Table of contents

PARTICULARS Page numbers

1. Introduction to personal loans 2-3

2. Literature review 4

3. Objective of the study 5

4. Research Questions (Scope of the study) 5

5. Significance of the study 5

6. Eligibility criteria 6-11

A. Fullerton India
B. HDB financial services
C. Barclays finance

7. Research methodology 12-13

8. Limitations of the study 14

9. Annexure 15-17

10. Refrences 18

COMPARATIVE STUDY ON PERSONAL LOANS 1

 INTRODUCTION TO PERSONAL LOANS

With a lot many lenders on the block willing to offer their loan services to all,
applying for a loan nowadays, is no longer a problem. Gone are the days when
you had to wait to buy something or go out and do what you wanted to, because
a hassle free and available to all personal loan is now no more a dream, but a
reality.  

Today, various loans are available in the market to suit individual needs of the
people. In Personal Loans as well, different types of loans are available. They can
serve you well in your financial limitations while making your living better. No
delay should be done in availing a loan especially when it suits your financial
situation and can be available to you in a desired time. 

Personal Loans are basically of two types:  

1.Secured Personal Loans

2.Unsecured Personal Loans  

Secured personal loans can only be obtained by a borrower after keeping an

asset such as real estate property, car or jewelry as collateral with the lender.  

These kinds of loans help the lenders make sure that they will get their money
back, and hence they approve and provide the loans for any amount of money
with more security. Other than that, the approval of the loan application also
depends a lot on the borrower’s credit history, his current monetary position, his
current employment status and the obtainable equity in the deposited
collateral. 

Unsecured personal loans are one of its kind loans which do not ask you for
depositing any valuable as security, while serving your financial purpose rightly
as well. These loans suit the purpose of those borrowers well who do not want to
keep their valuables with someone.

COMPARATIVE STUDY ON PERSONAL LOANS 2

Both these loans are now easily available online. At TheLoanBazaar.com, we offer
you quick access to both types of Personal Loans to suit your requirements. With
just a simple sign up for an application form, you can get your loan amount put in
directly in your bank account.
A hassle free lending process with very less paperwork and full support from our
customer support and loan professionals, taking a loan could never get any
easier and simpler. 

Personal Loans have very many advantages to them, with first and foremost being
so many personal loans choices. With both the secured and unsecured loans,
there are so many plans to suit your individual needs along with varied interest
rates. 

It is advisable by TheLoanBazaar.com that every borrower should first shop

around the market to look for the best loan program that suits his needs fully,
and secondly, also gain knowledge about the various interest rates being offered
by different lenders.  

This will allow him to gain maximum knowledge and then make a suitably wise
decision by choosing the right lender. 

Personal loans by TheLoanBazaar.com are available to the borrowers for any

purpose they want. They can either buy a real estate property or pay their
children’s school fee or buy a car etc.

With online loaning, the borrowers have the advantage of being charged lesser
that the land based loan provider. Also, with easily contactable and accessible
platform, the borrower can at anytime call up the chosen loan company if they
are facing any kinds of problems or want any advice. 

COMPARATIVE STUDY ON PERSONAL LOANS 3

LITERATURE REVIEW

With the mounting national problem of rising debt levels, loan companies are
needing to place just as much significance on advice and guidance as on offering
the loans themselves - because while loans are often portrayed as (and can
certainly often prove to be) a quick 'solution' or 'fix,' they can also cause the
opposite effect by placing people into financial trouble or pushing some into
further difficulties. However, it's certainly not in the interest of loan institutions
to discourage people from taking loans out through themselves - meaning that
such advice and guidance is not always easy to come by.

What's more, people often turn to loans and credit cards once they have already
run out of equity on their homes - meaning that at that point, they're well on
their way to digging themselves into potentially unmanageable financial
difficulty. The boom in house prices during recent years has led to many people
releasing equity from their homes to fund their lifestyles. As the housing market
has developed over time, the rate of growth has gradually slowed down,
resulting in many people turning to other sources of funding, such as high
interest secured loans and credit cards to fund luxury lifestyles or to control
previous borrowings and debt.

Recent research has shown that while nearly one in five people are willing to take
out a secured loan to help finance their lifestyle, more surprisingly one in eight
would do this to purchase a luxury item regardless of whether they had any
equity tied up in their home to help fund the loan. This is a surprising statistic
considering the same research states that despite this level of intense borrowing
only one in twenty five people have been advised against taking out a further
loan or credit card to fund their lifestyle or control their current finances.

This should be viewed as a serious problem as there will come a time when some
peoples' financial situations may become so serious, such as when facing
repossession of property, that they may feel they have nowhere to turn. Where
can someone in this situation turn, in an environment where nationally adverse
personal debt is rapidly rising, however the majority of financial advisors seem to
be advising only a small number of people not to take further loans or credit?

While it is fair to say that even in the most serious of situations (home
repossession or court hearing, for example); there is help or advice available in
the form of debt counselling, consolidation services or voluntary agreements
(IVS or Trust Deeds).By contacting a specialist company who can ensure a
property can be sold quickly repossession can be effectively halted before it
begins. Some companies offer to purchase a property with the option to rent or
buy back the property ensuring that families keep the same roof over their heads

COMPARATIVE STUDY ON PERSONAL LOANS 4

through this difficult time with the possibility of once again owning their home
when finances finally improve.

Objectives of this topic:

The financial sector is one of the booming and increasing sectors in India. The
Personal Banker are one of the most powerful, efficient and effective channel
through which the company sales its various types of financial products and
company takes operational work also. It is really difficult to convince customers
and sell a single product and accomplish operational work. Whereas in my entire
project work I found my interest in working in a team, dealing with customers
and finally convincing them to buy a product.

Scope of the study:

Scope Financial Services is a provider of owner occupied home loans, investment

loans, personal loans and insurance. We see ourselves as advocates for our
clients, and will save you time and effort by sourcing the right loan for you.

Our goal is to make the loan process simple, stress-free and seamless. We take
pride in offering a superior level of customer service both while we organise your
loan and on an ongoing basis. This, coupled with our honest and knowledgeable
approach to your unique borrowing needs, means that we have built a large and
loyal client base over the years. We are happy to say that all of our business
comes in the form of referrals and repeat business from our satisfied clients.

Our service is free. We are paid by the lenders, not you. Our confidence in our
ability to organise the right loan and provide outstanding service means that we
are willing to provide you a satisfaction guarantee.

Significance of the study:

The ultimate purpose of giving me this topic was to know about the customer’s
perceptions about the different products of the bank, and to know about
operational process. how these products can attract them and how the company
can generate maximum profit by convincing them through personal banker and
to better understand customer requirement and to understand operational
methodology.

COMPARATIVE STUDY ON PERSONAL LOANS 5

 Eligibility criteria
Fullerton India credit company limited

1 Age
Salaried:21 years

Self-employed:25 years
2 Income criteria

Salaried and pensioner:7000 and above

Self-employed: Income tax return 1.5 lakh

3 know your customer documents(KYC documents)

Salaried:

Id proof
Residence proof
3months salary slip
Application letter
6months bank statement
Form-16

Self-employed:

Id proof
residence proof
3years IT return
6months bank statement
shop and establishment certificate

4 minimum loan amount

Salaried:

30000 to 5 lakhs rs
Exceptional cases:5-10 lakhs(high salaried)

Self-employed:1 lakh

COMPARATIVE STUDY ON PERSONAL LOANS 6

5 cash flow analysis
Salaried and self employed:

6 Interest rates
18-49% Reducing Rate.

7 cost of funds
12%

8 Type
Unsecured loan

COMPARATIVE STUDY ON PERSONAL LOANS 7

 HDB FINANCIAL SERVICES
1 Age

Salaried:21 years
Self-employed:25 years

2 Income criteria
Salaried and pensioner:10000 and above

Self-employed: Income tax return 15 lakh

3 know your customer documents(KYC documents)

Salaried:

Id proof
Residence proof
3months salary slip
Application letter
6months bank statement
Form-16

Self-employed:

Id proof
residence proof
3years IT return
6months bank statement
shop and establishment certificate

4 minimum loan amount

Salaried: 50000-5 lakhs rs

Self-employed:50000rs

COMPARATIVE STUDY ON PERSONAL LOANS 8

5 cash flow analysis
Salaried and self employed:40%(Net income)

6 Interest rates
18-35% Reducing Rate.

7 cost of funds
Gets its funds from HDFC bank

8 Type
Unsecured loan

COMPARATIVE STUDY ON PERSONAL LOANS 9

 Barclays finance

1 Age
Salaried:21 years

Self-employed:25 years
2 Income criteria

Salaried and pensioner:15000 and above

Self-employed: Income tax return 5 lakh

3 know your customer documents(KYC documents)

Salaried:

Id proof
Residence proof
3months salary slip
Application letter
6months bank
statement
Form-16

Self-employed:

Id proof
residence proof
3years IT return
6months bank statement
shop and establishment certificate

4 minimum loan amount

Salaried:50000 to10 lakhs rupees,

Self-employed:5lakhs and above which is known as business loan.

COMPARATIVE STUDY ON PERSONAL LOANS 10

5 cash flow analysis
Salaried and self employed:50%(Net income)

6 Interest rates
18-35% Reducing Rate.

7 cost of funds
Funds of Barclays bank

8 Type
Unsecured loan

COMPARATIVE STUDY ON PERSONAL LOANS 11

 RESARCH METHODOLOGY

Data collection is a term used to describe a process of preparing and collecting

business data- for example as part of a process improvement or similar project.
Data collection usually takes place early on in an improvement project, and is
often formalized through a data collection Plan which often contains the
following activity:-
1. Pre collection activity- Agree goals, target data, definitions, methods
2. Collection- data collection
3. Present Findings- usually involves some form of sorting analysis and/or
presentation

There are two methods of data collection which are discussed below:-

DATA COLLECTION

PRIMARY DATA SECONDARY

DATA(Data collection techniques)

QUESTIONNAIRE INTERVIEW EXTERNAL

INTERNET
INTERNAL SOURCE

Primary data:

In primary data collection, you collect the data yourself using methods such as
interviews and questionnaires. The key point here is that the data you collect is
unique to you and your research and, until you publish, no one else has access
to it.
I have tried to collect the data using methods such as interviews and
questionnaires.

The key point here is that the data collected is unique and research and, no one
else has access to it. It is done to get the real scenario and to get the original
data of present.

DATA COLLECTION TECHNIQUE

COMPARATIVE STUDY ON PERSONAL LOANS 12

Questionnaire:
Questionnaires are popular means of collecting data, but are difficult to design
and often require many rewrites before an acceptable questionnaire is produced.
The features included in questionnaire are:
 Theme and covering letter
 Instruction for completion
 Types of questions
 Length

Interview:
This technique is primarily used to gain an understanding of the underlying
reasons and motivations for people’s attitudes, preferences or behavior. The
interview was done by asking a general question. I encourage the respondent to
talk freely. I have used an unstructured format, the subsequent direction of the
interview being determined by the respondent’s initial reply, and come to know
what its initial problem is.

SAMPLING METHODOLOGY

Sampling Technique:

Initially, a rough draft was prepared keeping in mind the objective of the
research.
A pilot study was done in order to know the accuracy of the questionnaire. The
final questionnaire was arrived only after certain important changes were done.
Thus my sampling came out to be judgemental and continent.

Sampling Unit:
The respondents who were asked to fill out questionnaires are the sampling
units. These comprise of the employees who work at The Pride Hotel,
Ahmedabad and utilize the service of the cafeteria everyday.

COMPARATIVE STUDY ON PERSONAL LOANS 13

 LIMITATIONS OF THE STUDY:

 Since banks perceive higher risk in this category, many follow a list of
approved categories of borrowers. If your profile doesn't match up to any of
these pre-approved categories, your loan application will be rejected.

 The interest rate of personal loan can be high; sometimes double that of
home loans, especially if your credit profile is weak.
 Of course, there is a downside. Though paperwork is minimal -- since the
asset is not even defined clearly the qualifying criteria are  far stricter.
 Therefore, the financier is perhaps doing a more thorough check on your
capability to repay than s/he might even in the case of financing a home loan, for
instance.
  Since financiers perceive higher risk in this category, many follow a list of
approved categories of borrowers.
  Interest rates for personal loans are higher, ranging from 12 per cent to
30 per cent. All other rates including service charges and prepayment penalty are
higher as well.

COMPARATIVE STUDY ON PERSONAL LOANS 14

 A Survey of personal loan

PART-A (Personal details)

Name :

Age :
Contact no. :

Qualifiaction :
Temporary address:

Permanent address:

NOTE:

All of the above and below given answers by you will be kept private and
confidential

COMPARATIVE STUDY ON PERSONAL LOANS 15

PART-B

1. Do you require a personal loan?

o Yes
o No

2.If yes for what purpose?

o Marriage
o Education
o Medical emergency
o Investment
o If any other please specify ________

3. What is the amount of your loan requirement?

o 30-50k
o 51- 99k
o 1- 1.99lakh
o 2-2.99lakh
o 3-3.99lakh
o 4 lakhs and above

4. Your profile?
o Salaried
o Self-employed
o Pensioner
o Retired

5.Which sector do you work

o Public ltd
o Private limited
o If any others please specify______________

6. If salaried what is your monthly income?

o 7000-15000k

COMPARATIVE STUDY ON PERSONAL LOANS 16

 o 16000-30000k
o 31000-50000k
o More than 50000

7. If self-employed what is your annual income

o 1.5-3 lakhs
o 4-6 lakhs
o 7-10 lakhs
o 11 lakhs and above

8. Number of dependants

o 1
o 2
o 3
o 4 or above

9. (A)Do you have your own house

o Yes
o No

10. How much EMI you can afford

o 2-5k
o 6-7k
o 8-10k
o 10k or above

THANK YOU FOR YOUR CO-OPERATION

COMPARATIVE STUDY ON PERSONAL LOANS 17

Refrences:
1. websites
A. Apnapaisa.com
B. Loanbazaar.com
2. Articles
A. Most Viewed EzineArticles in the Finance:Personal-Loans Category (60
days)

COMPARATIVE STUDY ON PERSONAL LOANS 18

COMPARATIVE STUDY ON PERSONAL LOANS 19