INTERNSHIP REPORT

SUBMITED TO
INDIAN OVERSEAS BANK
MOGAPPAIR BRANCH

SUBMITTED BY

M. JANANI PRIYA

B.COM HONOURS

WOMENS CHRISTIAN COLLEGE

ACKNOWLEDGEMENT

I would like to show my gratitude to Dr Lillian I Jasper, principal of

WOMEN’S CHRISTIAN COLLEGE and Dr Anita Priscilla, Head of
the Department of B.com Honours, for giving us this opportunity. I
would also like to extend our deepest gratitude to all those who have
directly and indirectly guided us in writing this report.

I also thank Indian overseas bank (mogappair branch) for providing me

internship and creating a learning opportunity.

ORGANISATION PROFILE
 Indian Overseas Bank is a major public sector bank based in Chennai. It has about 3700
domestic branches, including 1150 branches in Tamil Nadu, 3 extension counters, and 8
branches and offices overseas as of 30th September 2014. Founded on 10th February 1937, Indian
Bank overseas services include an ISO-certified in-house Information Technology department,
which has developed the software that is used by its branches to provide online banking services
to its customers. The Bank takes pride in its 100% networking status as well as 100% CBS status
for its branches.

About Indian Overseas Bank:

Indian Overseas Bank also has a network of about 3300 ATMs across the country. As far
as international presence is concerned, the Bank has branches in Singapore, Hong Kong,
Colombo, Seoul, and Bangkok. It also has representative offices in Guangzhou, Vietnam, and
Dubai. IOB is also part-owner of a joint venture bank in Malaysia.
The Bank was nationalized by the Government of India in 1969. And following this, it
emphasized more on opening of branches in rural India. Presently there are 11 Directors on the
Board of the Bank. When it comes to joint ventures/tie ups, Indian Overseas Bank financial
services has entered into Non Life Insurance Business with Universal Sompo General Insurance
(USGI) Company Limited with equity participation of 19% along with Allahabad Bank,
Karnataka Bank, and Dabur investments. Indian Overseas Bank banking services has also
extended itself further, by a tie-up with Apollo Munich Health Insurance to provide health and
personal accident products to its customers.
Vision and Mission:

According to the vision statement of the Bank 2013-2020, it aims to be amongst the
top five nationalized banks in terms of the volume of business and sustained profitability. It also
seeks to attain global recognition, led by high standards f governance and ethics. The Bank
focuses on emerging as the “Most Preferred Banking Partner” to unlock value to all its
stakeholders. The core values of IOB are customer centricity, honest, integrity, fairness, and
transparency, innovation and risk appetite, Green banking, etc. It endeavours to build leaders for
the banking industry, equipped with a team of skilled and dedicated employees.

The mission statement 2013-2020 lays down that the Bank would strive to deliver the
best of competitive products with regard to quality, range, utility, and cost effectiveness.
Optimization of HR resources, expansion of IT infrastructure, and engineering of CRM
(Customer Relationship Management) are also the chief goals of the Bank. It stresses immensely
on a policy-oriented and rule-driven culture, wherein the evolving needs of the customers are
met efficiently. It also attempts to streamline the process of service delivery from time to time,
besides encouraging a problem-solving climate so as to resolve customers’ grievances. IOB
believes in adopting a multi disciplinary approach to propel itself to further growth and evolve as
“banks with the Bank”.
WORK DONE:

WEEK 1:

ACCOUNT OPENING

During the first week, opening forms for savings and current accounts were gone
through and the procedure to open an account was understood. Savings bank account is a form of
demand deposit account, opened mainly for the purpose of saving and not for any business
purpose. Along with opening form the applicant requires to submit KYC (know your customer)
form. Approved account opening forms were gone through to study the required documents and
details for opening an account. OVD (officially valid documents) for opening an account were
learnt by looking at the account opening application form. The documents required to open an
account are two passport size photos coloured recent photographs, copy of PAN card or Form
60(with reasons of not having PAN card), two documents for proof of identity and proof of
address. A letter for the purpose of opening the account is also collected along with proofs.
Current accounts are opened at the discretion of the bank, on proper introduction. The KYC-
AML norms as indicated under SB account are applicable while opening current accounts also.
The minimum balance should be maintained in current account is Rs. 1000 in rural and Rs.2000
in urban and metropolitan branches. Operations in current accounts are only by cheques issued
by bank.

KINDS OF ACCOUNT:

ACCOUNT NAME TARGET GROUP REQUIRED MINIMUM

BALANCE
SB- Silver Individuals who are employed 0 Balance ,average daily balance
in reputed companies among during last three months should
Public / Private/ Government not be less than Rs.5000
sector, software companies
etc.
SB- Gold I Professionals and executives Average daily balance during last
working in MNC’s etc. three months should not be less
than Rs. 50000
SB- Gold II Professionals, Public/ Private Average daily balance during last
sector people, high net worth three months should not be less
people, IAS, IPS etc. than Rs. 100000
Corporate salary account
SB- Student
Little star account
All existing customers as and Can be opened and maintained at
when they request zero balance
All existing customers 500; Zero balance with permission
(students) above ten years of of GM
age
Kids from 1 day to 10 years Rs.100 for non cheque book A/C
and Rs.250 for non cheque book
A/C.

The other accounts provided by IOB are IOB SB platinum special, IOB classic current AC, IOB
super current account, IOB supreme CA. IOB also provides special salary accounts defence
customers namely SBDEFCOM and SBDEFNON. This information was obtained from the
banks study portal.

First, the customer is supposed to fill the Know Your Customer form with their personal details
and submit the required ID proofs and Address proofs. While opening current accounts for
business entities, branch should make a reference to CIBIL to ensure that the entity does not
have a borrowing arrangement with other banks.

PASSBOOK AND ENTRIES:

The process of how entries are made in passbook was shown. The bank uses the software called
finacle for all the operations in the system. The staffs enter the correct code in the menu bar
which leads them to the page for the respective work they have to do. The menu code consists of
6-7 letters. For the passbook entries, after entering the correct code in the menu the page for
passbook entries opens. Then the staffs type the account number and automatically the system
shows the page number and the line number from which it has to continue the printing. As the
entries should not overlap the staff made sure to change the line number to be one more than the
number which the system says.After checking the details the passbook is placed in the printer
and print is selected. The entries are correctly printed till the latest transaction.

IOB passbooks had a passport size photo of the account holder stuck in the inside of the book.
The staffs ask the customers to bring a photo if it is not stuck in the passbook. In case of issuing
a new passbook, the photo of the account holder is stuck in the new passbook and then the
account number is entered in the finacle page and the page number for entry is given as 1,
immediately the system shows the account holder name, address, and account number etc. to be
printed in the first page. After print is selected the above details are printed in the
book. Passbook entries could be done both by manually and through passbook entry machines.
WEEK 2

UPDATING KYC FORMS:

During the second week, opening forms of customers with current accounts from past years
were given and asked to check out for the updating of GST number, aadhar card and pan card
number. The defaulting customers were identified and informed.

SEGERATING CHEQUE BOOKS:

The old and the new arrived cheque books were checked and arranged alphabetically.

Types of deposits:
Different types of deposits were learnt with the help of the staff and by going through the deposit
opening forms and online portal. The different types of deposits are:

SHORT DEPOSITS, FIXED DEPOSITS:

Fixed sum of money is deposited in one lump sum for an agreed period to mature on a fixed
future date. Deposits for 6 months and above are fixed deposits and deposits below 6 six months
are short deposits.

RECURRING DEPOSITS:

An agreed sum of money is deposited every month for the agreed number of months.

MULTIPLE DEPOSIT SCHEME:

Convenient sum is deposited at any time convenient to the depositor for a fixed period or so as to
mature on a fixed future date

SPECIAL FIXED DEPOSIT:

This type of deposit is like the fixed deposit but interest will be paid monthly or quarterly to the
customer's account.

REINVESTMENT DEPOSIT PLAN:

This deposit is similar to fixed deposits but the only difference is the interest is calculated on the
basis of compound interest. The interest received here is more than the interest received in fixed
deposits where simple interest calculation is used.  Even if the customers want to make a fixed
deposit the bankers write it as RDP because of the high interest earned here. The
banker explained that fixed deposits are considered as RDP because of the more interest earned
here.

OPENING OF TERM DEPOSIT ACCOUNT:

Term deposit can be opened by a person in his own name, two or more persons in their joint
names, a natural guardian on behalf of minor, a club association, society, trustees. The depositor
has to submit two passport size photographs. Passports/ Postal Identification cards are accepted
as valid documents for the purpose of identification. The signature of the applicant and other
particulars as given in the application form and specimen signature card must agree with that
recorded in the passport. Any one of the other documents like Driving License, Voter Identity
card, PAN card, Ration card etc., is also to be submitted for the purpose verifying the identity
and address of the customer. Minimum deposit amount is Rs 1 lacs. Minimum period of deposit
is 3 years and maximum period of deposit is 10 years. Premature closure of deposit is not
allowed before completion of 3 years. The interest rate is reset twice every year in March and
September based on the link interest rate.

WEEK 3:

During third week, the process of cheques and demand drafts were explained.

CHEQUE PAYMENT:

They taught about the cheque payment process practically. When a cheque is presented for
payment, it is the banker’s responsibility to check the accuracy of the name, date, amount in
words and numbers, signature etc. In case of any default the banker should not proceed to the
next step of paying or processing. The FINACLE menu shortcut that is used for this purpose is
‘HTM’. The senior clerks check the necessaries, enter the required information in the system and
pass it on to the officers for passing or approval.

ARRANGEMENT FOR COLLECTION:

Local Cheques

All cheques and other negotiable instruments payable locally would be presented through the
clearing system prevailing at the centre. Cheques deposited at branch counters and in collection
boxes within the branch premises before the specified cut-off time will be presented for clearing
on the same day.
Outstation Cheques

Cheques drawn on other banks at outstation centres will normally be collected through Bank’s
branches at those centres.

Interest for delayed collection shall be paid at the following rates:

 Where the delay is beyond 14 days, interest will be paid at the rate applicable to for term
deposits of the respective period.
 In the case of extraordinary delay, i.e. delay exceeding 90 days, interest will be paid at
the rate of 2% above the corresponding term deposit rate.

Cheques lost in transit, in the clearing process or at paying bank’s branch:

In the event a cheque accepted for collection is lost in transit, the bank shall immediately on
coming to know of the loss, bring the same to the accountholder so that the accountholder can
inform the drawer to record stop payment and also take care that the cheques, if any, issued by
him are not dishonored due to non-credit of the amount of the lost cheques.

NEFT(National Electronic Fund Transfer):

National Electronic Funds Transfer (NEFT) is an electronic funds transfer system maintained

by the Reserve Bank of India (RBI). Started in November 2005, NEFT is a facility enabling bank
customers in India to transfer funds between any two NEFT-enabled bank accounts on a one-to-
one basis. It is done via electronic messages. Unlike Real-time gross settlement (RTGS), fund
transfers through the NEFT system do not occur in real-time basis. NEFT settles fund transfers in
half-hourly batches with 23 settlements occurring between 8:00 AM and 7:30 PM on week days
and the 1st, 3rd and 5th Saturday of the calendar month. Transfers initiated outside this time
period are settled at the next available window. No settlements are made on the second and
fourth Saturday of the month, or on Sundays, or on public holidays. Transfer of money to other
banks will be below 2 lakhs.

RTGS (Real time gross settlement system):

Real-time gross settlement systems are specialist funds transfer systems where the transfer
of money or securities takes place from one bank to another on a "real time" and on a "gross"
basis. Settlement in "real time" means a payment transaction is not subjected to any waiting
period, with transactions being settled as soon as they are processed. "Gross settlement" means
the transaction is settled on one-to-one basis without bundling or netting with any other
transaction. "Settlement" means that once processed, payments are final and irrevocable. RTGS
systems are typically used for high-value transactions that require and receive
immediate clearing. In some countries the RTGS systems may be the only way to get same day
cleared funds and so may be used when payments need to be settled urgently. However, most
regular payments would not use a RTGS system, but instead would use a national payment
system or network that allows participants to batch and net payments. RTGS payments typically
incur higher transaction costs and usually operated by a country's central bank.

Demand drafts (DD):

A demand draft is a prepaid negotiable instrument. The customers fill the DD challan. The DD
challan requires the name on which the DD is to be issued and the amount for which the DD is to
be issued. If the customer is paying through a cheque then the cheque should be pinned along
with challan. The banker receives the challan and the cheque and enters it in the finacle on the
correct menu for DD. The banker fills the name on which the DD is wanted. The cheque number
and the amount are filled. Along with these details the DD number on the DD is also filled in the
system. The banker takes down the transaction ID and waits for the approval from the officer.
After the officer verifies and approves the transaction, the banker prints the DD. The DD is
sealed and a sticker is stuck on the amount which is printed in the DD. The sticker is stuck to
prevent people from changing the amount which is printed. The DD is handed over to the
customer after the officer signs the DD.

WEEK 4

During week 4 loading ATM and collection of cash from Cash deposit machine (CDM) were
practically shown. It is done in the presence of two members and the machine needs double
passwords to be opened and denominations of cash were arranged accordingly in the respective
boxes allotted. The cash collected from the CDM is counted and tallied with the machine receipts
obtained.

FORM NO.15G and 15H forms:

Form 15G and form 15H are used for avoiding the TDS (Tax Deduction at
Source) deduction while computing the interest earned during the financial year.

Form 15G:-Declaration under sub-sections (1) and (1A) of section 197A of the
Income-tax Act, 1961, to be made by an individual or a person (not being a company or a
firm) claiming certain receipts without deduction of tax of tax.

Form 15G can be submitted by Individual below the age of 65 years (Age limit
reduced to 60 Years from from 1st July, 2012) and Hindu Undivided family.The above
points are applicable to the Form 15G as well, except  that the Form 15H is only for the
senior citizen.

Form 15G should be submitted before the first payment of interest on fixed deposit.
 In nutshell we can say that anybody whose tax on estimated income is not NIL and
having income from interest on securities/interest other than “interest on
securities”/units/amounts referred to in clause (a) of sub-section (2) of section 80CCA
exceeds maximum amount not chargeable to tax cannot file DECLARATION u/s 15G .
This is clear from the point 3 & 4 of the of From 15 G
 Senior Citizens who are eligible to file Declaration in Form 15H has no such conditions.
They can submit form 15H even if there total Income from interest on securities/interest
other than “interest on securities”/units/amounts referred to in clause (a) of sub-section
(2) of section 80CCA exceeds maximum amount not chargeable to tax if tax payable by
them is NIL.
 Form 15H :- Declaration under sub-section (1C) of section 197A of the Income-tax Act,
1961, to be made by an individual who is of the age of sixty-five years or more (Sixty
Years from 1st July, 2012) claiming certain receipts without deduction of tax.
 Form 15H can be submitted only by Individual above the age of 65 years. (Age limit
reduced to 60 Years from from 1st July, 2012)
 Estimated tax for the previous assessment year should be nil. That means he did not pay
any tax for the previous year because his income is not coming under the taxable limit.
 This form should be submitted to all the deductors to whom you advanced a loan. For
example you have deposit in three SBI bank branches Rs.100000 each. You must submit
the Form 15H to each branch.
 Submit this form before the first payment of your interest. It is not mandatory but it will
avoid the TDS deduction. In case of the delay, the bank may deduct the TDS and issue
TDS certificate at the end of year.
 15H forms are to be submitted to banks if interest from one branch of a bank exceeds
10000/- in a year.
 15H forms are to be submittedif interest on loan ,advance, debentures , bonds or say
Interest income other then interest on bank exceeds 5000/-.

LOANS AND ADVANCES:

IOB bank has large number of credit schemes to suit to the requirements of individual
customers. In finance, a loan is the lending of money from one individual, organization or
entity to another individual, organization or entity. A loan is a debt provided by an
organization or individual to another entity at an interest rate, and evidenced by a promissory
note which specifies, among other things, the principal amount of money borrowed, the
interest rate the lender is charging, and date of repayment.
TYPES OF LOANS

The different types of loans provided in Indian Overseas Bank are:

Overdraft:

The overdraft facility will be provided to current account holders. This is the facility provided by
the bank to withdraw more than the balance available in the account.

Cash credit:

This facility is provided for business purpose. It is generally sanctioned against stock and sundry
debtors. Every month drawing limit in the account fluctuates based on the value of stock
holdings and value of sundry debtors. For this, customers have to submit monthly stock
statement and debtor’s statement before 10th of next month. If it is not submitted within the
stipulated time 2% penal interest will be charged.

Miscellaneous cash credit:

This is purely against the value of the property mortgaged to the bank.

Housing loan:

Housing loans are loans borrowed for the purpose to buy, build or renovate a house or an
apartment. A maximum holiday period is 18 months from the date of first disbursement or
completion of construction whichever is earlier. In case the house is purchased, the holiday
period is 3 months.

Car loan:

Car loan is provided for the customers to purchase a car. Indian overseas bank offers vehicle loan
that cater even those in a lower bracket income. The vehicle loan scheme is called Pushpaka and
com Education loan:

Educational loan is made available for graduation/post-graduation/diploma/computer education

in any state/central government university, professional courses including engineering, medicine,
veterinary, law, dental, agriculture, management courses like ICWA, CA, CFA etc., courses
conducted by IIM, IISC, XLRI, NIFT etc. courses offered in India by reputed foreign
universities. For studies abroad, loans will be made available only for graduation and post-
graduation courses offered by reputed universities and not for diplomas.

Mudra loans:

MUDRA Bank or Micro Units Development and Refinance Agency Bank, is a new initiative by
the Government of India set up for the development of micro units. The loan under Pradhan
Mantri Mudra Yojana (PMMY) can be availed by any Indian citizen, with a credit requirement
of Rs 10 lakh and has a business plan for a non-farm sector income generating activity such as
trading, manufacturing, service sector, or processing. 

Jewel loan:

Gold loan is sanctioned by accepting the gold ornaments of the customers as pledge. IOB offers
gold loans for business and commercial purposes, known as commercial cash credit against
jewellery and gold loan.  In order to be eligible for commercial cash credit against jewellery, the
customer should own hallmarked gold, and be engaged in business activities or be self-
employed. The customer must also be able to demonstrate a stable source of income.

Pension loans:

This loan is provided for pensioners to meet their financial needs arising out of situations like
medical emergencies, educational expenses, marriage for children, family functions etc.

Flood loans:

This loan is provided for people who are affected in the floods. Recently, this loan was provided
during the Kerala floods.

All the loans should start from application forms. Due diligence has to be carried out. CIBIL
report has to be checked definitely.

CONCLUSION:

The internship at IOB provided me an opportunity to understand the banking world practically
which I have learnt only through books. I sincerely thank the managers and the staffs who guided
and assisted me in better understanding and helped me to fulfil my internship for the completion
of my degree.