Arushi Project

A STUDY ON LOANS AND ADVANCES (SBM)
CHAPTER-1
INTRODUCTION
FINANCE
Finance is the lifeblood of the business. In our present day economy, finance is
defined as the provisions of the time when it is required. In fact, finance is so indispensable
today that just as circulation of blood is essential in the human body for maintaining life,
finance is very essential to smooth running of all the activities. Finance remains as a focus of
all activities. Without adequate finance no enterprise can possible to accomplish its
objectives. The success of enterprise depends upon the available and optimum utilization of
finance. All business organization requires finance and finance is one of the most important
resources of an organization.
DEFINITION:
The financing function includes day-to-day concern for the use and control of funds
as well as long range planning which is involved with determining future requirements for
fund and optimum uses to which it may be put. The financial policies of the firm or
exemplified in its basic decision about methods of financing growth; dividend distribution
policy, relation with lending institutions, economic evolution of alternative investments in
plant and equipments and other activities which involve uses or sources of funds.
- L.A. and C.E. Gubellini
Business finance may be broadly defined as the activity concerned with planning,
raising, controlling and administrating of funds used in the business.
- H. Guthman and H. Douggal
FINANCIAL MANAGEMENT
Financial management is the effective and efficient utilization of financial resources.
It means creating a balance among financial planning, procurement of funds, profit
administration and sources of funds. The financial management is defined as follows:
Dept. of Commerce & Management, .G.F.G.C. Dandinashivara
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DEFINITION:
Financial management is an area of financial decision making harmonizing
individual motives and enterprise goal.
- Weston and Brigham
Financial management is the application of the planning and control functions of the
finance function.
- Howard and Upton
OBJECTIVES OF FINANCE
The main objective of a business is to maximize the owner economic welfare. This
objective can be achieve by
1. Profit maximization
2. Wealth maximization
Profit maximization:
Profit is the engine that drives the business enterprise. It is also a measure of
efficiency of a business enterprise.
This objective of financial management states that these actions that increase profits
should be undertaken and those that decreases profit are to be avoided.
Wealth maximization:
Wealth is defined as net present value. Wealth maximization is the appropriate and
operationally feasible objective of enterprises. Wealth maximization means maximizing the
net present value of a course of action.
MEANING:
Bank is one of the financial institution which deals with the money and credit. It
accepts the deposits from the general public and they lend the funds to the needed public only
on demand.
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DEFINITION:
Prof. Kinley defines a bank as an establishment which makes to individuals such
advances of money as may be required and safely made and to which individuals entrust
money which is not required by them for use.
Meaning of Loans and Advances:

The term loan may be regarded as credit granted where the money is disbursed and
its recovery is made on a later date. It is the debt for the borrower. While granting loans,
credit is given for a definite purpose and for a predetermined period. Interest is charged on
the loan at agreed rate and intervals of payment.
The term advance refers to a credit facility granted by the bank. A credit facility
repayable within one year may be known as advances. Banks grant advances largely for
short-term purposes, such as purchase of goods traded in and meeting other short-term
trading
Nature and Security of Loans and Advances:

To ensure the safety of funds lent, the first and most important factor considered by a
bank is the capacity of borrowers to repay the amount of loan. The bank therefore, relies
primarily on the character, capacity and financial soundness of the borrower. But the bank
can hardly afford to take any risk in this regard and hence it also has the security of tangible
assets owned by the borrower. In case the borrower fails to repay the loan, the bank can
recover the amount by attaching the assets. It can sell the assets offered as security and
realize the amount. Thus from the view point of security of loans, we can divide the loans
into two categories:
(a) Secured loans and

(b) Unsecured loans.
(a)Secured loans: Are those which are granted against the security of tangible assets, like
stock in trade and immovable property.
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(b) Unsecured loans: Are those loans which are not covered by the security of tangible
assets. Such loans are granted to firms/institutions against the personal security of the owner,
manager or director.
There are various types of securities which may be offered against loans granted, but
all of those are not acceptable to the banks. The types of securities generally accepted by the
bank are the following:
1)
2)
3)
4)
5)
6)
7)
Tangible assets such as plant and machinery, motor-van, etc.

Documents of title to goods, like Railway Receipt (R/R), Bills of exchange, etc.
Financial Securities (Shares and Debentures)
Life-Insurance Policy
Real estates (Land, building, etc).
Fixed Deposit Receipt (FDR)
Gold ornaments, Jewellery etc.
Procedure of granting Loans and Advances

The procedure of applying for and sanction of loans and advances differs from bank
to bank. However, the steps which are taken in SBM are as follow:
(I) Filling up of loan application form

Each bank has separate loan application forms for different categories of borrowers.
When you want to borrow money from a bank, you will have to fill up a loan application
form available with the bank free of cost. The loan application form contains different
columns to be filled in by the applicant. It includes all information required about the
borrower, purpose of loan, nature of facility (cash-credit, overdraft etc) required, period of
`repayment, nature of security offered, and the financial status of the borrower. A
running business limit may be required to furnish additional information in respect of :
assets and liabilities
profit and loss for the last 2 to 3 years.
The names and addresses of three persons (which may include borrowers, suppliers,
customers and bankers) for reference purposes.
(II)
Submission of form along with relevant documents
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The loan application form duly filled in should be submitted to the bank along with
the relevant documents.
(III)
Sanctioning of loan
The bank scrutinizes the documents submitted and determines the credit worthiness
of the applicant. If it is found to be feasible, the loan is sanctioned. If the loan is for Rs 5000
or less,
normally the Branch Manager himself can take the decision and sanction the loan. In case the
amount of loan is more than Rs 5000, the application is considered at regional, zonal or head
office level, depending on the amount of loan.
(IV)
Executing the Agreement

When the loan is sanctioned by the bank and the borrower is informed about it, he
will have to execute an agreement with the bank regarding terms and condition for the
amount of loan raised.
(V)
Arrangement of Security for Loan

The borrower will now arrange for security against the loan. These securities may be
immovable properties, shares, debentures, fixed deposit receipts, and other documents, like,
Kisan Vikas Patra, National Savings Certificate, as per agreement. When the borrower
completes all the formalities, he is allowed to get the amount of loan/advance/ over draft as
sanctioned by the bank. In case of discounting of bills, the bank credits the amount of bill to
the customers account before the realization of the bill and thus, makes available the fund. In
case, the bill is dishonored on due date, the amount due on the bill together with interest and
other charges are payable by the party whose bill is discounted.
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CHAPTER-2
RESEARCH DESIGN OF THE STUDY
Research:
Research is the process of systematic and in depth study or search for any particular
topic subject on area of investigation backed by collection, computation, presentation and
interpretation of relevant details or data.
Research design:
Research design is a purposeful scheme of action proposed to be carried out in a
sequence during the process of problem to be tackled. It is only a guideline for a researcher to
enable him to keep track of his actions and to know whether he was moving in the right
direction in order to achieve his goal.
Title of the study:

A study on the LOANS AND ADVANCES with respect to STATE BANK OF MYSORE ,
Ammasandra.
Place of the study:

STATE BANK OF MYSORE
Birla circle
Ammasandra-572 211
Tumkur (District)
Karnataka.
Statement of the problem:

This report is specially focused on the types of loans and advances offered by the
State Bank of Mysore along with the company profile. And to find out the awareness among
the people about loans and advances.
Objectives of the study:

1. The study on loans and advances available from SBM.
2. To make the public know about the different types of loans and advances available and to
make use of them.
3. To understand the procedures to be followed for availing the loans.
4. To help the borrowers in comparing the interest rates and processing charges from one
bank to another bank.
5. To enlist the utility of granting the loans and advances.
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6. To point out the nature of security provided for loans.

7. To find the effectiveness of loans and advances.
8. To know the parameters or factors influencing the borrowers.
9. To find out the satisfaction level of the customers or borrowers on the loans and
advances.
Scope of the study:

This study helps to express clear opinion about loans and advances granted by the
banks are highly beneficial to individuals, firms, companies and industrial concerns. Loans
and advances granted by the banks help in meeting short term and long term financial needs
of business enterprises. So it is necessary to study the loans and advances on whole. This
survey is limited to Ammasandra branch only.
Duration of the study:

February and March 2011.
Methodology:
Primary data:
The major portion of the data in the report is collected from the bank manager, bank
employees, bank customers and from the branch website.
Secondary data:
Books
Articles
Internet
News papers
Annual report
Limitations of the study:

1. Some of the confidential data's are not revealed by the bank personnel.
2. The study has to be completed within a short period of time due to which detailed study
was not possible.
3. The study is also based on the data supplied by the bank personnel.
4. Since the study was done in only Ammasandra branch, so the data collected may not be
considered 100%.
Sl. No.
CHAPTER
SUMMARY
Page 7
Chapter-1
Introduction
Deals with introduction of the study
Chapter-2
Research design of the study
Shows research methodology of the study
Chapter-3
Company Profile
Gives brief knowledge about the company
Chapter-4
Theoretical background of the study
Explains the theory with related to study
Chapter-5
Data Analysis and Interpretation
Shows the analysis and interpretation of
Chapter-6
Findings, suggestions and conclusion
data using graphs

Concludes the study with healthy
suggestions
Bibliography
Chapter Scheme:
CHAPTER-3
COMPANY PROFILE
STATE BANK OF MYSORE
HISTORY OF THE BANK
The Bank was incorporated on May 13, 1913 as a public limited company pursuant to
the Mysore Companies Regulation No.III of 1895 as The Bank of Mysore Limited. In
1953, the Bank of Mysore Limited was appointed as an agent of the Reserve Bank of India to
undertake government business and treasury operations. Under the patronage of the erstwhile
Govt. of Mysore, at the instance of the banking committee headed by the great EngineerStatesman, Late Dr. Sir M. Visvesvaraya . Subsequently, in March 1960, the Bank became
an associate of State Bank of India. State Bank of India holds 92.33% of shares. The Banks
shares are listed in Bangalore, Chennai and Mumbai stock exchanges.
Branch Network
The bank has a widespread network of 690 branches (as on 30.06.2010) and 21
extension counters spread all over India which includes 5 specialised SSI branches, 4
industrial finance branches, 3 corporate accounts branches, 4 specialised personal banking
Page 8
branches, 10 agricultural development branches, 3 treasury branches, 1 asset recovery branch

and 8 service branches, offering wide range of services to the customers.
Human Resources
The bank has a dedicated workforce of 10028 employees consisting of 3128
supervisory staff, 6900 non-supervisory staff (as on 30.06.2010). The State Bank of Indias
Chairman is also the Chairman of its associate State Bank of Mysore. There is a Chief
General Manager as well as 6 General Managers who assist the Managing Director of the
Bank. The skill and competence of the employees have been kept updated to meet the
requirement of our customers keeping in view the changes in the environment.
Financial Profile
The paid up capital of the Bank is 360 Millions as on 30.06.2010 out of which State
Bank of India holds 92.33%. The net worth of the Bank as on 30.06.2010 is Rs. 2073.40
Crores and the bank has achieved a capital adequacy ratio of 12.42% as at the end of
31.03.2010. The Bank has an enviable track record of earning profits continuously and
uninterrupted payment of dividend since its inception in 1913. The bank earned a net profit
of Rs. 445.77 Crores for the year ended March 2010 and earnings per share is at Rs. 124/-
Business Profile
Following table will showcase the business profile of State Bank of Mysore as on
March 2010 (Figures are in Rs. crores):
Total Deposits
Total Advances
Export Credit
Forex Merchant
39488.95
30603.18
1158.13
30678.46
Turnover
Forex Trading Turnover
125156.64
Forex Services
State Bank of Mysore offers the following forex services to the NRIs:
Page 9
NRI Deposits
Money Transfer to India through Western Union
Remittance facility through State Bank of India, New York Branch
Remittance to India-Global Link Service (GLS)
Organizational Setup
While the Chairman of State Bank of India is also the Chairman of the Bank, The
Managing Director of assisted by a Chief General Manager and 6 General Managers.
Management Committee of the Bank

Managing Director
Chief General Manager
Mr. Dilip Mavinkurve

Mr. Sudhir Dubey
General Manager
Mr. Sushil K Bhasin
(Operations)
General Manager
Mr. Abhay Nath
(Planning & Development)

General Manager
Mr. S. Vijay Kumar
(Commercial & Institutional

Banking)
General Manager
Mr. M.K. Nanjunda
(Treasury)
General Manager
Mr. A.K. Basu
(Technology)
General Manager
Mr. T. Thomas Mathew
(Vigilance & Inspection)
Page 10
Board of Directors
Shri O P Bhatt
Chairman Under Section 25(1)(a)
of State Bank of India (Subsidiary Banks) Act 1959
Shri Dilip Mavinkurve

Managing Director
Under Section 25(1)(aa) of the Act ibid
Page 11
Smt. Ratna K Makhija
Shri S A Thimmiah
Nominated by Reserve Bank of
India Under Section 25(1)(b) of

the Act ibid
India Under Section 25(1)(c) of

the Act ibid
Shri Gururaja Rao

Nominated by Government of
India Under Section 25(1)(cb)
of the Act ibid
Shri K Anand
Nominated by State Bank of
India Under Section 25(1)(c) of
the Act ibid
Shri B S Gopalakrishna
India Under Section 25(1) (c)
of the Act ibid
Shri Milind S Katti

Appointed by Government of
India Under Section 25(1)(ca)
of the Act ibid
Shri D D Maheshwari
Nominated by Governement of
India Under Section 25(1)(e) of
the Act ibid
Smt. May Rose Steele

Elected Under Section 25(1)(d)
of the Act ibid
Page 12
Key Milestones of the Bank

Year
Milestone
1913
1953
Incorporation of the Bank

The Bank of Mysore Limited was appointed as an agent of the Reserve Bank of India
to undertake government business and treasury operations
1959
The Bank of Mysore Limited was constituted as a subsidiary of State Bank of India,
pursuant to the notification of the State Bank of India (Subsidiary Banks) Act, 1959.
1961
Shares of the Bank were listed on the MSE
1963
Shares of the Bank were listed on the BSE

- Became the Lead Bank in three districts Mysore, Mandya and Tumkur. Currently
lead bank in Mysore, Chamrajnagar and Tumkur districts
1996
Issuance of 24,00,000 Equity Shares of the Bank having a face value of Rs. 100 each
for
cash at a premium of Rs.250/- per share
1998
Shares of the Bank were listed on the BSE
2003
100% computerization of the branches.
2005
Core Banking Solutions implemented in all branches of the bank.
2008
The aggregate of the advances and deposits of the Bank crossed Rs.50,000 crores
2009
Shares of the Bank were listed on the NSE
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Corporate Structure
EXECUTIVE BOARD
CM, MD SECT.
MANAGING DIRECTOR
DGM, COMPLIANCE
CHIEF GENERAL
CGM
MANAGER
General Manager [O]
ZONE No. of
Regions
BANGALORE I - 4
BA NGALORE II - 4
CENTRAL - 3
MYSORE - 5
HUBLI - 4
DELHI REGIONAL
OFFICE
MUMBAI Reg.
OFFICE
BA NGALORE BRA
NCH
DGM [ HR ]
DGM [ LAW ]
CM (BOD)
DGM [BPR]
AGM, G SEVA
General Manager [Try.]
DGM [ F & A ]
CM [SHARES &
BONDS]
DGM [FOREIGN
DEPT.]
AGM
[ PREMISES ]
AGM
[ SECURITY ]
DGM,Intgd.
TREASURY,
MUMBAI
General Manager
General Manager
[P&D]
C&I)
General
Manager[Tech]
&
Chief Risk Officer
DGM
[ CREDIT)
CAB
Mumbai
New Delhi
Bangalore
DGM [ AM &
R]
DGM [IT
SERVICES]
AGM [ISS CELL]
AGM [POLICY &
PLG.CELL]
DGM
[INTGD.RISK
MGMT]
CM [S&P]
DGM [ D&RB ]
AGM
[ PLANNING ]
CM [ O P D ]
AGM
[ MARKETING ]
CM [ PUBLIC
REL. ]
AGM [ HOCC ]
CM [ C & I ]
CM [Liaison]
General Manager
[V&I] & CVO
DGMINSPECTION
DGM [ INSPN.
MOBILE ]
DGM (CREDIT
AUDIT)
Page 14
TECHNOLOGY INCENTIVES
The Bank made significant investment in order to upgrade technology and the major
developments are as under:
CORE BANKING SOLUTION

State Bank of Mysore is the first Karnataka-based Bank with fully networked
branches. The Bank is fully on "CORE BANKING SOLUTION" from 31.12.2005. In record
time of one calendar year, the Bank completed the exercise of converting all the branches to
Core Banking to provide the convenience of anytime, anywhere banking to all our valued
customers.
State Bank of Mysore embarked upon the latest Banking Technology platform by
implementing the Core Banking Solutions (CBS) across all its branches, with an objective of
providing banking convenience to the customers. Following are some of the features of CBS.
> Facilitates 24 X 7 Banking
> Anywhere Banking
> Integration with strategic sectors
> Business Process Re-engineering (BPR) enabler
INTERNET BANKING (INB)

Transaction based Internet Banking facility that enables customers to view and
operate their accounts through the internet, 24x7 hrs and 365 days, is now available to both
retail and corporate customers.
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>>Transaction based Internet Banking in SBM has been in operation since JULY 2005
>> Customers of any branch of State Bank of Mysore can avail this facility
>>It is a 24 X 7, 365 days service channel for use anywhere, anytime
>> The Channel has real time transaction processing capability and is supporting various
business initiatives suitable to all segments of customers
>> Provides for select banking operations through the Internet and enables customers to
obtain information
REAL TIME GROSS SETTLEMENT (RTGS)

Consequent to introduction of Core Banking Solution all the branches have been
enabled to effect RTGS transactions. This facility enables seamless transfer of funds between
accounts of customers of different banks / branches that have been RTGS enabled. Transfer
of funds between banks is also to be done through RTGS.
INTERNAL RISK FACTORS

1. The Bank is exposed to high concentrations of loans to a few borrowers and default by
any one of them would adversely affect the Banks business.
2. Regulations in India require the Bank to extend a minimum level of loans to certain
specified sectors in India which may subject the Bank to higher delinquency rates.
3. The Bank is exposed to higher credit risk as Loans and advance to MSMEs as on
September 30, 2010 amount to 10.63% of the Banks loan portfolio.
4. The Banks funding is primarily through short-term and medium-term deposits, whereas
significant portion of Banks loan assets are Cash credits and Overdrafts renewed
periodically. If depositors do not roll over deposited funds on maturity or if the Bank is
unable to continue to increase its deposits, the Banks liquidity could be adversely affected.
5. The mismatch between Assets and Liabilities could affect the net profit.
EXTERNAL RISK FACTORS
Page 16
1. Changes to the prudential norms by the RBI requiring banks to maintain higher
provisioning norms would adversely affect the profitability.
2. Financial instability in other countries, particularly emerging market countries, could
disrupt the Banks business and affect the price of the Banks Equity Shares.
3. Hostilities, terrorist attacks, civil unrest and other acts of violence could adversely affect
the financial markets and the Banks business.
4. Natural calamities could have a negative impact on the Indian economy and harm the
Banks Business.
5. Political instability and significant changes in the Governments policy on liberalisation of
the Indian economy could impact the Banks financial results and prospects.
CHAPTER- 4
THEORETICAL BACKGROUND OF THE STUDY
I PERSONAL LOANS
1. Mortgage Loan
2. Housing Loan
3. Happy Home- Consumer Durable Loan Scheme
4. Gnanamitra Educational Loan
5. Personal Loans
6. Loan for purchase of residential site / plot
7. My Bank Arakshak
8. My Bank Adhyapak
9. My Bank Utsav
10. Comprehensive Car loan for new vehicles
11. Sanjeevini - New product scheme for high cost treatment
12. My Bank Samachar
13. Gagan Mitra
14. My Bank Udyogi Gnanamitra
Page 17
II AGRICULTURAL LOANS
1. Kisan Gold Card Scheme
2. Kisan Credit Card Scheme
3. Gramin Bhandaran Yojana (GBY)
4. Scheme for Combined Harvesters
5. Kisan Chakra Scheme
6. Agriclinics and Agri business centers. (ABC 10 dated 30.08.01)
7. Solar Photo Voltaic Pumpsets(SPV) for Irrigations
8. Scheme for purchase of land for agricultural purposes
9. Scheme for development of Vanilla
10. Establishment of Bio-Fertiliser Units (Model Scheme)
11. Produce Marketing Loan (PML)
12. Drip Irrigation
13. Sprinkler Irrigation
14. Farm Mechanisation- SBM Agri Farm Scheme
15. Swarna Mitra Scheme
16. My Krishigen
17. Scheme for cultivation of Gherkins
18. Scheme for financing LPG connection in rural areas
19. Scheme for financing to tenant farmers & Oral lessees
20. Rain water harvesting scheme for SC/ST farmers
21. Scheme for financing of Jatropha plantation
22. Scheme for financing to cultivation of patchouli
23. General Credit Card
III MICRO AND SMALL ENTERPRISES LOANS (MSE)

1. Credit Guarantee Fund Trust Scheme for Micro, Small & Medium Enterprises (MSEs)
2. Loans to Micro and Small Enterprises (MSEs)
Page 18
3. Retail Trade- Advances to Retail Traders (Other than Fertilizers & Mineral Oils)
4. MSEs- Service Sector (Small Business Enterprises)
5. Professionals & Self-Employed persons
6. Transport Operators
7. Laghu Udyami Credit Card Scheme
8. Stree Shakthi package for Women entrepreneurs
9. MyBank Sanchari Suvidha- Finance to Hotels, Restaurants and Lodges
10. Annapurna- Scheme for financing Women for establishing Food Catering Units
11. Mybank Doctor - New product to assist Doctors & Medical professionals for setting up
Clinic/Nursing Home
12. Flexi (SSI) Term Loan
13. SME Credit Plus
14. Green Auto
15. Swarojgar Credit Card scheme
16. Mybank Professional Plus
17. Artisans Credit card (ACC)
18. Stand-by-line of Credit (Term Loan) for SSI and C&I Borrowers
19. Reimbursement Facility under Term Loans: (SIB and C&I Segment borrowers)
20. "Sooryadeepa": Scheme for Financing Solar Home-lighting system
21. Rice Mill Plus
22. Contractor Plus
23. Channel financing to ACC Cement Dealers
24. State wise roadmap for increase of credit to minority over the next two years
25. Priority Sector Lending (PSL) target for Minority Communities as on September 2008 :
State-wise report.
IV COMMERCIAL AND INSTITUTIONAL LOANS

1. Scheme for Trades - Liberalised Trade Finance
2. Handy Loans Scheme
3. Corporate Loan
Page 19
4. Current Account Plus

5. Rent Plus
6. SBM Paryatan Plus
7. SBM School Plus
BRIEF INFORMATION ABOUT SOME POPULAR LOANS

AND ADVANCES
I PERSONAL LOANS
1. GNANAMITRA EDUCATION LOAN
Purpose
To enable students with academic brilliance to meet tuition and other fees /
maintenance costs / books and equipment and cost of passage for studies abroad etc., for
pursuing studies at recognised school / college / institution.
Courses Eligible- Higher Studies
Diploma / Graduate / Post-graduate courses in the faculties of Engineering,
Technology, Architecture, Medicine, Dental Science, Agricultural Science, Veterinary
Science and Computer Certificate courses of reputed institutes accredited to department of
electronics or affiliated to university.
Limit
Amount of loan
( (in Indian Rupees)
Higher Education- In
India
Higher Education-
MIN(Rs.)
10000
MAX(Rs.)
10.00 lacs
10000
20.00 lacs
Abroad
Page 20
Margin
Upto Rs. 4.00 lacs
Above Rs. 4.00 lacs
For studies in India
For studies abroad
Nil
5%
15%
Rate of interest
Fixed rate-
Upto 4.00 Lacs 12.50%

Above 4.00 Lacs 13.25%
Floating rate- Upto 4.00 Lacs 11.25%
4.00 to 7.50 Lacs 12.75%
Above 7.50 Lacs 11.75%
Second Educational Loan
To enable the students for taking higher education, provided the student secures 60%
marks in existing course. The second loan is to be availed only from the branch where the
first educational loan has been sanctioned.
Repayment
Technical / Professional Higher studies in India / Abroad
Repayment of loan to commence immediately after disbursal, by the parent /
guardian, out of his / her income. Installments may be nominal (to cover interest portion,
atleast) during the period the student is undertaking the studies. The installments will be
stepped up one year after the completion of the course or after the student gets a job,
whichever is earlier, so that the loan gets repaid together with interest within a period of 60 to
84 months thereafter.
Insurance
An insurance policy will be taken on the life of the student borrower for an amount
equivalent to the loan amount and the policy should be convertible whole-life one for 25 / 30
years, convertible after 5 years into one with endowment benefits. The Bank will pay the
insurance premia on the policy by debiting it to the loan account. On liquidation of the loan,
the policy will be reassigned and delivered to the borrower.
Page 21
Security
Amount
Upto Rs. 4.00
Security
NIL
lacs
Above Rs. 4.00
Collateral in the form of a suitable 3rd party guarantee
lacs and upto Rs.

7.50 lacs
Above Rs. 7.50
Collateral security by way of immovable property or equal
lacs and upto Rs.
to the loan amount in the form of Government securities /
10.00 lacs
NSCs / Units of UTI.

Guarantee of parents / guardians (in the case of minors,
the parent / guardian will execute the documents on behalf
of the minor and also in his capacity as co-borrower) /
third party guarantee where sufficient collateral security is
not available.
Repayment
Completion of course + 1 year or 6 months after getting a job, whichever is
earlier.The interest to be debited monthly on simple basis during the repayment holiday /
moratorium period. Penal interest @2% will be charged for amount above Rs. 2 lacs for the
overdue amount and overdue period. Interest concession of 1% per annum is available,
provided the interest is repaid during moratorium period as and when the interest is
applied.
2. PERSONAL LOAN
Eligibility
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Individuals, employees of state / central government, Public Sector undertakings,

reputed profit making Public limited companies, Multinational companies with a minimum
service of two years and drawing a net salary of Rs. 6,000/- or above.
Purpose
To meet personal expenses like marriage, family functions, medical expenses, travel etc.
Loan Amount
Upto Rs. 1.50 lacs depending on repayment capacity of the individuals.
Security
Third party guarantee of equal means. Securities like LIC policies, NSC, KVIP, Shares etc.
Period of Repayment
12 months to 36 months.
Rate of interest
15%
Type of Loan
Demand loan.
Processing Fee
1% of loan amount (one time).
3. SBM EASY CAR LOAN

Eligibility
Page 23
Individuals of age 21 to 65 years and salaried class with annual income of Rs. 75000/& above. Self-employed & Professionals with annual income of Rs. 75000/- & above.
Loan amount:
30times of Net Monthly Income for salaried persons.
2.5 times of Net Annual Income for others.
Margin:
Amount
Loans upto
Margin
15%
Rs.6.00 lacs
Above Rs. 6.00
30%
lacs
Rate of interest
Fixed rate: During 1st year 8.25%
During 2nd & 3rd year 10.25%
Floating rate: For 4th & 5th year 3.75% above Base rate, present effective rate
being 11.50%
For 6th & 7th year 4.00% above Base rate, present effective rate being 11.75%
Security:
Hypothecation over the car .
Guarantee of spouse if employed.
3rd party guarantee good for the loan amount.
Insurance:
Comprehensive insurance for full value of the vehicle. FREE ACCIDENT INSURANCE
COVER (DEATH RISK ONLY)
Page 24
Disbursal:
Direct to the supplier.
Repayment:
Loan should be repaid within 7 years from the date of original purchase of the vehicle.
4. HOUSING LOAN
Under Personal Segment, You can avail a loan for
Construction or Purchase of a new house or flat

Repairs / Renovation / Extension of existing house
For purchase of plot for construction of house within two years
For purchase of built houses not more than 15 years old
Housing loan against II charge
For Purchase of Furnishings / Consumer durables as part of the project cost.
Attractive features of State Bank of Mysores Housing Finance scheme
Loans from State Bank of Mysore are cheaper than housing finance agencies /
companies.
Nominal processing charges.
No administration charges.
No commitment charges.
Interest charged on reducing balances.

Facility available at all branches in India.
Exemption from wealth tax for one house under Wealth Tax Act.
Quantum of Loan amount

Loan amount for all categories
Net Annual Income
Upto Rs. 60000/-
EMI / NMI Ratio

20%
Page 25
Above Rs. 60000 to less than Rs.1,20,000/-
25%
Above Rs. 1,20,000/- to less than Rs.2,00,000/-
30%
Above Rs. 2,00,000 to less than Rs.5,00,000/-
50%
Above Rs. 5,00,000 to less than Rs.10,00,000/-
55%
Above Rs. 5 lacs
55%
Maximum Repayment period

Age
Repayment period
For persons below 35 years of age

For persons below 45 years of age
For persons above 45 years of age
25 years
20 years
15 years
Margin
Amount
Margin (%)
Upto Rs. 30 lakhs

Above Rs. 30 laks to 75 lakhs
Above Rs 75 lakhs to 1.00 Crore
Above Rs 1.00 crore
20%
20%
25%
40%
Interest
Penal interest of 1% in case of default of three or more consecutive instalments.
Rate of Interest
NAME OF THE
PERIOD
SCHEME
HOUSING LOANS
Rate Of Interest
(Base Rate 7.75%p.a)
Upto 5 years
9.25%
Above 5 to 15 years
9.50%
(UPTO Rs.20.00 LACS)
Page 26
HOUSING LOANS
Above 15 to
9.75%
inclusive of 25 years
Upto 5 years
9.25%
Above 5 to 15 years
9.50%
Above 15 to
9.75%
Upto 5 years
9.75%
Above 5 to 15 years
10.00%
Above 15 to
10.25%
(Above Rs.20 lacs upto 30

Lacs)
HOUSING LOANS
(Above Rs.30 Lacs)
Processing charges
Loan Amount
Processing fee (Including Service
Up to Rs.5 lakhs
Above Rs.5 lakhs & upto Rs.10 lakhs
Above Rs. 10 lakhs & upto Rs.20 lakhs
Above Rs.20 lakhs & upto Rs.50 lakhs
Above Rs.50 lakhs & upto Rs. 1 Cr
Above Rs. 1 Crore & upto Rs. 5 Cr
Above Rs. 5 Crores
tax) Rs.
1000/2000/5000/7000/8000/10000/20000/-
Insurance
Page 27
The house property has to be insured covering all risks. Group insurance is available
to cover the life of the borrower on payment of one time upfront premium.
Disbursement
Direct to the sellers in case of purchase.
For Construction / Repairs / Renovations in a phased manner.
Repayment
Repayable in monthly installments. Repayment period ranging from 5 to 25 years,
including a moratorium period ranging from 6 to18 months from the date of the first
disbursement.
5. MYBANK ADHYAPAK
Personal loan scheme for teacher community.
Eligibility
Permanent Teachers / Non-Teaching Staff of Central / State Govt. Educational
Institutions and also Teachers and Non-Teaching Staff of Govt. Recognised Schools /
Colleges / Aided Institutions.
Purpose
Personal Loan for any purpose including purchase of consumer durables.
Page 28
Loan amount
10 times net monthly income with a maximum of Rs. 1.00 lac.
Income of Spouse
Spouse income may be added to arrive at the eligible loan amount provided spouse is also
employed and stands as guarantor.
Type of account
Demand loan account.
Margin
Nil.
Repayment
Maximum of 36 months in equated monthly installments.
Rate of interest
13.75%.
Processing Fee
Rs. 250/- flat.
Security
Upto Rs. 25000/- Nil (only check off facility)
Above Rs. 25000/- check off facility. NSC, LIC policy may be insisted for security wherever
possible or third party guarantee of equal means.
II AGRICULTURAL LOANS
Page 29
1. Drip Irrigation
It is a method of irrigation in which the required quantity of water is supplied at low
pressure to the root Zone of each plant drop by drop by drippers / emitters through a network
of pipes so that the plants would not experience any stress through growing phase.
Why Drip Irrigation?
Drip irrigation is a boon to the farmers in arid and semi arid areas where water is
scarce. Main advantages of drip are
water saving 50-70%

saving of labour and energy 60-90%
use of low quality water
Increase in yield 15-50%
saving of nutrients 30-60%
use in hilly terrain / problem soils
Crops
The system can be used for all plants. However it is ideal for wide spaced high value
Horticultural crops viz. coconut, plantation crops, fruit crops, medicinal plants, spices, flower
plants etc.
Components of drip system
Water supply pump, filters, fertilizer mixing tank, control system, main and sub main
lines, laterals, micro-tubes and drippers.
Unit Cost
As approved by NABARD for various crops.
Subsidy
Capital subsidy on Drip irrigation equipments enhanced to 50% for all farmers and
100 % for SC/STs and Horticulture crops in Bijapur Districts.
Rate of interest
13.75% (1.00% above SBMPLR)
Repayment
10-15 years with a grace period of 11 months in case of yielding plantations
In case of new plantations grace period up to the period of maturity / yielding
For crops like sugarcane 7 years coinciding with harvesting / marketing.
Page 30
2. SCHEME FOR PURCHASE OF LAND FOR AGRICULTURAL

PURPOSE
Purpose
Purchase of agrl. land as well as fallow and waste land to SF / MF / landless agri labourers.
Eligibility
SF and MF and landless agri labourers. Total land holding should not exceed the
prescribed ceiling of land holdings including the purchased one as advised by NABARD.
Quantum of loan
Should not exceed Rs.2 lacs by way of ATL and investment on land development and
provision of irrigation should not exceed 50% of the cost of land.
Margin
20% or prescribed by RBI from time to time.
Interest
13.75% (As applicable to ATLs)
Repayment
7-10 years in half yearly / yearly instalments including a moratorium of 24 months.
3. KISAN CREDIT CARD SCHEME

Purpose
To meet the timely Cash Credit and Consumption credit requirements of the farmers.
Eligibility
All farmers.
Quantum of loan
o Entire crop production requirements for full year is fixed based on operational land
holding, cropping pattern and scale of finance.
o Ancilliary to crop production viz. maintenance of Agri-machiney implements, electricity
charges also may be considered.
o Contingency requirement to an extent of 20% of the peak credit limit for expenses like
Medical, Education, Marriage, Funerals, Birth and other religious ceremonies.
Page 31
Drawing power
Appropriate drawing may be fixed based on seasonality in credit requirements,
projected cash flow / repayment , peak level requirement
Rate of interest
13.25% (0.50% above SBMPLR)
Repayment
KCC is like revolving cash credit limit valid for 3 years subject to annual review.
Repayment to coincide with harvesting / marketing. Any number of withdrawals and
repayment within the limit allowed.
Credit card
A credit card cum pass book issued to the farmer borrower.
Mode of withdrawal
Withdrawal slips.
Other terms
As applicable to Agricultural Advances.
4. FARM MECHANISATION- SBM AGRI FARM SCHEME

Mechanisation of farming has been considered as one of the important inputs in
farming, to complete the farm operations on time and to increase production and reduce the
drudgery of human labour. With the rapid advancement in agriculture, there has been an
increased use of farm machanisation equipments like Tractors and Power Tillers which help
us tiding over the labour problem for Agriculture.
We have been assisting the farmers for purchase of Tractors / Power tillers etc.
However, with a view to enhance our lending under Farm Mechanisation, our Bank has
entered into an MOU with the following Tractor manufacturing Companies
a) M/S Escorts
b) M/S HMT Limited
c) M/S TAFE
d) M/S Swaraj
e) M/S New Holland Tractor (Ford)
f) M/S SAME Tractors
Page 32
g) M/S International Tractors Limited (Sonalika)

h) M/S Eicher Tractors
i) M/S L&T John Deere private Limited
j) M/S Bajaj tempo Limited
k) M/S Mahindra Gujarat Tractor
l) M/S Mahindra and Mahindra Limited
m)M/S Standard Combines (P) Ltd
n) M/S Indo Farm Tractors
o) M/S SAS Motors ltd., (Angad Tractors)
p) M/S Preet Tractors (p) Ltd
POWER TILLER COMPANIES
a) M/S Greaves Cotton Limited
b) M/S Bengal Tools Limited
Norms for financing of Tractors
Acreage
The borrower should possess a minimum of 4 acres of wet land or 6 acres of dry land
to ensure viability of the medium term loan to be extended for the purpose. Tractor finance to
farmers who are having lesser land holdings than stipulated can also be considered on a case
to case basis provided the applicant is having sufficient income from other sources to service
the debt.
Economic use of Tractor
The tractor should have a minimum of 1000 hrs production work in agri. per year
either on own farm or on custom hire or both.
Minimum 3 implements should be owned by the beneficiary (either with bank finance
or purchased with own funds)
The Tractor financed should have the necessary commercial test report as per BIS
code issued by CFMTTI (Central Farm Machinery Training and Testing Institute), Budni,
Madhya Pradesh.
Margin Money
Down payment in respect of farm mechanization loan for new tractors will be not less
than 10% of the investment cost in case of tractors and implements.
Rate of interest
11.50% pa irrespective of the limit.
Page 33
Repayment Period
Maximum 9 years.
Registration of the tractor
The tractor should be registered with the concerned Regional Transport Authority.
Insurance
Comprehensive Insurance cover should be obtained in respect of the assets acquired.
Premium for first year will be paid by the concerned Company dealers.
Selection of Tractors
Bank may consider financing of tractors on the basis of viability of individual
proposals but the choice and selection of such tractors may be left to the choice of individual
beneficiaries.
Security
As per Banks norms.
(a) Hypothecation of Tractors.
(b) Equitable Mortgage of lands.
5. SWARNA MITRA SCHEME

The salient features of the scheme are presented below:
Purpose to provide easy loans to meet their immediate agricultural requirement.
Loans against pledge of Gold Ornaments.
Rate of interest as applicable to agricultural cash Credits.
Repayment coinciding with the harvesting season.
Advance amount Rs. 650/- per gram, subject to a maximum of Rs 5 lacs per borrower.
III MICRO AND SMALL ENTERPRISES LOANS (MSE)

1. RETAIL TRADE- ADVANCES TO RETAIL TRADERS (OTHER
THAN FERTILIZERS & MINERAL OILS)
Eligibility
All types of Retail Traders are eligible. Persons who propose to start retail trade
business, fair price shop, consumer co-operative stores are also eligible for finance.
Page 34
Extent of Finance
Credit limits up to Rs.20 lacs.
Rate of Interest
As per prevailing rates from time to time.
Margin
No margin upto Rs. 25000/- 15 to 20%, for credit limits exceeding Rs. 25000/Security
Assets created out of Banks finance collateral security as per Banks norm.
2. LOANS TO MICRO & SMALL ENTERPRISES (MSEs)

Eligibility
Any individual / partnership firm / Public or Private Ltd. Companies desirous of
promoting MSEs (Manufacturing sector) with investment in Plant & Machinery not
exceeding Rs. 5 crore and Medium Enterprises with investment in plant & Machinery is
above Rs. 5 Crore and upto Rs. 10 crores.
Extent of Finance
Need based (both fund based and non-fund based).
Margin
Working capital/ medium term loan.
a) No margin upto Rs. 25000/b) Credit limit over Rs. 25000/Flexible approach:
15% - 25% depending on the merits of each case.
Security
Primary:
Assets created out of Bank finance.
Collateral:
Obtention of collateral Security exempted.
Up to Rs. 5 lacs.
Over Rs. 5 lacs and up to Rs. 25 lacs, based on good track record and satisfactory
financial position.
Page 35
Over Rs.25 lacs at the discretion of the Bank.
Interest
Export Finance
Establishment of Letter of Credit.
Pre-shipment finance.
Post-shipment finance.
Assistance against Duty draw back.
3. TRANSPORT OPERATORS
Eligibility
Advances to Small Road and Water Transport operators.
Extent of Finance
Not exceeding Rs 200 lakhs.
Rate of Interest
Margins
No margin upto Rs. 25000/15 to 25% for credit limit exceeding Rs. 25000/Security
Assets created out of Banks finance.
Collateral security as per Banks norm.
4. STREE SHAKTI PACKAGE FOR WOMEN ENTERPRENEURS

Women entrepreneurs comprise those small scale units managed by one or more
women entrepreneurs who have stake not less than 51% of the equity.
The important features of the package are:
The entrepreneurs who have undergone EDP conducted by State level Agencies or
programmes co-sponsored/sponsored by Bank are eligible for financial assistance.
Page 36
Branch Manager and the field Staff will provide necessary inputs and assistance to
those women who do not plan to set up ful-fledged industrial ventures but would like to do
something at home.
Concession in Margin :
Retail Traders
Category Limit Slab in Rs.
Over Rs. 5000/- upto Rs. 25000/-
Margin concession
NIL
Over Rs. 25000/- upto Rs. 1.00 lac
5%
Business Enterprises
Upto Rs. 25000/Over Rs. 25000/- upto Rs. 1.00 lac
Margin concession
NIL
5%
Professionals & Self-employed women

Upto Rs. 25000/Over Rs. 25000/-
Margin concession
NIL
5%
SSI
Upto Rs. 25000/Above Rs. 25000/-
Margin concession
NIL
5%
Interest concessions
No interest concession in respect of SSI units enjoying credit limits over Rs.25000/- but
up to Rs.2 lacs.
Above Rs.2 lacs and up to Rs.50 lacs, interest rate lower by 0.50% than the applicable
rate.
For Small Business enterprises under the scheme, interest rate lower by 0.50% than the
applicable rate.
For advances to professionals and self employed persons interest rate lower by 0.50%
than the applicable rate.
No interest concession to advances granted to private retail traders.
Page 37
5. ANNAPURNA- SCHEME FOR FINANCING WOMEN FOR

ESTABLISHING FOOD CATERING UNITS
Eligibility
Women (both individual and Partnership firms).
Purpose
For establishing food Catering Unit for selling tiffin/food/lunch packs etc.
Extent of Finance
Maximum loan of Rs.50000/Type of loan
Composite Term Loan (Working Capital portion will be within 50% of CTL).
Purpose of loan
Term Loan component can be used for purchase of utensils and cutlery, gas
connection, Refrigerator, Mixer cum Grinder, Hot case, Utensil stand, Tiffin boxes, Working
table, Water filter etc.
Repayment
Upto 36 monthly installments including one month moratorium period.
Margin : 10%.
Rate of Interest: As per prevailing rates.
.
Security
Hypothecation of assets created out of Bank Loan.
Guarantee
One guarantor (with sufficient means) acceptable to the Bank.
IV COMMERCIAL AND INSTITUTIONAL LOANS

1. HANDY LOANS SCHEME- FOR TRADE & SERVICES SECTOR
Coverage: Metropolitan, Urban & Semi-Urban Branches.
Salient features of the scheme:
Type of loan
Page 38
Term Loan.
Amount
Minimum of Rs.2 Lacs and maximum of Rs.25 Lacs.
Handy Loan can be availed for :
o Holding stocks / Receivables.
o Acquisition of land and buildings for establishing trading house.
o Building construction & renovation of offices, showrooms, godowns etc.
o Purchase of equipment, furniture & vehicles.
o Augmenting networking capital.
o Payment of long term deposits / advances to supplier.
o General trade purposes.
Eligibility
Applicants should be engaged in trade, services activities, and have rating of SBM 1 to 4
under Credit Risk Assessment System.

Earned pre-tax profits in the immediately preceding 3 years.
Sales tax registration & relevant business license.
Repayment
Repayable between 3 to 5 years.
Quantum of loan
Upto 75% of the project cost.
Interest
SBM Prime Lending Rate plus spread as per Credit Risk Assessment System.
Security
Hypothecation of current assets/Equitable Mortgage of Immovable property.
Insurance
Comprehensive insurance of all securities.
Audited Financial Statements must for limits above Rs.25 lacs.
2. SCHEME FOR TRADERS- LIBERALISED TRADE FINANCE

State Bank of Mysore has designed schemes for traders to meet their working capital needs
under C&I and SME Segment.
The following categories of borrowers will be covered:
a. Small business enterprises.
Page 39
b. Retail traders/ wholesale traders.

c. Professional and Self employed.
A maximum amount of Rs.500.00 lacs is extended by way of cash credit/ term loan
facility, with margin 35%.
Rate of interest
Cash credit 13.00% i.e. 4.75% above base rate.
Term loan 13.50% i.e. 5.25% above base rate.
Limit is available for a period of 12 months renewable annually for cash credit and for term
loan 60 months.
The hypothecated stocks and other securities offered are to be insured comprehensively.
Stock statements/ book debt statements to be furnished quarterly in case of loan for
inventories or current assets.
Immovable property of 153% of the loan amount to be mortgaged to the bank.
No third party guarantee.
Salient features of the scheme:(revised scheme wef 10.04.07)
A maximum amount of Rs.50 Lacs is extended by way of Cash Credit facility, with
margin ranging between 25 % and 35%.
65% of realisable value of property mortgaged. Valuation report not more than three
months old. Types of properties that can be mortgaged are restricted.

For limits Rs.25 Lacs & above audited financial statements are to be submitted.
Annual interest liability should not exceed 50% of gross profit.
Limit is available for a period of 12 months, renewable annually.
The hypothecated stocks and other securities offered are to be insured comprehensively.
Stock statements / book-debts statements to be furnished annually as on 31st March every
year.
Personal guarantee of the promoters / partners / directors of the company.
Immovable property to be mortgaged to the bank. Third party guarantee is also accepted.
3. SBM SCHOOL PLUS

A new scheme for Construction / Renovation / Repairing of School/College
Buildings; Purchase of electronic equipments such as Computers, Laboratory Equipments,
Library Books etc.
Nature of facility
Demand Loan / Term Loan.
Page 40
Eligible Customers
Educational Institutions with adequate source of income.
Purpose
Construction / Renovation / repairing of school/College buildings; Purchase of Electronic
equipments such as computers; Laboratory Equipments, Library books etc.
Quantum of Finance
Minimum Rs.50000/Maximum Rs. 25.00 lacs
Margin
15% of the cost.
Period of repayment
Maximum period of 7 years.
Rate of interest
Amount
Rate of Interest(%)
Upto Rs. 2.00 lacs

Above Rs. 2.00 lacs &
upto Rs. 25.00 lacs
a) Repayable in less than 3
years
b) Repayable in 3 years &
above
12.25%(1% below SBMPLR, i.e. 13.25-1.00

=12.25%)
At SBMPLR i.e. 13.25%
13.75%(0.5% above SBMPLR i.e.
13.25+0.50=13.75%)
Primary Security
Equitable mortgage of the immovable property / hypothecation of assets acquired out of the
Bank loan.
Collateral Security
Personal guarantee of key persons / Trustees / Promoters. Equitable mortgage of immovable
property.
Insurance
Adequate Insurance cover to be obtained.
4. SBM PARYATAN PLUS

Page 41
A new scheme targeted at the Tourism Industry for Construction / Modernization of

hotels, restaurants, health clubs, amusement parks etc., Purchase of Luxury buses, Coaches,
Cars etc., at tourist centres.
Nature of facility
Cash Credit, Term Loan, Letter of Credit, Bank Guarantee.
Purpose
Construction / Modernization of hotels, restaurants, health clubs, amusement parks
etc., Purchase of Luxury buses, Coaches, Cars etc., at tourist centres.
Quantum of Finance
Minimum Rs.2.00 lacs.
Margin
20% of the project cost.
40% in case of second hand vehicles/equipments.
Period of repayment
Between 3 to 7 years in case of Term Loans.
Rate of interest
SBMPLR + spread as per Credit Risk Assessment System. Between 14.00% to 15.50%.
Primary Security
Hypothecation of assets created out of Bank's Loan.
Collateral Security
Tangible collateral in the form of immovable property / NSCs etc.
Insurance: Insurance cover for 100% of the loan amount required.
Page 42
CHAPTER-5
DATA ANALYSIS AND INTERPRETATION
Table No.1
Table showing the respondents educational qualification.
Sl. No.
Educational Qualification
No. of respondents Percentage (%)
1.
Under Graduates
10
20
2.
Graduates
16
32
3.
Post Graduates
4.
Total
Others
20
50
40
100
Interpretation: The above table shows that, out of total respondents 40% of them lies under
Others category, 32% of them lies under Graduates category, 20% of them are Under
graduates and 8% of them are Post graduates.
Conclusion: It can be easily inferred that the majority of respondents comes under Other
educational group. Among all the respondents 40%(majority) of them falls under Others
category and 8%(minority) of them falls under Post Graduate category.
Page 43
Graph No. 1
Graph showing the respondents educational qualification.
Educational Qualification
45%
40%
35%
30%
25%
20%
40%
32%
15%
10%
20%
5%
8%
0%
Under Graduates
Graduates
Post Graduates
Others
Table No. 2
Table showing number of respondents on the basis of occupation.
Page 44
Sl. No.
Occupation
No. of respondents
Percentage (%)
1.
Salaried
21
42
2.
Retired
10
20
3.
Self-employed
11
22
4.
Others
16
50
100
Total
Interpretation: The above table clearly shows that out of 50 respondents 21 of them are
salaried persons, 10 of them are retired persons, 11 of them are self-employed persons and 8
of them belongs to others category.
Conclusion: It can be easily inferred that among 50 respondents 42% of the respondents are
salaried persons, 22% of them comes under self-employed category, 20% of them are retired
and 16% of them falls under others category.
Graph No.2
Graph showing number of respondents on the basis of occupation.
Page 45
Occupation
16%
Salaried
Retired
42%
Self-employed
Others
22%
20%
Table No. 3
Table showing the rate of interested borrowers.
Sl. No.
Interested
No. of respondents
Percentage (%)
1.
2.
Total
Yes
No
36
14
50
72
28
100
Page 46
Interpretation: Out of 50 respondents 36 of them are interested in borrowing loans and only
few that is 14 members are not interested in borrowing loans.
Conclusion: It is clear by seeing the graph that majority (72%) of the respondents like to
borrow loans and minority(28%) of respondents have considerably less interest in borrowing
loans due to various reasons.
Graph No. 3
Graph showing the rate of interested borrowers.
Page 47
Interested
80%
72%
70%
60%
50%
40%
28%
30%
20%
10%
0%
Yes
No
Table No. 4
Table showing the reasons for not borrowing the loans.
Sl. No.
Reasons
No. of respondents
Percentage (%)
1.
Not necessary
29
2.
Lack of information about

loans
Unsure about repayment
14
21
3.
Page 48
4.
Local lenders
Total
36
14
100
Interpretation: Out of 14 respondents not interested in borrowing loans 4 of them comes

under not necessary category, 2 of them under lack of information about loans category, 3 of
them under unsure about repayment category and 5 under local lenders category.
Conclusion: Most of the respondents gave reasons for not borrowing loan is due to local
lenders. So the Banks should consider this reason in order to increase the rate of interested
respondents in future.
Graph No. 4
Graph showing the reasons for not borrowing the loans.
Page 49
Reasons
40%
35%
30%
25%
20%
15%
10%
5%
0%
Table No. 5
Table showing the preferences of borrowers in borrowing loans and advances.
Sl. No.
Preference
1.
2.
Personal
Agricultural
No. of respondents Percentage (%)

14
17
28
34
Page 50
3.
4.
Micro & Small

Enterprises
Commercial &
institutional
Total
12
24
14
50
100
Interpretation: Out of 50 respondents 14 respondents comes under personal loans, 17

respondents comes under agricultural loans, 12 respondents comes under micro & small
enterprises loans and 7 respondents comes under commercial & institutional loans.
Conclusion: Most of the respondents prefer to obtain agricultural loans and only a few
respondents like to borrow commercial & institutional loans. Thats why our India is called
as an agriculture based country.
Graph No. 5
Graph showing the preferences of borrowers in borrowing loans and advances.
Page 51
Preference
Commercial & institutional
14%
Micro & Small Enterprises
24%
Preference
Agricultural
34%
Personal
0%
28%
5%
10%
15%
20%
25%
30%
35%
40%
Table No. 6
Table showing the factors that influenced the respondents to borrow the loans.
Sl. No.
Factors
No. of respondents
Percentage (%)
1.
Loan amount
16
32
2.
Purpose
12
Page 52
3.
Interest rate
20
40
4.
Repayment period
16
50
100
Total
Interpretation: Out of 50 respondents 16 belongs to loan amount, 6 belongs to purpose, 20

belongs to interest rate and 8 belongs to repayment period.
Conclusion: Majority of the respondents are influenced by the interest rate factor, secondly
by the factor of loan amount and least influenced by repayment factor.
Graph No. 6
Graph showing the factors that influenced the respondents to borrow the loans.
Page 53
Factors
Loan amount
16%
Purpose
Interest rate
32%
40%
12%
Repayment period
Table No. 7
Table showing repayment period preferences.
Page 54
Sl. No.
Repayment Period
No. of respondents
Percentage (%)
1.
Less than 1 year
10
2.
1-5 years
15
30
3.
5-10 years
20
40
4.
Above 10 years
10
20
50
100
Total
Interpretation: Out of 50 respondents 5 respondents comes under less than one year, 15
respondents comes under one to five year, 20 respondents comes under five to ten years and
10 respondents comes under above ten years.
Conclusion: From the graph we can say the majority of the respondents would like to repay
the loan from 5-10 years, because it is suitable for all levels of customers.
Graph No. 7
Graph showing repayment period preferences.
Page 55
Repayment Period
40%
40%
35%
30%
30%
25%
20%
Repayment Period
20%
15%
10%
10%
5%
0%
Less than 1 year
1-5 years
5-10 years
Above 10 years
Table No. 8
Table showing respondents choice from among the following agricultural loans.
Sl. No.
Agricultural Loans
No. of respondents
Percentage (%)
1.
Drip irrigation
17
34
2.
Scheme for purchase of

land for Agr. Purpose
18
Page 56
3.
Farm Mechanisation
12
24
4.
Swarna Mitra Scheme
14
5.
Kisan Credit Card

Scheme
10
50
100
Total
Interpretation: In the above table out of 50 respondents 17 respondents comes under

drip irrigation, 9 respondents comes under scheme for purchase of land for agricultural
purpose, 12 respondents comes under farm mechanization, 7 respondents comes under
Swarna mitra scheme and 5 respondents comes under Kisan credit card scheme.
Conclusion: Among the five popular agricultural loans majority of the respondents
would prefer in borrowing drip irrigation loan, secondly for farm mechanization loans
and minority in borrowing Kisan credit card loan.
Graph No. 8
Graph showing respondents choice from among the following agricultural loans.
Page 57
Agricultural Loans
35%
30%
25%
20%
15%
10%
5%
0%
34%
18%
24%
14%
10%
Table No. 9
Table showing respondents preference in borrowing the below listed personal loans.
Page 58
Sl. No.
Personal Loans
No. of respondents
Percentage (%)
1.
Car loan
18
2.
Gnanamitra
education loan
12
24
3.
Housing loan
10
20
4.
Personal loan
14
28
5.
My Bank Adyapak
10
50
100
Total
Interpretation: In the above analysis out of 50 respondents 9 respondents comes under car
loan, 12 respondents comes under gnanamitra loan, 10 respondents comes under housing
loan, 14 respondents comes under personal loan and 5 respondents comes under my bank
adyapak loan.
Conclusion: Most of the respondents would like to borrow personal loan from the other five
popular personal loans and secondly they give more preference in borrowing gnanamitra
education loan.
Graph No. 9
Graph showing respondents preference in borrowing the below listed personal loans.
Page 59
30%
25%
20%18%
28%
24%
20%
15%
10%
10%
5%
0%
Table No. 10
Table showing respondents choice in borrowing the following micro & small enterprises
loans.
Page 60
Sl. No.
Micro & Small

Enterprises Loans
No. of respondents
Percentage (%)
1.
Annapurna Scheme
16
2.
Stree Shakthi package
16
32
3.
Loans to MSEs
18
4.
Transport Operators
12
5.
Loans to Retail Traders
11
22
50
100
Total
Interpretation: By seeing the above table out of 50 respondents 32% of the respondents
prefer stree shakti loan, 22% of respondents in loans to retail traders, 18% of respondents in
loans to MSEs, 16% of respondents in Annapurna loan and 12% of respondents in transport
operators.
Conclusion: After having a look over the above graph we are able to say that most part of
the respondents are interested in borrowing stree shakti loan.
Graph No. 10
Graph showing respondents choice in borrowing the following micro & small
enterprises loans.
Page 61
Micro & Small Enterprises Loans
Annapurna Scheme
22%
16%
Loans to MSEs
12%
32%
Transport Operators
18%
Table No. 11
Table showing which loan does the respondents like to obtain from the below listed
commercial & institutional loans.
Sl. No.
Commercial &
Institutional Loans
No. of respondents
Percentage (%)
1.
SBM School Plus
10
20
Page 62
2.
Scheme for traders
13
26
3.
Handy loans
20
40
4.
SBM Paryatan Plus
14
50
100
Total
Interpretation: Among 50 respondents 20 respondents comes under handy loan, 10

respondents comes under SBM school plus, 13 respondents comes under scheme for traders
and 7 respondents comes under SBM paryatan plus.
Conclusion: 40% of the respondents are interested in handy loan scheme and other schemes
have considerable interests. So majority of respondents like handy loan.
Graph No. 11
Graph showing which loan does the respondents like to obtain from the below listed
commercial & institutional loans.
Page 63
Commercial & Institutional Loans
14%
20%
SBM School Plus
Handy loans
Scheme for traders
SBM Paryatan Plus

26%
40%
Table No. 12
Table showing the level of satisfaction towards loans and advances.
Sl. No.
Satisfaction
No. of respondents
Percentage (%)
1.
2.
3.
Highly satisfied
Satisfied
Considerably satisfied
6
32
10
12
64
20
Page 64
4.
Total
Not satisfied
2
50
4
100
Interpretation: Out of 50 respondents 6 respondents are highly satisfied, 32 respondents are

satisfied, 10 respondents are considerably satisfied and only 2 respondents are not satisfied
with the loans and advances.
Conclusion: From the graph we can say majority of the respondents are satisfied with the
loans and only a few respondents are not satisfied.
Graph No. 12
Graph showing the level of satisfaction towards loans and advances.
Page 65
Satisfaction
4%
12%
20%
Highly satisfied
Satisfied
Not satisfied
64%
Table No. 13
Table showing the expectations of the borrowers from loans.
Sl. No.
Expectations
No. of respondents
Percentage (%)
1.
2.
Low rate of interest

More amount
24
16
48
32
Page 66
3.
Long repayment period
10
4.
Subsidy
10
50
100
Total
Interpretation: Out of 50 respondents 48% of respondents comes under low rate of interest,
32% under more amount, 10% under long repayment period and 10% under subsidy.
Conclusion: From the analysis one can say that majority of the respondents expect low rate
of interest and also more amount from the loans.
Graph No. 13
Graph showing the expectations of the borrowers from loans.
Page 67
Expectations
10%
10%
More amount

48%
Subsidy
32%
CHAPTER-6
FINDINGS, SUGGESTIONS AND CONCLUSIONS
LEARNING EXPERIENCE:
Page 68
During this training period, I really learnt many aspects. I have learnt about the
loans and advances, their interest rates, types like term loan/demand loan, insurance coverage
and security etc.
FINDINGS
1. During the study it is found that out of 100% respondents still 28% of them are not
interested
in borrowing loans.
2. From the study it is known that the level of highly satisfied respondents is less when
compared to level of satisfied and considerably satisfied respondents.
3. Most of the respondents are expecting low rate of interest and also more loan amount from
the loans.
4. Compared to other types of loans and advances customers in more number are borrowing
agricultural loans in the Ammasandra branch and personal loans occupy the next position.
5. The study discloses that Stree Shakti package is more popular than any other micro &
small enterprises loans.
6. Many of the respondents gave reasons for not borrowing loans is due to the influence of
local money lenders.
7. It is found that most of the respondents preferred 5-10 years of repayment period.
8. From this study it has come to light that among all the agricultural loans drip irrigation
loan is more popular.
9. Among the total population of Ammasandra majority of them are employed and thus there
is more demand for personal loans in this branch.
10. It was clear from the study that large number of womans has been greatly empowered by
Stree Shakti package.
11. Bank Manager plays a key role in making public knowledgeable about availability of
different types of loans and advances for different purposes.
12. Most of the farmer respondents were expecting more subsidies on agricultural loans.
SUGGESTIONS
Page 69
1. Still there are a number of aspects to be considered in order to make loans and advances
more popular like rate of interest, insurance coverage, security, eligibility etc.,
2. Bank has to take several steps to make loans more reliable with public interest.
3. Timely awareness programmes related to loans are needed in order to literate the public
about the loans and advances.
4. Procedure to borrow loans and advances should be made more liberal.
5. Most of the respondents say that the duration between applying for loan and disbursement
of loan amount needs to be minimized.
6. During the study most of the respondents said that the insurance coverage over the loans is
needed to be extended still more.
7. The amount of subsidies on agricultural loans should be increased in order to encourage
the farmers.
CONCLUSION
From this study I would like to conclude that the bank is playing a very significant
role in the development of Ammasandra and its surroundings. And I like to say another
important aspect without forgetting that most of the youths, unemployed and other category
people have got immense advantage from this bank by borrowing loans to start their own
business and many of them are also successful in it. Directly or indirectly the bank has
reduced the rate of unemployment in its limits.
Page 70
This study made me to understand the various types of loans available and their
features, so from this knowledge I am able to create awareness among the people around me.
According to me the students can be benefitted by borrowing the educational loans for their
higher studies which is helpful in bringing down the burden of the parents. Since it is a rural
area majority of the loans borrowed in this bank is agricultural loan.
From the previous chapter data analysis and interpretation I conclude that most of the
respondents were satisfied with the loans provided to them by the bank and they also have
made full use of those loans.
Finally, I conclude that the bank and its employees are sincerely working towards the
development and welfare of the society through their dedicated service which is
commendable.
QUESTIONNAIRE
Dear sir/madam
I am pursuing .B.B.M Degree from Tumkur University and my project topic is A
Study On Loans and Advances (with respect to State Bank of Mysore, Ammasandra).
This Questionnaire is being administered for the purpose of collecting the individual
perception on loans and advances and it will be used exclusively for academic interest. I
request you to kindly spare some time and reply to this questionnaire.
Personal information
Name:
Age:
Gender M/F:
Page 71
1. Education Qualification:
Under Graduate
Post Graduate
Graduate
Others (please specify)
2. Occupation:
Salaried
Self-employed
Retired
Others
3. Are you interested in borrowing loans?

Yes
No
4. If the answer is no, why you have not borrowed loan?

Not necessary
Unsure about repayment
Lack of information about loans

Local lenders
5. What type of loans and advances you prefer?

Personal loans
Agricultural loans
Commercial loans
MSE loans
6. Why do you prefer the above option?
Loan amount
Purpose
Interest rate
Repayment period
7. How much period do you prefer for repayment?
Less than a year
1 to 5 years
5 to 10 years
Above 10 years
8. Among the following agricultural loans, which loan do you prefer?
Drip irrigation
Scheme for purchase of land for Agr.Purpose
Farm Mechanisation
Swarna Mitra Scheme
Kisan Credit Card Scheme
9. Which loan do you like to borrow among the below listed personal loans?
Car loan
Gnanamitra education loan
Housing loan
Personal loan
My Bank Adyapak
10. Among the following micro & small enterprises loans, which do you like to borrow?
Annapurna Scheme
Loans to MSEs
Transport Operators

Page 72
11. Which loan do you like to obtain from the below listed commercial & institutional loans?
SBM School Plus
Scheme for traders
Handy loans
SBM Paryatan Plus
12. How satisfied are you with loans and advances?

Highly satisfied
Satisfied
Not satisfied
13. What are your expectations from loans?

More amount
Subsidy
Any suggestions,
THANK YOU
Page 73
BIBLOGRAPHY
Books Referred
Financial Management
Shashi K Gupta, R.K. Sharma, Neeti Gupta
Law and Practice of Banking
K. Venkataramana
Business Research Method
Research Methodology
C.R. Kothary
Websites Used
www.statebankofmysore.com
www.google.com
www.wikipedia.com
www.osun.org
News Papers
Business Times
Annual Report
ANNEXURE
LIST OF TABLES
Table
No.
Title
Page No.
Page 74
Table showing the respondents educational qualification.
Table showing number of respondents on the basis of

occupation.
Table showing the rate of interested borrowers.
Table showing the reasons for not borrowing the loans.
Table showing the preferences of borrowers in borrowing

loans and advances.
Table showing the factors that influenced the respondents to

borrow the loans.
Table showing repayment period preferences.
8
9
Table showing respondents choice from among the

following agricultural loans.
Table showing respondents preference in borrowing the
below listed personal loans.
10
Table showing respondents choice in borrowing the following

micro & small enterprises loans.
11
Table showing which loan does the respondents like to obtain

from the below listed commercial & institutional loans.
12
Table showing the level of satisfaction towards loans and

advances.
13
Table showing the expectations of the borrowers from loans.
LIST OF GRAPHS
Graph
No.
Title
Graph showing the respondents educational qualification.
Page No.
Page 75
2
3
Graph showing number of respondents on the basis of

occupation.
Graph showing the rate of interested borrowers.
Graph showing the reasons for not borrowing the loans.
Graph showing the preferences of borrowers in borrowing

loans and advances.
Graph showing the factors that influenced the respondents
to borrow the loans.
6
7
Graph showing repayment period preferences.
Graph showing respondents choice from among the

following agricultural loans.
Graph showing respondents preference in borrowing the

below listed personal loans.
10
Graph showing respondents choice in borrowing the

following micro & small enterprises loans.
11
Graph showing which loan does the respondents like to

obtain from the below listed commercial & institutional
loans.
12
Graph showing the level of satisfaction towards loans and

advances.
13
Graph showing the expectations of the borrowers from

loans.
FINANCIAL STATEMENT
BALANCE SHEET OF STATE BANK OF MYSORE
Capital & Liabilities:

Total Share Capital
Equity Share Capital
Share Application Money
Preference Share Capital
AS ON
31-03-2008
AS ON
31-03-2009
(Rs. in Crore)
AS ON
31-03-2010
36.00
36.00
0.00
0.00
36.00
36.00
0.00
0.00
36.00
-
Page 76
Reserves
Revaluation Reserves
Net Worth
Deposits
Borrowings
Total Debt
Other Liabilities & Provisions
Total Liabilities
Assets
Cash & Balances with RBI
Advances
Investments
Gross Block
Accumulated Depreciation
Net Block
Capital Work In Progress
Other Assets
Total Assets
Contingent Liabilities
Bills for collection
Book Value (Rs)
1,341.81
0.00
1,377.81
27,4 62.40
1,7 31.53
29,193.93
2,4 97.96
33,0 69.70
1,635.11
599.93
2,271.04
32,9 15.77
2,7 62.08
35,677.85
2,536.90
40,485.78
2,037.40
591.89
2,665.29
38,880.00
2,274.01
41,154.01
1,589.64
45,408.94
AS ON
31-3-2008
AS ON
31-3-2009
AS ON
31-3-2010
2,661.55
21,027.15
8,402.76
406.56
283.57
122.99
0.00
610.72
33,069.71
12,871.72
2,888.47
3,827.26
1,735.05
25,616.05
11,377.96
1,060.28
328.91
731.37
0.00
617.70
40,485.79
17,073.90
2,935.90
464.20
2,765.62
29,535.86
11,494.41
1,107.10
374.11
732.99
0.00
606.20
45,408.93
20,057.35
51.60
575.94
Page 77

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A STUDY ON LOANS AND ADVANCES (SBM)

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Meaning of Loans and Advances:

Nature and Security of Loans and Advances:

(a) Secured loans and

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Tangible assets such as plant and machinery, motor-van, etc.

Procedure of granting Loans and Advances

(I) Filling up of loan application form

Submission of form along with relevant documents

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Executing the Agreement

Arrangement of Security for Loan

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Title of the study:

Place of the study:

Statement of the problem:

Objectives of the study:

A STUDY ON LOANS AND ADVANCES (SBM)

6. To point out the nature of security provided for loans.

Scope of the study:

Duration of the study:

Limitations of the study:

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Deals with introduction of the study

Research design of the study

Shows research methodology of the study

Gives brief knowledge about the company

Theoretical background of the study

Explains the theory with related to study

Data Analysis and Interpretation

Shows the analysis and interpretation of

Findings, suggestions and conclusion

data using graphs

A STUDY ON LOANS AND ADVANCES (SBM)

branches, 10 agricultural development branches, 3 treasury branches, 1 asset recovery branch

A STUDY ON LOANS AND ADVANCES (SBM)

Management Committee of the Bank

Mr. Dilip Mavinkurve

Mr. Sushil K Bhasin

Mr. Abhay Nath

(Planning & Development)

Mr. S. Vijay Kumar

(Commercial & Institutional

Mr. M.K. Nanjunda

Mr. A.K. Basu

Mr. T. Thomas Mathew

(Vigilance & Inspection)

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Shri Dilip Mavinkurve

Dept. of Commerce & Management, .G.F.G.C. Dandinashivara

A STUDY ON LOANS AND ADVANCES (SBM)

Smt. Ratna K Makhija

Nominated by Reserve Bank of

Nominated by Reserve Bank of

India Under Section 25(1)(b) of