Rs 250 free on purchase above Rs1000 spent per month.
• 10% cash Back on purchase above 10K to 50K.

ELECTRONICS BAZZAR
• Head phone worth Rs 199/- with every purchase through Future card at E Zone within the first 6 month.

APPOLLO HEALTH & LIFESTYLE
• 50% off on special package for the first 3 months.
• 15% off on health check up for the first 6 months.
• 20% off on diagnostic check up for the first 6 months.


VLCC
• 1face/body firming session plus counseling worth Rs 2000 free-can be availed once in 12 months.
• 30% discount on slimming /beauty / Hari package for the first 6 months.
• 15% off on RBS (salon service) for the first 6 months.














SWOT Analysis

Strength/Opportunity
 Strong economic growth would generate higher demand for funds pursuant to higher corporate demand for credit on account of capacity Expansion in international operations, increasing retail customer base, debt syndication business and credit linked fees would fuel fee base income for the bank.
 Increasing PLR by major banks in the industry would help the bank to maintain its margins.
 Strong relationship with major corporate house would help bank to sustain its growth rates.
 Value unlocking in the banks’ subsidiaries could generate cash for further credit growth.
Weakness/ Threats:
 Slow down in domestic economy would pose a concern over credit off take, thereby impacting earnings growth.
 Stiff competition, especially in the retail segment, could impact retail growth of ICICI Bank and hence slowdown in earnings growth.
 Contribution of retail credit to total bank credit stood at 69%. Significant thrust on growing retail book poses higher credit risk to the bank.



OTHER SECTORS OF ICICI


ICICI Prudential AMC Company is a joint venture between ICICI Bank, a premier financial powerhouse and Prudential plc, a leading international financial services group headquartered in the United Kingdom. ICICI Prudential was amongst the first private sector Mutual Fund companies to begin operations in December 2000 after receiving approval from Mutual Fund Regulatory Development Authority(IRDA).
ICICI Prudential's equity base stands at Rs. 9.25 billion with ICICI Bank and Prudential plc holding 74% and 26% stake respectively. In the financial year ended March 31, 2005, the company garnered Rs 1584 crore of new business premium for a total sum assured of Rs 13,780 crore and wrote nearly 615,000 poRBI BONDies. The company has a network of about 56,000 advisors; as well as 7 bancassurance and 150 corporate agent tie-ups. For the past four years, ICICI Prudential has retained its position as the No. 1 private insurer in the country, with a wide range of flexible products that meet the needs of the Indian customer at every step in .

ICICI Prudential Asset Management Company (AMC) is a child of two of the strongest names in the world finance market - Prudential PLC of UK and ICICI Bank India. Incepted in 1998, ICICI AMC Ltd is already a pre-eminent name in investment sector of India. With just 2 funds under management in 1998, ICICI Prudential mutual fund count has grown to 35 in the past decade.
Get the services of full-time, professionally trained and well-experienced investment professionals for managing your funds at ICICI Prudential Asset Management Co. Whats more you can also get personal consultations at the customer service segment with information to all your queries. Complete transparency is rendered in every investment by ICICI Prudential Advisor. Prompt liquidity at the net asset values (NAV) in open-ended schemes makes ICICI Prudential Mutual Funds a popular choice among investors.



ICICI AMC online services include a Pru Tracker that helps the customers access direct information about their investments along with provision for online transactions that include buying a plan, redeeming or even switching to a more appropriate one. Along with this, you also get an Online PoRBI BONDy Planner and a NAV Query segment that fulfills the promise of complete security and transparency by ICICI Prudential Asset Management Company India. For further information you can go to icicipruamc.com. For any information regarding the other trusted products by ICICI Prudential or ICICI Bank India, browse through our subsequent pages on each, links to which are provided below.

The 5-star rated funds of ICICI Prudential AMC are as follows:
• ICICI Prudential Gilt Treasury
• ICICI Prudential Dynamic
• ICICI Prudential Infrastructure
• ICICI Prudential Liquid Super Inst
• ICICI Prudential Liquid Inst
• ICICI Prudential Index Retail
• ICICI Prudential Gilt Investment PF
Speaking on the ratings, Mr. Sankaran Naren, CIO – Equity, ICICI Prudential AMC said “These ratings are a testimony of prudent fund management and efficient portfolio strategy. ICICI Prudential AMC has always taken its fiduciary responsibility of managing investor wealth with high commitment and in line with the mandate of the fund. This has helped us build sound portfolios with high risk adjusted return potential”
ICICI Prudential AMC announced the launch of ICICI Prudential Focused Equity Fund. The Fund is an open-ended equity scheme that aims to maximize long-term capital appreciation by investing in equity and equity related securities of about 20 companies.

The fund’s stock picking universe will comprise of Top 200 companies in terms of Market Capitalization from the companies listed on the National Stock Exchange of India Ltd. (NSE). The Scheme seeks to capture the best opportunities that the market presents, without any sector bias.
Speaking on the new fund, Mr. Nimesh Shah, Managing Director, ICICI Prudential Asset Management Company Ltd said, "Diversification in equity funds plays a key role in mitigating the risks . However, excessive diversification also runs the risk of diluting the potentially higher returns. It is thus critical that the number of stocks in a fund are restricted to achieve optimal diversity. ICICI Prudential Focused Equity Fund has been structured using this key insight to provide the investors with the possibility of high returns through limited risk. "

He further added, “Being India’s one of the leading fund house ICICI Prudential AMC aims to offer relevant products to investors and under current market conditions ICICI Prudential Focused Equity Fund is an example of the same.”

The Scheme will focus on the following investment strategies –

Large Cap Orientation

The fund seeks to buy stocks of companies that it believes are
• Profitable and leaders in the industry in which they operate
• Have rapid growth potential over the next 3 to 5 years
• Have superior proven management and solid balance sheets





Focus

• Potential to generate Alpha from being over weight on certain high conviction picks
• The portfolio could take exposure to any particular theme and has the flexibility to choose between stocks across themes / sectors / investment styles

Bottom-up Stock Picking

• Intrinsic value arrived at after intensive, internal research; reference to analyst reports and face-to-face meetings with management to analyze company strengths, business model, sustainable competitive advantages and ability to grow.






ICICI Prudential Banking and Financial Services Fund

INVESTMENT OBJECTIVE
ICICI Prudential Banking and Financial Services Fund is an open-ended equity schemethat seeks to generate long-term capital appreciation to unit holders from a portfoliothat is invested predominantly in equity and equity related securities of companiesengaged in banking and financial services.

ASSET ALLOCATION PATTERN:
The fund manager will invest between 70-100% of funds available in Equities andEquity Related Securities of companies that are engaged in Banking and FinancialServices Sector and the rest 0-30% of its net asset will be invested in the debt and money market instruments.

RISK PROFILE & SUITABILITY:
The risks associated with the portfolio will be higher than the diversified fund. Thescheme being sector specific will be affected by the risks associated with the Bankingand finance sector. As the scheme focuses on financial services and banking sector,concentration risk is high.
The Scheme should be considered as a long-term investment for the aggressive portio of a well-diversified portfolio. The Scheme is appropriate for those investors who havea high-risk appetite and seek for an aggressive equity scheme that could boost overallportfolio returns over the long term.

PROMOTERS
ICICI Bank
ICICI Bank is India’s second-largest bank with total assets of about Rs.112,024 crore and a network of about 450 branches and offices and about 1750 ATMs. It offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries and affiliates in the areas of investment banking, and non- Mutual Fund, venture capital, asset management and information technology. ICICI Bank posted a net profit of Rs.1637 crore for the year ended March 31, 2004. ICICI Bank’s equity shares are listed in India on stock exchanges at Chennai, Delhi, Kolkata and Vadodara, the Stock Exchange, Mumbai and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE).
Prudential plc
Established in London in 1848, Prudential plc, through its businesses in the UK and Europe, the US and Asia, provides retail financial services products and services to more than 16 million customers, poRBI BONDyholder and unit holders worldwide. As of June 30, 2004, the company had over US$300 billion in funds under management. Prudential has brought to market an integrated range of financial services products that now includes assurance, pensions, mutual funds, banking, investment management and general Mutual Fund. In Asia, Prudential is the leading European Mutual Fund company with a vast network of 24 and mutual fund operations in twelve countries - China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan, Thailand and Vietnam.
The company has six Bancassurance tie-ups, having agreements with ICICI Bank, Federal Bank, South Indian Bank, Bank of India, Lord Krishna Bank and some co-operative banks, as well as over 150 corporate agents and brokers. It has also tied up with NGOs, MFIs and corporates for the distribution of rural poRBI BONDies and organizations like Dhan for distribution of Salaam Zindagi, a poRBI BONDy for the socially and economically underprivileged sections of society.
ICICI Prudential has recruited and trained about 2,14,000 Mutual Fund advisors to interface with and advise customers. Further, it leverages its state-of-the-art IT infrastructure to provide superior quality of service to customer
ICICI Direct.com
ICICIdirect.com is a brand under ICICI Brokerage Services Ltd. that offers online share trading facility for trading in Indian equity markets. It is a 3-in-1 account, connecting all the accounts i.e. bank, broking and demat (essential for investing in Indian markets) to each other. Thereby, it enables seamless and hassle free settlement for its clients.
ICICI.direct was launched in January 2000 and started its operations in April 2000. Now we pro duly service over 6 Lakh customers.
The following are the products that are currently being offered on ICICI Direct:
d. Equity Trading
e. Initial PubRBI BOND Offer (IPO)
ICICI - Prudential:

India's Number One private insurer, ICICI Prudential Mutual Fund Company is a joint venture between ICICI Bank-one of India's foremost financial services companies-and Prudential plc- a leading international financial services group headquartered in the United Kingdom. Total capital infusion stands at Rs. 18.15 billion, with ICICI Bank holding a stake of 74% and Prudential plc holding 26%.

Products offer:- , Retirement, Health
.





ICICI - Lombard:

Here are the different products port-folio in which ICICI Lombard deal in:
 Home Mutual Fund, Motor Mutual Fund, Health Mutual Fund, School Mutual Fund,
building, student ,Travel ,Marine ,Petrol Pump, Stock
Demat account:
For each ICICIdirect account, there has to be one corresponding demat account, where the settlements of shares can be done. Since it is a complete online offering, for all the purchase transactions, shares will be credited to the linked demat account and for all the sale transactions, shares will be debited from the linked demat account only.
Demat Services
ICICI Bank Demat Services boasts of an ever-growing customer base of over 11.5 lacs account holders. In our continuous endeavor to offer best of the class services to our customers we offer the following features:
 e-Instructions: You can transfer securities 24 hours a day, 7 days a week through Internet & Interactive Voice Response (IVR) at a lower cost. Now with "Speak to transfer", you can also transfer or pledge instructions through our customer care officer.
 Consolidation Demat Account: Dematerialize your physical shares in various holding patterns and consolidate all such scattered holdings into your primary demat account at reduced cost.
 Digitally Signed Statement: Receive your account statement and bill by email.
 Corporate Benefit Tracking: Track your dividend, interest, bonus through your account statement.
 Mobile Request: Access your demat account by sending SMS to enquire about Holdings, Transactions, Bill & ISIN details.
 Mobile Alerts: Receive SMS alerts for all debits/credits as well as for any request which cannot be processed.
 Dedicated customer care executives specially trained at our call centre, to handle all your queries.








HYPOTHESIS
“Investment decisions of most of the High Net-worth Individuals are taken by their Chartered Accountants”

This is the hypothesis on which I have based my research on. After meeting few clients and collecting some data it was known that many of the clients are making their investment decisions through their Chartered Accountants, so it gave rise to this hypothesis that most of the clients make their investment decisions through theirs Chartered Accountants. So for this purpose only, I started meeting top Chartered Accountants on Bhubaneswar to know their personal tastes while they are investing. This was basically done to compare the personal investment pattern of the Chartered Accountants with the investment pattern of the HNI’s whom I had met. So my whole project is based on this hypothesis only and at the end it has proved to be quiet right one.
Now after establishing this hypothesis I started my research work by meeting the Chartered Accountants. I first got the list of the Chartered Accountants with their Addresses from ICAI (Institute of Chartered Accountants of India). From that list it was known that there are about 922 Chartered Accountants in , Bhubaneswar so it would have been very difficult for me to meet each and every Chartered Accountant of Bhubaneswar. Now it was decided to just target the top 30-40 Chartered Accountants and know their investment pattern. This was done to get the basic idea about their personal preferences while they are investing their money in the market.

The target Chartered Accountants were identified through various sources which included:
 Personal Sources
 References from Local Residents
 References from Clients
 References from other Chartered Accountants
 Some Random Selection from the list

I also designed the different questionnaire for Chartered Accountants and Clients to know their investment Pattern. The format of the Questionnaire is given below:

Comparison and relationship between the experience of the Chartered Accountants and Clients:



Now as we can see from the above chart that most of the Chartered Accountants (70%) have the experience of more than 15 years, so this means that many HNI’s prefer the Chartered Accountants with maximum of experience. This can be said from the fact that most of the Chartered Accountants that I have met are those with the clients who are also in my list of HNI’s targeted. So this emerges out to be a real fact in my project that most of the top Chartered Accountants in Bhubaneswar are the one with maximum of experience.

There is also another facet to it i.e. when we compare the experience of CA’s with the cycle of the companies which I have targeted a very interesting fact comes into picture i.e. companies which are quiet old have the Chartered Accountants who are experienced. This means that most of these companies do depend

on their CA’s and share good old relationship. This can be said from the fact that most of the companies don’t like to change their Chartered Accountants too often as most crucial information of the business i.e. financial is with these professionals only.



Above is given the chart of the Company Analysis, which shows that most of the companies that I have targeted are with the of more than 15 years. Above we have already seen that most of the Chartered Accountants of these Clients are also with the experience of more than 15 years. This is how we can say that there is a relation b/w the experience of clients and chartered accountants and most of the HNI’s do depend on their CA’s with maximum experience.

Analysis of the Investment Pattern of the Clients

Preferred Investment Instrument: Following is given the chart depicting the preference of the client for the various investment instruments available in the market:



We can see from the above chart that from the various instruments available in the market and preferences of the clients for these instruments. Following aspects can be known from the above chart:

 Mutual Fund plans emerge to be the most preferred investment instrument of the clients with maximum 35% of clients from all the clients preferring this as their

favorite investment option. This is the preferred instrument for the various reasons:
o Providing the clients safety for the future risks or uncertainty.
o With unit linked Mutual Fund plans now clients have the option of getting good returns with the cover traditionally provided by the Mutual Fund companies.
o RBI BOND emerges to be the favorite company of the clients due to trust on it in all these years and most of the clients think it to be safest being a RBI BOND sector unit. Another reason for the Clients preferring RBI BOND is lack of knowledge of the unit linked products and their benefits.

 Bank FD emerges out to be the second most preferred option for the clients to invest in the market. This is also dependant on various reasons which are given as under:
o Easy loans available against the Bank Fixed Deposits.
o Clients can withdraw their money at almost anytime giving them the option of maintaining Liquidity.
o With all this Bank FD also provides a decent return concerned the minimum of the risk in any of the available investment instruments.
o We have seen above in the analysis of nationalized vs. private banks that nationalized banks are the more preferred ones, this also adds weight to clients preferring Bank FDs due to trust build during all these years.

 Then, next preferred option for the clients is back into their business. This is mainly true for the capital intensive industries like leather industry where most of the money of almost all the clients is going back into their business as that is where they get most return with minimum of risk. Where as in some less capital intensive industries investment back into business is still there but only according


to the requirement or sometimes for the various strategies adopted like diversification etc.

 Mutual Funds and RBI Bonds come next in the preference list of the clients. This is mainly due to lack of trust of clients in Mutual Funds and for the RBI Bonds low return is the reason for less preference.

 Real Estate and Gold emerge as the least preferred option for the clients, this is due to the reason that real estate does demand lot of investment and there is money blockage for quiet long period which blocks the liquidity in the hands of the clients. While gold is not actually used as investment option by most of the clients but only one of two clients are investing in gold for the investment purposes.











Analysis of the various investment instruments



We can see from the above chart that there are majority of clients (from the clients who have disclosed this data) who are preferring the long term fixed deposits as their favorite option due to the return expected from it.






In the above chart preference of the clients for the various mutual funds is depicted. In this Mutual Fund preference Franklin Templeton, Reliance and Prudential ICICI emerge as the winners closely followed by HDFC Mutual fund. While some clients like to invest in other mutual funds as well.





While investing their money in the Mutual Funds, majority of clients are looking at the return of b/w 15-20% keeping the relative risk in mind. This means that the clients are ready to take some risks for better returns while investing in the various mutual funds.






Analysis of the Investment Pattern of the Chartered Accountants

Preferred Investment Instrument: Following is given the chart depicting the preference of the chartered accountants for the various investment instruments available in the market:



Following facts emerge from the above pie chart:

 Unit Plan to be the most preferred option for the chartered accountants. Reason for this preference is almost same as the reason for the clients i.e.

Assurance against uncertainty of future
Returns provided by the unit linked plans provide them with a good value for their money
Tax Benefits

 Bank Fixed Deposit emerges to be the second most preferred instrument of the chartered accountants. This preference is for the following reasons:
Safe and easily accessible instrument
Easy loans available against the Bank Fixed Deposits.
Virtual Liquidity
With all this Bank FD also provides a decent return concerned the minimum of the risk in any of the available investment instruments.

 Mutual funds and Trading markets come next in the preference of the various investment instruments. This is mainly preferred due to high returns associated with these instruments. Being professionals chartered accountants are also well aware of the risk attached to these instruments and they are fully capable of making the right judgments

 Then comes the real estate, gold and RBI Bonds. Real estate needing high investment and blocking the money for quiet long period is not actually preferred by chartered accountants too much. Gold is mainly used for personal purposes more than the investment purpose. RBI Bonds look to be good option for the chartered accountants but low returns attached to these bonds make them little less attractive

Validity of the Hypothesis:

Now after analyzing the various things related to the investment patterns of the clients and the chartered accountants, it is time to check the validity of the hypothesis which was established on which whole project was based i.e. “Investment decisions of most of the clients are taken by their chartered accountants”. We have already analyzed the investment patterns of both clients and the chartered accountants, now it is the time to compare the investment patterns of both of them and chalk out the similarities and the differences between their investments preferences. Post this comparison we will be able to establish whether hypothesis holds good or not.











From the above two charts we can see that there are quiet a few similarities between the investment pattern of both clients and the chartered accountants. Following are listed the various similarities in the preferences for the investment instruments of these two:
 Both clients and the chartered accountants put maximum of their money in unit linked plans/Mutual Fund. Reasons for their preferences are given in the analysis of both of them individually.
 Both clients and the chartered accountants give their second preference for the bank fixed deposits and mainly with the similar of the reasons attached to it.
 Gold, Real Estate and RBI Bonds are the least preferred option of majority of the clients as well as the chartered accountants.



These are the basic similarities in the investment preferences of the clients and the chartered accountants. With these similarities there also exist some differences in their investment tastes as well which are listed as under:

 Many chartered accountants like to invest in the mutual funds and share markets directly as well but this investment option is not that much popular amongst the clients and there are few reasons attached to this preference:

Chartered accountants being professionals know more about these instruments
Clients, due to their lack of total know-how of these instruments, just like to stay away from these instruments
Clients who have very high income and the turnover like to invest in these two instruments as they are more open to take risks whereas this trend is not present there in the clients with not that great turnover.
Also chartered accountants with sound knowledge about these instruments are able to evaluate these instruments much better and most of the clients who are investing in these instruments are doing this through their chartered accountants.

 Another difference in the taste of the clients and the chartered accountants is that clients invest lot of their money back into their business but this is not the case with the chartered accountants.

So after studying the above similarities and the differences in the preferences of the chartered accountants and the clients, it can be seen that majority of the tastes of these two do match with each other.

Now to know about how much do clients depend on their chartered accountants for their investment decisions. Following charts will make this point very much clear:


Preferred Investment Consultant of the Clients




Additional Services provided by chartered accountants to clients



From the above two charts it will become very much clear that majority of the clients prefer their chartered accountants as their investment consultant. To add to this the second closest choice seems to be the internal advisors and it can be incorrect to say that clients depend on their chartered accountants with only this much of data. So I would like to add to this that many of the clients whom I have met have in their companies full time chartered accountants and they are consulted for taking the investment decisions. So it can be said from this fact that chartered accountants are the most preferred investment consultants for the companies whether they are internal or auditor. Also with this clients not only take the basic services of their chartered accountants that is auditing but with


addition to that clients also like to consult their chartered accountants for additional services also. These services include:


 Financial Advisor
 Investment Consultant

So from all the above analysis that has been illustrated it has become quiet clear that clients do depend on their chartered accountants for their investment decisions. This can also be said from the similarities which exist in the investment patterns of both clients and the chartered accountants. This means that chartered accountants do have an influence on the investment decisions of the clients and clients also depend on their chartered accountants for their investment decisions.

Hence this proves that the hypothesis which I had established stands valid and clients do depend on chartered accountants for their investment decisions. Following are the reasons for which clients like to depend on their chartered accountants for these vital decisions:

 Chartered accountants are the professionals who have the most of the financial information of the clients with them so they know best what can be done to additional income of their clients to fetch the maximum returns.
 Managing the accounts of the clients, chartered accountants can tell which can be the best instrument for the clients to provide them the various benefits like- tax benefits, maximum returns, safe investments etc
 As we have studied and analyzed above that clients and chartered accountants share good long relationships so this builds up the trust between these two and clients depend on their chartered accountants much more than only an auditor.

 It is this relationship which also helps clients to depend on their chartered accountants for additional services like financial advisor and investment consultant.





Major Findings

Following are the things which have come into picture after studying and analyzing the investment pattern of the clients:
 RBI BOND is the favorite Mutual Fund partner of the clients: Well this is just like stating the universal fact and nothing needs to be said about it. RBI BOND still is the name or the brand which has maximum trust in the mind of the Indians. But what I can add to this is the reason for which clients are mainly going for the RBI BOND. Following are the reasons which I feel about people having the bent of mind for the RBI BOND:
Trust built in all these years.
Client’s negative perception about the private Mutual Fund players.
Clients are continuing their policies from the time when no private player was present so this makes RBI BOND the undisputed leader.
Agent base of RBI BOND is really too vast to even compare it with any other Mutual Fund player.
Mindset of the clients is such that they take RBI BOND synonymous to the Mutual Fund product.
Majority of clients feel private players synonymous to the mutual funds as most of their product are related to the investment in the markets and thereby having more risks.
Lack of full information or knowledge about the actual private offerings.

 Nationalized banks are the more preferred to the private ones: This is another fact which has emerged during the project. It is something which again has various reasons attached to it:
Lack of availability of the private banks in the industrial areas
No advances provided to the clients for investment in their own business or in the raw material, but they mainly provide advances for the investment in the financial markets which results in less clientele.
Many additional services are provided to clients by nationalized banks like DD commission etc. which help these clients to stick with these public banks.
Too many formalities are needed to deal with the private banks.





















RESEARCH METHODOLOGY




METHODOLOGY
This section of survey puts emphasis on the procedure that has been followed by me during the Research study. This facilitates a reader to understand the project work easily and clearly. The methodologies that have been used in the research study as follows.
 Research Design
 Sampling
 Data Collection
 Co –relation coefficient analysis
RESEARCH DESIGN:
The type of research design used by me to gather information or data for this project can be termed as Descriptive Research. This includes surveys and fact finding enquiries of different kind. Therefore I have adopted the questionnaire method and surveyed more number of people.
SAMPLING:
The research was done by sampling method . A representative sample represents the characteristics of the population instead of taking every element of population.
The basic task of the researcher is to decide on the sampling unit to be chosen which a crucial judgment. The following questions are to be answered first before choosing the sample units.



 Sample size
 Sample area
 Method of sampling
SAMPLE SIZE:
The total sample size is 150, out of which 100 samples have responded and are valid. There are 50 samples that are void and are not sufficient for the survey.
SAMPLE AREA:
The information is collected from the two places of bhubaneswar. These places are the most crowded and trading centers of bhubaneswar. ‘Big Bazar’ is mostly inhabited by the localities and company service holders. The people preferred to buy all types of goods and products. This place consists of vegetables, groceries, garments, electronics goods and home essentials. Here the people are not well educated. They didn’t understand the questions. I have worked hard to make them understood. The people are not also cooperative.
I collected samples from ‘Pantaloons’ which is nearer to the Big Bazar. This place is also consists of vegetables, groceries, garments, electronics goods and home essentials.. The people are well educated and well civilized. People used to prefer for buying vegetables and groceries. Here the response was quite good.


SAMPLING METHOD:
Simple Random Sampling: This type of sampling is also known as chance sampling or operability where is and every item in the population has an equal chance of inclusion in the sample and each one of the possible samples, in case of finite universe, has the same probability of being selected.
DATA COLLECTION:
Primary Data- Primary data were collected through a well structured questionnaire designed separately for consumers.
Secondary Data- These data were collected from various web sites like www.google.com, www.marketresearch.com, www.icicibank.com








Data analysis

Analysis of data
A. TABULATION OF DATA
B. COMPUTATION OF DATA
C. GRAPHICAL REPRESENTATION OF DATA
TABULATION:

Here I have considered the seven most important questions of the questionnaire prepared by me:

TABLE 3.1
Respondents Code Name Q.1 Q.2 Q.3
Q.4 Q.7 Q.10 Q.11
RC001 a a a a a a a
RC002 a b b a c b
RC003 a a a a a a a
RC004 b b b
RC005 a e c b c b
RC006 a b a a b b
RC007 a a d b a d b
RC008 b b a
RC009 a a a a a a a
RC010 a e c b c b
RC011 a a c b a d a
RC012 a d c a b b
RC013 a a c a a b b
RC014 a d c a a b
RC015 a d a a b a
RC016 a a b b b b b
RC017 a b b b c b
RC018 a c a a a b
RC019 b a a a
RC020 a b a a c a
RC021 b a b
RC022 a a a a a b b
RC023 a a c a b c a
RC024 a a b a a b b
RC025 a b b a c a
RC026 a c d a c b
RC027 a a a b b b a
RC028 b c d a c b
RC029 a b b a b a
RC030 a c d a a b
RC031 a a b a a b b
RC032 a c b a b b
RC033 a d c b a b
RC034 a a d b a c b
RC035 a a a a b b a
RC036 a a c a a c b
RC037 a a c b a a b
RC038 a d a a a a
RC039 b b b
RC040 a d b a c b
RC041 b b c
RC042 a c a b a b
RC043 a b a a c a
RC044 a c a a c b
RC045 a e c b c a
RC046 b b c
RC047 a b b a c a
RC048 a a b b a b b
RC049 a a a a a a a
RC050 a c d a b a
RC051 a a c a b b b
RC052 b b c b
RC053 a a d b a a b
RC054 b a d
RC055 a b d b b b
RC056 a a d a a b a
RC057 a a b b a d b
RC058 a a a a a c b
RC059 b a
RC060 a a b b a c a
RC061 a b b a a b
RC062 a c c a a b
RC063 a b c b d b
RC064 a d c a b b
RC065 a d a b c b
RC066 a b b b a b
RC067 a c b a c b
RC068 a b a a d a
RC069 a b c a d b
RC070 a b d a a b
RC071 a c a a c a
RC072 a e d b c b
RC073 a b c b b a
RC074 a d d a a b
RC075 b b d
RC076 a b c a a
RC077 b b
RC078 a c a a a b
RC079 b b c
RC081 b a c
RC081 a b c a c b
RC082 b b d a b b
RC083 a a d a b a a
RC084 a d c a b a
RC085 a b d a a b
RC086 b a a
RC087 a a c a a b a
RC088 b b a b a b
RC089 a c b a a b
RC090 b b c
RC091 a e b a c b
RC092 a b a a b a
RC093 b a b
RC094 a e b a a a
RC095 a a b a a a a
RC096 b a b
RC097 a a b a b a b
RC098 b a a b b c a
RC099 a a b a a c a
RC100 b b




COMPUTATION:

Arithmetic mean between age group and no. of consumers aware of all the offers:
TABLE 3.2
Age group x F Fx
15-30 22.5 21 472.5
30-45 37.5 29 1087.5
45-60 52.5 19 997.5
60-75 67.5 10 675
∑f= 79 ∑fx=3232.5


Arithmetic mean = 40.99= 41
From the calculation it is found that the average age of consumers aware of all the offer is 41.
Notes:
X = mid value
F= frequency = no. of people
Correlation coefficient between no. of people surveyed on the basis of age and people who are using credit cards:
TABLE 3.3
Age group X Y X*X Y*Y XY
15-30 23 21 529 441 483
30-45 33 29 1089 841 957
45-60 31 19 961 361 589
60-75 13 10 169 100 130
∑X=100 ∑Y=79 ∑X*X=2748 ∑Y*Y= 1743 ∑XY= 2159

r = 0.864
There exist a positive correlation between age and people who are using credit cards .This shows that there exists a direct relationship between age & those are using credit cards.




GRAPHICAL REPRESENTATION OF DATA

Q.1. Are you aware of the offers given by ICICI credit cards?
TABLE
Yes 79
No 21





Q.2. How do you know about the offers given by icici bank credit card?
Newspapers 34
Leaflets 37
Mobile Display Vans 13
TV ads 9
Others 7

TABLE




DIAGRAM













Q.3. What difference do you find in offers between ICICI Bank credit cards & other’s ?
TABLE

Quality 12
Credit limit 44
Interest charges 34
Service 10

DIAGRAM












Q.4. Are you aware about icici future card?
TABLE

Yes 77
No 23


DIAGRAM



Q.5.How many times do you use credit card?
TABLE

Once a month 20
Twice a month 28
Weekly 25
Quarterly 27


DIAGRAM















ANALYSIS EXPLORATION




Research Findings

According to my survey report, I found that

 There is a great opportunity for the ICICI Bank Ltd. in credit card business because according to the research findings I found only 17% credit holders are there in Bhubaneswar and most of the areas are untouched right now. If they fulfill the need of customer then they a great response from the customers. ICICI Bank is only bank who is doing their open market business.
 Most of the customers don’t know the whole rule and regulation of proper handling of the credit card.
 Most of the customers are also not satisfied with interest rate of the bank.
 People of Bhubaneswar mostly opened their account on State Bank of India, Standard Chartered Bank, ICICI Bank, HDFC Bank , Others.





The above pie chart shows that the number of credit card holders of ICICI Bank is more as compared to other manks.

 People of Bhubaneswar prefer to have credit card of the following banks:-
1. SBI
2. ICICI Bank
3. HDFC
4. STANDARD CHARTERED
5. OTHERs



According to above graph the major numbers of people are interested
to have ICICI Bank credit card because of higher credit amount, good offers and high percentage of security.
 The following banks are ranked according to services they are providing:
1. ICICI Bank
2. HDFC Bank
3. STANDARD CHARTERED Bank
4. Axis Bank
5. SBI

 Best Services provided by the Banks by the perceptions of credit card holders in Bhubaneswar:




According to this pie chart it shows that the ICICI Bank is ranked as number one in providing services like a) Quick services b) complete solution for the customers c) Less documentation d) customer care service.

 Problems facing by customers of ICICI Bank are follows:-
1. High risk
2. Hidden Information
3. False Commitment made by the Executives
4. Less assurance
5. Less Securit
















Suggestion


Campaigning for awareness for credit cards for rural sector.
Bank has to give all details to the customers on time and they have to give facility to the customers that they can get the details of their account when they want in free of cost or after paying a very nominal amount because right now the fee for getting account details is very high.
The company has to clarify all the charges at time of issuance of the credit card because many times some charges are unknown to the customers and when the company is charging those fee it comes as hidden cost for the customers and these hidden cost gives a bad impression of ICICI Bank services to the customers because of this the many customers surrendering their card and its loss for the company.
Products should be more competitive than the competitor’s product taking into view customer loyalty.
No false commitments should be made and hidden information regarding credit card usage should be unveiled to customers at the time of approaching and convincing them.
More focus on small and medium class business group.
Quick and competitive service for business group should be taken.
Proper advertisement would be requiring for the ICICI to aware the people.
Recruiting of more qualified agents to spread the network.
Rather than dissatisfied customer to complain, the company should actively seek both positive and negative perceptions of the customers in advance complain.
There should be significant emphasis on the importance of consumers’ desire for convenience and the value of time.
Use problem solving approach – employee should Pay attention to the customer then the products.











































Conclusion
Our goals in business should be that our customers should be satisfied and even delighted with what we have provided them .Satisfying your customers results in repeated business and referrals for new business. Dissatisfied customers can result in complains, returns and negative publicity, causing you to lose money and have fewer customers in the future in the long term.

Many organizations agree that customer satisfaction is difficult to measure. There are a number of tests and programs available on the market to try to understand customer satisfaction levels .one of the most popular is a customer satisfaction survey .Unfortunately many of the customer satisfaction surveys distributed by organizations never make it back to the organization, and if they do, they are obsolete because they are outdated and do not represent current customer satisfaction levels.

After the large study of all the current situation of the market I come to this conclusion that the bank has a great opportunity in the Bhubaneswar market because only 17% credit card holders are available in the market. So the company has to try to remove the some general drawbacks of credit card by giving better services to the customers. The company has the general drawbacks in banking services and they have to some change some rule regulation that the work beautifully for the customers. Bank has to give some attractive offer to the customer to attract the customer. ICICI Bank has the maximum branches in private sector bank and it has large customer base so ICICI Bank so they can do much work for the customers and for their business.

ICICI Bank Limited is an emerging banking sector. It can be a major market player in next 2-3 years by its brand strategy, marketing strategy, product differentiation etc.

Despite of all the major competitors the products ICICI Credit card is the unique products, which can fulfill the requirements of the customer. Despite of all the hazards, I feel immense pleasure to be an intern of ICICI Bank Limited.











BIBLIOGRAPHY
Research Methodology- C.R Kothari, edition-2004, reprint 2006
Publisher – New Age International (P) Ltd, publishers
Methods of Data Collection, page no- 95
Sampling Fundamentals, page no- 152
Business Statistics- S.L Agrawal, S.L Bharadwaj, Inder Kumar
Kalyani Publishers, edition- 2000
Measures of Central tendency- 133
Fundamentals of Statistics- S.C Gupta
Himalaya Publishing House
Sixth revised and enlarged edition, April 2004
Correlation, page- 8.1
Marketing Management- Philip Kotlor, edition-tenth edition….April 2002,.
Websites: www.googlee.com
www.icicibank.com
www.indiatimes.com
www.sbi.com
www.icici prulife.c
APPENDIX

Dear Sir/Madam

I am pradipt Mohanty from IT EXSICUTIVE conducting a market research to know the awareness and behavior towards icici bank credit cards. Kindly extend your cooperation in filling this questionnaire and enable us in doing the research successfully.

Questionnaire
Name of Employee:-

Occupation:
Salaried
Business
Housewife
Students

Gender:- Male / Female

Age:-

Monthly Income-
(i) Less than 5000
(ii) More than 5001-10000
(iii) More than 10001-15000
(iv) More than 15000

1. Are you a current credit card holder of any bank?

a) Yes
b) No

2. In which bank you are having credit card?

a) ICICI

b) State Bank of India

c) Standard Chartered Bank

d) HDFC Bank

e) Others

3. What aspect you look for purchasing through credit card?

a. price

b. Scheme

c. services

d. Quality

4. DO you have any credit card of ICICI Bank?

a) Yes

b) No

5. Are you satisfied with the services provided by this Bank?

a) Yes

b) No

6. Are you aware about Big Bazaar ICICI Credit card / future card?

a. Yes

b .No


7. Do you believe “Buying through credit card is expensive”?
a. Yes

b. No

8. Please grade the services provided by ICICI Bank in terms of credit cards.
a. Very good

b. Good

c. Average

d. poor


9. Do you find any difficulties using icici credit cards ?

a. Yes

b. No

10. What difference do you find in offers between ICICI Bank credit card & other?
a) Quality
b) Credit limit
c) Interest charges
d) Service

11. Are you aware of offers given by ICICI credit cards?

a. Yes

b. No



12. How do you know about the offers given ICICI bank credit card ?

a) Newspapers
b) Leaflets
c) Mobile Display Vans
d) TV ads
e) Others

13. What difference do you find in offers between ICICI Bank credit card & other?
a) Quality
b) Credit limit
c) Interest charges
d) Service
14. Do you get the sufficient number of business firms for swapping the card in your city?
(a) Yes
(b) No
(c) Can’t Say
15. Do you satisfy with the payment period of credit card?
(a) Yes
(b) No
(c) Can’t Say
16. What you think about the hidden charges?
(a) Comfortable
(b) Not Comfortable
(c) Can’t Say
.
17. Do you aware of all rule and regulation of your credit card?

(a) Yes
(b) No
(c) Can’t Say

18.What is most important thing the bank should improve to enhance their service in your sense?
(a) Increase Payment Period
(b) Reduce Interest Rates
(c) Hidden Costs
(d) Increase

19. What the other facility do you want in credit card?
____________________________________________________________________________________________________________________________________________________________




-:THANK YOU:-
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