GOVERNMENT FIRST GRADE COLLEGE FOR WOMEN

Internship Report On

“A Study On Gold Loan Scemes at Muthoot Finance

Chikkaballapur Branch”

Submitted in Partial Fulfillment of the Requirements of

Bachelor of Commerce Degree of Bengaluru North University

BY

Ms. Gagana T

REG NO-U19GL21C0014

UNDER THE GUIDANCE OF

SHIVANANDA. N M.com, M.phil

Assistant professor HOD department of commerce

Government First Grade College For Women Chikkaballapur

GOVERNMENT FIRST GRADE COLLEGE FOR WOMEN CHIKKABALLAPUR

2023-2024

1
2
 Government First Grade College For Women

Chikkaballapur-562101.

Affiliated to

Bengaluru North University

This is to certify that Ms. Gagana T bearing Registered No.U19GL21C0014 is a student

of VI SEM B.COM of our College. She has prepared Internship report entitled A Study
on Gold Loan scemes at Muthoot Finance, Chikkaballapur Branch from
16/04/2024 to 30/04/2024 towards the partial fulfillment of the requirement of
Bachelors of Commerce Degree of Bengaluru North University.

PRINCIPAL

3
 STUDENT DECLARATION

I Gagana T, Reg. NO. U19GL21C0014, hereby declare that this report entitled “A Study
On GOLD LOAN SCEMES AT MUTHOOT FINANCE CHIKKABALLAPUR BRANCH”
during the summer vacations between the period from 16/05/2024 to 30/05/2024 at
Muthoot Finance, Chikkaballapur under the supervision and guidance of Assistant Prof.
SHIVANANDA.N HOD of department of commerce GOVERNMENT FIRST GRADE
COLLEGE FOR WOMEN CHIKKABALLAPUR.

Date: Signature

Place: chikkaballapur REG NO: U19GL21C0014

4
 ACKNOWLEDGEMENT

I hereby acknowledgement my since gratitude and indebtedness to principal

CHANDRAIAH .G.D Government First Grade College for Women for being so kind to
allow me to purpose my interest on the subject and by giving his valuable guidance
throught out the preparation of his project.

A Summer project is a golden opportunity for learning and self –development. I consider
myself very lucky and honored to have so many wonderful people lead me through in
completion of this project.

The successful completion of this internship report required significant guidance and
assistance from many individuals, and I am truly grateful for their support throughout
this journey.

Firstly I would like to thank Mr.Pavan (group director – brand service) who in spite of
being extraordinarily busy with his duties, took time out to hear, guide and keep me on
the correct path.

A humble thank you Assisstant Professor SHIVANANDA.N has been my guide through
the entire internship period. He monitored my progress routinely shared her
knowledge and always encouraged me to go an extra edge towards fulfilling my duties; I
choose this moment to acknowledge her contribution gratefully.

I would like to extend my heartfelt thanks to my parents for their permission and
constant encouragement throughout this internship. Additionally, I am thankful to my
friends for their support whenever I needed their assistance during this project.

Lastly, I wish to thank Assisstant Professor SHIVANANDA.N my faculty mentor for

their guidance to make the most of such an excellent opportunity and in the successful
completion of this project.

5
 TABLE OF CONTENTS
SL PARTICULARES PAGE
NO NO
01 INTRODUCTION
 Introduction to Gold Loan 09 – 15
 Benefits of Gold Loan
 Interest rates and processing fees
 Objectives of Gold Loan
 Eligibility criteria for Gold Loan
 Documents Required for Gold Loan
02 DESCRIPTION OF THE ORGANISATION
 Location and spread of the company 16 - 19
 Number of employees
 Divisions of the company
 Main functions of the company
 profit and market share
 Administrative structure
Section 2 Business Model Canvas Tool: with this
visualize and asses your company or business idea and give a quick
overview of the business model of your company.

03 EXPERIENTIAL LEARNING
 New and improved skills and how to apply them 20 – 25
 Professional communications
 Networking important
 Taking constructive criticism well
 Work hard no matter what you`re doing
 Independence
 Making connections
 Data analysis and interpretation

6
04 INTERNSHIP OUTCOMES AND CONCLUSIONS
 Findings of the study 26
 Suggestions

05 CONCLUSION 27

06 BIBILIOGRAPHY 28

7
 Executive Summary

This project was really a challenge for me but I learned a lot while preparing
this project. This report provides me a chance to study and analyses the practical
aspects of the topic “Gold Loan Scemes of Muthoot Finance”. It enhanced my
knowledge in the field of Gold Loan. This project also give me the chance to improve
logical thinking and interacting patterns.

This project high lightens the importance of Gold Loan. This project also highlights the
product promotion during the visit to Muthoot Finance .The project deals with the
various aspects of Gold Loan. New Gold Loan mean that creating new Gold Loan area,
developing the new relation, doing new promotion and advertising is done in relation.
There exist some opportunity in the Gold Loan activity done by the company in the past.
The new Gold Loan of the company will develop the mutual relation with future
customers.

The Extract of the work is presented in this report under various headings as,
Introduction, Company`s profile, Project Introduction, Data analysis, Suggestions and
Conclusions.

While working on the project, I came to know about the latest Gold Loan and trends
premiling in the Gold Loan. The way of providing a better convenience of customer, and
developing the new Gold Loan technique to opt services.

8
CHAPTER -01

INTRUDUCTION

Muthoot Finance Ltd is the largest gold company in India. The company provides
personal and business loans secured by gold jewellery, or gold loans, primarily to
individuals who possess gold jewellery but could not access formal credit within a
reasonable time, or to whom credit may not be available at all, to meet unanticipated or
other short – term liquidity requirements. The company is headquartered in Kerala. In
addition to their gold loan 1 business, the company provides money transfer services
through their branches as sub-agents of various registered money transfer agencies.
They have commenced providing collection agency services. They also operate three
windmills of 1.25 MW each in the state of Tamil Nadu. Muthoot Finance Ltd was
incorporated on March 14, 1997 as a private company with the name the Muthoot Pvt
Ltd. The company is promoted by M G George Muthoot, George Thomas Muthoot,
George Jacob Muthoot and George Alexander Muthoot. The company`s operating
history evolved over a period of 70 years since M George Muthoot (the father of the
promoters) founded a gold loan business in 1939 under the heritage of a trading
business established by his father, Ninan Mathai Muthoot, in 1887. In the year 2001, the
company obtained the license from RBI to function as an NBFC. In the year 2005, as per
the scheme of amalgamation, Muthoot Enterprises Private Ltd was amalgamated with
the company with effect from March 22, 2005

9
INTRUDUCTION TO GOLD LOAN

Gold Loan (also called loan against gold) is a secured loan taken by the borrower from a
lender by pledging their gold articles (within a range of 18-24 carats) as collateral. The
loan amount provided is a certain percentage of the gold, typically upto 80%, based on
the current market value and quality of gold.

The gold loan, also referred as a loan against gold, is a secured loan that a borrower
takes from a lender in lieu of gold ornaments such as gold jewelry. The loan amount
sanctioned to you by lenders is generally a certain percentage of the gold`s value. You
can reply it through monthly installment after which you get your gold articles back.
Unlike other secured loans such as a home loan or car loan, there are no restrictions on
the end use of gold loans. So whether you need to fund a wedding, family vacation or
your child`s education, it is a great way to meet your sudden money requirement.
Moreover, a lot of private and nationalized banks along with NBFCs offer gold loans
ataffordable interest rates.

10
Benefits of Gold loan:-

Gold loan is similar to personal loan in meeting your immediate financial

requirements, be it an international education, marriage expenses, covering medical
emergencies or any other personal use

 Quick Disbursal: Minimum documentation leads to faster processing of gold

loan due to its secured nature.

 Flexibility of Use: Since there is no monitoring of the end use, it gives you the
flexibility to use the loan for any type of expenses.

 Secured Loan Type: you are not required to submit any other security
/collateral to the lender other than the pledged gold ornaments.

 Lower Interest Rate: Interest rates on gold loans are on the lower side when
compared to personal loan, since gold serves as collateral.

 Liquidate Your idle Asset: An idle asset, gold is seldom used for generating
money. Hence gold loan is the perfect solution to raise capital and use the fund
when you require money to meet your financial needs. It is also more secure in
the confines of a bank`s or a financial institution`s locker than your home.

Interest rates and processing fees:-

Interest rates for gold loan varies from lender to lender and ranges from 9.24%
to 17%. A nominal processing fee ranging from 1-3% of the loan amount is also charged
by some lenders. It is always advisable to check and compare interest rate, processing
fee, late payment charges and pre-payment charges with the lender before going for the
loan.

Documents required to process loan application:-

11
 Documents that are required to seek a gold loan vary from lender to lender.
However, the common list of documents includes: passport size photographs, identity
proof (PAN Card, Voter`s ID, Aadhar Card etc.) and Address proof (Passport, Driver`s
License, Electricity Bill etc.).

Any foreclosure charges:-

Yes, you can always foreclose the loan at any point of time. Most lenders do not levy
foreclosure charges for gold loans, but a few lenders charge between 2 – 4% of the
outstanding principal amount. You can always get in touch with the lender to know the
procedure they follow to foreclose.

The tenures for which I can avail the loan:-

Gold loan are short - term loans and have a flexible tenure ranging from a
minimum of 1 month to 5 years or more depending on the lender.

Should you look out for:-

Since gold loans are secured against your gold, you should be careful about loan
repayment and should take loan amount that you actually need and can repay
comfortably. Defaulting on loan can adversely affect your credit score and report
including cancellation of any future loan application.

If I am unable to clear my dues by the due date below are the actions
to be taken to process:-

Action taken on customers who default varies from lender to lender. Some
lenders charge interest for the time overdue, which is usually higher than the rate a
customer pays for the loan. Further default on loan payment will result in a notice sent
to you, informing you of the time within which you will have to clear your obligations.

12
Non- payment of loan by the final notice date can also lead to lenders auctioning your
gold articles to recover their outstanding loan amount.

Objectives of Gold Loan:-

 To Study about Gold Loan in detail with reference to muthoot Finance.

 To analysis customer satisfaction toward Gold Loan with reference to muthoot
finance.
 To analysis the Gold loan eligibility criteria with reference to muthoot finance.
 To know the purposes of a Gold loan taken by a customer.
 To know about the preference of the customer.
 To study the lending practice of Gold loan by Muthoot finance.
 To determine repayment method of Gold loan in Muthoot finance.

13
Eligibility Criteria for Gold Loan

 Individuals between 18 and 75 years can apply for a gold loan.

 The applicant must own gold jewellery, coins or bars to pledge as collateral for
the loan.
 The gold items being pledged should meet the lender`s specified purity criteria,
often ranging from 18 to 24 carats.
 The sanctioned loan amount depends on the pledged gold`s weight and current
market value.
 Applicants must provide government issued identification documents such as an
Aadhar card, PAN card, Passport, or voter ID.
 Lenders require proof of residence, which can be established through utility bills,
ration card, or driver`s licenses.
 While some lenders do not require proof of income, a stable income can enhance
the borrower`s credibility and loan approval chances.
 Individuals with a good repayment history of previous loans are often
considered favorably.

Documents Required for Gold Loan

 Proof of Identity (any one): Aadhar Card, PAN Card, Passport, Voter ID, Driving
License.
 Proof of Address (any one): Aadhar Card, Passport, Voter ID, Utility Bills
(electricity, water, gas), Ration Card, Driving License.
 Passport-size photographs: Recent passport – sized photographs of the
applicant.
 Proof of Ownership: Invoice or receipt of the pledged gold item (if available).
 Form of Gold: Details about the form of gold being pledged (jewelry, coins, bars)
and its purity level (in carats).
 Duly Signed Application Form: A filled and signed application form provided
by the lending institution.

14
 Income proof (optional): Some lenders may require income proof, although
gold loans are often granted without this requirement.
 Borrower`s Signature proof: Signatures on the application from should match
those on the identification documents.
 Witness Letter: sometimes, a witness letter from a known person in the locality
must confirm the applicant`s identity and address.
 Bank Account Details: some lenders may ask for the borrower`s bank account
details for loan disbursal and repayment purposes.

15
CHAPTER – 02

DESCRIPTION OF THE COMPANY

 LOCATION AND SPREAD OF THE COMPANY

Muthoot Finance Ltd is an Indian Financial Corporation and the largest gold loan NBFC
(Non - Banking Financial Company) in the country. In addition to financing gold loans
the company offers other forms of loans, insurance and money transfer services, and
sells gold coins. The company is head quartered in Kochi, Kerala and operates over
4,400 branches throughout the country. Outside India, Muthoot Finance is established
in the Uk, the US, and the United Arab Emirates.

The company falls under the brand umbrella of the Muthoot Group. Its stocks are listed
on the BSE and NSE since its initial public offering in 2011. The target market of
Muthoot Finance includes small businesses, Vendors, Farmers, Traders, SME business
owners, and salaried individuals.

The company has more than 4,500 branches spread across 29 states in India and union
territories of India. It has interests in financial services, information technology, media,
healthcare, plantations, precious metal, restaurant, and hospitality.

16
  NUMBER OF EMPLOYEES

ORIGIN OF THE COMPANY

Muthoot

Type Public

Traded as BSE:533398
BSE SENSEX Constituent
Industry Finance
Hotels &
Broadcast Media
Healthcare
Education
Energy & Power Generation
Infrastructure

Founded 1887 by Muthoot Ninan Mathai

Headquarters Kochi, India

Key People M G George Muthoot (Chairman)

George Alexander Muthoot (MD)
George Jacob Muthoot (Whole-Time Director)
George Thomas Muthoot (Whole-Time Director)
Employees 38000

The number of employees work as security providers are 64 employees are working
currently in the Muthoot Finance at chikkaballapur.

17
 III. DIVISION OF THE COMPANY

 Mortgage loans
 Insurance
 Mutual funds

IV. MAIN FUNCTIONS OF MUTHOOT FINANCE

 Gold loans
 Money transfer services
 PAN card services
 Travel solutions
 Digital and cash less solutions
 Foreign exchange
 Leasing and factoring services

V. CUSTOMER PROFIT AND MARKET SHARE

Muthoot Finance has reported steady growth in its revenue and profits over the years.
As per their latest annual report, the company’s total income grew by 17.5% and its net
profit increased by 22.9% in the financial year 2020-21 compared to the previous year.

In terms of market share, Muthoot Finance has a dominant position in the gold loan
market in India, with a share of around 20%. The company has also been expanding its
presence in other financial products such as personal loans, housing loans, and
insurance, which could contribute to its market share in those segments.

It's important to note that market conditions and company performance can change
over time, so this information may not be up-to-date. It’s always a good idea to consult
reliable financial sources for the latest information on company financials and market
share.

18
VI. ADMINISTRATIVE STRUCTURE

Muthoot Finance limited is a publicly-traded company headquartered in Kerala, India.

The company has a well-established administrative structure to manage its operations
across India and other countries where it operates.

Here is an overview of the administrative structure of Muthoot Finance:

Board of directors: The board of directors is responsible for overseeing the overall
management and direction of the company. It consists of independent directors,
executive directors, and non-executive directors.

Executive committee: The executive committee is responsible for implementing the

company’s strategies and policies. It comprises senior executives of the company,
including the managing director, Executive director, and other key members of the
management team.

Regional offices: Muthoot Finance has regional offices across India to oversee its
operations in different states. Each regional office is headed by a regional manager, who
is responsible for managing the company’s operations in that region.

Branch network: Muthoot Finance has a vast network of branches across India, which is
the backbone of its operations. Each branch is headed

Functional Departments: The company has a various functional Departments, such as

finance, human resources, marketing, legal, compliance, and IT, to support its
operations. Each department is headed by a senior executive who reports to managing
director or executive director.

Overall, Muthoot Finance has a well-structured administrative system that enables it to

manage its operations efficiently and effectively.

19
CHAPTER – 03

EXPERIENTIAL LEARNING

As a part of curriculum in my fifteen days of organizational study at “MUTHOOT

FINANCE”, I studied and learnt the processes carried the organization. The past weeks
of my internship have been instructive for me. “MUTHOOT FINANCE” have offered me
opportunity to learn and develop myself in many areas.

My mentor during my internship was Mr. SHIVANANDA N. He had made good

interaction with me, gave briefly explanation about muthoot finance.

I have been working with during my internship had good staff for learning about the
muthoot finance. Each intern had a different educational background and that made it
interesting for me. By working with them I got to learn from them and became of aware
of educational backgrounds.

New and improved skills and how to apply them

One of the most important things you can gain from an internship is newfound
knowledge. This can include knowing how to fulfill tasks that are relevant to your
desired career path and sharpening the skills that you already possess.

Many students think an internship mainly consists of making coffee and running
errands for superiors all day, but that is not true. And really, it shouldn’t be like that. An
internship is an opportunity to test out all the skills that you developed in varsity /
college and see how they work in the real world.

With internship opportunities, such as the Doctors without Borders organisation, you
will get an idea of that your biggest strengths are, as areas of improvement you should
work on.

Professional communications

Working in a professional setting for the first time can be difficult to get used to. But it
is the best way to learn how to navigate the working world through real-life, hands-on
experience.

20
One of the most valuable skills you will gain from an internship is the ability to speak
with people in a professional setting. Discussions with bosses or co-workers are
different from discussions with lecturers or fellow students.

After your internship, you should have a better idea of the appropriate way to behave as
a professional. This will help you a lot when you start interviewing for jobs because you
will be more confident and will sound more mature and experienced in a business
setting.

Networking is important

Don’t underestimate yourself; make sure you make the most of your internship and take
advantages of all the opportunities that come with it.

Also, unglue yourself from your desk every once in awhile and get to know other
interns. Not only will you end up creating great memories and making frineds, but you
will widen your professional network.

Taking constructive criticism well

Naturally, no one likes to be criticised and performance evaluations can be quite scary.
You will probably make a few mistakes and receive constructive criticism about your
work from both your colleagues and your boss.

Always remind yourself that it’s not personal. It is for your own good and growth and it
will improve the quality of your work.

Work hard no matter what you’re doing

Always work hard even if your task is small and seems unimportant. It will help you
build a good work ethic, and people will notice the effort you put in.

It’s not nice being told what to do all the time, but your superiors (mostly) know better.
Following the rules and instructions they give you makes it easier for everyone.

21
Independence

Often, we think being spoon-fed is the way to learn, but working independently has
proved to be very important. Your internship will teach you to make my own decisions
and do things on your own.

Being able to work independently with little guidance is very important in the working
world.

Making connections

In addition to the people who will be your references in the future, try to leave your
internship with new connections: senior employees, clients, fellow interns, etc.

These people can provide guidance, advice and help you in future job searches. Keep
them in the loop on where you are in your career, and offer to help them whenever you
can.

22
DATA ANALYSIS AND INTERPRETATION

a) PURPOSES FOR AVAILING LOANS

Purpose No of respondent Percent %

Business 12 50%
agriculture 7 20%
Health 8 10%
Other purpose 13 20%
Total 40 100%

Sales

20%

Business
Agriculture
10% 50%
health
other pupose

20%

The table -6 shows that 20% of people took loans for agriculture purposes.
50% taken for business purposes.

23
b) CUSTOMERS SATISFACTION TOWARDS GOLD LOAN

Satisfaction level No of respondent Percent

Highly satisfied 22 30%
Satisfied 12 50%
Dissatisfied 6 20%
Total 40 100%

Satisfaction level

20%
30%

Highly satisfied
Satisfied
Dissatisfied

50%

The customers satisfaction 30% customers Highly Satisfied and only 20%
customers Dissatisfied and 50% satisfied.

24
CHAPTER – 04

INTERNSHIP OUTCOMES AND CONCLUSIONS

Findings of the study:

1. The study show that Out of 20 respondents, 78% preferred muthoot finance and 22%
of respondents preferred other financial institutions to avail a gold loan.

2. More than 85%respondents preferred to avail a gold loan when compared to other
loans.

3. The primary factor which influenced to avail gold loan from muthoot finance Were
high security for the jewels pledged.

4. The Borrowers of muth0oth finance were highly satisfied with the safety for the
security pledged, and they are dissatisfied with the quality of services provided.

Suggestions:

1. The Muthoot finance should provide an adequate amount of gold loan, similar to
other financial banks and Companies. Therefore the preference of borrowers towards
Bank of India increases in availing a gold loan. Even though the rate of interest charged
is same as other financial banks and companies, the borrowers prefer to avail gold loans
from other institutions as the time is taken to disburse the gold The loan is less.

2. The Muthoot finance should try to disburse the gold loan within a short duration and
also improve the quality of services while giving gold loan to the borrowers.

3. There is great scope for expanding financial inclusion in extending gold jewellery
loans. If Banks continue to increase.

25
CHAPTER -05

CONCLUSION

Thus it can be concluded that gold loan has become one of India’s fastest
growing businesses. It was obvious that the majority of people prefer Muthoot finance
when compared to other institutions irrespective of the attractive features followed by
other institutions. This is because the Muthoot finance ensures security for the gold
ornaments pledged, and the rate of interest charged is also less. But the preference
towards other institutions in availing gold loan also is increasing nowadays as they
provide an adequate amount for the gold jewels pledged and the time taken to disburse
the gold loan is even less. Therefore the borrowers meet their expenses at the time of
emergency. Thus gold loans offered by Muthoot finance and other institutions help the
marginal sections of society in meeting their necessary fund requirements whenever
required.

26
CHAPTER – 06

BIBLIOGRAPHY

1. Books:- a. M. G. George Muthoot – Remembering a Prodigy of Leadership,

Entrepreneurship & Humanity.

b. Financial Institutions Management: A Risk Management Approach, 8th Edition ·

Anthony Saunders

2. Website:-

a. https://www.muthootfinance.com/

b. https://www.muthootgroup.com/

c. https://en.wikipedia.org/wiki/Muthoot_Fin

ance

27
28
29