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Transcript of finanlpptexportfinance-100930143931
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Presentation on Six
Weeks VocationalTraining at
AXIS BANK(Forex Department)
Presented By-
Aakriti Gupta Arora Gaurav Singh
94972238253 94972238262
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INDIAN BANKING SYSTEM
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INTRODUCTION TO AXIS BANK
Promoted in 1994 by
LIC
GIC
UTI
NIICNIC
OIC
UI
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CURRENT SCENARIO
Earlier Axis Bank was known
as UTI.
It has its registered office in
Ahemdabad and central
office at Mumbai.
VISION 2015: To be the
preferred financial solutions
provider, excelling in
customer delivery throughinsight, empowered
employees and smart use of
technology.
4055
ATMS
1000
Branches
Corporate
tie ups
Third
partyalliance.
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MEMBERS OF THE BOARD
Dr. Adarshkishore
ShikhaSharma
MMAggarwal
JR Verma
RH Patil
SBMathur
RBL Vaish
MVSubhia
Rama B
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VARIOUS DEPARTMENTS AT AXIS
BANK Personal Banking
Department.
Priority Banking.
NRI Banking
Department.
Securities. Insurance.
Investment Solutions.
Forex Department.
Business Banking
Department.
Corporate Banking
Department.
Credit LaunderingDepartment.
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AXIS BANK: FOREX BRANCHES IN
LUDHIANA
Branch Name-The Mall
Branch Id-042
Address-Lower Ground
Floor, Boulevard, PlotNo.105, Mall Road,
Ludhiana 141001,
Punjab, India
MICR Code-141211002 SWIFT Code -
AXISINBB042
Branch Name-Miller
Ganj
Branch- Id 324
Address-B-15-179/1,Nirankari Kucha No. 4,
Between Vishwakarma
Chowk and Dholewal
Chowk, Miller Ganj
Punjab, India
MICR Code-141211006
SWIFT -AXISINBB324
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FUNCTIONS OF FOREX DEPARTMENT, MALL
ROAD, LUDHIANA
Transfer through SWIFT
Demand Drafts andCheques
Spot Contracts.
Forward Contracts.
Currency Options.
Forward RateAgreement.
Currency Swaps
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ORGANIZATIONAL CHART
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SWOT ANALYSIS
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INTRODUCTION TO EXPORT FINANCE
It means selling goods abroad. International market
being a very wide market, huge quantity of goods
can be sold in the form of exports.
Success or failure of any export order mainly
depends upon the finance available to execute the
order.
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CONCEPT OF EXPORT FINANCE
The exporter may require short term, medium
term or long term finance depending upon the
types of goods to be exported and the terms
of statement offered to overseas buyer.
Export finance is short-term working capital
finance allowed to an exporter. Finance and
credit are available not only to help exportproduction but also to sell to overseas
customers on credit.
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PURPOSE OF EXPORT FINANCE
An exporter may avail financial assistance from any
bank, which considers the ensuing factors:
Availability of the funds at the required time to the
exporter.
Affordability of the cost of funds.
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TYPES OF EXPORT FINANCE
Export finance is classified into two types viz.
Pre-shipment finance.(180 days-270 days)
Post-shipment finance. (180 days)
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SOME CONCEPTS OF EXPORT
FINANCE Forfeiting - A mechanism of financing exports.
By discounting export receivables.
Evidenced by bills of exchange or promissory notes. Without recourse to the seller (viz. exporter)
On a fixed rate basis (discount)
Up to 100 percent of the contract value.
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FACTORING- A contract by which the factor is toprovide at least two of the services, (finance, the
maintenance of accounts, the collection of receivables
and protection against credit risks) and the supplier is
to assigned to the factor on a continuing basis by way
of sale or security, receivables arising from the sale of
goods or supply of services.
In simple words, factoring turns your receivable into
cash today, instead of waiting to be paid at a futuredate.
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MAJOR INSTITUTIONS INVOLVED
IN EXPORT FINANCE Reserve Bank of India (RBI)- The RBI with its head
quarters in Mumbai and several regional offices is the central
banks of our country to authorize extend and regulate export
credit and transaction including foreign exchange affairs. RBIdoes not directly provide export finance to the exporters, but
it adopts policies and initiates measures to encourage
commercial banks and other financial institutions to provide
liberal export finance. Two Departments- i)Industrial and Credit Department
ii)Exchange Control Department
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Exim Bank- Set up by an Act of Parliament in September
1981.
Wholly owned by the Government of India.
Exim is the principal financial institution in the country for
coordinating working of institutions engaged in financing
exports and imports.
Offices
Head office Mumbai
A network of 13 offices in India and Overseas.
Domestic Offices - Ahmedabad, Bangalore, Chennai,Hyderabad, Kolkata, Mumbai, New Delhi, Pune.
Overseas Offices - Budapest, Johannesburg, Milan, Singapore,
Washington DC.
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Functions of EXIM Bank
From financing Facilitating Indiaforeign trade and promoting Foreigntrade.
To creating export capability byarranging competitive financing atvarious stages of export cycle.
Providing Consultancy and high range ofservices to exporters.
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ECGC- EXPORT CREDIT GUARANTEE
CORPORATION OF INDIA LTD.
ECGC is a company wholly owned by the GOI. It
functions under the administrative control of the
Ministry of Commerce and is managed by a Board of
Directors representing government, Banking,Insurance, Trade and Industry.
OBJECTIVES OF ECGC:
To protect the exporters against credit risks, i.e. non-
repayment by buyers
To protect the banks against losses due to non-repayment of
loans by exporters.
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PRE-SHIPMENT FINANCE-Pre-shipment is also
referred as packing credit. It is working
capital finance provided by commercial banks
to the exporter prior to shipment of goods.The finance required to meet various
expenses before shipment of goods is called
pre-shipment finance or packing credit.
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IMPORTANCE OF FINANCE AT PRE-SHIPMENT STAGE:
To purchase raw material, and other inputs to
manufacture goods.
To assemble the goods in the case of merchant
exporters.
To store the goods in suitable warehouses till the
goods are shipped.
To pay for packing, marking and labelling of goods.
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SOME SCHEMES IN PRE-SHIPMENT STAGE OF FINANCE
I. DEFERRED CREDIT-Consumer goods are normally
sold on short term credit, normally for a period up
to 180 days. However, there are cases, especially, in
the case of export of capital goods andtechnological services; the credit period may
extend beyond 180 days. Such exports were longer
credit terms (beyond 180 days) is allowed by the
exporter is called as deferred credit or deferredpayment terms.
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REDISCOUNTING OF EXPORT BILLS ABROAD
(EBRD) SCHEME-This facility will be an additional
window available to exporter along with the exiting
rupee financing schemes to an exporter at postshipment stage. This facility will be available in all
convertible currencies. This scheme will cover
export bills upto 180 days from the date of
shipment (inclusive of normal transit period andgrace period) .
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POST-SHIPMENT FINANCE
MEANING:
Post shipment finance is provided to meet working
capital requirements after the actual shipment of
goods. It bridges the financial gap between the dateof shipment and actual receipt of payment from
overseas buyer thereof. Whereas the finance
provided after shipment of goods is called post-
shipment finance.
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Importance of Post Shipment
Finance. To pay to agents/distributors and others for their
services.
To pay for publicity and advertising in the over seas
markets. To pay for port authorities, customs and shipping
agents charges.
To pay towards export duty or tax, if any.
To pay towards ECGC premium.
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Methods of Post Shipment
Finance. Export bills negotiated under L/C
Purchase of export bills drawn
under confirmed contracts
Advance against Undrawn
Balance of Bills:
Advance against Deemed Exports
Advance against bills under
collection
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Packing Credit for Rupee Expenditure
for project export contracts PACKING CREDIT FOR RUPEE EXPENDITURE FOR PROJECT EXPORT
CONTRACTS (FREPEC).
WHAT IS FREPEC PROGRAM?
This program seeks to Finance Rupee Expenditure for
Project Export Contracts, incurred by Indian companies.
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What is the purpose of this Credit?
To enable Indian project exporters to meet Rupee
expenditure incurred/required to be incurred for executionof overseas project export contracts such as for
acquisition/purchase/acquisition of materials and
equipment, acquisition of personnel, payments to be
made in India to staff, sub-contractors, consultants and to
meet project related overheads in Indian Rupees.
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Foriegn Currency Preshipment Credit
The FCPC is available to exporting companies as well as
commercial banks for lending to the former.
It is an additional window to rupee packing credit scheme &
available to cover both the domestic i.e. indigenous &
imported inputs. The exporter has two options to avail him of
export finance.
To avail pre-shipment credit in rupees & then the post
shipment credit either in rupees or in foreign currency
denominated credit or discounting /rediscounting of exportbills.
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Title- Comparative Analysis onExport finance execution by public
and private banks in respect toSME exporters in Ludhiana zone.
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Objectives of Research
To compare export finance execution between public and
private banks in respect to SME exporters in Ludhiana
zone on the basis of various parameters ie maximum
disbursement made to product or industry,centralized and
decentralized system of loan scantioning,in terms of Base
and bench prime lending rate,subvention rates,Turn around
time,Bill realization charges.
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To compare among public and private banks that which
sector of banks encourages new exporters in terms of fund
based assistance.
To know that which industry or product will be financed
aggressively by Public and private banks respectively to
SME exporters in Ludhiana.
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Research Methodology
Objectivesof the study
ResearchDesign
SampleDesign
Datacollection
DataAnalysis
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Research Design
Research design specifies the methods and procedures
for conducting a particular study.
Research design is broadly classified into three
types as: Exploratory Research Design.
Descriptive Research Design.
Causal Research Design. Our design is Descriptive Research Design.
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SAMPLING DESIGN A Sample Design is a definite plan for obtaining a sample from a given
population. It refers to the technique to the procedure adopted in selectingitems for the sampling designs are as below:
SAMPLE SIZE:The substantial portions of the target Banks in
Ludhiana that are sampled to achieve reliable result are 20Banks.
The cost and time limitation compelled us to select 20
respondents as sample size .
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SAMPLING METHOD:
In this research project, we are using
Convenience sampling method.
SAMPLE SIZE
20 banks.
SAMPLE TYPEAREA SAMPLING
Sample Area: Ludhiana
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SAMPLING TECHNIQUE
We have taken the Statistical tool of percentage method to
analysis and interpretation of the collected data.
Convenience Sampling
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Collection of Data
DATA COLLECTION
The study was conducted by the means of
personal interview with respondents and the
information given by them were directly
recorded on questionnaire.
COLLECTION TECHNIQUE
Questionnaire method is used in collection
the data.
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Banks Chosen For comparison PUBLIC BANKS
State Bank of India.
Bank Of India.
Indian Bank.
Syndicate Bank. Corporation Bank.
Canara Bank.
Central Bank of India.
Punjab National Bank.
SIDBI
Vijaya Bank
PRIVATE BANKS
Icici Bank.
HDFC Bank.
Standard Charted Bank.
Axis Bank. Catholic Serian Bank.
Fedral Bank.
City Bank.
South Indian Bank.
IndusInd Bank.
Yes Bank.
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Data Analysis Public BanksMAXIMUM DISBURSEMENT MADE TO LUDHIANA
SME EXPORTERS BY PUBLIC BANKs IN Ludhiana. Interpretation 60 % of public banks do not disburse
more than 50 crores annually to Ludhiana
SME export houses. These include
Vijaya Bank.
Indian Bank.
SIDBI.
Syndicate Bank.
Corporation Bank.
Central Bank.
While 30% of public banks Disburse more
than 150 crore Rupees which include
State Bank of India.
Bank of India.
Canara Bank.
While 10% Banks make disbursement of
Rs. 50-100 crores that is Punjab national
bank.
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Sectorwise Maximum
Disbursement.Interpretation
30% of public banks in Ludhiana Disburse
maximum to Ludhiana Bi-cycle Sme
exporters. These include
State Bank of India.
Bank of India.
Indian Bank.
Whereas 40% of finance is disbursed to
Hosiery SME exporters. These include
Canara Bank.
Central Bank.
Syndicate Bank.
Vijaya Bank.
While 20% of the Banks go for
disbursement in Yarn. These include Corporation Bank.
SIDBI(Small Industries Development Bank
of India).
While 10% of the banks that is Punjab
National Bank Go out to Disburse Iron and
Steel the most.
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LOAN SANCTIONING POWER Interpretation 10% of the Public Banks havecentralized
sanctioning system and have nil
sanctioning Power i.e Vijaya Bank. While 20% of the banks have Sanctioning
Power of Rupees Less than 1crore.These
include Central Bank of India,Indian
Bank.
While 50 % of the Public banks have
sanctioning power of Rs 1 crore- Rs 5crore. These include.
SIDBI (Small Industries Development
Bank Of India)
Bank of India.
Corporation Bank.
Syndicate Bank,Canara Bank. While 10% of the public Bank, has the
sanctioning power of Rs 1 crore which is
State Bank of India.
While 10% of the Public Bank, has the
sanctioning power of More than Rs 5
crore. That is Punjab National Bank.
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Sector or product considered
safe to fund.Interpretation 20% of the Public Banks Consider Bi-cycle Sme
Export as the safe area to Fund. These Include
State Bank of India. Bank of India.
While 20% of the Banks Consider Hosiery Sme
exporters as the safe area to fund. These
Include
Vijaya Bank.
Central Bank of India.
And 20% of the Banks consider Hand Tool Smeexporters as safe area to fund .These Include
Indian Bank.
Syndicate Bank.
While 30% of the Banks consider all the
products safe to fund depending upon the
proposal and reputation of the exporter. These
Include
SIDBI.
Canara Bank.
Punjab National Bank.
10 % go for yarn that is corporation Bank.
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Subvention offered Interpretation
The Fig shows the subvention rateoffered to the Ludhiana SME exporters
and 90% of the
Banks subvent 0%-2%.These include
State Bank of India.
Punjab National.
Bank of India.
Indian Bank.
Corporation Bank.
Vijaya Bank.
Syndicate Bank.
Canara Bank.
Central Bank of India.
While 10% of the public Bank that is
SIDBI has fixed Lending Rate and does
not any kind of Subvention to the SME
exporters.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Question 6
0%-2%
2%-4%
4%-6%
Any other
NA
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In terms of Fund Based
assitence to new exportersInterpretation
60% of the Public Banks state that they
encourage new exporters and provide
them complete fund based assistanceas they do to old exporters.
These Include
State Bank of India.
Punjab National.
Bank of India.
Indian Bank.
Corporation Bank.
Vijaya Bank.
While 40% of the banks stay neutral
while providing fund based assistance
to new exporters. These include
Syndicate Bank.
Canara Bank.
Indian Bank.
SIDBI.
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In terms of Turn Around Time. Interpretation
60 % of the Public banks disburse the
case with in the time span of 0-2 days.These include
State Bank of India
Punjab National Bank
Bank of India.
State Bank of India.
Indian Bank.
Central Bank of India.
While 10% of the Public Banks taken
take 2-4days to disburse the case that is
SIDBI (Small industries Development
Bank of India.)
While 10% of the banks take 4-6 days to
disburse the case that is
Coporation Bank.
While 20% of the banks take more than
6 days to disburse the case that includes
Syndicate Bank. Vijaya bank.
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Processing Fee Charges Interpretation
60% of the Public Banks charge 0.6-1%
of the Loan amount as the processingfee.These include
Bank of India.
Syndicate Bank.
SIDBI.
Canara Bank.
Vijaya Bank .
Canara Bank.
While 40% of the Public Banks charge
0.1-0.5% of the loan amount.Thes
include
Indian Bank.
Punjab National Bank.
State Bank of India.
Central Bank of India.
While no bank charges 0% and more
than 1% of the processing fee.
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In Terms of Bill Realisation
ChargesInterpretation
10% of the banks have Nil Bill realization
charges. That is
Canara Bank.
The Fig also represents that 20% of the banks
charge Rs 500 + Service Tax. That includes
Central Bank of India.
Punjab National Bank.
The Fig also represents that 50% of the banks
charge 1000+ST of the Bill as Bill realizationCharges. These includes
Vijaya Bank .
Corporation Bank.
Syndicate Bank .
Indian Bank.
SIDBI.
The above Fig also Represents that 10 % of the
Banks charge more than Rs 1000+ST that is
Bank of India.
While in the research State Bank of India
Charges Minimum Rs 700 or 0.15% of the Bill.
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In terms of Balancesheets
and ITR required Interpretation
The above Fig represent thatNumber of years of Balance Sheets
Required and Income Tax Return
Required to Furnish to the bank for
Export Finance. These include all the
public banks require for three years.
State Bank of India.
Punjab National.
Bank of India.
Indian Bank.
Corporation Bank.
Vijaya Bank.
Syndicate Bank.
Canara Bank.
Central Bank of India.
SIDBI.
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Opinion of banks to fund SME
exporters aggresively in
coming two years.
Interpretation
30% of Banks said that they will
go for Bi-cycle these include SBI,PNB,Indian Bank.
60% will go for Textile out of
which 40% will go for yarn and
20% will go for Hosiery these
include corporationBank,SIDBI,Syndicate
Bank,Vijaya Bank.
And 20% comprise of Canara
and Bank of India.
Whlie Central Bank of India willgo for Hand Tool.0%
10%
20%
30%
40%
50%
60%
Category 1
Bi-cycle
Textile
Yarn
option b.3
option c
option d
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Comparison in terms of Rate of Interest
SNO Name of Bank BPLR BASE RATE
1 SBI 11.75% 7%
2 PNB 11% 8%
3 BANK OF INDIA 12% 8%
4 CENTRAL BANK OFINDIA
12% 8%
5 CORPORATION
BANK OF INDIA
12% 7.75%
6 SIDBI 11% 7.5%
7 INDIAN BANK 12.50% 8%
8 SYNDICATE BANK 12% 8.25%
9 VIJAYA BANK 12.15% 8.25%
10 CANARA BANK 12% 8%
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The above table represents the comparison between
the BPLR and Base rates between the public banks.
From the above table it is clear that
PUNJAB NATIONAL BANK and SIDBI come up with thelowest BPLR and PNB also goes to subvent up to 2%
there by making lending rate more lower, however
SIDBI does not go out for further subvention.
SBI stands out to have the lowest Base rate that is
7%.
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Private BanksDisbursement made by pvt
banks.
Interpretation.
60% of private banks do not disbursemore than 50 crores annually to
Ludhiana SME export houses. In these
60% the private banks are-
Catholic Bank
Federal Bank
IndusInd Bank
South Indian Bank
Standard Chartered
Yes Bank
While 40% of private banks disburse
more than 150 crore rupees which
include-
Axis Bank
Citi Bank
HDFC Bank
ICICI Bank
.
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Industry-productwise
disbursementInterpretation
0% of private banks in Ludhiana Disburse
maximum to Ludhiana Bi-cycle Smeexporters.
Whereas 30% of finance is disbursed to
Hosiery SME exporters. These include
Axis Bank.
Citi Bank.
HDFC Bank.
While 60% of the Banks go for
disbursement in Yarn. These include
Catholic Syrian Bank.
Federal Bank.
ICICI Bank.
IndusInd Bank.
South Indian Bank.
Standard Chartered.
While 10% of the banks that is Yes Bank
goes out to Disburse Iron and Steel the
most.
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In terms on Loan scantioning
PowerInterpretation
60% of the Private Banks have a centralized
sanctioning system and have nil sanctioning
Power. Which includes:
Catholic Syrian Bank.
Citi Bank.
HDFC Bank.
IndusInd Bank.
Standard Chartered Bank.
Yes Bank.
While 10% of the banks have Sanctioning
Power of Rupees Less than 1crore.These
include
South Indian Bank.
While 0 % of the Public banks have
sanctioning power of Rs 1 crore- Rs 5 crore.
While 30% of the Banks, have the sanctioning
power of Rs 1 crore which are
Axis Bank.
Federal Bank.
ICICI Bank.
While 0% of the Private Banks, has the
sanctioning power of More than Rs 5 crore.
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SECTOR OR PRODUCT WHICH
IS CONSIDERED AS SAFE ZONE
TO FUND
Interpretation 10% of the Private Banks Consider Bi-cycle
Sme Export as the safe area to Fund. These
Include ICICI Bank.
While 40% of the Banks Consider Hosiery Sme
exporters as the safe area to fund. These
Include
AxisBank.
Citi Bank.
South Indian Bank.
Yes Bank.
And 30% of the Banks consider Hand Tool Sme
exporters as safe area to fund .These Include
Catholic Syrian Bank.
Federal Bank.
IndusInd Bank. Hand Tools is supported by 20% of the banks.
Standard Chartered
ICICI Bank.
While 10% of the Banks consider all the
products safe to fund depending upon the
proposal and reputation of the exporter. That
is HDFC Bank
SUBVENTION RATES OFFERED
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SUBVENTION RATES OFFERED
BY PUBLIC BANKS TO SME
EXPORTERS Interpretation
The above Fig shows the subvention rateoffered to the Ludhiana SME exporters and
70% of the Public Banks subvent 0%-2%.These
include
Axis Bank.
Catholic Syrian Bank.
Citi Bank.
Federal Bank. ICICI Bank.
IndusIndBank.
Yes Bank.
While 10% of the public Bank that is Standard
Chartered allows Subvention of 2-4% to the
exporters.
While 20% banks subvent 4-6%
HDFC Bank.
South Indian Bank.
BANKS IN TERMS OF FUND
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BASED ASSISTANCE TO NEW
EXPORTERSInterpretation
The above fig clearly shows that 0% of the
Private Banks encourage new exporters and
do not provide them any fund basedassistance as they do to old exporters.
By new exporters it means that an exporter
without any Income tax Return and Balace
Sheets.
While 40% of the banks stay neutral while
providing fund based assistance to new
exporters. These include
ICICI Bank.
IndusInd Bank.
Standard Chartered Bank.
South Indian Bank.
Whereas 60% of the the private banks said
that they are very rigid in providing any
assistance to new exporters. Which are: Axis Bank.
Catholic Syrian Bank.
Citi Bank.
Federal Bank.
HDFC Bank.
Yes Bank.
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TURN AROUND TIME FOR
DISBURSEMENT AFTER
SUBMISSION OF DOCUMENTSInterpretation
From the above fig it is clear that 10 % of the
Private banks, i.e. Axis Bank disburse the case
with in the time span of 0-2 days.
While 10% of the Private Banks, i.e. Yes Bank
takes 2-4days to disburse the case.
While 10% of the banks take 4-6 days to
disburse the case that is ICICI Bank.
While 70% of the banks take more than 6
days to disburse the case that includes
Catholic Syrian Bank.
Citi Bank.
Federal Bank.
HDFC Bank.
IndusInd Bank.South Indian Bank.Standard
Chartered Bank.
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PROCESSING FEE CHARGES
Interpretation
The above fig represents the processing feecharges charged by the Public Banks.
60% of the Private Banks charge 0.1-0.5% of
the Loan amount as the processing fee. These
include
Federal Bank.
HDFC Bank.
ICICI Bank. South Indian Bank.
Standard Chartered Bank.
While 50% of the Public Banks charge 0.6-1%
of the loan amount. These include
Axis Bank.
Catholic Syrian Bank.
Citi Bank.
IndusInd Bank.
Yes Bank.
While no bank charges 0% and more than 1%
of the processing fee
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IN TERMS OF INCOME TAX
RETURN REQUIRED Interpretation
Shows that only 1 bank thatis federal bank requires the
income tax return for 1 year
to be submitted by the SME
exporters, rest all the
private banks considered by
us require income tax
returns for 3 years
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IN terms of funding sector
wise in next two years Interpretation
The above figure shows a
very scattered response of
the banks when they were
asked about the industry
that they feel will bebooming in the next 2
years.
10% of the private banks,
i.e. axis bank said that bi-cycle industry will be
aggressively funded in the
next two years.
C i i T f I t t R t i P i t
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Comparison in Terms of Interest Rates in Private
BanksSNO Name of Bank BPLR Base Rate
1 Standard
Charted Bank
16% 7.25%
2 City Bank 15% 7.5%
3 Axis Bank 14.75% 7.50%
4 South IndianBank
16.% 8.10%
5 ICICI Bank 15.75% 7.5%
6 Catholic
Serian Bank
14.75% 8%
7 Fedral Bank 15.25% 7.75%
8 HDFC Bnak 15.75% 7.5%
9 Indusind
Bank
16.75% 7%
10 Yes Bank 16.50% 7%
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Interpretation
From the above table it is clear that:
IndusInd Bank lends out with Highest BPLR
that is 16.75% but on the same hand the base
rate is 7%.
Whereas Yes Bank has lowest Base Rate that is
7% with Indusind bank.
Where as the Leading Banks HDFC and ICICI
stand common in terms of BPLR as well as
base rate.
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Conclusion and findings
Export Finance is a very important branch to
study & understand the overall gamut of the
international finance market.
Availability of favorable Export financeschemes directly impacts the local trade,
encourages exporters, enlarges markets
abroad, improves quality of domestic goodsand overall helps the nation boost its
exchange earnings.
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Comparison
60% of public banks do not
disburse more than 50cr
annually to Ludhiana SME
export houses.
Where as 40% of the PublicBanks disburse finance to
Hoseiry exporters.
While 50 % of the Public
banks have scantioningpower of Rs 1 crore- Rs 5
crore that means they have
De-centralised system of
Funding.
60 % of the private banks
also donot disburse more
than 50cr to SME exporters
in Ludhiana.
Where as 60% of the Privatebanks go to Disburse for
Yarn.
60%of the Private Banks
have NILL scantioningpower at their end and have
centralized system and get
the cases approved from
their respective corporate
offices.
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In terms of Safe funding
industry Public banks(30%)
consider all viable projectssafe to fund.
Public Banks Have less rate
of Interest.
And in terms of subvention90% of the public banks
subvent 0-2%.
In case of Private Banks
maximum Private
Banks(60%) find Bicycle Smeexporters safe to fund.
Have more rate of
Interest.
Where as 50% of the private
banks subvent 0-2% but
40% of the private banks
subvent more 4-6% down
their lending rates to be incompetition with public
banks
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In terms of fund basedassistance to the new
exporters Public banks
completely over ruled
Private Banks as 60% of saidthat they provide maximum
complete fund based
assistance to fresh
exporters. In terms of processing fee
charges 60% of the public
banks charge 0.6%-1%
Where as no private
bank said that it
encourages most to
new exporters.
50% of the private banks
charge the same however
the processing fee charges
could be reduced but it
depends upon the
reputation of exporter and
discretion of the Bank
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In terms of Bill realizationcharges only 50% public
banks charge Rs
1000+service tax.
However in terms of Incometax returns and Balance
sheets required both Public
and private banks are equal.
Where as all the privatebanks charge Rs
1000+service tax that makes
public banks better than
private banks. But in terms of customer
attention and co-operation
Private banks are better
than Public Banks howeverING VYSYA Bank is an
exception.
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Thank you