PART ONE

INTRODUCTION

BANKING HISTORY:
Banking in India originated in the first decade of 18th century with The General Bank of India coming into existence in 1786. This was followed by Bank of Hindustan. The oldest bank in existence in India is the State Bank of India being established as "The Bank of Calcutta" in Calcutta in June 1806. Couple of decades later, foreign banks like HSBC and Credit Lyonnais started their Calcutta operations in the 1850s. At that point of time, Calcutta was the most active trading port, mainly due to the trade of the British Empire, and due to which banking activity took roots there and prospered. The first fully Indian owned bank was the Allahabad Bank set up in 1865. By the 1900s, the market expanded with the establishment of banks like Punjab National Bank, in 1895 in Lahore; Bank of India, in 1906, in Mumbai both of which were founded under private ownership. Indian banking sector was formally regulated by Reserve Bank of India from 1935. After India's independence in 1947, the Reserve Bank was nationalized and given broader powers. NATIONALIZATION The next significant milestone in Indian Banking happened in the late 1960s when the then Indira Gandhi government nationalized, on 19th July, 1969, 14 major commercial Indian banks, followed by nationalization of 6 more commercial Indian banks in 1980. The stated reason for the nationalization was more control of credit delivery. After this, until the 1990s, the nationalized banks grew at a leisurely pace of around 4% also called as the Hindu growth of the Indian economy

To understand the Indian banking sector more easily a diagram is shown regarding the name as the bank, its numbers shown in the bracket and also the category of bank under which it falls.

STRUCTURE OF THE ORGANIZED BANKING SECTOR IN INDIA.

HDFC BANK

The Housing Development Finance Corporation Limited (HDFC Ltd) was amongst the first to set up a bank in the private sector. The bank was 4

incorporated on 30th August 1994 in the name of HDFC Bank Limited, with its registered office in Mumbai. It commenced its operations as a Scheduled Commercial Bank on 16th January 1995. The bank has grown consistently and is now amongst the leading players in the industry. In a milestone transaction in the Indian banking industry, Times Bank was merged with HDFC Bank Ltd., effective February 26, 2000. The amalgamation added significant value to HDFC Bank in terms of increased branch network, expanded geographic reach, enhanced customer base and skilled manpower. As of 1st April 2005, the Bank has an enviable network of 2725 branches spread over 779 cities across the country. All branches are linked on an online real-time basis. It also has a network of over 4232-networked ATMs across these cities. Moreover, all domestic and international cardholders can access its ATM network. Visa/Master Card, Visa Electron/Maestro, Plus/Cirrus and American Express Credit/Charge

HDFC BANK TOP MANAGEMENT

Jagdish Capoor Aditya Puri Group heads A Rajan Abhay Aima Ashish Parthasarthy Bharat Shah CN Ram G Subramaniam Harish Engineer Kaizad Barucha Mandeep Maitra Sudhir Joshi Vinod Yennemadi Samir Bhatia Parlay Mondal Chairman Managing director

Operations Equities and private banking Trading Depository and merchant services Information technology Audit, compliance, service quality Wholesale banking Credit and market risk Human resources Treasury Finance, admin, legal Corporate banking Unsecured products

Vision & Mission:

HDFC Banks mission is to be a World-Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the banks risk appetite. The bank is committed to maintain the highest level of ethical standards, professional integrity, corporate governance and regulatory compliance. HDFC Banks business philosophy is based on four core values Operational Excellence, Customer Focus, Product Leadership and People.

PERFORMANCE
HDFC bank has been proved itself as a very fast growing bank and a good competitor for another similar sectors and the bank have won various awards by its good performance. There are some aspect of HDFC on the basis of good performances in different fields and area. HDFC Bank provides correspondent bank services to Co-operative Banks, Private Banks, and Foreign Banks & RRB's. Banks can leverage HDFC banks branch network, technology and product capability. Bank has a wide range of products engineered to suit the needs of the banking sector this is backed up by a dedicated Relationship Management Team and dedicated servicing department. Bank has the privilege of being a direct member of the RBI clearing house. So bank act as the sponsor bank of co-operative, private and foreign banks, which are not direct members of the RBI clearing house. Accordingly, we professionally deal with the entire clearing and settlement processes for the sub-member bank Bank wide network of branches across the country, is an advantage. Bank has entered correspondent banking arrangements to cover locations where we do not have a direct presence. As a part of the correspondent banking services, we offer the facility of speedy collection of cheques for movement of funds across locations HDFC Bank has 4,727 ATMs spread across the country. We can extend the usage of our ATMs for our correspondent banking tie-ups. HDFC Bank is the leading correspondent banking service provider in the country. Through cutting edge technology we have provided our infrastructure and products to a large number of banks across the 8

country. These include co-operative, private and foreign banks who avail of our network and products and services which have been engineered and customised for individual banks.

Cross-branch functionality on the system enables the online transfer of funds in all HDFC Bank locations. This includes direct remittance into customer's account held with us and issuance of local managers' cheques at the respective locations as per instructions given by the bank. wide network of branches, spread across India , is an advantage. Besides, the bank has entered into various correspondent banking arrangements to cover locations where we do not have a direct presence. As part of the correspondent banking services, we offer the facility of efficient and economic movement of funds across locations.

AWARDS AND HONORS WON BY THE HDFC BANK IN 2010:

HDFC Bank began operations in 1995 with a simple mission: to be a "Worldclass Indian Bank".

2010
NDTV Business Best Private Sector Bank Leadership Awards 2010 MIS Asia IT BEST BOTTOM-LINE I.T. Category Excellence Award 2010 Dun & Bradstreet Banking Awards Overall Best Bank 2010 Best Private Sector Bank Best Private Sector Bank in SME Financing Institutional HDFC Bank MD, Mr. Aditya Puri among "Asian Captains Investor Magazine of Finance 2010" Poll IDRBT Technology Winner - 1) IT Infrastructure 2) Use of IT within the Bank 2009 Awards Runners-up - IT Governance (Large Banks) ACI Excellence Highly Commended - Asia Pacific HDFC Bank Awards 2010 FE-EVI Green Best performer in the Banking category Business Leadership Award Celent's 2010 Model Bank Award Banking Innovation Award Avaya Global Customer Responsiveness Award - Banking & Financial Connect 2010 Services category Forbes Top 2000 Our Bank at 632nd position and among 130 Global High Companies Performers Financial Express Ernst & Young Best New Private Sector Bank Survey 2009-10 Best in Growth Best in strength Asian Banker 10

Excellence Awards 2009

Best Retail Bank in India Excellence in Automobile Lending Bank M&A Integration Technology Implementation

The Asset Triple A Best Cash Management Bank in India Awards Euromoney Private 1) Best Local Bank in India (second year in a row) 2) Best Banking and Private Banking Services overall (moved up from No. 2 last Wealth year) Management Poll 2010 Financial Insights Innovation in Branch Operations - Server Consolidation Innovation Awards Project 2010 Global Award Finance Best Trade Finance Provider in India for 2010

2 Banking 1) Best Risk Management Initiative and 2) Best Use of Technology Awards Business Intelligence. 2009 SPJIMR Marketing 2nd Prize Impact Awards (SMIA) 2010 Business Today Listed in top 10 Best Employers in the country Best Employer Survey

Various honors can be summed up as follows: 1. The Business Today-KPMG Survey published in the leading Indian business magazine Business Today has named HDFC Bank "Best Bank in India" for the third consecutive year in 2005. 2. The Asset magazine named HDFC Bank "Best Cash Management Bank" and "Best Trade Finance Bank" in India, in 2006. 3. HDFC Bank named the "Most Customer Responsive Company Banking and Financial Services" in The Economic Times - Avaya Global Connect Customer Responsiveness Awards 2005" 4. HDFC Bank has been named "Best Domestic Bank in India" in The Asset Triple A Country Awards 2005. 5. In 2004, HDFC Bank won the award for "Operational Excellence in 11

Retail Financial Services" - India as part of the Asian Banker Awards 2003. 6. In 2003, Forbes Global named us in its ranking of "Best Under a Billion, 200 Best Small Companies for 2003". 7. Leading business newspaper The Financial Express named HDFC Bank the "Best New Private Sector Bank 2003" in the FE-Ernst & Young Best Banks Survey 2003. 8. NASSCOM and economictimes.com have named us the 'Best IT User in Banking' at the IT Users Awards 2003. 9. Company of the Year Award in The Economic Times Awards for Corporate Excellence 2004-05. 10. Finance Asia Best Bank - India in 2005, "Best Domestic Commercial Bank India in 1999, 2000 and 2001 respectively and Best Local Bank India in 2002 and 2003.

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BUSINESS DIVISIONS:
The bank has three key business departments: 1. Wholesale Banking Services: In this field target market is primarily large, blue-chip companies and to a lesser extent, emerging mid-sized corporate. For these corporate, bank provide a wide range of services, including working capital finance, trade services, transactional services, cash management, etc.. 2. Retail Banking Services: The objective of the Retail Bank is to provide target market customers a full range of financial products and banking services, giving the customer a onestop window for all his/her banking requirements. The products are backed by world-class service and delivered to the customers through the growing branch network, as well as through alternative delivery channels like ATMs, Phone Banking, Net Banking and Mobile Banking. 3. Treasury Operations: Within this business, the bank has three main product areas a) Foreign Exchange and Derivatives b) Local Currency Money Market c) Debt Securities and Equities. With the liberalization of the financial markets in India, corporate need more sophisticated risk management information, advice and product structures. These are provided through the bank's Treasury team. The Treasury business is responsible for managing the returns and market risk on the bank's investment portfolio.

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PRODUCT & SERVICES

Travelers Cheques Foreign Currency Cash ForexPlus card ForexPlus Chip card Foreign Currency Demand Drafts Cheque Deposits Remittances Cash to Master Trade Services

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TRADE FINANCE:
Trade is an important part of commerce. It refers to the sale, transfer or exchange of goods and services for a certain price. Exchange of goods and services is the basis of trade. Trade can be classified into two parts: 1. External trade 2. Internal trade

1. External trade:
External trade or foreign trade involves trading of goods among countries of the world. Every country buys and sells different goods from and to other countries. Goods worth crores are bought and sold. Foreign trade is an important economic activity because it enables the countries participating in it to secure resources for economic development as well as for balance of payment. For some countries foreign trade is the most important economic activity because most of their industrial activities are dependant on it.

Nature of external trade: It consists of export trade and import trade. Export trade involve sale of goods of purchases to other countries. Imports consist transactions from other countries. When goods are traded then it is called visible trade. External trade in services is called invisible trade. When goods are imported into a country with the purpose of re-exporting them to some country, it is known as entrepot trade. There are two types of external trade: 15

1. Import of goods and services 2. Export of goods and services

External Trade Services (in context to HDFC Bank):

As a business professional they need flexibility, which helps in closing a deal faster, and maintaining goodwill with business associates. At HDFC Bank, they have always been committed to understand customers needs.

A. Facilities of goods and services

HDFC Bank offers a wide range of export services designed to assist the business and its opportunities around the world. Routing all the export related transactions it helps in facilitating all the export related hassles of the customers. The customers can get the following facilities with the expertise and experience of the bank: 1. Faster payment 2. Competitive exchange rates 3. Increased control over foreign receivables 4. Improved cash flows For the following export bills: 1) Export documents against payment 2) Export documents against acceptance 3) Export bills under letter of credit 4) They also provide packing credit and bill discounting facilities.

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B. Import of goods and services

HDFC Bank offers its customers a comprehensive range of import services. HDFC bank is highly respected in the world of in international finance a cross border transaction. The bank has correspondent relationship with other reputed international banks throughout the world can provide all the services to importers who may be importing from any part of the world. The following facilities are available for importers: 1. Direct remittance Customer may require the exporter overseas to dispatch the goods first and then remit the payment for the goods. The exporter would then dispatch the goods to customer. The overseas exporter will then send the documents directly to you. When you approach us along with the documents for sending remittance to the exporter, we will ensure that the remittance is done promptly

Documentation for Direct Remittance: a) Request Letter cum Debit Authority cum OGL cum FEMA Declaration b) IE Code Number Certificate c) Form A1 d) KYC Report e) Transport Docs in original - Bill of Lading / Airway Bill f) Invoice g) Bill of Entry (Exchange Control Copy)

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2. Advance remittances

The overseas exporter may require making full payment in advance for the goods to be exported to. The exporter would dispatch the goods after he receives full payment.

For this purpose, HDFC Bank will make your remittance in foreign currency to the exporter at a very competitive rate.

a) Request Letter cum Debit Authority cum OGL cum FEMA Declaration b) IE Code Number Certificate c) Form A1. (Duplicate) d) KYC Report e) Purchase Order / Performa Invoice with Advance payment term. f) Bill of Entry Declaration with Commercial Invoice g) Bank Guarantee from the Exporters Bank if Advance amount is > $ 1, 00,000. 3. Import bills under letter of credit In a business cycle, as buyer needs to pay for his purchases in international and domestic markets. Letter of credit helps to facilitate purchase of goods in international and domestic trading operations. All HDFC Banks letters of credit issued are valued and accepted worldwide. When the importer opens an LC through HDFC Bank for imports of goods, it is an undertaking by HDFC Bank that if the exporter exports the goods and produces the documents as stipulated in the Letters of Credit, then HDFC Bank would honor the draft(s).

4. Import collection: The exporter from overseas exports the goods to customer. The overseas 18

exporter / exporter's bank sends the documents to HDFC Bank on collection. The Bank will then intimate customer about the receipt of the documents. All customer need to do is to authorize us to debit customers a/c and send the remittance to the exporters bank. If it is a sight bill (Documents against Payment), then the necessary documents and debit authority is collected from you and remittance is paid to the exporters bank and the documents are released to you. If it is an issuance bill (Documents against Acceptance), then the acceptance letter is taken from you and the documents are released. On the due date remittance is made to the exporters bank by debiting your account

5. Letter of credit: In a business cycle, as a buyer customer need to pay for his purchases in international and domestic markets. Letters of credit helps a customer to facilitate purchase of goods in international and domestic trading operations. All our letters of credit issued are valued and accepted worldwide. 6. Bank guarantee: The bank issues bank guarantees on behalf of its customers to fulfill any obligation under the business contracts with the help of which the business can improve along with relationships with the bank.

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TYPES OF INTERNATIONAL/EXTERNAL TRADE SETTLEMENT:

In international business the settlement can be done by the following ways: 1) Advance payment. 2) Open account. 3) Bill on collection basis. 4) Follow up of overdue bills (when the terms are not under LC). 5) Documentary credit

Advance payment: When the buyers credit is doubtful or the seller wants the payment before dispatching the goods then he asks for the advance payment where the money is paid before taking the ownership of the goods. Open account: By an agreement between buyer and the seller manufactured goods will be delivered to the buyer directly or to his order and the buyer will pay at the end of the agreed period. Bill on collection basis: It is an agreement by which the seller after shipping the goods submits the documents to his bank as agent for collection. Bill of exchange may be defined as an order given by the exporter to the importer to pay the amount of sale value mentioned in it. It is sent along with the other documents by the exporter bank within 21 days of shipment of the goods (if the documents are under LC term then the bank may deny to make the payment to the exporters bank if the documents are received after 21 days, since it will treat it as a discrepancy. Once discrepancies have been found the exporter will get the amount only if the importer wishes. The issuing bank has 20

no obligation in the case where any discrepancy is found) to the importer bank so that he can give it to importer. Bill of exchange is first among all the documents given to the importer and when importer makes the payment then only he is entitled to receive other documents with the help of which he can release his goods from the dock. Bill of exchange is of two types: 1. Sight bill 2. Usance bill When sight bill is presented to the importer he has to make the payment immediately to the exporter within a period of 7 days. At maximum 3 more days are given to him if he is unable to make the payment within 7 days. This method of payment is called D/P documents against payment. When agreement between exporter and importer provides for credit to be extended by the exporter for a certain period of time, a usance bill is prepared. It ranges between 10 days to 179 days. In such a case the method of payment is called D/A documents against acceptance. The bill of exchange is thus kept with the importers bank and is presented to the importer at the time of payment. Follow up of overdue bills (when the terms are not under LC): It is the duty of the importers bank that if the payment by the importer is not made to the exporter after the due date then he must return the documents back to the exporters bank within 180 days so that the exporters bank can crystallize the bill. If importers bank has not send the documents after 180 days then the exporter reports this to RBI(in case if the exporter is in India).RBI then prepares a list of defaulters. It will also make necessary adjustments in the balance of payments. When exporter gets his documents back he will call his goods also back to him. After this no transaction is possible. In such a case exporter has to look for alternate buyer.

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Documentary credit: It provides complete financial security to the seller of the goods. Once a letter of credit is established by the buyers bank on the behalf of the buyer in favor of the seller and the seller submits the set of required documents to the opening bank or to the nominated bank seller is assured of the payment.

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EXTERNAL TRADE FINANCE SERVICES PROVIDED BY HDFC BANK

Training is everything. The peach was once a bitter almond; cauliflower is nothing but a cabbage with a college education.Mark Twain

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EXTERNAL TRADE FINANCE SERVISES PROVIDED BY HDFC BANK:

We can discuss the Trade finance services provided by HDFC Bank into 4 parts: 1. Import of goods and services including letter of credit and bank guarantee 2. Export of goods and services 3. Inward remittance 4. Outward remittance

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IMPORT OF GOODS AND SERVICES

Import of Goods and Services into India is being allowed in terms of Section 5 of the Foreign Exchange Management Act 1999 (42 of 1999), read with Notification No. GSR 381(E) dated May 3, 2000 as amended from time to time.

IMPORT TRADE

INTRODUCTION
The Directorate General of Foreign Trade (DGFT) under Ministry of Commerce & Industry, Department of Commerce, and Government of India regulates import trade. Authorized dealers, while undertaking import transactions, should ensure that the imports into India are in conformity with the Export Import Policy in force and Foreign Exchange Management (Current Account Transactions) Rules, 2000 framed by Government of India vide Notification No. G.S.R.381 (E) dated May 3, 2000 and the directions issued by Reserve Bank under Foreign Exchange Management Act from time to time. Authorized dealers should follow normal banking procedures and adhere to the provisions of Uniform Customs and Practices for Documentary Credits (UCPDC), etc. while opening letters of credit for import into India on behalf of their constituents.

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 IMPORT OF GOODS
General: -- Rules and Regulations from the Exchange Control angle to be followed by the authorized dealers while undertaking import payment transactions on behalf of their clients are set out in the following paragraphs. Where specific regulations do not exist, authorized dealers may be governed by normal trade practices. Authorized dealers may particularly note to adhere to "Know Your Customer" (KYC) guidelines issued by Reserve Bank (Department of Banking Operations & Development) in all their dealings.

Form A 1: -- Applications by persons, firms and companies for making payments, exceeding USD 500 or its equivalent, towards imports into India must be made on appropriate form A 1.

Import Licenses: -- Authorized dealers may freely open Letters of credit and allow remittances for import of goods unless they are included in the negative list requiring license under the EXIM Policy in force. In such cases, licenses marked For Exchange Control purposes should be called for and special conditions, if any, attached to such licenses adhered to Exchange Control copy of the import license submitted by importer for opening of Letter of Credit or making remittance, when fully utilized, should be retained by authorized dealers and may be preserved till its scrutiny by the internal auditors or inspectors is completed.

Interest on Import Bills: -- Authorized dealers may allow payment of interest on usance bills or overdue interest for a period of less than three years from the date of shipment at the rates prescribed in the Master Circular on trade credits.

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INTERNATIONAL TRADE:
DOCUMENTRY CREDITS: STAGES OF DOCUMENTARY CREDIT:

STAGE 1. Buyer and Seller arrive at a contract for sale, specifying the terms of sale. Both the parties may not know the financial capacity of each other. As for the Seller is concerned he may prefer a bank should undertake the payment obligation of the buyer and payment should be made available to him immediately on dispatch of on the goods from his country. On the basis of this agreement Buyer (Applicant) requests his bank (issuing Bank) for undertaking the payment obligation on his behalf in favor of the Seller (beneficiary). The arrangement, under which a bank on behalf of the buyer (importer) undertakes the payment on behalf of certain documentary conditions, is known as Documentary Credit. As per the requirement of the contract and on the basis of the application given by the applicant, issuing Bank establishes the Letter of Credit and forwards the Letter of Credit to its Correspondent Bank (Advising Bank) in the Sellers country, which advises the Letter of Credit to the Beneficiary. At times, at the insistence of the Seller, Buyer requests Issuing Bank to make suitable arrangement with a bank in the Sellers country for releasing payment immediately to the Seller on submission of shipping documents per Sellers requirement. In such cases, the issuing Bank requests a bank in the Sellers country or in any third country, to undertake the payment obligation on their behalf under this transaction. A bank in the Sellers country may agree for this arrangement subject to their Correspondent relationship with the Opening Bank.

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STAGE 2: The beneficiary after shipping the goods will good will present the documents to his bank (Negotiating Bank) or he may have a choice of presenting the documents to the confirming bank directly. On receipt of the documents, the Negotiating Bank / Confirming bank will scrutinize it thoroughly and pay value to the exporter/beneficiary of the LC against the shipping documents. They will claim reimbursement from the bank notified by the issuing bank in the letter of credit. Simultaneously, negotiating bank will forward the documents to the issuing bank, which will hand over the document to the applicant after recovering the bill value. Applicant/importer will accept/pay for the bills if the documents are as per requirement.

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IMPORT LETTER OF CREDIT

Parties to a letter of credit transaction:

Applicant: -- The applicant should give a precise detail for the opening of the letter of credit. The applicant should indemnify banks against rules and regulations imposed by the foreign countries. (Article 5 & 18) Beneficiary: -- The beneficiary in whose favour the credit is established can in no case avail himself of the contractual relationship existing between the banks or between the applicant for the credit and the issuing bank. (Article 3) Issuing bank: -- The issuing bank gives a conditional undertaking and reimburses the negotiating bank against submission of the prescribed 29

documents. It should verify the documents presented under the credit within 7 banking days following the day of receipt of the documents and if any discrepancy is found it will refuse reimbursement. Advising bank: -- The bank advising the letter of credit acts without any engagement on its part but will take reasonable care to check the authenticity of the Credit. If incomplete or unclear instructions are received, it will give the preliminary information to the Beneficiary without any responsibility on its part. (Article 7, 12) Confirming Bank: -- When the confirmation to a credit is added by a confirming bank at the specific request of the opening bank it constitutes a definite, equitable undertaking on the part of the Confirming Back in addition to the Opening Back, provided the stipulated documents are presented in accordance with the terms and conditions of the Credit with in the due date. (Article 9 & 13) Negotiating Bank: -- The nomination of a bank by the opening bank for negotiation of documents under a credit does not constitute any undertaking on the nominated bank unless the credit is confirmed by it. Negotiating bank may be the bank of the beneficiary of the credit and / or a bank, which pays value against a set of documents drawn under a credit. Issuing bank will reimburse the nominated bank if it has negotiated the documents as per the letter of credit terms. (Article 9&10)

Reimbursing bank: -- Reimbursing bank will reimburse the claim made by the negotiating bank or by any claiming bank under a documentary credit under the authority of the opening bank. It need not insist for submission of any certificate of compliance from the negotiating bank along with their claim if it was not specifically insisted in the credit. Issuing bank will have prior arrangement or provide sufficient funds with the reimbursing bank for honoring the reimbursing claim as and when it is made. (Article19)

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Types of documentary credit:

a) Revocable- irrevocable credit A revocable letter of credit may be amended or cancelled at any moment without the prior notice to the beneficiary. Irrevocable credit has to be amended or cancelled with the consent of Applicant and Beneficiary. b) Confirmed credit: When a bank in the exporters country has added its confirmation by way of an additional undertaking to make payment at the specific request of the issuing bank, it becomes a confirmed credit (article 9). c) Back to back credit: In the case where exporter is not the actual manufacturer and he gets his work done by the sub - suppliers and if the sub suppliers demand letter of credit in their favour, the exporter approaches his banker to establish second set of letters of credit on the basis of export letter of credit received by him. The second set of credit opened by the bank at the request of the exporter is known as back to back credit.

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Application for letter of credit:

Application for the letter of credit requires the following information: 1. Revocable/irrevocable 2. Without recourse 3. Amount (state currency) 4. By cable/ airmail/swift 5. Beneficiarys full name and address 6. Merchandise 7. Shipment by steamer/post-parcel/airfreight 8. Country of origin 9. Usance of draft 10. Freight prepaid/paid at destination 11. Insurance by beneficiaries/covered here 12. Part shipment/permitted /prohibited 13. Transshipments permitted/prohibited 14. Shipment from shipment to. 15. Latest date of shipment 16. Latest date of presentation of documents 17. Documents must be presented for negotiation withindays from shipment date 18. License no. 19. Import permitted under pare noExim policy 2002-07 20. We confirm described merchandise can be imported against above mentioned license /Para of foreign trade policy 2004-09 (OGL) 21. Special instructions, if any

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Documents under the letter of credit

Draft: The beneficiary should draw it as per the tenor stipulated in the letter of credit. It should be drawn either on the issuing bank or on the confirming bank or on the nominated bank as per the stipulations of the documentary credit. It should indicate the LC no. and the name of the bank. Packing list: It contains buyers name, items, dimensions, weight (gross and net both) of the goods, the quantity which is to be delivered. Certificate of origin: The goods, value, shipper, bill of lading number etc. should be verified of their originality. This should be issued by the chamber of commerce or any other authority as indicated in the letter of credit. (Article 21) Work test certificate: It certifies that the goods are well tested of their function as per the demand of the buyer. Certificate of warranty: It certifies regarding the warranty period of the goods. Purchase order: It is the very first document between both the parties. It contains the details regarding the goods required to be purchased. Certificate of compliance It certifies that the terms of the purchase order has been well taken care of 33

regarding well functioning of the goods and quickly dispatched. Commercial invoice: a. The beneficiary as mentioned in the letter of credit should draw the invoice. b. It should be drawn in the name of the opener of the credit. c. The description of the merchandise should be exactly in agreement with that mentioned in the letter of credit. d. The reference number of the letter of credit and the bank, which has opened, should be mentioned in the invoice. e. The invoice value should not exceed the value of letter of credit. f. Terms of the contract such as CIF, CFR, and FOB should be clearly indicated in the invoice as mentioned in the credit. g. Other particulars such as bill of lading, shipping marks, Import License number, gross weight, net weight etc. h. The invoice should conform to article 37 of the UCPDC. Bill of lading: a. b. c. d. e. The bill of lading should be in sets with the number of non-negotiable copies as stipulated in the letter of credit. The shipping company or its authorized agents should sign on it. It should be marked clean and should not have any indication to the defective conditions of packages or goods, etc. The description of the goods should be as per the letter of credit requirement and should agree with the description in the invoice. The letter of credit should call for shipped on board bill of lading. Bill of lading should evidence goods having being loaded on the vessel and also the date on which it was loaded. f. Freight prepaid or freight to be paid at destination should be clearly indicated in the bill of lading as per the letter of credit terms (article 33).

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CHARGES BY HDFC BANK:

For import letter of credit: Commitment charges for the full validity of the credit Usance charges according to the tenor In the case of LC established with 100% cash margin charges may be fixed by the banks at their discretion irrespective of the value of the credit. In the case of extension of the validity period of credit, if it falls within a 3 months period for which commitment charges has already been recovered, a minimum amendment commission will be recovered. Any amendment to a letter of credit other than extension of the validity of its value, minimum commission will be charged.
HDFC BANK LTD Particulars Amounts in INR Commission Exports Bills: Courier Swift

Collections Negotiations Bank Realization Certificates Extra Reminder Swifts collections / negotiations Bills Returned unpaid* Late Payment Extension Write Off Grant of Loans Extension of Loans GR Approval letters Realization from other banks for

0.0625% or min 750 0.015% or min.1000 150 750 Actual or 500, whichever is higher Per quarter 250 750 750 Processing applicable) NIL 500 0.0625% or min 750 fees (where ever

1000 1000 1000 -

500 500 -

* Actual if the overseas bank charge HDFC Bank

Import Bills:

Direct Bills Collections

0.125% or min 750 0.25% or min 750

500 500

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Negotiations (Bills Recd under our 0.15% or Min.1000 LC) Bills under local LC Discrepancy fee * Bills returned unpaid 1000 USD 25/500

1000

500 500

(* Also claim USD 150/- from the corresponding bank who originated the transaction)

Issuance of LC:

Issuance of Import LC Amendment of an Import LC Documentation Fee

Guarantee Issuance

Fedai or Min. 1000 Fedai or Min. 500 1000 if applicable

1500 500 -

Financial

Issuance Amendment Extension / Enhancement /

1.8% p.a. or min 500 *1.8% p.a. or min 500 1000

Performance

Documentation Fee

Issuance Amendment Shipping Guarantee Documentation Fee

Miscellaneous Outward Remittance

1.8% p.a. or min 500 *1.8% p.a. or min 500 500 1000

Miscellaneous Remittance

Outward

0.15%, min 500

250

nds Transfer charges

Remittances up to Rs.50,000/- per day FREE Above Rs. 50,000/- per day - Rs. 0.40 per Rs.1,000/- or part thereof of the entire amount

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International Debit Card

Annual Fee: Issuance Charge: Rs. 100/-

Rs.

100/-

Transactions VISA/PLUS locations in India

on Cash Withdrawal: 5 transactions FREE per month ATM 6th transaction onwardsRs. 20/Balance Enquiry: FREE

Transactions on other bank Cash Withdrawal: ATM at international Balance Enquiry: Rs. 15/locations Minimum (Average Balance)

Rs.

110/-

Balance Option 1: Rs. 10,000 (Urban), Rs. 5000 (Semi-Urban) Quarterly Option 2: NIL with a Fixed deposit of Rs. 50,000

Charges on maintenance thereof

non

Option 1: Rs. 750 per quarter (Urban and Semi-urban) Option 2: Rs. 750 per quarter (Urban and Semi-urban, in case of non-maintenance of Rs. 50,000 Fixed Deposit) Free Rs. 5 per leaf on non-maintenance of Average Quarterly Balance

Cheque book

Payable at par Cheque book No Charges Account Statements Monthly statements free

Rs.100 at Branch, Rs.50 per statement through Phone Banking (Non-IVR) & Issue of duplicate / adhoc ATM, statements Rs.30 per statement through Net Banking, Phone Banking (IVR) & Mobile Banking Hold Statement Rs. 400 per year

Managers Cheques/Demand DD request through Branch Drafts-issued-On HDFC Upto Rs. 50,000: Rs. 75 (Rs. 30 through Phone banking) Bank Locations **Only DD amount upto Rs 100,000 for Preferred & Rs 50,000 for other customers accepted at Phone banking Above Rs. 50,000 & up to Rs. 1 Lakh: Rs. 2.50 per 1000 or part thereof (Min Rs. 150) Above Rs. 1 Lakh: Rs. 2 per 1000 or part thereof (Min Rs. 250 & Max Rs. 5000) o DD request through Net banking-Free Upto Rs. 1 Lakh: Rs. 30

37

Third party DD* up to Rs. 1 Lakh: Rs .30+(corresponding Bank charges if applicable) (*Third Party Registration required. Customers registered for Third Party Transfers have a maximum limit of Rs. 5 Lakh per customer ID and hence can issue multiple DDs of Rs. 1 Lakh up to Rs. 5 Lakh and send it to the beneficiary address) Managers Cheque/Demand Drafts - Cancellation / Rs. 50 Revalidation Rs. 50 plus charges as outlined below: Upto Rs. 500: Rs. 10 Above Rs. 500 to Rs. 1000: Rs. 15 Above Rs. 1000 to Rs. 5000: Rs. 25 Demand Drafts- Issued - On Above Rs. 5000 to Rs. 10,000: Rs. 30 Non HDFC Bank Locations Above Rs. 10,000 to Rs. 1 Lakh: Rs. 3 per 1000 or part thereof Above Rs. 1 Lakh: Rs. 6 per 1000 or part thereof (Min Rs. 300) Cheque Collection - Local Free Clearing Zone Collection of outstation Up to Rs 10,000: cheques - our Bank Rs. 10,000/- to Rs. 1,00,000/locations Rs. 1,00,001/- and above: Rs. 150/Rs. Rs. 50/100/-

Up to Rs 10,000: Rs. Collection of outstation Rs. 10,000/to Rs. 1,00,000/-: Rs. cheques - other locations Rs. 1,00,001/- and above: Rs. 150/-

50/100/-

Due to insufficient funds Rs. 350 Cheque return charges Due to technical reasons No charge drawn on us - Local Rs. 400 on non-maintenance of Average Quarterly Balance Cheque return charges drawn on us deposited in Rs. 75 other locations Cheques outward deposited - Rs. 50 Rs. 100 on non-maintenance of Average Quarterly Balance

38

Balance Branch

Enquiry

at

Free

Balance Certificate

Current Previous year: Rs. 250

year:

Free

Balance Certificate from Rs. 250 overseas rep office Interest Certificate TDS Certificate Rs. 50 Free Up to 14 days: No 15 days up to 6 months: Above 6 months: No charge Rs. 50 Rs. 50 charge 100/-

Account Closure

Rs

Photo Attestation Signature Attestation

Signature attestation from Rs. 250 overseas Rep office Address Confirmation Rs. 50 Particular Cheque: Rs. 50 (Free through Phone Banking) Range of Cheques: Rs. 100 (Free through Phone Banking) Rs. 25 Setting up Rs. 150, Rs. 25 per transaction plus remittance charge Rs. 100 per occasion + 18% interest p.a.

Stop Payment Charges

Cheque status per instance

Standing Instructions

Unarranged overdraft

Cash Delivery (in select Rs. 50 per delivery subject to max value of Rs. 1 Lakh cities) Old records/copy of paid Up to 1 year Rs. 50 per record

39

cheques Activation account of dormant

Above 1 year - Rs. 100 per record

No Charges

Branch transactions

Free 3 free in the quarter & Rs. 60 per additional transaction on non-maintenance of Average Quarterly Balance (cash deposit/withdrawal)

Inter branch transactions through teller counters - Free Funds Transfer Inter branch transactions Cash transactions up to Rs. 50,000: Free per month through teller counters Above Rs. 50,000: Rs. 2.90 per 1000 on the full amount Local cheque deposited for No charge outstation accounts Phone banking IVR Free Free Rs. 50 per call on non-maintenance of Average Quarterly Balance for transactions that are available on IVR but are done through the Phone Banking executive Free

Phone banking - Non IVR

ATM Card

ATM Card - Replacement Rs. 100 (Plus taxes) charges Balance enquiry Free Cash withdrawal: 5 free cash withdrawal transaction per ATM Card - Transaction month at Non-HDFC Bank ATM charge for Partner banks Additional transaction done at Non-HDFC Bank ATM: Rs SBI & Andhra bank 20/- per transaction (Per transaction limit will be Rs 10,000/-) ATM Card - Transaction charge for Non-Partner NA banks

40

Regular: Rs. 100 per year (waived for first year) Debit Card (NRE Account) Gold: Rs. 500 per year (plus taxes) Annual Fee Women's Card: Rs. 100 per year (plus taxes ) Regular: Rs. 100 per year ( plus taxes Gold: Rs. 500 per year ( plus taxes Women's Card: Rs. 100 per year ( plus taxes ) ) )

Debit Card Renewal Fee

Replacement of a damaged card: No charges Debit Card - Replacement Replacement of a lost card - Rs. 100 (plus taxes) (for all card charges types) Debit Card - Transaction Charge - HDFC Bank Free ATMs Balance enquiry: Free Debit Card - Transaction Cash withdrawal: 5 free cash withdrawal transaction per Charge - Non HDFC Bank month at Non-HDFC Bank ATM Domestic ATMs Additional transaction done at Non-HDFC Bank ATM: Rs 20/- per transaction (Per transaction limit will be Rs 10,000/) Debit Card - Transaction Rs. 15 per Charge - Non HDFC Bank Rs. 110 per cash withdrawal International ATMs PIN regeneration charge Rs. 25 (plus taxes) Rs. 25 per transaction (plus taxes) for transactions declined at other Bank ATMs anywhere in the world or at a Merchant outlet outside India Regular: Rs. 100 per year (plus taxes), One add-on card free for the first year Gold: Rs. 500 per year (plus taxes) Womens Card: Rs. 100 per year (plus taxes) Rs. 25 (plus taxes) per quarter per Customer ID Rs. 10 (plus taxes) per transaction (Email alerts

balance

enquiry

Decline charge insufficient balance

for

Add-on Debit Card -

Bill Pay InstaPay InstaAlert only)

Free

41

Visa Money Transfer NEFT Charges Inward

Rs. 20 (plus taxes) per transaction NIL

Up to Rs. 1 Lakh: Rs. 5 (inclusive of taxes) per transaction NEFT Charges- outward Rs. 1 Lakh and above: Rs. 25 (inclusive of taxes) per through Net Banking transaction Customers having NSBL*A/c: Rs 20/NEFT Charges for Indo- Customers having Non-NSBL* A/c: Up to Rs 5,000 - Rs Nepal transactions 70/Above Rs 5,000 - Rs 95/- * Nepal State Bank Ltd Through Net Banking: Rs. 25 (inclusive of taxes) per transaction NIL Free Free Return

RTGS - Outward

RTGS - Inward Mobile Banking Net Banking ECS (Debit) Charges

Rs 200 (plus taxes)

* As per the Finance Bill 2009, all fees and charges mentioned above will attract Service Tax @ 10% and Education Cess @ 3% of the service tax amount effective 24th Feb 2009.

42

EXPORT OF GOODS AND SERVICES

INTRODUCTION: As far as export is concerned the bank provides export finance to the exporting country as and when required. Export finance is a short term, working capital finance allowed to an exporter. Funds should be available to the exporter at the required time.

43

TYPES OF EXPORT FINANCE:

A. PRE-SHIPMENT FINANCE
It helps in financial assistance for the execution of an export order from the date of receipt of an export order till the date of shipment It is a type of loan or advance granted to an exporter for financing the purchase, processing or packing of goods on the basis of confirmed and irrevocable order or any other evidence including Letter of Credit.

44

Types of pre-shipment finance

1) packing credit: Follow up of packing Credit Advances: a) Submission of Stock Statement: Exporter should submit stock statement reporting the stocks, which are under pledge or hypothecation to the bank for securing the Packing Credit Advance. Frequency of submission of stock statement must be decided by the Authorized Dealer at the time of sanctioning the packing Credit and should be adhered to, by the exporter. b) Physical inspection of stocks: Stocks pledged/hypothecated by the exporter must be duly inspected by the Authorized Dealer at regular interval Liquidation of Packing Credit advances: Packing credit advance will always be liquidated with the export proceeds of the relevant shipment. At this stage the pre-shipment liability of the exporter will be converted into post shipment liability. For any reasons, if export does not take place at all, the entire advance will be recovered at commercial rate penal interest as decided by the banks. With the recent liberalization and deregulation of interest rates, banks will have operational flexibility for liquidating packing credit advances as per RBIs guidelines issued with effect from 14.12.1994. Criteria to be applied for allowing above relaxation: Even though Reserve Back has now permitted the above relaxation for liquidating a Packing credit advance, each Bank has got their own conditions to extend this facility to the exporter-customer. In general, the following conditions are observed while extending this facility to the exporter: Bank should ensure that substitution is commercially necessary and unavoidable. The sanctioning authority must also satisfy him about the valid reasons as to why packing credit extended for shipment of a particular commodity cannot be liquidated in the normal. It is suggested that as far 45

possible, the substitution of contract should be allowed if the exporter maintains account with the same bank or it has the approval of the members of the consortium. Overdue Packing Credits and ECGC procedures: If the borrower fails to pay the amount on due date / extended due date and bank considers it as overdue, an overdue report of advance should be made to concerned Regional / Branch office of ECGC in prescribed form within 30 days. If the overdue position persists, back should take necessary steps to realize dues as per its usual recovery procedure and the default to ECGC. This default report should be sent to concerned Regional / Branch office of ECGC in prescribed form within one month from date of recalling the advance or within 4 month from date / extended due date of the loan amount whichever is earlier. Payment of ECGC premium may be discontinued after the month in which the default is reported to the month in which insolvency of the exporter is reported ECGC. Back should recover the overdue by liquidating the securities, if any, available. Nursing programe can be initiated, if found feasible, with the consent of ECGC. If recovery is not possible, bank can prefer Claim under the WTPC Guarantee within 6 months from the date of report of default.

Pre-shipment credit in foreign currency (PCFC) PCFC was introduced on 8 November 1993.

FEATURES: All convertible currencies Similar terms and conditions like P/C-L/C or Order Running Account also available Only for cash exports

46

Banks may source the funds either by using the offshore funds available with them such as balances in EEFC /RFC/ ESCROW accounts

Source of funds -Any foreign currency funds Prior permission of RBI not required Liquidated by discounting of bills under rediscounting of Export Bills abroad SELFLIQUIDATING. Cost of borrowing abroad not to exceed1% over LIBOR by the Banks (Competitive international rates). Exporters at a cost not exceeding 2% over the appropriate LIBOR excluding the holding tax by Banks having Overseas Branches and 2.5%by other banks.

Normally for 180 days. If no export within 360 days PCFC adjusted at TT selling rate for currency concerned - Interest will be charged at appropriate rates on rupee equivalent of the principal amount at ECNOS (plus a penal rate as per banks discretion).

Running account facility can be given. Forward Contracts can be booked for future drawls account facility. It would be in order for banks to liquidate PCFC granted to a Diamond Dollar account holder by dollar proceeds from sale of cut and polished diamonds to another DDA holder.

Diamond Dollar Accounts can be maintained by Firms/ Cos. With a track record of at least three years and having an average annual turnover of Rs.5 corers or above during the preceding three licensing years.

Running Account facilities Effective 14 March 1992, banks can grant pre-shipment advances for exports of any commodity, without prior lodgment of L/C, export orders under Running Account. 47

Conditions for Running Account Need-based facility Exporters with good track record L/Cs firm orders can be produced within reasonable time (for products under SCC L/Cs firm orders to be produced within one month Exporters in EOUs, EPZs and SEZs also eligible

B. POST SHIPMENT FINANCE

It is an advance against receivables which is in the form of shipping documents. If the bank has given the pre-shipment credit to the bank then he cannot deny the post-shipment credit, if asked. Types of post-shipment finance: 1. Export bills purchased/negotiated/discounted: The risk of nonpayment is there if letter of credit is not there. The risk is more pronounced if documents are under acceptance. In order to safeguard the interest of the bank and also the exporter, ECGC offers coverage of credit risks through their guarantees/policies at the post-shipment stage. The general banks cover the advance under the Whole Turnover Post Shipment Guarantee scheme. But the HDFC Bank never trusts the ECGC. In addition to this the exporter is advised to go for separate buyer wise policy also. 2. Export bills negotiated: All the documents presented to the bank for negotiation should be strictly in accordance with the L/C terms. Even the slightest deviation from those terms and conditions specified in the L/C can give an excuse to the issuing bank for non-payment. 3. Advances against bills sent on collection basis: In some cases the exporter himself may requests for sending the bills for collection basis. Bank may allow advance against these collection bills to an exporter. 48

Concessive rate of interest is charged for this advance from the exporter according to the period. 4. Advances against exports on consignment basis: Goods are exported on consignment basis at the risk of the exporter. Eventual remittance of sale proceeds will be made by agent. The overseas branch of the bank will be instructed to deliver the documents against trust receipt. 5. Advances against indrawn balances: In certain line of trade it is the practice of the exporter to leave a part of the amount as undrawn balance. Authorized dealers can handle such bills provided the undrawn balance is inconformity with the normal level of balance left undrawn in the particular line of export trade subject to a maximum of 10% of the full export value. Advances against undrawn balance can be made at a concession rate of interest for a maximum period of 90 days. 6. Advances against duty drawback: Where the domestic cost of production of certain goods is higher in relation to international price, the exporter may get support from the government so that he may compete effectively in the overseas market. The government of India and other agencies provides export incentives under the export promotion scheme. This can only be in the form of refund of excise and customs known as duty drawback. Bank grants advances to exporter against their entitlements under above category at low interest rate for a maximum period of 90 days. GENERAL GUIDELINES OF THE BANK FOR SANCTIONING EXPORT FINANCE TO CUSTOMERS: 1. Banks should meet the genuine credit requirements of the export sector promptly and in full. They should review their internal arrangements and take such action as is necessary, including delegating enough powers to Branch Managers/Regional Managers to export sector. 49

Queries should not be raised in piecemeal or information sought at various stages, leading to delays in extending credit. 2. Bank may adopt a flexible attitude with regard to debt equity ratio; margin and security norms but there could be no compromise in respect of viability of the proposal and the integrity of the borrower. 3. Exporters should be able to satisfy their banker about their capacity to execute the orders within the stipulated time and have proper expertise to manage the export business. 4. The quantum of finance sought should commensurate with the expected export turnover and the cost of inputs required. 5. If the exports will be covered under letters of credits, banks would need to be satisfied about the standing of the credit opening bank and also the acceptability of the conditions specified in the credit. 6. Where exports are not covered by Letters of Credit and will be on the basis of firm contracts, banks may insist for obtaining a satisfactory status report on the overseas buyer.

50

EXPORT PROCESS: 1. Exporter gets the export order. 2. He demands letter of credit or bank guarantee if he has any doubt regarding the credibility of the importer. 3. The exporter sends 3 copies of GR form to the custom authority. Custom keeps 1 copy with itself, 1 copy is returned to the exporter and 1 copy is sent to RBI. 4. He prepares the goods and takes it to the dock for shipment. 5. He prepares the bill of lading if he is sending the goods through ship. In such a case he sends the documents (packing list, invoice, bill of exchange, original bill of lading, certificate of origin, work test certificate, purchase order etc) to his bank which sends the documents to importers bank. The documents should be sent within 21days of shipment of goods. 6. The copy which is received by him by the custom is sent to the bank, the bank then sends the copy to the RBI again to tally both the copies of GR

51

BANK GUARANTEE:
The term bank guarantee can be defined as: a guarantee given by a bank to a third person, to pay him a certain sum on behalf of the banks customer, on the customer failing to fulfill any contractual or legal obligations towards the third person. Various types of bank guarantees: 1. Financial guarantee: These are the guarantee issued by bank on behalf of the customers, in lieu of the customer being required to deposit cash security or earnest money. These kinds of guarantees are mostly issued on behalf of customers dealing with government departments. If the contractor does not fulfill his obligation then the government department invokes the guarantee and collects the money from the bank. 2. Performance guarantee: These are the guarantees issued by the bank on behalf of its customer whereby the bank assures a third party that the customer will perform the contract entered into by the customer as per the condition stipulated in the contract, failing which the bank will compensate the third party up to the amount specified in the guarantee. Banks obligation to pay primary Bank guarantees are called the life blood of international commerce and even though they are an off shoot of a primary contract between the debtor and the creditor, these guarantees are independent commitments taken by bank on behalf of the customers. The obligation of the bank is irrespective of the disputes between the beneficiary and the debtor.

52

PRECAUTIONS WHICH BANK TAKES WHILE ISSUANCE OF BANK GUARANTEE: The banks criteria taken into consideration while issuance of bank guarantee on the following basis: 1) Amount guaranteed: when the bank issues a guarantee, first and the foremost consideration that it takes is the amount he is called upon to issue. In the guarantee agreement the amount has to be specifically stated both in figures and words. Care should be taken to state whether the amount is inclusive of all interest, charges, taxes and other levies. This is important to avoid unnecessary disputes regarding the liability of the bank. 2) Period of guarantee: Bank always specifies the period for which their guarantee subsists and an additional period during which a claim has to be made on the bank to make payment. The former period during which the guarantee subsists is called the validity period and the latter the claim period. If any default has been committed by the debtor (i.e. the banks customer) it should be within the validity period. It is thus necessary as a matter of great caution that this period e specified to the exact date. Once this outer limit for the bank to guarantee default of the debtor is fixed then the creditor can make a claim only if the default has occurred within this period, an for any default beyond this date the bank cannot be held liable. Claim period in a guarantee: in a guarantee it is necessary to provide for a period slight longer than the validity period for the beneficiary to make a claim. The claim period is usually a few months more than the validity period of the guarantee.

53

3. Counter guarantee and other security: Though a bank guarantee is a contingent liability it is always prudent for a banker to secure this contingent liability in case it is enforced. This can be done by obtaining a counter guarantee cum-indemnity executed by the customer in favour of the bank.

54

( Annexure 1) Process at the Retail Branch for Issuing BG with 100% Cash Margin
Customer approaches the Branch Manager (BM) for the facility

BM checks the facility required approves it, if within his limit of 25 lacs or else

Seeks approval from the relevant authority

The Performa BG given by the beneficiary is sent to TF desk by fax or email for approval.

Branch to obtain all the documents as per the checklist and circular

FD for 100% Cash Margin In case of non existing FD a) Branch to debit customers a/c & park in branch dummy a/c b) Mail to CPU & TF a. to book FD & mark a lien mentioning the branch dummy a/c no. b. Confirm the obtention of docs from customer with BG details with a request to release BG limit. In case of existing FD

a) Mail to CPU & TF a. To mark a lien mentioning the FD details. b. Confirm the obtention of docs from customer with BG details with a request to release BG limit

After receiving approval mail from TF with BG No, a) Two staff members of the Branch having POAs will sign the BG on the stamp paper. b) If Branch has only one POA, then the BM can get the signature of another POA from the nearest branch/ TBG desk which ever is closer c) Due to any reason, POA/s are not available in the branch or in the nearby branch, the branch should get the Bank Guarantee signed by 2 POAs from the TF Desk itself, by informing the TF desk about the same.

The original docs and copy of the BG to be forwarded to TF desk under ROD

55

INWARD REMITTANCE AND OUTWARD REMITTANCE IN TRADE HDFC BANK

OUTWARD REMITTANCE:
It is the way in which money from a country goes to another country in some other way than export or import of goods. Outward Remittances (Miscellaneous) for other purposes can be remitted with ease. Remittances by way of DD / TT / Swift can be affected through banks strong network of correspondent banks to any part of the world. All transactions are subjected to FEMA regulations. Outward Remittance (Miscellaneous) List

BTQ / Business Travel / Gift Remittances / Medical Treatment / Student Remittances / Donations / Immigration / Employment Abroad / Maintenance of Family / Subscription fees / Examination fees of Foreign Universities / Repatriation of all NRI accounts of Individual customers / Exhibition Fee / Conference Invitation / Credit Card Payments / Subscription of Magazines and periodicals / Repatriation of sale proceeds of property / Repatriation from NRO a/c / Repatriation of funds relating to OCB / Repatriation under the Liberalized remittance scheme of USD 25,000/- per calendar year for Resident Individuals.

56

INWARD REMITTANCE:
GENERAL: Foreign exchange due or accrued as remuneration for services rendered in or outside India, or in the settlement of any lawful obligation, or an income on asset held outside India, or as inheritance, settlement or gift is to be sold to an authorized person within 7 days from the date of receipts. FOREIGN (FIRPS): Foreign exchange dealers association of India (FEDAI) has evolved FIRPS to facilitate quick transmission of funds to beneficiaries in India against inward remittance received from abroad through banking channels in rupees as well as in foreign currency. ISSUE OF BANK CERTIFICATE: Authorized Dealers should issue bank certificates against receipt of inward remittance or realization of foreign exchange on security papers if the amount exceeds Rs. 15000/- in value, bearing distinctive serial numbers and reference numbers. REMITTANCE THROUGH HDFC BANK TO OTHER BANKS (OUTWARD): Rs. 0.25/- per. 1000/- per transaction (Minimum- Rs50, Maximum- Rs.1000) REMITTANCE REMITTANCE: FREE INTO HDFC BANK ACCOUNT (INWARD INWARD REMITTANCE PAYMENT SYSTEM

57

VARIOUS TOOLS ADOPTED BY HDFC BANK TO FACILITATE INTERNATIONAL TRANSACTION

58

VARIOUS TOOLS ADOPTED BY HDFC BANK TO FACILITATE INTERNATIONAL TRANSACTIONS

HDFC Bank has adopted the following tools to facilitate the international trade: 1) Foreign Exchange. 2) Tools to avoid most common discrepancies in international trade. 3) Nostro Account

1) Foreign Exchange:
Conversion of one currency to another currency is referred to as Foreign Exchange. HDFC provide the facility to conversion of one currency into another currency. Types of Transactions: In Forex market there many ways to accomplish the transactions. 1) Cash In this case, the transaction is settled the same day. 2) Value Tomorrow (Tom) In this case, the transaction is settled on the first, succeeding working day. 3) Spot In this case, the Transaction is settled on the second succeeding working day. 4) Forward In this case, the transaction is settled After the second succeeding working day of the predetermined date with the predetermined 59

sum of money Authorized Dealers (Banks) can undertake all types of activities in FOREX/Foreign Trade e.g. Banks. Generally banks perform the intermediary task and categorized as authorized dealers.

Exchange rate quotations: It is to express the value of one currency in terms of another currency. There are two ways of quoting exchange rates: 1. Direct quote: In this case the variable currency is home currency. e.g., 1USD = Rs. 44.52 2. Indirect quote: In this case, the variable is foreign currency e.g., Rs. 100 = USD 2.2461
(oct2, 2010)

TYPES OF RATES: 1. BUYING RATE: TT buying rate:

This rate is used for transactions where there is no delay in the realization of FOREX or where the nostro account of the bank has been credited e.g. cleans inward remittance for which the nostro account has already been credited. Bill buying rate:

This rate is used for transactions where proceeds are realized at a future date e.g. purchase/ discount of bills. TC Buying rate:

This rate is used for encashment of travelers cheques. Currency buying rate: 60

This rate is used for encashment of currency notes.

2. SELLING RATE: TT selling rate:

This rate is used for transactions not involving handling of documents, e.g. outward remittance. Bill selling rate:

This rate is used for transactions involving handling of documents e.g. payment of import bills. TC selling rate:

This rate is used for issue of traveler cheques. Currency selling rate:

This rate is used for issue of currency notes.

61

2) Tools to avoid most common discrepancies in international trade

Most commonly observed discrepancies in international trade: 1. Credit expired 2. Late shipment 3. Late presentation of document 4. Documents not marled original To avoid the above-mentioned discrepancies it is the duty of the employee that he must check the documents at every stage of proceeding. HOW THE TRADE DOCUMENTS ARE CHECKED IN THE BANK? Checking documents under LC Document checking is the most critical task, as the beneficiarys payment assurance depends on documents complying with the credit. Discrepant documents are very common. It is estimated that 50% to 70% of documents are discrepant upon first presentation to the bank.

Document checking strategy Check that all required documents have been presented. Check that each document complies with the L/C Check that documents are consistent with on another.

62

Checking the bill of exchange 1. Drawer as specified on L/C. 2. Amount same in words and figures and accords with L/C. 3. Tenor of bill accords with credit. 4. Signed and endorsed by drawer. 5. Any references to credit correct. Checking the commercial invoice 1. Name and address of traders exactly as L/C. 2. Signed if required. 3. Goods description exactly as on L/C. 4. Amount accords with L/C and is exactly the same as B/E (if presented). 5. Quantity of goods and unit price accords with L/C. 6. Shipment terms as per L/C. Checking the transport document 1. Signed by named carrier or their agent. 2. Not issued by fright forwarder unless signed by them as carrier/ agent*. 3. Not charter party B/L.Clean, not claused. 4. Consignee details as per L/C, 5. B/L consigned to order and endorsed as required.If required, notify party exactly as on L/C. 6. Loading and destination ports accord with credit.

63

7. B/L evidences goods shipped on board named vessel; not on deck unless allowed. 8. Goods shipped on or before latest shipment date. 9. Transshipment only if permitted 10. Marked freight paid it required 11. Goods description and details consistent with L/C *unless specifically allowed by L/C Checking the insurance document 1. Issued and signed by insurance company, underwriter or agent. Certificates countersigned by beneficiary 2. Acceptable type (not insurance note, unless specifically allowed by L/C) 3. Not issued after shipment date unless warehouse-to-warehouse 4. Endorsed, if required 5. Amount in same currency as L/C and at least 110% of CIF/CIP invoice value* 6. All specified risks covered 7. Goods description and details consistent with L/C *unless otherwise stipulated by L/C

Checking other documents: 1. Issued by appropriate authority and, if necessary, signed by them. 2. Evidence compliance with any special L/C conditions. 3. Goods description and details consistent with the L/C.

64

3) NOSTRO ACCOUNT
Nostro account is that account of one bank, which is opened in the other foreign bank to facilitate trade, related activities. The HDC Bank has also opened its account in various foreign banks, which are as follows: SIGN CURRENCY THE CURRENCY US DOLLAR US DOLLAR US DOLLAR US DOLLAR US DOLLAR US DOLLAR EURO EURO EURO POUND STERLING POUND STERLING POUND STERLING JAPANESE YEN SINGAPORE DOLLARS GBP EUR USD J.P.MORGAN CHASE BANK BANK AMERICA BANK OF OF NEW YORK NEW YORK NEW YORK NEW YORK NEW YORK NEW YORK FRANKFURT FRANKFURT FRANKFURT LONDON LONDON OF BANK NAME PLACE

NEWYORK UNION BANK OF CALIFORNIA FIRST UNION NATIONAL BANK AMERICAN EXPRESS BANK J.P.MORGAN CHASE BANK ABN AMRO BANK AMERICAN EXPRESS BANK J.P.MORGAN CHASE BANK LLOYDS BANK ROYAL BANK OF SCOTLAND J.P.MORGAN CHASE BANK J.P.MORGAN CHASE BANK

JPY SGD

TOKYO SINGAPORE 65

SWISS FRANK SWISS KRONER AUSTRALIAN DOLLAR

CHF

UNION BANK OF SWITZERLAND NORBANKEN EMIRATES BANK INTERNATIONAL UNI BANK ANZ BANK BANK OF NOVA SCOTIA STANDARD CHARTERED

ZURICH SWEDEN, STOCKHOLM DUBAI COPENHAGEN MELBOURNE

SEK

AUD DKK

AUSTRALIAN DOLLAR CANADIAN DOLLAR HONG KONG DOLLARS

AUD

CAD HKD

HONG KONG

PROBLEMS OF THE ORGANISATION

Hdfc bank is a fast growing bank but some problems and difficulties exist in the banking sector as a whole that reduce working effectiveness and increase time consumption. 66

DEREGULATION This continuous deregulation has made the Banking market extremely competitive with greater autonomy, operational flexibility, and decontrolled interest rate and liberalized norms for foreign exchange. The deregulation of the industry coupled with decontrol in interest rates has led to entry of a number of players in the banking industry. At the same time reduced corporate credit off take thanks to sluggish economy has resulted in large number of competitors battling for the same pie. NEW RULES As a result, the market place has been redefined with new rules of the game. Banks are transforming to universal banking, adding new channels with lucrative pricing and freebees to offer. Natural fall out of this has led to a series of innovative product offerings catering to various customer segments. EFFICIENCY This in turn has made it necessary to look for efficiencies in the business. Banks need to access low cost funds and simultaneously improve the efficiency. The banks are facing pricing pressure, squeeze on spread and have to give thrust on retail assets. DEREGULATION This continuous deregulation has made the Banking market extremely competitive with greater autonomy, operational flexibility, and decontrolled interest rate and liberalized norms for foreign exchange. The deregulation of the industry coupled with decontrol in interest rates has led to entry of a number of players in the banking industry. At the same time reduced corporate credit off take thanks to sluggish economy has resulted in large number of competitors battling for the same pie.

DIFFUSED CUSTOMER LOYALTY This will definitely impact Customer preferences, as they are bound to react to 67

the value added offerings. Customers have become demanding and the loyalties are diffused. There are multiple choices; the wallet share is reduced per bank with demand on flexibility and customization. Given the relatively low switching costs; customer retention calls for customized service and hassle free, flawless service delivery MISALLIGNED MINDSET These changes are creating challenges, as employees are made to adapt to changing conditions. There is resistance to change from employees and the Seller market mindset is yet to be changed coupled with Fear of uncertainty and Control orientation. Acceptance of technology is slowly creeping in but the utilization is not maximized COMPETENCE GAP Placing the right skill at the right place will determine success. The competency gap needs to be addressed simultaneously otherwise there will be missed opportunities. The focus of people will be on doing work but not providing solutions, on escalating problems rather than solving them and on disposing customers instead of using the opportunity to cross sell.

FUTURE OF THE ORGANISATION

68

While the fundamentals of the Indian economy remain strong, the domestic equity markets and for that matter fund flows in to the domestic financial system are dependent on the Developments in the global economy and general risk appetite to a large extent. Any adverse changes therefore in the global economic or financial environment could have a negative impact on the domestic markets and the availability of foreign funds. In this regard, we see a few risks on the global front that could adversely impact the domestic markets. OUTLOOK The Indian economy is likely to continue to outperform its global counterparts in the year ahead, growing by around 8% against an average world output growth of 3.9%. Investment and capacity expansion will be a crucial link in driving the recovery forward; buoyant domestic demand should help it absorb headwinds from rising interest rates and inflation. With private capex and infrastructure spending likely to gather ground, not only will the ongoing recovery sustain into the next financial year but will also translate into greater buoyancy in credit growth and stronger growth prospects for the banking sector in general. Focus on investment in the next fiscal year is likely to render India an attractive market that is well positioned to take advantage of both structural and cyclical gains while its strong domestic base is likely to limit the impact of external stress on growth dynamics and returns.

Since the network of the bank is very strong it gives ample opportunity
to acquire new customers who may require trade finance facility.

Hdfc bank have great oportunity in tier-2 and tier-3 cities as there are
very few other private sector banks.

The recent take over of Bank of Punjab has strengthen its network and
now all branches and business of bank of panjab has been added in the kity of hdfc bank.

Most of the customers of the bank are satisfied with its services and
product which is helpful for strong goodwill of bank which increases the possibility of growing its business manifold in future.

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PART II

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OBJECTIVE
Main objective of this research is to understand importance of banking services in foreign trade. The external trade becomes important for any developing country. In international trade the role of banking industry is very important. They provide different product and services which play an important role to success of trade financing Other objectives of the research are as follows: o To understand various financial services and their activities available to the customers in HDFC Bank. o To analysis the strengths, weakness, opportunities and threats of the HDFC Bank in international trade.

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RESEARCH METHODOLOGY
RESEARCH DESIGN:
This research describes the operations of foreign exchange trade services in HDFC Bank, which is based on secondary data. Thus it is a descriptive research design. This research also carries the analysis of primary data, so it follows the analytical design. Hence, the research design is descriptive as well as analytical both

SAMPLING:
DESIGN: sampling. SAMPLE SIZE: 50 Non-probability and convenience

DATA COLLECTION:
Sources of Primary data: QUESTIONAIRE Data provided by EMPLOYEES OF BANKS Internet. Conceptual books.

Sources of Secondary data:

SWOT ANALYSIS OF THE TRADE FINANCE OPERATIONS

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THE SWOT ANYLYSIS CAN BE EXPLAINED AS

STRENGTHS WEAKNESS OPPORTUNITIES THREATS

STRENGTHS OF THE HDFC BANK1. BIGGER AND STRONG NETWORK: HDFC bank have bigger and strong network of 1725 branches and 4232 networked atm in 779 cities. This is a biggest strength of HDFC bank 2. HDFC Bank has 32 software as a whole for their various operational purposes, in which currently 22 are in use. The number of software in HDFC Bank is comparatively very high in comparison to other banks. In trade of HDFC Bank there are at least six software used: Capture Branch operation BG Professor SWIFT Alliance Flex cube corporate LSS

These software are helpful in facilitating the work of the bank and if one Software is disturbed due to some or the other reasons then other can be helpful. This will ensure the continuity of the work without disturbance. 3. Goodwill of the bank: HDFC is one of the bank which provides a familiar environment and services to customers. Various awards which have won by HDFC , also make a strong goodwill .Which make long term relation with its customer 4. There are lots of trade services provided by the bank as per the requirement of the customer. Export, import, bank guarantee, letter of 73

credit. The aim is that a trader must be able to find all the facilities of his requirement in the bank itself only then he will find a reason to come to bank again and again. This gives an image of one stop shop of the Bank. 5. Efficient employees are the assets of any company. Unless and until the employees are not efficient, the company cannot perform efficiently. The employees of the bank are efficient enough to perform the assigned task well and take the emerging challenges of the market. 6. Centralized banking facilitates smoothen and centralized flow of all the transactions related to trade. All the trade related transactions are informed to Mumbai head office before proceeding further. The head office has to know the nature and frequency and all the transactions happening at various branches. 7. The mode of payment, which is used by HDFC BANK, is not only used by this bank but it is used all over the country by all the other banks to settle international payment. Hence we can say that this mode of payment is internationally accepted and well recognized. It is the SWIFT (Society for Worldwide Inter Bank Financial Telecommunication). All the international level transactions are carried on with the help of SWIFT. This helps the bank to carry out its transactions very well within TAT. Hence, it is one of the strength of the bank, which is helping it to grow, and proving it within international standards.

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WEAKNESS OF THE HDFC BANK1. They have reduced their trade charges due to present level of competition. The competition is low in comparison to any other big city but the bank itself faces huge competition with the SBI & PNB, which is spread like grains at every part of the city. The trade charges of the other relative banks are low so HDFC Bank also needs to keep the charges low to compete well with the other banks. 2. HDFC Bank follows centralized banking due to which proper reporting has to be done to central office at each and every moment. These frequent reporting cause unnecessary delay in the workings of the bank. E.g. any nationalized bank takes half an hour to open any BG but HDFC Bank takes four hours for the same thing. 3. Lots of software are very difficult to be handled by the employees, since one employee cannot be efficient in handling all the 32 software. 4. Another weakness of HDFC is This bank use a basic software FINWARE this software is not faster technology, which reduces effectiveness of work

OPPORTUNITIES FOR THE BANK: 1. Lots of traders are still untapped whom the bank can trap. There is a great opportunity in front of the bank to trap these traders, by offering them through telecalling, e-mails or any other ways; they can be very profitable for the bank. 75

2. Regular and loyal customers can help in building goodwill and more customers. In trade also like in other business customer loyalty is very important. There are many opportunities with the bank in the form of loyal customers.

THREATS FOR THE BANK: 1. The most important threat which appears in HDFC Bank are the competitors in which the major competitors are State Bank of India, Punjab National Bank, ICICI Bank and Central Bank of India who have many branches and thats why it is more convenient for the people to approach that bank. Apart from that they have their own goodwill which is a threat for the trade of HDFC Bank. 2. Since new Private Sector Banks like UTI Bank and Kotak Mahindra Bank also provide beneficial product and services. 3. BARCLAYS is a multinational bank which have newest technology and a strong goodwill of oldest bank in world banking history. BARCLAYS is becoming a bigger competitor.

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FINDINGS

LEARN DY DOING - ANONYMOUS (PROVERB)

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FINDINGS FROM THE QUESTIONNAIRE

The clients are the very important aspect of any business transactions. On the basis of their requirements they opt for export or import. The charges by the bank also vary from customer to customer depending on their goodwill, their amount of transaction, frequency of transaction etc. In order to know more about the customers I prepared a questionnaire to extract in detail what customers felt about the services provided by the bank and how much they know about their bank. Purpose of the questionnaire: I prepared the questionnaire with the purpose of knowing the customers frequency of doing trade with HDFC Bank, their problems faced, their suggestions to the bank, how much they are aware of the trade finance and international business, how much they know about the facilities provided to them by the bank and the government, and how much they prefer HDFC Bank services in comparison to other banks. Various questions of the questionnaire and their findings after make them fill from the customers, customers opinion and what I concluded from these findings has been discussed below.

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MY FINDINGS FROM THE QUESTIONNAIRE ARE AS FOLLOWS:

TOTAL Ghaziabad: 50 Q 1). Nature of business of the trader----Sole Proprietorship/Partnership / Limited Company. The occupation of the trader is very important. It determines the nature and frequency of doing international trade. The sample size of the trader was 50 the nature of occupation can be broadly divided into 3 categories sole proprietor, partnership and the trader limited company. The following are the graphical presentation of the nature of business of the trader: NUMBER OF CUSTOMERS WHO FILLED THE

QUESTIONNAIRE AND WHO

ARE CLIENTS OF THE HDFC BANK

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Q2). What is the annual Turnover of your business? a) Below 5 lakhs c) 10 lakhs- 15 lakhs b) 5 lakhs- 10 lakhs d) above 15 lakhs

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Q 3).Apart from HDFC Bank which other bank you prefer for trade? a) SBI c) UBI e) Others b) PNB d) BARCLAYS

SBI: 9 PNB: 3 UBI: 5 BARCLAYS: 1 OTHERS: 3

Among the total customers 50, 29 customers are totally loyal to the HDFC Bank. customers do trade with other banks also along with HDFC Bank. The diagram is showing the preferences for those 21 customers only. The traders are interested in SBI in other banks. The reason being it is public bank and is located in every nook and corner of the city, its charges 82

are also lower. The second preference of the traders is UBI. It is also cheap and its location covers all the areas of the city. BARKLAYS, PNB and other banks are also preferred by some customers.

Q4). With which foreign bank do you prefer to deal with as issuing bank or beneficiary bank? a) Bank of America c) BARCLAYS b ) J .P. MORGAN CHASE d) others

10 9 8 7 6 5 4 3 2 1 0 BANK OF AMERICA BARCLAYS J.P.MORGAN BANK CHASE OTHERS Series1

J.P. MORGAN CHASE: 4 BARCLAYS: 9 BANK OF AMERICA: 8 OTHERS: 2 83

The exporter bank also plays an important role in international business. The customers prefer the above mentioned banks due to the efficient level of services provided by these foreign banks. There are minimum errors within the documents provided by these banks and services are also timely.

Q 5). In which type of trade you are involved with HDFC Bank? a) Export c) Inward remittance b) Import d) Outward remittance

TOTAL NUMBER OF EXPORTERS: 11 TOTAL NUMBER OF IMPORTERS: 23 TOTAL NUMBER OF TRADER INVOLVED IN INWARD REMITTANCE: 8 TOTAL NUMBER OF TRADER INVOLVED IN OUTWARD REMITTANCE: 8

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Among the 50 traders there are customers who sometimes do export, sometimes import and sometimes remittances depending on their nature of requirement. It cannot be hard and fast that a person can import only and cannot do other things. The above mentioned diagram shows the number of trades done by the trader which is often done and preferred by them.

Q6). What do you prefer as a customer? a) Letter of credit LC: 32 BG: 18 b) Bank Guarantee

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32 customers said they prefer LC. The letter of credit is demanded by the exporter to ensure its payment through a reliable source. 18 customers said they prefer BG, since opening BG is cheaper than opening LC in HDFC Bank.

Q7).How are the products of HDFC bank in comparison of other banks? a) More beneficial B. less beneficial

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Mostly customer replied that product of HDFC is more beneficial

87

Q8).How do you find the charges of the HDFC Bank different from the other banks? a) Expensive c) Cheaper b) equal

Majority of the customers felt that the charges are competitive and acceptable in comparison to the services provided by the bank. They are satisfied with the charges charged by the bank. The bank itself has adopted flexible approach in charges. It varies the charges according to the customers reputation, competition and other factors. It does not want to loose any genuine customer due to unfair charges.

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Q.9) How do you find service quality of HDFC bank in comparison from other bank? a) More faster b) Less faster e) Difficult to adopt Mostly customer replied that service quality of HDFC bank is faster rather than other b) Equal d) Easier to adopt

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CONCLUSION OF THE REPORT

1. SBI is the most preferred bank among PSUs banks. 2. Barclays is the next preferred bank for trade finance facilities. 3. Most of the companies using trade finance facility are exporters. 4. LC is the most favourite product among customers. 5. Most of the customer feels that the products of HDFC Bank are more beneficial than other banks. 6. However most of the customers feel that the charges are equal to other banks. 7. Most of the customers feel that services of HDFC Bank are faster and easy to adopt in comparison to other banks.

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SUGGESTIONS:
1. It should adopt new software FINCLE .Which can increase effectiveness of work and also reduce time consumption and unnecessary efforts. 2. It should concentrate on rural area. Because most of population of INDIA live in towns and villages. 3. HDFC Bank like any other Indian bank has adopted SWIFT to facilitate quick payments. It should also try other internationally acceptable modes of payment e.g. ABA, CHIPS ABA which are adopted by foreign banks abroad. 4. Now HDFC has a strong network of branches and ATMS but still now it is lesser than SBI and ICICI. This is another reason which is responsible for switching of customer. 5. The branches opened abroad will be helpful in building good relationship and brand goodwill in foreign countries. 6. Although the branch tries to decrease the TAT (turn around time) level as low as possible but if the TAT level is higher then it could be decreased in the following ways: MIS to be sent to branches to ensure basic scrutiny and customer education. MIS to be sent to branches to ensure basic scrutiny and to ensure images are clear when scanned. Work allocated so that routine transactions are not affected. When TOD in A/C- LC Bills then MIS to be sent to the respective business group.

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LIMITATIONS
Although I have tried to cover all the facts related to eternal trade finance operations, yet there are some limitations also due to time constraints and other factors, these limitations are as follows . The research is based on limited sample size. It may not show 100% accuracy. Trading is the vast area. Thus the research is too limited to external trade financial services only. The research is limited with the reference of the Ghaziabad branch of HDFC Bank. The report covers only main activities involved in the trade finance, and external trade because the whole activities would make this report very complex. The sample size is 50 because of time constraints.

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ANNEXURE QUESTIONNNAIRE

Company Name. Address .. Contact No... Email .. Id

1. Nature of business of the trader -----------Sole Proprietorship / Partnership / Limited Company. 2. What is the annual Turnover of your business? a) Below 5 lakhs c) 10 lakhs- 15 lakhs b) 5 lakhs- 10 lakhs d) above 15 lakhs

3. Apart from HDFC Bank that other banks you prefer for trade? a) SBI c) UBI d) Others 94 b) PNB d) BARCLAYS

4. With which foreign bank do you dealt with maximum as issuing bank or beneficiary bank and why? a) Bank of America c) J.P.Morgan chase b) BARCLAYS d) others

5. In which type of trade you are involved with HDFC Bank? a) Export c) Inward remittance b) Import d) Outward remittance

6. How many times you have done trade with HDFC Bank in 6 Months? ----------------------(optional) 7. How many times you have done import trade with HDFC Bank in 6 Months? ----------------------(optional) 8. How many times you have done export trade with HDFC Bank in 6 Months? ----------------------(optional) 9. How many times you have done remittance with HDFC Bank Varanasi in 6 Months? ----------------------(optional) 10. What do you prefer as a customer: a) Letter of credit b) Bank Guarantee

11. How are the products of bank in compression of other bank? a) More Beneficial b) Less Beneficial

12. How do you find service quality of HDFC bank in compression of other bank ? a) More faster c) Less faster e) Difficult to adopt 95 b) Equal d) More easy to adopt

13. How do you find the charges of the HDFC Bank different from the other banks? a) Expensive c) Cheaper b) equal

14. Any suggestions for the bank . . . . 15. Are you satisfied with the trade services provided by the HDFC Bank? YES NO

16. Where do you see your Company in next Three Years Turnover wise given the incentives by the Indian Govt.? .

* Thank you for your Participation*

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WEBLIOGRAPHY:
www.hdfcbank.com www.google.com (search engine) www.ask.com (search engine) www.bankingindia.com www.wikipedia.org

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BIBLIOGRAPHY:
BOOKS:

MACHIRAJU
SYSTEM

,H. V.K.

R.

INDIA

FINANCIAL

BHALLA,
MAGAZINES:

INTERNATIONAL

FINANCIAL MANAGEMENT V.

BUSINESS WORLD INDIA TODAY

Other material provided by employees of the bank

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