From the desk of Managing Director & CEO

My dear members of PNB Parivar,

Our endeavor in this New Year will ‘War Room for Recovery’ has
be to develop broader, deeper & been created at Head Office for intensive
more enduring relationship with follow up and the success of this set up
our customers; thereby continuing wholly depends on the support from the
our philosophy of “placing our field. The need of the hour is to devote
customers at the heart of everything some employees exclusively for recovery
we do”. I am confident that PNB purpose and this requirement has been
will continue to be at the forefront of communicated to the field by the Recovery
the Indian banking sector as I know Division time and again.
that together we stand strong and
swift to serve our customers. The mechanism to be adopted for recovery
/ resolution of NPAs varies with the type
I wish all of you to gain all-around And nature of account and so account
success in the New Year 2016. We specific strategies have to be adopted.
While the War Room in Head Office would
all will together look forward to
extend all necessary support from here, it
PNB‟s march towards brighter
is necessary that adequate number of
and exciting journey ahead. officials well versed in recovery techniques
are used exclusively for recovery work in
the field as well.

We know that the ‘Performance and Survival’ is in the DNA of PNB. The Bank has shown its resilience to
overcome the difficult times during its journey of over 120 years and I am confident that it will surmount the
present challenges. We have only to unleash the full potential of the Bank. We have millions of valuable
customers, thousands of employees, and vast network of branches across the country. By building on this
foundation, the Bank is well placed to be ‘Number One’ for customer service, trust and advocacy. Let us all
be committed to drive performance as we have the capability and confidence in our ability to deliver.

“On the road to success, the rule is always to look ahead. May you reach
your destination. May your journey be wonderful”.

“Teamwork is the ability to work together toward a common vision. The

ability to direct individual accomplishments toward
organizational objectives is the fuel, that allows common
people to attain uncommon results”

“Whatever the mind of man can conceive and believe, it can achieve”.
The Financial Year 2016 concluded with the Global Business of the Bank crossing Rs 9.75
lakh crore based on the provisional figures. In terms of absolute growth, the Bank has been
able to sustain its double digit growth at 10.9% on YoY basis. This double digit growth was
primarily due to the performance of the Bank in the domestic market. During FY’16, the
Bank’s Domestic Business has crossed Rs 8.50 lakh crore landmark while registering
YoY growth of 10.8% as compared to 7.4% in FY’15. On the other hand, the growth in
Overseas Business of the Bank which had gained momentum in FY’15, slowed down to
11.8% in FY’16.

I would like to highlight the priorities for the Financial Year’2017. As we stand at the start
of Financial Year 2017, we have to intensify our efforts to increase the share of small
ticket advances and less risk weighted assets or highly rated accounts to the existing
credit portfolio which will not only improve the Bottom-line position but also help maintain
Capital adequacy. We also need to increase the Current Deposits growth besides continuing
with our efforts to augment saving deposits. The Bank has moved from the negative growth
in CASA Deposits in FY’15 to double digit growth in FY’16 crossing the landmark of Rs
2,00,000 crore. Let’s keep this momentum going strong in FY’17 also. Our lead position in
CASA, especially Saving Deposits should not only be maintained but we should also
surge ahead. Last but not the least, we have to continue building the core business
through our strategy of ‘Go-Retail’ supported by the digital wave.

There are many positive developments taking place in the economy as well as in
banking sector. The banking landscape is changing at a rapid pace. In this scenario, the
key drivers for performance will be Service, Sales and Marketing.

The analysis of bottom-line parameters and credit will be communicated on declaration

of FY’16 financial results. I am confident of your abilities, willingness and passion to
work hard and succeed together. I am sure that Team PNB will work for its best days
ahead.
 A

HANDBOOK

FOR

PROMOTION

EXAMS

P S Sharma Satish Relhan

Chief Training Manager Ritesh Gera
Surinder Singh

ZONAL TRAINING CENTRE, JAIPUR

, JAIPUR
 ECONOMIC DEVELOPMENT BUDGET & POLICY

Highlights of Banking and Financial Developments in 2015

January 2015

• To ensure transparency in the promotional material and to build an enduring relationship with the
customers, the Reserve Bank on January2, 2015 advised all authorised entities operating a payment
system within the country that - (i) all the information available to the public regarding the product, whether
as advertisements, on website, application form, to prominently carry the name of the entity/company
authorised by the Reserve Bank under the Payment and Settlement Act, 2007 and (ii) the authorised
entities/companies to regularly keep the Reserve Bank informed regarding the brand names employed / to
be employed for their products.

• The Reserve Bank on January 7, 2015, modified the master circular on wilful defaulters to bring in greater
transparency and accountability and in the process required to be adopted for identification of wilful
defaulters.

• The Reserve Bank, on January 15, 2015, permitted banks to undertake insurance business by setting up
a subsidiary/joint venture, as well as undertake insurance broking/ insurance agency/either departmentally
or through a subsidiary subject to certain conditions.

• In order to further enhance transparency in pricing of credit, the Reserve Bank advised all banks on
January 22, 2015, to display on their website, among others, –(i) the interest rate range of contracted loans
for the past quarter for different categories of advances granted to individual borrowers along with mean
interest rates for such loans; (ii) the total fees and charges applicable on various types of loans to
individual borrower; and (iii) Annual Percentage Rate (APR) or such similar other arrangement of
representing the total cost of credit on a loan to an individual borrower.

February 2015

• The Reserve Bank, on February 4, 2015, announced the names of the members of the External Advisory
Committee (EAC) for small finance banks and of the External Advisory Committee for payments banks.

• The Reserve Bank, on February 5, 2015 placed on its website the final guidelines for implementation of
Countercyclical Capital Buffer (CCCB) in India.

• The Reserve Bank, on February 12, 2015 released the Annual Report of the Banking Ombudsman
Scheme for the year 2013-2014. The report highlights various customer service initiatives by the Reserve
Bank and some exemplary cases dealt with by offices of Banking Ombudsman during the year.

• The Reserve Bank in February 2015 put in circulation currency notes in one rupee denomination, printed
by the Government of India. These currency notes are legal tender as provided in The Coinage Act 2011.

March 2015

• The Reserve Bank released the Report of the Internal Working Group to Revisit the Existing Priority
Sector Lending Guidelines (Chair: Lily Vadera, Chief General Manager, Department of Banking
Regulation) on March 2, 2015.
• With a view to encourage availability of affordable housing to economically weaker sections (EWS) and
low income groups (LIG) borrowers, the Reserve Bank issued instructions on March 5, 2015 that in cases
where the cost of the house/dwelling unit does not exceed ₹ 10 lakh, banks may add stamp duty,
registration and other documentation charges to the cost of the house/ dwelling unit for the purpose of
calculating Loan to Value (LTV) ratio.

• The Reserve Bank, on March 11, 2015, advised banks to meticulously adhere to the guidelines on
managing risks as applicable in outsourcing of financial services. The banks also need to take steps to
ensure that the service provider employs the same high standard of care in performing the services as
would be employed by the banks, if the activities were conducted within the banks and not outsourced.

April 2015

• The Reserve Bank, on April 10, 2015, issued revised guidelines for Priority Sector Lending after
deliberating on the comments / suggestions received from Government of India, banks, and other
stakeholders.

• The Reserve Bank, on April 16, 2015, permitted all scheduled commercial banks (excluding RRBs) to
offer differential interest rates based on whether the term deposits are with or without-premature-
withdrawal-facility, subject to certain guidelines.

• The Reserve Bank advised authorised dealers category-I (AD Category- I) banks that with effect from on
April 8, 2015, foreign direct investment (FDI) in insurance sector shall be permitted up to 49 percent
subject to the revised conditions.

• The Reserve Bank, on April 23, 2015, simplified the instructions for setting up of new currency chests-
“Construction of Currency Chests Strong Rooms / Vaults”.

May 2015

• The Reserve Bank advised all scheduled commercial banks (excluding regional rural banks) and all India
select financial institutions to follow the ‘Framework for fraud risk management in banks’ with effect from
May 7, 2015

• The Reserve Bank on May 11, 2015 advised all public sector banks and select private sector and foreign
banks to appoint an internal ombudsman, designated as Chief Customer Service Officer (CCSO) to further
boost the quality of customer service and to ensure that there is undivided attention to resolution of
customer complaints in banks.

• The Reserve Bank on April 30, 2015 dispensed with the requirement of prior approval from the Reserve
Bank and the minimum eligibility criteria for non-banking financial companies (NBFCs) to distribute mutual
fund products. The Reserve Bank on May 14, 2015 in consultation with the Government of India, allowed
entry of the Infrastructure Debt Fund-Non-Banking Financial Companies (IDF-NBFCs) into sectors even
where there is no presence of a Project Authority.

• The Reserve Bank, on May 14, 2015, advised on the relaxation in requirement of additional factor of
authentication (AFA) for small value card present transactions (SVCP) for values up to ₹ 2,000/- per
transaction across all merchant categories.
June 2015

• In order to enable private sector banks to attract and retain professional directors, the Reserve Bank, on
June 1, 2015, issued guidelines on compensation for non-executive Directors for implementation by private
sector banks, that will reflect market realities and will be within the parameters specified in the Banking
Regulation Act, 1949 and the Companies Act, 2013.

• The Reserve Bank, on June 1, 2015, permitted all banks authorised to deal in foreign exchange/ all
authorised money changers (AMCs) / full-fledged money changers (FFMCs) to allow remittances by a
resident individual up to USD 250,000 per financial year for any permitted current or capital account
transaction or a combination of both.

• The Reserve Bank, on June 8, 2015, advised that under the “Framework for Revitalizing Distressed
Assets in the Economy – Guidelines on Joint Lenders’ Forum (JLF) and Corrective Action Plan (CAP)”,
issued on February 26, 2014, the Joint Lenders’ Forum (JLF) should actively consider change in
ownership, in cases of restructuring of accounts when the borrower companies are not able to come out of
stress due to operational/ managerial inefficiencies despite substantial sacrifices made by the lending
banks.

• The Reserve Bank, on June 12, 2015, released the final guidelines for introduction of 6-year and 13-year
cash settled Interest Rate Futures (IRF) on Government of India Securities with residual maturity of 4-8
years and 11- 15 years, respectively. It also expanded the residual maturity for the existing 10-year cash
settled IRF from 9-11 years to 8-11 years.

• The Reserve Bank, on June 25, 2015, issued ₹ 100 denomination banknotes in Mahatma Gandhi Series
– 2005 with a new numbering pattern. In these notes, the numerals in both the number panels of these
banknotes are in ascending size from left to right, while the first three alphanumeric characters (prefix)
remain constant in size.

July , 2015

• The Reserve Bank, on July 9, 2015, issued the final guidelines on Prepaid Payment Instruments for Mass
Transit System (PPI-MTS) enabling the issuance of a separate category of semi-closed prepaid payment
instruments for mass transit systems. The PPI-MTS can be used within the mass transit systems and will
have a minimum validity of six months from date of issue. Apart from the mass transit system, such PPI-
MTS can be used at other merchants whose activities are allied to or are carried on within the premises of
the transit system.

• The Reserve Bank, on July 15, 2015, announced the constitution of a Committee (Chairman- Shri
Deepak Mohanty, Executive Director) with the objective of working out a medium-term (five year)
measurable action plan for financial inclusion.

• The Reserve Bank, on July 16, 2015, revised the guidelines for concurrent audit system in commercial
banks, in view of the changes in banks’ organizational structure, business models and use of technology
(implementation of Core Banking Solution).

• As part of the endeavour to smoothen the liquidity management operations, the Reserve Bank, on July
27, 2015 introduced Straight Through Processing (STP) in fixed rate Liquidity Adjustment Facility (LAF)
Repo, fixed rate LAF Reverse Repo and Marginal Standing Facility (MSF) operations.
• The Reserve Bank, on July 30, 2015, permitted primary (urban) cooperative banks to offer services that
can be offered via a standardized ATM machine like bill payments, account transfers at their on-site / off-
site / mobile ATMs.

August 2015

• The Reserve Bank, on August 6, 2015, dispensed with the existing instructions permitting domestic
scheduled commercial banks (excluding regional rural banks) to undertake merger, closure, shifting, part-
shifting, opening of extension counters and reporting in accordance with certain instructions.

• The Reserve Bank, on August 19, 2015 granted “in-principle” approval to 11 applicants to set up
payments banks under the Guidelines for Licensing of Payments Banks issued on November 27, 2014.

• The Central Government on August 20, 2015, declared the second and the fourth Saturday of every
month as public holiday for banks in India, whether or not such banks are included in the Second Schedule
to the Reserve Bank of India Act, 1934 (2 of 1934), with effect from September 1, 2015. Banks will,
however, function full time as on any working day on first, third and fifth Saturday of every month.

• The Reserve Bank, on August 20, 2015 placed on its website the Report of the High Powered Committee
on Urban Co-operative Banks (UCBs) (Chairman: Shri R. Gandhi).

• The Reserve Bank, on August 27, 2015, advised scheduled commercial banks (excluding regional rural
banks) to put in place Board approved policy on lending to Micro and Small Entrepreneurs (MSEs),
adopting an appropriate system of timely and adequate credit delivery to borrowers in the MSE segment
within the broad prudential regulations of the Reserve Bank.

• The Reserve Bank, on August 27, 2015 enhanced the limit for cash withdrawal at Point of Sale (POS -for
debit cards and open system prepaid cards issued by banks in India) from ₹ 1000/- to ₹ 2000/- per day in
Tier III to VI centres. Customer charges, if any, levied on cash withdrawals shall not exceed one per cent of
the transaction amount at all centres irrespective of the limit of ₹1000 / ₹ 2000.

• The Reserve Bank announced the designation of State Bank of India and ICICI Bank Ltd. as Domestic
Systemically Important Banks (D-SIBs) on August 31, 2015.

September 2015

• As a part of continuous assessment of the effectiveness of the Framework for Revitalizing Distressed
Assets in the Economy and review of its guidelines on Joint Lenders’ Forum (JLF) and Corrective Action
Plan (CAP), as also based on the feedbacks received from banks, the Reserve Bank on September 24,
2015 introduced certain changes/additions in the framework pertaining to Joint Lenders’ Forum
Empowered Group (JLF – EG); Restructuring of Doubtful Accounts under JLF; Disagreement on
Restructuring as CAP and Exit Option; Duration of Application of Extant Penal Provisions and Strategic
Debt Restructuring Scheme, to make it more effective.

• The Reserve Bank, on September 16, 2015, granted “in-principle” approval to ten applicants to set up
small finance banks under the “Guidelines for Licensing of Small Finance Banks in the private sector”
issued on November 27, 2014.

• In order to streamline the existing processes and to obviate the need to approach the Reserve Bank on
case-to-case basis, the Reserve Bank on September 16, 2015, permitted commercial banks to grant loans
and advances to the Chief Executive Officer/ Whole Time Directors, without seeking prior approval of the
Reserve bank, subject to certain conditions.

• The Reserve Bank on September 24, 2015, put into circulation banknotes in the denominations of Rs.
500 and Rs. 1000 incorporating three new/revised features - (i) ascending size of numerals in the number
panels, (ii) bleed lines, and (iii) enlarged identification mark.

• The Reserve Bank, on September 24, 2015, allowed scheduled commercial banks (excluding RRBs), all-
India term-lending and refinancing institutions (Exim Bank, NABARD, NHB and SIDBI) to upgrade the
credit facilities extended to borrowing entities whose ownership has been changed outside Strategic Debt
Restructuring Scheme (SDR), to ‘Standard’ category upon such change in ownership, subject to the certain
conditions laid down in the Guidelines, including change in ownership of the borrowing entities.

• The Reserve Bank, on September 29, 2015 placed a framework for issuance of Rupee denominated
bonds overseas within the overarching ECB policy.

October 2015

• The Reserve Bank, on October 6, 2015 announced a Medium Term Framework (MTF) for Foreign
Portfolio Investors (FPIs) limits in Government securities.

• The Reserve Bank, on October 15, 2015 advised Primary (Urban) Co-operative Banks/ State and Central
Co-operative Banks on the constitution of the Financial Inclusion Fund, on merger of Financial Inclusion
Fund (FIF) and Financial Inclusion Technology Fund (FITF).

• The Reserve Bank, on October 20, 2015 invited applications for authorization from entities (from non-
bank entities and banks) currently engaged in bill payments and desirous of operating as Bharat Bill
Payment System Operating Units (BBPOUs) under the Bharat Bill Payment System (BBPS).

• The Reserve Bank, on October 22, 2015 directed all scheduled commercial banks (excluding regional
rural banks) on implementation of the Gold Monetization Scheme, 2015 (GMS) notified by the Central
Government.

November 2015

• The Reserve Bank, on November 5, 2015 allowed state cooperative banks (StCBs) and district central
cooperative banks (DCCBs) to extend the facility of internet banking to their customers.

• The Reserve Bank on November 19, 2015 issued revised Directions necessitating prior approval for
acquisition of shares or voting rights in private sector banks. The provisions of these Directions shall apply
to the existing and proposed “major shareholders” of the private sector banks and all private sector banks
including local area banks, licensed to operate in India.

• With a view to facilitating hedging of long term foreign currency borrowings by residents, the Reserve
Bank on November 19, 2015, permitted them to enter into foreign currency (FCY)-INR swaps with
Multilateral or International Financial Institutions (MFI/IFI) in which the Government of India is a
shareholding member subject to certain terms and conditions.
• The Reserve Bank, on November 24, 2015, granted ‘in principle’ approval to the National Payments
Corporation of India (NPCI) to function as the Bharat Bill Payment Central Unit (BBPCU) in Bharat Bill
Payment System (BBPS).

• The Reserve Bank on November 24, 2015 granted “in-principle” approval to three applicants, namely,
NSE Strategic Investment Corporation Limited (NSICL) and Small Industries Development Bank of India
(SIDBI), Mumbai, Axis Bank Limited, Mumbai and Mynd Solutions Pvt. Ltd., Gurgaon, Haryana, to set up
and operate Trade Receivables Discounting System (TReDS).

December 2015

• The Reserve Bank on December 17, 2015, announced the Marginal Cost of Funds Methodology for
Interest Rate on Advances.

• The Reserve Bank on December 10, 2015, introduced exchange traded option contracts in the currency
pairs of EUR (Euro)-USD (US Dollar), GBP (Pound Sterling)-US Dollar and US Dollar –JPY (Japanese
Yen).

The year 2015 witnessed some changes in the conduct of monetary policy and the changes were :

• On February 20, 2015, the Government of India and the Reserve Bank signed an agreement on the
Monetary Policy Framework.

• The agreement makes price stability the primary objective of monetary policy; defines price stability
numerically - below 6 per cent CPI inflation for 2015-16 (to be achieved by January 2016) and 4 +/- 2 per
cent for all subsequent years; sets out what will constitute a failure in achieving the target; and specifies
that the Reserve Bank in the event of failure will report to the government on: (a) reasons for deviation of
inflation from the target over three consecutive quarters, (b) remedial measures, and (c) an estimated time
frame over which inflation will be brought back to the target.

• Greater transparency on monetary policy necessitated release of Monetary Policy Reports (MPRs) -
released on April 2015 and then on September 2015.

• To create conditions for more effective transmission of monetary policy, the export credit refinance (ECR)
facility was replaced with the provision of system level liquidity with effect from February 7, 2015.

• A new liquidity management framework was put in place to ensure market-based liquidity operations
through auctions, while striving to ensure consistency of liquidity conditions with the stance of monetary
policy.

January 2016

Sovereign Gold Bonds 2015-16

The Government of India, in consultation with the Reserve Bank, on January 14, 2016, announced that the
Sovereign Gold Bonds, 2016 (“the Bonds”) will be open for subscription from January 18, 2016 to January
22, 2016. Scheduled commercial banks (excluding RRBs), designated Post Offices (as may be notified)
and Stock Holding Corporation of India Ltd (SHCIL) are authorised to receive applications for the Bonds
either directly or through agents. The terms and conditions of the issuance of the Bonds shall be as
follows:
Eligibility for Investment - The Bonds under this Scheme may be held by a person resident in India, being
an individual, in his capacity as such individual, or on behalf of minor child, or jointly with any other
individual. The bond may also be held by a Trust, Charitable Institution and University.

Form of Security - The Bonds shall be issued in the form of Government of India Stock and the investors
will be issued a Holding Certificate The Bonds shall be eligible for conversion into de-mat form. Date of
issuance shall be February 8, 2016.

Denomination - The Bonds shall be denominated in units of one gram of gold and multiples thereof.
Minimum investment in the Bonds shall be two grams with a maximum limit of subscription of five hundred
grams per person per fiscal year (April – March).

Issue Price - Price of the Bonds shall be fixed in Indian Rupees on the basis of the previous week’s
(Monday – Friday) simple average closing price for gold of 999 purity, published by the India Bullion and
Jewellers Association Ltd. (IBJA).

Interest - The Bonds shall bear interest at the rate of 2.75 percent (fixed rate) per annum on the amount of
initial investment. Interest shall be paid in half-yearly rests and the last interest shall be payable on maturity
along with the principal.

Payment Options - Payment shall be accepted in Indian Rupees through cash up to a maximum of
₹20,000/- or demand drafts or cheque (drawn in favour of receiving office) or electronic banking. The
investment in the Bonds shall be eligible for SLR.

Redemption - The Bonds shall be repayable on the expiration of eight years from February 8, 2016, the
date of issue of Gold bonds. Pre-mature redemption of the Bond is permitted from fifth year of the date of
issue on the interest payment dates. The redemption price shall be fixed in Indian Rupees on the basis of
the previous week’s (Monday – Friday) simple average closing price for gold of 999 purity, published by
IBJA.

Repayment - The receiving office shall inform the investor of the date of maturity of the Bond one month
before its maturity.

Loan against Bonds - The Bonds may be used as collateral for loans. The Loan to Value ratio will be as
applicable to ordinary gold loan mandated by the Reserve Bank from time to time. The lien on the Bonds
shall be marked in the depository by the authorised banks.

Tax Treatment - Interest on the Bonds shall be taxable as per the provisions of the Income-tax Act, 1961.
Capital gains tax treatment will be the same as that for physical gold.

The terms and conditions also include details on application, nomination, transferability, tradability of bonds
and commission for distribution.

RBI amends Gold Monetisation Scheme

The Reserve Bank on January 21, 2016, amended its Master Direction on Gold Monetisation Scheme. The
modifications have been made in consultation with Central Government to make the Scheme more
customerfriendly. The amended norms are:
• Gold deposits made by depositors in short-term bank deposits (STBD) scheme for a period of one-three
years would accrue interest in gold units. This is a change from the earlier norm where customers had a
choice of collecting their interest in cash or gold during the time of redemption.

• In the case of medium and long term gold deposits, where medium term deposits have a five-seven year
term and long-term deposits have a 12-15 year term, the interest will be calculated in rupees with reference
to the value of gold at the time of deposit while the principal will be denominated in gold.

• The depositors will now be able to withdraw medium term and long term government deposits pre-
maturely after the minimum lock-in period of three years in the case of medium term deposits and after five
years in the case of long term deposits. However, there will be penalty in the form of lower rate of interest
for premature withdrawals depending upon the actual period for which the deposit has run.

• In the case of large tenders of gold, gold can be deposited directly with refiners wherever they have the
assaying capacity. This will reduce the time lag between the time the raw gold is deposited and it starts
bearing interest.

• The Government will pay the participating banks a total commission of 2.5 per cent (1.5 per cent handling
charges and 1 per cent commission) in the first year.

The Scheme will be reviewed regularly based on feedback so as to address any implementation issue and
to make it more customer-friendly.

Banks can now offer Products through their ATMs

With a view to providing operational freedom to banks, the Reserve Bank on January 14, 2016, allowed
banks to offer all their products and services through the ATM channels provided the technology permits
offering the product and service, and adequate checks are put in place to prevent the channel from being
misused to perpetuate frauds on the banks/other genuine customers. Earlier, the Reserve Bank had
imposed certain restrictions on the facilities, which can be provided through off site ATMs of banks.

Roadmap for opening Brick and Mortar Branches in Villages

For increasing banking penetration and financial inclusion, the Reserve Bank on December 31, 2015,
advised SLBC Convenor banks to identify villages with population above 5000 without a bank branch of a
scheduled commercial bank in their State. The identified villages may be allotted among scheduled
commercial banks (including Regional Rural Banks) for opening of branches. The opening of bank
branches under this Roadmap should be completed by March 31, 2017.

The finalized roadmap with details of allocated villages to various banks should be submitted to the
respective Regional Office of the Reserve Bank as per the prescribed format latest by January 31, 2016.
Quarterly monitoring and review mechanism should be instituted by DCCs and SLBCs to evaluate the
progress under this roadmap. The SLBC Convener banks should arrange to furnish quarterly statement of
the district-wise, bank-wise progress in opening branches starting from quarter ended March 2016 by the
15th of the following month to the respective Regional Office of Financial Inclusion and Development
Department, Reserve Bank and also publish it on the respective SLBC website (s) as per the prescribed
format.
 February 2016

Modified Guidelines on Revitalizing Stressed Assets

On a review and based on feedback received from stakeholders, the Reserve Bank has partly
modified and also clarified, some aspects of its Prudential Guidelines for Revitalizing Stressed
Assets in the Economy. The salient features of the Review are as follows:

a. SDR:

 Reduction in the minimum percentage of shareholding to be initially divested by the lenders;

 Lenders to build up adequate provisions for possible loss in value of the equity acquired in lieu of
debt and residual loan exposures;

b. Framework to Revitalize the Distressed Assets in the Economy

 Reduction in the percentage of lenders, by number, required to approve the Corrective Action
Plan;
 Revised composition of the Joint Lending Forum- Empowered Group (JLF-EG) for enhancing the
quality of decision making;
 A scheme of incentives for adherence to timelines for decision-making by JLF members to
facilitate timely implementation of the Corrective Action Plan;

c. Restructuring of Advances

 Permitting restructuring and benefits of asset classification in cases of borrower accounts, which
were involved in fraud, where the promoters have been subsequently replaced by new promoters
and the borrower is totally delinked from the erstwhile promoters;
 Clarifying that Flexible Structuring of Project Loans is also permitted for ECBs;

Implementation of Indian Accounting Standards

The Reserve Bank on February 11, 2016 advised the scheduled commercial banks (excluding
regional rural banks) to follow the Indian Accounting Standards (Ind AS) as notified under the
Companies (Indian Accounting Standards) Rules, 2015, subject to any guideline or direction
issued by the Reserve Bank in this regard, in the following manner:

 Banks shall comply with the Indian Accounting Standards (Ind AS) for financial statements for
accounting periods beginning from April 1, 2018 onwards, with comparatives for the periods
ending March 31, 2018 or thereafter. Ind AS shall be applicable to both standalone financial
statements and consolidated financial statements.
 Banks shall apply Ind AS only as per the above timelines and shall not be permitted to adopt Ind
AS earlier.

Basel III Framework on Liquidity Standards

The Reserve Bank on February 11, 2016 permitted banks to reckon government securities held
by them up to another three per cent of their Net Demand and Time Liabilities (NDTL) under
Facility to Avail Liquidity for Liquidity Coverage Ratio (FALLCR) within the mandatory Statutory
Liquidity Ratio (SLR) requirement as Level 1 High Quality Liquid Assets (HQLAs) for the purpose
of computing their Liquidity Coverage Ratio (LCR). This is in addition to the assets allowed to
banks as the Level 1 HQLAs for the purpose of computing the LCR of banks. Hence, the total
carve-out from SLR available to banks would be 10 per cent of their NDTL. For this purpose,
banks should continue to value such reckoned government securities within the mandatory SLR
requirement at an amount not greater than their current market value (irrespective of the category
of holding the security)

Legal Guardianship Certificates - Mental Health Act

The Reserve Bank on February 11, 2016, clarified that banks need to necessarily seek
appointment of a guardian only in such cases where they are convinced on their own or based on
documentary evidence available, that the concerned person is mentally ill and is not able to enter
into a valid and legally binding contract. Further, the Reserve Bank clarified that banks need not
mandatorily insist on appointment of a guardian as a matter of routine from every person “who is
in need of treatment by reason of any mental disorder”. The clarifications were issued after
receiving feedback that banks are insisting on guardianship certificate from all mentally ill
persons

Settlement of Export/ Import Transactions in Currencies

To further liberalise the procedure and facilitate settlement of export and import transactions
where the invoicing is in a freely convertible currency and the settlement takes place in the
currency of the beneficiary, which though convertible, does not have a direct exchange rate, the
Reserve Bank on February 4, 2016 permitted authorised dealer category-I banks to settle such
export and import transactions (excluding those put through the ACU mechanism), subject to
certain conditions.

Monitoring of Frauds in NBFCs

The Reserve Bank on February 18, 2016 revised the threshold for reporting of frauds and
submission of quarterly progress reports on frauds to Central Fraud Monitoring Cell, Reserve
Bank of India, Department of Banking Supervision, from ₹ 25 lakh as on date to ₹ one crore with
immediate effect.

Interest Equalization Scheme

The Reserve Bank on February 11, 2016, advised scheduled urban cooperative banks holding
authorised dealer category I licenses which are eligible under the Interest equalization Scheme
on Pre and Post Shipment Rupee Export Credit to eligible exporters Scheme to adhere to
prescribed operational procedure for claiming reimbursement, particularly the procedure for
passing on the benefit of interest equalization to exporters, and procedure for claiming
reimbursement of interest equalization benefit already passed on to eligible exporters.

Relaxations for Start-ups

To facilitate ease of doing business, the Reserve Bank on February 11, 2016, issued certain
clarifications relating to acceptance of payments in case of start-ups, as under:
 A start-up in India with an overseas subsidiary is permitted to open foreign currency account
abroad to pool the foreign exchange earnings out of the exports/sales made by the concerned
start-up;
 The overseas subsidiary of the start-up is also permitted to pool its receivables arising from the
transactions with the residents in India and non-residents abroad into the said foreign currency
account opened abroad in the name of the start-up;
 The balances in the said foreign currency account as due to the Indian start-up should be
repatriated to India within a period as applicable to realization of export proceeds (currently nine
months);
 A start-up is also permitted to avail of the facility for realizing the receivables of its overseas
subsidiary or making the above repatriation through Online Payment Gateway Service Providers
(OPGSPs) for value not exceeding USD 10,000 or up to such limit as may be permitted by the
Reserve Bank of India from time to time under this facility; and
 To facilitate the above arrangement, an appropriate contractual arrangement between the start-
up, its overseas subsidiary and the customers concerned should be in place.

March 2016

RBI amends Basel III Capital Regulations

On a review of the existing capital adequacy guidelines, the Reserve Bank on March 1, 2016 made
some amendments to the treatment of certain balance sheet items for the purposes of determining
banks’ regulatory capital. The review was carried out with a view to further aligning the definition
of regulatory capital with the internationally adopted Basel III capital standards, issued by the
Basel Committee on Banking Supervision (BCBS). The salient features of the amendments were:
Treatment of Revaluation Reserves Revaluation reserves arising from change in the carrying
amount of a bank’s property consequent upon its revaluation would be considered as common
equity tier 1 capital (CET1) at a discount of 55 per cent instead of Tier 2 capital as earlier, subject
to following conditions: • Bank is able to sell the property readily at its own will and there is no
legal impediment in selling the property; • The revaluation reserves are shown under Schedule 2:
Reserves & Surplus in the Balance Sheet of the bank; • Revaluations are realistic and in
accordance with Indian Accounting Standards; • Valuations are obtained, from two independent
valuers, at least once in every three years; where the value of the property has been substantially
impaired by any event, these are to be immediately revalued and appropriately factored into
capital adequacy computations; • The external auditors of the bank have not expressed a qualified
opinion on the revaluation of the property. Treatment of Foreign Currency Translation Reserves
Foreign Currency Translation Reserves (FCTR) arising due to translation of financial statements
of a bank’s foreign operations to the reporting currency may be considered as CET1 capital at a
discount of 25 per cent subject to meeting the following conditions: • The FCTR are shown under
Schedule 2: Reserves & Surplus in the Balance Sheet of the bank; • The external auditors of the
bank have not expressed a qualified opinion on the FCTR. Treatment of Deferred Tax Assets (i)
Deferred Tax Assets (DTAs) associated with accumulated losses and other such assets should be
deducted in full from CET1 capital.

(ii) DTAs arising due to timing differences (other than those related to accumulated losses) may
be recognised as CET1 capital up to 10 per cent of a bank’s CET1 capital at the discretion of
banks.
Interest Rates on Deposits and Advances

The Reserve Bank on March 3, 2016 issued the Master Directions (MD) on Interest Rates on
Deposits and Advances. While the Master Directions on Interest Rates on Deposits is applicable
to all scheduled commercial banks (including RRBs) accepting deposits in rupee and foreign
currency, the Master Directions on Interest Rates on Advances are applicable to all scheduled
commercial banks (excluding RRBs), granting rupee and foreign currency advances to their
customers.

Instructions on Liquidity Risk Management revised

The Reserve Bank on March 23, 2016 revised certain instructions on measuring Liquidity Risk
Management for Basel III norms, in view of recent developments, feedback received from the
stakeholders and experience gained. Some of the revised norms included: • The time buckets in
Statements of Structural Liquidity (SLS) statement with Liquidity Coverage Ratio (LCR)
monitoring requirement have been amended; • The time buckets in Dynamic Liquidity statement
with LCR monitoring requirement have been amended; • In addition to the assets prescribed under
Level 2B, with effect from February 1, 2016, Corporate debt securities (including commercial
paper) can also be reckoned as Level 2B high-quality liquid asset (HQLAs) subject to a 50 per
cent haircut and the securities having usual fundamental and market related characteristics for
HQLAs and meeting certain conditions;

Grant of EDF Waiver for Export of Goods Free of Cost

The Reserve Bank on March 3, 2016 advised Authorised Dealer (AD) Category – I banks to
consider requests from status holder exporters for grant of Export Declaration Form (EDF)
waiver, for export of goods free of cost based on the revised norm. Government of India, had
earlier revised the norm and notified that the status holders would be entitled to freely export
exportable items on free of cost basis for export promotion subject to an annual limit of `10 lakh
or 2 per cent of average annual export realisation during preceding three licensing years
whichever is lower

Data on NEFT Transactions of Walk-in Customers

From the quarter ending March 31, 2016, members banks do not need to submit data pertaining to
National Electronic Funds Transfer (NEFT) transactions by walk-in customers (those not having
an account with the bank). The Reserve Bank may, however, call for adhoc reports regarding the
data for NEFT transactions by walkin customers as and when required. Hence, banks may
continue to maintain such data at their end.

Framework for Revival and Rehabilitation of MSMEs

The Reserve Bank in consultation with the Ministry of Micro, Small and Medium Enterprises,
Government of India, on March 17, 2016 has formulated a “Revised Framework for Revival and
Rehabilitation of Micro, Small and Medium Enterprises (MSMEs)” along with operating
instructions. The objective is to make the Framework and the operating instructions, compatible
with the existing regulatory guidelines on ‘Income Recognition, Asset Classification and
provisioning pertaining to Advances’ issued by the Reserve Bank. The Reserve Bank further
advised banks to put in place the Board approved policy to operationalise the Framework not later
than June 30, 2016. While the prudential norms on Income Recognition, Asset Classification and
 Provisioning pertaining to Advances will continue to be as per the instructions consolidated in the
Master Circular on IRAC Norms dated July 1, 2015 and as updated from time to time, the revival
and rehabilitation of MSMEs having loan limits up to ` 25 crore will be in terms of these operating
instructions. Restructuring of loan accounts with exposure of above ` 25 crore will continue to be
governed by the extant guidelines on Corporate Debt Restructuring (CDR) / Joint Lenders’ Forum
(JLF) mechanism.

Pradhan Mantri Fasal Bima Yojana

The Reserve Bank has conveyed the Pradhan Mantri Fasal Bima Yojana to the commercial banks
on March 17, 2016. The scheme aims at providing insurance cover to farmers.

Risk Weights assigned to Sovereign Debt revised

The Reserve Bank on March 10, 2016, advised all deposit accepting NBFCs, systemically
important non-deposit taking NBFCs, all NBFCMFIs and all NBFC-IFCs regarding the revised
risk weights assigned to exposures to domestic sovereigns, as under: a) Exposures to Central
Government i. Fund-based and non-fund based claims on the Central Government will attract a
zero risk weight. ii. Central Government guaranteed claims will attract a zero risk weight. b)
Exposures to State Government i. Direct loan/ credit/ overdraft exposure and investment in State
Government securities will attract zero risk weight. ii. State Government guaranteed claims,
which have not remained in default, will attract 20 per cent risk weight. However, if the loans
guaranteed by the State Government have remained in default for a period of more than 90 days, a
risk weight of 100 per cent should be assigned.

Minimum Capital Adequacy Norms for StCBs/DCCBs

The Reserve Bank on March 10, 2016 permitted State and Central Cooperative Banks
(StCBs/DCCBs) to include the following items under Tier I capital: i. Contributions received from
associate / nominal members where the bye-laws permit allotment of shares to such members and
provided there are restrictions on withdrawal of such shares as applicable to regular members. ii.
Contribution / non-refundable admission fees collected from the nominal and associate members
which are held separately as ‘Reserves’ under appropriate head since these are not refundable. iii.
Outstanding amount in Special Reserve created under Section 36(1) (viii) of the Income Tax Act,
1961 if the bank has created Deferred Tax Liability (DTL) on this Reserve.

Participation of Standalone PDs in Currency Futures Market

The Reserve Bank on March 10, 2016 permitted State and Central Cooperative Banks (StCBs/DCCBs) to
include the following items under Tier I capital:

i. Contributions received from associate / nominal members where the bye-laws permit allotment of shares to
such members and provided there are restrictions on withdrawal of such shares as applicable to regular
members.
ii. Contribution / non-refundable admission fees collected from the nominal and associate members which are
held separately as ‘Reserves’ under appropriate head since these are not refundable.
iii. Outstanding amount in Special Reserve created under Section 36(1) (viii) of the Income Tax Act, 1961 if
the bank has created Deferred Tax Liability (DTL) on this Reserve.
 First Bi-monthly Monetary Policy Statement, 2016-17

Monetary and Liquidity Measures

On the basis of an assessment of the current and evolving macroeconomic situation, it has been decided
to:

 reduce the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points from 6.75 per
cent to 6.5 per cent;
 reduce the minimum daily maintenance of the cash reserve ratio (CRR) from 95 per cent of the
requirement to 90 per cent with effect from the fortnight beginning April 16, 2016, while keeping the CRR
unchanged at 4.0 per cent of net demand and time liabilities (NDTL);
 continue to provide liquidity as required but progressively lower the average ex ante liquidity deficit in the
system from one per cent of NDTL to a position closer to neutrality; and
 narrow the policy rate corridor from +/-100 basis points (bps) to +/- 50 bps by reducing the MSF rate by 75
basis points and increasing the reverse repo rate by 25 basis points, with a view to ensuring finer
alignment of the weighted average call rate (WACR) with the repo rate;

Consequently, the reverse repo rate under the LAF stands adjusted to 6.0 per cent, and the marginal
standing facility (MSF) rate to 7.0 per cent. The Bank Rate which is aligned to the MSF rate also stands
adjusted to 7.0 per cent.

Assessment

Since the sixth bi-monthly statement of February 2016, global economic activity has been quiescent.
Perceptions of downside risks to recovery in some advanced economies (AEs) at the beginning of 2016
have eased, while major emerging market economies (EMEs) continue to contend with weak growth and
still elevated inflation amidst tighter financial conditions. World trade remains subdued due to falling import
demand from EMEs and stress in mining and extractive industries. In the US, consumer spending was
underpinned by a strengthening labour market, but flagging exports proved to be a drag on growth in Q4
and cloud the near-term outlook. In the Euro area, tailwinds in the form of aggressive monetary policy
accommodation and still low energy prices have supported activity in an environment beset with
uncertainties from the migrant crisis, intensifying stress in the banking sector, and possible Brexit. While
Japan escaped recession in Q4 of 2015, a combination of weak consumer spending, business investment
and exports has slowed the economy in Q1 of 2016. In China, sluggish industrial production, contracting
exports, capital outflows and substantial excess capacity in factories and the property market remain
formidable headwinds, notwithstanding significant monetary and fiscal policy stimulus. EME commodity
exporters have benefited recently from the firming up of commodity prices and risk-on investor sentiment
has appreciated their currencies. Across EMEs, however, weak domestic fundamentals, lacklustre external
demand and country-specific constraints continue to restrain growth.

Effective April 2, 2016 the statutory liquidity ratio (SLR) of scheduled commercial banks was reduced by 25
basis points from 21.5 per cent to 21.25 per cent of their NDTL. Also, from February 2016, banks were
allowed to reckon additional government securities held by them up to 3 per cent of their NDTL within the
mandatory SLR requirement as level 1 high quality liquid assets (HQLA) for the purpose of computing their
liquidity coverage ratio (LCR), thereby taking the total carve-out from SLR available to banks equivalent to
10 per cent of their NDTL. These measures will create space for banks to increase their lending to
productive sectors on competitive terms so as to support investment and growth.

Rationalisation of Branch Authorisation Policy: Currently, banks provide services through a variety of
business outlets – branches; extension counters; satellite offices; mobile branches; ultra small branches
and the like. The current policy approach is to facilitate adequate outreach of banking outlets in unbanked
areas while at the same time providing autonomy to banks to decide their business strategy. Given that
regulations are written in terms of branches, with a view to facilitating financial inclusion and providing
 flexibility on the choice of delivery channel, it is proposed to redefine branches and permissible methods of
outreach keeping in mind the various attributes of the banks and the types of services that are sought to be
provided.

Differentiated Licensing of Banks: In addition to recently licensed differentiated banks such as payments banks and
small finance banks, the Reserve Bank will explore the possibilities of licensing other differentiated banks such as
custodian banks and banks concentrating on whole-sale and long-term financing. A paper in this regard will be put out
for comments by September 2016.

Cyber Risks - Supervisory Assessment of Preparedness of Banks: The Reserve Bank has commenced detailed
examination of IT used by banks on a pilot basis during the current year. IT examination reports are being issued
separately so as to strengthen the information security preparedness of banks as well as to assess the effectiveness of
IT adoption by banks. Moving forward, it is planned to cover major banks in 2016-17 and all banks from 2017-18. The
Reserve Bank has constituted an Expert Panel (Chairperson: Smt. Meena Hemachandra) on IT Examination and
Cyber Security to provide broad guidance on its approach.

Review of Guidelines for Commercial Paper (CP): With a spurt in the issuance of CPs, market participants and the
Fixed Income Money Market and Derivatives Association (FIMMDA) have expressed the need for greater transparency
and better dissemination of information. Accordingly, it is proposed to undertake a comprehensive review of guidelines
with the objective of, inter alia, strengthening disclosure requirements by issuers of CPs, reviewing the role of issuing
and paying agents (IPAs) and putting in place an information dissemination mechanism. Draft guidelines in this regard
will be issued by end-July 2016 for wider feedback.

Initiatives for Start-ups: In the Sixth Bi-Monthly Monetary Policy Statement for 2015-16 and the press release dated
February 2, 2016 the Reserve Bank had highlighted the steps being taken with respect to the Government’s initiatives
to promote ease of doing business for start-ups. Guidelines/clarifications have already been issued in areas such as
online submission of Form A2 for outward remittances up to certain thresholds, issue of shares without cash payments
and acceptance of payments by the Indian start-ups on behalf of their overseas subsidiaries. In addition, guidelines in
respect of deferred payment through escrow/ indemnity arrangement for transfer of shares, enabling investment by
foreign venture capital investors (FVCIs) in start-ups and overseas investment operations for start-ups will be issued
soon in consultation with the Government. Furthermore, the simplification of process for dealing with delayed reporting
of FDI transactions and provisions for an enabling external commercial borrowing regime for start-ups are being
examined by the Government and the Reserve Bank.

Strengthening Business Correspondent (BC) Infrastructure: The BC model offers significant scope for further
strengthening. Accordingly, the following initiatives are proposed:

i. In order to ensure the competence of BCs and to promote quality delivery of financial services, a graded
certification/training programme for BCs is proposed to be introduced. This would enable BCs with a good track record
and advanced training to be entrusted with more complex tasks such as handling/delivery of financial products that go
beyond deposit and remittance. The Reserve Bank will issue the necessary framework for establishing a certification
programme for BCs by end-June 2016. Based on the framework, the Indian Banks’ Association (IBA) will be requested
to put in place a system of training and certification of BCs in coordination with external training institutes.
ii. In order to have a tracking system of BCs, it is proposed to create a registry covering all BCs, both existing and new.
The registration will be online and will capture basic details including location of fixed point BCs, nature of operations
and the like. This database will be updated on a quarterly basis. The necessary enabling framework would be issued
by the Reserve Bank by end-June 2016 and the IBA will be requested to put in place a registry of BC agents in
consultation with all stakeholders.

Micro, Small and Medium Enterprises (MSMEs): The Reserve Bank will lay down a framework by September 2016
for accreditation of credit counsellors who can act as facilitators for entrepreneurs to access the formal financial system
with greater ease and flexibility. Credit counsellors will also assist MSMEs in preparing project reports in a
professional manner which would, in turn, help banks make more informed credit decisions.
 Sixth Bi-Monthly Monetary Policy Statement, 2015-16

Monetary and Liquidity Measures

On the basis of an assessment of the current and evolving macroeconomic situation, it has been decided
to:

 keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.75 per cent;
 keep the cash reserve ratio (CRR) of scheduled banks unchanged at 4.0 per cent of net demand and time
liability (NDTL);
 continue to provide liquidity under overnight repos at 0.25 per cent of bank-wise NDTL at the LAF repo rate
and liquidity under 14-day term repos as well as longer term repos of up to 0.75 per cent of NDTL of the
banking system through auctions; and
 continue with daily variable rate repos and reverse repos to smooth liquidity.

Consequently, the reverse repo rate under the LAF will remain unchanged at 5.75 per cent, and the
marginal standing facility (MSF) rate and the Bank Rate at 7.75 per cent.

Assessment

Since the fifth bi-monthly statement of December 2015, global growth has slowed, with the ongoing
weakening of activity in major emerging market economies (EMEs) outweighing the recovery in some
advanced economies (AEs). World trade has remained subdued, held down by anaemic demand, new
lows in commodity prices and currency realignments. In the United States, an improving labour market
continues to support a consumption-led recovery. Manufacturing activity is sluggish, however, reflecting
retrenchment in oil and gas drilling activity and declining exports. In the Euro area, improving labour market
and financing conditions are supporting consumer spending and business investment. Although core
inflation and wage growth are subdued, deflation risks appear to be receding. In Japan, the combination of
exceptional monetary accommodation and fiscal stimulus has failed to spur sustainable domestic demand
so far. In China, growth in Q4 of 2015 was the slowest since 2009, pulled down by manufacturing,
residential investment and exports. EME commodity exporters confront recessionary conditions, falling
currencies, sluggish exports and still high inflation relative to their recent histories.

The December calm in global financial markets – suggesting that the normalization of US monetary policy
was fully anticipated – was dispelled in January 2016 by fears of further weakening of the Chinese
economy and the depreciation of the Renminbi. Capital outflows from China triggered sell-offs across AEs
and EMEs, exacerbating currency declines and heightening volatility. Crude oil prices fell below US $ 30
per barrel – a 12-year low –on expectations of Iran adding to the supply glut. Prices of gold prices and US
Treasuries hardened on safe haven demand. Financial markets remain vulnerable to bouts of volatility and
capital outflows from EMEs as an asset class. Bearish commodity price dynamics are also likely to impact
investor sentiment.

On the domestic front, economic activity lost momentum in Q3 of 2015-16, pulled down by slackening
agricultural and industrial growth. The north-east monsoon season ended in December with a deficiency of
23 per cent relative to the long period average (LPA). By end-January, rabi sowing was mildly deficient
relative to a year ago, as well as to the quinquennial average in respect of all crops, except coarse cereals.
Rural incomes will continue to be supported by allied activities such as dairy and horticulture, which now
contribute as much to GDP as food grains.
Manufacturing Sector

In the first two months of Q3 of 2015-16, industrial activity slowed in relation to the preceding quarter. This
mainly reflects weak investment demand with some deceleration of capital goods production. Stalled
projects continue to remain high, and there is a decline in new investment intentions, perhaps on the back
of low capacity utilization. While revenue growth in manufacturing has been modest, the fall in costs, partly
because of a decline in commodity prices, and partly because of improvements in manufacturing efficiency,
have resulted in relatively stronger profitability. The Reserve Bank’s industrial outlook survey suggests a
modest expansion of activity likely in Q4. In January 2016, the manufacturing purchasing managers’ index
(PMI) expanded to a four-month high on, inter alia, resumption of output by firms affected by the December
floods as well as on new domestic and export orders.

Service Sector

Lead indicators of the services sector are mixed. Construction activity is still tepid, as evidenced by weak
growth in cement production, though the pick-up in road construction bodes well for future activity,
especially if supported by construction in the major proposed industrial corridors. Railway freight growth is
still weak, though it may reflect lower transport needs for inputs like coal, and competition from roadways.
However, the services PMI rose to a ten-month high in December on improvement in new business orders
and upbeat expectations.

Retail inflation

Retail inflation measured by the consumer price index (CPI) rose for the fifth month in December across all
constituent categories. While the upturn in December essentially reflected unfavorable base effects, the
ongoing seasonal decline in prices of fruits and vegetables could temper headline inflation in the near-term.
Prices of cereals recorded modest increases despite the adverse monsoon, indicative of effective supply
management. On the other hand, pulses inflation continued to remain elevated, reflecting structural
mismatches.

CPI inflation excluding food and fuel rose for the fourth successive month. Excluding petrol and diesel from
this category, inflation remained flat. A breakdown into goods and services categories shows that while
goods inflation declined, services inflation has been sticky since September 2015 across housing, transport
and communication, medical and other services. Household inflation expectations remain elevated and the
rate of increase in corporate staff costs picked up. On the other hand, rural wage growth has been muted.

Liquidity Management

Liquidity conditions tightened in the second half of December with advance tax outflows. Tightness spilled
over into January 2016 on the back of a seasonal pick-up in demand for currency, restrained spending by
the government and a pick-up in bank credit growth, in relation to deposit mobilisation. In order to mitigate
these conditions, the Reserve Bank injected liquidity through variable rate term repos of varying tenors
ranging from overnight to 56 days, besides provision through the regular liquidity windows. The average
daily liquidity injection (including variable rate overnight and term repos) increased from Rs. 1,200 billion in
December to about Rs. 1,345 billion in January. In addition, the Reserve Bank also injected Rs.200 billion
through open market purchase operations on December 7 and January 20. In response, money market
rates remained close to the policy rate with a marginal downside bias. Bank credit in the form of personal
loans and non-bank flows from both domestic and foreign sources grew strongly.

India’s exports remained in contraction mode for the thirteenth successive month in December, although
there are indications of a sequential bottoming out. In volume terms too, the rate of decline appears to be
moderating. While softer petroleum, oil and lubricants (POL) and commodity prices helped to contain the
trade deficit, these benign effects were offset by a spike in the quantum of gold and POL imports. As a
consequence, the trade deficit widened during December in relation to preceding months, though the
overall current account deficit is likely to remain well contained and easily financed. Net foreign direct
investment (FDI) and non-resident deposits have remained robust in relation to last year. The persisting
decline in oil prices may, however, impact the flow of remittances from the Gulf region where fiscal
positions are deteriorating rapidly. Portfolio investment also recorded some outflows since November.
Nevertheless, as on January 22, 2016, foreign exchange reserves stood at US$ 347.6 billion – an
accretion of US$ 5.9 billion during the current financial year so far.

Policy Stance and Rationale

Inflation has evolved closely along the trajectory set by the monetary policy stance. With unfavourable
base effects on the ebb and benign prices of fruits and vegetables and crude oil, the January 2016 target
of 6 per cent should be met. Going forward, under the assumption of a normal monsoon and the current
level of international crude oil prices and exchange rates, inflation is expected to be inertial and be around
5 per cent by the end of fiscal 2016-17. However, the implementation of the VII Central Pay Commission
award, which has not been factored into these projections, will impart upward momentum to this trajectory
for a period of one to two years. The Reserve Bank will adjust the forecast path as and when more clarity
emerges on the timing of implementation. Vagaries in the spatial and temporal distribution of the monsoon
and the impact of adverse geo-political events on commodity prices and financial markets add additional
uncertainty to the baseline.

Prospects for the rabi harvest are improving slowly. The near-term outlook for industrial activity may be
constrained by adverse base effects in Q4 and still weak exports, although the pick-up in corporate
profitability on the back of declining input costs may provide an offset. Some categories of services are
likely to gain momentum on expectations of higher activity in coming months, though the aggregate state of
activity remains muted. On balance, therefore, GVA growth for 2015-16 is kept unchanged at 7.4 per cent
with a downside bias.

For 2016-17, growth is expected to strengthen gradually, notwithstanding significant headwinds.

Expectations of a normal monsoon after two consecutive years of rainfall deficiency, the large positive
terms of trade gain, improving real incomes of households and lower input costs of firms should contribute
to strengthening the growth momentum. Yet, still weak domestic private investment demand in a phase of
balance sheet adjustments, re-emergence of concerns relating to stalled projects, excess capacity in
industry, sluggish external demand conditions dampening export growth could act as headwinds. Based on
an assessment of the balance of risks, GVA growth for 2016-17 is projected at 7.6 per cent.

In keeping with the Government’s Start-up India initiative, the Reserve Bank will take steps to ease doing
business and contribute to an ecosystem that is conducive for growth of start-ups. These measures will
create an enabling framework for receiving foreign venture capital, differing contractual structures
embedded in investment instruments, deferring receipt of considerations for transfer of ownership, facilities
for escrow arrangements and simplification of documentation and reporting procedures. A detailed
statement is being issued separately.

The current momentum of growth is reasonable, though below what should be expected over the medium
term. Underlying growth drivers need to be rekindled to place the economy durably on a higher growth
trajectory. The revival of private investment, in particular, has a crucial role, especially as the climate for
business improves and fiscal policy continues to consolidate. The Indian economy is currently being
viewed as a beacon of stability because of the steady disinflation, a modest current account deficit and
commitment to fiscal rectitude. This needs to be maintained so that the foundations of stable and
sustainable growth are strengthened. The Reserve Bank continues to be accommodative even as it leaves
the policy rate unchanged in this review, while awaiting further data on the development of inflation.
Structural reforms in the forthcoming Union Budget that boost growth while controlling spending will create
more space for monetary policy to support growth, while also ensuring that inflation remains on the
projected path of 5 per cent by the end of 2016-17.

Economic Survey 2015-16

Before Union Budget (29th February 2016), the Finance Minister Arun Jaitley today (26th February 2016)
tabled the Economic Survey 2015-2016 in Lok Sabha, which outlines the broad direction of the Budget and
the economic performance of the country. It has been revealed that GDP growth rate in India is seen in
range of 7 to 7.75 per cent in 2016-17 (it expects Indian economy to grow 7-7.5 percent in the fiscal year to
March 2017). The Economic Survey, the basis for Arun Jaitley’s budget for the fiscal year starting April 1,
projected India to grow 8 percent in the next couple of years. The survey was prepared by the finance
ministry’s chief economic adviser Arvind Subramanian. Following are the highlights of Economic Survey
2015-16.

Important Points

 GDP growth rate for 2015-16 to be in the range of 7% to 7.75 %

 Fiscal deficit of 3.9 pc achievable

 Inflation rate pegged at 4.5 to 5 pc

 Current account deficit seen around 1-1.5% of GDP

Highlights of the survey

 India haven of stability amidst gloomy global landscape.

 Crude oil prices to be about USD 35 a barrel next fiscal, as against USD 45 this year.

 Low inflation takes hold, price stability has increased.

 Pay Commission implementation not to destabilize prices.

 Challenging external environment to cast shadow on economic policies.

 Subsidy bill to be below 2% of GDP next fiscal.

 Concerned over delay in GST Bill.

 Balance sheets of corporate, banks remain stressed; need 4Rs: Recognition, Recapitalization,
Resolution and Reform.

 Suggests revival of domestic demand as foreign capital outflow likely.

 Sees good performance by industrial, infrastructure, corporate sectors due to recent reform.

 More investment in health, education; focus on agriculture.

 Government tax revenues to be higher than budgeted.

 Exports slowdown to continue; pick up in next fiscal.

 India should resist protectionist measures in trade.

 Suggests reform package for fertilizer sector.

 GDP growth next fiscal to be between 7-7.75%

 Current account deficit at 1-1.5%, forex reserves at USD 351.5 bn in mid-Feb.

 PSU banks’ capital need at Rs 1.8 lakh crore by FY19.

 3.9% fiscal deficit target achievable this year, coming year to be challenging.

 Proposes widening of tax net from 5.5% of earning individuals to more than 20%

 Services sector growth in 2015-16 seen at 9.2%

 Projects retail inflation at 4.5-5% for 2016-17.

 Growth this fiscal to be 7.6%, long-term potential at 8-10% if exports grow rapidly.

ECONOMIC SURVERY HIGHLIGHTS 2016

FISCAL DEFICIT
 India has decided to meet its medium-term fiscal deficit target of 3 percent of GDP

 Government is planning to reduce its to fiscal deficit target of 4.1 percent of GDP in 2014/15

 Government is also planning to curb its expenditure control to reduce fiscal deficit

 It is also focusing on the Expenditure control and expenditure switching to investment key

GROWTH
 In the year 2015-16 GDP growth is expected to seen at over 8 percent per annum

 Double digit economic growth trajectory now a possibility

 Economic growth at market prices seen between 8.1 – 8.5 percent in 2015-16 on new GDP calculation
formula. It is yet to be achieved.

 Total stalled projects are projected at about 7 percent of GDP, mostly in private sector

Some REFORMS
 There is scope for big bang reforms now according to the government.

 According to the survey, India can increase public investments and still hit its borrowing targets

INFLATION
Inflation is the general price rise and it is important to curb it for any economy. It is required by the
government of India to curb the inflation if it wants the smooth functioning of the economy and the
enhanced foreign investment in the country. It is committed to take the following steps as mentioned in the
economic survey to improve the health of inflation in the country and how it can curb that in the coming
financial year.
 According to the government and survey, Inflation shows declining trend in 2014-15

 Inflation likely to be below central bank target by 0.5 – 1 percentage point for the WPI inflation

 Lower inflation opens up space for more monetary policy easing

 Government and central bank need to conclude monetary framework pact to consolidate gains in
inflation control

 Consumer inflation in 2015/16 likely to range between 5-5.5 percent

FISCAL CONSOLIDATION
It is an act on how the government can control the excess expenditure to reduce the gap between te
revenue and the expenditure of the movement it is planning to take the following steps to improve the fiscal
consolidation in the country.
 Government remains committed to fiscal consolidation

 Outlook for external financing is correspondingly favorable according to the government

 India can balance short-term imperative of boosting public investment to revitalize growth with fiscal
discipline

CURRENT ACCOUNT DEFICIT

It also considers the debts that the government has been paying on various loans that it has borrowed from
the foreign banks and entities.
 According to survey, government Estimated CAD at about 1.3 percent of GDP in 2014-15 and less than
1.0 percent of GDP in 2015-16. It is yet to achieve.

SUBSIDIES
 Government is planning to reduce the subsidies on various items that it is currently paying to reduce
the deficit and improve its revenue.

LIQUIDITY
According to the government and survey, the liquidity conditions in the country are well enough for the
country for the coming financial year 2015-16.

KEY FEATURES OF BUDGET 2016-17

Mission 'Transform India'

Finance Minister Jaitley declared that the NDA government's agenda is to 'Transform India' by increasing
expenditure in the farm and rural sectors, the social sector, the infrastructure sector and infuse funds into
PSBs in order to alleviate the pressure due to mounting NPAs. He also promised to effect several including
legislative, transportation, banking and financial reforms.
The Transform India mission includes the following nine categories:
1. AGRICULTURE & FARMER'S WELFARE
a) Total allocation for agriculture and farmers' welfare is Rs.35,984 crore. The government will strive
to double the income of farmers by 2022.
b) A total of 28.5 lakh hectares will be brought under irrigation under the 'Pradhan Mantri Krishi Sinchai
Yojana'
c) Implementation of 89 irrigation projects under AIBP will be fast-tracked and a dedicated Long Term
Irrigation Fund will be created in NABARD.
d) Rs.60000 crore for groundwater recharging to enable water conservation in drought-hit areas.
e) Implementation of 'Parmparagat Krishi Vikas Yojana' and 'Organic Value Chain Development in North-
East Region' in order to promote organic farming.
f) A sum of Rs.19,000 crore will be allocated under the Pradhan Mantri Gram Sadak Yojana to
connect the remaining 65,000 eligible habitations by laying 2.23 lakh kms of roads by 2019.
g) To reduce the burden of loan repayment on farmers; a provision of Rs.15,000 crore towards interest
subvention.
h) Under the Pradhan Mantri Fasal Bima Yojana Rs.5,500 crore has been allocated.
2. RURAL SECTOR:
a) For overall rural development Rs.87,765 crore has been allocated.
b) As per the recommendations of the 14th Finance Commission, Rs.2.87 lakh crore will be given
to Gram Panchayats and municipalities.
c) Under the Shyama Prasad Mukherjee Rurban Mission, 300 Rurban clusters will be developed.
d) A new Digital Literacy Mission Scheme for rural India will cover around 6 crore additional households
within the next 3 years.
e) New scheme called Rashtriya Gram Swaraj Abhiyan has been proposed with an allocation of Rs.655
crore to enable Panchayats to gain governance abilities.
3. SOCIAL SECTOR INCLUDING HEALTHCARE :
a) Allocation for social sector, including education and health care is Rs.1,51,581 crore.
b) Rs.2,000 crore allocated for initial cost of providing LPG connections to BPL families.
c) New health protection scheme will provide health cover up to Rs.1 lakh per family.
d) A total of 3,000 stores for generic drugs will be established under the Prime Minister's Jan Aushadhi
Yojana.
e) Stand Up India Scheme to benefit at least 2.5 lakh entrepreneurs.
f) For the Swachch Bharaat Abhiyan, Rs.9000 crore has been provided.
g) A sum of Rs.38,500 crore allocated for MGNREGS.
4. EDUCATION SKILLS AND JOB CREATION:
a) A total of 62 Navodaya Vidyalayas will be opened.
b) Higher Education Financing Agency to be established with an initial capital base of Rs.1000 crore.
c) Digital Depository for School Leaving Certificates, College Degrees, Academic Awards and Mark
sheets to be set-up.
d) Rs.1804 crore will be allocated for skill development.
e) Provision of Rs.1,700 crore to set up 1500 Multi Skill Training Institutes.
f) National Board for Skill Development Certification to be setup through Massive Open Online Courses.
g) The government will pay the Employee Pension Scheme contribution of 8.33% for of all new
employees enrolling in EPFO for the first three years of their employment.
5. INFRASTRUCTURE AND INVESTMENT
a) Total outlay for infrastructure in the budget is Rs.2,21,246 crore.
b) Including the Pradhan Mantri Gram Sadak Yojana (for which the total investment is Rs.27,000
crore), the total investment in the road sector will be Rs.97,000 crore. A sum of Rs.55,000 crore has
been allocated for roads and highways.
c) The government is likely to approve 10,000 kms of national highways (NHs) this year and 50,000 kms
of state highways will be converted to NHs.
d) The government plans to develop new greenfield ports in the eastern and western coasts of India.
e) The Motor Vehicles Act will be amended.
f) Action plan for revival of unserved and underserved airports to be drawn up in collaboration with state
governments.
g) Reforms in FDI policy in the areas of Insurance and Pension, Asset Reconstruction Companies, Stock
Exchanges.
h) 100% FDI to be allowed in marketing of food products manufactured in India.
i) Steps to revitalise the PPP model:
● Public Utility (Resolution of Disputes) Bill will be introduced this fiscal year.
● Guidelines for renegotiation of PPP Concession Agreements will be issued.
● New credit rating system for infrastructure projects to be introduced.
6. FINANCIAL SECTOR REFORMS
a) A comprehensive 'Code on Resolution of Financial Firms' to be introduced providing a resolution
mechanism to tackle bankruptcy across financial institutions.
b) The RBI Act of 1934 will be amended to create a statutory basis for a Monetary Policy Framework and
a Monetary Policy Committee through the Finance Bill 2016.
c) The SARFAESI Act of 2002 will be amended. The SEBI Act of 1992 will also be amended to increase
members and benches of the Securities Appellate Tribunal.
d) A total of Rs.25,000 crore will be infused in PSBs.
e) Target amount sanctioned under Pradhan Mantri Mudra Yojana increased to Rs. 1,80,000 crore.
f) General Insurance companies will be listed in the stock exchange.
7. GOVERNANCE AND EASE OF DOING BUSINESS
a) A Task Force has been constituted for rationalisation of human resources in various Ministries.
b) The government will introduce a bill for Targeted Delivery of Financial and Other Subsidies, Benefits
and Services by using the Aadhar framework.
c) Automation facilities will be provided in 3 lakh fair price shops by March 2017.
d) Amendments in the Companies Act of 2013 to improve enabling environment for start-ups.
e) Price Stabilisation Fund with a corpus of Rs.900 crore will be instituted to help maintain stable prices
of essential commodities like pulses.
f) "Ek Bharat Shreshtha Bharat" programme will be launched to bring together states and districts in an
annual programme that will connect people through exchange of language, trade, culture, travel and
tourism.
8. FISCAL DISCIPLINE
a) Fiscal deficit in RE 2015-16 and BE (budget estimates) 2016-17 have been retained at 3.9% and 3.5%
of GDP respectively.
b) Revenue deficit target has improved from 2.8% to 2.5% in RE 2015-16.
c) Total expenditure of the Budget has been projected at Rs.19.78 lakh crore.
d) Additional funds will be mobilised by NHAI, PFC, REC, IREDA, NABARD and Inland Water Authority
through bonds.
e) Plan and Non-Plan classification of public expenditure will be done away with from 2017-18.
f) The government has restructured over 1500 Central Plan Schemes into about 300 Central Sector and
30 Centrally Sponsored Schemes.
g) A committee will be set up to review implementation of the FRBM Act as the global economy is
presently marked by uncertainty.
9. TAX PROPOSALS: I-T slabs unchanged
The major focus of this year's tax proposals fell under nine categories, including providing relief to small tax
payers, incentivising domestic value addition to help Make in India, using technology to create
accountability, among others. Let us now look at the important points as regards taxation plans for 2016-
17:
-No changes have been made to existing income tax slabs
-Infrastructure and agriculture cess to be levied. 0.5 per cent Krishi Kalyan Cess to be levied on all
services.
- Pollution cess of 1% to be levied on small petrol, LPG and CNG cars; 2.5% on diesel cars of certain
specifications and 4% on premium model cars.
- Tax rebate for those earning less than Rs.5 lakh per annum has been increased from Rs.2000 to
Rs.5000.
- For those who do not own a house, the limit of deduction of rent paid has been increased to Rs.60,000
per annum.
- The tax surcharge for individuals with over Rs.1 crore income per annum has been raised from 12
to 15% percent.
- Necessary changes will be made in customs and excise duty rates to give impetus to the 'Make in India'
programme.
- Companies with a revenue below Rs.5 crore will be taxed at 29% plus surcharge.
- Exemption of Rs.50,000 for housing loans up to Rs.35 lakh, so long as cost of house is not above Rs.50
lakh.
- No service tax will be imposed on construction of affordable houses up to 60 sq. m. under state and
Central housing schemes.
- A total of 13 cess imposed by various ministries amounting to a revenue collection of less than Rs.50
crore will be phased out.
- Customs Act to provide for deferred payment of customs duties for importers and exporters with proven
track record.
- Free baggage allowance will be increased for international passengers. Filing of baggage will be
mandatory only for those carrying dutiable goods.
- 'e-Sahyog' to be expanded to reduce compliance cost, especially for small taxpayers.

Overall
- FY17 fiscal deficit target retained at 3.5%
Direct Tax for individuals
- No change in tax slabs
- Limit of deduction of rent paid under section 80GG raised to Rs 60,000 per annum from Rs 24,000
- Deduction for additional interest of Rs 50,000 per annum for loans up to Rs 35 lakh sanctioned in 2016-
17 for first time home buyers, where house cost does not exceed Rs 50 lakh
- Only 40% of EPF/NPS total corpus withdrawn at the time of retirement will be tax exempt. The remaining
60% will be tax exempt only if invested in annuities. The proposal is not finalized and government has
clarified that tax will be applied only on the interest earned and will not be applicable to individuals with
basic income of upto 15,000 per month
Indirect/Service Tax
- Krishi Kalyan Cess, @ 0.5% on all taxable services, effective 1st June 2016
Financial Sector
- Allocation of Rs 25,000 crore towards re-capitalisation of PSBs(Public Sector Banks)
- General Insurance Companies owned by the government to be listed in the stock exchanges
Make-in-India/Start-up India
- New manufacturing companies incorporated on or after 1.3.2016 to be given an option to be taxed at 25%
+ surcharge and cess provided they do not claim profit linked or investment linked deductions
- 100% deduction of profits for 3 out of 5 years for startups setup during April, 2016 to March, 2019
Automotive
- An infrastructure cess of 1 percent on small petrol, LPG, CNG cars, 2.5 percent on diesel cars of certain
capacity and 4 percent on other higher engine capacity vehicles and SUVs has been levied.
Black Money
- Domestic taxpayers can declare undisclosed income by paying tax at 30%, and surcharge at 7.5% and
penalty at 7.5%, which is a total of 45% of the undisclosed income
Farmers/Agriculture
- Around Rs 36,000 crore to be allotted to agriculture and farmer welfare
- Provision of Rs 15,000 crore to reduce burden of loan repayment on farmers
- Rs 5500 crore to be provided towards crop insurance scheme
Rural Sector/Villages
- Around Rs 88,000 crore to be allotted to rural sector
- Rs 38,500 crore to be allotted to rural employment guarantee scheme
- Every village in the country to have electricity by May 1, 2018
Social/Healthcare/Education
- Social sector, including healthcare and education to get Rs 1.51 lakh crore
Infrastructure
- Total investment in the road sector, including highways and village roads to be Rs 97,000 crore
 FINANCIAL RESULTS FOR THE QUARTER ENDED 31ST DECEMBER 2015

PERFORMANCE HIGHLIGHTS

 Total Business at Rs 9.41 Lac Crore grew yoy by 11.2%.

o Global Deposits at Rs 5.48 Lac Crore grew yoy by 13.3%
o CASA Share to Domestic Deposits more than 40%.
o Total Advances at Rs 3.93 Lac Crore grew yoy by 8.4%.
o Share of Small Ticket Advances over 60% of Non Food credit - Retail grew by 17.6%, MSME by
13.3% and Agriculture by 13.2% on yoy basis.
 Operating Profit stood at Rs 2918 Crore in Q3 FY16 growing yoy by 6.1%.
 Cost of Deposit declined to 5.81% in Q3 FY16 from 6.11% in Q3 FY15.
 NIM stood at 2.87% during 9M FY16.

NETWORK

 Bank’s domestic branch network stands at 6692 (Excluding extension counters) with network of
ATMs at 8884 more than the number of branches. Number of Business Correspondents stood at
8316 as on 31.12.2015.

INTERNATIONAL FORAYS

 Bank is having 4 overseas branches, 2 in Hong Kong, 1 in Dubai and 1 Offshore Banking Unit in
Mumbai and 4 Representative Offices (RO) at Dubai, Shanghai, Sydney and Dhaka.
 Bank has two overseas subsidiaries viz. PNB International Ltd. –UK and Druk PNB Bank Ltd, One
associate company viz. JSC SB PNB Kazakhstan and one Joint Venture Bank in Nepal i.e Everest
Bank Ltd.

BUSINESS

Total Business of the Bank amounted to Rs 941468 Crore as on December 31, 2015 registering a yoy
growth of 11.2 % over corresponding period last year.

Deposits

 Total Deposits of the Bank recorded a yoy growth of 13.3% to Rs. 548531 Crore as on Dec’
15.
 CASA deposits increased to Rs.197922 Crore in Dec’15 recording a yoy growth of 14.3%.
Domestic CASA share has improved to 40.38% as on Dec’ 15 from 39.44% in Dec’ 14. The
share is one of the highest among nationalized banks.
 Saving deposits increased by 12.5% on yoy basis to Rs 161460 Crore.

Advances

 Net Advances increased to Rs. 392937 Crore registering a yoy growth of 8.4% as on Dec’
2015.
 In line with Bank’s objective to achieve profitable growth from the grassroots, share of small
ticket advances to Non food credit increased to 60.3% in Dec’15 from 57% in Dec’14.
 Retail loans were at Rs 54351 Crore as on Dec’15, growing 17.6% on yoy basis over Rs
46215 Crore in Dec’14. Housing loan grew yoy by a robust 26.8% to Rs 25061 Crore in Dec’
2015.
 MSME Advances increased to Rs. 92004 Crore in Dec’15 from Rs. 81231 Crore as at Dec’14
showing yoy growth of 13.3%.
 Agriculture advances at Rs 60132 Crore has shown yoy growth of 13.2% as on Dec’15.

Priority Sector
 Bank has achieved the Priority Sector (PS) Advances target at 44.08% against the National
Goal of 40% with PS Advances growing to Rs 150605 Crore growing yoy by 19.63% as on
31.12.2015. Bank’s total outstanding to Small and Marginal Farmers within Agriculture is
8.26% of ANBC against a target of 8% of ANBC.
 Micro, Small & Medium Advances

 Credit to Micro & Small Enterprises grew by 15% to Rs 72283 Crore as on 31.12.2015.
 Credit to Micro enterprises amounted to Rs.27704 Crore showing yoy growth of 12.8%.
 Under Pradhan Mantri Mudra Yojana (PMMY), the Bank has opened 309747 accounts and
disbursed Rs 1758.8 Crore as on 31.12.2015.

PROFITABILITY

 Operating & Net Profit

 Operating Profit for Q3 FY’16 stood at Rs 2918 Crore as against Rs 2751 Crore in Q3 FY’15
growing yoy by 6.1%. Operating Profit for Nine Months ended December 2015 (9M FY 16)
stood at Rs 8988 Crore.
 Net Profit for the Quarter ended December 2015 (Q3 FY’16) stood at Rs 51 Crore. Net Profit
for 9M FY 16 amounted to Rs 1393 Crore.
 Income
 Total Income during Q3 FY’16 rose by 7.6% to Rs.13891 Crore from Rs 12905 Crore during
corresponding period last year. During 9M FY 16, Total Income rose by 5.9% to Rs.41025
Crore. Net Interest Income during Q3 FY’16 stood at Rs 4120 Crore. Net Interest Income
during 9M FY 16 stood at Rs 12544 Crore.
 Non-interest Income stood at Rs 1671 Crore in Q3 FY’16. During 9M FY16, Non-interest
Income stood at Rs 4425 Crore.

ASSET QUALITY

As on Dec’ 15, Gross NPA ratio stood at 8.47% and Net NPA ratio was at 5.86%. Provision Coverage
Ratio stood at 53.85% as on Dec’ 15. The increase in NPA is on account of Bank’s exercise as part of
RBI’s Asset Quality Review over the last two quarters of the current financial year. Bank is undertaking the
same over the timeframe stipulated by RBI.

FINANCIAL INCLUSION

PNB remains committed towards nation building and actively participated in all schemes launched by the
Govt.of India for financial & social empowerment of the masses.
 Under the PM Jan Dhan Yojana, Bank opened 123 lakh accounts and issued 99.6 lac RuPay
Cards as on 31.12.2015. Rs 1324 Crore have been mobilized in these accounts.
 Under three Social Security Schemes namely PM Jeevan Jyoti Bima Yojana, Suraksha Bima
Yojana and Atal Pension Yojana, Bank enrolled around 66 lac beneficiaries as on 31.12.2015.
 No of transactions through BC channel have increased to 186 Lakh in Dec 15 against 22 lakh in
Dec’ 14.

MOVE TOWARDS DIGITALIZATION

 Bank is moving towards digitalization and number of new age digital initiatives have been
introduced to provide greater ease and improved delivery of products and services to customers.
Concerted efforts are on to increase usage of Alternate Delivery Channels which account for
around 58% of transactions.

NEW PRODUCTS/INITIATIVES

 Mobile App based Banking - ‘PNB Mobiease’ and ‘ATM Assist’, - for a complete SMS Banking
solution and ATM related queries, respectively.
 Online Opening of PPF, RD & Saving A/cs introduced in Internet Banking (IBS).
 ‘PIN @ last’ for enhanced ATM security.
 ‘Green PIN Model ‘ adopted for setting duplicate PIN for Debit Card.
 Launch of ‘Bulk note acceptor cum ATM’ a highly efficient multifunction kiosk.
 A new scheme PNB- Vanita for financing women for income generating activities with a special
preference to women under SC / ST & BPL category.

AWARDS & ACCOLADES

 ABP News Brand Excellence Awards 2015 under Banking Financial Services and Insurance
Category
  Best Bank Award for PMJDY ( Large Bank)- Winner by CIMSME- Banking Excellence Awards
2015
 Inspiring Work Place Awards 2015 under the category Best HR and Talent Management Practices
- Banking Frontiers
 Agriculture Leadership Award 2015 - Agriculture Today Group
 Best MSME Bank ( Large Bank)-Runners Up- CIMSME- Banking Excellence Awards 2015
 PNB is ranked 1st among PSBs in the overall list of 'Most Respected Companies‘ by BW Business
World Survey 2015; overall ranking being 51st.

PROVISIONAL FIGURES AS ON 31.03.2016

31.3.15 30.6.15 30.9.15 31.12.15 31.3.16 Growth(Yo

Parameter Y)
(Rs. Crore)
Bal. Sheet Bal. Sheet Bal. Sheet Bal. Sheet Prov. 31.03.15 31.03.16
Global 881913 898613 920882 941468 978209 10.1 10.9
Business
Domestic 781128 791688 809127 827202 865528 7.4 10.8
Business
Overseas 100785 106925 111755 114266 112680 37.2 11.8
Business
Global 501379 517733 539924 548531 554333 11.1 10.6
Deposits
Current 33581 31938 36863 36462 35709 6.6 6.3
Deposits
Savings 150200 149555 157683 161460 170243 6.2 13.3
Deposits
CASA 183780 181493 194546 197922 205952 -4.3 12.1
Deposits
Net 380534 380880 380958 392937 423876 9.0 11.4
Advance
s
Gross 334141 330043 330314 342506 382665 6.8 12.9
Non Food
Cr.
 GENERAL BANKING

THE BANKING REGULATION ACT, 1949

An act to consolidate and amend the laws relating to banking
Came in to force w.e.f.16.03.1949. The act was passed as “The Banking companies
Act, 1949” and later on the name changed to “The Banking Regulation Act, 1949, w.e.f.
01.03.1966.
Extends to the whole country (made applicable to the J&K in 1956)..
The act is not applicable to primary agricultural credit societies, cooperative land
mortgage banks and non-agricultural primary credit societies.
Salient provisions of the act are as under:-

Section Summary of salient provisions

5 Contains definition of Banking, Banking Company , secured loans or advances -
Banking means accepting for the purpose of lending or investment, of deposits of
money from the public, repayable on demand or otherwise, and withdrawal by
cheque, draft, order or otherwise.

Banking Company: means any company which transacts the

business of banking in India

Secured loan or advance: means a loan or advance made on the security of

asset the market value of which is not at any time less than the amount of such
loan or advance, and ‘unsecured loan or advance’ means a loan or advance not
secured.
6 Describes the forms of business in which a banking company may
engage in addition to the Banking Business.
7 Use of Word Banking: Banking company carrying on banking
business in India to use at least one word, bank, banker, banking, or
banking company in its name.
8 Prohibition of trading: restricts/prohibits business like trading for goods etc.
9 Holding of Immovable Property (other than for own Use):
No Banking company shall hold any immovable property howsoever acquired
except as is acquired for its own use for a period exceeding 7 years from the
date of acquisition. RBI can further grant extension for a period not exceeding 5
years.
11 Requirement as to minimum paid up Capital and Reserves
Domestic Banks – Min. – Rs. 5 lac
Foreign Banks - Min. - Rs.15 lac (Rs.20 lac for business in Mumbai
or Kolkatta)
12 Regulation of paid up capital, subscribed capital and authorized capital and
voting rights
Subscribed capital should not be less than ½ of its authorized capital
Paid up capital should not be less than ½ of its subscribed capital
(i.e. ratio of authorized capital, subscribed and paid up capital should be minimum
4:2:1)
No person shall have voting rights in excess of 10% of total voting rights of all the
shareholders.

17 Every banking company to create reserve fund and 20% of its profits should be
transferred to this fund before any dividend is declared. (RBI has directed the
banks to transfer not less than 25% of net profits to Reserve Funds). The
appropriation of any sum from the reserve fund or share premium account is to be
reported to Reserve Bank, within 21 days from date of appropriation.
18 Cash Reserve: Non scheduled banks to maintain 3% of the demand and time
 liabilities by way of cash reserves with itself or by way of balance in a Current
Account with RBI.
19 Permits bank to form subsidiary company for certain purposes (vide section
6)
19(2) No banking company shall hold shares in any company, whether as pledgee,
mortgagee or absolute owners of an amount exceeding 30% of its own paid up
share capital + reserves or 30% of the paid up share capital of that company
whichever is less.
20 Restrictions on loans and advances:
Banks cannot grant loans against security of their own shares

21 Empowers the RBI to issue directives to banks to determine policy for

advances
21A Rate of interest charged by banks shall not be reopened by any court on the
ground that the rate of interest charged by banks is excessive
22 Empowers RBI to issue license for opening a bank.
23 Empowers RBI to grant license for opening of branches
24 Statutory Liquidity Ratio--Every bank has to maintain liquid assets in form of
cash, gold & unencumbered approved securities at the close of any business
which is minimum of certain percentage (Presently 24%,{wef. 08.11.08} of its
total demand and time liabilities in INDIA as on last Friday of the second preceding
fortnight. (Minimum SLR is as per RBI discretion now, as against 25% earlier.
Maximum is 40%)
26 Return of unclaimed deposits (10 years and above) within 30 days of close of
each calendar year
29 Every bank to prepare its Balance Sheet as on last working day of March every
year on Form `A’ and profit and loss a/c on Form `B’ of the 3rd schedule of the Act.
30(I) Balance Sheet should be got audited from qualified auditors
31 To publish Balance Sheet and Auditors report within 3 months from the end of
period to which they refer.
RBI may extend the period by further 3 months
45Z Returning a paid instrument to a customer after keeping true copy.
45(ZA to Nomination Facility
ZF)

RESERVE BANK OF INDIA ACT 1934

Established on 1st April, 1935, under RBI Act, 1934 on the recommendations of John
Hilton Young Commission (known as Royal Commission on Indian Currency & Finance)
Nationalized on Jan. 1, 1949
Paid up capital – Rs. 5 crore
Management – Managed by a Central Board of Directors – (one Governor, 4 Dy.
Governors & 15 other Directors) and 4 Local Boards (at Mumbai, Chennai, Kolkatta &
New Delhi)
1st Governor – Mr. O Smith, 1st Indian Governor – Dr. C Desmukh, Present Governor –
Dr. Raghuram Rajan

Functions:

A) Issuance of Currency (Section 22 of RBI Act)

Sole authority to issue currency notes of various denominations under signatures of
Governor (except One rupee note, which is issued by Central Govt. under Signature of
Finance Secretary).

B) Banker to the Government

RBI transacts Govt. business & manages debt U/s 20 of RBI Act (for Central Govt. & U/s
21-A (for State Govt.), advises Govt. on monetary policy matters, provides ways and
 means advance (U/s 17(5) of RBI Act) to Govt. (Central / State) for meeting temporary
mismatch / shortfall in revenue.

C) Banker’s Bank
Acts as a banker to the Scheduled banks and the lender of the last resort by providing
financial assistance by way of refinance / rediscounting (Sec 17 (2) & (3) and Liquidity
Adjustment Facility (injection of liquidity through repo auctions & absorption of liquidity
through reverse repo auctions).

D) Controller of Banks
Grants licence to carry on banking business, issue directions, carries out inspection
(onsite as well as off site) and exercises management control.

E) Controller of Credit
U/s 21 & 35A of Banking Regulations Act, RBI can fix interest rates (including Bank rate)
and also exercises selective credit controls in order to control inflation and money supply
for ensuring growth of economy and price stability.
Various methods used by RBI for this purpose are:
Change in Cash Reserve Ratio,Statutory Liquidity Ratio
Stipulation of margin on securities
Directed credit guidelines
Open market operations (Sale and purchase of securities).

F) Collection of Information
RBI collects information on borrowers enjoying credit limits up to Rs.10 lac on secured
basis & Rs. 5 lac on unsecured basis (u/s 45C) and shares this information with other
Banks (Sec. 45-D). It also collects information on BSR
(Basic Statistical Return); BSR-I – Part A: Containing particulars of borrowal a/cs enjoying
credit limits above Rs. 2 lac, Part B: aggregate figures of limits of Rs.2 lac and less), -
BSR-II (containing information on deposits with break up in to current, Savings and term
deposits) & also the information on suit filed accounts and willful defaulters.

G) Managing Payment System

Acts as a regulator of payment & settlement system, manages cheque clearing system
(introduced Magnetic Ink Character Recognition System (MICR), Cheque truncation
system, Electronic Clearing Service (ECS), National Electronic Fund Transfer (NEFT),
Real Time Gross Settlement (RTGS) system for faster cheque clearance / settlement.

H) Maintenance of value of Indian currency

RBI maintains and regulates foreign exchange transactions under the Foreign Exchange
Management Act (FEMA).

I) Supervision of Financial System

Board for Financial Supervision (BFS) has been set up u/s 58 of RBI Act on 16.11.1994,
with Governor, RBI as its ex-officio Chairman. Its functions include empanelment and
selection of statutory auditors and exercise of integrated supervision over commercial
banks. Financial Institutions & NBFCs and other para-banking financial institutions
through onsite inspection & off-site supervision through DSB Returns (eight Returns,
DSB-I is monthly return, DSB-VIII is daily return of structured liquidity) & other returns are
quarterly returns.
(Salient Provisions of Some Important Sections )

Sec. 17 Defines various types of business which RBI may transact which include:
i. Accepting deposits of Central / State Governments free of interest
ii. Purchase Purchase/rediscount of Bills of Exchange from banks.
iii. Purchase/sale of Foreign Exchange to/from banks
iv. To give loans to banks, SFCs, etc.
v. To provide advances to Central/State Governments.
vi. To purchase/sale Government securities, etc.
 Sec. 18 Grant of Emergency loan to banks on liberal terms
Sec. 19 Specifies business which RBI may not transact
Sec. 20 Banker to Govt.- Obligation of the Bank to transact Govt. business
Sec. 21 Confers right to transact govt. business in India
Sec.22 Exclusive right to issue bank notes.
Sec.24 Denomination of bank note may be maximum Rs.10, 000/-. Central Govt. may
direct discontinuance or non-issuance to bank note of any denomination
Sec.28 RBI can frame rules for refunding value of mutilated, soiled or imperfect notes as a
matter of grace.
Sec. 29 Bank note exempted from stamp duty under Indian Stamp Act
Sec.31 No Body other than RBI or Central Government is authorized to issue promissory
note payable to bearer on Demand. Similarly, except RBI and Central Government,
no body is authorized to draw/accept / make or issue Bills of Exchange payable to
bearer on demand (Exception: Cheques payable to bearer on demand can be drawn
by anybody).
Sec.33 Assets of the Issue department shall consist of gold coins, gold bullion and foreign
securities which will not be less than Rs.200 cr. at any time, of which gold coin and
bullion will not be less than Rs.115 crore.
Sec. 42 Maintenance of CRR by scheduled banks.
Sec. 45C Power to call for credit information from banks.
Sec. 48 Exemption to RBI from paying income tax and super tax
Sec. 49 Publication of Bank Rate. Standard rate at which RBI is prepared to buy or
rediscount bills of exchange or other commercial papers eligible for purchase under
this Act. Current rate is 6% (w.e.f. 29.4.03)
Sec. 58 RBI’s Central Board is empowered to make regulations consistent with the Act.
CASH RESERVE RATIO

With a view to monitoring compliance of maintenance of statutory reserve requirements viz.

Cash Reserve Ratio and Statutory Liquidity Ratio by the Scheduled Commercial Banks
(SCBs), the Reserve Bank of India has prescribed statutory returns i.e.Form A return (for
CRR) under Section 42 (2) of the RBI Act, 1934 and Form VIII return (for SLR) under
Section 24 of the Banking Regulation Act, 1949. These guidelines applicable to all Scheduled
Commercial Banks excluding Regional Rural Banks.

The Reserve Bank In terms of Section 42 (1) of the Reserve Bank of India Act, 1934 having
regard to the needs of securing the monetary stability in the country, prescribes the
CRR for Scheduled Commercial Banks (SCBs) without any floor or ceiling rate.

CRR & SLR AT A GLANCE

CRR SLR
Statutory basis Sec. 42 (1) of RBI Act, 1934 Sec. 24 (2.a) of Banking Regulation Act,
1949
Minimum and RBI Discretion Minimum :RBI discretion
maximum percentage Maximum :40%
to NDTL
Rate 4.0% 21.5%
How maintained Cash balance with RBI Cash in hand, Gold/ investment in
approved Govt. Securities / net Bank
balance with scheduled commercial banks
Basis for computation %age of NDTL on fortnightly average %age of NDTL on daily basis on last
basis. (Min. 70% of average balance Friday of 2nd preceding fortnight
to be maintained on daily basis)
Interest No interest payable w.e.f. 31.3.2007 According to class of securities in which
investment is made
Penal interest for
default – 1st day 3% p.a. above bank rate 3% p.a. above bank rate
Next day 5% p.a. above bank rate 5% p.a. above bank rate
Return to RBI Form A (fortnightly) Form VIII (by 20th every month)
 SOME IMPORTANT RATES as on 07.03.2016 (Source RBI SITE)
Bank Rate 7.00% (w.e.f. 05.04.16)
Repo Rate 6.50% (w.e.f. 05.04.16)
Reverse Repo Rate 6.00% (w.e.f. 05.04.16)
MSF Rate 7.00% (w.e.f. 05.04.16)
CRR 4.00% (w.e.f. 09.02.13)
SLR 21.25% (w.e.f. 02.04.16)
Base rate (PNB) 9.60% (w.e.f. 01.10.15)

RBI announces Marginal Cost of Funds Methodology for Interest Rate on Advances

The highlights of the guidelines are as under :

i. All rupee loans sanctioned and credit limits renewed w.e.f. April 1, 2016 will be priced with
reference to the Marginal Cost of Funds based Lending Rate (MCLR) which will be the
internal benchmark for such purposes.
ii. The MCLR will be a tenor linked internal benchmark.
iii. Actual lending rates will be determined by adding the components of spread to the MCLR.
iv. Banks will review and publish their MCLR of different maturities every month on a pre-
announced date.
v. Banks may specify interest reset dates on their floating rate loans. They will have the option to
offer loans with reset dates linked either to the date of sanction of the loan/credit limits or to the
date of review of MCLR.
vi. The periodicity of reset shall be one year or lower.
vii. The MCLR prevailing on the day the loan is sanctioned will be applicable till the next reset date,
irrespective of the changes in the benchmark during the interim period.
viii. Existing loans and credit limits linked to the Base Rate may continue till repayment or renewal, as
the case may be. Existing borrowers will also have the option to move to the Marginal Cost of
Funds based Lending Rate (MCLR) linked loan at mutually acceptable terms.
ix. Banks will continue to review and publish Base Rate as hitherto.
 NEGOTIABLE INSTRUMENTS ACT 1881

Came into force w.e.f. March 01, 1882.

It has 147 sections and 17 chapters
This Act is applicable to entire India.

. MEANING OF NEGOTIABLE INSTRUMENT

As per Sec. 13 of the Act, Negotiable Instruments (NI) means and includes promissory note, bill
of exchange and cheque payable to order or bearer. Bank Draft finds mention in Sec-85(a) of NI
Act.

Apart from the aforesaid instruments defined in the NI Act, following instruments satisfy the
features of Negotiable Instruments.

Sr. Instrument Possessing feature of

No.
i Certificate of Deposit A promissory note
ii Commercial Paper A promissory note
iii Treasury Bill a promissory note
iv Share warrant a cheque
v Dividend warrant a cheque

Also u/s 137 of Transfer of Property Act, documents of title to goods are also negotiable, which
include:

Bill of lading Railway Receipts

Dock warrant Warehouse receipt
GRs approved by IBA Wharfinger Certificate

SECTION PARTICULARS
NO.
1 Short title
2 Repeal of enactments
3 Interpretation clause
4 "Promissory note
5 "Bill of exchange"
6 "Cheque"
7 "Drawer", "drawee"
8 Holder
9 "Holder in due course"
10 "Payment in due course"
11 "Inland instrument"
12 "Foreign instrument"
13 "Negotiable instrument"
14 Negotiation
15 Endorsement
16 Endorsement "in blank" and "in full"-"endorsee"
17 Ambiguous instruments
18 Where amount is stated differently in figures and words
19 Instruments payable on demand
20 Inchoate stamped instruments
21 At sight, On presentment, After sight
22 "Maturity"
23 Calculating maturity of bill or note payable so many months after date or sight
24 Calculating maturity of bill or note payable so many days after date or sight
25 When day of maturity is a holiday
26 Capacity to make, etc., promissory notes, etc.
27 Agency
28 Liability of agent signing
29 Liability of legal representative signing
30 Liability of drawer
31 Liability of drawee of cheque
32 Liability of maker of note and acceptor of bill
33 Only drawee can be acceptor except in need or for honor
34 Acceptance by several drawees not partners
35 Liability of endorser
36 Liability of prior parties to holder in due course
37 Maker, drawer and acceptor principals
38 Prior party a principal in respect of each subsequent party
39 Suretyship
40 Discharge of endorser's liability
41 Acceptor bound, although endorsement forged
42 Acceptance of bill drawn in fictitious name
43 Negotiable instrument made, etc. without consideration
44 Partial absence or failure of money-consideration
45 Partial failure of consideration not consisting of money
45A Holder's right to duplicate of lost bill
46 Delivery
47 Negotiation by delivery
48 Negotiation by endorsement
49 Conversion of endorsement in blank into endorsement in full
50 Effect of endorsement
51 Who may negotiate
52 Endorser who excludes his own liability or makes it conditional
53 Holder deriving title from holder in due course
54 Instrument endorsed in blank
55 Conversion of endorsement in blank into endorsement in full
56 Endorsement for part of sum due
57 Legal representative cannot by delivery only negotiate instrument endorsed by deceased
58 Instrument obtained by unlawful means or for unlawful consideration
59 Instrument acquired after dishonor or when overdue
60 Instrument negotiable till payment or satisfaction
61 Presentment for acceptance
62 Presentment of promissory note for sight
63 Drawee's time for deliberation
64 Presentment for payment
65 Hours for presentment
66 Presentment for payment of instrument payable after date or sight
67 Presentment for payment of promissory note payable by installments
68 Presentment for payment of instrument payable at specified place and not elsewhere
69 Instrument payable at specified place
70 Presentment where no exclusive place specified
71 Presentment when maker, etc., has no known place of business or residence
72 Presentment of cheque to charge drawer
73 Presentment of cheque to charge any other person
74 Presentment of instrument payable at demand
75 Presentment by or to agent, representative of deceased, or assignee of insolvent
76 When presentment unnecessary
77 Liability of banker for negligently dealing with bill presented for payment
78 To whom payment should be made
79 Interest when rate specified
80 Interest when no rate specified
81 Delivery of instrument on payment or indemnity in case of loss
82 Discharge from liability
83 Discharge by allowing drawee more than forty-eight hours to accept
84 When cheque not duly presented and drawer damaged thereby
85 Cheque payable to order
85A Drafts drawn by one branch of a bank on another payable to order
86 Parties not consenting discharged by qualified or limited acceptance
87 Affect of material alteration
88 Acceptor or endorser bound notwithstanding previous alteration
89 Payment of instrument on which alteration is not apparent
90 Extinguishment of rights of action on bill in acceptor's hands
91 Dishonor by non-acceptance
92 Dishonor by non-payment
93 By and to whom notice should be given
94 Mode in which notice may be given
95 Party receiving must transmit notice of dishonor
96 Agent for presentment
97 When party to whom notice given is dead
98 When, notice of dishonor is unnecessary
99 Noting
100 Protest
101 Contents of protest
102 Notice of protest
103 Protest for non-payment after dishonor by non-acceptance
104 Protest of foreign bills
104A When noting equivalent to protest
105 Reasonable time
106 Reasonable time of giving notice of dishonor
107 Reasonable time for transmitting such notice
108 Acceptance for honor
109 How acceptance for honor must be made
110 Acceptance not specifying for whose honor it is made
111 Liability of acceptor for honor
112 When acceptor for honor may be charged
113 Payment for honor
114 Right of payer for honor
115 Drawee in case of need
116 Acceptance and payment without protest
117 Rules as to compensation
118 Presumptions as to negotiable instruments Until the contrary is proved, the following
presumption shall be made
119 Presumption on proof of protest
120 Estoppel against denying original validity of instrument
121 Estoppel against denying capacity of payee to endorse
122 Estoppel against denying signature or capacity of prior party
123 Cheque crossed generally
124 Cheque crossed specially
125 Crossing after issue
126 Payment of cheque crossed generally
127 Payment of cheque crossed specially more than once
128 Payment in due course of crossed cheque
129 Payment of crossed cheque out of due course
130 Cheque bearing not negotiable
131 Non-liability of banker receiving payment of cheque
131A Application of chapter to drafts
132 Set of bills
133 Holder of first acquired part entitled to all
134 Law governing liability of maker, acceptor or endorser of foreign instrument
135 Law of place of payment governs dishonor
136 Instrument made, etc. out of India, but in accordance with the law of India
137 Presumption as to foreign law
Section 138 to 142 were added in 1988 (came into effect from 1.4.1989). Section 143 to 147
were added in Dec. 2002
138 Dishonor of cheque for insufficiency, etc., of funds in the accounts
139 Presumption in favor of holder
140 Defense which may not be allowed in any prosecution under section 138
141 Offences by companies
142 Cognizance of offences

143 Section 143 is intended to achieve speedy trial. By applying provisions of Sections 262 to
265 CrPC it enables a Judicial Magistrate or Magistrate of the First Class to conduct the
trial. Then it contemplates summary trial and provides for continuous day-to-day hearing
of the case till its conclusion and further stipulates that the trial is to be completed within 6
months from the date of filing of the complaint. It further empowers the Magistrate to pass
a sentence for imprisonment for a term not exceeding one year or a fine not exceeding
twice the amount of the cheque
144 Section 144 deals with the service of summons. It would now enable the Magistrate not to
follow the elaborate procedure for serving summons as required by Sections 61 to 90
CrPC.
145 Section 145 contemplates evidence on affidavit. According to this section the complainant
can give his evidence by way of an affidavit and the same may be attached with the
complaint and if the accused wants to contradict the contents of the affidavit the
complainant may be called for examination.
146 Section 146 provides for presumption to bank memorandums. Earlier whenever a question
arose whether there was insufficient funds in the account of the drawer of the cheque, it
was conceived to be a matter of evidence being a question of fact and onus was placed on
the complainant and for discharging this onus the bank personnel was to be examined. This
naturally delayed things. It has therefore been provided that based on the bank slip the
Court would presume the fact of dishonour, unless and until such fact is disproved.
147 Section 147 provides for compounding of offences under this Act. There was a difference
of opinion in different High Courts on the question whether offences under the provisions
of the Act were compoundable or not. The Kerala High Court's view was in the negative
whereas the view of the Andhra Pradesh High Court was in the affirmative. Unfortunately
the matter did not reach the Apex Court. Parliament therefore has resolved the controversy
and provided that offences under the Act would be compoundable.
GARNISHEE ORDER & ATTACHMENT ORDER: Obligation of the Bank to honour the
cheques issued by the customer (subject to fulfillment of certain conditions stipulated U/s sec.31
of NI Act) is not applicable when either a Garnishee Order or an attachment Order is received by
the bank.

GARNISHEE ORDER
A garnishee Order is an attachment order issued by a Court at the request of a creditor to attach
his debtor‟s fund in the hand of a banker. Garnishee means a debtor to the debtor and accordingly
the banker who holds the deposit balance of the debtor is called the garnishee, it is called a
garnishee order.

Statute
Issued under Section 60 of Code of Civil Procedure, 1908. The procedure for issuing a garnishee
order is laid down on Order 21, Rule 46 of the Code of Civil Procedure, 1908.
A Garnishee Order is issued in two stages, first as an Order Nisi and then an Order Absolute.
Order Nisi
An Order Nisi requires the banker to explain as to why the funds of the depositor should not be
attached towards satisfaction of the dues of the judgement creditor.
On receipt of an “Order Nisi” the bank is bound to stop operation in the depositor‟s account. He
must immediately inform the customer about the receipt of the order.

Order Absolute
o After receipt of the explanation from the bank the Court may issue “Order
Absolute”.
o On receipt of “Order Absolute”, the bank should pay the amount to the court.
o The production of passbook or deposit receipt is not necessary for making such
payment.
p
INCOME TAX ATTACHMENT ORDER Statutory Basis

Issued under Sec.226 (3) of Indian Income Tax Act, 1961, by an Income Tax Officer. Section
226(3). This section authorizes the ITO “to require, by notice in writing, any person from whom
money is due or may become due, to the assessee, or any person holds or may subsequently hold
money for or on account of assessee, to pay the Income Tax Officer an amount equal to the
amount of arrears of tax”.

Garnishee vis-à-vis I T attachment order

Garnishee vis-à-vis I T attachment order

Particulars Garnishee IT attachment order
Authority Court Revenue/Tax authority
Amount May be specific Must be specific, else it is a not
valid order.
Applicable amount At the time of receipt At the time of receipt and all
credits after receipt
Joint Accounts Not applicable Applicable pro-rata
Order Single name
Order Joint Names Applicable Applicable
Order in name of Partner, Not applicable Not applicable
Trustee, executor, director etc
Deceased accounts Applicable Applicable
Insolvents Not applicable Applicable
Undrawn CC or OD balances Not applicable Not applicable

Proceeds of cheques/Bills on Not attached Attached

collection
Future Credits Not attached Attached
Right to set off Available Available
Both received simultaneously Preference to attachment Preference to attachment being
or pending for payment being State dues. State dues

Limitation 12 Years being execution 30 years being Govt dues.

of decree

BANKER – CUSTOMER RELATIONSHIP:

Type of transaction Relationship

Bank Customer
1. Acceptance of Deposits Debtor Creditor
2 Loan from bank Creditor Debtor
3 Collection of cheque on behalf of customer Agent Principal
4 Sale/purchase of securities/shares on behalf of Agent Principal
customer
5 Safe Custody of articles Bailee Bailor
6 Safe deposit locker Lessor Lessee
( Licensor) (Licensee)
7 Payee of a Draft & Issuing Bank Trustee Beneficiary
8 Money tendered to bank pending Trustee Beneficiary
instruction for its disposal
9 Articles left by Mistake Trustee Beneficiary
10 Carrying on standing instruction Agent Principal

DIFFERENT TYPE OF CUSTOMERS

MINORS
 Minor is defined in Section 3 of Indian Majority Act, 1875 

 A minor (of Indian domicile) is a person who has not completed 18 years of age. 

 Even when a guardian is appointed by the Court (for the person, or property or both) or a
Court of ward is appointed as guardian a person attains majority on completion of 18 years
of age. 
MINOR’S AGREEMENT
 A minor is not competent to enter into a contract. All agreements with a minor are void ab-
initio (i.e. invalid from the very beginning) [Ref. Sec 11 of Indian Contract Act, 1872].
[Note: A contract for the supply of necessaries suitable to the life of a minor is, however,
 valid]. 
 In case a bank sanctions a loan, or opens deposit account in the name of a minor, it cannot
legally compel him to perform his part of the contract (since there cannot be a contract with
a minor). For this reason, banks never sanction loans/overdraft to minors. However, they
 open deposit accounts in the name of minors, after taking necessary precautions. As long as
the account is in credit, the banks run no risk in such accounts. 

 A person upon attaining majority cannot ratify a contract entered during his minority. Since a
 minor is incapable to contract, he can be represented by his lawful guardian. A lawful 
guardian, like a trustee, has the power to represent the minor in dealing with his property. He
has got a fiduciary relationship and can lawfully deal with this property only for the “benefit
of the minor”. 

WHO IS THE GUARDIAN OF A MINOR? 

 The guardian to a minor can be a: (a) Testamentary Guardian, or (b) Legal Guardian, or (c)
 Natural Guardian. 
Testamentary Guardian 

 Guardian appointed by the will of the minor's father is called testamentary guardian. 
 Such guardian acts only after the death of the father & mother of the minor child. Legal 

Guardian 

 Where there is no natural guardian, or testamentary guardian, the Court can appoint a
guardian i.e. legal guardian as per the provisions of Guardian and Wards Act, 1890. 

Natural Guardian 

In case of Hindus, the guardianship of minor is determined as per the provisions of Hindu
Minority & Guardianship Act, 1956.
 Section 6 of the Act provides that in case of a minor boy or unmarried girl, the father and
after his death the mother shall be the guardian of both person and property of the minor.
Opening of Fixed Deposit, Recurring & Savings Deposit account under the guardianship of
mother has been allowed by RBI (provided accounts are not allowed to be overdrawn). 

 After the death of both father and mother, a minor can be represented only through a legal
guardian. 

 Step father/step mother cannot act as natural guardian. 

 For a minor married girl, her husband (if major) is the natural guardian. In case the husband
is a minor, her father (or mother, if the father is dead) may continue to be natural guardian. 

 For a minor married girl, who has become a widow, her husband‟s father (mother, if father is
 dead) is to act as natural guardian. 
 In case of an illegitimate minor child, his/her mother is the natural guardian. 
 The natural guardian of an adopted son is his adoptive father/mother. 
 For a Muslim minor, father is the natural guardian (for property only). After father,
 guardianship lies with (i) executor appointed by father‟s will and after him (ii) father‟s father 
(iii) the executor appointed by the will made by the father‟s father. 
 Where none of these persons is alive, the minor can be represented only by a legal guardian. 
In case of Christians and Persons of other Religions
 The father, and on his death, mother acts as natural guardian. 
 Where both are dead, a person appointed by Court can alone act as guardian. OTHER 

IMPORTANT POINTS ON GUARDIANSHIP

 Even after conviction, the natural guardian continues to be the natural guardian. 

 A guardianship can be for the person, or for the property or for both. A legal guardian
appointed for person (and not for the property) is not entitled to open, operate and
receive deposit on behalf of the minor. 
 In case of Muslims, the natural guardian is guardian only for the property and not the person
of the minor. 
IMPORTANT

Mental Health Act, 1987. The Act deals with persons who are mentally ill (persons in need of
treatment by reason of any mental disorder other than mental retardation). Under the Act,
where the Mentally ill person is incapable of taking care of himself, the Distt. Court or where a
direction has been issued under the Act, the Collector of the Distt may appoint any suitable person
to be his guardian.
 The guardianship will continue (even after attaining the age of 18 years, in case of minor) as
long as the disability continues. 
 No current account will be opened in the name or on behalf of such persons and in no case
such person will be allowed an overdraft. 
 In case the ward, whose guardian has been appointed under the above two Acts, is minor,
nominee in the account can be appointed by such guardian in terms of the nomination rules.
However, where the ward is major, Guardian will not be permitted to make nomination
in the account. Nomination made during minority of the ward will cease to be operative after
the attainment of age of majority by the ward. 
 On the death of the guardian, no operation in the account will be allowed unless the new
guardian is appointed by the Competent Authority under the Act. 

 On the death of the ward, the matter will be dealt as a claim case. 
 Locker facility will not be allowed to the guardian appointed under the above Acts. 

ILLITERATE PERSONS
i) Capacity to Contract

 Persons who cannot read and write are called illiterates. 

 Like others, illiterate persons are fully competent to enter into contracts. 
However, they can avoid the contract if they can prove that their consent was obtained by
misrepresenting the facts due to their incapability to read. Banks, therefore, must create
sufficient evidence to prove that the illiterate understood the terms and conditions beyond
doubt.
ii) Type of Account
 No Current Account should be normally opened in the name of illiterate persons as it would
be difficult to identify his LTI in cheque issued by him. 
- SF and Term Deposit Accounts can be opened with condition that withdrawals will be
allowed only in person.
iii) Joint Account
 Joint Accounts in the name of two illiterates can be opened after observing usual safeguards
iv) Operation 
 No cheque book is to be issued. Withdrawal should be allowed only in person after proper
identification. The passing official will verify in the withdrawal form under his signature to
the effect that the left hand thumb impressions affixed in his presence and the amount
withdrawn is orally confirmed, by the (illiterate) depositor. 
 Where the illiterate person gives a power of attorney in his account, the mandate should be
attested by a Notary public. 
BLIND PERSONS
i) Risks in Opening Account in the Name of Blind Persons
 Blind persons are fully competent to enter into contract and there is no legal bar in opening
accounts in their name or getting loan documents executed by them. 
- However, in case of dispute they can always argue that the terms and conditions of the account
and the amount paid were misrepresented to them. They may dispute their signature at a later
date. The courts may also believe this on account of their blindness. For this reason banks
should be extra careful while opening and allowing operations in the accounts of blind
persons.
ii) Type of Accounts
 Current A/c.: Current account should not be opened in the name of a blind person. 
Joint Accounts
- Joint Account in the name of two blind persons must not be opened.
iii) Opening and Operation of Account
 A respectable person, who should certify that the contents are explained to the blind person
in his presence, must witness the signature in the account opening form. 

 Photographs should be obtained and be used in the same way as is done in case of illiterates. 
 The visually impaired customer may be allowed to use cheque book with „order‟ so that the
payees could be traced. 

 The account opening form, specimen signature sheet, pass book, cheque book must be
branded with “Blind Person” so that caution is exercised while transacting with the blind
customers. 

Considering the fact that the blind persons / persons with low vision are legally
competent to contract, lockers facility can be allowed to such persons also.

MARRIED WOMEN
 Competent to contract: A married woman can enter into a valid agreement in her own
name and therefore, the bank can open account in her name and give loans against
documents executed by her. 

 She possesses legal entity separate from her husband. Her marriage does not affect any
right of her separate property. 

 Change of name after marriage: While a lady maintaining account in maiden name
approaches for a change of name in the deposit account consequent to her marriage, the
bank should obtain a letter from her asking for the change and evidence like marriage
invitation card/marriage certificate/newspaper publication about the marriage. (In case it is
not available, a respectable person/ introducer should confirm about the marriage). Fresh
specimen signature will be obtained and the title of the account will be changed as: Mrs.
LM Gupta nee Miss LM Aggarwal. 


i) Liability in case of Overdraft/Loan
A husband cannot be made liable for payment of loans taken by his wife except when (i)
the debt is incurred for the purpose of necessities suited to her life, and (ii) the loan is
given with his consent.
 For this reason banks prefer to take guarantee of husband while sanctioning loans to a
lady. 

 As per Sec. 56 of CPC, a woman cannot be arrested or imprisoned for non-payment of
judgement debt. 
PURDANASHIN LADIES
A purdanashin lady is a woman who remains in complete seclusion and does not transact with
people other than her family members.
i) Undue Influence
A purdanashin can avoid a contract if there is undue influence on her for signing the contract.
Where a purdanashin complains of undue influence the onus of proving the absence of undue
influence lies on the other party to the contract.
ii) Type of Account
 No account should be opened in the name of a purdanashin lady who is an illiterate. 


No Current Account should normally be opened in the name of purdanashin lady except in
 exceptional cases (with prior approval from Circle Office). 
 The signature of the purdanashin lady in the account opening form should be attested by
 her husband and in case of unmarried, by her natural guardian. 
 The cheques/withdrawal slips executed by her should be attested by her husband or two
 account holders of the bank. 
  Photograph of the purdanashin must be obtained while opening account in her name. 
TRUST ACCOUNT 
“
 Trust is an obligation, annexed to the ownership of property and arising out of a
confidence reposed in and accepted by the owner or declared and accepted by him for the
benefit of another or of another and the owner”. 

 Trust Deed is the document through which a trust is formed. It records the right and
obligations of the trustees. A trust deed should be registered. 
APPOINTMENT OF TRUSTEES
 The trust deed generally mentions the names of the trustees. Alternatively it may name a
person who will appoint trustees.
  It may provide that new trustees can be appointed by the surviving trustees/legal 
representative of surviving trustee. In this case, the appointment is done by executing a
“
deed of appointment” by the outgoing and incoming trustees. 

 The trust deed may provide that new trustees will be appointed by Court. 

Death of Trustee
 If the sole trustee dies, the operation in the account should be stopped. Cheques signed by
him are not to be paid. 

If one of the trustees dies/retires the surviving trustees can operate the account if the trust
deed provides of. For example, if the trust deed provides that minimum two trustees can
operate the accounts, the operation of the account need not be stopped as long as the
number of surviving trustees is two or more. 
Insolvency
 Even if a person is declared insolvent, he can continue to be the trustee. 

 The trust property cannot be attached to pay the dues of a trustee who is declared
insolvent. 

JOINT HINDU FAMILY

Joint Hindu Family or Hindu Undivided Family (HUF) is governed by Hindu Law except to
the extent altered by certain acts.
Two Schools of Hindu Law
There are two schools of Hindu Law: (I) Mitakshara, which prevails throughout India except
West Bengal and (ii) Dayabhaga which prevails in Bengal.
i) Mitakshara Law
 Under Mitakshara school of Hindu law all male member have a right on the joint family
property by birth (even from the time of conception) which is called as “Doctrine of
ownership by birth”. The HUF consists of one common living ancestor and his male
descendents upto three generations next to him. The HUF is also known as 
“
COPARCENERY” and the male members are called co-parceners. All co-parceners have
equal right on the property of HUF.
- As per “The Hindu Succession (Amendment) Act 2005” – which came into force w.e.f.
09.09.2005 the daughters have been given equal rights as sons.
ii) Dayabhaga School of Law
 They treat father as the absolute owner of property and sons do not acquire any interest in
 property by birth. 
Karta and Co-parceners 

 The eldest male member of the HUF is called Karta and other male members are called co-
parceners. 

 As per law, Karta has power to incur debt, execute document, pledge securities on behalf of
the family for the purpose of family business for the legal necessity of the family. His
liability is unlimited while that of the co-parceners is limited to the shares in the joint family
 estate. Accordingly the consent of co-parceners is not required. 
 While giving loan/overdraft to a HUF” the bank should be extra careful because the banks
prefer to obtain loan documents executed by all major male members of the family or with
their written consent by the head of the family. 

 Further the liability of co-parceners is limited only to the extent of their share in HUF
property. However, if the documents are executed by all co-parceners they become
personally liable. 

 Where there is a minor co-parcener, his guardian should sign the document on his behalf.
Upon attaining majority, express consent should be obtained form him. 

Operation of Account
 A co-parcener, even though not permitted to operate the account, can countermand the
payment of a cheque. 

 The Karta can give a mandate in favour of a major co-parcener to operate the account. 

 Mandate in favour of a third party to operate the account is not acceptable unless all co-
parceners execute an indemnity. 

 For opening a HUF account, apart from the accounting opening form, a half yearly
declaration letter regarding change in family on PNB 36 signed by KARTA is obtained. 

CLUBS, COMMITTEES, ASSOCIATIONS REGISTERED CLUBS/ASSOCIATIONS

 Clubs can be registered or unregistered. 

 While opening account in the name of a registered association bank should obtain (I) copy of
certificate of Registration (ii) copy of Bye-laws (i.e. Rules, Regulations), (iii) a certified copy
of resolution of the Executive/Managing/Governing Body) to open account and giving names
of office bearers to operate account. (This should be certified by Chairman of the meeting of
that body.) 
UNREGISTERED ASSOCIATIONS
 Examples of unregistered associations are: (I) some schools, (ii) some clubs, (iii) other
associations not registered. 

 Should be opened only in case of very reliable persons. 

 All members of managing committee/governing body should sign the resolution as per the
rules. 

 In no case overdraft should be given in such accounts. 
 No loan should be sanctioned to an unregistered club. 

CO-OPERATIVE SOCIETIES
 A co-operative society is an association registered under the provisions of the Co- operative
Societies Act of the State concerned. Therefore, all formalities required for opening the
account of a registered association must be complied with by the bank. 

 Generally co- operative societies are not permitted to open accounts in banks other than co-
operative banks unless specifically permitted by Registrar of Co- operative Societies. Banks
should ask for this permission before opening the account. 
LOCAL AUTHORITIES
 Examples of local authorities are: (I) Municipal Corporation, (ii) Zilla Boards, (iii) Notified
Area Council, etc. 

 These authorities are established under separate statutes of State/Central legislature. 

 Bank must obtain copy of such statute and find out the provisions as to who would authorize
opening bank account and who can be authorized to operate the account. 

 Generally, these authorities have a Managing Committee; with a President, Vice-President
& Treasurer, and the Treasurer is given powers to open and operate bank account. 

 No overdraft/advance should be given to such authorities, except to the extent and for the
purpose permitted by the statute. 
GOVERNMENT DEPARTMENTS
 Obtain copy of the government Notification/order authorizing the concerned person to open
and operate account. 

 Obtain copy of the letter signed by the Head of the Department, authorizing the executive to
open and operate bank account. 

 Also obtain certified copy of rules and regulations framed by the department for opening and
operation of such account. 

JOINT ACCOUNT MEANING

 Joint account means an account in the name of two or more persons. These are governed
 under Section 45 of Indian Contract Act. 
 The balance in a joint account is a joint property and can be disposed off as per the
instructions given by all the depositors. 

 All the depositors must join in signing the account opening form and the authority letter for
operation of the account. 
DIFFERENT TYPES OF OPERATION
The different types of authorities which can be given to a bank for operating a joint account
are the following: (i) By all depositors jointly, (ii) By both or survivor, (iii) By either or
survivor, (iv) By former or survivor, and (v) By any one/two persons named by them.
 Meaning of Either or Survivor

 In SB or CA account it means: (I) account can be operated by any one of the depositors, (ii)
On the death of one of the depositors the survivor can operate the account and the account
can be closed under both signatures. (Reasons: Authority to operate does not include
authority to close the account). 

 In term deposit account this notation means the following (I) On maturity, the proceeds is
payable to either or survivor, (ii) it does not by itself mean that either of them or the survivor
can foreclose the deposit or can avail a loan against the deposit under his single signature
unless specifically provided in the account opening form. 

 The survivor can be allowed to foreclose the deposit/avail loan against it only if an
undertaking to this effect was obtained from all the depositors which is a part of the AOF
itself. 
Style of operations if the account is in the name of more than two persons
 It can be (a) Jointly by all depositors, (ii) Jointly by all or survivor, (iii) Any one or
survivors and (iv) First named or survivors. 

PARTNERSHIP FIRM
The law relating to partnership firms is codified in Indian Partnership Act.
 U/s 4 of the Act, a partnership is a relationship between two or more persons who agree to
 share the profits of business carried on by all or any of them acting for all.The contract 
(agreement) may be written or oral. The document containing the written agreement is called 
“
 partnership deed”. 
 Since partnership arises out of a contract, persons who are incapable of entering into contract 
(i.e. minors, insolvents, alien enemy) can not enter into relationship arrangement with others.

Mutual Agency
 The most important characteristic of a contract of partnership is that “the business can be
carried on by all or any of them acting for all”. 

 It means each partner can act as an agent of all partners (firm) and can bind them by all his
acts during the usual course of business. 

 Thus a partner has a two fold status. He is an agent of all other partners and also the principal
to all of them. ln other words they are mutually agents to each other. 

 Sec. 18 of the Act provides that, for purpose of the business of the firm, a partner can act as
 an agent for all partners. 
 In fact law or partnership is an extension of law of agency. Unlimited Liability (Sec.25) 

 The liability of partners is unlimited. Not only properties of the firm, but the individual
properties of partners are also liable for the satisfaction of the liabilities of the firm. 

 All partners are jointly and severally liable for all the debts of the firm. Therefore, for
realising its debts given to a partnership firm, a bank can sue a partner individualy or jointly
with other partners. 

The principle of unlimited liability is however, subject to provision laid down in Sec.49 of
the Act. As per this Act, where a firm is dissolved the debts of the firm will be first met out
of the property of the firm and surplus, if any, will be utilised for payment of private debts of
partners. Similarly the personal debts of a partner will be paid first out of his personal assets
and surplus, if any, can be utilised in case of need towards the settlement of the debt of the
firm. 
Minimum and Maximum Number of Partners
 The minimum number of partners can be two. 
 As per provisions of Indian Companies Act 2013 , Maximum no. of partners of a firm can be 100
 For computing this ceiling the following points may be noted: 

i) Where one or more companies are partners of a firm, each company, irrespective of its
number of share holders, is treated as one person/partner.
ii) Firms can not become partners of another firm. Where a firm is said to be partner of
another firm, the number of partners in the former are taken into consideration for
computing this ceiling. A Minor admitted for the benefits is not to be counted towards
number of members.
Similarly a Hindu Undivided Family can not become partner of a firm. But the Karta or
any other co-parcener of the HUF can become a partner of any partnership firm in his
individual capacity.
 Though the rights of non-registered firm are affected,the right of third party to proceed
legally against the firm to enforce its rights arising out of a contract is not affected by
the fact that the firm is unregistered. 

b. Procedure for Registration (Sec. 58 and 59)
 A partnership firm can get itself registered at any time (even years after its formation)
with Registrar of Firms of the State where the head office of the firm is located. 

 For registration, the partners have to file an application giving details of the firm along
with 
fees. The Registrar records these particulars in the “Register of Firm” maintained in his
office and issues a “Certificate of Registration”. Registration is effective from the date
when
Registrar makes the entry in the register.
Minor as Partner
 A minor being incompetent to contract can not become a partner in a partnership firm. 

 However, he can be admitted to the benefit of an already existing partnership with the
consent of all partners (Sec.30 of Indian Partnership Act). 

 The liability of a minor admitted to the benefit of partnership is limited to his share in the
firm. His personal assets nor he personally can be held liable for the debt of the firm. 

 Though a minor can not be declared insolvent, his share in a firm which is declared
invsolvent vests in Official Receiver/Official Assigner. 

 On attaining majority a minor can opt-out of the partnership. 

 He must exercise this option within six months form date of his attaining majority or from
the date when he first knew about his interest in the partnership, whichever date is later. 

 This option is exercised by giving a public notice [Public Notice is given by (i) giving notice
to Registrar of Firms (ii) publication in at least one vernacular newspaper circulation in the
district where the firm has principal place of business]. 

 In case he fails to give a public notice, within the stipulated time limit, he is deemed to have
become a partner and is personally liable for all liabilities of the firm from the date of his
admission to the benefit of partnership. 
JOINT STOCK COMPANIES
The Companies Act, 1956 recognizes a stock company as a legal person. It is a separate legal
entity.
TYPES OF COMPANIES
 Companies limited by shares can be classified into three categories viz., (I) Private Ltd. Co.
(ii) Public Ltd. Co. and (iii) Government Company. 

 A Private Ltd. Co is a company which by its articles (I) restricts transfer of its shares (ii)
prohibits itself from inviting subscription of shares/debentures from public, (iii) limits the
number of its members to 200. 

 A Public Ltd. Co does not have such restrictions. 

 A Government Co. is a company where not less than 51% of the share capital is held by
government (central/state/both). 
Company Limited by the guarantee:
A company limited by guarantee is a registered company having the liability of its members
limited by its memorandum of association to such amount as the members may respectively
undertake to pay if necessary on liquidation of the company. The Companies Act 2013 came into
force w.e.f.12.09.2013. As per this ACT, the concept of small company, Dormant Company and
One Person Company have been introduced. Small company means a company other than a public
company where :
i) Paid up share capital of which does not exceed 50 lacs rupees or such higher amount as may be
prescribed which shall not be more than 5 crore rupees or
ii) Turn over of which as per its last profit and loss account does not exceed 2 crore rupees or such
higher amount as may be prescribed which shall not be more than 20 crore rupees.
Dormant Company means:
 A company formed for a future project or to hold an asset or intellectual property and has no
significant accounting transaction. 
 One Person Company- Having one Shareholder and one Director

DIFFERENCE BETWEEN A PVT. LTD. CO. AND A PUBLIC LTD. CO.

Points of Difference Private Ltd. Co. Public Ltd. Co.

i) Minimum number of shareholders 2 7
ii) Maximum number of shareholders 200 No limit
iii) Transfer of share Restricted Freely
Transferable
iv) Invitation to public for shares & debentures Prohibited Permitted
and fixed deposits
v) Certificate of commencement of Business Not required Required
vi) Minimum Directors 2 3
vii) Minimum paid up capital Rs. 1 lac Rs. 5 lac

DIFFERENCE BETWEEN PARTNERSHIP AND A COMPANY

PARTNERSHIP COMPANY
The company has a separate legal entity. It
A partnership firm is the sum total of persons
needs to be incorporated. A public company
(minimum 2 and maximum 100) who have come
may have as many members as it desires subject
together to share the profits of the business
to a minimum of 7 members. A private
carried on by them or any of them. It does not company can‟t have more than 200 members
have a separate legal entity. and less than 2.
Liability of partners is unlimited. Liability of shareholders of a limited company
is limited to the extent of unpaid shares or
unpaid
Property of the firm belongs to the partners and In case of a company the property belongs to
they are collectively entitled to it. the company and not to its shareholders.

A partner cannot transfer his shares in a Shares may be transferred without the
partnership firm without the consent of all other permission of the other members due to the
partners. absence of provision to contrary in the articles
of
On the death of a partner, the partnership is On the death of the shareholder the company‟s
dissolved unless there is provision to the existence is not affected.
contrary in the Deed of Partnership.

Right of Set Off:

Banker has a right to combine two or more accounts, of a customer in the same name and
same right, if one of them is showing debit balance
This is a statutory right arising on account of contractual obligations between the Bank and
its customers.
 Different branches of the bank are treated as one unit for exercising this right. This right is
not available if there is an agreement (express or implied) for not exercising this right.

This right can only be exercised, when debit balance is certain, determined and due ( & not
a future or contingent debt) , after sending notice to the customer and satisfying the
condition that the account must be in the same name and in the same capacity / right.
(ii) An account in the individual capacity of the Customer showing debit balance cannot be
combined with one in fiduciary capacity (i.e. trustee etc.) showing credit balance.
(iii)Accounts really belonging to same persons, but in different names can be combined.
iv) Two a/cs, of a solicitor, one in his personal name and other marked clients a/ c cannot
be combined.
(v) Two A/cs, one belonging to an individual and other jointly with someone, can‟t be
combined. The right can‟t be exercised if the deposit is in the firm‟s name and debt
due is in partner‟s name, and also when deposit is in the dividend account of company
and borrowing is in the Co‟s name. But if deposit is in the single name and borrowing
is in the joint name with joint and severally liability, and deposits are in partner‟s name
and borrowing by firm and also deposit in joint names payable to former or survivor
and borrowing is in the name of former, this right can be exercised.
(vi) The right should be exercised after giving due notice, unless a contract to the contrary
exists.

POSITION OF AVAILABILITY OF RIGHT OF SET OFF IS SUMMARISED IN THE

FOLLOWING TABLE:

Right to Set Off

Deposit in name of Loan in name of Status of Availability
Single PERSON Same person Available
Single PERSON Same person, jointly with others Available
Joint Name One of the Joint a/c Holder Not available
Single Person Same name but with different Not available
capacity i.e. trustee
Proprietor Prop Firm Available
Prop Firm Proprietor Available
Partner in a firm Partnership Firm Available
Partnership Firm Partner Not available
Trust Trustee Not available
Trustee Trust Not available
Minor( Under guardianship) Guardian Not available
Dividend account of the Loan a/c of the co. Not available.
company
KYC Policies as per RBI guidelines:
In terms of the provisions of Prevention of Money-Laundering Act, 2002 and the Prevention of
Money-Laundering (Maintenance of Records) Rules, 2005, Regulated Entities (REs) are required
to follow certain customer identification procedure while undertaking a transaction either by
establishing an account based relationship or otherwise and monitor their transactions.
REs shall obtain the following documents from an individual while establishing an account based
relationship: (a) one certified copy of an OVD as mentioned at Section 3(a)(vi) of Chapter I,
containing details of identity and address; (b) one recent photograph; and (c) such other
documents pertaining to the nature of business or financial status specified by the RE in their KYC
policy. Provided that information collected from customers for the purpose of opening of account
shall be treated as confidential and details thereof shall not be divulged for the purpose of cross
selling, or for any other purpose without the express permission of the customer. Explanation:
Customers, at their option, shall submit one of the six OVDs for proof of identity and proof of
address.
The e-KYC service of Unique Identification Authority of India (UIDAI) shall be accepted as a
valid process for KYC verification under the PML Rules, as (a) the information containing
demographic details and photographs made available from UIDAI as a result of eKYC process is
treated as an 'Officially Valid Document', and (b) transfer of KYC data, electronically to the RE
from UIDAI, is accepted as valid process for KYC verification. Provided REs / Business
Correspondents (BCs) / Business Facilitators (BFs) shall obtain authorisation from the individual
user authorising UIDAI by way of explicit consent to release his / her identity / address through
biometric authentication to the RE

There will be four pillars of KYC policy, as under:

1. Customer Acceptance Policy;
2. Customer Identification Procedures;
3. Monitoring of Transactions; and
4. Risk Management

1. CUSTOMER ACCEPTANCE POLICY defines explicit criteria for acceptance or non-

acceptance of a customer and his / her relationship with the Bank. The broad aspects of the policy
are:
i. Bank will not accept any person / entity barred by law of the land to avail banking
facilities as its customer;
ii. No account should be opened in anonymous / fictitious or benami name (s).
iii. To ensure that new or existing customer’s identity does not match with that of any
person with known criminal background, any banned entity like terrorist
organizations, violators of law etc.
iv. No account should be opened (or existing account continued) where the bank’s due
diligence relating to identity, and the availability of valid documents are not
fulfilled;
v. The bank will ensure to obtain documents and other information in respect of different
 categories of customers depending on perceived risk and keeping in mind the
requirements.
vi. Bank will parameterize risk perception of the customer in terms of nature of
business/activity, location of customer and his clients, mode of payments, volume of
turnover, social and financial status, etc. to enable categorization of customers into
three types of risk categories viz., Low, Medium and High Risk, based on risk
perception decided on acceptance criteria for each category of customers;
vii. Bank will not make payment of any remittance where the Bank is unable to apply
appropriate customer due diligence measures

CUSTOMER IDENTIFICATION PROCEDURE(CIP): The Customer Identification

Procedure will be carried out at the time of:
a) Establishing banking relationship;
b) Carrying out a financial transaction or when the bank has a doubt about the
authenticity/veracity or the adequacy of the previously obtained customer
identification data.
c) When the Bank feels it is necessary to obtain additional information from the existing
customers based on the conduct/behavior of the account.

Identifying the customer and verifying his/her identity by using reliable, independent source
documents, data or information. Besides obtaining of valid proof of address, an independent
verification of address will also to be carried out, by sending “Letter of Thanks” to the customer
and to the introducer (if required).

The nature of information/documents required would also depend on the type of customer
(individual, corporate etc.). For customers that are natural persons [individuals], the bank to obtain
sufficient identification data to verify the identity of the customer, address/location, and also
recent photograph.
MONITORING OF CUSTOMER TRANSACTIONS:
Monitoring of Customer Transactions involves the following steps:
� Policy and procedures should clearly help the parameterising of the type and size of
normal transactions in customer‟s accounts and the quick identification, for further
enquiry, of an abnormal transaction.
� Special attention should be paid on all complex, unusually large transactions and
suspicious
patterns that indicate violation of the laws of the country threatening its financial well
being.
� Transactions just below the „threshold‟ limit that need to be reported to
the regulators/monitoring authority.
� Transactions that involve large amounts of cash inconsistent with the customer‟s
normal/expected activity should receive special attention.
� Very high account turnover, inconsistent with the balance maintained, income declared,
may indicate „washing‟ of illegal funds.
� Record should be maintained of all transactions, deposits or withdrawal involving Rs. 10
lac & above.
� Internal monitoring system to report such transactions as Suspicious Transactions.

Based on the AML risk classification of the customers, the transactions in the accounts are to
be monitored in the light of PML guidelines so as to find out any transaction which is
inconsistent with the known profile of the customer. Any suspicious transaction coming to
light through scrutiny of above reports or otherwise, is to be reported as per guidelines.

It is pertinent to mention that while reporting a transaction/activity as suspicious, this fact

should not be disclosed to the party and the transactions in the account must not be stopped.
 Reporting should not result into any harassment to the customer.

SMALL ACCOUNTS:-
(a) Small account‟ means a saving account where :
i. the aggregate of all credits in a financial year does not exceed Rs. 1,00,000/-;
ii. the aggregate of all withdrawals and transfers in a month does not exceed
Rs.10,000/-; and
iii. the balance any point does not exceed Rs. 50,000/-.
(b) Foreign remittances are not credited to a small account. „Small Accounts‟ shall remain
operational initially for a period of twelve months, and thereafter for a further period of
twelve months in case such account holder provides evidence to the bank of having applied
for any of the „officially valid documents‟ within twelve months of the opening of the said
account, with the entire relaxation provisions to be reviewed in respect of the said account
after twenty four months

WHAT IS MONEY LAUNDERING

~ Money laundering is the process whereby proceeds of crimes such as drug trafficking,
smuggling, etc. are converted into legitimate money through a series of financial
transactions making it impossible to trace back the origin of funds.
It is the process used by criminals through which they make “dirty” money appear “clean”
or the profits of criminal activities are made to appear legitimate.
Money laundering refers to „washing‟ of the proceeds or profits generated from Drug
trafficking, People smuggling, Arms, antique, gold smuggling, Prostitution rings,
Financial Frauds, Corruption and Illegal sale of wild life products and other specified
predicate offences

MODUS OPERANDI OF MONEY LAUNDERING Money Laundering consists of three

stages: 

1. The first stage involves the Placement of proceeds derived from illegal activities – the
movement of proceeds, frequently currency, from the scene of the crime to a place, or
into a form, less suspicious and more convenient for the criminal.

2. The second stage is called Layering. It involves the separation of proceeds from illegal
source through the use of complex transactions designed to obscure the audit trail and
hide the proceeds. The criminals frequently use shell corporations, offshore banks or
countries with loose regulation and secrecy laws for this purpose.

3. The third stage is called Integration. It represents the conversion of illegal proceeds
into apparently legitimate business earnings through normal financial or commercial
operations. Integration creates the illusion of a legitimate source for criminally derived
funds and involves techniques as numerous and creative as those used by legitimate
businesses e.g false invoices for goods exported, domestic loan against a foreign
deposit, purchasing of property and co-mingling of money in bank accounts.
LEGAL PROVISIONS
The Prevention of Money-laundering Act, 2002 was enacted to prevent money-laundering. The
enactment of this Act had become necessary to implement the political declaration adopted by the
Special Session of the United Nations General Assembly held in June, 1999 which called upon
Member-States to adopt national money-laundering legislation and programme.

Prevention of Money Laundering Act, 2002

The Prevention of Money Laundering Act, 2002 (PMLA 2002) forms the core of the legal
framewor put in place by India to combat money laundering. PMLA 2002 and the Rules notified
there unde came into force with effect from July 1, 2005 . PMLA 2002 defines money laundering
offence and provides for the freezing, seizure and confiscation of the proceeds of crime.

Maintenance & Preservation of records:

In terms of Section 12 of PMLA Act Rule 3, Banks should maintain for at least 10 years from the
date of cessation of transaction between the bank and the customer, all necessary records of
transaction both domestic and international, in addition to cash transaction of Rs. 10 lac and
above.

REPORTING UNDER PMLA

The Prevention of Money-laundering Act, 2002, and the rules there-under require every banking
company, financial institution and intermediary, to furnish to FIU-IND information relating to : -
Cash transactions of the value of more than rupees ten lacs or its equivalent in foreign currency;

- Series of cash transactions integrally connected to each other which have been valued below
rupees ten lacs or its equivalent in foreign currency where such series of transactions have
taken place within a month;

- Cash transactions where forged or counterfeit currency notes or bank notes have been used as
genuine or where any forgery of a valuable security or a document has taken place facilitating
the transactions;

- Suspicious transactions whether or not made in cash.

DEFINITION OF SUSPICIOUS TRANSACTION

WHAT CONSTITUTES A SUSPICIOUS TRANSACTION UNDER PMLA 2002?
Suspicions transaction means a transaction whether or not made in cash which, to a person acting
in good faith –
a) gives rise to a reasonable ground of suspicion that it may involve the proceeds of crime; or
b) appears to be made in circumstances of unusual or unjustified complexity; or
c) appears to have no economic rationale or bona fide purpose; or
d) gives rise to a reasonable ground of suspicion that it may involve financing of the activities
relating to terrorism

Broad categories of reason for suspicion and examples of suspicious transactions for a bank/
intermediary are indicated as under:
Identity of Client

- False identification documents

- Identification documents which could not be verified within reasonable time
- Non-face to face client
- Doubt over the real beneficiary of the account
- Accounts opened with names very close to other established business entities

Suspicious Background
- Suspicious background or links with known criminals

Multiple Accounts
- Large number of accounts having a common account holder, introducer or authorized
signatory with no rationale
- Unexplained transfers between multiple accounts with no rationale

Activity in Accounts
- Unusual activity compared to past transactions
 - Use of different accounts by client alternatively
- Sudden activity in dormant accounts
- Activity inconsistent with what would be expected from declared business
- Account used for circular trading
Nature of Transactions
- Unusual or unjustified complexity
- No economic rationale or bona fide purpose
- Source of funds are doubtful
- Appears to be case of insider trading
- Investment proceeds transferred to a third party
- Transactions reflect likely market manipulations
- Suspicious off market transactions
Value of Transactions
- Value just under the reporting threshold amount in an apparent attempt to avoid reporting
- Large sums being transferred from overseas for making payments
- Inconsistent with the clients apparent financial standing
- Inconsistency in the payment pattern by client
- Block deal which is not at market price or prices appear to be artificially inflated/deflated

COUNTERFEIT CURRENCY NOTES OR BANK NOTES

Cash transactions where forged or counterfeit currency notes or bank notes have been
used as genuine or where any forgery of a valuable security or a document has taken place
facilitating the transactions.
MAINTENANCE OF MINIMUM BALANCE
Minimum balance for opening deposit account; the stipulations prescribed by RBI for opening
deposit account stands withdrawn vide marketing division circular no. 59/95. Individual banks
are given liberty to fix the minimum balance to be maintained by depositors. Our bank has
 stipulated the following minimum balance / QAB to be maintained. However, for opening of
a/c at any branch the initial deposit requirement is Rs. 500/-

Area SAVING FUND CURRENT ACCOUNT

CBS BRANCH Non- CBS NON-CBS CBS
QAB MIN.BAL. MIN.BAL. QAB
Rural 500 500 1000 1000
Semi-Urban 1000 1000 3000 3000
Urban 1000 1000 5000 5000
Metro 1000 1000 5000 5000

Note : The minimum balance to be maintained in SF a/c of SHG and by students belonging to
SC/ST categories (without Cheque Book facility) is Rs. 100/- at all paces.
In case of Savings A/c opened under the PNB MITRA Scheme (no frill a/c) initial deposit
required for opening the a/c and the minimum balance to be maintained is nil.

NOMINATION ENACTMENT
 The Banking Regulation Act was amended in 1984 and sections 45ZA to 45ZF were added to
 the Act for providing nomination facility in Banks. 

 In 1985, the Central Govt. made the “Banking Companies (Nomination) Rules (As per powers 
conferred on it in section 52 of the BR Act 1949) which was notified in official Gazette of India
on 29th March 1985. Nomination facility was introduced in banks with effect from this date. 

SCOPE
 Banks can provide nomination facility for deposit accounts, safe custody of articles and safe
deposit lockers. 

 Sec. 45ZA and 45ZB deal with the provisions for nomination deposit accounts section 45ZC
and 45ZD for safe custody and section 45ZE and 45ZF for safe deposit lockers. 

 Banks cannot provide nomination facility in respect of Jewel Loans, Cash Credit Account or
any such account other than the three mentioned above. 
NOMINATION FACILITY FOR DEPOSIT ACCOUNTS
 What Type of Accounts: Nomination facility is available only in respect of a deposit account
held in individual capacity (including sole prop. CA account) of the depositor(s) and not in any
representative capacity. As such no nomination can be made in case of accounts in the name of a
company, firm HUF, association trust, etc. 

 Minor’s Account: Where the deposit is the name of a minor, the nomination will be made by
his legal guardian. In case of self operated minor accounts no nomination can be accepted. 

 Non-resident Accounts: Nomination facility is available. 

 Joint Account: Nomination should be made jointly by all joint account holders even if the
account is operated by either or survivor or former or survivor. 

Who can be appointed as nominee?

 Only Individuals can be appointed as nominee. Nomination cannot be made in favour of
firms/companies/H U F or any representative body. 

 In case of deposits,only one person can be appointed as nominee; for a particular account . (This
provision is different in safe deposit locker accounts). 

 A minor can be appointed as nominee. However in such cases another adult (not necessarily
his/her guardian or relative) must be named to receive the deposit on behalf of the minor, in case
 of the death of depositor(s) during the minority of the nominee. 

 Nonresidents including foreign nationals can be appointed as nominee. However, on the death of
depositor the deposit proceeds cannot be repatriated without obtaining prior permission from
Reserve Bank. 

 A lunatic cannot be appointed as nominee. 

How to Nominate
 In case of joint accounts all depositors must join together to nominate. 

 Nomination is required to be made in Form DA1 (PNB-819 A) must be attested by one witness
and in case the depositor(s) is illiterate the thumb impression (in form DA1) must be attested by
two witnesses. 

 Separate nominations need be obtained in respect of different deposit accounts. 

 The bank should brand the pass book/receipt and relative ledger folio with the stamp
“
NOMINATION OBTAINED”. 

 RBI has advised that at the written request of a customer the bank may mention the name of the
nominee in SB pass book/term deposit receipt. 

Cancellation and Variation of Nomination

 An existing nomination can be cancelled by the sole depositor (or by all the depositors in a joint
 account). The form to be used is DA 2(PNB-819 B) 
 The variation of nomination can be made by all depositors, by using form DA3 (PNB-819 C) 

 In case of the death of one of the joint depositors, the cancellation or variation can be made
under the signature of all surviving depositors/depositor. 
Renewal of Deposit Account
 No fresh nomination need be made when a deposit account is renewed. The existing nomination
does not cease to operate merely by reason of the renewal of the deposit. 
Change in the style of the account
 Where the style of the account is changed, or some addition/deletion in the name of depositors is
made, the nomination stands cancelled. 
Payment to Nominee
 Nominee‟s right to receive payment arises only on the death of the sole depositor or on the death
of all depositors in a joint account. 
 Nominee has the only right to receive the deposit proceeds on the depositor‟s) death. He has no
right to operate the account, to renew the same or to avail loan against it or to substitute his name
in place of depositor or to add his name in the deposit. 

 A term deposit can be paid (at the request of the nominee) before its maturity. No penalty (1%)
 need be charged in case of such foreclosure. 
 Before paying the amount to the nominee the bank must ask for the Death Certificate and take
identification of nominee on the prescribed form (PNB- 831).and must ensure that there is no
restraint order from court.(IAD cir 28/11 dated 8.6.11) 
Legal position on Payment to Nominee
 On the death of the depositor(s) the nominee is entitled to receive the balance. The bank need not
take into account any other notice or claim except the order of a competent Court. 

 The nominee does not become the owner of the proceeds by virtue of his right to receive the
payment. Any person having a right over the balance can claim it from the nominee.So, nominee
 will receives the payment as trustee of legal heirs. 
Miscellaneous
 The formats for nominations; alteration of nominations, and variation of nomination are
prescribed in Banking Companies (Nomination) Rules 1985 

 A depositor can be allowed to split his deposit for the purpose of appointing different nominees.
This will not be considered as a premature closure. 

 In case of deposit accounts under Capital Gains Accounts Scheme 1988 a maximum of three
nominations under both schemes Account- A (Savings Fund), Account-B (Term Deposit) is
permitted. 

 In case of pension accounts there should be two types of nominations; one for payment of
pension arrears which is made under “Arrears of Pension (Nomination) Rule 1983”. The other is
made under Banking Companies Nomination Rules 1985. 

 If the nominee does not turn up even after 6 months from the death of the depositor/locker
holder, a notice should be sent by the bank to the nominee. 

NOMINATION FACILITY FOR ARTICLES KEPT IN SAFE CUSTODY

 Nomination facility is available only where the articles are held in single name of individuals. In
other words Safe Custody (Account) in Joint Names is not eligible for nomination. (Note the
differences from deposit account and lockers where nomination is acceptable in account in joint
names). Like deposit accounts nomination is also not available on safe custody deposits made in
representative capacity. 

 Where a minor delivers the goods for safe custody, the nomination will be made by his lawful
guardian. 

 Only one individual can be appointed as nominee. Where the nominee is a minor, any other adult
should also be appointed to receive the articles in the event of the death of the depositor during
the minority of the nominee. 

 The nomination will be made by using form SC-I (PNB-820 A) while cancellation and variation
of nomination are to be made by using form SC-2 and SC-3 (PNB-820 B, 820-C) respectively. 

 Separate nomination form should be obtained for each lodgement. 

 All other terms and conditions of nomination in safe custody account are same of those
applicable to deposit accounts. 

NOMINATION FACILITY IN SAFE DEPOSIT LOCKER ACCOUNTS

 The main points of difference between nomination facility in deposit account and that of
Safe Deposit Locker Account are the following: 
Number of Nominees
 In case of safe deposit locker account in joint names more than one person can be
appointed as nominee.Each hirer can have its own nominee. However, the maximum
number of nominees will be restricted to the number of joint account holders. 
Others:
 Nomination is a rule rather than exception. 

 BM has full powers to make payment, release articles and handover contents of
locker to nominee after death of depositor/locker hirer. 

 Acknowledgement must be sent to the customer. 

  Guardian will sign Nomination forms in the account of Minor. 

 Pass book must contain remarks” Nomination Registered”(IAD cir 28/11 dated 8.6.11) 
While making nomination, cancellation or change thereof, it is not required to be attested
by witnesses. However, in case of thumb impression of the account holders obtained on
nomination forms, are required to be attested by two witnesses.(RMD Cir. 33/15 dt
12.08.2015)
Forms to be Used
 Form SL 1 (PNB-821 A) is to be used by a sole hirer for making nomination. 
  Form SL 1A (PNB-821 B) is to be used where the locker is hired in joint names. 
 Form SL 2 (PNB-821 C) is to be used for cancellation of nomination. 
 Form SL 3 (PNB-821 D) is to be used for variation of nomination by a sole hirer. 
 Form SL 3A (PNB-821 E) is to be used for variation of nomination by joint hirer. 
Delivery of Locker Content in Case of Joint Accounts
 In the event of the death of one or more joint hirers the contents of the locker are
 deliverable to the nominees along with the surviving joint hirer/hirers. 
 In case of lockers with either or survivor clause or former or survivor clause, on the event
of death of one of the hirers the survivor can take delivery of goods only along with the
nominee(s). In other words, where there is a nomination, the survivors have no right to
 take delivery of the contents without the consent of nominees. 
 They also cannot change the nominations unlike deposit accounts. 
Preparation of an Inventory of the contents of the Locker
 Before permitting the removal of the content of a locker by the nominee (or by nominees
along with surviving hirers) an inventory of the content of the locker must be prepared. 
  Sealed/closed packets, if any, need not be opened. 
  It should be signed by the nominee(s) surviving heirs. 
 The nominee(s) and survivors are entitled for a copy of the inventory. 

Particulars Deposit accounts Safe custody Safe deposit vault (locker)

Section 45ZA 45ZC 45ZE,45ZF
Nomination 819A 820A 821A ,821B*
Cancellation 819B 820B 821C
Substitution/ 819C 820C 821D
Variation 821 E*
* To be used for nomination/variation for more than one person.

CUSTOMER SERVICE AND GRIEVANCE REDRESSAL

CUSTOMER SERVICE
The most crucial measure of performance of a service industry is the level of satisfaction of
its customers.
Some of the important measures, pursuant to the recommendations of the working group on
Customer service in Banks (Talwar Committee recommendations, 1977 {176
recommendations}, Goiporia committee recomedations, 1991, 97 recommendations and
S.S.Tarapore committee on Procedures and performance audit on Public services) are as
under:
The important recommendations of the working groups/ committees on customer service in
the banks are as under: looked in to the aspect of customer service

Opening & Closing of bank counters in time and prompt commencement of customer
service: It must be ensured that all counters begin their work in time and no counter is left
 unattended during the customer hours. Incumbent Incharge may consider starting of office
hours 15 minutes prior to banking hours, at theirs. This would facilitate the staff to
 settle on counters well in time and cash would also be available to the cashiers/SWO‟s.
All the customers
 who enter the banking hall before the close of business hours should
 be attended to.

Cleanliness & Upkeep of premises & provision of adequate facilities to make the
 customer's waiting time comfortable. 

Sitting plan and uninterrupted service to the customers: Sitting plan of the office
should be functional and designed to facilitate smooth and speedy flow of work. Work
 allocation in such a way that no counter is closed  during the working hours and
uninterrupted service is rendered to the customers.

MAY I HELP YOU' counters/Display of indicator boards: display of indicator e
 Boards at all the workcounters, enabling the customers to be guided about the actual
work being transacted.

MAY I HELP YOU' counters, in the branches with a staff strength of 10 or above , to

be manned by suitable persons. At smaller branches, provision must  exist for an
enquiry window for attending to the enquiries and help the customers.

Display of time norms and adherence thereto: The poster of norms for important
services must be conspicuously displayed in the banking hall for guidance of
customers. Endeavour must be made to provide services to clientele within the time
norms prescribed given below. The time norms prescribed for various important
services may be taken as a guiding factor and our endeavour should be to complete the
transactions as speedily as possible and taking the norms as a maximum limit. In this
 
regard, particular care must be exercised in rendering more common services like
encashment of cheques and issuance of drafts etc.
Norms for important services at the branch: (1) For encashment of a cheque: (a)
through SWO/Teller -- 3 to 8 minutes; (b) through Cashier -- 8 to 15 minutes. (2)
Receipt of cash (depending upon the denomination --10 to 20 minutes (3) For issuance
of demand draft/ remittances/traveller cheques/ term deposit receipt --- 15 to 25
minutes. (4) Payment of demand drafts -- 10 to 20 minutes. (5) Payment of term deposit
receipts -- 15 to 20 minutes. (6) Opening of an account -- 20 to 25 minutes (7)
Retirement of bills --20 to 30 minutes (8) Completion of pass books (for a few entries) -
- 5 to 15 minutes. (9) Statement of accounts - Within 7 days from due date. (10)
Collection of Cheques (a) Local - 1 to 3 days (b) Outstation -- 10 to 14 days. (11)
Issuance of cheque book -- Within 15 minutes

Customer Service Committee

Customer Service Committee is to be set up at branches for reviewing the quality of customer
service on an ongoing basis; their constitution will be as under:

1. CM/Manager : Chairman
2. Sub Manager/AM/Officer : Member (Convener)
3. Other Officer(s) : Member
4. Clerical Cadre : Member
Members under 3 & 4 category will be rotated after an interval of 6 months. Minimum 2
required to hold meetings.
Periodicity – at least monthly
Bank union representative may be included.
Customers to be invited once in quarter.
Minutes to be recorded & copies be sent to CO.
 BANKING OMBUDSMAN SCHEME -2006

- Scheme has been framed and notified under Sec 35A of Banking Regulation Act 1949
- It is applicable to all banks (as defined in Part I of BR Act 1949) throughout India, whether
incorporated in or outside India.

OBJECTIVE :-To enable resolution of complaints relating to provision of Banking Services and to
resolve disputes between a bank and its constituent as well as between one bank and another.

APPOINTMENT:-RBI may appoint one or more persons to carry out the functions entrusted under
the scheme.

JURISDICTION:- As specified by RBI from time to time

QUALIFICATION:-A person of high-standing in legal/banking/financial services/ public

administration/ management sector. If such person is a civil servant he should be in the rank of Joint
Secretary or above in Govt. of India.

POWERS & DUTIES

  To receive complaints relating to provision of banking services. 
 To facilitate satisfaction or settlement by agreement, through conciliation and mediation or
 by passing award in accordance with this scheme. 
 To resolve by away of arbitration such disputes between banks or between bank and its
constituents as may be agreed upon by the contesting parties provided the value of the claim
in such disputes is within Rs. 10 lacs. 

PROCEDURE OF FILING THE COMPLAINT

 The consumer should first give a written representation to the bank, in question. If the bank
rejects the claim or does not reply or the reply is unsatisfactory, the complainant is free to
write to the banking Ombudsman, but after 1 month and before one year since lodgement
of the complaint with the bank. The complaint should not be in respect of the same subject
matter which was settled or dealt with on merits by the Banking Ombudsman in any previous
proceedings whether or not received from the same complainant or along with one or more
 complainants or one or more of the parties concerned with the subject matter. 
 The complaint should not pertain to the same subject matter, for which any proceedings
before any court, tribunal or arbitrator or any other forum is pending or a decree or Award or
order has been passed by any such court, tribunal, arbitrator or forum. 
  The complaint is not frivolous or vexatious in nature. 
 The complaint can be made in electronic mode too. 

APPEAL
Any person aggrieved by the Award or rejection of the complaint may, within 30 days of the date of
receipt of the Award / rejection of complaint, may prefer an appeal against the Award before the
Appellate Authority i.e. Dy. Governor of RBI. In case of appeal by the bank, the period of 30 days
for filing an appeal shall commence from the date of receipt of acceptance of the award by the
complainant.

The Appellate Authority may, if he is satisfied that the applicant had sufficient cause for not
making the appeal within time, allow a further period not exceeding 30 days.
 CONSUMER PROTECTION ACT 1986

EXTENT/COVERAGE:

All goods & services including Banking, insurance, transport, processing, electricity, physicians etc.
All sector - private, public & cooperative. The act extends to whole of India except J&K. J&K has a
separate act on similar lines.

WHO CAN FILE A COMPLAINT?

� A consumer, individually or jointly, representative or legal heir of the consumer.
� Any voluntary consumer organization.
� Central & State Government.

WHO IS A CONSUMER?
A person who buys goods for a consideration, which has been paid or promised to be paid or partly
paid and partly promised to be paid or a person who buys under any system of deferred payment; and
includes any user of such goods who uses the goods with the approval of the purchaser. Persons
buying for resale or for any commercial purposes are not consumer. One who hires services for
consideration.

The Complaint means any allegation in writing made by a complainant alleging adoption of any
unfair trade practice or restrictive trade practice by any service provider or deficiency in service
hired or availed of or excess charging for any services with a view to obtaining any relief under the
Act.

WHAT IS THE LIMITATION PERIOD FOR FILING COMPLAINT?

Two years from the date of cause of action (Sec 24A). Cause of action arises on the date on which
the consumer comes to know of the deficiencies in service or the defect in goods or the thing
complained of.

WHAT IS THE JURISDICTION FOR COMPLAINT?

OFFICE VALUE/COMPENSATION
NationalConsumerDisputesRedressal More than Rs. 100 Lac
Commission (National Commission)
State Consumer Disputes Redressal Commission More that Rs. 20 Lac & upto Rs. 100 Lac
(State Commission)
District Consumer Disputes Red ressal Commission Upto Rs. 20 Lac
(District Forum)

WHAT IS THE TIME LIMIT FOR DECIDING COMPLAINTS/APPEALS?

Without analysis/testing of commodities : 3 months
With analysis/testing of commodities : 5 months
National & State Commissions : 3 months

WHICH IS THE OFFICE FOR APPEAL?

DECISION OF WHOM TO APPEAL

District Forum State Commission
State Commission National Commission
National Commission Supreme Court
 Appeals are to be made within 30 days of receipt of decree from lower forum/commission.

IS THERE ANY PENALTY FOR NON-COMPLIANCE OF ORDERS OF THE

FORUM/COMMISSION OR FOR COMPLAINTS OF FRIVOLOUS NATURE?
Imprisonment for not less than one month and up to three years OR fine not less than Rs. 2000/-
and up to
Rs. 10000/-OR Both.

SETTLEMENT OF CLAIM CASES

To provide prompt and efficient customer service, early settlement of deceased claims in deposit
accounts is very much important. On receipt of information that a depositor has died, a note may be
made on the ledger sheet in writing/system with date and source of information, a line should be
drawn below the last debit entry and operation in the account be stopped. The information should be
noted under the initials of the official.
As part of efficient customer service, steps should be taken to ensure expeditious settlement of claim
cases in deceased accounts. As per the recommendations of Goiporia Committee on Customer
service in view of avoiding difficulties in disposal of claim cases, nomination should be encouraged.
With the view of minimizing the hardship to the legal heirs of the deceased, as per the new
guidelines, bank should not insist upon the legal representation (succession certificate, letter of
administration etc.). No limit is prescribed below or beyond which legal heirs be asked to
produce succession certificate (refer Law Divn.Cir.5/2015 dated 13.10.2015).
Therefore, if Incumbent is satisfied that legal heirs are identifiable and there is no dispute in respect
of claim with bank, amongst legal heirs, there is no necessity of requiring production of legal
representation.
Chapter II: Settlement of claim in nominated accounts.
Chapter III: Whenever it comes to the notice of the branch that a depositor has died, caution should
be maked on the following documents:
- AOF
- Specimen Signatures Slip

The operation in the account should be stopped immediately. Nominee should be advised to produce
following documents:
1. Death Certificate (issued by competent authority)
2. Claim form – PNB 831 Annex.E
3. Claim form should be verified by Magistrate or Notary Public or Gazetted Officer or
Bank Officer
4. Pass Book and/or FDR
5. Acknowledgement of nomination (if any)

After the identification of nominee balance in account may be paid. The Incumbents have full
powers to sanction of payment/delivery of articles in accounts where nomination is available
including lockers. (For details refer the chapter of nomination)

Settlement of claim in Non-nominated Accounts

On receipt of the information that depositor has died the caution should be marked on AOF,
Specimen Signatures lip/system. The operation in the account should be stopped (if nothing
contrary to it is there in case of partnership accounts).
List of documents
- Death certificate (issued by competent authority)
- PNB 46-47 claim form (claim form can be signed by one major legal heir)
 - PNB 46-47 should be duly verified by Magistrate or Notary Public
- Power of Attorney in case of more than one claimants, duly verified by Magistrate or Notary
Public
- Indemnity bond by claimant (if required)
- Will/succession certificate (if required)
- Stamped full and final receipt
- Probate letter in case of will
Other guidelines

Value of claim not exceeding Rs. 5000/-: In far flung rural areas and where settlement of claim
cases involving small amount, claimant may find it difficult to get the claim form attested by a
Notary or Magistrate. In such cases where total amount does not exceed Rs. 5000/- and no legal
representation is produced, attestation of claim form need not be insisted upon. Instead claimant be
asked to obtain certificate from Sarpanch verifying the legal heirs.
Value of claim not exceeding Rs. 50000/-
In claim cases involving an amount/ value not exceeding Rs. 50000/- payment may be made to the
legal heirs of the deceased customer, after relying on the declaration made in the claim form about
the legal heirs of the deceased, duly attested by Notary/Magistrate. Payment can be made to legal
heirs/ claimants against execution of an agreement of indemnity In such cases, payment may be
made to legal heirs, relying on the declaration made in claim form duly attested by
Magistrate/Notary Public.

Payment can be made to the legal heirs on the execution of indemnity bond, Gold ornaments or other
security held against advances may be released on adjustment of advances
No confidential enquiry is needed.

Value of claim exceeding Rs. 50000/-

In claim cases involving amount exceeding Rs. 50000/-, confidential enquiry be made by the
Incumbent Incharge about the legal heirs of the deceased as disclosed in the form. Claim may be
settled and paid to the legal heirs of the deceased against indemnity bond and surety to the
satisfaction of the Incumbent.

Legal representation
No limit is prescribed below or beyond which legal heirs be asked to produce legal representation.
So, if the Incumbent is satisfied those legal heirs are identifiable and there is no dispute amongst the
legal heirs, there is no need of asking succession certificate. Claim may be settled on the basis of
indemnity bond and surety to the satisfaction of the bank. As a rule surety worth double the amount
of claim need not be insisted.

Death, Insolvency and Insanity of a customer: Notice or knowledge of death, insolvency or

insanity of a customer precludes the bank from paying further cheques on his account even though
these are dated prior to death, insolvency or insanity.
Joint Accounts
In case of joint accounts where operation is allowed by way of Either or survivor/Former or survivor,
the account will continue to run and payments can be made to survivors, unless at or before the time
of payment, order of court or other competent authority has been received prohibiting the payment to
the survivors. The survivor should be requested to transfer the balance into a new account in his own
name, singly or jointly.
When due to any reason if payment has been prohibited by competent authority, the balance in
account is not payable to survivor, the operation in the account must be stopped and treated as claim
case.
Partnership accounts:
Upon the death of a partner in a partnership, the operation in the account will be stopped. However,
if there is contract contrary to it (in the account opening form PNB-38 and/or partnership deed), the
account will continue to run. In case of termination of operations, the account will be treated as claim
case and legal heirs/partners will be asked to settle the claim.
Joint Hindu Family: In case of Joint Hindu Family account, when a death of a major co-parcener
occurs, the operation in the account will be stopped and dealt with as a claim case.

Power of Attorney
It happens many a time that all the legal heirs are not able to join in for execution of documents and
receiving payments. In such circumstances, those legal heirs who cannot join may execute power of
attorney in favour of one of the prescribed proforma for deposit accounts or locker accounts. The
Power of Attorney should be stamped as per the Stamp Act in force and duly notarized.
Power of Attorney if executed abroad, is required to be stamped in India within three months after
the same is received in India.
In case of Power of Attorney, the holder will sign execute the receipt and indemnity on behalf of self
and on behalf of the legal heirs who have authorized him. The name of executors should be
specified.
Any modification in the Performa, if required, may be got done in consultation and bank‟s
counsel/Law Officer at CO.
Settlement of Claim cases of the deceased customers of the Bank – Further simplification of the
procedure

As per the extant guidelines the claims of the deceased customers may be settled in favour of one of
the legal heirs of the deceased if the other legal heirs execute a Power of Attorney (duly notarised) in
his favour on the basis of which such authorized legal heir can sign the Claim Application Form for
himself and for and on behalf of other legal heirs as also execute Indemnity Bond / Letter and give
valid discharge to the bank by signing the Receipt in token of having received the proceedis of the
claim / contents of the locker. This facilitates smooth settlement of the claims as all the legal heirs
need not to join the claim settlement process and visit the branch. The purpose of obtaining the
duly notarized Power of Attorney is that there is a presumption in law that such a Power of
Attorney has been duly executed and the chances of raising dispute in respect of its due
execution are minimized.

Accordingly, it is advised that in respect of claims upto the value of Rs. 2.00 lac in place of existing
requirement of execution of Power of Attornery, a Power of Attorney or a Letter of Consent-cum-
Relinquishment, duly notarized /attested, may be executed by the legal heirs in favour of one of the
major legal heirs to lodge claim, to execute documents, to receive claim amount, etc. However, the
Branch Manager will verifiy the identity of the executants of the Letter to his satisfaction before
acting on the Letter of Consent-cum-relinquishment..
 CHEQUE COLLECTION POLICY
On the recommendations of IBA and BCSBI and directives of RBI, bank
formulated a policy on cheque collection and placed the same on website so
Background the public in general can have of the policy

Our commitment to provide better customer service

Set higher standards of performance
Transparency and fairness in treatment of customers
Objectives
Quick collection service to customers.

• Collection of cheques payable locally

• Time norms for collection of instruments
Coverage • Payment of interest in cases of delay beyond time norms
• Dealing with collection instruments lost in transit

Cheques/Negotiable instruments deposited at the counter or put in the boxes

within branch premises before cut-off time will be presented on the same day
and other cheques received after cut-off time will be presented in next
clearing cycle..
Credit will be afforded on the day clearing settlement takes
place. Withdrawals will be permitted as per Cheque Return Schedule of the
Clearing House. Wherever applicable Facility of same day credit can be
Local cheques provided to High Value customers.

Outstation Collection will be made through bank‟s own branches at the center. But in
Cheques case there is no branch, the cheque will be collected through other banks‟
branches.

Bank will also use National Clearing Service offered by RBI at specified centers.
Branches connected on CBS network will pay the cheques on the same day.

Outstation Speed clearing of RBI is available in all MICR centres. Cheques payable at any
Cheques CBS branches of any banks of any centres to be collected through local clearing
and not through outstation collection.
Collection will be made through bank‟s own branches at the center. But in case
there is no branch, the cheque will be collected through other banks‟ branches.
Collection of third Bank will also use National Clearing Service offered by RBI at specified centers.
Party cheque
Bank will not collect account payee cheques for any person othr than the
payee constituents.However,
1. Banks may consider collecting account payee cheques drawn for an
amount not exceeding Rs.50,000/- to the account of their customers who
are Co-operative Credit Societies, if the payees of such cheques are the
constituents of such Co-Operative credit societies.
2. While collecting the cheques as aforesaid, Banks should have a clear
representation in writing given by the Co-operative Credit Societies
concerned that upon realization, the proceeds of the cheques will be
credited only to the account of the member of the Co-operative Credit
Society, who is the payee named in the cheque.
3. This shall , however be subject to the fulfillment of the requirements of the
provisions of Negotiable Instruments Act 1881, including section 131thereof.

Cheques payable In case the bank has branch at the foreign center, cheque will be collected
in Foreign through that office.
Countries
The services of correspondent banks will be utilized in countries/centers where
correspondent bank has presence.
Otherwise cheques will be sent directly to the drawee banks for collection. The
proceeds will be received through Nostro account of the bank maintained with
one of the correspondent banks.
Speed Clearing
Branches situated at the center where there is no clearing house will present the
cheque across the counter and credit will be afforded at the earliest.

Immediate All branches and Extension Counters are authorized to consider providing
immediate credit for 3rd party cheques up to aggregate value of Rs.15000/-
Credit (Outstanding at any given point of time) tendered by:
Up to 15000/- • Individual account holders
• Staff members are also allowed.
• NRIs are excluded
• Minors are excluded
The facility is available for SF/CA & CC accounts of the customers.
Pre-Requisites:
The account should be opened at least 6 months earlier
KYC norms have been complied with
Conduct of account has been satisfactory.
 No cheques returned unpaid for which immediate credit was afforded
during past 3 months.
 There was no difficulty in recovery on account of cheques returned in the
past.
Bank to charge normal collection charges and out of pocket expenses
Bank shall levy normal collection charges and out of pocket expenses while
providing immediate credit against outstation instruments tendered for
collection. Exchange charges applicable for cheque purchase will not, however
be charged.
 Interest on cheques retuned unpaid
SF/CA: No interest will be payable on the amount so accounts credited.
Charging of
Returning charges and interest @ Clean overdraft rate will be charged on per
Interest on
day basis from the date of return till date of re-imbursement to the
cheques
bank/liquidation of OD.
returned unpaid
CC/OD. The interest applicable to the account will be accounts recovered from
where Instant
the date of affording such credit till date of return of the cheque. Further
Credit was
returning charges and interest @ clean overdraft rate or applicable rate to the
given
account whichever is higher will be charged till the reimbursement of the
amount or liquidation of Overdraft.
Time Frame Credit arising out of local cheques shall be given to the customer‟s accounts
for immediately after closure of the relative return clearing and withdrawal shall be
Collection of allowed on the same day or maximum within an hour of commencement of
Local Cheques business on the next working day, subject to usual safeguards.
The time Drawn on CBS branch and presented in Instant credit CBS branch Drawn on
frame for branches/other banks in Within 7 days Metro/state capitals Drawn on branches
collectio of in Other areas Within 10 days Drawn on other banks at other areas Within 14 days
outstation For delay over above periods interest to be paid.
Cheques Such instruments are drawn on best of efforts basis. Bank may enter into
drawn on specific collection arrangement with correspondent bank for speedy
foreign collection. Bank would give credit to the party on credit of proceeds to the
countries bank‟s Nostro Account with the correspondent bank after taking into account
cooling periods as applicable to countries concerned. The Above time norms are
maximum and applicable whether cheques/instruments are drawn on Bank‟s own
branches or other branches.
 Interest on delayed collection will be paid without any demand from the
customer in all types of accounts.
Saving/Current accounts
• SF rate for the period of delay beyond 7/10/14 days as the case may
be.
•FD rate as applicable for the period if delay is beyond 14 days but up
to 90 days.
•2% above FD rate if there is delay exceeding 90 days.
Overdraft/Loan accounts
•Interest at rate applicable to loan account if delay is up to 90 days.
Delayed
•2% above loan rate if delay is beyond 90 days
Collection
Payment of Interest to be paid if it amounts Rs. 10/- or more and instruments
Interest
Sent for collection in India.
Non CTS cheques:
Customer should be notified that in case of Non CTS cheques, there may be delay
in realization . Bank‟s is making efforts to withdraw the Non-CTS cheques in
circulation. However, there is still a large volume of Non-CTS-2010 format
cheques being presented in image ased clearing. In view of this, RBI has
decided to put in place the separate clearing session for clearing of these
cheques in CTS Centres. This separate clearing session will initially operate
thrice a week. Thereafter, the frequency of such separate session will be
reduced to twice a week and further to weekly once.
Instruments The instrument can be lost in transit or during clearing process or at the payee
L bank/branch, the bank shall take following steps:
ost • The loss will be brought to the notice of account holder immediately to
in Transit enable him to get the payment stopped.
• All assistance will be provided to the customer to obtain duplicate cheque
from the drawer.
Compensation
• In case intimation of loss is given to the customer beyond stipulated period
of 7/10/14 days, interest will be paid for the period in excess of stipulated
period.
• In addition, interest will be paid for further period of 15 days to provide for
further delay in obtaining duplicate cheque and collection thereof.
• The bank will also compensate to the customer any reasonable Charges
incurred in recording of Stop Payment instructions and getting a duplicate
cheque upon production of receipt.
Other Provisions • Bank will not pay any compensation if delay is due to reasons beyond Control
e.g lockouts, strikes, disturbances, accidents, natural disasters or any other
event.
• Customer need not make request for compensation.
• Incumbent In charge has full powers to pay compensation.
 COMPENSATION POLICY OF PNB

Objective To establish a system, whereby the customer is compensated for

the financial loss due to deficiency in service or an act of
omission or commission directly attributable to the Bank
Coverage The customer as far as possible will be compensated without
having to ask
for it. The policy covers compensation only for financial losses
which can be

Areas and Level of Unauthorized Debit

Compensation Payment of cheques after stop payment instructions

Standing Instructions not compiled for

Delay in Remittance

Delay in issuance of duplicate draft

Delay in collection of cheques

Instruments lost in transit

ATM Failure to dispense cash/short cash

Unauthorized Erroneous Debit Bank will reverse the entry immediately on being informed,
after verifing the position, maximum within 7 days (within 1
month if third party is involved. Any financial loss due to
returning of cheque or interest loss or charging of penalty for
not maintaining minimum balance on this account will be
compensated.
Incase, where neither bank nor customer is at fault, but fault lies
elsewhere (hacking/phishing) the compensation will be limited
upto Rs. 5000/- only.
Erroneous transactions reported by customers in respect of
Credit Card operations which require specific reference to a
merchant establishment will be handled as per rules laid down
by card association.

Where it is established that bank had issued and activated a

credit card without written consent of the recipient, the bank
would not only reverse the charges immediately but also pay a
penalty without demur to the recipient amounting to twice the
value of charges reversed as per regulatory guidelines in this
regard.
Payment of cheques after stop The bank will reverse such debit within 2 days of error coming
Payment instructions to notice. Besides, any financial loss due to returning of cheque
or charging of penalty for not maintaining minimum balance on
this account will be compensated
ECS Directo debits/other The bank will compensate the customer to the extent of financial
debits to a/c loss incurred on account of delay in carrying out the standing
instructions. In such case, charges debited in account will also
be reversed.

Delay in Collection of Interest for delayed collection shall be paid at the following
Outstation Cheques in India rates without any demand from customers:
If the proceeds to be credited to Savings Bank or Current
account:
 SF rate for delay up to 14 days.
TD rate for applicable period if delay is beyond 14 up to
90 days.
2% above TD rate if delay is beyond 90 days.
If proceeds were to be credited to OD/loan account:
Interest at rate applicable to loan account.
2% above loan rate if delay is beyond 90 days.
Interest will be paid only if the amount calculated is Rs. 10/- or
more. Rounding of up to the nearest rupee.
Delay in Collection of Cheques / The compensation on account of delays in collection of
Instruments/Bills (Payable instruments would be as per the FEDAI Rules
Outside India)
Delay in payment of Inward Banks are liable to compensate the beneficiary for delayed
Remittance payment of inward remittance in terms of FEDAI guidelines.
Bank will compensate the account holder in a way as indicated
Instruments lost in in Cheque Collection Policy. Further 15 days interest on the
Transit/in clearing house amount at SB rate to provide for likely further delay in
obtaining duplicate instrument. Compensate any reasonable
Delay in issuance Duplicate draft will be issued within 15 days from date of
of duplicate draft receipt of request from the applicant. In the event of
delay, interest @ FD rate of the corresponding period will be
paid.
Bank to reimburse the customer, the amount wrongfully
debited on account of failed ATM within a maximum period of
7 working days from the receipt of the complaint. For any
failure to re-credit the customer’s account within 7 working
days from the date of receipt of the complaint, bank shall pay
compensation of
ATM Failure to Rs.100/- per day. This compensation shall be credited to the
dispense cash/short cash Customer’s account, on the same day when bank affords the
credit for the failed ATM transactions. Customer is entitled to
receive such compensation only if claim is lodged within 30
days of the date of transaction. Further, this is applicable for
domestic ATM transactions only. Details of charge back in
case of ATM transaction by a customer of the bank when he
uses other bank ATM may be included.
All the pensioners are compensated for the delayed period, if
delay is on the part of the bank, beyond the due date at the
Delay in disbursement of
bank rate + 2% penal interest. Compensation shall be credited
revised pension and arrears
automatically without any claim from the pensioner on the
same day when the bank affords the credit.
Violation of the Code by Matter to be investigated and informed the finding to customer
bank‟s agent within 7 days from the date of complaint and if justified,
compensation to be paid for any financial loss to customer.
 GRIEVANCE REDRESSAL POLICY
Background On the recommendations of IBA and BCSBI and directives of RBI, bank
formulated a Grievance Redressal policy and placed the same on website
www.pnbindia.in so the public in general can have view of the policy.
Principals of • Fair treatment to customers
policy • Prompt redressal of customers‟ complaints
• Information about avenues to escalates grievances by customers within
the organization.
• Rights of customers to alternative remedy
Complaint A complaint is expression of dissatisfaction with regard to products/services
offered by the organization. The complaint may arise due to :
• Attitudinal aspects in dealing with customers.
Deficiency of service
Misbehaviour/rude behavior with customers
shall be treated at Zero Tolerance Level
• (CCC Cir. No.6/2015 dt.10.06.2015)

Internal 1. Customer Service Committee of Board

Machinery to Customer Service Committee of Board will be ultimately responsible
handle for rendering compliant free customer service in the bank to both depositor and
complaints borrower. The sub-committee would formulate different policies, conduct
surveys and audit of customer service at branch level. This committee will also
review functioning of Standing Committee on customer service.

2. Standing Committee on Customer Service

This committee will be chaired by ED of the bank. The committee would
include
2-3 senior executives of the bank besides 2-3 public representatives. The
committee will perform the following functions:
• Evaluation of feedback on quality of customer service
• Implementation of commitments in Code of Bank‟s commitment to
Customers
• Ensuring that all regulatory instructions regarding customer service are
being followed.
• Consideration of un-resolved complaints and offering advice.
• Submission of report on its performance to Customer service
Committee of Board on quarterly basis.
Nodal Officer A nodal officer appointed at HO/Circle level is responsible for implementation
and other of customer service and handling of complaints. The names, addresses and e-
Officers mail contact numbers of all nodal officers will be made public.
Code Our bank has adopted BCSBI‟s code of bank‟s commitment The copy of code
Compliance is being provided to each customer and displayed at website. Bank has
Officer designated
a GM as Principal Code Compliance Officer at HO level and code compliance
officer at each controlling office. The name and address of code compliance
officer will be displayed at each branch.
Registration of A customer may lodge complaint either in writing or over telephone or through
Compliant e-
mail. The record of the complaint will be kept for 3 years and
due acknowledgement will be sent to the complainant.
Written complaint
The complaint may be made in writing on simple paper or on complaint form
(available with branches). The complaint forms have also been provided at
bank‟s website www.pnbindia.in. The customer can also obtain complaint book
from the BM and record its grievances. The complaint-cum suggestion box can
also be used by the customer.
Telephonic complaint: The customer can ring the BM or the Chief Host of
controlling office whose name, address and phone no. will be displayed at the
branch.
Customer Relationship Center: The customer can approach the Customer
Relationship Center of the bank in Gurgaon over Toll Free Number 1800 180
2222 assessable over landline BSNL 24 hours a day. The contact number for
Mobile Users as well as for Landline users other than BSNL is 0120-2490000
which is a paid number.
E-mail complaints: The customer can submit complaints on e-mail also to
Nodal Officer whose e -mail address is displayed at each branch.

Resolution of The BM is ultimately responsible for resolution of the complaint. Consequent

Grievances & upon his failure to do so, next higher authority will find suitable solution to
Education to address the issue within a reasonable time. The acknowledgement will be
the customer sent within maximum period of 1 week. Bank’s endeavor will be to resolve
the issue at earliest possible. However if it requires some time to examine the
matter, final response will be submitted within 6 weeks of receipt of the
complaint. In case, the customer is not satisfied with the remedial action
taken by the bank, he will be informed to adopt any of the following
recourse.

1. Directorate of Public Grievances, Govt. of India located at Cabinet

Secretariat, Sansad Marg, New Delhi
2. Banking Ombudsman located in state capitals. The customer may
approach if his grievances are not redressed by the bank and 1 month has
elapsed since lodging of complaint with the bank.
Interaction The bank will arrange personal interaction with the customers to remove their
with the misgivings as under:
Customer 1. Personal Hearings
On 15th of every month between 3 to 5 PM, any customer can meet BM
without any prior appointment.
2.Customer Service Committees
The customer service Committees have been set up at branch level, Circle
level
and HO level. Customer meets are arranged once in a month and customers
are
invited therein once in a quarter.
3. Customer Relationship Programmes
 CODE OF BANK’S COMMITMENT TO CUSTOMERS BY BCSBI
The Banking Codes and Standard Board of India ( BCSBI) has been established
Concept as an independent and autonomous body to watch, monitor and ensure that banking code and
standards adopted by different banks in India are in accordance
with the prescribed standards and these are being adhered to in true spirit.
• To promote fair banking practices by setting minimum standards in dealing
with the customers.
• To enhance transparency so that better understanding between banker and
Objectives customer can be achieved.
• To encourage market forces through competition.
• To promote air and cordial relationship with the customers.
• To create confidence of the customers in the system.
1. Applicability Although it is a voluntary code, yet PNB has adopted it for implementation so that
higher standards of Customer Service can be attained. This code underlines the
rights of a customer and their reasonable expectations from the bank. Our
GM(OPSD) is principal Code Compliance Officer. The branches have been
provided with sufficient copies of the Code for distribution thereof
among the customers. The code is also available on website
www.pnbindia.in In the code, “you” denotes the customers and “we” denotes the
bank.
2.Commitments • To act fairly and reasonably in all our dealings with the customers.
• To help the customers understand how our financial products and services
work.
• To help the customers use the accounts and services.
• To deal quickly and sympathetically with things those go wrong.
• To treat all personal information as private and confidential.
• To publicize the code.
3. Information The customer can get information on Notice Board, Telephone, Website or
from branch officials regarding:
• Interest rates
• Tariffs, fees and charges
• Changes in fees and charges
• Terms and conditions and changes therein.
The persons who intend to become customers are also welcome to get information
about our products and services.
For the existing customers, if bank has made any change without notice, the same
will be notified within 30 days. If such change is to the disadvantage of the
customer, he/she may close the account within 60 days without notice or switch it
without having to pay any extra charges or interest.
4.Advertising, The bank will ensure that all the advertising material for promotion of business is
Marketing and clear, understandable and not misleading. A separate code for Direct Selling
Sales Agents (DSAs)
5. Privacy And The information relating to customers‟ accounts will be treated as private and
Confidentiality confidential except in the cases where the disclosure is compulsory under law or
where bank‟s interest is involved e.g. in fraud. The information can be passed on
to credit information agencies provided there is written consent from the customer
and there is due intimation to the customer.
6.Collection Of Whenever a loan is given to the customers, repayment process and schedule is
Dues And intimated to the customers. If a customer does not adhere to the schedule, bank
Repossession Of
Security will follow the procedure of recovery as per law of land. But the recovery process
will be courteous and fair with privacy. Sufficient notices will be served before
taking any legal action. Security Repossession policy will be followed in
consonance of law.
7.Complaints, There is proper procedure of lodging complaint over telephone to Call Center, by
Grievances and post to branch/administrative office or through website. The grievances will be
Feedback. redressed quickly and fairly. Final response will be sent to the customer without
delay. In case the issue is not addressed within 30 days,
the complainant will be free to approach the Banking Ombudsman of the area
whose name and address will be displayed on the Notice Board.

8.Products and There is complete information with regard to different products of the bank as
Services. under:
• Types of deposit a/cs such as Current, Savings, FD & RD.
• Mode of Operation i.e. Single, Joint or other.
• Procedure regarding opening of accounts and operation thereof.
• Changing and transfer of account of the customers
• Minimum balances charges and Statement of accounts.
• Pre-mature withdrawal and renewal of Overdue FDs.
• Advance against deposits
• Accounts of Minors and other special accounts
• No Frills accounts and accounts of Senior Citizens.
• Inoperative and Dormant accounts and Closure thereof.
• Clearing Cycle and Collection services.
• Cash Transactions.
• Standing Instructions and Stop Payment Facility.
• Branch Closure and shifting of premises.
• Settlement of deceased claims
• Safe Deposit Lockers & Forex services
• Lending, Loan Products , Guarantees and Credit Cards
If customer is not happy about choice of current or saving account within 14
days, bank will help him switch to another of bank‟s accounts or money will be
returned with interest applicable and without levying any charges. Under normal
circumstances, the account will not be closed without giving notice of 30 days.
Examples of circumstances, which are not normal include improper conduct of
the account. In such cases, the customer will be required to make alternative
arrangement for cheques already issued and desist from issuing further cheques in
the account.
Notice of 3 months will be given if bank plans to close the branch. However
notice period will be reduced to 2 months if any other bank/branch is
operating in the area.
Time limit for settlement of claims is 15 days from date of submission of claim
forms.
Bank will take all reasonable steps to protect the accounts of the customers
9. Protecting through reliable banking and payment system. The customer is also required to
Accounts of adopt following precautions.
Customers • Keep the bank Up-to-date with regard to name, address, phone no. and E-
mail address.
 • Check Statement of Account/ Passbook regularly and inform the bank
about any discrepancy.
• Not to keep cheque book and cards together and refrain from keeping
blank
cheque leaves signed.
• Not to write down any PIN, password or security information.
• Choosing of PIN carefully and keeping them secret.
• Inform the bank immediately about any loss of Card/Cheque book.
• Take care of Cheque books/cards and Passbooks and other security
information.
• Visit Internet Banking site directly and do not use any other link site to
open IBS. Ignore any E-mail asking PIN/password. Also do not use Cyber
Cafe for IBS.
• Change Password frequently and log off PC when not in use.
10. Monitoring BSBI having directors from the Governing Council will monitor implementation
of the Code in different banks. The BCSBI is situated in RBI Building at
Mumbai.
11. Getting Help The customers having any enquiry may call at toll free number 1800-180-2222
of Call Center Noida or IBA office situated at Mumbai.
The code will be reviewed by BCSBI with in a period of 3 years in a
12.Review of transparent
Code manner.
Lockers shall be issued to the customers to the extent of 80% of total on the
13. Lockers basis
of First Come First Serve and the remaining 20% would be issued as
per
discretion of the BM. All the applications received for issuance of lockers will
be
acknowledged. Waiting list will be prepared and waiting list number be
allocated
to the applicants as per the code approved.
The customer will be at liberty to continue the account with the branch/bank at
Closure of his
Deposit account will. However, if he requests for closure of account, the same will be complied
immediately. In case, the request for closure of the account through any other
branch of the bank or other bank, the account will be closed within maximum 5
working days.
Transfer of If the customer makes request to transfer the account to another branch of our
Account bank, the bank will do so and ensure that the account may be
operationalised within 2 weeks.
 RIGHT TO INFORMATION ACT 2005

Right to information Act (RTI), 2005 has come into force in India (except J&K) w.e.f.
October, 13, 2005.
What is RTI: U/s 2-j, It is right to information available to Indian citizens to access the
information (including inspection) under control of the public authorties.

Who can get the information: Only citizens of India can get information from Public
authorities.
Hence, the information seeker will have to give his citizen status while seeking the
information.

Information (Sec2-f): It means the material in any form i.e. records, documents, memos, e-
mail, opinions, advices, press releases, circulars, orders , log books, contracts, reports, papers,
samples, models, data material held in any private body that can be accessed by a Public
Authority under any law for the time being, in force, Sections 8 & 9, provide for certain
categories of information that is exempt from disclosure.

Coverage/Public Authority (Sec 2-h): Public Authority under RTI Act, means any authority
or institution established under the Constitution, law made by Parliament/ State Legislature or
by notification issued or order made by the appropriate Government. It includes large
departmental undertakings including Railways, Telecom, Postal Services, Passport and
Banking.

Obligations to maintain and publish information (Section 4): Every Public Authority is
required to maintain all its records duly catalogued and indexed in a manner and in the form
which facilitates the right to information under this Act and ensure that all records that are
appropriate to be computerized are, within a reasonable time and subject to availability of
resources.

Who is to provide information: Each organization will have Public Information Officer to
provide this information who is to route the requests to the relevant departments.

Banks obligation under the Act: Reserve Bank of India and public sector Banks are a pubic
authority as defined in the Right to Information Act, 2005. As such, they are obliged to
provide information to members of pubic.

How to make an application under the Act: Citizens of India will have to make the request
for information in writing, clearly specifying the information sought under the RTI Act, 2005.
The application for request should give the contact details (postal address, telephone number,
fax number, email address) so that the applicants can be contacted for clarifications or the
information.

Fee for seeking information: A request for obtaining information under Section 6(1) is to be
accompanied by an application fee of Rs. 10.
Reply: Requests for information will be way of letters or eMail to be sent to PIO. Response
must come in 30 days. For cases concerning life and liberty, it must come within 48 hours.

Rejections: Rejection has to be in writing, giving reasons.

1. PNB PRUDENT SWEEP

Saving Account Scheme providing facility of automatic transfer of balance

from Savings Accounts to Fixed Deposit.

USP OF PRODUCT

 Cut off level for Sweep: Rs. 100000 .

 Multiples of minimum Sweep Out/In: Rs. 10,000/- Last In First Out Basis
(LIFO) Method.
 Tenor of FDR: 7 days to 1 Year

FACILTIIES

 Free 100 cheque leaves in a financial year.

 Free Remittance Facility - Maximum Amount of Rs.25000 p.m.
 Free Collection of Outstation Cheques maximum Rs.25000 p.m.
 50% concessions De-mat services for first year only.

2. TOTAL FREEDOM SALARY ACCOUNT

USP OF PRODUCT
 Opening of account with zero balance. No QAB required
 O/D facility upto Rs. 50,000/- or last salary credited in the account, whichever
is
lower.
 50% discount in one locker (Small or Medium) at the branch convenient to
customer for 1st year only
 50% discount on D-mat account maintenance charges levied by bank for first
year
only.
 50% concession in processing fee/ documentation charges for availment
of Housing/Car/Personal loan upto 31.03.2016

FACILTIIES

Free Cheque: 40 cheques leaves free per annum.

Free Statement of Account.
Free issuance of all types of certificates including interest certificate and
balance
certificate.
 Free of Cost issuance of PNB Debit/ATM Card; however, annual charges shall
be recoverable.
 RTGS/NEFT Transaction: Free if routed through the account.
 No commission for DD up to Rs.25000/- p.m. And free transfer Rs. 1 lac per
day to branches.
3. PNB RAKSHAK

Salary account scheme for all Defence Personnel (Army, Naval/Air Force), BSF,
CRPF, CISF, ITBP & other Para-Military Institutions like Indian Space Research
Organization (ISRO), Defence Research & Development Organization (DRDO),
CSD Canteen, State Police, Metro Police, IB, CBI, RAW and Indian Coast Guard
etc.

USP OF PRODUCT
 Opening of account with zero balance. No QAB required.
 Over Draft facility upto sum of last two months net salary.
 Free ATM/Debit Card, accident insurance cover Rs. 2 lacs to Rs.5.00 lac this
also cover active Army operation.
 No AMC charge for ATM/Debit Card any transactions upto Rs. 50000/- per
day
 Concession in locker charges for small locker by 25% for 1st year only
 Instant credit of outstation cheque upto Rs.25000/-
 5% concession in margin requirement on Home loan upto Rs 50 lacs only

FACILITIES

 Sweep out over Rs. 10000/- in multiples of Rs. 1000/- for 7 to 179 days.
 RTGS/NEFT Transaction free if routed through the account.
 Free Cheque leaves for routine use.
 Free Statement of Account.
 Free issuance of all types of certificates including interest certificate and balance
certificate

4. PNB SHIKSHAK SWEEP SCHEME

Salary account scheme for all Permanent Teachers of recognised Schools /

colleges/ educational institutes are eligible to open account under the scheme

USP OF PRODUCT

 Opening of account with zero balance. No QAB required.

 Sweep in & out over Rs. 15000/- in multiples of Rs. 1000/- for 7 to 179 days.
 Overdraft facility upto Rs. 50,000/- or last salary credited in the account,
whichever is lower.
 50% locker charges for small locker & no Demat charges for 1st year only.
 Concession in margin requirement on Home Loan (Upto Rs.50 Lacs only) and Car
loan: 10%.

FACILITIES

 Free ATM cum Debit Card.

 Free: 3 DDs of Rs. 25000/- each from salary a/c. Free SIM in same branch.
 Free Collection of Salary/TADA/Arrears/Terminal Dues & 3rd Pt chq. 20000/-
 RTGS/NEFT/ Intersol Transfer: Free
 5. PNB SMART BANKING CURRENT ACCOUNT PRODUCT

VARIANTS

Particulars
PNB PNB PNB PNB
SILVER GOLD DIAMOND PLATINUM
Minimum Quarterly Average
100,000 5,00,000 10,00,000
Balance (QAB)
2,00,000
Initial Deposit 5,000 5,000 5,000 5,000
Non Maintenance of QAB
150 600 1500 3,000
Charges (per quarter)
Minimum Balance for Sweep-
1000000 1000000 10,00,000 10,00,000
in and Sweep-out facility
Sweep-in and Sweep-out in
50000 50000 50000 50000
multiples of
Tenor of Term Deposit
15 to 91 days
(At applicable card rate)
Free Cheque Leaves
100 200 300 600
(per quarter)
Free Collection of outstation
0.50 lac 2.00 lac
Cheque per quarter maximum 5.00 lac 10.00 lac
uptoRs.
per per
per quarter per quarter
quarter quarter
(Issued in favour of customer)
5 nos 10 nos 30 nos
15 nos
Issue of Free Demand Drafts (Max. Amt. (Max. Amt. (Max. Amt.
(Max. Amt.
per quarter upto upto upto
upto
Rs.0.50 Rs.2.00 Rs.10.00
Rs.5.00lacs)
lacs) lacs) lacs)
Advance against clearing /
25,000 50,000 1,00,000 2,00,000
Purchase of local cheque upto
RTGS/NEFT Free Free Free Free

6. SUGAM TERM DEPOSIT

 Amount of Deposit: Initial Deposit of Rs.10000/- only, and thereafter in

multiples
of Rs.1/- with a maximum amount of Rs.10 Crore.
 Period of Deposit: For period ranging from 46 Days to 120 months.

USP OF PRODUCT
  Facility to withdraw any amount before maturity in multiples of Rs.1000 any
time without breaking the entire deposit and without losing interest on the
remaining deposit under the scheme
 Payable at all Branches (Only on Maturity). Conversion from other scheme for
more than remaining period
 Premature renewal/Extension in the period before maturity is permitted
 Part withdrawal allowed.
 No penalty on prepayment part/ full withdrawal
 DL/OD for deposits of Rs. 10000/- & above permitted.

7. PNB SAKSHAM

PNB SAKSHAM product takes care of the recurring financial needs of the depositors
over and above the interest income accrued on term deposit by way of regular
monthly payout consisting of interest plus part of principal.

 Amount of Deposit: Minimum Rs.25000/- and thereafter in multiple of Re.1/-

subject to maximum of Rs. 10 crore.
 Period of Deposit:: 12 months to 120 months in multiple of 3 months

USP OF PRODUCT

 Regular monthly payout consisting of interest plus part of principal.

 Amount of withdrawal: Minimum withdrawal amount Rs. 1,000/- per month,
thereafter in multiple of Re.1/-.
 Disbursement/Withdrawal: In the shape of monthly pay out consisting
interest plus part of principal during tenor of term deposit.
 Two variant in the scheme:
 Variant I: The monthly pay out will start one month after the date of
deposit.
 Variant II: Deposit will be kept in the shape of FDR and monthly
payment will start one month after date of maturity of FDR.
 No pre-payment penalty in case of pre-mature cancellation of the deposit.

8. PNB TAX SAVER

 Rebate on Income Tax U/S 80 (benefit will be for First Holder only).
 Amount of Deposit: Minimum Rs. 100/- or in multiples, maximum Rs 1.50 Lac
per
financial year.
 Period: Minimum 5 year and maximum 10 year.

USP OF PRODUCT

 Interest Option: Income on Monthly/Qtly/Hly/Yearly or on Maturity.

 Nomination : Available
 TDS on Intt is applicable as per IT Act Provisions : Sec 194 A or 195
 Loan/OD: May be permitted after lock in period i.e. after 5 years.
 Payment at all branches on maturity.
9. RECURRING DEPOSIT

RD schemes provides an opportunity to build up savings through regular monthly

deposits over a fixed period of time with twin advantages of affordability and higher
returns.

 Account can be opened with Rs.100/- and in multiples thereof. No maximum

limit
 6 months to 120 months in multiple of 1 month.

USP OF PRODUCT

 Encourages savings without stress on finances.

 High rates of interest (identical to the fixed deposit rates).
 Loans against deposits available.
 Withdrawals on maturity or one month after deposit of last installment,
whichever is
later.
 Free accidental death coverage to the extent of Rs. 2.00 lacs

FACILITIES

 Payment of RD at par.
 SMS Alerts for missed installments.
 50 Reward points on opening of account from IBS.
 Free accidental death coverage to the extent of Rs. 2.00 lacs.

10. FLEXI RD

 Core monthly instalment minimum of Rs. 100/- & its multiples, no ceiling.
 Maximum deposit 10 times of core amount in a month
 Period 6 months to 120 months, even may be in days also.
USP OF PRODUCT

 Encourages savings without stress on finances.

 High rates of interest (identical to the fixed deposit rates).
 No penalty on missed/late instalment.
 No premature penalty for Staff/Sr. Citizen/Death of Depositor.
 Payable at par all CBS branches on maturity & No inter-sol charges.
 Loans against deposits available at base branch only.
 Intt shall be applied on daily product basis.
11. FD SCHEME FOR ROAD ACCIDENT VICTIMS
 Depositor will automatically get additional rate of interest as applicable to
Sr.Citizen on attaining age of 60 years.

 Period of Deposit: For any period 12 months to 120 months.

 Automatic Renewal: The auto renewal will be done for the period prescribed
by the court
 USP OF PRODUCT

 Interest: 1% above CARD rate of interest as applicable for normal Fixed

Deposit scheme for various Tenors.

12. PROSPECTIVE SENIOR CITIZEN TD SCHEME

 Age 55 years + individuals (singly or jointly) with others.
 In case of joint deposit, the prospective Senior Citizen has to be first account
holder of the Term Deposit.
 Minimum deposit of Rs. 100/- and thereafter in multiples of Rs.1/- with
maximum amount of Rs. 99.99 Lac.
 Period of deposit: 1 year to maximum of 10 years even for incomplete quarter.

USP OF PRODUCT

 Depositor will automatically get additional rate of interest applicable to

Sr.Citizen on attaining age of 60 years.
 Both income (monthly/quarterly) & maturity options.
 At PAR Collection of Fixed Deposit Receipt
 Payable at all Branches (Only on Maturity)
 Loan/Overdraft facility available
 Automatic Renewal is permitted. Extension of fixed deposit is permitted
 No penalty on premature cancellation when depositor becomes Sr. Citizen.
 Conversion to any other Term Deposit scheme is allowed.

13. PNB POWER SAVINGS SCHEME

Any resident individual woman who is otherwise eligible to open a saving fund account can
open
the “PNB PoWer Savings” account either singly or jointly provided in joint account, the
first
name should be of woman.

USP OF PRODUCT

 25% concession in locker rent for first year only.

 Domestic cash-ATM withdrawal per day Rs 50000.
 No documentation charges for availment of Housing Loan, Vehicle Loan
(two wheeler/Car) & Personal Loan

FACILITIES

 Free 40 cheque leaves per half year.

 No NEFT charges.
 No SMS Alerts charge.
 Free one draft per month- upto Rs.10,000/-
 14.PNB RAKSHAK RECURRING DEPOSIT SCHEME
Additional facility for opening of Recurring Deposit Scheme has been
designed to encourage the defence personnel to save a part of their salary
regularly to build funds for meeting margin requirements for acquiring
housing
accommodation at an appropriate time.
 Minimum monthly installment of Rs. 1000/- or more in multiples of
Rs.100/-.No maximum limit.
 Period from 60 months to 120 months, in multiple of 3 months.
 The interest shall be payable at the CARD rate applicable to term
deposits below Rs. 1 Crore.

USP OF PRODUCT

 Encashable at any time without premature penalty, if the proceeds are

utilised as margin towards Housing loan to be availed from our bank.
 Payable At Par on maturity at all CBS branches.
 Loans against deposit available.

15.PNB SF PRUDENT SWEEP DEPOSIT SCHEME FOR THE ACCOUNTS OF

INSTITUTIONS

USP OF PRODUCT

 Cut off level for Sweep: Rs. 1000000 .

 Multiples of minimum Sweep Out/In: Rs. 100,000/- Last In First Out Basis
(LIFO) Method.
 Tenor of FDR: 7 days to 1 Year

FACILTIIES

 Free 100 cheque leaves in a financial year.

 Free Remittance Facility - Maximum Amount of Rs.25000 p.m.
 Free Collection of Outstation Cheques maximum Rs.25000 p.m.
Free retail internet banking services.
 RETAIL LOAN SCHEMES AT A GLANCE
S.N. Particulars & purpose of the Eligibility Loan amount Margin Repayment Other important Features including
scheme Charges/ Fee
1. HOUSING LOAN : Individuals & Joint owners  Construction/Addition/ Loan up to Rs. 75  Construction/ Purchase/ Rate of Interest
 To meet the financial requirement (18-70 years) having regular Purchase of house/ lac- 20% Addition /built up house or Floating: @ MCLR+0.05%,
of individuals to construct/ source of income. flat: Need based. flat/land/ plot – Max.30 years presently 9.45% irrespective of loan
purchase new/ old house/flat/plot.  Land/Plot: Rs.50 lac. Loan above Rs 75 inclusive of moratorium period amount
 To carry out repairs/ renovations/ Circle Head & above may (Rs 100 lac in Metros/ lac- 25% Fixed: 0.50% over Floating ROI with
additions/ alterations/ furnishing. relax repayment period up State Capitals by CH  Repairs/ Renovation/ reset of 5 years.
to the age of 75 years only and upto Rs.500 Purchase of Land/ Alteration – Max.15 years
Operative Circulars*: lacs by FGMCAC). Plot – 25% inclusive of moratorium period Upfront fee: 0.50% Max. Rs.20000
63/2015  Repairs/Renovations/alte for loans upto Rs.300 lac.&
rations: Rs.25 lac (Max.) Net Deductions Rs.50000/- for loans above Rs.300
 Furnishing: 10 % of Monthly Allowed lac.
Housing Loan-Rs.5 Salary/
lac (Max.) Income** Documentation charges:
 Premium of Optional Up to 40% Rs.1350/-.
Group life insurance Rs.30000
coverage can also be >Rs.30000- 50%  Mortgage of house/ flat/ plot
financed subject to Rs.60000 purchased.
availability of LTV. >Rs.60000- 60%
Rs.100000  Income of Father/ mother/ spouse
>Rs.1 lac 70% & earning children can be added
Circle Head/COCAC & above, for repaying capacity.
shall permit higher %age
deduction of NMS/I subject to  Where Property cannot be
Maximum 10% over & above the mortgaged, loan may be granted
prescribed ceiling under each after accepting alternate collateral
bracket security.

Max. Moratorium period :  Projects approved by

For Construction/ Additions of SBI/HDFC/LICHFL and PNBHFL
House/ Flat- 18 Months treated as fast track approval.
For carrying out repairs/
renovation / alterations to the
house/flat-6 Months
For purchase of ready built
House/ flat OR land/plot- 3
Months.
For under-construction
flats/houses built by approved
private builders- max 36 Months
or possession of flat, whichever is
earlier subject to repayment of
interest on monthly basis.
2 PNB GEN-NEXT Housing Loan: AGE: One borrower must 1.25 times the loan As per regular 30 years. Repayment
 For purchase of ready to move in be of Max.40 years and amount calculated as Housing loan  Moratorium Period During Only Interest
others may be upto 45
house/flat etc.;
years.
per the regular housing  In case of under Moratorium to be
 For construction of House/flat loan method. construction flat of serviced
etc.; All salaried class having 3 approved private builder: Next 120 EMI on
 For purchase of under years experience and Net Min. Rs.20 lac; & Max. Upto 36 months plus months sanctioned
construction flat of approved salary of Rs.35000/- Need Based. remaining period of date of limit for 360
private builder; possession subject to a months
maximum moratorium period Remaining EMI which will
Circular: 17/2015 dated 31.03.16 fully amortize the
of 60 months. Period remaining
 In all other cases: Max. 36 outstanding in the
months housing loan
account within
 However, interest is to be
the remaining
serviced as and when levied period
during the moratorium period. All other terms and conditions
shall be applied as per regular
housing loan scheme for public.
2. Earnest Money Deposit Scheme: Individuals as well as Joint 100% of EMD subject to NIL To be adjusted in lump-sum on MCLR+0.10% i.e. presently 9.50%
To deposit Earnest Money (EMD Owners maximum of Rs.15 lac. declaration of allotment process p.a.
Scheme) for booking/ allotment of Plot/ through refund order/ Housing
Flat/ House under the Schemes loan or through own sources, as {6 months Interest on loan amount to
floated by State Housing Boards/ the case may be in bullet be recovered upfront refundable on
Urban Development Authorities. payment.
completed month basis.
Circular:65/15*
FGM may reduce it to 3 months.
4. PNB FLEXIBLE HOUSING Customer below 50 years of  As per Housing Loan Same as Housing Term Loan- As per Housing Loan
 As per Housing Loan Scheme, age. Scheme at S.No.1. Loan (Public) Scheme As applicable to Housing Loans
S.N.1 above, except for purchase Disbursement of loan:  Overdraft component: For
of land/plot. Term Loan-80% borrower –
Overdraft-20%. Below 55 years – Servicing of
 After 5 years, additional Loan for  Overdraft limit can be interest as and when charged,
Personal needs allowed. enhanced maximum i.e., on monthly basis till the age
upto 50% of the total of 55 years.
Operative Circular*:64/15 loan amount 55 years & above- On monthly
sanctioned. reducing drawing power Max.
 First enhancement Upto the age of 65 years.
allowed after 5 years
up to 20%.
 Extent of
enhancement equal to
reduction in Term Loan
account.
5. OVERDRAFT FACILITY TO All Housing Loan borrowers – Minimum : Rs.50,000/- 20% & 25% on Account to be renewed annually. Rate of Interest: MCLR+0.60%%.
HOUSING LOAN BORROWERS FOR new /existing/ takeover cases.( Maximum: Rs.25 lac. realizable value of
PERSONAL NEEDS except for purchase of plot/ House/ Flat subject to Upfront fee – NIL
 For Personal needs/ use under construction houses/ repaying capacity.
flats) Documentation charges– Rs.450/- +
Operative Circular*: 66/15 Taxes
6. MORTGAGE LOAN:  For Personal Needs: For Personal needs: 25% Max. 120 EMIs Rate of Interest: MCLR+1.75% to
Income Tax Assesses, Min.- Rs 1 lac (up to the age of 65 yrs. In case 6.00% (depending on the score/
Term Loan OR Overdraft on monthly below the age of 60 yrs. Max.-Rs 5 lac of individual borrowers, rating of the borrower)
reducing DP.  Business Enterprises whichever is earlier). Further concession of 0.25% to
Minimum net annual For Business needs: 0.75% depending upon the value of
For Personal & Business needs. income/ net profit of Min.– Rs.5 lac security (Above 200% of the loan
Rs.120000/- for last 3 years Max. – Rs.500 lac. amount)
Operative Circular*: 61/2015 Processing Fee – 0.90%
 75% of Realizable Max.45,000/- + taxes.
Value of IP; Doc. charges– Rs.1500/- + Taxes
 3 or 4 times Annual Equitable Mortgage of self-occupied
Gross Income; or vacant residential/ commercial/
 Net Income should be industrial property. Income of
1.5 times of EMI/ spouse/ earning children/ parents/
Interest+ principal partners/ Directors can be added for
repayment assessing repaying capacity and
Whichever is least income of spouse/ earning children/
parents/ partners can be added for
assessment of Limit/ Loan Amount.
7. CAR LOAN SCHEME:  Individuals & business Individuals- 25 times net In case of Tie up New vehicles – 84 months Rate of interest:
To purchase: concerns (corporate and monthly salary/income. arrangement with Floating: For women:-
a) New Car/ Van/ Jeep/ MUV/ SUV. non-corporate). Max. Rs.100 lacs Manufacturer / Old vehicles – 60 months MCLR+0.25%
b) Old Car/Van/ Jeep/ MUV/ SUV,  Minimum net monthly Dealer: 10% of For others:
which is not other than three years salary/ Pension/ Income Business Concerns: Need on-road price OR Net Monthly Max. MCLR+0.35%, if PNB Score 60 &
(Depreciation @ 15% p.a. on – Rs.20, 000/-. based. NIL on Ex- Salary/ Permissible above or 100% collateral security;
current invoice/ showroom price showroom price Income** Deduction of - For others MCLR+0.60%.
at straight line method). NMS/I Fixed: MCLR+0.50% with reset
For others: Up to 40% clause of 3 years.
Operative Circular*: Rs.30000 Processing & Documentation
56/15 new vehicles – >Rs.30000 to 50% charges: 1.00% Max. Rs.6000/-.
15% of on road Rs.60000
price >Rs.60000 to 50% Third party guarantee, wherever
Rs.100000 applicable.
old vehicles – 30% >Rs.100000 60%
Circle Head/COCAC & above, Income of spouse/ parents/Earning
. shall permit higher %age children can be added, subject to
deduction of NMS/I subject to maximum one.
Maximum 10% over & above
the prescribed ceiling under
each bracket.
8. Two Wheeler Loan:  Individual: In service Max. Rs.1,00,000/- 10% (Salary through For Scooters/M-Cycles – 60 EMIs. Rate of Interest : MCLR+3.10% to
(PNB SARTHI) minimum net monthly salary For Scooters/ Motorcycles. Bank/ Check-off For Scooters – 30 EMIs MCLR +4.60%%
For purchase of new scooter/ motorcycle/ of Rs.10,000/-. Rs.10, 000/- for Mopeds. facility) For Mopeds – 24 EMIs Processing Fee – Rs.275/- + taxes (for
moped to public.  Students – Salaried parent to Net Monthly Max. students- NIL)
be made co-borrower. Circle Head/ COCAC & 25% (Business Salary/ Permissible
Operative Circulars*:  Business Concern above is empowered to Concerns) Income** Deduction of Documentation charges- Rs.275/- +
57/15  Income of Spouse can be consider and sanction 2- NMS/I taxes.
added. Wheeler Loans of above Up to 40%
Rs.1 lac within their vested Rs.30000
loaning powers. >Rs.30000 to 50%  Third party guarantee.
Rs.60000  Hypothecation of vehicle.
>Rs.60000 to 50%  Joint Registration & Insurance of
Rs.100000 vehicle with Bank clause.
>Rs.100000 60%
Circle Head/COCAC & above,
shall permit higher %age
deduction of NMS/I subject to
Maximum 10% over & above
the prescribed ceiling under
each bracket.
9 Two wheeler Loan to Women (PNB Salaried/ Self employed/ Max. Rs.60000/- 10% on Ex- Max. 36 months ROI- MCLR+1.60%
Power Ride) Studnt with parents as co- showroom price Upfront Fee:- Rs.500/-
borrowers Documentation charges:- NIL
Other: Income min. Rs.8000/- p.m.
10. EDUCATION LOAN: Need based loan with Margin: upto 4lac: PNB Saraswati, Pratibha & Rate of Interest:
(Four Schemes) Indian Nationals following ceilings: NIL & above 4 lac: Udaan:  Loans up to Rs.
PNB Saraswati: 5% in India; 4.00 lac:
For pursuing higher, professional and PNB Saraswati: 15% abroad. 15 years with moratorium period MCLR+2.10
technical education in India.  Max. Rs.10 lac for Nil for PNB equal to course period + 1 year.  Above 4 lac to
studies in India. Kaushal. 7.50 lac:
PNB Udaan:  Circle Head have Security- PNB Kaushal: MCLR+3.10
For pursuing higher, professional and powers to consider need Co-obligation for For loans upto 50000/- 3 years  Above 7.50 lac:
technical education abroad. based loans above these parents and for loan From above 50000/- to Rs.1 lac- 5 MCLR+2.60%
PNB Pratibha: For students of 161+ ceilings. Upto Rs.4 lac – NIL years; &  MCLR+1.10%
Premier institutes in India. Above 4 to 7.50 lac – Above 1 lac:- 7 years. where collateral
PNB Kaushal: For pursuing Vocational PNB Udaan: Third Party guarantee security is 100% or
Education & Training/ Skill development  Max. Rs.20 lac for Above Rs.7.50 lac – Moratorium: above, irrespective
courses of duration of 2 months to 3 years studies abroad. Tangible collateral For courses of duration upto 1 year - of loan amount.
Operative Circulars*:  Circle Head have security of suitable 6 months from the completion of the  MCLR+0.10%
PNB Saraswati:109/15 powers to consider need value. course. under ‘PNB
PNB Udaan: 111/15 based loans above these Pratibha and under
PNB Pratibha: 110/15 ceilings Under PNB For courses of duration above 1 year PNB Udaan for
PNB Kaushal: 78/15 Pratibha- co- - 12 months from the completion of 201 premier
PNB Pratibha : Up to obligation of the courses. foreign Institutes.
Rs.20 lac Parents only  Processing Fee –
FGM may permit 50% NIL for studies in
higher amount. India. 1% with
PNB Kaushal: Max. Min. Rs 10,000/-
 Rs.1.50 lac. for studies abroad
( refundable)
Documentation
charges upto Rs.4
lac – Rs.270/-
+taxes; and
Over Rs.4 lac-
Rs.450/- + taxes.
 Reimbursement of
fee available.
 Simple Interest
during studies/
moratorium
period.
 1% Interest
concession
available against
servicing of
interest
 0.50% interest
concession for
female students
under Priority
sector.
11. Education Loan Scheme: Credit All Education loans upto  As per Education loan As per Education  As per Education loan scheme  0.50%
Guarantee Fund Scheme for Education Rs.7.50 lac without security scheme loan scheme guarantee fee
Loans and guarantee will be borne by
the Bank.
 The Fund shall
provide
guarantee cover
to the extent of
75% of the
amount in
default and
would be settled
as under:
 75% of the
guaranteed
amount will
be paid
within 30
days and the
balance
 25% will be
paid after all
avenues for
 recovery have
exhausted.
12. PERSONAL LOAN FOR Pensioners (Ex-employees of  Min. Rs.0.25 lac, Max. Nil  Max. 60 months  Rate of Interest:
PENSIONERS: our Bank & DPDO pensioners Rs.10.00 lac or 18 times  For pensioners above 75 years –
(TL/ Overdraft with monthly reducing DP) included) drawing pension Net Monthly pension, 24 months. TL/DL/OD:
To meet personal needs. through our branches. whichever is lower. Net Monthly Max. MCLR+2.60%
Salary/ Permissible
Operative Circulars*: Income** Deduction of  Upfront Fee-
60/15 NMS/I NIL.
Up to
Rs.30000  Documentation
>Rs.30000 - charges –Rs.500/-+
Rs.60000 50% taxes
>Rs.60000 -  Guarantee
Rs.100000 of spouse eligible
>Rs.100000
for family pension
Circle Head/COCAC & above,
shall permit higher %age to be obtained.
deduction of NMS/I subject to  Where
Maximum 10% over & above loan is given to
the prescribed ceiling under
each bracket family pensioners,
guarantee of earning
children (Preferably
Govt. employee) to
be taken. If no
earning children,
Third party
guarantee with net
means of equal or
more than loan
amount, to be taken.
13. PERSONAL LOAN:  Individuals drawing salary  Min. Rs.0.50 lac – Max. Nil  Max.60 months or remaining Rate of interest:
(TL/ Overdraft with monthly reducing DP) thru’ our Bank/ availing Rs.10 lac period of service, whichever is MCLR+3.10% to
To meet all type of personal needs. loan under check-off Max Rs 5.00 lac or 20 times of earlier. MCLR+6.10%
facilities net monthly salary whichever is Net Monthly Max. depending upon
lower with minimum Net Salary/ Permissible whether the borrower
For (i) Permanent/ Confirmed employees Monthly Salary as under: Income** Deduction of
of Defense/ Central/ State/ P{SUs/ is having salary
Metro Centres: Rs.15000/- NMS/I
Reputed Companies/ Schools/ Colleges/ Urban Centres: Rs.12500/- account and/or check
Up to 30% off facility
Doctors with annual income of Rs 4.00 lac SU/ Rural Centres:
Rs.10000
Rs.30000
& above) >Rs.30000 to 40%
(For teachers and defence Upfront Fee –
personnel min. net monthly Rs.60000 1.80%+taxes.
Operative Circulars*: income is Rs.7500/- all Centres). >Rs.60000 50%
59/2015 Documentation
Max. Rs.10.00 lac, or 15 times Rs.100000 charges - upto Rs.2
monthly Net Salary whichever is
 lower, with minimum Net >Rs.100000 60% lac – Rs.270/- and over
Monthly Salary as under: Circle Head/COCAC & above, shall Rs.2 lac – Rs.450/- +
Metro centers: Rs.50000/- permit 10% higher taxes.
Urban centres: Rs.40000/-
SU/ Rural Centres:
Rs.30000  Suitable
guarantee
acceptable to the
Bank.
 Irrevocable letter
of authority
authorizing the
employer to remit
salary-cum-letter
of
acknowledgemen
t from employer.
14. LOAN AGAINST GOLD/ Individuals/ Business Productive – Need based 25% Demand Loan – Maximum 12 Rate of interest:
JEWELLERY/ ORNAMENTS Enterprises Non-Productive – Rs.10 lac months. MCLR+1.60% to
/COINS: (Max.) (Agriculture and Non agriculture) MCLR+2.60%
 Advances may be granted to borrowers
against security of Gold Jewellery Overdraft – Renewed annually. Processing Fee –
/ornaments/ Coins (Weight of gold coins Interest to be paid as and when 0.70%+taxes
not to exceed 50 gms per customer) levied.
 For productive and non-productive Documentation
purposes as DL/OD. charges –
Op. Circulars*:58/15 Rs.270/- +taxes upto
Rs.2 lac*
Rs.450/-+taxes over
Rs.2 lac*

15. PNB BAGHBAN – A scheme for House Sr. Citizens who are 60 years  Max. Rs.100 lac (along Loan to be recovered only after the Rate of interest:
Owning Senior Citizens under Reverse & above and owner of with interest) to be paid death of both the spouses. MCLR+2.60%
Mortgage Concept residential House / Flat. monthly on reverse annuity 20% (Fixed, subject to re-
basis.
- For generating income / ( Self Occupied Residential No loan repayment during the set clause of 05 years)
 Lump sum amount Max. 15
supplementing pension/ other income property ) lac permitted for medical
lifetime of the borrower.
for day to day requirement. exigencies of the borrower, Processing Fee – Half
Operative Circular*:62/15 spouse and dependents, if month Loan Installment
any. with Max. Rs.15,000/- +
taxes.
 Monthly payments to be Documentation Fee–
allowed for a period NIL.
between 10 to 20 years. Security: Equitable
Mortgage of Self
Occupied Residential
property.
 IMPORTANT MSME SCHEMES
(1 a.) SCHEME FOR FINANCING MSME MANUFACTURING UNITS-‘PNB
NIRMATA’
1. PURPOSE
WORKING This covers the cost of raw material, components, spares, stores, etc., and
CAPITAL processing of raw materials, marketing of finished products, etc. by way of bills
purchased and discounted and book debts (not older than 3 months) etc.
TERM LOAN : For acquiring fixed assets like land, factory building, plant and machinery
by new enterprises and in case of existing units for expanding factory
accommodation, renovating and modernizing the existing factory with a view to
improving the quality or reducing production cost, creating additional
infrastructure facilities, like setting up of Research & Development Centres
/ Testing Laboratories, purchase of vehicle (other than the vehicles meant for
personal use) which are required exclusively to meet production and marketing
needs of the unit etc.
2.ELIGIBILITY Individuals / Partnership / Ltd Liability Partnership / Pvt. Ltd. Co. / Public
Ltd.Co/Trust and Co-operative Societies.

3.EXTENT OF (i) Cash Credit- Need based, (ii) Term loan-Need based.
FINANCE
4.FACILITY / MARGIN Upto Rs.2 Lakh Above Rs. 2 Above Rs.5 Lakh
Lakh to Rs.5
lakh
CC (H) NIl 20% 25%
CC(BD) 25% 30%
TL(Land/Builiding/Construction) 25%
TL (P&M) Nil 20% 25%
5.REPAYMENT
Working capital Shall be sanctioned for a period of one year and shall be renewed annually.
limits
Term Loan Repayment period would be 5 to 7 years depending upon the project
profitability over and above the gestation period of 6 to 12 months.
6 .SECURITY
PRIMARY Mortgage / Hypothecation / pledge / assignment etc. of assets (land / building /
 P&M / stocks / book debts (not older than 3 months) created out of the loan.
COLLATERAL
Situation Extent of Collateral Security

Where land &/or building has No additional collateral security is required, in case where
been financed and mortgaged as land and/or building of factory is financed by us and land
primary security. and building is mortgaged as primary security having
realizable value of atleast equivalent to 133% of total
exposure. If there is any shortfall, additional collateral in
the shape of Liquid security/IP will be taken.

Where Bank is not financing In respect of such advances collateral security by way of
Land &/or Building and either mortgage of immovable properties or 3rd party guarantee
only WC is sanctioned and/or may be asked for in those cases, where sanctioning
TL is sanctioned for Plant & authority feels that the primary security would be
machinery only and land and/or inadequate to safeguard Bank’s interest or for other valid
building is not mortgaged with the reasons so that Bank’s interest is protected and not as a
Bank as in above case. matter of routine.

(1.B.) SCHEME FOR FINANCING MSME SERVICE UNITS-‘PNB SEVA’

1. PURPOSE
WORKING To finance stocks and other current assets, receivables (not older than 3
CAPITAL months), future receivables, business expenses including salary/wages of
(In the shape of employees, etc.
CC/ OD)
TERM LOAN : For acquiring fixed assets like land, office/workplace building, equipments &
infrastructure (by new enterprises) and in case of existing units for expanding
office/workplace accommodation, renovating and modernizing the existing
office/workplace with a view to improving the quality or reducing service cost,
creating additional infrastructure facilities, like setting up of Research &
Development Centres / Testing Laboratories, purchase of vehicle (other than the
vehicles meant for personal use) which are required exclusively for rendering
service and marketing needs of the unit, future receivables.
2.ELIGIBILITY Individuals / Partnership / Ltd Liability Partnership / Pvt. Ltd. Co. / Public
Ltd.Co/Trust and Co-operative Societies.

3.EXTENT OF (i) Cash Credit- Need based, (ii) Term loan-Need based. (iii) Over draft limit-
FINANCE Need based.

4.FACILITY / MARGIN Upto Rs.2 Lakh Above Rs. 2 Above Rs.5 Lakh
Lakh to Rs.5
lakh
CC (H) NIl 20% 25%
CC(BD) 25% 30%
OD against staff salary/wages & 25%
other such expenses
TL(Land/Builiding/Construction) 25%
TL (P&M) Nil 20% 25%
5.REPAYMENT
Working capital Shall be sanctioned for a period of one year and shall be renewed annually.
limits
Term Loan Repayment period would be 5 to 7 years depending upon the project
profitability over and above the gestation period of 6 to 12 months.
6 .SECURITY
PRIMARY Mortgage / Hypothecation / pledge / assignment etc. of assets (land / building /
P&M / stocks / book debts (not older than 3 months) created out of the loan.
COLLATERAL
Situation Extent of Collateral Security

Where land &/or building has No additional collateral security is required, in case where
been financed and mortgaged as land and/or building of factory is financed by us and land
primary security. and building is mortgaged as primary security having
realizable value of atleast equivalent to 133% of total
exposure. If there is any shortfall, additional collateral in
the shape of Liquid security/IP will be taken.

Where Bank is not financing In respect of such advances collateral security by way of
Land &/or Building and either mortgage of immovable properties or 3rd party guarantee
only WC is sanctioned and/or may be asked for in those cases, where sanctioning
TL is sanctioned for Plant & authority feels that the primary security would be
machinery only and land and/or inadequate to safeguard Bank’s interest or for other valid
building is not mortgaged with the reasons so that Bank’s interest is protected and not as a
Bank as in above case. matter of routine.

2. SCHEME FOR FINANCING PROFESSIONALLY QUALIFIED MEDICAL

PRACTITIONERS – “PNB SANJEEVANI”
1. PURPOSE
To finance for purchase of various surgical, X-Ray, CT Scan etc. and other Electro Medical
equipments including other sophisticated equipments. Loan can also be allowed for Operation
Theatre equipments, Air Conditioners, Generators, Refrigerators, Ambulances, Computer
and accessories, software necessary for diagnostic purposes and UPS systems or for purchase of
equipments, machineries, purchase of vehicles, and any other items to start Clinics/Nursing
Homes/Medical Centres.To set up Reproductive Child Health care centers in Semi Urban/Rural
Centres.

Finance can also be allowed for purchase, construction, addition, alteration, renovation,
furnishing of Clinics / Nursing Home / Medical Centres (Including Land for Clinics / Nursing
Home / Medical Centres. However, it must be ensured that land is not used for any other commercial
purpose), cost of medicines if any to be procured and day to day operations like salaries etc.

Overdraft (Max Rs.1 crore):

CM and above may consider sanction of loan by way of overdraft (subject to maximum of Rs 1
crore only).
2.ELIGIBILITY Qualified Doctors: (Allopathic (including Physiotherapist), Unani, Ayurvedic,
Homeopathic) & registered practitioners, having minimum qualification:
MBBS/ BAMS/BPT/ BDS/ BHMS/BUMS.
Constitution: Individuals/ Partnership/ Ltd Liability Partnership/Pvt.
Ltd.Co/Ltd.Co/ Trust.

For constituents other than Individual and trusts a minimum 75% of stake
(Equity in case of Pvt. Ltd.Co/Ltd. Co) should be from qualified doctors.

In case of trusts at least 75% of the trustees should be qualified doctors. This
minimum stake/Equity/Number of qualified doctors in the borrowing unit shall
be ensured throughout the tenure of loan.
3.EXTENT OF Need based
FINANCE Minimum Rs 1 Lakh
 Subject to the condition that Value of Equipment (as per MSMED ACT 2006)
existing and proposed shall not exceed Rs. 5 Crore.
4.FACILITY / MARGIN
Term loan /OD 25%
5.REPAYMENT
Overdraft (Max CM and above may consider sanction of need based loan by way of overdraft
Rs.1 crore) (subject to maximum of Rs. 1 crore only). The loan is to be repaid in maximum
7 years, through a monthly reducing DRAWING POWER (DP), the reduction to
commence from the month following the month up to which moratorium period,
if any, has been allowed.
Term Loan Maximum 7 years in equal Monthly/Quarterly instalments inclusive of a
maximum moratorium period of 6 months. However, a higher moratorium
period of 18 months may be allowed in case of construction of nursing
home/clinic/medical centre.(Where Land is purchased for construction of
Clinics/ Nursing Home/Medical Centres, the construction should start within a
period of 6 months and should be completed within moratorium period.)
6 .SECURITY
PRIMARY Hypothecation of equipments / items purchased/Equitable mortgage of land and
building of Clinics / Nursing Home / Medical Centres in case the loan is for
acquiring/constructing Clinics/Nursing Homes/Medical Centres.
COLLATERAL Loans up to Rs. 10 Lakh:
No Collateral & Third Party Guarantee. To be covered under Credit Guarantee
Scheme of CGTMSE.
Loans above Rs.10 Lakh up to Rs. 20 Lakh (if not covered under Credit
Guarantee Scheme of CGTMSE):
Third Party Guarantee.
Loans above Rs 20 Lakh (if not covered under Credit Guarantee Scheme
of CGTMSE):
Collateral Security: Equitable mortgage of immovable property equivalent to
100% of loan
amount.
No collateral security is required, in case where land and / or building of
Clinics / Nursing Home / Medical Centres is financed by us and land and
building is mortgaged as primary security and adequately covers the loan
 amount (at least equivalent to 110% of loan amount).
REPAYMENT Term Loan: Maximum 7 years in equal Monthly/Quarterly instalments
inclusive of a maximum moratorium period of 6 months. However, a higher
moratorium period of 18 months may be allowed in case of construction of
nursing home/ clinic/ medical centre.
Overdraft
The loan is to be repaid in maximum 7 years, through a monthly reducing
DRAWING POWER.

3. SCHEME FOR FINANCING TO TRADERS – “PNB KUSHAL VYAPARI”

(A) FINANCING OF STOCK/RECEIVABLES(NOT OLDER THAN 4 MONTHS)
1. PURPOSE
WORKING FINANCING OF STOCK/RECEIVABLES(NOT OLDER THAN 4
CAPITAL MONTHS)

2.ELIGIBILITY Traders, who are individuals, firms (Proprietorship/Partnership), HUFs,

Companies, Co-Op. societies registered under any law relating to cooperative
societies .

Promoters /co-obligants must have existing satisfactory relationship of

minimum / at least six months with the Bank.
3.EXTENT OF Working Capital (fund based & non-fund based) - Need Based.
FINANCE
4.MARGIN Working Capital Limit:
Against Stocks : 30%- 40%,
Against Receivables : 40%

5.REPAYMENT
Working capital Working Capital Term Loan (WCTL) upto Rs.5 lakh will be repayable in equal
limits monthly/quarterly installments within a period of 3 to 5 years.

Working capital shall be sanctioned for one year, renewed/reviewed annually.

6 .SECURITY
PRIMARY Legally enforceable charge by way of hypothecation/ Pledge / assignment etc.
 on stock / book debts / fixed assets / block assets of the borrower.
COLLATERAL Legally enforceable Equitable / Registered Mortgage of IP / Pledge or creation
of charge on liquid security having realisable value equal to the amount of
loan.

However, in case of loans /limits up to Rs.10 lakh to traders in MSE

(service) sector, advance should be secured by way of suitable third party
guarantee and mortgage of IP may not be insisted upon. In case the mortgage
of IP is offered by third party, the intending mortgagor be made guarantor in the
account.
B. FINANCING TRADERS FOR PURCHASE/CONSTRUCTION OF SHOP &
SHOWROOM /ACQUIRING OF ASSETS FOR FURNISHING OF SHOP & SHOWROOM
LIKE PARTITION, FIXTURE AND FURNISHING ETC/ PURCHASE OF AIR-
CONDITIONERS, OTHER GADGETS AND DELIVERY VAN
PURPOSE Financing traders for Purchase/Construction of shop & showroom/Acquiring of
assets for furnishing of shop & showroom like partition, fixture and
furnishing etc/purchase of air-conditioners, other gadgets and delivery van
required for running the business by units/Individuals undertaking Trade
activity.
(Construction of shop/showroom shall be permitted on the plot owned by the
borrowing firm/company or proprietor/partner of borrowing firm.)
LOAN Term Loan :Need based subject to the following:
AMOUNT
Location of Unit For For acquiring of assets for furnishing of shop & showroom
Construction / like partition, fixture and furnishing etc/ purchase of air-
Purchase conditioners, other gadgets and delivery van.
In case of owned In case of leased/rented
shop/showroom- Need shops/showrooms - Need based
based & subject to the & subject to the ceiling of
ceiling of 15% of limits following limits i.e
mentioned for
construction purpose in
col. (2) i.e
Maximum Maximum (Rs. In Maximum (Rs. In Lakh)
(Rs. In Lakh) Lakh)
(1) (2) (3) (4)

At Metro/Urban 500 75 20
Centre
At Semi-Urban 100 15 5
Centre
At Rural Centre 25 3.75 3
MARGIN 25%
SECURITY
PRIMARY Equitable / registered mortgage of the shop / showroom purchased.

COLLATERAL Extension of charge on security obtained for considering working capital

limit And Suitable guarantee. However, CHs may waive obtaining of
guarantee on merits.
REPAYMENT Term loan -3-10 years including moratorium of 6-12 months.

SPECIAL
FEATURES
Rate of Interest ALCO in its meeting dated 31.08.2015 has approved the following
concessions in ROI subject to minimum effective rate of interest after
applying concessions shall not be below the base rate.
 Available Realizable Value of Collaterals  Concessions in prescribed ROI
 Above 50% & upto 75% of loan amount  25 bps (0.25%)
 Above 75% & upto 100% of loan amount  50 bps (0.50%)
 Above 100% & upto 125% of loan amount  75 bps (0.75%)
 Above 125% & upto 150% of loan amount  100 bps (1.00%)
 Above 150% & upto 200% of loan amount  125 bps (1.25%)
 Above 200% of loan amount  150 bps (1.50%)
4.PNB ARTISANS CREDIT CARD SCHEME
1. PURPOSE Adequate and timely assistance to the artisans to meet their credit requirements
both investment as well as working capital needs.

2.ELIGIBILITY •
All artisans involved in production/ manufacturing process (and otherwise
eligible for credit facilities for carrying out the proposed activities under
any of the existing bank schemes).
• Preference would be given to artisans registered with Development
Commissioner (Handicrafts).
• Thrust in financing would be on clusters of artisans and artisans who have
joined to form Self Help Groups (SHGs/JLGS).
• Beneficiaries of other Government sponsored loan schemes will not be
eligible for coverage under ACC scheme.
• All existing artisan borrowers of the bank enjoying credit facilities upto
Rs.2 Lakh and having satisfactory dealings with the bank will be eligible to
avail credit facilities under the scheme.
3.EXTENT OF Term Loan & Working Capital ( both upto Rs. 2.00 Lakh)
FINANCE
4. MARGIN Nil
5.REPAYMENT The term loans will be repayable in monthly/quarterly installments within 3 to
5 years depending upon the project’s profitability over & above the gestation
period of 6 to 12 months.
Yearly review shall be done by the incumbent in-charge on the basis of the last
12 months turnover of genuine trade transactions, in case of working capital
limits.

6 .SECURITY No collateral securities be obtained from the borrower(s) of PNBACC

holder(s). However, all accounts are to be covered under Credit Guarantee
Scheme of CGTMSE.

5. PNB WEAVER CREDIT CARD SCHEME

1. TARGET GROUP
ELIGIBILITY All new weavers and ancillary workers involved in weaving activities .

Preference would be given to weavers identified by Development

Commissioner (Handlooms), Ministry of Textiles as well as to weavers
identified by the State Governments.

Thrust in financing would be on clusters of weavers.

All existing weaver borrowers of the Bank.

2.EXTENT OF Need based, subject to ceiling of Rs. 2.00 lakh per borrower.
FINANCE
4. MARGIN MARGIN:
Upto Rs.25000/- : Nil
Above Rs.25000/- : 20%
5.REPAYMENT The term loans will be repayable in monthly/quaterly installments within 3 to 5
years
depending upon the project profitability over & above the gestation period 6 to
12 month.
6 .SECURITY
Primary security Hypothecation of stock in trade, receivables, machinery, office equipment, etc.,
as specified for existing limits.
Collateral No Collateral securities be obtained from the borrower(s) of PNBWCC
Security holder(s), however all accounts are to be covered under Credit Guarantee
Scheme of CGTMSE.

Govt. Support Margin money support upto Rs 4,200/- per weaver

And / Or
Interest subsidy upto 3% on bank loans
And / Or
Reimbursement of Annual guarantee fee as applicable for a period upto 3 years
payable for guarantee cover under CGTMSE.

VALIDITY : The PNBWCC will be valid for 3 years subject to annual review.
Yearly review shall be done on the basis of last 12 months turnover

6.PNB REVISED GENERAL CREDIT CARD (GCC) SCHEME

1. PURPOSE The objective of the scheme is to increase the flow of credit to individuals for
entrepreneurial activity in the non farm sector provided through the General
Credit Card.
2.ELIGIBILITY All non farm entrepreneurial credit extended to individuals which is eligible for
classification under the priority sector guidelines.
3.NATURE OF The credit facility extended under the Scheme will be in the nature of revolving
FACILITY: credit through cash credit account.
- WC
- WCTL, in case it includes Term loan component also.
- WCTL is to be given on reducing DP basis.
4. RENEWAL (i) The PNB GCC will be valid for 3 years.
OF THE (ii) Limits will be reviewed annually on similar lines as normal cash credit
CARDS: account.
(iii) The card will be renewed at least one month before expiry of the current
card on
a simple hand written request from the card holder.

5.EXTENT OF The need based limit be fixed with a maximum of Rs. 10 Lakh, on case to case
FINANCE basis, after analyzing credit needs and repaying capacity of the borrower.
6. MARGIN Nil
7.REPAYMENT GCC limit shall be repayable in 12 months with the following stipulations;
(a) Aggregate credits into the account during 12 months period should at least
be equal to the maximum outstanding in the account.
(b) No drawal in the account should remain outstanding for more than 12
months.
8 .SECURITY
Primary security Personal security of the borrower / asset created by the bank finance.

Collateral NIL, to be covered under CGTMSE for eligible activities.

Security

7. PNB VANITA: SCHEME FOR FINANCING WOMEN FOR ANY ACTIVITY FOR
INCOME GENERATION

1. PURPOSE & To empower and encourage women for income generation for activities either in
ELIGIBILITY manufacturing/ service/ trading/ small business etc. Preference will be given to
women belonging to ST/ SC/ BPL CATEGORY.
2.EXTENT OF Amount of composite loan has been restricted upto Rs. 25,000/- only with
FINANCE purpose to finance for setting up new unit / enterprise or for expansion /
modernization of existing unit; for acquisition of fixed assets (Plant &
Machinery, equipment, furniture & fixtures);

To meet working capital needs for purchase of various products

/equipments/tools etc. to meet their day to day requirements.

3. MARGIN Nil
4.REPAYMENT 3-5 years with maximum moratorium of 3 to 6 months depending upon type of
activity & income generation.
In case ODMUD – MUDRA Card credit facilities to be reviewed annually.
5.SECURITY
Primary security Personal security of the borrower / asset created by the bank finance.

Collateral NIL, to be covered under CGTMSE for eligible activities.

Security

8. PNB SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS

(A) SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS : LOAN

FOR NEW VEHICLES

1. PURPOSE To assist transport operators (existing as well as new entrants) and to

provide self employment opportunities by making cheaper and easier
credit available for purchasing Trucks, buses, Taxi cars, auto-rickshaw,
tempos, Three wheelers or station wagons to be plied for commercial
transportation of passengers and goods..
2.ELIGIBILITY 2.1. An individual, transporter operator, an association, Sole Proprietor,
Partnership firms, Private Ltd. Companies, Public Ltd. Companies
desirous of owning transport vehicle(s), for carrying passengers or
goods on hire, are eligible for financing under the Scheme.
2.2. The borrower (s) hold the necessary driving license or engage
driver (s) possessing valid license to operate the type of vehicle for
which credit is sought.
2.3. While financing Owner Driver of Trucks, buses, taxi-car, three-
wheeler, auto rickshaw, pick-ups, station wagons or tempo, it must be
ensured that the borrower necessarily hold a valid driving license to
operate the type of vehicle for which credit is sought and have arranged to
buy a vehicle in their own names.
2.4. The borrower(s) should possess a valid permit to ply vehicle(s) for
passengers or goods. Permit can be obtained at a Post- sanction stage,
wherever it is not possible to obtain it at a pre-sanction stage to ply
commercially as per the laws of that particular State.
3.EXTENT OF 85% of on road price i.e. Cost of chasis, construction of body plus fare
FINANCE meter, insurance, registration & taxes etc.
4. Margin 15% of on road price i.e. Cost of chasis, construction of body plus fare
meter, insurance, registration & taxes etc.
5.REPAYMENT The advance(s) with interest will be repaid in a maximum period of 60
months bymonthly instalments, starting from the date when the vehicle is
 put on the road for commercial use or after completion of two months
from the date of advance, whichever is earlier.
6 .SECURITY
PRIMARY Hyp. of Vehicle purchased
COLLATERAL (i) For Loans up to Rs. 10 lakh:
Micro & Small Enterprises
Loans upto Rs 10 lakh to micro and small enterprises must be covered
under Credit Guarantee Scheme of CGTMSE without accepting any
collateral security/third party guarantee.
Medium Enterprises
Advance should be secured by way of suitable third party guarantee.
(ii) Loans above Rs.10 lakh
Collateral security equivalent to amount of advance by way of Equitable
mortgage of immovable properties or Pledge of FDRs/NSCs/IVPs/ KVPs
or Pledge of other bankable security like shares/debentures/bonds of
adequate value Or Third party guarantee(s) having adequate means is to
be obtained Where CGTMSE cover is not obtained as explained above.
CREDIT RISK The loans under this category are exempted from Risk Rating and should
RATING be treated as BB Rated Borrowers (B1 under revised grades) or borrowers
having scores (Retail/SME/Agri)>52<=58 and pricing will be decided
accordingly.

(B) SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS :

SANCTION OF SECOND TERM LOAN.
1. PURPOSE For purchase of tyre, repair of body, chassis, engine etc
2.ELIGIBILITY Existing borrower(s) under the Scheme whose vehicle has been damaged
on account of natural calamity.
OR
Vehicle has been damaged on account of accident where comprehensive
insurance policy is available and claim has actually been filed with
Insurance Company.

Such loan will be extended to only those borrowers whose accounts are
regular.
3.LOAN AMOUNT Need based, but the total amount of loan shall not exceed 25% of the
original loan sanctioned to the borrower.
4.REPAYMENT 36 monthly installments.
5.GUARANTEE AND The charge on the existing security may be got extended to cover the
SECURITY: additional loan. However, in case existing security is not adequate to
cover the total loan, additional security / guarantee may be taken on merits
of each case.

C. SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS : LOAN TO

OLD VEHICLES.
1.PURPOSE Loan for old vehicles.
2.ELIGIBILITY Advances will not be allowed for the purchase of a vehicle which is more
than 3 years old.
Old Vehicle must be road worthy.
Valuation of the vehicle for the purpose of advance should be the
prevalent price of the new vehicle less depreciation @ 20% p.a. for a
period starting from the date when the vehicle was first put on the road or
the value assessed through some independent agency like the Automobile
Association, whichever is less. Depreciation should be calculated on
quarterly basis taking part of a quarter to be full quarter. As for example,
if the period after the vehicle was first put on road comes to 16 months it
should be taken as six quarters.
3.LOAN AMOUNT 75% of the depreciated value of the vehicle.

4.MARGIN 25% (on the depreciated value calculated @20% p.a. on the prevalent cost
price of new vehicle or market value, whichever is lower)
5.REPAYMENT Repayment will start one month after the disbursement of the loan as
under:-
1 year old :48 months;
2 years old :40 months;
3 years old :30 months;

(D) SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS : OVER

DRAFT LIMIT TO SMALL ROAD TRANSPORT OPERATORS.
1.PURPOSE To meet the day to day expenses for purchasing fuel/oil/repairing of
 vehicles and other personal needs
2.ELIGIBILITY An individual or association owning vehicle.
3.LOAN AMOUNT (i) Overdraft Limit with maximum Rs.50,000/- for one vehicle and Rs.50,
000/- per vehicle to Fleet Owners, with ceiling on maximum amount upto
Rs.10 lakh per borrower. However, need based Overdraft Limit to be
allowed only to transport operators under MSME.
(ii).Overdraft Limit will be available for vehicles costing Rs. 5 lakh and
above.
4.MARGIN: For Over Draft Limit up to Rs. 25,000/- - NIL
For Over Draft Limit Above Rs.25000/- - 10%
5.REVIEW/RENEWAL The Over Draft Limit is to be reviewed & renewed yearly.
OF OVER DRAFT
LIMIT

9. “SCHEME FOR FINANCING E-RICKSHAWS” – “PNB GREEN - RIDE”-MICRO,

SMALL & MEDIUM ENTERPRISES– SERVICE SECTOR

(A) SCHEME FOR ADVANCES TO SMALL ROAD TRANSPORT OPERATORS : LOAN

FOR NEW VEHICLES

1. PURPOSE To assist transport operators of e-rickshaws (new entrants) and to create

employment opportunities for the micro borrowers particularly.
2.ELIGIBILITY 2.1. An individual, transport operator, an association, Sole Proprietor,
Partnership firms, Private Ltd. Companies, Public Ltd. Companies
desirous of owning transport vehicle(s) viz. E-Rickshaw, for carrying
passengers or goods on hire, are eligible for financing under the Scheme.
2.2. The borrower (s) hold the necessary driving license or engage driver (s)
possessing valid license to operate the type of vehicle for which credit is
sought.
2.3. The borrower(s) should have been granted a permit by an appropriate
authority to ply vehicle(s) for passengers or goods transportation. Permit can be
obtained at a Post sanction stage, wherever it is not possible to obtain it at a
pre-sanction stage. Due precaution be taken for obtaining the copy of permit at
pre sanction stage or post sanction stage as the case may be and its authenticity
 must be ensured.
2.4. It must be ensured that the vehicle to be financed is allowed to ply
commercially as per the laws of that particular State and vehicle must be
indigenous.
3.EXTENT OF EXTENT OF LOAN
FINANCE For New E-Rickshaw: a) Maximum 85% loans of the invoice cost of the
vehicle .or 80% of On road price, whichever less.
b) Battery replacement after one year
- 85% of replacement cost
c) Battery replacement after two years
- 85% of replacement cost
Total TL including batteries will be sanctioned in the beginning. The TL for
batteries will be disbursed through the same account after one and two years
subsequently. The EMI will be fixed in such a way that total TL is adjusted in
33 months.
4. Margin For New E-Rickshaw: a) Minimum 15% of the invoice cost of the vehicle or
20% of On road price, whichever higher.
b) Battery replacement after one year
- 15% of replacement cost
c) Battery replacement after two years
- 15% of replacement cost
5.REPAYMENT The advance(s) with interest will be repaid in a maximum period of 33 months
by monthly instalments, starting from the date when the vehicle (purchased
with the amount of the loan) is put on the road for commercial use or after
completion of one month from the date of advance, whichever is earlier.
6 .SECURITY
PRIMARY Vehicle purchased with the amount of the loan will remain hypothecated to the
bank as security of the advance
COLLATERAL (i) For Loans up to Rs. 10 lakh:
No collateral & third party Guarantee and these loans are to be covered under
Credit Guarantee Scheme of CGTMSE
(ii) Loans above Rs.10 lakh to Rs. 50 lakh:
Wherever collateral security is available, Incumbents in all the scales are
empowered to sanction the loans, as per extant guidelines. However if any
 eligible loan is proposed to be covered under CGTMSE, prior concurrence is
obtained from CIRCLE HEAD.
(iii) Loans above Rs 50 lakh
In highly deserving cases , FGM shall have the discretion to examine each
proposed case on merits , to cover it in CGTMSE.

7.CREDIT RISK The loans under this category are exempted from Risk Rating and should be
RATING treated as BB Rated Borrowers (B1 under revised grades) or borrowers having
scores (Retail/SME/Agri)>52<=58 and pricing will be decided accordingly.

10 SCHEME FOR FINANCING PROFESSIONALLY QUALIFIED SELF

EMPLOYED PROFESSIONALS – “PNB PROFESSIONAL”
1. PURPOSE  To finance for purchase of various equipments as required by the
professionally qualified person for self employment.

 Finance can also be allowed for purchase, construction, addition, alteration,

renovation, furnishing of the work place (including land for workplace).
However, it must be ensured that land is not used for any other commercial
purpose.
To meet working capital requirements for day to day operations. Example:
salaries, purchase of books etc.
2.ELIGIBILITY This scheme is to assist self-employed professional persons, firms,
associations and joint ventures of such professional persons having
professional degree/diploma/certification as under:
 Engineering and Technical including software professionals
 Business Management
 Media & Journalism
 Law
 Foreign Language
 Computer
 Animation
 Designing
 Fine arts
 Certified Tax Return Preparers (TRPs)
 CA/ICWA/CS
 Etc.
(This list is only indicative and not exhaustive)
a) A professionally qualified person* (other than medical professionals
and traders) who is desirous of setting up/ enhancing his own practise/
business/ taking up self employment.
*A professionally qualified person is one who has obtained the requisite degree/
 diploma/ certification approved by UGC/ Central or State government/ approved
certifying agency by virtue of which he becomes entitled to practise that
profession.
b) Persons already practising or new entrants in various professions, having
licences issued under Central or State Legislations, will be eligible for loan under
the Scheme.
c) Constitution- Individuals / Partnership / Ltd Liability Partnership / Pvt.
Ltd. Co. / Ltd. Co. / Associations.

3.EXTENT OF Term loan:- Minimum: Rs. 1 lakh Maximum: Need based

FINANCE Over draft:- Minimum: 1 lakh Maximum: 25 lakh
Cash Credit:- Minimum: 1 lakh Maximum: Need Based
4.FACILITY / MARGIN
Term loan /CC/OD Upto 2 lakh : NIL,
Above 2 lakh : 25%
5.REPAYMENT
Overdraft/CC WC facilities shall be sanctioned for a period of one year and shall be reviewed /
renewed annually.
Term Loan Maximum 7 years in equal monthly / quarterly instalments inclusive of a
maximum moratorium period of 6 months. However, a higher moratorium period
of 18 months may be allowed in case of construction of work place. (Where land
is purchased for construction of work place, the construction should start within a
period of 6 months from the date of last disbursement of loan for land and should
be completed within moratorium period).
6 .SECURITY
PRIMARY Hypothecation of equipments / items purchased / equitable mortgage of land and
building of work place in case the loan is for acquiring / constructing the work
place.
COLLATERAL For Accounts covered under CGTMSE
Loans up to Rs. 10 Lakh:
No collateral security to be taken. To be covered on merits under Credit
Guarantee Scheme of CGTMSE.
Loans above Rs. 10 lakh and upto Rs. 100 Lakh, covered under Credit
Guarantee Scheme of CGTMSE:
 No collateral or third party guarantee.
Extent of Collateral
For accounts not covered under CGTMSE, the extent of collateral security will
be as under:-
Loans above Rs. 10 Lakh up to Rs. 20 Lakh
Third Party Guarantee.
Loans above Rs. 20 Lakh
Collateral Security: Equitable mortgage of immovable property equivalent to
100% of loan amount.
No collateral security is required, in case where land and/or building of work
place is financed by us and is mortgaged as primary security and adequately
covers the loan amount (at least to 110% of loan amount).

11. PNB LAGHU UDYAMI CREDIT CARD SCHEME (PNBLUCC SCHEME)

1. PURPOSE To provide simplified loan delivery mechanism to meet the credit requirements
of Small Business units, Retail traders, Artisans, Village industries Micro &
Small Enterprise (Manufacturing and processing), Micro & Small-Services &
Business Enterprises (MSSBEs), Professionals and Self Employed persons, etc.

2.ELIGIBILITY All existing customers of the above categories who are dealing with our bank
& EXTENT OF for the last three years satisfactorily and enjoying working capital limit upto
FINANCE Rs.20 lakh are eligible The conversion to PNBLUCC will be considered in the
next quarter of completion of three years of satisfactory operations of the
account.
For circles having more that 10% NPA under PNBLUCC as on last
preceding financial year end, the limit will continue to be Rs. Rs. 10 lakh)
4. MARGIN For Micro & Small Enterprises (other than Trading):
Cash Credit (Hyp.)

Upto Rs. 2.00 lakh : NIL

Above Rs.2 lakh & upto Rs 5 lakh : 15%
Above Rs.5 lakh : 20%
Cash Credit (Pledge) : 15%
For Micro & Small Enterprises (Trading):
Cash Credit (Hyp. /Pledge) :
 Against Stocks : 30% - 40%, keeping in view,
nature of stocks, Price fluctuation etc.

5.REPAYMENT Yearly review shall be done by the incumbent incharge on the basis of the last
12 months turnover of genuine trade transactions.
6 .SECURITY The existing securities shall be retained while converting the account to
PNBLUCC account.
VALIDITY PNB Laghu Udhyami Credit Card limit sanctioned will be valid for 3 years,
PERIOD OF subject to annual review by the bank.
LIMIT
SPECIAL Submission of stock statements: Account holder would not be required to
FEATURES : submit periodic stock statements or financial statements for renewal of limit.
MONITORING: Stock statements are not to be submitted by the account holders. However,
monitoring of the account operations is to be ensured through quarterly
inspection in case of limit between Rs. 1 lakh and above and through half yearly
inspection in limits of less than Rs. 1 lakh.

12.PNB SME SAHAYOG SCHEME

1. PURPOSE The limit can be utilized for contingencies like additional purchase of raw
materials including packing materials/handling charges for the execution of
bulk orders, taking part in national/international trade exhibitions for
creating market base, payment of consultancy charges, repairs to
machinery, labour payments, etc
2.ELIGIBILITY  The scheme is applicable to existing Micro Small & Medium Enterprises
(MSME) borrowers whose accounts have been classified as standard assets
as on 31 March for the last 3 consecutive years.
 This facility is extended to the existing rated borrowers enjoying credit
limits above Rs.20 lakh.
 For sanctioned limits (Term loan & working capital) of above Rs.20 lakh,
the threshold credit rating should be ‘B1' as on the closing of previous
financial year. Credit risk rating/scoring for any of the earlier years should
not be below 'B3'.
3.EXTENT OF The eligible borrowers will be sanctioned a special credit limit for an amount
FINANCE equal to 20% of the aggregate working capital limits (i.e. fund based and non
fund based separately) sanctioned to the unit, subject to a maximum of Rs.25
lakh.
4.REPAYMENT The borrowers are free to utilize the facility up to 12 times in a year. Each
amount of withdrawal is repayable within maximum period of two months and
 there should be a gap of 15 days between the date of complete repayment of
outstanding and the next withdrawal.
5 .SECURITY Collateral security be obtained as per bank's extant guidelines. The charge on
available security by way of primary/collateral to the existing sanctioned limits
will be extended to cover the clean cash credit limit.

6.RENEWAL The limit will have to be reviewed once in every year along with the other
working capital limits. The limit has to be enhanced /reduced if there is a
revision in the quantum of working capital limits sanctioned.

12. PNB GREEN CREDIT FACILITY

1. PURPOSE In order to meet payment of statutory dues exclusively like income tax, sales
tax, excise duty and other expenses like electricity charges, custom duties,
telephone expenses by MSE units in emergent circumstances,
2.ELIGIBILITY The scheme is applicable to existing Micro & Small Enterprises (MSE)
borrowers of Standard Category, who are banking with us for atleast one
year.
3.EXTENT OF The eligible borrowers will be sanctioned 5% Green Cash Credit facility
FINANCE maximum upto Rs.2.00 lakh of the fund based sanction limit/assessed
permissible bank finance, over & above ad-hoc facility or Special Credit Facility
availed by MSEs units under PNB SME Sahayog.
4.REPAYMENT The debit would be adjusted immediately on availability of balance/DP in
regular cash credit account but not later than 1 month.

13. PNB SCHEME FOR FINANCING TRAVEL AGENTS AND TOUR OPERATORS
1. PURPOSE To finance working capital requirement, purchase of office Equipments /
furnishing, purchase of vehicles for tours and travel & issuance of bank
guarantee.

2.ELIGIBILITY Travel Agents registered with IATA and having satisfactory track record for at
least three years will be eligible for the loan under the scheme.

3.EXTENT OF Need based

FINANCE (Working Capital facility to be assessed on simplified turnover method).
4. Margin Cash Credit (BD) 40%
DD Clean Nil
Term Loan 25%
Bank Guarantee 25%
5.REPAYMENT Working Capital: - Working Capital facility will be reviewed / renewed after
12 months
Term Loan: - Term Loan is repayable in 60 months including maximum
moratorium period of three months in equal Monthly/Quarterly installments
Overdraft: - Repayable in 60 months with reducing DP basis.
6 .SECURITY
PRIMARY Cash Credit: - Hypothecation of Book Debts.
Term Loan/OD: - Hypothecation of equipments /furniture/vehicles/items
purchased out of Bank Loan
COLLATERAL Loans up to Rs. 10 Lakh: Collateral & Third Party Guarantee and eligible
loans are to be covered under Credit Guarantee Scheme of CGTMSE.
Ø Loans above Rs. 10 lacs to Rs. 50 lacs: Wherever collateral security is
available, Incumbents in all the scales are empowered to sanction the loans, as
per extant guidelines. However, if any eligible loan is proposed to be covered
under CGTMSE, prior concurrence be obtained from CIRCLE HEAD.
Ø Loans above Rs. 50 lacs: In highly deserving cases, FGM shall have the
discretion to examine each proposed case on merits, to cover it in CGTMSE. In
case the CGTMSE Coverage is not obtained, the extant guidelines for obtaining
collateral security and/or third party guarantee, shall apply.

14. FINANCING AGAINST PLEDGE OF WAREHOUSE RECEIPTS ISSUED BY

APPROVED COLLATERAL MANAGERS
1.ELIGIBILITY Farmers, Processors, Arthiyas, Exporters/ Importers who are original depositors
covering non–perishable agricultural commodities.
2.EXTENT OF Need based with Min. of Rs.50000/- and maximum of :
FINANCE 1. Rs.50.00 lakh to Individuals, Farmers including SHG/JLG
2. Rs.25.00 crore to Sole Proprietor ship concerns
3. All other categories of borrowers i.e. Partnership, Pvt. Ltd Co., Public Ltd
Co. etc :
Within vested loaning powers of various sanctioning authorities up to the
level of FGM, as per power chart circulated by IRMD LA from time to time.
 4. For all categories of borrowers beyond the
level of FGM loaning power :
Within vested loaning power of sanctioning authority at HO, subject to amount
and exposure ceiling prescribed in Credit Management & Risk Policy of the
Bank.
3.NATURE OF Demand Loan / Cash Credit.
CREDIT
FACILITY
4. Margin 20% to 40% depending upon commodity financed.
5.REPAYMENT Maximum 12 months
6 .SECURITY
PRIMARY Pledge of Warehouse Receipts duly endorsed in bank’s favour issued by
approved collateral manager in respect of goods/stocks stored therein by
Farmers/Traders/ Processors etc.
COLLATERAL Waived on continual basis subject to periodic review of portfolio at Corporate
level.
7.RATE OF BR + 1% Inclusive of Collateral Management charges of 1% (0.75% CM
INTEREST : charges and 0.25% Referral charges, wherever applicable).
(applicable for
advances to
MSME):

15. SCHEME FOR FINANCING PERSONS WITH DISABILITIES (PWDs) - UNDER

100% REFINANCE ARRANGEMENT WITH NATIONAL HANDICAPPED
FINANCE AND DEVELOPMENT CORPORATION (NHFDC)

OBJECTIVE The scheme aims at promoting economic development activities and self
employment ventures for the benefit of persons with disabilities by extending
collateral free loan and upgradation of their entrepreneurial skill leading to self
employment ventures.
1.ELIGIBILITY Any disabled person who fulfils the following criteria shall be eligible for
assistance under the scheme.
Any Indian citizen with 40% or more disability.
Age between 18 and 60 years.
• Annual Income below Rs. 500000/-(Rupees Five lakh only) per
annum for urban areas and Rs. 300000/-(Rupees Three Lakh only)
 per annum for rural areas.
• Relevant Educational/Technical/Vocational qualification/experience
and background.
2.EXTENT OF Income generating activities alongwith quantum of loans, included for financial
FINANCE assistance by way of concessional loans and grants, are as under:-
• For setting up of self employment service units:- Need based, subject
to maximum loan upto Rs. 5.00 Lakh.
• For setting up of self employment
manufacturing/fabrication/production units:- Need based, subject to
maximum loan upto Rs. 25.00 Lakh.
• For purchase of vehicle including auto rickshaw for commercial
hiring Purpose: Need based, subject to maximum loan upto Rs.10.00
Lakh.

3.NATURE OF • Term Loan and

• Working Capital by way of WCTL.
CREDIT
FACILITY
4. Margin Upto Rs. 2.00 Lakh : Nil
Above Rs 2.00 Lakh & upto Rs.5.00 lakh : 15.00%
Above Rs.5.00 lakh & upto Rs. 25.00 lakh : 20.00%
For purchase of vehicle for commercial hiring under micro enterprises
segment:-
85% of the invoice cost of the vehicle inclusive of the cost of chassis,
construction of body thereon and the fare meter as the case may be.Loan will be
allowed for new vehicles only.
5.REPAYMENT For setting up manufacturing/service unit
The term loans/WCTL will be repayable in monthly/quarterly installments
within 3 to 5 years depending upon the project profitability inclusive of the
gestation period of 6 to 12 months.
For purchase of vehicle for commercial hiring under micro enterprises
segment
The loan against auto rickshaw, station wagons or tempos shall be for a
maximum period of 4 years and against taxi cars 5 years repayable by monthly
installments commencing from one month after the date of the loan.
Note: - In case of default/delay in repayment of installment, normal ROI as
applicable from time to time alongwith penal interest will be charged in the
account for the period of the amount delayed/defaulted.
6 .SECURITY Loan sanctioned will be secured by way of primary charge over the assets
financed. No collateral security be obtained from borrower and accounts are to
be covered under credit guarantee scheme of CGTMSE for which Annual
service fee/Guarantee fee(ASF/GF) shall be borne by the borrower itself.

7.RATE OF S.No. Loan Amount Rate of Interest to be charged by

INTEREST Interest NHFDC for refinance
(a) Upto Rs 50,000/- 5% 2%
(b) Above Rs 50,000/- and 6% 3%
(c) upto
AboveRsRs
5 lakh
5 lakh 8% 5%
Note:- A special rebate of 1% on interest is given to women with
disabilities for which refinance will also be available at 1% lower rate to
maintain 3% cushion in ROI for the Banks.

16. PNB NURTURE: SCHEME FOR FINANCING DAY CARE CENTRES/CRECHES

AND RELATED ACTIVITIES EXCLUSIVELY FOR WOMEN ENTREPRENEURS

1.OBJECTIVE To empower and encourage women entrepreneurs to establish Child Day Care
Centres/Crèches and related activities by providing them hassle free financial
assistance at liberal and concessional terms to ensure the easy, timely
and convenient access to undertake the profession.
2. Eligibility Any individual / proprietary concern / partnership firm / association of persons
(AOP) / limited liability partnership (LLP) / etc. exclusively owned / managed
by women. (Registration of Day care/crèches is required, if applicable by State
Government)

Preference will be given to the following categories of women entrepreneurs:

s trained in R-SETIs / Skill
3.Purpose To finance for setting up new unit / enterprise or for expansion /modernization
of existing Unit.

conditioners, etc).
al needs: To finance for purchase of various
entertaining and educational items /equipments / payment of salaries to staff /
etc. as required by the unit.
4.EXTENT OF Upto Rs. 2.00 lakh
FINANCE
5.NATURE OF Term Loan / WC in shape of OD – Need based, subject to maximum of Rs.
CREDIT 2.00
FACILITY lakh
6. Margin Nil
7.REPAYMENT For TL – 3-5 years with maximum moratorium of 3 to 6 months depending on
the Cash flow / project viability report / life of the asset and subsistence need of
the borrower.
– It shall be renewed / reviewed annually as per Bank’s extant
guidelines.
8 .SECURITY Hypothecation of assets created out of Bank finance.
Advances to be covered under Credit Guarantee Scheme of CGTMSE.
E-BANKING
1. PNB Internet Banking Services
2. PNB Mobile Banking Services
3. PNB on Social Media Platforms - Twitter & LinkedIn
4. Immediate Payment Service (IMPS)
5. PNB MobiEase – An Android app for SMS Banking (A single touch solution)
6. PNB ATM Assist - Mobile App to assist the users of ATMs (An Android App)
7. “Sleep Easy” - Facility of Blocking of Internet Banking & Mobile banking
transaction password through SMS
8. PNB E-PPF: Opening of PPF Account by IBS Retail Users through Internet
Banking
9. PNB e-FD: Opening of Fixed Deposit by IBS Retail Users through Internet
Banking
10. PNB online request for opening of Savings Account
11. PNB’s Green Initiatives – Green PIN for Debit Card
12. PNB online loan eligibility assessment (Housing/Car)
13. PNB Rupay Platinum Card – More secure Chip based card
14. PNB Rakshak Platinum Debit Card – For Defence Personnel
15. PNB Suvidha Card – For individual and corporate
16. PNB World Travel Card (Available in US$, British £ & Euro €)
17. PNB Debit Cards – Features & Benefits
18. PNB Doorstep Banking Services
19. PNB Rewardz – A shower of rewards in everyday life
20. PNB Cash Deposit Machine (CDM)
21. PNB Electronic Cheque Deposit Machine (ECDM)
22. PNB Passbook Updation Machine (PUM)
23. PNB e-CMS
24. PNB SMS Alerts
25. PNB Contact Centre
26. Cash Management Services
27. Funds Collection Module/PayFee
28. PNB Fee Portal
29. e-CMS
30. DD Drawing facility
31. Doorstep Banking Services
32. POS (Point Of Sale Terminal)
33. Internet Payment Gateway
1. PNB Internet Banking Services

Visit www.netpnb.com & register online for PNB Retail Internet Banking
Services
Self-Registration for Retail Internet Banking Services

What You Need: Account Number, Debit/ATM Card Number, ATM Pin

 Browse http://www.netpnb.com & Click on Retail User.

 Click on the link “New User” (Bottom Right).
 Enter Account Number & either Date of Birth or PAN Number registered with the
Bank.
 Select Type of facility “View Only” or “View & Transaction Both” & Click on
“Verify”.
 Enter OTP received on registered Mobile Number.
 After verification of OTP, enter Debit Card credentials.
 On successful validation of entered details, you can set passwords.
 After successful registration, your User ID will be displayed on the screen
 You can access Internet Banking instantaneously after registration.

Financial Services Non- Financial Services Value Added Services

Fund Transfer within PNB View Account details - Online Registration/ Password
- Self Transfers - Statement of a/c Reset
- 3rd Party Transfers - Nomination details - Schedule transaction for future
- Transaction History
- PPF Account date.
- Set Recurring transactions e.g.
Inter Bank Fund Transfer Cheque Related Services Automatic credit to RD
- 24 by 7 facility, - Stop payment of cheque account every month.
even on Sundays & - Cheque Status Inquiry - Account wise TDS Details.
Holidays through - Raise Cheque book - Initiating transaction from
IMPS (using IFSC request template.
or MMID) - Aadhar, PMJJBY, PMSBY
- NEFT/RTGS registration.
- Change User ID as per your
Online opening of: Offline Service Requests: convenience.
 FD & RD - Change in Credit Card - Personalized Dash board for
 PPF Account limit overall view of accounts.
Credit Card Related - Redemption of credit - E-Filing of Income Tax
- Credit Card card reward points - E- Interest Certificate
Payment - E- Statement - Register for Mobile Banking
Registration - Debit Card Personalization
Utility Bill Payments - Break FD - Debit Card Hotlisting
Tax Payments - Renew FD - Enhanced security features:
OD for PMJDY Accounts - Apply for various Bank o Set your own Transaction
products limits
o Set restriction of login
time.

PNB Digital Signature Certificate (DSC) based authentication – Retail IBS

 Optional mode of Second Factor of Authentication for login and performing

Financial Transactions.
 An additional security with existing password.
 If password gets compromised, transaction cannot be performed without
Digital Signature Certificate.
 It can be link/delink after logging in IBS Retail.
 Enroll/un-enroll authentication only from branch for security purpose (Online
request but authentication from Branch only).

PNB Internet Banking Services - Corporate

 Instant Registration through any PNB Branch. Get User ID & Password
immediately.
 Up to three levels of authentication for your high-value business transactions.
 User level setting of Transaction rights by Corporate as per his own
convenience at any time.
 Schedule the transactions (Within PNB/NEFT/RTGS) for future date & relax.
 Set recurring transactions (i.e. salary to employees/instalment to RD
accounts)
 Upload excel files facility for bulk (Within PNB/NEFT/RTGS) transactions.
 Facility of Trade Finance (Letter of Credit/Bills/Collections/Bank
Guarantees/Import finance etc.)
 Latest security & authentication features like Digital Certificates and Dynamic
One Time Password.

2. PNB Mobile Banking Services

Self-Registration for Mobile Banking Services

Option 1 Option 2

What You Need: Retail Internet What You Need: Account Number,
Banking Login password & Transaction Debit/ATM Card Number, ATM Pin
Password.
 Browse https://mobile.netpnb.com through
Mobile.
 Log-In to Retail Internet Banking.  Click on “Online User Registration”.
 Go to Personal Settings Other  Read & Accept the Terms & conditions
Settings  Register For Mobile and Click on “Continue”.
Banking.
 Enter Account Number, Mother’s Maiden
 Customer ID will be displayed.
Name & either Date of Birth or PAN
Select the type of facility (View Only
Number registered with the Bank.
or View & Transaction). Click on
 Select Type of facility “View Only” or “View
“Continue”.
& Transaction Both” & Click on “Next”.
 Enter OTP received on registered
 Enter OTP received on registered Mobile
Mobile Number) and Click on
Number.
“Continue”.
 After verification of OTP, enter Debit Card
 Enter Transaction Password of IBS-
credentials.
Retail.
 On successful validation of entered
 Enter Date of Birth and Mother’s
details, you can set passwords.
Maiden Name, Click on “Continue”.
 Create Login Password, Transaction
Password & SMS Password.
 Click on “I Accept the Terms &
Conditions” checkbox & click on
“Complete Registration”.

Message will be displayed for successful registration and you can start using Mobile
Banking facility after downloading the App from https://mobile.netpnb.com or from
respective App Store.

Financial Services Non- Financial Services Value Added Services

Fund Transfer within PNB View Account details - Online Registration &
- Self Transfers - Statement of a/c Password Reset facility
- 3rd Party Transfers - Nomination details for Debit card holders
- Transaction History & retail Internet
Inter Bank Fund Transfer Cheque Related Services Banking users.
- 24 by 7 facility, - Stop payment of
even on Sundays & cheque - User can schedule
Holidays through - Cheque Status Inquiry transaction for future
IMPS (using IFSC - Raise Cheque book date.
or MMID) request
- NEFT
Utility Bill Payments Offline Service Requests - Recurring transactions
Mobile & DTH Recharge - Apply for various Bank e.g. Automatic credit to
products RD account every
month.

PNB Mobile Banking Services (NRI customers on international numbers)

 To register International numbers need to send SMS to 919264092640

 Mobile banking can be used only for Domestic Transfers
 Same mobile number is to be registered for SMS Alerts.
  Online registration & online password reset facility is available for
International Mobile numbers also

Features & Services are as under :

Financial Services Non- Financial Value Added
Fund Transfer within Services
View Account details Services
- Online Registration
PNB - Statement of a/c &
- Self Transfers - Nomination details Password Reset
- 3rd Party Transfers facility for Debit
Inter Bank Fund Transfer - Transaction
Cheque History
Related Services card holders.
- 24 by 7 facility, - Stop payment
of cheque - User can
even on Sundays &
- Cheque Status schedule
Holidays through Inquiry transaction for
IMPS (using IFSC - Raise Cheque future date.
or MMID)
Utility Bill Payments Offline book
Service Requests
request - Recurring
- NEFT - Apply for various transactions
Bank products e.g. Automatic
credit to RD
PNB Mobile Banking Services – In Hindi
account every
month.
 It is now available in Hindi also when accessing through
https://mobile.netpnb.com
 Language option can be selected from Drop Down, placed below Login
password field
 On selecting Hindi from the Drop Down, the subsequent screens shall be
shown in Hindi

3. PNB on Social Media Platforms - Twitter & LinkedIn

 PNB Twitter handle in the name of @Indiapnb & official account at LinkedIn.
 Customer can engage with Bank constructively at Social Media Platforms
 Listen to customers
 Periodical posting of Informative Advertisements / Security tips / Bank’s latest
products & services.
 Invites ideas and suggestions.

4. Immediate Payment Service (IMPS)

 Instant Fund Transfer to other Banks’ account

 Safe & convenient
 24*7 availability
 IMPS facility available through PNB Internet Banking, Mobile Banking, SMS
Banking & at ATMs
 Per Day Limit of IMPS
Channel Per Day Limit
Internet/Mobile Banking Rs. 50,000/-
ATM Rs. 10,000/-
SMS Rs. 5,000/-

5. PNB MobiEase – An Android app for SMS Banking (A single touch solution)

 Let your fingers do the Banking.

  No need to type SMS template.
 Download the app and select text message.start banking
 Other useful links – Mobile Banking, NUUP Banking, Balance on Missed Call
etc.

6. PNB ATM Assist - Mobile App to assist the users of ATMs (An Android App)

 To assist and resolve ATM problems and enhanced customer service

 Search for available ATMs by address, near me (within radius of 5kms)
 Report ATM complaints like :
 ATM not working.
 No cash in ATM
 PNB card not accepted
 Other bank card not accepted
 Others (i.e. Light, Cabin, AC and Guard etc.)
 No money dispensed
 Less money dispensed
 More money dispensed

7. “Sleep Easy” - Facility of Blocking of Internet Banking & Mobile banking

transaction password through SMS

 To disable the transaction password of IBS/MBS by sending SMS to 5607040

or 9264092640 from registered mobile number.

 Get information about disabling of transaction password and process to re-

enable.
 Unblocking through Internet Banking & Mobile Banking Services.
 Unblocking authenticated through OTP on registered mobile number.

8. PNB e-PPF : Opening of PPF Account by IBS Retail Users through Internet
Banking

 Available round the clock.

 Easy and convenient through IBS retail at “My short-cut” <> “PPF Account” <>
“Open a PPF Account”..
 Selection of branch as per choice of customer.
 Generation of Cyber Receipt
 On submitted information account opening available for 7 days.
 AOF available in PDF is to be saved for submission to the branch alongwith
documents for opening of account & for future reference.
 Online Transaction available from 6am to 8pm.
9. PNB e-FD: Opening of Fixed Deposit by IBS Retail Users through Internet
Banking

 Available for scheme Multi Benefit Term Deposit Scheme, Special Term
Deposit Scheme, Ordinary Term Deposit Scheme & PNB Sugam Term
Deposit Scheme.
 Available for all customers having Active Savings/Current Account.
 Customer can request upto a maximum amount of Rs. 10.00 crores.
 E-confirmation of deposit receipt with details like date of deposit, amount,
favouring, period, rate of interest, date of maturity, Maturity value etc
 Preferential rate of interest for Senior Citizen
 Auto renewal facility.
 Issuance of TDS certificate
 Premature closure is also available for e-FD accounts only.

10. PNB online request for opening of Savings Account

 Available at home page of our corporate website (www.pnbindia.in) “Online

opening of Account”
 It is simple and less time consuming.
 Available for Domestice / NRI customers.
 Selection of branch as per choice of customer/user.
 Generation of Temporary Customer Reference Number (TCRN) for record
and future reference.
 System generated SMS and E-mail facility.
 Account will be opened at selected branch on submission of KYC documents.
 Simultaneous issuance of Passbook and Debit Card.

11. PNB’s Green Initiatives – Green PIN for Debit Card

 No need to worry about forgotten debit card PIN

 Green PIN facility available for Active Debit Card holders
 Send SMS “DCPIN Card Number” to 5607040 from registered mobile number

12. PNB online loan eligibility assessment (Housing/Car)

 Link is available on our corporate site www.pnbindia.in

 Facility of preferred branch location
 Simple and easy to feed details like name, mobile no, e-mail, net monthly
salary etc.
 Column of co-borrower/s also available for enhancement of loan eligibility
 SMS with eligible amount on entered mobile number.
 In principle sanction mail to the entered mail ID with eligible amount and
reference no.

13. PNB Rupay Platinum Card – More secure Chip based card

 Personalised Debit Card – Name & photo embossed on card

 Cash withdrawal limit Rs. 50,000/- per day
 POS/E-com combined limit Rs. 1,25,000/- per day
  Reward points for using card at POS & E-com.
 Free meals at Airport Lounge – 2 time Twice per quarter
 Free Personal Accidental Death/Permanent Total Disability insurance worth
Rs. 2.00 lacs.

14. PNB Rakshak Platinum Debit Card – For Defence Personnel

 A non personalised Debit Card for Majors, Captains, Lieutenants, Lieutenants

Colonels, Colonels, Brigadiers and those with higher ranks.
 Free Airport Lounge access as per Mastercard scheme
 Daily cash limit Rs. 50,000/-
 Daily POS/e-commerce transaction limit Rs. 2.00 lac.
 Per Transaction limit Rs. 15,000/- on PNB ATMs & Rs. 10,000/- on other
Bank ATMs
 Accidental Death cover of Rs. 5.00 lac available on Active Debit Cards.

15. PNB Suvidha Card – For individual and corporate

 Individual for personal use and corporate for making payments to employees.
 Minimum Rs. 500/- & Maximum Rs. 50,000/-, zero balance in case of
corporate.
 Validity period of 6-36 months
 Reloaded by purchaser free of charge.
 It is accepted at all POS (merchant establishment Master/Maestro logo), over
internet for e-com transactions, utility bill payments.
 Daily cash limit at ATM/POS/e-commerce is Rs. 25000/-
 Facility like balance enquiry, mini statement, cash withdrawal, fund transfer,
PIN change available at PNB’s ATMs.
 At other Banks ATMs Balance enquiry and cash withdrawal.

16. PNB World Travel Card (Available in US$, British £ & Euro €)

 Apply for PNB World Travel Card and enjoy hassle free foreign trip
 No need to carry travellers cheque or foreign currency
 No need to look for Money changers
 Card can be reloaded any number of times within overall entitlement
 Online facility to check balance, spending etc.
 The unspent balance can be surrendered.
 In case of loss of card, it can be immediately deactivated.
 In unlikely event of loss & subsequent misuse of card, bank insuring upto US$
5000
17. PNB Debit Cards – Features & Benefits

 PNB cards are issued free of

cost (1st year)
 Annual fee is recovered from
the account automatically
 All transactions on PNB ATMs
are free.
 In general savings bank
accounts 3 transactions in six metro
cities and in other cities 5 transactions
are free of charges at other Bank’s
ATMs (in India) subject to any changes
made by RBI/Bank from time to time.
 In small/no frill/basic savings
bank accounts 5 transactions in six
metro cities and in other cities 5
transactions are free of charges at
other Bank’s ATMs (in India) subject to
any changes made by RBI/Bank from
time to time.
 Financial transactions at other Bank’s ATMs over the prescribed limit will
attract charges of Rs. 20/- per transaction and Rs. 9/- for every non-financial
transaction.
 For International Use maximum limit for Cash withdrawal, POS & E-com
transaction is Rs. 25,000/- as per RBI guidelines.

The charges for International transactions at ATMs are:

Cash Withdrawal - Rs. 150/- per transaction
Balance Enquiry - Rs. 15/- per transaction.

The charges for International ATM transactions in Nepal under Everest

Bank Ltd. Sharing arrangement are as follows:
Cash Withdrawal - Rs. 50/- per transaction
Balance Enquiry - Rs. 15/- per transaction

The charges for International ATM transactions in Bhutan under Druk

PNB Ltd. (DPL) Sharing arrangement are as follows:
Cash Withdrawal - Rs. 6/- per transaction
Balance Enquiry - Nil

 “PNB Compensation Scheme In Case of Accidental Death of Active PNB

ATM/Debit Card Holders” upto 31/03/2016. Details are as under :
  Cards are of two types, Personalised and Non-Personalised.
 Facility of Cash withdrawal, Fund Transfer through ATMs, E-com/POS
transactions.
 Reward points.

PNB Debit Card – HOTLISTING of Debit Card on real time through Retail IBS

 Click on Personal Settings  ATM/Debit Card Hotlisting.

 Select Account Number from drop down list to which the card required to be
hotlisted is attached.
 Click on “Continue”.
 Cards attached to the selected account will be displayed.
 Select appropriate card number. (In case, card number is not displayed,
user can also enter card number manually in the space provided against
label “Card Number”).
 Enter IBS Transaction Password Click on “Submit”.
 Confirmation message of card being successf ully hotlisted will appear
immediately.

Hotlisting of Debit card can also be done through following channels :

 Through call at call centre No’s 1800 180 2222 / 1800 103 2222 (Toll Free) /
0120-2490000 (Paid Number).
 Through SMS from registered mobile number (SMS as HOT <card
number> to 5607040).
 Through branches.

18. PNB Doorstep Banking Services

 Pickup cash from doorstep of customer

 Insured, safe and secure
 Direct cash deposit at branches having chest.
19. PNB Rewardz – A shower of rewards in everyday life

 Every PNB debit card holder is eligible for reward points for POS and E-com
transactions
 1 reward point on every spent of Rs. 100/- on POS & E-com
 Each reward point is equivalent to Rs. 0.25
 Redemption of points is easy
 Redeem options across the following categories (Minimum 50 reward points)
on www.pnbrewardz.com :
 Movie Tickets
 Merchandise
 Mobile and DTH Recharge
 Bus and Air Tickets Booking
 Hotel Booking
 Charity
 Gift Vouchers
 Visit www.pnbrewardz.com to register
 Download PNB Rewardz App from Google Playstore (Android)

20. PNB Cash Deposit Machine (CDM)

 24*7 availability
 Safe, secure & convenient
 Instant credit in beneficiary’s account
 No need to fill pay-in-slip
 Credit through CDM is allowed for CA/SF/CC/OD/RD & Loan Accounts
 Denomination accepted by CDM is Rs. 1000/-, Rs.500/- & Rs.100/-
 Maximum Amount per transaction is Rs. 30,000/-
 Maximum currency notes per transaction is 40.

21. PNB Electronic Cheque Deposit Machine (ECDM)

 Safe, secure & convenient.

 No need to fill pay-in-slip
 Cheque for Transfer or clearing
 System generated receipt with image of cheque deposited.

22. PNB Passbook Updation Machine (PUM)

 No need to go to branch for updation of passbook.

 Easy and convenient.
 Passbook updated irrespective of branch where account is being maintained
by the customer.
 No charges.

23. PNB e-CMS

 MIS for transaction received through RTGS/NEFT.

 Details provided includes such as Remitter’s name/URT, sender IFSC etc.
  Hassle free reconciliation and faster turn around time at customer end.
 Alerts via e-mail (hourly or as per customer need)

24. PNB SMS Alerts

 Customer can register mandatory or/and non-mandatory alerts.

 Charges applicable for non-mandatory alerts only.
 Charges Rs. 15/-+Service Tax as applicable.

Mandatory Alerts Non-Mandatory Alerts

 Alerts generated for all  Alerts for transactions routed
transactions performed through Branches i.e. Cash
through Alternate Delivery Deposit, Clearing Cheques,
Channel Transactions i.e. Transfer Cheques etc (Sent for
ATMs, Mobile Banking, Transactions above Rs.5000/-)
Internet Banking, POS.  Alerts for FD maturing, Locker
 All type of One Time Rent, Standing Instructions etc.
Passwords (OTPs)

25. PNB Contact Centre

Features :

 Dial 1800 180 2222 or 1800 103 2222 (Toll Free) or 0120 2490000 (Tolled
number) to connect our Contact Centres
 Working 24x7x 365 days.
 Handling multi-lingual calls viz. Tamil / Telugu / Kannada / Malyalam /
Punjabi.
 Account balance services through missed call on customer's registered
mobile number.

Self-Services on IVRS (Interactive Voice Response System)

 Balance Enquiry
 Hot listing of Debit/ATM Cards.
 Mini Statement (Last 5 Transactions)
 ATM PIN Change
 Stop Payment of Cheques.
 Registration of Mobile Number for Debit Card Loyalty Program.
 ATM Transaction Limit Enquiry/Limit Update.
 POS/Online Transaction Limit Enquiry/Limit Update.
 Enquiry for status of International Card Usage.
 Activation / De-activation of International Card Usage.
 Setting/re-setting of preferred language (Hindi/English).
 Enables customers to perform self-service by ATM PIN based authentication.
Services through Customer Service Associates (CSAs)

 Balance Enquiry & Account Related information.

 Lodging of complaints for non-disbursement of cash through ATM, POSP,
IMPS & Bill payment failure.
 Hot listing/Blocking of ATM card or other Card Related Services.
 Resetting of 3D secure password.
 Services related to Internet Banking or Mobile Banking/Request for issuance
of IBS password.
 Query on Loan Products or Deposit Schemes.
 Lodging of complaints/requests.
 Banking product information.

Acknowledgement through SMS after lodgement of complaint by customers:

 SMS to customer containing Docket no for future reference.

 SMS content for different scenario is as under :

S.No. Scenarios SMS contents

1 Complaints regarding Non Dear Customer, complaint
Disbursement of Cash through registered successfully with SR no.
ATM, POSP & IMPS or any A123456789 for amt of Rs. xxxx.xx
other complaints for financial Quote SR no. for future reference.
transactions
2 For other type of Complaints Dear Customer, complaint
registered successfully with SR No.
A123456789. Quote SR no. for future
reference.
2 Request for Hot Listing of Debit Dear Customer, Your debit card xxxx
Card xxx xxxx 1234 hotlisted successfully
with SR no. A123456789. Quote SR
no. for future reference.

3 For other type of Requests Dear Customer, request registered

with SR no. A123456789 Quote SR
no. for future reference.

4 For Queries on Bank’s Product Dear Customer, Thanks for

showing interest in our product.
Your reference no is: 0000649948.
We will contact you shortly.
26. Cash Management Services

Bank offers various variants of CMS to its corporate customers for collection of
cash/instruments at different PNB Branches. CMS is basically designed to meet
corporate customer’s requirements of customized & enriched MIS reports. It is
particularly relevant for corporate customers having vast dealership/branch network
spread across country from where they receive regular collections.

The consolidated funds are pooled to designated account(s) of the clients, who may
view/monitor its accounts, generate reports and pass instructions to the Bank by
accessing the services over the internet (www.onlinepnb.in). (Detailed Circular
DBD 46/2012). Different variants of CMS are as under-

I. Local Cheques/ Cash/ PDC management under CMS

Under the facility bulk cheques, cash and PDCs are handled. It is a value-
added service, provided to our corporate customers who want to avail
collection at multiple locations at PAN India basis. This product is designed to
facilitate corporate customers in their effective fund management by meeting
their requirements of customized and multidimensional MIS reports along with
single consolidated credit for multiple transactions and option of credit on
arrangement basis.

II. Auto Debit Mandate

This facility may be extended to all corporate customers/organizations/NBFCs
having collection/instalment/premium on recurring basis and whose clients/
vendors/suppliers are having account with PNB. ADM, not only facilitate the
clients with enriched MIS and same day credit but also reduce dependence
on physical cheques/instruments.

III. Cheque Printing Facility

Bulk Cheque printing is offered to corporate and government entities who are
issuing large number of cheques on regular basis for paying their dividends,
interests, subsidies etc. This facilitates the clients in avoiding the frauds as
well as error free cheque preparation. As an additional feature these cheques
may have “cover note advice” along with “facsimile signatures” of the
signatories.
Other Fee/fund collection products are as under-

27. Funds Collection Module/PayFee

Product customized in Finacle for collection of fee/funds from students/dealers of
educational institutes/ organizations at all PNB branches. The remitters may deposit
fee along with Fee Challan customized as per institute‘s requirement across all PNB
branches. Break-up of total fee paid, under various sub-heads, may also be provided
in the form of customized MIS at designated mail-id of Institute, which can also be
directly uploaded to institute’s accounting system. Another salient feature of this
product is that institute’s payee database may be maintained for validation at
branches and to maintain data accuracy. (Detailed Circular DBD 54/2013)
28. PNB Fee Portal

PNB Fee Portal has been developed for on-line collection of various fees/dues from
students/parents of the registered Institutes only by using their PNB Internet Banking
Services (IBS) account. The institutes, which do not own its website, may opt for this
product. Students will visit www.mypnb.in/payfee, select his institute, fill in requisite
details and execute payments. The facility of automated MIS is available which is
being sent at designated mail- id of the Institute on a predefined interval. (Detailed
Circular DBD 31/2011)

29. e-CMS
With the increasing usage of NEFT/RTGS transactions for collection of receivable by
corporate, this product has been designed to provide detailed & customized MIS
reports for collections made through NEFT/RTGS. Under the facility each and every
dealer/remitter is assigned a unique virtual account to identify payments initiated by
sender from any bank. Real-time email alerts and uploadable MIS reports are sent
as per requirement of the corporate. (Detailed Circular DBD 17/2016)

30. DD Drawing facility

Under the facility PNB enter into arrangement with other banks wherein they can
draw drafts payable at our branches across the country. The controlling branch
opens 11 digit DD payable accounts. It is on pre-funding basis where Funds are
transferred in DD payable a/c before start of business. Presently we are having
almost 10 private/foreign banks under the arrangement. The bank is benefitted with
the float amount of issued cheques. (Detailed Circular DBD 28/2010)

31. Doorstep Banking Services

Bank offers Doorstep Banking Services to its customers (Individual/Corporate) for
pick up of cash from their premises/offices where proper KYC procedures have been
followed. Customers have to just fill in the enrolment form and execute an agreement
with its branch to avail the facility. (Detailed Circular DBD 45/2013)

The cash is picked-up within normal business hours of the Bank. Complimentary
pickup of Cheques/instruments is allowed, alongwith cash pick-up.
Variants
Customer may opt any of the following options
 On call pick up –Bank’s representative visits customer’s residence/office on
his request , which may be lodged through telephone/fax.
 Beat pick up–Bank’s representative visits customer’s residence/ office daily
for pick- up of Cash.
 Free of cost option – Customers who agree to keep desired float balance in
their SF/CA account are waived off all charges for cash pick-up.

Benefits
 No need to visit branch for depositing cash
 Secured and insured
 Timely pick up of cash
 Low service charges
32. POS (POINT OF SALE TERMINAL)
Merchant Acquiring refers to the activity of enabling merchants to accept payment
through card products such as Debit Card, Credit Card, Prepaid Cards, etc. through
the use of:
a) EDC/POS –Electronic Data Capture/Point of Sale Terminals
b) Internet Payment Gateway (IPG)

TYPES OF POS TERMINALS

1. Physical Point of sale terminals (PSTN, CDMA, GPRS, IP)

 PSTN-Public Switch telephone network :
 CDMA-Code division multiple access
 GPRS-General Packet Radio Service :
 IP-Internet protocol
2. PC based POS terminals
3. IVRS based POS terminals
4. Mobile POS terminals

BENEFITS TO MERCHANTS
 Wide choice of PoS terminals, GPRS, IP, Cash registers etc.:- The machine
gives a
wide choice of channels for the merchant. It has also a facility of generating the
cash
register.
 High speed and accuracy in completing any card transaction:-The whole
transaction
is completed in 2-3 seconds.
 Widespread card acceptance:-All types of cards credit /debit /prepaid are
accepted.
 Prompt payment:- Merchant’s a/c is credited the very next working day of the
transaction.
 Information of credit through SMS:-The information of credit will be provided
through
SMS.
 Dedicated helpdesk support:-It is available for 24x7x365.
 Voice authorisation services:-The facility is provided to the merchant through a
special number provided to him for completing high value transactions.
 Safe and secure: - All the processes are done after going through all the checks
established by the system.

USP OF PRODUCT
 Wide choice of PoS terminals
 High speed and accuracy in completing card transactions
 Acceptance of any Visa/MasterCard (Debit/Credit/prepaid)/RuPay Card.
 Prompt settlement of card transactions in Merchant Accounts
 Pan India Network of support centres
 Safe and secure extensive risk management system to prevent fraud and protect
your Business.
 Quick installation of PoS terminals after submission of documents
 Instant Installation of PoS terminal under
 Most competitive Merchant discount rates
 Green Channel

“Green Channel”
 In order to fast track the process for merchants having relationship with PNB, a new
channel called ‘Green Channel Process’ has been implemented whereby Point of Sale
(PoS) shall be provided to the Merchant Establishments on fast track basis, by
collecting minimum documentation.
 Under this process, PoS terminals are being installed within 4-5 days of submission of
documents by the merchant/branch at select centres.

Scheme for Advance against Future Card Receivables

 The Scheme involves allowing Term Loan against Future ‘Card receivables’ to
Merchant Establishment (ME) who are functioning / operating / carrying out their
retail business activity as a proprietorship concern, a registered Partnership firm
or a Company registered under the Indian Companies Act or a Society registered
under Societies Registration Act.

 Loan amount – Minimum Rs.2.00 lacs (Term Loan), Maximum Rs.50.00 lacs in case of
Sole Proprietorship/Society and Rs.200.00 lacs in case of partnership firm/Company with
other eligibility terms & conditions given in CCD-MAB Circular No.1/2012 dated
03.03.2012.

33. INTERNET PAYMENT GATEWAY

 An E-commerce application that authorizes payment for e-businesses.
 Facilitates the transformation of information between the merchant website and
acquiring Bank.
 Payment Gateway forwards the transaction information to the processor used by
the
Merchant’s Acquiring Bank.

USP OF PRODUCT
 Secured transactions
 All Master/Visa Cards can be used on the payment gateway
 Detailed MIS to merchant on Daily basis
 Console user ID, which helps in tracking the transaction immediately
 Hassle free transactions
 99.99% uptime
 Easy integration
 Low setup fee/ free for Government Organization
 Low AMC/ Due Diligence charges
 Provide IPG to Ltd. Companies, Partnership firms, Accounts of Trusts, Societies,
 Associations and Foundations, Sole-Proprietor ship, PSU/Govt. Bodies
E. GOVERNMENT BANKING DIVISION
1. Pension Payment
2. Kisan Vikas Patras
3. Public Provident Fund Scheme (PPF)
4. E-PPF through Internet Banking System
5. Senior Citizens Savings Scheme
6. Sukanya Samriddhi Khata
7. Collection of Direct Taxes – On-Line Tax Accounting System (OLTAS)
8. Collection of Indirect Taxes – Electronic Accounting System in Excise and Service
Tax (EASIEST)
9. Collection of MCA21 (Ministry of Corporate Affairs) fees
10. E-Payment of VAT
11. E-Stamping of documents (Payment of Non Judicial stamp duty)
12. Payment of E-Freight (Railways)
1. Pension Payment

Strategy for • Circles to canvass Pension account in proactive

Marketing mode i.e. opening of at least 2 Pension accounts per
month, per branch on an average.

• Marketing team at Circles / CPPCs should visits

Record Offices of Defence, Zonal/Divisional Railways,
Telecom Circles, Postal Circles, PSUs & other Govt.
Offices for fetching fresh business of retirees.

• Circles/ CPPCs should also contact State Treasuries

to tap new Business.

• CHs to empower CPPCs with trained staff & resolve

infrastructure issues raised by CPPCs so that smooth
functioning be ensured at CPPCs

• Continuous Aadhaar seeding & updation of contact

details of Pensioner to offer better services and
proper communication.

Recent Initiatives  First bank to receive e-PPOs. Automated online flow

taken by Bank to of data from Pension Sanctioning Authorities to the
bank without any manual intervention. No delay in
improve pension
delivery of PPO, loss of PPO or error in data uploading
delivery: at bank level.
 First bank to develop fully automated system of
accepting digital LC from pensioner. Pensioner can
submit his LC from the comfort of home.

 Pensioner in PNB can submit his LC at any branch of

the bank.

 Prompt updation of DA and special processings for

paying DA Arrears;

 Special Processing by 8-10th of every month to release

commutation and gratuity amount;

 SMS reminders to pensioners in the last week of

October requesting pensioners to submit LC in
November;

 Special processing on 1st working day of December for

those pensioners who have submitted LC during 24th
to 30th November;

 Automated release of old age benefits to the

pensioner on reaching defined age;

 Automated restoration of commutation after 15 years;

 Providing details of pension in the Pass book

 Attractive benefits in Pension SB accounts;

 Our bank is going to set up CPPC at PCDA

Allahabad with dedicated e-mail ID for addressing
grievances of Defence pensioners. Only two banks SBI
and PNB will be having CPPC in the campus of PCDA,
Allahabad;

 Only bank to have set up CPPC cell at Navy pension

Office, Mumbai where all the initial formalities of the
retiring sailors are completed on the spot;

 Our bank has set up Veterans Facilitation Centre cum

e-lobby at the office of Directorate of Indian Army
Veterans (DIAV), Delhi Cantt, to properly attend
grievances of army pensioners. Similarly helpdesk at
Navy Pnsion Office at Mumbai & near ACAS, IAF at
Delhi are also set up.

 We have created a separate e-mail ID

armypension@pnb.co.in for army,
airforcepension@pnb.co.in for Airforce and
 navypension@pnb.co.in for Navy pensioners
respectively.

 All guidelines / circulars / pension rules placed at ftp

site 10.192.36.52 for access to branches

2. KISAN VIKAS PATRAS

S Particular Features
No
1 Denomination of The Kisan Vikas Patra shall be issued in denominations
Certificates. of Rs. 1,000/-, Rs. 5,000/-, Rs.10,000/- and Rs. 50,000/-

2 Limit Any limit of Certificates of the denomination may be

purchased.
3 Type of Certificates Individual and Joint
4 Issue of KVPs Either Cash/Cheque
5 Transfer from Post Allowed
Office to Bank and vice-
versa
6 Transfer of Certificate Allowed.
from one person to
another
7 Pledging of Certificates Transfer of any Certificate as security is allowed to
–

(a) the President of India or Governor of a State in

his official capacity;

(b) the Reserve Bank of India or a Scheduled Bank

or a Cooperative Society including a Cooperative
Bank;

(c) a Corporation or a Government company;

(d) a local authority; and

(e) a Housing Finance Company approved by the

National Housing Bank and notified by the Central
Government.

(f) The transfer of a Certificate purchased on

behalf of a minor shall not be permitted
8 Nomination Allowed.

9 Post maturity interest It is calculated at the rate applicable from time to

time to Post Office Savings Accounts of the type of
single or joint account and any part of the period
which is less than one month shall be ignored.

10 Replacement of lost or Bank Officer of the branch of issue is satisfied as to

destroyed Certificate
the loss, theft, destruction, mutilation or defacement
of the Certificate, he shall issue a duplicate
Certificate on the applicant’s furnishing an
indemnity bond in the form laid down by with two
sureties or with a bank’s guarantee.

11 Encashment on The maturity period of a Certificate of any

maturity
denomination shall be eight years and four months
commencing from the date of issue of the
Certificate.

(2) The amount inclusive of interest, payable on

encashment of a Certificate at any time after the
expiry of its maturity period shall be Rs. 2000 for
denomination of Rs.1000 and at proportionate rate
for any other denomination.

12 Premature encashment (a) on the death of the holder or any of the holders
in the case of a joint holder;

(b) on forfeiture by a pledge being a Gazetted

Government officer;

(c) when ordered by a court of law.

(d) after expiry of two years and six months from

the date of issue of Certificate.
3. Public Provident Fund Scheme (PPF)

Public Provident Fund Scheme was introduced by Government of India on

01.07.1968 and it provides the depositor the twin benefits of attractive return and tax
benefit. The Scheme is operational in select 693 branches of PNB. The salient
features of the Scheme are as under:-

Eligibility:

 Individual or individual as guardian of a minor can open the account. (can not
be opened in Joint names).
 HUF are not eligible.
 Non Resident Indians are not eligible to open the account.
 Only one account can be opened by an individual in one name.

Deposit:

Every individual desirous of subscribing to Fund under the Scheme for the first time
either on his own or on behalf of a minor of whom he is the guardian shall apply to
the Accounts Office in Form A form, together with the amount of initial subscription
which shall be minimum of Rs.100/-.

Minimum remittance of Rs.500/- and maximum of Rs.1,50,000/- in multiples of Rs.5/-

can be made in lumpsum or in 12 installments per year.

(The subscription limits stands enhanced to Rs. 1,50,000/ per year w.e.f.
23.08.2014)

Duration:

The account is of 15 years duration and the account can be continued for one or
more blocks of 5 years without loss of interest on written request within 1 year from
the date of maturity.

Interest:

Interest at the rate of 8.70% p.a. w.e.f 01.04.2013 is credited to the account on 31st
March of every year on the minimum balance between 5th day and end of the
month. The rate of interest is notified by Ministry of Finance every year.

Loans and Withdrawals:

The depositor is eligible for a loan. The first loan can be taken in the third financial
year from the financial year in which the account was opened up to 25% of the
amount at the credit at the end of first financial year. Loan is repayable in 36 months.
W.e.f 01.12.2011, Interest is payable on the loan at 2% per annum of the principal.
The repayment of loan may be made either in one lump sum or in two or more
monthly installments within the prescribed period of thirty six months. The repayment
is credited to the subscriber’s account. After the principal of the loan is fully repaid,
the subscriber shall pay interest thereon in not more than two monthly installments at
the rate of two per cent per annum of the principal. If the loan is not repaid within the
prescribed period of thirty six months, interest on the amount of loan outstanding
shall be charged at six per cent per annum instead of at two per cent per annum.

Withdrawal is allowed every year from the end of the 5th year. The amount is limited
to 50% of the balance at credit, at the end of 4th year immediately preceding the
year in which the amount is withdrawn or at the end of the preceding year whichever
is lower less the amount of loan if any drawn by him which remains unpaid.

If the account is continued after maturity, a partial withdrawal up to 60% of the

balance of credit at the commencement of the extended period is permitted.

Transfer of a/c:

The account is transferable to and from permitted branches of Nationalised or

Private sector Banks or Post Offices on the request of PPF A/c Holder.

Premature Closure of PPF A/c

Premature closure of the account after completion of 5 years from the end of the
year in which the account was opened could be considered by the Ministry of
Finance on genuine grounds of hardship.

Tax Benefits:

The subscriptions to the account qualify for deduction under Section 80 C of IT Act.
The interest credited to the account is totally exempt from Income Tax. The amount
standing to the credit of the account is fully exempted from Wealth Tax.

Revival:

Discontinued account can be revived on payment of Rs.50/- per year along with
arrears of subscription of Rs.500/- p.a.

Nomination:

Nomination facility is available

Intersol Deposit and Standing Instruction Facility

Available in all branches.

4. E-PPF through Internet Banking System

The detail of the Scheme is as under:-

Customer can avail this facility round the clock by Log-in to Internet Banking System
using his ID and Password following the simple steps mentioned hereunder :
(i) For IBS Users using their IBS ID & Password

Step I

(i) Log-in to IBS using ID and Password.

(ii) Go to option “My short-cut” <> “PPF Account” <> “Open a PPF Account”.
(iii) Fill up all the PPF Account Opening details available on screen and select a
name of authorized branch from drop down menu where the PPF Account shall
be opened and maintained.
(iv) Submit.

Step II

(i) After “Submit”, Request Confirmation screen shall appear.

(ii) Enter Transaction Password and “Submit”.

Step III

(i) After entering Transaction Password and Submit button, “Cyber Receipt” with
GBM Reference number shall be generated on IBS screen. Information
submitted by IBS user for opening PPF Account shall be available for 7 days
only.
(ii) Download PDF file and take print-out of Account Opening Form (AOF) having
GBM Reference on it.
(iii) Paste the Photo on Account Opening Form and enclose the copy KYC
documents e.g., Copy of PAN No, Copy of Ration Card, Copy of Voter ID etc.
(iv) Hand-over the Account Opening Form along with KYC documents to the
authorised PPF branch selected by him from drop down menu where the PPF
Account shall be opened.

(ii) For GBM-PPF Users at PPF Authorised Branch

Step I
(i) Branch User to Log-in to GBM <> PPF.
(ii) Select sub-option “Inet Account Opening” i.e. last option available under main
option “Masters”.

Step II

(i) Click on “Add” button and select the “GBM reference No.” available on Account
Opening Form, by using TORCH icon and Submit.

Step III

(i) After submit, Account Opening screen will appear with details of PPF Account
Holder. The fields can be edited before verification.

Step IV

(i) Check PPF Account Opening details ensuring that all the details are filled in
GBM-PPF procedurally and Submit.
Step V

(i) After Submit, PPF Account Number will be generated.

Step VI : Verification Process

(i) After generation of PPF Account Number, branch user has to verify the record of
PPF Account Number by selecting GBM <> PPF <> Inet Account opening <>
Verify.
(ii) Select the GBM Reference No. by click on Torch Icon available on GBM-PPF
screen and press Submit button.
(iii) PPF Account successfully verified will appear on GBM-PPF screen.
(iv) Make transaction in the PPF Account with the amount tendered by customer.
(v) PPF Account No. shall be linked immediately with IBS ID & Password of
customer for making transactions in the account on-line.

3. After making transaction in PPF Account, either PPF Pass Book or Statement
of Account shall be given to customer immediately. Further transactions in PPF
Account can be made by IBS user on-line using his IBS ID and Password in terms of
our Cir No. 72/2015. The customer can make 12 transactions (on-line and off-
line, taken together) in his PPF Account during Financial Year.

5. Senior Citizens Savings Scheme

Retirement brings with itself several complications and doubts, but there are savings
products that are safe and ensure guaranteed retirement income. The Senior Citizen
Savings Scheme (SCSS), launched in 2004 is a deposit scheme introduced by the
government of India to provide guaranteed returns to senior citizens through a safe
investment. This scheme ensures a regular income stream for senior citizens in
retirement.

Eligibility

You need to be a retired Resident Indian to open an account

Entry Age

 60 years
 55 years for those who have retired on superannuation or under a voluntary or
special voluntary scheme
 The retired personnel of Defence Services (excluding Civilian Defence
Employees) shall be eligible to invest irrespective of the age limits subject to
the fulfilment of specified conditions

Investments

 Minimum: Rs 1,000
 Maximum Rs 15 lakh
 Deposits have to be in multiples of Rs 1,000
Interest

 9.30 per cent per annum compounded quarterly.

 Interest shall be payable from the date of deposit to 31st March/30th
June/30th September/31stDecember on 1st working day of
April/July/October/January as the case may be, in the first instance and
thereafter, interest shall be payable on 1st working day of
April/July/October/January.

Tenure

5 years which can be extended by 3 more years

Account holding categories

 Individual
 Joint with spouse

Nomination

Facility is available

Interest Guarantees

The interest rates on this scheme will be notified by Ministry of Finance / Reserve
Bank of India before April 1 of that year and is aligned with G-Sec rates of similar
maturity. Currently the interest rate in the SCSS deposit is 9.30 per cent per annum
compounded quarterly (w.e.f. April 1, 2013).

Liquidity

The SCSS is liquid, despite the 5-year stipulated lock-in.

The liquidity is offered in the form of withdrawals subject to conditions and penalties.

Exit Option

 Premature closing of the account is permitted with penalty.

 The facility of pledging the deposit in the SCSS account to obtain loans is not
permitted as it defeats the purpose of regular income.
 Premature withdrawal or closure of the SCSS account is permitted after
completion of one year from the date of opening the account after deducting a
penalty for early withdrawal or closure that varies from 1-1.5 per cent
depending on the completed tenure of the account.
 If the account is closed after the first year and before the end of the second
year, an amount equal to 1.5 per cent of the deposit shall be deducted as
penalty.
 If the account is closed on or after the second year, an amount equal to 1
percent of the deposit shall be deducted.
Tax Implications

Interest earned on the deposit is fully taxable and tax is deducted at source (TDS) as
per applicable Income Tax Rules. However, if the income is not taxable, one has to
provide form 15H or 15G so that no tax is deducted at source.

How to Open an Account

Open a savings bank account along with SCSS Account and you will need the
following documents to be tendered at Branch Counter : -

 An account opening form which the branch will provide.

 Two passport size photographs.
 Address and identity proof such as copy of the passport, PAN (permanent
account number) card or declaration in form No 60 or 61 as per the Income
Tax Act 1961, driving license, voter’s identity card or ration card.
 Carry original identity proof for verification at the time of account opening.

6. Sukanya Samriddhi Khata

 One Girl One Account
 Can be opened for Maximum two girls
 Account opening for third Girl – in the event of birth of twin girls as second
birth or if the first birth itself results into three girl children
 The account may be opened by the natural or legal guardian in the name of a
girl child from the birth of the girl child till she attains the age of ten years.
 No Fixed Interest Rate Government will declare on yearly basis. For the
Financial Year 2015-16 Govt. has declared Interest Rate of 9.20%.
 Interest After Maturity of account- If account is not closed after maturity,
balance will continue to earn interest as specified for the scheme from time to
time.
 Maximum and Minimum Deposit
 Minimum – Rs, 1000/- Per Year
 Maximum- Rs. 1,50,000/- Per Year
 Term Period – Deposits can be made till completion of fourteen years.
 The maturity of the account is 21 years or if the girl gets married before
completion of such 21 years.
 No Deposit for the period from 15th to 21st Year of account.
 Pre-Mature Withdrawal - withdrawal up to fifty per cent of the balance at
the credit, at the end of preceding financial year when the account holder girl
child attains the age of eighteen years.
 Facility to closure on maturity or before maturity due to Marriage of
Account Holder.
7. Collection of Direct Taxes – ON-LINE TAX ACCOUNTING SYSTEM (OLTAS)

Features of the product Acceptance of taxes at the receiving branches:

in brief A taxpayer can pay direct taxes at any authorized
branch of the bank either in cash, direct debit to
account or by a cheque/draft drawn on the same bank
or another bank/branch at the same centre where the
payment is made. The payment of tax by outstation
cheques/drafts can also be made at any authorized
branch, or through an electronic means of remittance to
the authorized bank/branch. Funds/amount deposited
through cheques/Drafts shall be credited to
Governments’ account after realization of the
instrument.
Type of Direct Taxes Income Tax, Corporate Tax, Gift Tax, Wealth Tax, TDS on
sale of property, {BCTT & Securities Transaction Tax (since
abolished)}
Terms & Conditions For every payment there should be a challan in the
prescribed format. The challan format is a single copy
challan with the main challan at the top and the
taxpayer's counterfoil at the bottom of the challan.
Documents required 1. Main portion of the challan and the taxpayer's
counterfoil form be filled in properly and the amount
and major head of account to which the amount is to
be accounted/credited be correctly recorded therein.
2. Details of the Permanent Account Number (PAN) or
Tax Deduction Account Number (TAN), name and
address of the taxpayer, assessment year and nature
and type of payment are to be properly filled in.
3. The amount should be written correctly both in words
and figures.

Suggested time norms For physical payment of challan: 15-20 minutes.

for activity
For e-payment: On real time basis. Once the customer
account is debited, transaction gets completed at
Government website and tax will be treated as payment
made to Government. Amount paid after 8.00PM, will
be treated for next day payment.
Dos &Do’nts Customer should be careful in filling of the details in
challan forms.
Customer’s obligation 1. U/s 139 A (5) (b) of the Income Tax Act, quoting of
PAN is mandatory. Similarly, u/s 203A of the Act,
quoting of TAN is mandatory.
 2. However, where the taxpayer indicates that he has
already applied for allotment of PAN or TAN but has
not yet been allotted the same, the tax payment
challans may be accepted by the bank provided the
tax payer indicates PAN/TAN application number in
the challan. In such cases it should invariably be
ensured that the full address of the taxpayer has
been mentioned in the challan.

Grievance To be settled within reasonable time

Resolution/compensation

Any other important The facility is available for payment of direct taxes
matter relating to the
through physical challan at authorized branches as well
product
as e-payment. For making e-payment, the customers
should have PNB's Internet Banking User-id &
passwords.

System generated computerized receipt is made

available to the tax payers.
Mandatory payment of Central Board of Direct Taxes vide their notification
Direct Taxes through e-
No.34/2008 dated 13.03.2008 had made payment of
payment mode only
Taxes mandatory through e-system for following
category of tax payers w.e.f. 01.04.2008:
 A Company
 A person (other than a company), to whom
provisions of Section 44AB are applicable.

Acceptance of TDS on The Finance Bill 2013 has proposed that purchaser of
sale of Property
an immovable property (other than rural agricultural
land) worth Rs 50 lakh or more is required to pay
withholding tax at the rate of 1% from the consideration
payable to a resident transferor.

This tax is to be paid by the tax payer through e-

payment mode only.

Alternatively, tax payer is facilitated for making the

required payment at any of our bank branches. For this,
 taxpayer has to furnish the details online and
subsequently visit any of our bank branches.

8. Collection of Indirect Taxes – Electronic Accounting System in Excise and Service

Tax (EASIEST)

Features of the product Acceptance of Indirect taxes at the receiving branches:

in brief A taxpayer can pay indirect taxes at any authorized
branch of the bank either in cash, direct debit to
account or by a cheque/draft drawn on the same
bank or another bank/branch at the same centre
where the payment is made provided the Assistant
Commissioner or the Deputy Commissioner of
Service Tax/ Central Excise, as the case may be,
having jurisdiction, may for reasons to be recorded in
writing, allows the assessee to deposit the Service
Tax/ Central Excise by any mode other than internet
banking, since the payment of Service tax/ Excise
Duty through e-payment mode has been made
mandatory for every assessee w.e.f. 01.10.2014.
The payment of tax by outstation cheques/drafts can
also be made at any authorized branch, or through
an electronic means of remittance to the authorized
bank/branch. Funds/amount deposited through
cheques/Drafts shall be credited to Governments’
account after realization of the instrument.
Terms & Conditions For every payment there should be a challan in the
prescribed format. The challan format is a single
copy challan with the main challan at the top and the
taxpayer's counterfoil at the bottom of the challan.
Documents required 1 Main portion of the challan and the taxpayer's
counterfoil form be filled in properly and the
amount and major head of account to which the
amount is to be accounted/credited be correctly
recorded therein.
2 Details of the Assessee code, name and address of
the taxpayer, nature and type of payment are to be
properly filled in.
3 The amount should be written correctly both in
words and figures.
Suggested time norms For physical payment of challan: 15-20 minutes.
for activity
For e-payment: On real time basis. Once the
customer account is debited, transaction gets
completed at Government website and tax will be
treated as payment made to Government. Amount
paid after 8.00PM, will be treated for next day
payment.
Dos &Do’nts Customer should be careful in filling of the details in
challan forms.
Customer’s obligation Assessee code is mandatory for making indirect tax
payments.

Grievance To be settled within reasonable time

Resolution/compensation

Any other important The facility is available for payment of indirect taxes
matter relating to the
through physical challan at authorized branches as
product
well as e-payment. For making e-payment, the
customers should have PNB's Internet Banking
User-id & passwords.

System generated computerized receipt is made

available to the tax payers.
Mandatory payment of Payment of Service tax/ Excise Duty through e-
Indirect Taxes through e- payment mode has been made mandatory for every
payment mode only assessee w.e.f. 01.10.2014. However, if the
Assistant Commissioner or the Deputy
Commissioner of Service Tax/ Central Excise, as the
case may be, having jurisdiction, may for reasons to
be recorded in writing, allows the assessee to
deposit the Service Tax/ Central Excise by any mode
other than internet banking, the same may be
deposited in our authorized branches.

Likewise, Custom Duty payment of Rs.1.00lac and

above is to be mandatorily paid through e-payment
only.
9. Collection of MCA21 (Ministry of Corporate Affairs) fees

Features of the product MCA21 fees can be paid at any authorized branch
in brief
(Total 261 branches) of the bank either in cash, direct
debit to account or by a cheque/draft drawn on the
same bank or another bank/branch at the same centre
where the payment is made. The payment of fees by
outstation cheques/drafts can also be made at any
authorized bank. Funds/amount deposited through
cheques/Drafts shall be credited to Governments’
account after realization of the instrument.
For availing various services of Ministry of Company
Affairs under MCA21, the service seeker/customers
can make also make e-payment, at any time of the day
without visiting the bank, by direct debit to their
account.
Customers of other banks can also make such
payment through NEFT.
Terms & Conditions To avail of the above facility a user is required to go to MCA
website (www.mca.gov.in) use a digital certificate or
password (as applicable) and utilize the services/facilities
under MCA21.
Documents required Every request submitted on MCA portal is identified by a
unique number known as the Service Request
Number(SRN). In case of Challan payments; the Challan
number is the SRN.

In case of online payments; SRN is given to the user, before s/he

is redirected to the banks’ payment gateway/ Bank’s site.

Suggested time norms For physical payment of challan: 15-20 minutes.

for activity
For e-payment: On real time basis. Once the customer
account is debited, transaction gets completed at MCA
website and fees will be treated as payment made to
Government. Amount paid after 8.00PM, will be treated
for next day payment.
Dos &Do’nts Customer should be careful in filling of the details in
challan forms OR making e-payment.

Customer’s obligation Customer must be registered with the Ministry of

Corporate Affairs. User-id/login-id & password/Digital
 certificate are required to access MCA21 website.

Grievance To be settled within reasonable time

Resolution/compensation

Any other important The facility is available for payment of MCA21 fees
matter relating to the
through physical challan at authorized branches as
product
well as e-payment. For making e-payment, the
customers should have PNB's Internet Banking User-id
& passwords.

Customers of other banks’ can also make MCA21 fees

through NEFT/RTGS using their banks’ internet
banking site, User - id & password.

System generated computerized receipt is made

available to the tax payers.

10. E-Payment of VAT

Features of the product Bank renders its customers the facility to make VAT
in brief
payments online for commercial tax department of
various States. This can be availed by customer of
any Centralized Banking branch of the bank. Using
this facility, the customers can make payments at
any time of the day.
Terms & Conditions For using the facility the customers must be
registered with valid TIN number. The customers
should have PNB's Internet Banking User-id &
passwords
Documents required This facility is available only for account holders of
PNB and TIN holders registered with Department of
Commercial Taxes of the concerned state.
Suggested time norms On real time basis. Once the customer account is
for activity
debited, transaction gets completed at Government
website and tax will be treated as payment made to
Government. Amount paid after 8.00PM, will be
treated for next day payment.
Dos &Do’nts The customer should be careful while filling the
 challan details at the time of remitting to funds
online.
Customer’s obligation While making payment customer should take due
precautions. No refund would be made by the bank
on the claim of customer that he has made excess or
multiple payments. The bank is not entitled to
change the payment heads or other information on
request of the customer and he has to directly take
up with the Govt. department for the same.
Grievance If two or more payments are made for the same
Resolution/compensation challan number, it is treated as duplicate payments.
Refund of duplicate payments would be done by the
bank.
Any other important 1. Using this facility, the customers can make
matter relating to the payments at any time of the day.
product 2. Payment/Transaction-id will be generated with
the link for cyber receipt/ Counterfoil of
Challan, which can be printed and kept for
future reference.

States, in which facility Delhi, Uttarakhand, Himachal Pradesh, Karnataka,

since started
Bihar,
Gujarat, Uttar Pradesh, Punjab, Rajasthan,
Maharashtra, Orissa, Jharkhand, West Bengal,
Chattisgarh, Andhra Pradesh, Telengana, Tamil
Nadu, Madhya Pradesh, Daman & Diu (UT) and
Kerala

11. E-Stamping of Documents (Payment of Non Judicial Stamp Duty)

Features of the product 1. An Internet application that gives one the convenience
in brief of paying stamp duty without obtaining stamp papers
etc.
2. It ensures that the stamp duty paid by the public
reaches the Government safely through a secure and
reliable mode.
3. It prevents the paper and process related fraudulent
practices and avoiding stamp paper scam.

Terms & Conditions The territory covered under this facility will be all the States in
India that have implemented the e-Stamping system.

Documents required Customer has to fill up application form for e-stamping of

documents. The amount can be paid by way of cash, Demand
 Draft, Pay order, transfer, RTGS and NEFT.
Suggested time norms The facility is available at the designated branches and a
for activity
receipt with unique number will be provided to the customer
immediately on deposit of stamp duty amount.

Time Norm is 20 to 25 minutes

Dos &Do’nts Customer should be careful in filling of the details in application

form
Customer’s obligation Stamp duty is a kind of Tax like Sales Tax or Income Tax. It
must be paid in full and on time to the Government. In case of
delay in payment of stamp duty, penalties are imposed.
Grievance To be settled within reasonable time
Resolution/compensation

Any other important The e-Stamp certificate will be system generated with issue
matter relating to the
details in the centralized database.
product

States, in which facility Delhi, Uttarakhand, Himachal Pradesh, Karnataka,

since started
Gujarat, UP, Punjab, Rajasthan and Chandigarh (UT)

12. Payment of E-Freight (Railways)

Features of the product Indian Railways has facilitated electronic payment of freight services
in brief
availed for transportation of goods. The facility allows online debit to
customer’s account and
credit to concerned Zonal Railways Headquarter account.

Earlier, State Bank of India was the only bank authorized by railways to
carry on this business. Now, our bank has also been authorized for this
business by the Ministry of Railways/ Finance, Railway Board and RBI.

Terms & Conditions To avail of the above facility, customer must have an account
exclusively for this purpose with the bank. No other debits would be
permitted in this account.
Any rail customer having regular business with Railway is to apply to
the Chief Commercial Manager (CGM) of the Zonal Railway on which
the booking station is located.

Documents required In addition to the dedicated account, the customer would be required to
open an irrevocable inland Letter of Credit / Bank Guarantee (valid for
12 months from the date of commissioning of the e-payment facility
 with a provision permitting its enhancement up to 15 days after the
validity period of LC, if required) as a fall-back in case account is short
of the required amount towards freight payment in favour of the
Railway at a branch of a bank mutually agreed upon by the customer
and Zonal Railway.

A tripartite agreement (TPA) is required to be signed among the Bank,

Customer and the Railways whereby the Customer will give mandate
to the bank to debit their account at the request of Railways for
payment of freight.
After execution of TPA between the Railways, Customer and PNB,
Railways will give a Unique 3 digit Customer Numeric Code to the
customer.
Suggested time norms When the customer books the goods for transportation at the
for activity originating point, the goods clerk at the loading point will key in the
customer code and other particulars. The information would pass
through Railway Server to PNB's Internet Banking and after necessary
authentication at bank's end account of the customer would be debited.
A corresponding message would be sent back. Bank will collect funds
from customer’s account and electronically credit the same to
Railway’s account during business hours or at the start of the next
business day if such a transaction takes place after close of business
hours.
When the payment confirmation is received by the goods clerk at the
originating station, Railways will release the goods on "paid E-RR"
basis. In case of insufficient funds, system will issue “To-Pay E-RR”.

Dos &Don’ts Customer should always maintain sufficient balance in their

dedicated account to meet the freight charges amount.

Customer’s obligation Customers are required to pay our service charges as given below:

 Freight amount up to Rs.30000/- : NIL

 Above Rs.30000/- and up to Rs.2.50 lac : Rs.1.40 per thousand

 Above Rs.2.50 lac and up to Rs.5.00 lac : Rs.1.25 per thousand
 Above Rs.5.00 lac: Rs1.00 per thousand (Minimum Rs.625/-
and Maximum Rs.1100/-)
 WEALTH MANAGEMENT PRODUCTS
1. PNB MetLife Insurance Products
2. Mutual Fund Business
 Principal PNB Asset Management Company
 UTI Asset Management Company
3. PNB-Oriental Royal Mediclaim Policy
4. 3 –IN- 1 Account under Depository services
5. Facility of E-Insurance Account to Bank’s clients
6. PPF

1. PNB MetLife Insurance Products

Bank has been Marketing & selling various Life Insurance Products of PNB MetLife India
Insurance Co Ltd as its Corporate Agent. Customers can also enquire and pay premium
online on www.pnbmetlife.com.
Why Life Insurance?
Life insurance is a unique investment that helps you to meet your dual needs - saving for
life's important goals, and protecting your assets.

 Life Risk Cover

 Death Benefits
 Return on Investment
 Tax Benefits
 Loan Options
 Life Stage Planning
 Additional benefits through riders

Products available for sale and their features are given hereunder:
1) Met Endowment Savings Plan- A Non-Linked Participating Product – A flexible
savings and protection plan

USP OF PRODUCT

 Decide the Premium &Payout date of your Choice;

 Earn more on your savings through accumulated bonus;
 Enjoy Double benefits of Investments & Protection;
 Avail tax benefits on Investment & returns;

PLAN AT A GLANCE
Minimum Age at Entry 20 Years
Maximum Age at Entry 60 Years (54 Years in Limited Pay 5 Option)
Maximum Age at Maturity 75 Years
Premium Payment Term Options Ltd Pay 5 Yrs Ltd Pay 5 Yrs Regular Pay
Minimum Policy Term 10 Years 15 Years 10 Years
Maximum Policy Term 20 Years 25 Years 30 Years
Minimum Sum Assured Rs.164000 Rs.257000 Rs.145000
Maximum Sum Insured Rs. 5 crore Rs. 5 crore Rs. 5 crore
Mode of payment Yearly/half Yearly/Quarterly/Monthly
2) Met Money Back Plan-Non Linked Money Back Life Insurance Plan–A
money back plan that provides money back from from 6th year to 10 year.

USP OF PRODUCT
 Survival Benefits; Get back 10% of Sum Assured every year from 6th policy
year to 10th
policyyear.
 Maturity Benefits; 60% of Sum Assured payable at Maturity;
 Death Benefits; Payment of Sum Assured to the nominee in case of
unfortunate death of
the insured.
PLAN AT A GLANCE
Minimum Age at Entry 13 Years
Maximum Age at Entry 55 Years
Maximum Age at Maturity 65 Years
Policy Term 10 Years only
Minimum Sum Assured Rs.250000
Minimum Premium Rs.23119
Maximum Premium Rs.5163875
Maximum Sum Assured Rs.5 crore
Mode of payment Yearly/half Yearly

3) PNB MetLife Saving Suraksha- Group Term Life Insurance Plan – One year
protection cover at affordable premiums

USP OF PRODUCT
 Available on Voluntary basis to all PNB SB account holders (existing as well
as new)
 Competitive premium in the industry.

PLAN AT A GLANCE
Coverage Type Group Term Insurance
Availability Optional for New & Existing Customers having Savings bank account
with PNB, who agree to sign the Customer consent Letter for Met
Complete Care
Entry Age Min – 18 years (As on last birthday)
Max – 64 Years (As on last birthday)
Maturity Age NA
Coverage Terms 1 Year (Renewable)
Sum Assured - Rs 1.00 lac for all customers irrespective of QAB
- Rs 2.00 lac for customers maintaining QAB > Rs25000/-
Premium Age Premium rates (Per Total Premium for Sum
Band thousand rupees of Assured of Rs.1.00 lac
Sum Assured). # (including Service Tax)
18-35 Rs.1.23 +Service Tax* Rs.139/-
36-45 Rs.2.30 + Service Tax Rs.259/-
 46-50 Rs.3.55 + Service Tax Rs.399/-
51-55 Rs.5.75 + Service Tax Rs.647/-
56-60 Rs.7.80 + Service Tax Rs.877/-
61-64 Rs.12.55 + Service Tax Rs.1411/-
*Service tax is payable on prevailing rates, which at present is
Rs.12.36 %.
# The premium rates are valid for one year. Premium on subsequent
renewal will be based on attained age and prevailing premium rate at
the time of such renewal.
Premium Payment
Annual
Mode
Free look Period 15 days Free look is applicable for the master policyholder i.e. Punjab
National Bank & Individual Members

4) Met Monthly Income Plan-10 Pay-Non Linked Deferred Participating

Endowment Plan – Plan and get regular & guaranteed monthly income for
15 years

USP OF PRODUCT
 Pay for 10 years to get guaranteed monthly regular income from 11 th to 25th
year;
 Maturity benefits- On survival to the maturity date, you will receive chosen
monthly income for the next 15 years on the expiry of 1 month after maturity
date;
 Accrued Bonus at the time of Maturity;
 Death benefit;

PLAN AT A GLANCE
Premium Payment Term 10 Years
Minimum Age at Entry 18 Years
Maximum Age at Entry 55 Years
Maximum Age at Maturity 65 Years
Policy Term 10 Years
Minimum Monthly Income Rs.1500
Maximum Monthly Income Rs.100000
Minimum Annualized Premium Rs.23280
Maximum Annualized Premium Rs.1820000
Base Sum Assured Annualized Premium X 11
Mode of Payment Yearly/Half Yearly
5) Met Smart One-Unit Linked Insurance Plan-Non-Participating – One time market
investment with protection plan.

USP OF PRODUCT
 Single Pay investment cum protection plan;
 2 Investment Strategies: Auto Rebalancing option and Self Managed option;
 Liquidity with partial withdrawals;
 Death benefits; Maturity Benefits;
 Tax Benefits
 PLAN AT A GLANCE
Minimum Age at Entry 0 Years (3 Months)
Maximum Age at Entry 65 Years
Minimum/Maximum Age at Maturity 18/75 Years
Policy Term 10-20 Years
Minimum Premium Rs.18000
Maximum Premium Rs.500000
Sum Assured Multiple 5 Times of Single Premium in the First
Policy Year & 1.25 times of Single
Premium for the remaining term of the
Policy
Premium Payment Modes Single

6) Met Smart Platinum-Unit Linked Insurance Plan-Non-Participating – whole

of life cover with savings, investment and growth.

USP OF PRODUCT
 Flexibility of various premium payment options;
 Flexibility to increase or decrease your Sum Assured;
 Death benefit;
 Liquidity with partial withdrawal;
 Tax benefits;
 Choice of 6 Unit Linked Funds for various risk appetites;

PLAN AT A GLANCE
Minimum Age at Entry 7 Years
Maximum Age at Entry 70 Years
Premium Payment Term (Years) 5 Pay/10 Pay/Entire term of Policy
Minimum Annualized Premium Rs.30000 for annual mode
Rs.60000 for other modes
Maximum Annualized Premium For minimum & maximum Sum Assured
multiple, as applicable for your age,
please refer to the Sum Assured Multiple
Table
Premium Payment Modes Annual, Semi-Annual, Monthly &
Quarterly

7) Met Smart Child-Unit Linked Child Insurance Plan – Plan that helps your
child to realize his/her dreams

USP OF PRODUCT
 Realizing your Child’s Dreams like Study Abroad or Provisioning for his dream
business;
 Protection in case of unforeseen Circumstances;
 PLAN AT A GLANCE
Minimum/Maximum Age at Entry (Life 18/55 Years
Insured)
Premium Payment Term (for beneficiary) 90 days/17 Years
Premium Payment Term (Years) Same as Policy Term
Maximum Annual Premium Rs.18000 p.a.
Maximum Annualized Premium Till age 35: Rs.2 lac, 36-45 age: Rs.1.25
lac, Age 46+ Rs.1 lac
Policy Term 10, 15 & 20 Years
Sum Assured 10 Times the chosen Annualized
Premium only
Premium Payment Annual, Semi-Annual, Quarterly
Monthly & PSP(Payroll savings
Programme)

8) Met DhanSamriddhi- Unit Linked Insurance Plan-Non-Participating –

Convenient single premium plan for HNIs

USP OF PRODUCT
 Convenient Single Premium Option;
 Choose how your money is invested for comprehensive Wealth
Management: Choice of 6 Fund options & Choice of Stocks, Bonds and
Money Market Funds;
 Withdraw funds in case of need any time after the first five years;
 Tax benefits on Purchase& Maturity of your investment ;
 Death Benefits; Maturity Benefits.

PLAN AT A GLANCE
Age at Entry 8-65 Years
Policy Term 10 Years
Minimum Single Premium Rs. 2 lac
Maximum Single Premium No Limit, Subject to underwriting conditions

Sum Assured Multiple Option to choose 10 or 1.25 times the Single

Premium ( only 1.25 times for above 40 years of age)

9) MetLife Retirement Savings Plan – Retirement

USP OF PRODUCT
 Guaranteed income for your golden years
 Part lump sum on maturity
 Extend accumulated savings
 Vesting Benefit: Sum Assured + Vested Simple Reversionary bonus plus
Terminal Bonus, if any.
  Death Benefit: Death Sum Assured + Accrued Simple Reversionary Bonus +
Terminal Bonus, if any; (Where Death Sum Assured is defined as 105% of all
Premiums paid (excluding service tax and extra premium, if any))
 Flexibility: You can defer the vesting date up to age 75 years.

PLAN AT A GLANCE
Min. Age at entry* 30 years
64 years (Limited Pay 10 years)
Max. Age at entry*
65 years ( Others)
Min / Max. age at Vesting* 50 / 75 years
Regular Pay & Limited Pay 10 Years: Rs 300,000
Minimum Sum Assured
Limited Pay 5 Years & Single Pay: Rs 500,000
Maximum Sum Assured As per our Board Underwriting Policy
Premium Payment Term Single Pay / 5 Pay / 10 Pay / Equal to Policy Term
Minimum Policy
Premium Payment Type
Term
Regular Pay & Limited Pay 5
Minimum Policy Term 10 years
years
Limited Pay 10 Years 11 years
Single Pay 5 years
SP: 20 years
Maximum Policy Term#
Others: 30 years
Minimum
Premium Payment Type Annualized
Premium
Regular Pay Rs. 7,044
Minimum Annualized
Premium Limited Pay 10 Years Rs. 13,128

Limited Pay 5 Years Rs. 35,990

Single Pay Rs. 262,250

10) Met Family Income Protector Plus - ( Non-Linked, Non-Participating Term

Assurance Plan)

USP OF PRODUCT
 Guaranteed monthly income provided to your family when you are not around for up
to 20 years.
 Tax efficient; both at the time of purchase and when the regular monthly income is
being paid out to your family.
 Cost effective way to protect your family
 Automatic increase in Sum Assured to create safety net when you are not around
 What’s more... you also have the option to take all your premiums back, in case
nothing happens to you by the end of the policy term!
  Great Employee Discount ranging from 3% to 5%.

PLAN AT A GLANCE
Particulars Boundary Conditions
Min/Max Age at entry* 25 years – 60 years (55 for Policy term 20 years)
Max. age at maturity* 75 years
Monthly Income Rs.10,000/-, Rs.25,000/- Rs.75,000/-, Rs.50,000/- &
Options Rs.100,000/-
Plan options Term Cover & Term with Return of Premium Option(TROP)
Policy Term options 10 years 15 years 20 years
Benefit Payout Period 240 months 180 months 120 months
Min. Premium (Term) Rs. 3,055 Rs. 2,780 Rs. 2,520
Max. Premium (Term) Rs. 1,26,160 Rs. 1,33,590 Rs. 83,450
Min. Premium (TRoP) Rs. 24,137 Rs. 11,852 Rs. 7,881
Max. Premium (TRoP) Rs. 6,29,670 Rs. 3,67,170 Rs. 1,85,800
Min Sum Assured 14.20 lakhs 12.00 Lakhs 9.10 Lakhs
Max. Sum Assured 1.42 Crs 1.24 Crs 0.95 Crs
Premium paying options Yearly, Half-Yearly, Monthly & PSP modes

Why this plan ?

• Unique proposition – Term and Term with Return of Premium plan with Monthly
Income Benefit structure or lump sum benefit
• Ease of enrollment – 3 simple questions
– Desired Monthly Income
– Duration of Cover
– Term or TROP
• Attractive non-medical limits
• Wider market appeal – affordable premium, Monthly Income structure
• Everyone needs it!

11) MetLife Major Illness Premium Back Cover - A Non-Linked, Non-

Participating, Health Insurance Plan
USP OF PRODUCT
 Pay for 10 years & stay covered for 10 years – Simple Structure
 SA as high as up to Rs. 50 lacs* - Protection against Financial exigencies in
case of major illnesses
 Return of premium in case of no major illness during the policy term
 Covers as high as 35 Critical Illnesses – highest in the industry
Tax benefits U/S 80C & 80D – income tax benefits
 PLAN AT A GLANCE


12) Met College Plan –A non-linked deferred participating endowment plan

USP OF PRODUCT
 Flexible saving option from 12 – 24 years

 Guaranteed fund for your child’s education during last 3 year of the Policy term.

 PNB Metlife pays premium in case untimely death of the insured parent

 Boost the maturity/final year payout with reversionary bonus and terminal bonus,
if any

 Tax benefits under section 80C and 10(10D)*

PLAN AT A GLANCE
Person Insured Father/ mother/ legal guardian of the child
Min. Age at entry* 20 years
Max. Age at entry* 45 years
Max. age at maturity* 69 years
Minimum Premium Annual Mode : Rs.18,000, Non Annual Mode: Rs.30,000
Maximum premium Rs. 42,44,482
Premium Payment Term Regular
Minimum Policy Term# 12 years
Maximum Policy Term# 24 years
Rs. 2,12,040, ( Sum assured based on Sum Assured
Minimum Sum Assured
Multiple ,age and term of the plan)
Maximum Sum Assured Rs. 5 Crores

13) MET LOAN & LIFE SURAKSHA - A Group Policy for PNB Housing Loan Customers
and Education Loan Customers

USP OF PRODUCT
 Creation of Asset without worry!
 Risk-absorption for the bank in case of unfortunate death of loan customer
 Family inherits asset not Loan!
 Peace of mind knowing that your family is protected
PLAN AT A GLANCE
Plan parameters Minimum Maximum
18 years
15 years in case of 65 years
Education Loan
Single Pay - 2 years Single Pay - 25 years
5 Year Limited Pay - 5
Policy Term 5 Year Limited Pay - 25 years
years
10 Year Limited Pay - 10 10 Year Limited Pay - 30
years years

Maturity Age of Person Insured - 70 years age last birth day

Group Size 50 Lives No Limit

Rs. 10,000 per life
Sum Assured per member No Limit*
(multiple of Rs 1 /-)
Premium Based on chosen Sum Assured
Premium Paying Options Single Pay, Limited 5 year Pay & Limited 10 year pay
Premium Paying Modes Single Pay & Annual
14) MetLife Bhavishya Plus - A Non-Linked Deferred Participating Endowment Plan

USP OF PRODUCT
 Flexible saving option from 12 – 24 years

 Guaranteed** fund during last 3 year of the Policy term

 PNB MetLife waives off premium in case of untimely death of the insured

 Boost the maturity/final year payout with reversionary bonus and terminal bonus,
if any

 Tax benefits under section 80C and 10(10D)*

PLAN AT A GLANCE
Min. Age at entry* 20 years
Max. Age at entry* 45 years
Max. age at maturity* 69 years
Yearly : 8,000 p.a
Minimum Premium Half Yearly : 10,000 p.a
Monthly : 15,000 p.a
Maximum premium Rs 17,999 p.a
Premium Payment Term Regular
Minimum Policy Term# 12 years
Maximum Policy Term# 24 years
Rs. 92,320 (Based on lowest Sum Assured
Minimum Sum Assured
multiple allowed under the plan)
Maximum Sum Assured Rs. 500,000
15) MetLife BachatYojana -A non-linked deferred participating endowment plan (Rural
Policy)

 Allows for Long term savings with affordable premiums

 You pay only for 10 years and get covered for 15 years
 Offers Sum Assured plus Bonus if any upon maturity
 In case of death during the policy tenure of 15 years, your family receives Sum
Assured plus bonuses , if any.
 Tax benefits under section 80C and 10(10D)*

PLAN AT A GLANCE

Min. Age at entry* 20 years

Max. Age at entry* 60 years
Max. age at maturity* 75 years
Premium Payment Term Options 10 years Limited Pay
Policy Term 15 years
Min. Sum Assured Rs. 64,800
Max. Sum Assured Rs. 5 Lakhs

Annual Semi-Annual Monthly/PSP

Min. Premium
Rs. 6,000 Rs.10,000 Rs.15,000
Max. Premium Rs. 23, 999 per Life

Annual, Semi-Annual, Monthly (only ECS)& Payroll

Modes allowed^
Savings Program (PSP)

16) Met Grameen Ashray- A Micro Insurance Non-Participating Term Plan– Short
term life insurance protection for the rural market.

USP OF PRODUCT
 Short Term Life Insurance protection plan;
 Specially designed for rural population yet suitable for urbanized low income
population;
 Simplified process;
 Easy documentation;
 Death benefit;

PLAN AT A GLANCE
Minimum Age at Entry 18 Years
Maximum Age at Entry 55 Years
Coverage Term 5 Years
Maximum Cover Ceasing Age 60 Years
Minimum Premium Rs.61
Maximum Premium Rs.1208
Minimum Sum Assured Rs.5000
Maximum Sum Assured Rs.50000
Premium Paying Mode Yearly
 2. Mutual Fund Business
 Principal PNB Asset Management Company

1. PRINCIPAL EMERGING BLUE CHIP FUND

 An open-ended Equity Scheme

 Investment Horizon—3 years & above.

USP OF PRODUCT
 Diversified equity fund that seeks to invest in fundamentally strong companies with
Mid and Small Cap Market Capitalization.
 Investment Objective - To achieve long-term capital appreciation by investing in
equity and equity related instruments of Mid Cap and Small Cap companies.

2. PRINCIPAL LARGE CAP FUND –

 An open-ended Equity Scheme

 Investment Horizon-3 years & above

USP OF PRODUCT
 Diversified equity fund that seeks to invest in fundamentally strong companies with
Large Market Capitalization of Rs.750 crores & above.
 Investors seeking portfolio with high correlation with the markets and want to invest in
an actively managed portfolio with prudent risk management practices.

3. PRINCIPAL SMART EQUITY FUND

 An open-ended Equity Scheme

 Investment Horizon- 3 years & above

USP OF PRODUCT
 The primary objective of the scheme is to seek to generate long term capital
appreciation with relatively lower volatility through systematic allocation of funds into
equity; and in debt/money market instruments for defensive purposes.
 Investors looking for long term investments with lesser volatility in returns.
 Investors looking for diversification.
4. PRINCIPAL TAX SAVING FUND

 Investors looking for long term investments in Equities and benefit of tax deduction.
 Lock in period of 3 years from date of allotment.

USP OF PRODUCT
 Benefit of Tax deduction of upto Rs.1 Lac under Section 80 C of Income Tax Act.
 This fund is suitable provided investments are held for long term. Equity markets
deliver superior risk adjusted returns over the medium to longer term
 Long term capital gains are tax free.
 PROCEDURAL GUIDELINES FOR AGRICULTURAL CREDIT

1. TIME SCHEDULE FOR DISPOSAL OF LOAN APPLICATIONS:

Credit Limit Time schedule (maximum)

Upto Rs. 2 lakh 2 weeks

Above Rs. 2 lakh & upto Rs. 50 lakh 4 weeks

Above Rs. 50 lakh & upto Rs. 100 lakh 5-6 weeks

Above Rs. 100 lakh & upto Rs. 100 crores 6-7 weeks

Above Rs. 100 crores 8-9 weeks

2. MARGIN NORMS:

(a) For production and/or Investment Credit:

Amount of loan Margin

Upto Rs.1,00,000/- (both for short term and medium Nil

term)
Above Rs.1,00,000/- to Rs.2 lakh 5%
Above Rs.2 lakh to Rs.5 lakh 10%
Above Rs.5 lakh 25%
Tractor Loan without mortgage of land/ IP 40% (cash
margin)

(b) Under PNB Krishi Card Scheme:

For production credit - NIL

(c) Under the Scheme of Agri-Clinics/Agri-Business Centres:

Amount of loan Margin

Upto Rs.5 lakh NIL

Above Rs.5 lakh 25%
NOTE:
(i) Where subsidy is available, the same should be treated as margin and no further
margin money should be stipulated unless subsidy falls short of requisite margin.

(ii) Labour and materials, etc., contributed by farmer should be treated towards building
up of margin.
(iii) Where the scheme has been approved by NABARD or any other Govt. agency the
terms and conditions stipulated by NABARD or Govt. agency in respect of margin
shall be followed.
(iv) In respect of Govt. sponsored schemes, the margin/security norms shall be as per
the respective schemes for agricultural advances or the above mentioned margin,
whichever is lower.

3. SECURITY NORMS:

A. Production Credit/ Security

Investment Credit
i) For loan upto Rs.1,00, 000/- Hypothecation of crops and/or assets created
out of bank loan.
ii) Above Rs.1,00, 000/- a) Hypothecation of assets and/or assets
created out of bank loan
AND
b) Charge on land as per Agricultural
Credit operations and Miscellaneous
Provisions Act of the State
concerned/Mortgage of agricultural land
valued at 100% of amount of loan for other
farmers and 75% of the loan amount for small
farmers/marginal farmers.
OR
Alternate security viz. charge/lien over liquid
securities such as term deposits/NSC/KVP,
etc. which may be considered adequate.
OR
Suitable third party guarantee
B. Under the Scheme of Agri-
Clinics and Agri-Business
Centres
i) For loan upto Rs. 5,00, 000/- Hypothecation of assets created out of bank
loan.
ii) Above Rs. 5,00, 000/- a) Hypothecation of assets and/or assets
created out of bank loan
AND
b) Charge on land as per Agricultural
Credit operations and Miscellaneous
Provisions Act of the State
concerned/Mortgage of agricultural land
valued at 100% of amount of loan for other
farmers and 75% of the loan amount for small
farmers/marginal farmers.
OR
Alternate security viz. charge/lien over liquid
securities such as term deposits/NSC/KVP,
etc. which may be considered adequate.
OR
Suitable third party guarantee
 LOANING POWERS: As per Loans & Advances Circulars issued from time to time.
Presently, in terms of Loans & Advances Circular No. 85/2014 dated 10.07.2014,
following loaning powers has been given at various levels:
(Rs. lakh)
S. Nature of facilities Incumbent Incharge of CM AGM DGM
No. JMG-1 MMG-II MMG-III (SMG- (SMG-V) (TEG-
IV) VI)
1. Aggregate commitment - 12 25 80 400 1000 2000
per borrower (Both
funded and non-funded)
2. Within (1) above
(A) Fund based
Out of this
(i) Secured 12 25 80 400 1000 2000
(ii) Unsecured 2 5 8 60 250 500

(B) Non fund based 6 10 30 150 500 2000

Note: (i) Officials upto AGM level shall exercise 50% and 25% of their secured fund based
powers in case of Term Loan and Book Debt facility respectively. (ii) The rate of interest and
loaning powers should strictly be followed as per Loans and Advances Circulars issued by
the Risk Management Division, H.O. from time to time.
CONFIDENTIAL REPORT (CR) ON BORROWER(S) AND GUARANTOR(S):
(i) For loans No CR to be collected. However, information furnished by borrower in
upto Rs.50,000/- loan application form must be verified by Incumbent
Incharge/Agriculture Officers and they will record their opinion to this
effect.
(ii) For loan above A brief CR on PNB 539 (Simplified Confidential Report on Borrowers
Rs.50,000/- & and Guarantors in respect of Farm Advances) may be obtained along
upto Rs. 10 lakh with the information furnished by borrower in Loan Application Form
(PNB 762R) and here again, the information furnished by borrower
must be verified by Incumbent Incharge/ Agriculture Officer; besides
their report on brief CR.
(iii) For loans above Regular CR may be compiled on bank’s prescribed Form PNB 282
Rs. 10 lakh A/B depending upon constitution of borrower.
OBTAINING OF “NO DUES CERTIFICATE”:
“No Dues Certificate” is not to be obtained for agricultural loans from individual borrowers
(including SHGs and JLGs) in rural and semi urban areas. However, for loans above Rs.
1.00 lakh, affidavit to this effect be obtained from such borrowers.
For borrowers in urban areas and borrowers other than above “No Dues
Certificate”/’Affidavit’ is not to be obtained for agricultural loans upto Rs.1,00,000/-.
However, for agricultural loans above Rs.1, 00,000/-, obtaining of Affidavit in lieu of "No
Dues Certificate" is allowed.
RBI has advised Banks to encourage use of alternative framework of due diligence as part of
credit appraisal exercise other than the ‘No Dues Certificate’ which could, among other,
consist of one or more of the following:
 Credit history check through credit information companies.
 Self declaration or an affidavit from the borrower.
 CERSAI registration
 Peer monitoring
 Information sharing among lenders
 Information search (writing to other lenders with an auto deadline)
  REVISED PRIORITY SECTOR GUIDELINES – COMPARITIVE ANALYSIS

Particulars Old Revised (effective from 23.04.15) –
Refer PSLB Cod. LBC Cir. No. 18/15
dated 06.07.2015
PS Categories Agriculture, MSE, Medium Enterprises, Social
Education, Housing, Export Infrastructure, Renewable Energy
and Other PS added.
Agriculture (National Goals) 18% of ANBC 18% of ANBC
Sub Target of Small & Marginal
Farmers (7% for 2016 & 8% 2017)
added.
Agriculture Categorized into Direct & Instead of Direct & Indirect divided into
Indirect 3 categories:
Farm Credit, Agri Infrastructure &
Ancilliary Activities.
Loans to Corporates/ FPCs, Aggregate loan limit per Limit more than Rs. 2 crore not part of
Partnership firms etc. borrower upto 2 crores Agriculture
engaged in Agriculture and (Direct Agriculture) & more
Allied activities than 2 crore ( Indirect
Finance to Agriculture).

Loans to Dealers of Agri Loans upto Rs. 5 crore part No mention

Inputs of Indirect Agriculture
Loans to RRBs for on Categorized as PS- Indirect Not included
lending for Agriculture & Agriculture
Allied Activities
Loans for construction and Categorized as Indirect Agri Now part of Agriculture (Agri-
running of cold storage or MSE based on Infrastructure)
facilities registration of unit.

Loans for Food & Agro Classified under MSE Loans upto Rs. 100 crore classified
Processing depending on investment in under Agriculture - Ancilliary
P&M
Loans for Soil Conservation Loans upto Rs. 100 crore part of
& Watershed Development, Agriculture – Agri Infrastructure
Plant Tissue culture, Agri
Biotechnology, Seed
Production, Production of
Biofertilizers, biopesticides
& vermi compost
Sub Target for Micro Target of 7% by March 16 and 7.5% by
Enterprises March 17.
Education Loans for study in India Outstanding upto Rs. 10 lakh
upto Rs. 10 lakh and upto irrespective of sanctioned limit.
Rs. 20 lakh for studies
abroad part of PS
Housing Loans up to 25 lakh in Loans up to 28 lakh in metropolitan
metropolitan centres & 15 centres and up to 20 lakh in other
lakh in other centres for centres for purchase/construction of a
purchase /construction of a dwelling unit per family provided the
dwelling unit per family. overall cost of the dwelling unit in the
metropolitan centre and at other centres
should not exceed 35 lakh and 25 lakh
respectively.
Social Infrastructure No mention loans up to 5 crore per borrower for
building social infrastructure for
activities namely schools, health care
facilities, drinking water facilities and
sanitation facilities in Tier II to Tier VI
centres ( population upto 1 lakh). Bank
loans for construction/ refurbishment
of household toilets and household
level water improvements, subject to
above criteria.
Renewable Energy Earlier loan for setting up Bank loans up to 15 crore to borrowers
off-grid solar & other off-grid for purposes like solar based power
renewable energy solutions generators, biomass based power
for households were part of generators, wind mills, micro-hydel
OTHER PS. plants and for non-conventional energy
based public utilities viz. street lighting
systems, and remote village
electrification.
Bank Loans to MFIs Household annual income Household annual income Criteria: does
Criteria: does not exceed not exceed 1, 00,000/- (rural) &1,
60,000/- (rural) & 1, 60,000/- (non-rural areas).
20,000/- (non-rural areas). Loan does not exceed 60,000/- in the
Loan does not exceed first cycle and 100,000/- in the
35,000/- in the first cycle subsequent cycles.
and 50,000/- in the Total indebtedness of the borrower
subsequent cycles. does not exceed 1, 00,000/-.
Total indebtedness of the
borrower does not exceed
50,000/-.

Overdraft Overdraft upto Rs. 50000 in Only overdraft upto Rs. 5000 in PMJDY
basic saving bank account accounts (annual income upto Rs.
& upto Rs. 5000 in PMJDY 120000 in rural and Rs. 160000 in non-
accounts (annual income rural)
upto Rs. 60000 in rural and Also part of weaker sections
Rs. 120000 in non-rural)
part of other PS.
Also formed part of Weaker
Sections
Weaker Sections Artisan,village cottage Artisan,village cottage industries:
industries: individual limit individual limit upto Rs. 1 lakh
upto Rs. 50000/- Distress persons other than farmer
Distress persons other than Loan upto Rs. 1 lakh
farmer Loan upto Rs. Individual women beneficiaries loan
50000. upto Rs. 1 lakh
Individual women
beneficiaries loan upto Rs.
50000/-
 SYNOPSIS OF AGRICULTURE CREDIT SCHEMES

1. PNB WOMEN EMPOWERMENT CAMPAIGN

Under the scheme following relaxations can be provided to women beneficiaries:

 Interest rate to be relaxed by 0.25% in Non-Priority Sector Advances and 0.50% in

Priority Sector advances

 Margin to be reduced to 10%, wherever the margin requirement is more than 10%

 Waiver of 50% upfront fee (wherever applicable)

The above relaxations will not be permissible in case of:

- Advances to women beneficiaries under Differential Rate of Interest Scheme as
these advances are already being extended at concessional rate of 4% p.a.

- Staff loans to women, i.e. concessional loans or any other loan where the female
staff is eligible for the loan only for the reason of being PNB employee.

- Female staff availing credit facilities where rate of interest is charged at concessional
rate as per various H.O. Circulars such as Jewellery, Life insurance Policies,
Conveyance loan, Festival Loan, Consumer Loan, Advances against UTI & other
Mutual Funds, Govt. Securities, NSCs, KVPs, IVPs, Bank’s own deposits, FDRs of
PNB Housing Finance Ltd./PNB Caps Ltd., Computer Loan and Housing Loan etc.
will not be eligible for the above relaxations.

Further only a single concession be made available as per option of the women beneficiary
as some other concessions under PNB Festival Season Bonanza, Weaker Sectors
advances and PNB Kalayani Card Scheme are also available. Simultaneous advantage of
more than one concession cannot be made available under any circumstances.

2. PNB KALYANI CARD SCHEME

PURPOSE :

For meeting working capital credit requirement of allied agricultural activities / miscellaneous farm/
non-farm activities either singly or in combination with other activities. The crop loan/short term loan
production credit requirement of women beneficiaries for raising crops should be covered through the
KCC facility only.

ELIGIBILITY :

 Literate/illiterate women dwelling in rural/semi-urban areas who have attained the age of majority
shall be eligible under the Scheme.
 Such Women shall include individuals, farmers, landless labourers , agricultural labourers, tenant
farmers, share croppers, lessee farmers, etc., having necessary aptitude and experience for the
activity.
EXTENT OF LOAN: Rs. 1 lakh only

MARGIN: Nil

REPAYMENT: Aggregate credits into the account during 12 months period should at least be equal
to the maximum outstanding in the account.
3. SCHEME FOR FINANCING WOMEN JOINT LIABILITY GROUPS (JLGS) –
COLLATERAL FREE UPTO Rs. 10 LAKH

ELIGIBILITY: Women JLGs who operate as one borrowing unit.

PURPOSE:
(a) Dairy/ Poultry/ Goat & Sheep rearing/ Fishery/ Piggery
(b) Custom Hiring Units
(c) Crop Production
(d) Food and Agro Processing
NATURE OF FACILITY: Term Loan and/ or Working capital

RATE OF INTEREST: As per chart given separately.

MARGIN:
Loan Amount Margin
Upto Rs. 1 lakh NIL
Above Rs. 1 lakh to Rs. 2 lakh 5%
Above Rs. 2 lakh 10%
SECURITY:
Loan Amt. Security
i) Upto - Hypothecation of crop/ assets created out of Bank loan.
Rs.10 lakh and
- Group Guarantee
ii) Above - Hypothecation of crop/ assets created out of Bank loan.
- Group Guarantee
Rs.10 lakh
and
- Additional collateral as per Agriculture guidelines
4. FINANCING TO SELF HELP GROUPS (SHGs)
OBJECTIVES:
a) To evolve supplementary credit strategies for meeting the credit needs of the poor by combining
the flexibility, sensitivity and responsiveness of the informal credit system with the strength of
technical and administrative capabilities and financial resources of the formal credit institutions.
b) To build mutual trust and confidence between bankers and the rural poor. To encourage banking
activity, both on the thrift as well as credit sides, in a segment of the population that the formal
financial institutions usually find difficult to cover.

SIZE OF GROUP: The group could consist of 10-20 members.

QUANTUM OF CREDIT:
The quantum of credit given should be in proportion to the savings mobilized by the group. The
proportion of savings to loan could vary from 1:1 to 1:4 depending upon the assessment of the SHG
by the branch.

Financing to SHGs upto 10 times of their savings can be provided in 3 stages as follows:
FIRST STAGE After six months of formation of Group 1:4
SECOND STAGE Completion of 1 year from the date of first 1:7
financing
THIRD STAGE Completion of 1 year from the date of 1:10
second financing
5. NATIONAL RURAL LIVELIHOOD MISSION (NRLM)
The Ministry of Rural Development, GOI has launched NRLM by restructuring Swarnajayanti Gram
Swarozgar Yojana (SGSY) replacing the existing SGSY scheme, effective from 01.04.2013.
The aim of the programme is poverty reduction through building strong institutions of the poor,
particularly women, and enabling these institutions to access a range of financial services and
livelihoods services.
ELIGIBILITY:
 SHG should consist of 10-15 persons. In difficult/ remote tribal areas/ groups with disabled
persons – min. 5 persons.
 SHG should be in active existence at least since the last 6 months as per the books of account
of SHGa and not from the date of opening of S/B account.
 SHG should be practicing ‘Panchasutras’ i.e. Regular meetings, Regular savings, Regular
inter loaning, Timely repayment and Up to date books of accounts.
 Qualified as per grading norms fixed by NABARD. As and when the Federations of SHGs
come to existence, the grading exercise can be done by the Federations to support the Banks.
 The existing defunct SHGs are also eligible for credit if they are revived and continue to be
active for a minimum period of 3 months.

FINANCIAL ASSISTANCE:
Revolving fund minimum Rs. 10000/- and maximum Rs. 15000 per SHG would be provided by
NRLM. Capital subsidy has been discontinued under NRLM.
QUANTUM OF LOAN:
 First dose: 4-8 times to the proposed corpus during the year or Rs. 50,000 whichever is
higher.
 Second dose: 5-10 times of existing corpus and proposed saving during the next 12 months or
Rs. 1.00 lakh, whichever is higher.
 Third dose: Minimum of Rs. 2 lakhs, based on the micro credit plan prepared by the SHGs
and appraised by the Federation/ Support agency and the previous credit history.
 Fourth dose onwards: Loan amount can be between Rs. 5-10 lakhs for fourth dose and/ or
higher in subsequent doses. The loan amount will be based on the micro credit plans of the
SHGs and their members.

6. FINANCING TO JOINT LIABILITY GROUPS (JLGs)

OBJECTIVES:

 To augment flow of credit to farmers, especially small, marginal, tenant farmers, oral lessess,
share croppers/ individuals taking up farm activities.
 To serve as collateral substitute for loans to be provided to the target group.
 To build mutual trust and confidence between bank and the target group.
 To minimize the risks in the loan portfolio for the banks through group approach, cluster
approach, peer education and credit discipline.
 To provide food security to vulnerable section by enhanced agriculture production,
productivity and livelihood promotion through JLG mechanism.

GENERAL FEATURES OF JLG:

A Joint Liability Group (JLG) is an informal group comprising of 4-10 individuals coming together
for the purpose of availing bank loan on individual basis or through group mechanism against mutual
guarantee. Generally, the members of a JLG would engage in a similar type of economic activity in
the Agriculture and Allied Sector. The members would offer a joint undertaking to the bank that
enables them to avail loans. JLG members are expected to provide support to each other in carrying
out occupational and social activities.

CRITERIA FOR MEMBERSHIP:

i) Members should belong to similar socio-economic status, background and environment

carrying out farming and Allied activities and who agree to function as a joint liability
group. This way the groups would be homogeneous and organized by likeminded
farmers/ individuals and develop mutual trust and respect.
ii) The members should be residing in the same village/ area/ neighbourhood and should
know and trust each other well enough to take up joint liability for group/ individual
loans.
iii) Members who have defaulted to any other formal financial Institution, in the past, are
debarred from the Group Membership.
iv) More than one person from the same family should not be included in the same JLG.

JLG MODELS:
Branches can finance JLGs by adopting any of two models.

Model A - Financing Individuals in the JLG

Model B – Financing the JLG as a Group.

EXTENT OF LOAN: Need based both under Model A & B.

MARGIN, INTEREST AND SECURITY NORMS:

Margin, Rate of Interest and Security norms shall be as applicable to individual Agriculture scheme
under which finance is extended.

7. PRODUCE (MARKETING) LOAN SCHEME

PURPOSE:

To meet short term credit requirement to adjust /repay the outstanding KCC limit availed by farmers
from the branch and to procure better price by storing farm produce and selling it at favourable price
within a specified period.

ELIGIBILITY:

All the farmers irrespective of whether they were given crop loans for raising the produce or not will
be eligible for advances. However where the farmers have availed KCC facility for crop production
/composite cash credit limit from our bank for raising the crops, the same should not be overdue for
repayment and this limit should be recovered/adjusted out of the Produce (Marketing) Loan.

EXTENT OF LOAN:
Maximum loan upto Rs.50 lakh.

75 per cent of value of the minimum support price or current market price whichever is lower at the
time of disbursement.

REPAYMENT:Repayment within a maximum period of twelve months from the date of

disbursement. Insurance of stock hypothecated to bank should be done as per bank rule
including quality deterioration clause for loan exceeding Rs.10,000/-.
8. CAPITAL INVESTMENT SUBSIDY FOR
CONSTRUCTION/EXPANSION/MODERNIZATION OF COLD STORAGES AND
STORAGES FOR HORTICULTURE PRODUCE

PURPOSE :
For Construction/ Expansion/ Modernisation of Cold Storages and Storages for Horticulture Produce
so as to minimise post-harvest losses being suffered by farmers particularly small and marginal
farmers.
ELIGIBILITY :
Unless otherwise specified, organizations/promoters, such as NGOs, Association of Growers,
Individuals, Partnership/Proprietary Firms, Companies, Corporations, Cooperatives, Agricultural
Produce Marketing Committees, Marketing Boards/ Committees, Municipal Corporations/
Committees, Agro-Industries Corporations, SAU’s and other concerned R&D organizations are
eligible to get assistance under all the NHB schemes.

EXTENT OF LOAN: Need based

MARGIN: Min-25% and Max-54%

SUBSIDY:

I. The subsidy will be available @ 40% of the Capital cost of project in general areas and 55% in
case of Hilly & Scheduled Areas .
II. However, the subsidy will be available for maximum storage capacity of 5000 MT and the rate
will vary from Rs 1000/- to Rs 32000/- per MT depending upon the type of Storages.
III. Credit Components should be at-least 15% more than the admissible rate of subsidy.
IV. Only those projects shall be eligible which meet prescribed minimum technical standards and the
notified latest technical standards and protocol prescribed by the Ministry of Agriculture for the
purpose are followed by the beneficiary.
V. Release of the estimated (tentative) subsidy in the Subsidy Reserve Fund (to be maintained by the
bank) after release of at least 50% of term loan into the project bank loan account. The provision
of estimated (tentative) subsidy under this system shall be applicable to all the projects under the
scheme, irrespective of whether Letter of Intent (LOI) has been earlier granted or not.

REPAYMENT: Depend upon the cash flow, max. upto 9 years including a grace period of 2 years.

9. AGRICULTURE MARKETING INFRASTRUCTURE SCHEME (AMI)

The scheme has replaced the Rural Godown and Agriculture Marketing and Infrastructure Scheme
(AMIGS)
PURPOSE:

(i) Development of marketing infrastructure such as common facilities in the market yards like
platforms for auction, loading unloading, drying, cleaning etc.

The ancillary/ supporting infrastructure like parking sheds, internal roads, garbage disposal,
boundry walls etc. are also permissible components. However, stand-alone ancillary/ supporting
infrastructure projects will not be assisted.

(ii) Functional infrastructure for collection/ assembling, drying, cleaning, grading, quality
certification, waxing, value addition facilities (without changing the product form) etc.

(iii) Infrastructure for direct marketing of agricultural commodities from producers to consumers/
processing units/ bulk buyers, etc.
(iv) Infrastructure for E-trading, market intelligence and market related extension.

(v) Mobile infrastructure for post-harvest operations viz. grading, packing, quality testing etc.
including reefer vans, or any other refrigerated vans. However, transport vehicles such as
trucks, van etc. will not be permissible for assistance.
(vi) Storage infrastructure like godowns including stand- alone silos for storage of food grains with
necessary ancillary facilities like loading, unloading, bagging facility etc., excluding railway
siding.
However, Assistance for renovation will be restricted to storage infrastructure projects of
cooperatives only.

Note: Stand alone cold storage projects are not admissible for subsidy under the scheme.
However, cold storage as a part of a permissible integrated value chain project will be
eligible.

ELIGIBILITY :

(i) Individuals, group of farmers/ growers, Registered Farmer Producer Organizations (FPOs)
(ii) Partnership/ Proprietary firms, Companies, Corporations
(iii) NGOs, Self Help Groups (SHGs)
(iv) Cooperatives, Cooperative Marketing Federations;
(v) Autonomous Bodies of the Government, Local Bodies (excluding Municipal Corporations for
storage infrastructure projects), Panchayats;
(vi) State agencies including State Government Departments and autonomous organization / State
owned corporations such as Agricultural Produce Market Committees & marketing Boards,
State Warehousing Corporations, State Civil Supplies Corporations etc.
EXTENT OF LOAN: Need based

MARGIN : 20%

SUBSIDY: The subsidy available under the scheme is as under:

For Storage Infrastructure Projects:

a) 33.33% of the capital cost of the project. In case of projects located in North – Eastern States,
Sikkim, UTs of Andaman & Nicobar and Lakhsdweep Islans and hilly areas, maximum ceiling
on subsidy will be Rs. 4.00 crore.
b) In case of Registered FPOs, Panchayats, Women, SC/ST beneficiaries and their self help
groups / co-operatives and SC/ST entrepreneurs & their self-help groups/ Co-operatives (in areas
other than (a) above), 33.33% of capital cost of project subject to maximum ceiling of Rs.3
crore.
c) 25% of the capital cost of the project to all other categories of beneficiaries, subject to a
maximum ceiling on subsidy of Rs. 2.25 crore.

For Infrastructure Projects Other than Storage Infrastructure:

a) 33.33% of the capital cost of the project. In case of projects located in North – Eastern States,
Sikkim, UTs of Andaman & Nicobar and Lakhsdweep Islans and hilly areas, maximum ceiling
on subsidy will be Rs. 5.00 crore.
b) In case of Registered FPOs, Panchayats, Women, SC/ST beneficiaries and their self help
groups / co-operatives and SC/ST entrepreneurs & their self-help groups/ Co-operatives (in areas
other than (a) above), 33.33% of capital cost of project subject to maximum ceiling of Rs.5
crore.
c) 25% of the capital cost of the project to all other categories of beneficiaries, subject to a
maximum ceiling on subsidy of Rs. 4 crore.
REPAYMENT: Min. 5 years and Max.11 years (including gestation period of 1-2 years)

10. SCHEME FOR FINANCING AGAINST PLEDGE OF WHR ISSUED BY COLD

STORAGE

ELIGIBILITY: Individual Farmers, Corporates, Partnership firms and institutions engaged in

Agriculture and Allied Activities are eligible to be covered under agriculture credit.
EXTENT OF LOAN: Term Loan – Need based, subject to maximum of Rs. 50 Lakh per borrower.

MARGIN: Minimum 20%, can be increased based on commodity volatility.

RATE OF INTEREST: MCLR + 1.25%

 Set up Sourcing Limit based on capacity of cold storage w.r.t market value of the
commodities stored.
 Pledging of WHR issued by the Cold Storage and SR issued by collateral manager.
 Quality and quantity will be certified by the collateral manager bedsides providing watch and
ward.
 Goods covered under WHR will be under Lock and key of the cold storage.
 After repayment by the borrower, instructions will be issued by Bank to collateral manager
for release of the commodity, which shall be conveyed by him to the cold storage.

11. SCHEME FOR FINANCING TO COLD STORAGE UNITS FOR FACILITATING

THE FARMERS AND ALSO TO MEET RUNNING EXPENDITURES OF COLD
STORAGES

PURPOSE: To provide working capital facility to the Cold Storage units for facilitating the farmers
against stock of their agriculture produce and also to meet the running expense (electricity bills,
repair, maintenance, etc) of the Cold Storages.
ELIGIBILITY: All existing Cold Storage units having satisfactory record.
NATURE OF CREDIT FACILITY: Cash Credit.
RATE OF INTEREST: MCLR 1 year
APPLICATION OF INTEREST: On half yearly basis. Interest will be accrued on monthly basis for
Profit & Loss purpose but collection / demand will be made on half yearly basis
MARGIN: 25%
SECURITY: Collateral Security having realisable value equivalent to 150% of the loan amount.
PROCESSING / UPFRONT FEE: 50% of the applicable amount.

12. SCHEME FOR FINANCING AGAINST PLEDGE OF WAREHOUSE RECEIPTS

ISSUED BY COLLATERAL MANAGERS

NATURE OF FACILITY: Demand Loan / Cash Credit.

EXTENT OF LOAN: Rs. 50 Lakh (at present) to borrowers eligible under Agriculture Credit.
Maximum Rs. 50 crore to other category of borrowers under PS Credit.

ELIGIBLE COMMODITIES: Any non perishable agricultural commodity which is not on the
restrictive list of state/ central Govt./Selective Credit Control of RBI.

MARGIN: 20% to 40%, on various commodities.

RATE OF INTEREST: MCLR + 1%

SECURITY:
PRIMARY – Pledge of Warehouse Receipts (issued by Collateral Management Companies) duly
endorsed in Bank’s favour.
COLLATERAL SECURITY: Waived on continual basis subject to periodic review of portfolio at
Corporate level.

REPAYMENT: Maximum 12 months

LIST OF APPROVED COLLATERAL MANAGERS:
 National Bulk Handling Corporation (NBHC)
 Star Agriwarehousing & Collateral Management Limited (SACML)
 National Collateral Management Services Limited (NCMSL)
 Shree Shubham Logistics Limited (SSLL) for Rajasthan and Maharashtra State only
 Maharastra State Warehousing Corporation (MSWC) for Maharastra State only
 Central Warehousing Corporation (CWC)
 Origo Commodities India Pvt. Ltd. (Origo)
 LTC Commercial Company Pvt. Ltd. (LTC)
 Edelweiss Agri Value Chain Ltd.
13. FINANCING TO FOOD AND AGRO PROCESSING UNITS
DEFINITION OF FOOD AND AGRO PROCESSING:
 Food processing is the transformation of raw ingredients, by physical or chemical means
into food, or of food into other forms. Food processing combines raw food ingredients to produce
marketable food products that can be easily prepared and served by the consumer.
 Agro processing is set of activities carried out for conservation and handling of produces,
originating from agricultural farm, livestock, aquaculture sources and forests for their conservation,
handling and value-addition to make them usable as food, feed, fibre, fuel or industrial raw material.
The scope of the agro-processing industry encompasses all operations from the stage of harvest
till the material reaches the end users in the desired form, packaging, quantity, quality and
price.
As per revised Priority Sector Guidelines, loans for Food and Agro-processing up to an aggregate
sanctioned limit of Rs.100 crore per borrower from the banking system are now part of Agriculture.
All the existing MSME guidelines applicable on Food & Agro Processing shall remain in force i.e. the
branches shall process the loan application under the category as per MSME guidelines and will also
exercise loaning powers as given for MSME advances.
Seeing the business potential under the segment Bank has prescribed following concessions for loans
under the activity:
Interest Concession:

Internal Risk Collateral Coverage linked ROI

Rating/ PNB Above 100% Above 75%-100% 50%-75% Below 50%
Score
A1 >70 MCLR 1year MCLR1year MCLR1year+0.35% MCLR1year+0.60%
&
A2
A3, ≤ 70>52 MCLR1year+ MCLR1year+0.85% MCLR1year+1.10% MCLR1year+1.35%
A4 0.60%
&
B1
The above concessions will be applicable subject to the following stipulations:
(i) Concessional ROI will be applicable from retrospective effect i.e. from 01.10.2015 upto
31.03.2017.
ii) Discretion to pass the concession / relaxation of interest rate in existing as well as in new
accounts is to be exercised by sanctioning authority not below the level of CACs headed by the Circle
Head, judiciously on selective basis, in respect of proposals falling upto their vested powers only,
except in case of HOCAC-III headed by CMD, which can permit relaxation in respect of proposals
falling under the power of MC also.
iii) As the above interest rates are scheme specific concessional rates, no further relaxation in
ROI to be allowed upto the level of CACs headed by GMs (HO/Field).

iv) In the accounts having credit risk rating below B1 (Score below 52), rate of interest as per
L&A Circular No. 48 dated 23.04.2014 or circulars issued from time to time shall be applicable.

Concession in processing/ upfront fee:

50% concession in the applicable processing/ upfront free upto 30.09.2016

14. SCHEME FOR FINANCING AGRI-BUSINESS PROJECTS WITH VENTURE

CAPITAL ASSISTANCE FROM SMALL FARMERS' AGRI-BUSINESS CONSORTIUM
(SFAC)

PURPOSE:

To provide Venture Capital Assistance to agri-business projects and to set up a Project Development
Facility to assist producer groups/ organizations in formulation of economically viable agri-business
projects.

ELIGIBILITY:
SFAC will provide Venture Capital Assistance for qualifying projects of individuals/ producer groups
/ organizations which meet the following criteria: -
 Projects are dependent upon agricultural or allied produce,
 Projects provide direct access to producers as assured market,
 Projects encourage farmers to diversify into high value crops aimed to increase farm incomes,
 The Bank has accepted the project for grant of term loans after satisfactory techno-commercial
feasibility.

EXTENT OF LOAN:
Need based.
MARGIN NORMS: As applicable to individual scheme under which finance is extended.
ELIGIBLE COST OF THE PROJECT:
Min Rs.15.00 lakh (Rs. 10.00 lakh for Hilly and North- Eastern states and backward districts) and
Maximum upto Rs.5 crore.
In special cases project cost may go upto Rs.10 crores.
Projects recommended by State SFACs can be considered for higher assistance under the Project
Development Facility (PDF).
EXTENT OF VENTURE CAPITAL ASSISTANCE :-
(i) 26% of prmoter’s equity or
(ii) Rs 50 Lakh , whichever is lower.

In North- Eastern Region, Hilly States (Uttarakhand, Himachal Pradesh, Jammu & Kashmir) and in
all cases in any part of the country where the project is promoted by a registered Farmer Producers
Organization ,the quantum of venture capital will be the lowest of the following:
(i) 40% of the promoter’s equity
(ii) Rs. 50.00 lakh
REPAYMENT : Repayment of loan shall synchronize with the income generation from the
qualifying projects. Normally, repayment period will be as prescribed under the respective scheme.

15. TRUCKS & OTHER TRANSPORT VEHICLE TO FARMERS

PURPOSE :

Purchase of new truck/new motorized light/medium vehicles, like tempo, matador, jeeps, pick up
vans, mini trucks made by Standard Manufacturing Concerns, etc. two wheelers to farmers for
transport of agricultural inputs /produce.
ELIGIBILITY :
An Individual/Hindu Undivided Family or an association of persons (not being a company or a
cooperative society), engaged in farming or allied activities, holding land:-
3 acres or more (for purchase of truck) &
2 acres or more (for light & medium vehicles like Jeep, Pick up Vans, Mini Trucks etc.) & 1 acre or
more for purchase of two wheelers)
EXTENT OF LOAN :
Need based
REPAYMENT : 60 months
(Circle heads may extend upto 72 months)
For two wheelers: Max. 5 years in 10 half yearly instalments.

16. FINANCING DEVELOPMENT OF HORTICULTURE (FRUIT/FLOWER/

VEGETABLE) & PLANTATION CROP

PURPOSE:
 Establishment & development of new orchards or grove of fruit crops, plantation crops,
spices crops, ornamental crops, medicinal plants, essential oils/ aromatic plants etc.,
 Rejuvenation of existing orchards or plantation ( to be sanctioned by Circle Heads)
 Raising vegetables, raising flower crops,
 Intercropping in horticulture crops,
 Marketing Loan ( to meet picking, grading, crating forwarding or transportation costs).
 Construction of Green House & Purchase of equipments for Green House.
ELIGIBILITY:
 Individual farmer or group of farmers having aptitude/ adequate experience together with
stipulated land holding (either as owner or tenant /lessee on long term basis (at least three
years more than economic life of projects )

 Public Sector Undertakings or private firms desirous of seeking financial assistance for
plantation of fruit trees or other economic plants on project basis.

EXTENT OF LOAN : Need Based

Working capital loan would depend upon scale of finance
Marketing Loan: Not to exceed 20% of estimated value of crops.
REPAYMENT:
(i) 4-15 years (inclusive of gestation period)
Economic life, gestation period and repayment period for various horticulture crops and plantation
crops is given in appendix I of codified Cir.02/13 dated 1.2.13).
17. SCHEME FOR FINANCING GREEN HOUSES

PURPOSE:
Financial assistance can be given for:
(i) Construction of green house/ poly house;
(ii) Purchase of equipments/machinery ;
(iii) Purchase of inputs and other expenses ;
(iv) Requirement of post harvest operations and marketing
ELIGIBILITY:

The applicant should own required agricultural land and the site should be well connected with
market. Good quality water, electricity, drainage facility etc should also be available.
Loan assistance may be extended to only those progressive farmers who are already following modern
agricultural technologies and have some experience/training in green house or for expansion to those
farmers who are already having green house.
EXTENT OF LOAN:

Need based. The project report submitted by the applicants should be thoroughly scrutinized.
REPAYMENT:

Repayment of term loan may be 5-7 years depending upon the quantum of loan, purpose of loan and
request of the applicant.
For short term production credit the repayment may be 12/18 months as per KCC scheme.

18. SCHEME FOR FINANCING MUSHROOM CULTIVATION

PURPOSE:
 Finance is considered for growing popular variety of mushroom (White Button, Oyster &
Paddy Straw);
 To construct buildings, packing and broiler room, AC room, water tank, platform and set up
broiler/ insulation blowers, steel racks, water supply line etc.
Working capital (initially for one crop only) may also be considered towards raw material (straw

chicken manure, chemicals, seeds etc.) labour and diesel etc.

ELIGIBILITY:

Individuals as well as for large sized units possessing adequate experience of mushroom cultivation.

EXTENT OF LOAN: Need based

REPAYMENT:
Maximum 7 years, including gestation period of 6 months

19. SCHEME FOR FINANCING MUSHROOM SPAWN PRODUCTION PURPOSE:

Financial assistance for spawn production is considered for the purpose of recurring expenditure as
well as investment costs as an integral loan.

ELIGIBILITY:
Individuals as well as large sized units possessing qualification in plant pathology or having proper
background and training for spawn production.

EXTENT OF LOAN: Need based

REPAYMENT: 7 years ( including gestation period of one year)
20. SCHEME ON ORGANIC FARMING
PURPOSE: Loan may be given for the following:
(i) Purchase of inputs like seeds, bio- fertilizers, bio-pesticides, vermi compost, Farm
Yard Manure (FYM) etc.
(ii) Land Development
 (iii) Small farming equipments
(iv) To help farmer for conversion from conventional farming to organic farming.
(v) Investment credit to develop a farm design and management under Organic Farming
for an initial period of 5 years.
ELIGIBILITY: All individuals/ SHGs/ JLGs having sufficient land to produce crops/ vegetables.
Vacant land in/around residential houses with right to use such land may also be used for the purpose.
NATURE OF FACILITY: Cash Credit (in form of KCC) and/or Term Loan.
EXTENT OF LOAN: Need Based.
REPAYMENT:
For production credit – As per KCC guidelines.

For Term Loan – As per the purpose for which the finance has been obtained
Margin: As per extant Bank guidelines.
21. SCHEME FOR FINANCING TO FARMERS/PRODUCERS UNDER CONTRACT
FARMING ARRANGEMENT
PURPOSE: To meet credit requirements of the individual farmer/producer identified for production
of specified crops/ commodities by way of Working Capital and /or Term Loan as per the
requirement.
TARGET GROUP: Individual farmer/producer willing to produce specified crops/commodities as
mentioned in the forward agreement between the Buyer & the Farmer.
ELIGIBILITY: Eligibility criteria shall be as per Bank’s guidelines (Scheme wise).

NATURE OF FACILITY: Term Loan and /or Working Capital.

EXTENT OF LOAN: Need based, subject to fulfillment of eligibility criteria of the borrower as per
extant Bank guidelines.

MARGIN (OTHER THAN KCC/ CROP LOAN): Norms for margin have been relaxed as under:
For loans upto Rs. 1.00 lakh NIL
For loans above Rs. 1.00 lakh upto Rs. 5 lakh 10%
For loans above Rs. 5 lakh 15%
SECURITY:

Primary: Hypothecation of crop/ assets created out of bank loan.

Collateral:

For loans upto Rs. 3.00 lakh NIL

For loans above Rs. 3.00 lakh As per prevalent guidelines

REPAYMENT: As per extant guidelines pertaining to the particular scheme.

22. SCHEME FOR FINANCING TO FARMER PRODUCER COMPANIES (FPCs)
PURPOSE:
To meet the Financial needs of the Farmer Producer Companies (FPCs) by way of Working Capital
and/ or Term Loan as per the requirement.
TARGET GROUP:
FPCs registered with Registrar of Companies and engaged in agriculture and allied activity.
ELIGIBILITY: FPCs fulfilling following criteria will be eligible for Credit Guarantee coverage
from SFAC for Loan up to Rs. 1 Crore without any Collateral Security / Third Party guarantee:
1. It is a duly registered FPC as per section IXA of the Indian Companies Act.

2. It has raised equity from its Members as laid down in its Articles of Association/Bye Laws.

3. The number of its individual shareholders shall not be lower than 500.

4. Minimum 33% of its shareholders are small, marginal and landless tenant farmers.

5. Maximum shareholding by any one member other than an Institutional member is not more than
5% of total equity of the FPC.

6. It has a duly elected/nominated Board with a minimum of five members and having adequate
representation from farmers and minimum one woman member.

7. It has a duly elected management Committee.

8. It has a business plan and budget for 18 months

NATURE OF FACILITY: Term Loan and /or Working Capital

EXTENT OF LOAN: Need Based.

FEE PAYABLE TO SFAC:

1. Guarantee Fees*: Onetime Guarantee Fee calculated @0.85% of the sanctioned Credit
Facility, subject to a maximum of Rs. 85,000/- (Rs. Eighty Five Thousand only).

1. Annual Service Fee*: In addition to one time Guarantee Fee, an Annual Service Fee of
0.25% of sanctioned limit per annum is to be paid

*To be borne by FPCs.

23. SCHEME FOR FINANCING TO REGISTERED FARMER PRODUCER

ORGANISATIONS (FPOs)

PURPOSE: To meet the Financial needs of the Farmers Producers Organizations by way of Working
Capital or Term Loan as per the requirement.

TARGET GROUP: FPOs registered under any Statute of Law.

NATURE OF FACILITY: Term Loan and /or Working Capital.

EXTENT OF LOAN: Need Based

24. SCHEME FOR FINANCING AGRICULTURE ACTIVITIES ON UNREGISTERED

LEASED / RENTED LAND

OBJECTIVE: To provide credit support to farmers who practice Agriculture on unregistered leased
land/ rented land.
PURPOSE: Loan may be given for Agriculture/ Allied Agriculture activities being carried out on
unregistered leased land/ rented land.
ELIGIBILITY: All individuals/ SHGs/ JLGs
NATURE OF FACILITY: Loan may be given in the form of Working Capital.
EXTENT OF LOAN: Need Based. However, the loan amount should be above Rs. 1.00 lakh.
Note: For SHGs/ JLGs the loan amount should be above Rs. 1.00 lakh per member.
SECURITY:
(A) Primary Security:
(i) Hypothecation of crops/ assets created out of bank loan

(B) Collateral Security:

(i) Immovable Property valued at 150% of amount of loan

OR
(ii) Charge/lien over liquid securities such as term deposits/NSC/KVP, etc. valued at 100% of
amount of loan.

Note: A combination of B(i) & B(ii) may be considered for collateral security.

It is to be ensured that Lease Deed/ Rent Agreement is for a period of 11 months and it contains
clause related to extension of lease/ rent for a further period of at least two terms of 11 months
each at the request of the lessee/ tenant and if he/she fails to submit request, he/ she is deemed to
have exercised option of extending the same.
25. SCHEME FOR FINANCING CULTIVATION OF PINEAPPLE IN NORTH EAST
(NE) REGION

ELIGIBILITY: All individuals, organizations, institutions including SHGs/ JLGs/ FPOs/ FPCs
eligible to be covered under Agriculture credit as per extant guidelines issued from time to time.

PURPOSE:
– Plantation of pineapple - This includes land development, planting material, initial fertilizer and
pesticide (organic/ inorganic), labour and other costs.
– Creation of irrigation facilities like installation of tubewell/ drip etc.
– Purchase of farm equipments
– Intercultural Operations, Fertilizer and plant protection cost during juvenile period.
– Construction of structures like pump house, labour room etc., if required.
NATURE OF FACILITY: Term Loan
EXTENT OF LOAN: Need Based
RATE OF INTEREST: As per chart given separately.
REPAYMENT: Maximum 4 years including gestation period of maximum upto 12 months.
MARGIN:
Loan Margin
Upto Rs. 1 lakh NIL
Above Rs. 1 lakh to Rs. 5 lakh 5%
Above Rs. 5 lakh 15%
SECURITY:
Loan Amount Security
Upto Rs. 1 lakh Hypothecation of crop/ assets created out of Bank loan.
Above Rs.1 lakh to Rs. 2 lakh Hypothecation of crop/ assets created out of Bank loan.
AND
Suitable third party guarantee
Above Rs. 2 lakh a) Hypothecation of crop/ assets created out of Bank
loan.
AND
b) Charge on land as per Agricultural Credit operations
and Miscellaneous Provisions Act of the State
concerned/Mortgage of agricultural land valued at 100% of
amount of loan for other farmers and 75% of the loan amount
for small farmers/marginal farmers.
 OR
Alternate security viz. charge/lien over liquid securities such as
term deposits/NSC/KVP, etc. which may be considered
adequate.
OR
Suitable third party guarantee

26. FARM MECHANISATION

PURPOSE :
 Purchase of New Tractors (of Approved Make & Model) & matching implements such as
cultivator, harrow, disc ploughs, trolleys, etc. (minimum three, unless borrower already
possesses the same.)
 New Power Tiller
 Second hand tractor
 Purchase of tractors, implements, power tillers, rice transplanters and other farm machinery
under the Sub- Mission on Agricultural Mechanization (SMAM) of Govt. of India. Under the
sub- mission subsidy is provided for tractors delivering upto 70 horse power at the Rear
Power Take off (PTO) shaft with matching implements, power tillers and farm
machinery like rice transplanters, reaper cum binder etc.
 Repair & renovation of tractor
 Purchase of agricultural machinery such as threshers, harvesters, seed drills, seed cum
fertilizer drills, harrows, hoes, sprayers, plant protection equipment, etc. Agricultural
machinery may be power/manual/tractor driven.
ELIGIBILITY:


Minimum 2.5 acres of perennially irrigated land for tractors or corresponding acreage as
prescribed for different categories of land under the State Land Ceiling Act.
 Min.1.5 acres for power tillers (owned singly or jointly).
 For repair & renovation, tractor should be more than 5 years old but not older than 12 years.
 For second hand tractor, it should not be more than 5 years old.
 Borrower to give undertaking that tractor will be driven by person holding valid driving
License.
EXTENT OF LOAN:

Need based, net of margin.

Repair & renovation of Tractor : Max. Rs. 1,00,000.
For second hand tractor – Max.Rs. 2 lakh

REPAYMENT:
 Tractor: 7 -9 years
 2nd hand tractor: 5 years
 Power tiller: 7 year.

 Other Farm machinery: 7 years ( small & marginal farmers),

5 years (other Farmers)
 Half yearly / yearly installments linked with harvesting & marketing of major crops,
 Gestation period: Max. 1 year for Small & Marginal Farmer and 6 months for others.
27. TRACTOR FINANCING WITHOUT MORTGAGE OF LAND

PURPOSE:
Purchase of new tractors with or without matching implements/equipments such as cultivators,
harrows, disc ploughs, trolleys, etc.

ELIGIBILITY:
(i) Individual farmers who own at least 2.5 acres of perennially irrigated land or
corresponding acreage as prescribed for different categories of land under the State Land Ceiling Act.
And
(ii) The farmer having no NPA record for last three years as on the date of application will be
eligible.
EXTENT OF LOAN: Need Based
MARGIN: Minimum 40% cash margin.
SECURITY:
PRIMARY: Hypothecation of assets created out of bank loan.
COLLATERAL: Third Party Guarantee(s) having adequate means.
Further, 4 PDCs (CTS-2010) are to be procured/ maintained by the branches to keep remedy alive
under Section-138 of Negotiable Instruments Act.

REPAYMENT: Maximum 5 years in form of monthly/ quarterly/ half yearly installments.

The Circle Heads under their discretionary powers may extend the repayment period on merits from
60 months to 72 months.
MORATORIUM PERIOD: No moratorium period is prescribed.
While the existing Scheme for tractor financing continues, this is an additional mode of financing
under the existing Scheme and all other guidelines of the scheme will remain unchanged.

28. SCHEME FOR FINANCING SELF-PROPELLED COMBINE HARVESTERS

PURPOSE:
Loan may be given for financing purchase of combine harvester to persons/ group of
farmers/individual farmers desirous of setting up of custom service units or for custom hiring, State
Agriculture Farms having larger area and intending to use the combines in their farm area apart from
such corporations which are engaged in land development activities.
ELIGIBILITY:
(i) In case of farmers:

Intending borrowers should be able to maintain and run combine harvester or should make suitable
arrangements for the same.

(ii) In case of persons other than farmers:

Intending borrowers should be technically qualified having adequate know-how, skill and managerial
ability to run custom service units.

(iii) In case of State Agriculture Farms/Corporations:

State Agriculture Farms/ Corporations engaged in land development activities should have adequate
resources and command area to run and maintain combine harvesters.
NATURE OF LOAN: Term loan.

EXTENT OF LOAN:
Need based. Cost of combine harvester should be verified to ensure that it is not inflated.
REPAYMENT OF LOAN:
5-7 years in half-yearly/ yearly instalments, depending upon income generation.
29. FINANCING TO CUSTOM HIRING/ SERVICE UNITS

PURPOSE:
Financing for setting up of custom hiring/ service units that maintain a fleet of tractors, bulldozers,
well- boring equipment, threshers, combines, harvesters, etc. and undertake work for farmers on
contract.
ELIGIBILITY:
All individuals, organizations, institutions eligible to be covered under Agriculture credit as per extant
guidelines issued from time to time.

NATURE OF FACILITY:
(i) Term loan
(ii) Working Capital

EXTENT OF LOAN:
Term Loan – Need based.
Working Capital – Need based. Subject to max. 50% of the projected receipts with a maximum of
66% of realizable value of mortgaged IP.

MARGIN:
Term loan – 25%
(However, in case the entrepreneur owns unencumbered other farm machineries like sugarcane
harvester/ planter/ seeder/ mulcher etc., the same will be treated as margin contribution. Value of such
existing machineries to be arrived at by charging depreciation @15% (7 years’ life) and 20% (5 years’
life) of the machinery).

REPAYMENT:
Term Loan – Maximum 7 years repayment period including gestation period (max. 1 year)
Working Capital shall be sanctioned for a period of one year and shall be subject to renewal/ review
annually.

30. FINANCING DAIRY DEVELOPMENT PROGRAMME

PURPOSE:
 Purchase & maintenance of milch animals for milk production (with average daily mild yield
of 6.5 litres)
 Construction of shed(s) for keeping the animals.
 Rearing of good quality female calves up to the stage of first lactation.
 Finance may also be granted for other innovative animal husbandry activities like cattle
breeding through artificial insemination, salvaging of dry pregnant cattles, financing milk
processing facilities (including milk chilling plants, pasteurization plants, transport
equipment, milk processing & storage facilities,etc.)
 Construction of milk houses by Village Milk Cooperative Societies, development of pastures
ELIGIBILITY :
 Individual borrower undertaking dairy as a subsidiary activity (landless agricultural labourer
or farmer) having experience & arrangement for supply of adequate quantity of fodder and
accommodation for keeping the animals.
  Individual borrowers undertaking dairying as main activity should be well experienced in
running a dairy farm on commercial basis & should have accommodation for construction of
sheds, arrangement for growing storage of fodder concentrates.

EXTENT OF LOAN: Need based

A unit of 2 milch animals is considered viable size; cost of animals should be in conformity with the
unit cost.
REPAYMENT:
5 years in monthly/ quarterly instalments, linked with lactation period.
30 months moratorium for Cross -bred calf rearing.

31. PNB DUGDH VIKAS YOJANA

PURPOSE:
i.
Financing for purchase of good quality milch cattle, working capital, construction of shed
etc.
ii. Financing for setting up of milk collection centres.
TARGET GROUP:
i. The scheme is targeted at those small producers who are linked with milk societies/ co-
operatives or private sector companies and supplying their surplus milk to them at village
level.

ii. The scheme also aims at facilitating opening of milk collection centres at village level.
ELIGIBILITY:
(i) For purchase of cattle:
(a) Individuals, SHGs, JLGS.
(b) The milk producer should be a member of village level milk society of Co-operative
Milk Union or private dairy company.
(ii) For setting up of milk collection centre:
(a) Individuals/ SHGs/ JLGs/ / Milk Societies
NATURE OF FACILITY: Term Loan and/or Working Capital
EXTENT OF LOAN:
(i) For purchase of cattle, working capital, construction of shed etc.: Need based.
(ii) For collection centre: Need based.

MARGIN: As per extant bank guidelines

SECURITY: As per extant bank guidelines.
32. PNB DAIRY VIKAS CARD SCHEME

PURPOSE:

Purchase of good quality high milk yielding cows/buffaloes or exotic cross bred cows, construction of
shed, working capital items like dairy feed, veterinary medicines, fodder, dairy machinery or other
equipments.
ELIGIBILITY:
Landless agricultural. labourer or farmers /individuals having experience in maintaining milch
animals.
The applicant should have shed/ accommodation for keeping the animals or should have adequate
space for constructing the shed for keeping the animals as also arrangement for supply of adequate
quantity of fodder.
MARGIN: NIL
EXTENT OF LOAN: Composite CC Limit- Rs. 1 lac
Production/ Investment Credit:-Need based. Max. Rs.1.00 lakh
SECURITY VERIFICATION:
For Investment Credit: Verification of assets financed out of investment component shall be done
by the Bank Officer/ Branch Manager within a month of disbursement of loan.
For Production Credit:
 No stock report to be obtained from the borrower.
 Stock/ animals to be physically verified by Bank Officer/ Branch Manager once in 6 months.
REPAYMENT:
Investment credit repayable in 5 years with reducing composite CC Limit on yearly basis (Drawing
Power to be calculated on annual basis)

33. POULTRY FARMING

PURPOSE :

Investment Credit for construction of sheds and purchase of equipment and production credit for
purchase of day old chicks, feed, medicines etc.

ELIGIBILITY :
For subsidiary activity:
Small farmer, landless Agri. labourer or other person who is under employed and intends to
supplement his income and having required land / shed to establish poultry farms.
For main activity:
Well experienced in running poultry unit on commercial basis as main vocation & having required
land/shed to establish poultry farm
EXTENT OF LOAN: Need based
Minimum 500 birds for subsidiary activity.
Size for main activity as per techno-economic appraisal of the project
(Requirement for investment and production credit will be considered as a package)

REPAYMENT :
Production Credit: Maximum 18/12 months with a gestation period of 6/3 months in case of layers &
broilers respectively.
Investment Credit: 6-7 years (with gestation period of 12 months for layers & up to 3 months for
broilers)
INSURANCE:
Under following conditions insurance of birds can be waived:
(i) Waivement of insurance of birds to be allowed by the Circle Head on case to case basis after
satisfying himself / herself of the risk bearing ability and repaying capacity of the applicant
entrepreneurs.
(ii) Collateral Security (realisable value) of minimum of 100 per cent of the loan amount to be
obtained.
(iii) Units having regular veterinary back-up only to be allowed waivement of insurance of birds,
whereas other fixed assets like building, feeding material and other connected assets, etc, shall
be insured as per extant Bank guidelines.
34. FISHERY DEVELOPMENT
PURPOSE:
Development Of Inland & Brackish Water Fisheries For;-
 Construction /renovation of ponds /tanks
 Construction of sluices.
 Purchase of fish, Prawn, fry & fingerlings/fish seed/ prawn seed etc.
 Purchase of inputs like oil cake fertilizer, organic fertilizer & other feed material up to first
harvest.
 Purchase of nets,boxes, baskets, ropes, shovels, hooks/ other accessories
  In case of reservoir or lake fisheries, purchase of country made boats may be considered.

Marine Fisheries:
For purchase of mechanized /non-mechanised boats/deep sea fishing vessels /trawlers
Purchase of nets, deck equipment, marine engine & Working capital.
ELIGIBILITY:

Development of inland & brackish water fisheries for;-

 Individual farmers/ groups and cooperative society/ company or association of persons having
adequate knowhow, experience/ training in the activity and infrastructural facilities.
 Owner(s) of the pond or land or have lease hold rights till completion of the project.
 Having fishing rights in the case of lake/ reservoir.
 Report on quality of water should be submitted by borrower along with the application for
agriculture credit

For Marine Fisheries:

 Individuals/ partnership firms/ Limited companies who are technically qualified & are having
adequate experience to undertake such ventures.
 In case of Deep sea fishing vessels, necessary permission from Govt. authorities is required for
operating in the maritime zone.

EXTENT OF LOAN: Need based

If necessary, in Inland fisheries projects may be got verified from Fish farmer Development Agency
(FFDA), State Fishery Department /NABARD consultancy services limited.
REPAYMENT:
Pond fish culture:- 5-8 years (Including gestation period of 12 months with yearly mode of
repayment)
Brackish water fish/prawn culture : 5-10 years including gestation period of 12 months with half-
yearly mode of repayment..
If sponsored by FFDA: 9 years ( with 2 years repayment holiday) in pond culture.
Non-Mechanised Boats/vessels: 6-7 years with 4 months’ grace period each year.
Mechanised Boats: 8-12 years, with 4 months’ grace period each year.

35. SCHEME FOR SHEEP AND GOAT BREEDING/REARING

PURPOSE:
For purchase of sheep/goats of recognised breed for the purpose of breeding and/or rearing them for
wool, meat and milk production, equipments / tools, feed, construction of sheds.
ELIGIBILITY:
Small & marginal farmers / agricultural labourers desirous of undertaking sheep/ goat breeding
/rearing as subsidiary activity or trained persons desirous of taking up the venture on commercial
lines.
EXTENT OF LOAN:
Need based.
Unit size 1:20 (male :female in case of sheep) & 1:4 (male :female in case of goats)
REPAYMENT:
Medium term Loans:
5 to 6 years ( including gestation period of 12 months)
36. SCHEME FOR PIGGERY DEVELOPMENT
PURPOSE:For breeding as well as rearing of pigs including cost of exotic breed of boars and sows of

improved breeds, weaned piglet( 1-2 months old), feed & medicine, equipments, construction of

house, fencing, electricity, etc.

Healthy pigs in the age group of 1.5 to 2 years to be financed.

ELIGIBILITY:
 Farmers & agricultural labourers and other entrepreneurs for setting up units as subsidiary/main
activities.
 State animal husbandry deptt. may be consulted about quality of pigs and size of the Unit.

EXTENT OF LOAN:

 Need based & according to the unit cost approved by state unit cost committee.
 Usual unit size comprises 1 boar and 3 sows.
 Purchase of feed and medicine for a period not exceeding 9 months
REPAYMENT:
For Production Credit:- Maximum period of one and half years.
For Investment Credit: 5 to 6 years (including gestation period of one year)

37. SCHEME FOR APICULTURE (BEE- KEEPING)

PURPOSE :
For construction of honey houses, purchase of colonies, equipments such as boxes, honey extractors,
smokers and bee veil, foundation sheets, gloves, sugar, etc.
ELIGIBILITY :
Small/marginal farmers/agricultural labourer individual/ association of persons/ companies who
possess adequate experience in bee keeping (minimum unit of 10 bee hives).
EXTENT OF LOAN:
 Need based. as per the unit cost approved by the KVIC, NABARD or state govt.
 Extent of finance would depend on the size of the unit, number of bee colonies, cost of
equipments and comb foundation sheets etc.
REPAYMENT :
5 years ( including gestation period of 12 months)

38. SCHEME FOR FINANCING SERICULTURE

PURPOSE:

For Cultivation of mulberry, Rearing of silkworm and non-farm activities related to sericulture
ELIGIBILITY:

Individual farmers, SHGs, firms, companies engaged in sericulture activity.

EXTENT OF LOAN: Need based.

REPAYMENT:
4 – 9 years including grace period depending upon the nature of activity financed.

39. SCHEME FOR PURCHASE OF ANIMAL DRAWN VEHICLES, I.E, DRAFT

ANIMAL/ CARTS
PURPOSE :For purchase of draft animals/animal driven cart for transport of agriculture inputs and

produce (only young and healthy animals of 2-6 years of age to be financed).

ELIGIBILITY:
Farmers owning minimum 2 acres of land or having perpetual right of cultivation of minimum 2
acres of land. No stipulation of land holding for landless labourer or if the case is sponsored by
DRDA.
EXTENT OF LOAN:
Need based keeping in view the unit cost approved by NABARD and repaying capacity of the
borrower.

REPAYMENT:
Bullocks only- 4 years,
He buffaloes and drawn cart ( Jhota Bhuggies) : 4-5 years
Camel only : 5 years
Bullock cart /Camel & carts : 5-7 years

40. SCHEME FOR FINANCING UNDER PNB KISAN CREDIT CARD (KCC)

ELIGIBILITY: All Farmers – Individuals / Joint borrowers who are owner cultivators, Tenant
Farmers, Oral Lessees & Share Croppers, SHGs or Joint Liability Groups of Farmers including tenant
farmers, share croppers, etc,.

PURPOSE OF THE LIMIT: Kisan Credit Card Scheme aims at providing adequate and timely
credit support from the banking system under a single window to the farmers for their cultivation &
other needs as indicated below:
a. To meet the short term credit requirements for cultivation of crops
b. Post harvest expenses
c. Produce Marketing loan
d. Consumption requirements of farmer household
e. Working capital for maintenance of farm assets and activities allied to agriculture, like dairy
animals, inland fishery etc.
f. Investment credit requirement for agriculture and allied activities like pumpsets, sprayers,
dairy animals etc.

EXTENT OF LIMIT: Maximum Rs.50 lakh.

FIXATION OF LIMIT: The credit limit under the Kisan Credit Card may be fixed as under:

The short term limit to be arrived for the first year: Scale of finance for the crops (as decided by
District Level Technical Committee) x Extent of area cultivated + 10% of limit towards post-harvest /
household / consumption requirements (the premium for health insurance cover may also be covered
with a maximum coverage of upto Rs. 3 lakh) + 20% of limit towards repairs and maintenance
expenses of farm assets + crop insurance, PAIS/ PMSBY & asset insurance.
Limit for second & subsequent year :First year limit for crop cultivation purpose arrived at as above
plus 10% of the limit towards cost escalation / increase in scale of finance for every successive year (
2nd , 3rd, 4th and 5th year) and estimated Term loan component for investments towards land
development, minor irrigation, purchase of farm equipments and allied agricultural activities for five
years.
Maximum Permissible Limit: The short term loan limit arrived for the 5th year plus the estimated
long term loan requirement will be the Maximum Permissible Limit (MPL) and treated as the Kisan
Credit Card Limit.

DISBURSEMENT: The short term component of the KCC limit is in the nature of revolving cash
credit facility. There should be no restriction in number of debits and credits. The farmers could draw
the funds using any of the following delivery channels:
a. Operations through branch
b. Operations using Cheque facility
c. Withdrawal through ATM / Debit cards / PNB Rupay Kisan Card
d. Operations through Business Correspondents and ultra small branches
e. Operation through PoS available in Sugar Mills/ Contract farming companies, etc., especially
for tie-up advances
f. Operations through PoS available with input dealers
g. Mobile based transfer transactions at agricultural input dealers and mandies.

MARGIN:
Production credit: Nil
Term Loan:
Amount of loan Margin

(i) Upto Rs.1 lakh Nil

(ii) Above Rs.1 lakh to Rs.2 lakh 5%
(iii) Above Rs.2 lakh to Rs.5 lakh 10%
(iv) Above Rs.5 lakh 25%

SECURITY:

I. For Cards issued upto Rs.1, 00,000/-

Hypothecation of crops/assets created out of bank loan.
II. For cards issued above Rs.1, 00,000/-
(i) Hypothecation of crops/assets created out of bank loan.

AND
(ii) Charge on agricultural land valued at 75% of the loan amount for small farmers /marginal
farmers and 100% of amount of loan for other farmers,

OR
Alternate Security, viz., charge/lien over liquid securities such as term deposits/NSC/KVP,
land and building situated outside village, etc., which may be considered adequate.
OR

Suitable third party guarantee.

RATE OF INTEREST:
Interest is 7% p.a. for loan upto Rs. 3 lakh. For prompt paying farmers, interest is 4%.
For loan above Rs 3 lakh as per IRMD L&A Cir. No. 48/14 dated 23.04.2014
No processing charges upto loan of Rs 3 Lakh.

VALIDITY OF THE CARD: The card is valid for a period of 5 years, subject to an annual review.

COVERAGE UNDER PRADHAN MANTRI SURAKSHA BIMA YOJANA:

This Policy covers the KCC holders aged between 18 years (completed) and 70 years (age nearer
birthday) who give their consent to join / enable auto-debit, as per the above modality, will be
enrolled into the scheme.
RISK COVERAGE:
Particulars Sum Insured
a. Death Rs. 2 lakh
b. Total and irrecoverable loss of both eyes or loss of use Rs. 2 lakh
of both hands or feet or loss of sight of one eye and
loss of use of hand or foot
c. Total and irrecoverable loss of sight of one eye or loss Rs. 1 lakh
of use of one hand or foot

PREMIUM: Rs.12/- per annum per member. The premium will be deducted from the account
holder’s KCC account through ‘auto debit’ facility in one installment on or before 1st June of each
annual coverage period under the scheme. However, in cases where auto debit takes place after 1st
June, the cover shall commence from the first day of the month following the auto debit.
COVERAGE UNDER NATIONAL CROP INSURANCE PROGRAMME/ PRADHAN
MANTRI FASAL BIMA YOJANA:
To provide insurance coverage to the farmers in the event of failure of any of the notified crop as a
result of natural calamities, pests & diseases.
As per provisions “in case, a farmer is deprived of any benefit under the Scheme due to
error/omissions / commissions of the Nodal bank/ branch, the concerned Institution only shall
make good of all such losses.”

Branches to ensure compulsory coverage of notified crops of the loanee farmers under the
programme. The crop insurance premium should also be invariably accepted from the non-loanee
farmers who opt for the Scheme.

41. KISAN GOLD SCHEME

PURPOSE:
 Production & investment credit for agriculture & allied activities
 Rural housing related activities
 Consumption needs (i.e. for marriage, education, religious/family functions)

ELIGIBILITY :
I. Only existing good agricultural land owner borrowers who have been continuously availing of
any loan and having no NPA record for last Two years as on the date of application will be
eligible. New farmers with evidence of satisfactory dealing with other banks for a minimum
period of 2 years will also be eligible. If the land mortgaged is in the name of more than one
farmer then all will be eligible jointly/ individually (subject to obtaining of declaration stating
that there is no family dispute about title of the agricultural land to be mortgaged/ charge created
in favour of the Bank for securing the loan.

II. The above condition of track record of 2 years may be relaxed in case of new farmers having
good amount of deposit for the last 2 years provided:

Loan is secured by 100 % liquid collateral security like Deposit/ NSCs, etc,
or
Loan is secured by 50 % liquid collateral security and 50% by mortgage of land (valued at 50 %
of Bank Loan for Small/ Marginal farmers and 75% of Bank Loan for other farmers)

For housing, required approval from competent authority for plan, etc., will have to be obtained.
Other requirements of Bank’s Housing Loan Scheme are to be fulfilled.
Max. age limit for rural housing at the time of application is 60 years (up to 65 years , if legal heirs
stand as guarantor).
EXTENT OF LOAN:

Maximum: Rs 50 lakh. Minimum 75% of the limit for Productive Purposes. 25% of the loan amount
or Rs. 5 lakh whichever is lower be given for non-productive purpose which may comprise of Rs 3
lakh for Rural Housing and maximum of Rs 2 Lakh for consumption.
Lower of:-
 5 times average annual (2 Years) total income of the borrower.
 50% of value of mortgaged land.

REPAYMENT:

Production Credit:
Cash Credit Limit: Aggregate credit (last 12/ 18 months ) should be equal to outstanding.
Working Capital for allied activities: 12 months
No drawal to outstand for more than 12 months (18 months for long duration crops)
Housing: 9 years (with gestation of 12 months)
Main Agricultural activity: upto maximum of 9 years.
Allied Agrl. Activity: upto maximum of 7 years.
42. PNB KRISHI BHU-SWAMI YOJANA (PNB Agri-Land Purchase Scheme)

The scheme aims at providing term loan to small/marginal farmers including share croppers/tenant
cultivators to purchase agricultural land as well as fallow and wasteland to develop and cultivate it with
a view to increasing production/ productivity
EXTENT OF LOAN: Rs. 20 lakh

The Extent of loan will depend upon (i) valuation as assessed by the Branch (ii) Guidance
value/Circle rate fixed by the State or (iii) the Registration Value whichever is lower, plus value of
stamp duty, registration charges for sale / mortgage deed.

ELIGIBILITY:
Small and marginal farmers/ Share croppers/tenant farmers/ Entrepreneurs with agricultural
background. The total land holding of the borrower after the purchase of the land under the scheme
should not exceed 2.5 acres of irrigated land or 5 acres of non irrigated land or equivalent.
SECURITY NORMS:
Following will form the security for the loan:

 The land presently owned, if any and also the land to be purchased out of the bank finance to be
mortgaged in favour of the Bank.
 Hypothecation of Crops grown from time to time on the land.

REPAYMENT :
7-12 years in half yearly/ yearly instalments including maximum moratorium period of 24 months.
Note: Applicant farmers may be allowed to purchase agriculture land within a radius of 15 kms from
the existing land owned by him/her or from the residence or within the service area villages
whichever is higher.
43. PNB KRISHAK SAATHI SCHEME (PNBKSS)

PURPOSE :

Providing finance to the farmers to redeem their outstanding dues to moneylenders.

ELIGIBILITY:

All farmers including small & marginal farmers, tenant farmers, oral lessees, sharecroppers,
agriculture labourers, etc., who are indebted to non-institutional money sources. The requirement of
obtaining a certificate of moneylender discharging the borrower from total liability has been
dispensed with.

EXTENT OF LOAN: Need Based Credit; Maximum Rs.1,00,000/- as term loan.

REPAYMENT :

The loan shall be repaid by the farmers in 5-7 years including a maximum moratorium period of 12
months with half-yearly/yearly instalments.

44. MINOR IRRIGATION

PURPOSE:
Purchase of pumpsets, Deepening of wells /repairs to wells, borewell, shallow tubewell, sprinkler
sets/drip irrigation sets/solar pumps / wind mills/ lift irrigation / generator sets for energisation of
pumpsets, etc..
ELIGIBILITY:

Minimum 1 acre of agricultural Land

(this condition does not apply for projects sponsored by DRDA, SGSY, State Development Agency)
Projects is being set up in white area & is technically feasible / economically viable
Minimum distance criteria of at least 200 sq. yards between tube wells.

EXTENT OF LOAN : Need based

(Prices /Invoices must be according to price list issued by manufacturer or rate contract of State Govt.
Concerned or unit cost approved by NABARD/Bank
REPAYMENT :
Pumpsets: 9 Years
Deepening of wells /Persian wheels/Rahat: 5 years
Linking of Water course /Field Channels : 9-15 years
Sprinkler/Drip Irrigation: 10-15 years
Filter point and pump set, shallow tube wells, bore well, dug well with or without pumpset, lift
irrigation and on farm development (OFD) Under Command Area Development (CAD) – 11-15
years
GESTATION PERIOD: Pumpset: 12 months,
OFD : 24 months,
Lift Irrigation :36 months
Others : Max.1 year

45. SCHEME FOR FORESTRY DEVELOPMENT

PURPOSE:
 Development of nurseries, Plantation and raising of forestry trees including cost of development
of land, plantation/ digging of pits/raising bunds, creation of irrigation facilities, purchase of farm
equipments, fertilizers, pesticides, seedlings, labour charges, etc.
 Loan for inter cropping

ELIGIBILITY :
 Farmers/SHG/JLG/ Companies/State Undertakings having ownership or lease hold/perpetual
tenancy right over the land.

The land proposed for raising forest plantation should be Marginally degraded/ waste lands.

EXTENT OF LOAN: Need based.

REPAYMENT:

Forest plantation: Loan for scheme where trees are grown should be repaid with in maximum period
of 15 years including grace period of maximum 6 years.
Nursery: Short term loan as per KCC Scheme.

46. SCHEME FOR FINANCING DEVELOPMENT OF WASTELAND

PURPOSE:
 Reclamation of soil, soil conservation, conditioning of land, raising of forest trees/ pastures in
existing wasteland or reclaimed land, creation of irrigation potential, schematic afforestation of
waste land
 Financing to tree patta holders under Tree patta scheme,
 Loan for development of non-forest wasteland under the investment promotion scheme,
 Setting up of nurseries, etc.
ELIGIBILITY :
 Individual farmers having land holding (either as owners or on the basis of long term tenancy
/lease hold rights), which are degraded due to soil salinity, alkalinity, water erosion etc.
 Panchayats/other bodies having such community land.
Deptt. of wasteland development provides subsidy ranging from 25% to 50% for on-farm activities.

EXTENT OF LOAN: Need based.

Project report for reclamation/conservation of soil to be verified by soil conservation Officer

/Agricultural University/Krishi Vigyan Kendra/ Agriculture deptt. /forest department.

Margin Money Assistance Scheme: National Wasteland development Board provides margin money

up to 25% of project cost to eligible organisations for bankable projects.

REPAYMENT :
5- 15 years.
(Gestation period may be up to 36 months)

47. PNB SONA KRISHI RIN YOJANA (PNB GOLD AGRI- LOAN SCHEME)

To enable farmers to quickly meet their short-term agricultural credit needs and investment needs.
ELIGIBILITY:

Any person engaged in agriculture or allied activities as well as persons engaged in activities
permitted by GOI / RBI to be classified under agriculture. Loan will be given based on declaration.
Additionally, proof, of pursuing the activity to be given for loans above Rs. 1 lakh.

NATURE OF LOAN:

a. Short term Production Credit

The same may be granted as a Cash Credit / Overdraft or single transaction-Demand Loan with one
year tenor Where the KCC facility has been allowed, the guidelines applicable for KCC Scheme are to
be followed.

b. Term loan-Upto 36-60 months depending on the purpose.

MARGIN: CC/Short Term Loan - 5%, Term Loan - 20%

(Note: This margin will be on the rates advised by RAD from time to time. However, the account may
be reviewed annually to ensure availability of sufficient margin as stipulated above.

REPAYMENT OF LOAN:

Cash Credit / Overdraft: An operative limit/ cash credit account for a period of 5 years (on the lines
of revised KCC Scheme) subject to annual review.

Demand Loan - Repayment should be fixed based on the income generation coinciding with harvest
and the marketing time, total period not exceeding 18 months.

Term Loan: The repayment period of the loan should be fixed in line with the Term loan purpose but
not exceeding 5 years, coinciding with the harvesting and marketing season / generation of income
from the activity.
48. BIO-GAS DEVELOPMENT

PURPOSE:

 For construction of biogas plant with sanitary latrines in rural areas.

 Biogas plants of 1 cubic meter capacity can be operated with dung collected from one or two adult
cattle heads and attachment of a latrine complex serviceable for 5 to 10 persons.

ELIGIBILITY:
Intending borrower should have adequate number of cattle commensurate with size of plant proposed
to be set up. Since there is no apparent income from the activity, except saving in cost of fuel,
eligibility should be linked with his income to repay from other sources, should be sponsored by
KVIC, state Agro. Industrial Corporation or other concerned department of state.
EXTENT OF LOAN: Need based.
State Govt. have budgetary provisions under State plan sector for providing subsidy and other
facilities for construction of sanitary latrines in rural areas.
REPAYMENT :
Bio-gas plants up to 5 cub. meter capacity : 7 years
Bio-gas plants above 5 cub. meter capacity : 5 years

49. PNB KISAN TATKAL CARD YOJANA

An instant credit for farming community to meet the emergency requirements for Agriculture and

Domestic purposes for tiding over temporary difficulties.

 Individual farmers /joint borrowers (not exceeding four farmers) who are existing Kisan Credit
Card (KCC) holders having satisfactory track record of at least two years are eligible.
 Credit facility may be provided as a reducing Cash Credit Limit.
 Limit upto Rs 25,000/- may be repayable in 3 years and the limit above Rs.25,000/- may be
repayable in 5 years.
 Quantum of loan/Ceiling: Minimum limit: Rs. 1000/Maximum limit: Rs.50000/- (Subject to
ceiling at 50% of KCC limit/ 25% of annual income)

SECURITY: Existing security/ies obtained for KCC to be continued.

No additional securities to be obtained even if the combined exposure (KCC plus proposed Kisan
Tatkal Scheme) exceeds the present cut-off ceiling of Rs.1 lakh.

50. PNB SAUR URJA YOJANA (PNB SOLAR ENERGY SCHEME)

Financing Farmers for Purchase of Solar Home Lighting/Solar Water Heaters System.

PURPOSE: To purchase Solar Home Lighting /Solar Water Heating System.

QUANTUM OF LOAN: Maximum Rs 50,000/-

MARGIN: 15%

ELIGIBILITY: Small Farmers/ Marginal Farmers/Share cropper/Tenant farmers/Other Farmers and

agri-entrepreneurs, will be eligible under the scheme.
REPAYMENT OF LOAN: 5 years in yearly/half yearly instalment.
51. FINANCING TO DISTRIBUTORS OF AGRICULTURE INPUTS

PURPOSE:
Financing of stock not older than 6 months and book debts not older than 3 months.

ELIGIBILITY:
All stockists and distributors who are involved in distribution of agriculture inputs of reputed
manufacturing companies.

EXTENT OF LOAN:
Need based, subject to maximum limit eligible to be classified under Priority Sector – Agriculture –
Indirect Advances (At present Rs. 5 crore).

In case, working capital limit is sanctioned by way of hypothecation of stocks and book debts; limit
against book debts shall not exceed 50% of the total limit sanctioned.

In case the working capital limit is sanctioned only against hypothecation of book debts then the
maximum limit shall be Rs. 2.50 crore only.

MARGIN:
Against stock – 20% and against Book Debts – 30%

RATE OF INTEREST: As per chart given separately.

REPAYMENT:
Cash Credit limit shall be sanctioned for a period of one year and shall be subject to renewal/ review
annually.

52. FINANCING TO DEALERS/ SELLERS OF AGRICULTURE INPUTS

PURPOSE:
Financing of stock not older than 6 months and book debts not older than 4 months.

ELIGIBILITY:
The dealers/ sellers, who are involved in sale of agriculture inputs like fertilizers, pesticides, seeds,
cattle feed, poultry feed, agriculture implements and other inputs.

EXTENT OF LOAN:
Need based, subject to maximum limit eligible to be classified under Priority Sector – Agriculture –
Indirect Advances (At present Rs. 5 crore).

In case, working capital limit is sanctioned by way of hypothecation of stocks and book debts; limit
against book debts shall not exceed 50% of the total limit sanctioned.

In case the working capital limit is sanctioned only against hypothecation of book debts then the
maximum limit shall be Rs. 2.50 crore only.

MARGIN:
Against stock – 20% and against Book Debts – 30%

RATE OF INTEREST: As per chart given separately

REPAYMENT:
Cash Credit limit shall be sanctioned for a period of one year and shall be subject to renewal/ review
annually.
53. PNB DEALER SUVIDHA

Scheme for financing dealers engaged in sale of agriculture implements.

PURPOSE: Dealers of agriculture implements can also be financed for:

(i) For sale purpose activity
(ii) For custom hiring services

TYPE AND EXTENT OF LOAN –

For sale purpose activity - Cash Credit (max. Rs. 5 crore) as per Circular No. PSLB/ABC/ 25/2013
dated 19.7.2013).
For custom hiring service activity – T/L (Margin-25%, 10% for existing dealers availing credit
facilities from the Bank and having satisfactory conduct of account/s)) and working capital (need
based) as per Circular No. PSLB/ABC/ 40/2013 dated 28.8.2013).
Advances will be classified as Agriculture - Indirect

54. SCHEME FOR FINANCING TO FARMERS GROWING SUGARCANE CROP

UNDER TIE UP ARRANGEMENT WITH SUGAR MILLS

Eligible borrowers: Farmers in the command area / cane area of the Sugar Mill.

Role of Sugar Mill: Sourcing of loan applications of the farmers in its cane area to our Bank.

Extent of Loan (based on scale of finance): Need based, subject to maximum (at present Rs. 20
Lakh) as per extant guidelines under KCC scheme.

KYC norms: 100% Compliance of KYC guidelines to be ensured by the financing branch strictly as
per Bank guidelines and pre sanction appraisal to be done as per guidelines under KCC scheme.

Bank will sign a Memorandum of Understanding (MoU) with Sugar Mills and Tripartite Agreement
with Sugar Mill and Farmers.

55. SCHEME FOR PROVIDING PRIORITY SECTOR CREDIT AGAINST BANK

DEPOSIT, NATIONAL SAVINGS CERTIFICATES AND KISAN VIKAS PATRA

PURPOSE: For undertaking priority sector activity/ies viz, agriculture, MSE, etc.
NATURE AND PURPOSE OF ADVANCE:
Loan may be allowed by way of demand loan/overdraft for productive purpose and for meeting the
contingencies.
EXTENT OF LOAN: Need based depending upon the activity financed and stipulated margin.
56. DIFFERENTIAL RATE OF INTEREST (DRI) SCHEME

OBJECTIVE: To improve the economic conditions of the weakest of the weaker sections of
community by providing financial assistance at concessional rate of interest for engaging in
productive and gainful activities.
TARGETS:
At least 2/3 of the DRI advances should be granted through rural and semi-urban branches.
It should be ensured that at least 40 percent of the total advances granted under DRI scheme go to
eligible borrowers belonging to SC/ST category.
ELIGIBILITY NORMS:
a) Land-Holding Norms
1) Persons not owning any land or
2) The size of land holding does not exceed one acre in case of irrigated land and 2.5 acres in case of
un-irrigated land.
However, the members of SC/ST category are eligible for the loan, irrespective of land holding,
provided they satisfy the other eligibility criteria.

b) Income Criteria
Family income of the borrower from all sources does not exceed Rs.18000/- p.a. in rural areas and
Rs.24000/- p.a. in urban and semi- urban areas.

Note:
 The beneficiary largely works on his own and with such help as other members of his family.
 The beneficiary should not have another source of finance while DRI loan exists.
Margin: NIL
SECURITY:
Assets purchased with bank loan may be hypothecated to the bank
No collateral security or third party guarantee to be asked
RATE OF INTEREST: 4% p.a.

57. FINANCING AGRICULTURAL GRADUATES FOR SETTING UP OF AGRI-

CLINICS AGRI- BUSINESS CENTRES

PURPOSE:
For setting up of:-
- Agri-clinics to provide expert advice and services to farmers
- Agri.-business centres to provide input supply, farm equipment on hire and other services.

ELIGIBILITY:

(i) Graduates in agriculture and allied subjects from State Agricultural Universities
(SAU)s/Central Agricultural Universities/ Universities recognized by ICAR/UGC. Degree
holders in Agriculture and allied subjects offered by other agencies are also eligible subject to
approval of Department of Agriculture & Cooperation, Government of India on
recommendation of the State Government.

(ii) Diploma (with at least 50% marks) / Post Graduate Diploma holders in Agriculture and allied
subjects from State Agricultural Universities, State Agriculture and Allied Departments and
State Department of Technical Education. Diploma holders in Agriculture and allied subjects
offered by other agencies are also eligible subject to approval of Department of Agriculture &
Cooperation, Government of India on recommendation of the State Government.

(iii) Biological Science Graduates with Post Graduation in Agriculture & allied subjects.

(iv) Degree holders in courses recognized by UGC having more than 60 percent of the course
content in Agriculture and allied subjects.

(v) Diploma/Post-graduate Diploma holders in courses with more than 60 percent of course
content in Agriculture and allied subjects, after B.Sc. with Biological Sciences, from
recognized colleges and universities.
(vi) Agriculture related courses at intermediate (i.e. plus two) level, with at least 55% marks.

EXTENT OF LOAN: Need based depending on financial viability and technical feasibility.
PROJECT COST CEILING FOR SUBSIDY: Ceiling for project cost for subsidy is as under:
(i) Project by Individual : Rs.20 lakh (Rs 25 lakh in case of
extremely successful individual projects)
(ii) Project in Group : Rs.100 lakh
(Minimum of Five Individuals)

REPAYMENT :
Repayable in monthly /quarterly, half yearly or yearly instalments depending upon income generation
from project ( as prescribed in respective credit schemes)
*Credit linked composite subsidy @ 36% of capital cost of project funded through Bank Loan (44%
for women, SC/ST, Other disadvantaged sections/N E & Hilly states.
58. CAPITAL INVESTMENT SUBSIDY SCHEME FOR COMMERCIAL PRODUCTION
UNITS OF ORGANIC INPUTS UNDER NATIONAL PROJECT ON ORGANIC FARMING

OBJECTIVES:
To promote organic farming in the country by making available the organic inputs such as
biofertilisers, Biopesticides and fruit & vegetable market waste compost and thereby better return for
the produce.
2.2 To increase the agricultural productivity while maintaining the soil health and environmental
safety.
2.3 To reduce the total dependence on chemical fertilizers and pesticides by increasing the
availability and improving the quality of biofertilizers, biopesticides and composts in the country.
2.4 To convert the organic waste in to plant nutrient resources.
2.5 To prevent pollution and environment degradation by proper conversion and utilization of
organic waste.

PURPOSE:
1. For financing Biofertilisers and Biopesticides production Unit
2. For financing Fruit & Vegetable Waste Compost Unit

ELIGIBLE ORGANIZATIONS:

Biofertilisers and Biopesticides production Fruit & Vegetable Waste Compost Unit
Unit
Individuals, group of farmers/growers, APMCs, Municipalities, NGOs and Private
proprietary, and partnership firms, Co-operatives, entrepreneurs.
Fertilizer industry, Companies, Corporations,
NGOs

QUANTUM OF SUBSIDY
The scheme provides credit linked and back-ended capital investment subsidy @ as described below.

Biofertilisers and Biopesticides production Fruit & Vegetable Waste Compost Unit
Unit
25% of total financial outlay subject to the 33% of total financial outlay subject to the
maximum of Rs 40 lakh per unit, whichever is maximum of Rs. 63 lakh per unit, whichever is
less. less.
59. DAIRY ENTREPRENEURSHIP DEVELOPMENT SCHEME (DEDS) – NABARD

OBJECTIVE:
 To promote setting up of modern dairy farms for production of clean milk
 To encourage heifer calf rearing thereby conserve good breeding stock
 To bring structural changes in the unorganized sector so that initial processing of milk can be
taken up at the village level itself.
 To bring about upgradation of quality and traditional technology to handle milk on a
commercial scale
 To generate self employment and provide infrastructure mainly for unorganized
sector.

ELIGIBILITY:
(i) Farmers, individual entrepreneurs, NGOs, companies, groups of unorganized and organized
sector etc. Groups of organized sector include self help groups, dairy cooperative societies, milk
unions, milk federations etc.

(ii) An individual will be eligible to avail assistance for all the components under the scheme but
only once for each component.

(iii) More than one member of a family can be assisted under the scheme provided they set up
separate units with separate infrastructure at different locations. The distance between the boundaries
of two such farms should be at least 500m.

SUBSIDY:

S.N Component Unit Cost Pattern of Assistance

o
i Establishment of small dairy units Rs 6.00 lakh for 10 25% of the outlay (33 .33 % for SC / ST
with crossbred cows/ indigenous animal unit – minimum farmers, ) as back ended capital subsidy
descript milch cows like Sahiwal, unit size is 2 animals subject to a ceiling of Rs 15,000 per
Red Sindhi, Gir, Rathi etc / graded with an upper limit of animal for 10 animals (Rs 20,000 for
buffaloes upto 10 animals 10 animals. SC/ST farmers,) or actual whichever is
lower. Beneficiaries may purchase
animals of higher costs; however, the
subsidy will be restricted to the above
ceiling.
ii Rearing of heifer calves – cross Rs 5.30 lakh for 20 calf 25% of the outlay (33.33 % for SC / ST
bred, indigenous descript milch unit –with an upper farmers) as back ended capital subsidy.
breeds of cattle and of graded limit of 20 calves. Subsidy shall be restricted on prorata
buffaloes – upto 20 calves basis to a maximum of 20 calf unit
subject to a ceiling of Rs. 6,600 per calf,
(Rs. 8,800 for SC/ ST farmers) or actual
whichever is lower.
iii Vericompost (with milch animal Rs 22,000/- 25% of the outlay (33.33 % for SC / ST
unit .To be considered with milch farmers)as back ended capital subsidy
 animals and not separately ) subject to a ceiling of Rs 5,500/- ( Rs
7300/- for SC/ST farmers,).
iv Purchase of milking machines Rs 20 lakh 25% of the outlay (33.33 % for SC / ST
/milkotesters/bulk milk farmers) as back ended capital subsidy
cooling units (upto 5000 lit subject to a ceiling of Rs 5.00 lakh ( Rs
capacity) 6.67 lakh for
SC/ST farmers).
v Purchase of dairy processing Rs 13.20 lakh 25% of the outlay (33.33 % for SC / ST
equipment for manufacture of farmers) as back ended capital subsidy
indigenous milk products subject to a ceiling of Rs 3.30 lakh ( Rs
4.40 lakh for SC/ST farmers)
vi Establishment of dairy product Rs 26.50 lakh 25% of the outlay (33.33 % for SC / ST
transportation facilities and cold farmers) as back ended capital subsidy
chain subject to a ceiling of Rs 6.625 lakh ( Rs
8.83 lakh for
SC/ST farmers).
vii Cold storage facilities Rs 33 lakh 25% of the outlay (33.33 % for SC / ST
for milk and milk products farmers) as back ended capital subsidy
subject to a ceiling of Rs 8.25 lakh ( Rs
11.00 lakh for SC/ST farmers).
viii Establishment of private veterinary Rs 2.60 lakh for mobile 25% of the outlay (33.33 % for SC / ST
clinics clinic and Rs farmers) as back ended capital subsidy
2.00 lakh for stationary subject to a ceiling of Rs 65,000/- and
clinic Rs 50,000/- (Rs 86,000/- and Rs
66,000/- for SC/ST farmers) respectively
for mobile and stationary clinics.

ix Dairy marketing outlet Rs 1.00 lakh/- 25% of the outlay (33.33 % for SC / ST
/ Dairy parlour farmers) as back ended capital subsidy
subject to a ceiling of Rs 25,000/-( Rs
33,300/- for
SC/ST farmers).

60. CENTRAL SECTOR SCHEME ON “PIG DEVELOPMENT” - NABARD

OBJECTIVES:
To encourage commercial pig rearing by farmers/ labourers to improve production
performances of native breed through cross breeding by using selected animals of high
performing breeds and by providing incentives in terms of capital subsidy for ensuring the viability
of the pig breeding, rearing and related activities.
ELIGIBILTY:
Producer companies, partnership firms, corporations, NGOs, SHGs, JLGs, cooperatives and
individual entrepreneurs.

SUBSIDY:
S.N. Components Unit size indicative Pattern of Assistance
Unit cost #
1 Pig breeding 20 F + 4M (unit cost 25% of the outlay (33 1/3 % in NE states
farms Rs. 6.00 lac) including Sikkim and hilly areas*) as back ended
subsidy subject to a ceiling of Rs. 1.50 lac
(Rs. 2.00 lac in NE states including Sikkim and
hilly areas*)
2 Pig rearing & 3 F + 1M (unit cost 25% of the outlay (33 1/3 % in NE states
fattening units Rs. 0.76 lac) including Sikkim and hilly areas*) as back ended
subsidy subject to a ceiling of Rs.19000/-
(Rs. 25300/- for NE states including Sikkim and
hilly areas*)
3 Retail outlets Unit cost Rs. 10 lac 25% of the outlay (33 1/3 % in NE states
including Sikkim and hilly areas*) as back ended
subsidy subject to a ceiling of Rs. 2.50 lac
(Rs. 3.33 lac in NE states including Sikkim and
hilly areas*)
4 Facilities for @ 2 per district 50% of the outlay as back ended subsidy subject
live markets to a ceiling of Rs. 2.50 lac.

F: Female (Sows), M: Male (Boars), TFO: Total Financial Outlay

* Where the project site is located at a height of more than 1000 meters above mean sea level
# There are indicative costs. The subsidy will be calculated based on the indicative or actual cost,
which ever is less, Banks are, however, free to sanction higher/ lower TFO also based on the local
conditions.
The subsidy pattern may change and guidelines issued by NABARD may be referred for same.

61. INTEGRATED DEVELOPMENT OF SMALL RUMINANTS AND RABBITS –

NABARD

OBJECTIVES OF THE SCHEME:

i. To encourage sheep/goat/rabbit rearing farmers to go in for commercial rearing rather than
subsistence farming by providing incentives for performance.
ii. The production performance of native breeds will be improved by regular selection and
culling based on measurable indicators.
iii. Facilitate marketing based on acceptable norms so that producer gets a fair share of the price
paid by ultimate consumer for the meat.
iv. To encourage value addition of the products locally and help farmer realise a better income
from the animals.

ELIGIBILITY:

(i) Individual farmers, SHGs are the intended beneficiaries for setting up rearing units.
Preference would be given for traditional shepherds, women, SC and STs

(ii) Individual farmers, NGO’s , Companies would be eligible for breeding farms with preference
for those who have organised the farmers into groups for taking up rearing of small ruminants and
rabbits.
FUNDING PATTERN:

Margin Rearing Units - Minimum 10% of Total Financial Outlay (TFO)

Breeding Units – Minimum 25% of outlay of TFO
Subsidy 25% or 33.33% of the outlay as per the eligibility subject to ceilings as
indicated under para ceilings on subsidy.
Bank Loan Bank Loan including subsidy not less than 50% of TFO. For project of
SC/ST, hilly and North Eastern Region, the bank loan including subsidy
should not be less than 58.33% of the TFO at the time of sanction.

CEILINGS ON SUBSIDY:

S.No Component Ceiling on Capital subsidy Ceiling on Capital Subsidy (for

(for general category SC/ST entrepreneurs, hill and NE
entrepreneurs) states including Sikkim)
1 Rearing of sheep and 25 % of the outlay subject to 33.33 % of the outlay subject to
goats (40+2) max. of Rs. 25,000/- max. of Rs. 33,300/-
2 Sheep and Goat Breeding 25 % of the outlay subject to 33.33 % of the outlay subject to
units (500+25) max. of Rs. 6.25 lakh max. of Rs. 8.33 lakh
3 Rabbit rearing units 25 % of the outlay subject to 33.33% of the outlay subject to
max. of Rs. 0.56 lakh max. of Rs. 0.75 lakh

The subsidy pattern may change and guidelines issued by NABARD may be referred for same.

62. POULTRY VENTURE CAPITAL FUND (SUBSIDY) SCHEME – NABARD

OBJECTIVES:
 To encourage poultry farming activity especially in non-traditional States and provide
employment opportunities in backward areas.

 Improve production of poultry products which have ready market all over country.

 To improve productivity of un-scientifically run units through technology upgradation.

 Provide quality meat to consumers in hygienic conditions, and improve hygienic sale of
poultry meat and products in urban areas and neighbourhood societies through poultry
dressing and marketing outlets.

 Improve productivity and facilitate rearing of other poultry species like quails, ducks, turkeys
etc which have good potential.

ELIGIBILITY:
1. Farmers, individual entrepreneurs, NGOs, companies, cooperatives, groups of unorganised and
organized sector which include Self Help Groups (SHGs), Joint Liability Groups (JLGs) etc.

2. An individual will be eligible to avail assistance for all the components under the scheme but only
once for each component.

3. When more than one member of a family is assisted under the scheme, the units set up by each
member should be with separate infrastructure at different locations with distinct identity. The
distance between the boundaries of two adjacent farms should be at least 500m.

4. Biosecurity norms should be kept in view while locating the units.

SUBSIDY:
S.No Component Unit Cost (Rs) Pattern of Assistance
i Breeding Farms for Rs 30.00 lakh - 25% of the utlay (33 .33 % for SC / ST farmers and NE
Low Input Technology Varies depending States including Sikkim ) as back ended capital subsidy
Birds like turkey, ducks, on the species and subject to a ceiling of Rs 7.50 lakh ( Rs 10.00 lakh for
Japanese quails, emu unit size. SC/ST farmers and NE States including Sikkim).
etc.
ii Central Grower Units Rs 40 .00 lakh for 25% of the outlay (33.33 % for SC / ST farmers and NE
(CGU) - upto 16000 a unit of 16000 States including Sikkim) as back ended capital subsidy
layer chicks per batch layer chicks per subject to a ceiling of Rs 10 lakh for a batch of 16000
batch (three birds ( Rs 13.33 lakh for SC/ST farmers and NE States
batches a year) - including Sikkim). Subsidy shall be restricted on a prorata
Varies with size basis depending on the unit size. Permissible maximum
unit size under the scheme is 16000 layer chicks per batch.
iii Hybrid Layer (chicken) Rs 8.00 lakh for 25% of the outlay (33.33 % for SC / ST farmers and NE
Units - upto 5000 2000 layer unit States including Sikkim) as back ended capital subsidy
layers - Varies with subject to a ceiling of Rs 1.00 lakh for 1000 birds ( Rs
the size. 1.33 lakh- for SC/ST farmers and NE States including
Sikkim,). Subsidy shall be restricted on a prorata basis
depending on the unit size subject to a ceiling of Rs 5
lakh ( Rs 6.65 lakh for SC / ST farmers and NE States
including Sikkim ) for a 5000 layer unit. Permissible
maximum unit size under the scheme is 5000 layers.
iv Hybrid Broiler Rs 2.24 lakh for 25% of the outlay (33.33 % for SC / ST farmers and NE
chicken) Units - upto a batch of 1000 States including Sikkim) as back ended capital subsidy
5000 birds. Can be broilers - Varies subject to a ceiling of Rs 56,000/- for a unit of 1000 birds (
weekly, fortnightly with unit size. Rs 74,600/- for SC/ST farmers and NE States including
monthly, all-in all-out Sikkim). Subsidy shall be restricted on a prorata basis
batches. Bird strength depending on the unit size, subject to a ceiling of Rs 2.80
at any point of time lakh ( Rs 3.73lakh for SC / ST farmers and NE States
should not exceed including Sikkim ) for a 5000 broiler unit . Permissible
5000 birds. maximum unit size is 5000 broilers at any point of time.
v Rearing other species Rs 10.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
of Poultry (Other than Varies with the States including Sikkim) as back ended capital subsidy
commercial layer and species and unit subject to a ceiling of Rs 2.50 lakh(Rs 3.33 lakh for
broiler chicken) size SC/ST farmers and NE States including Sikkim).

vi Feed Mixing units Rs 16.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
 (FMU) - 1.0 ton per States including Sikkim) as back ended capital subsidy
hour Disease subject to a ceiling of Rs 4.00 lakh (Rs 5.33 lakh for
Investigation Lab SC/ST farmers and NE States including Sikkim).
(DIL).
vii Transport Vehicles - Rs 8.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
open cage States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 2.00 lakh ( Rs 2.66 lakh for
SC/ST farmers and NE States including Sikkim).
viii Transport Vehicles - Rs 15.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
Refrigerated States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 3.75 lakh ( Rs 5.00 lakh for
SC/ST farmers and NE States including Sikkim).
ix Retail outlets - Rs 6.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
Dressing units States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 1.50 lakh( Rs 2.00 lakh for
SC/ST farmers and NE States including Sikkim).
x Retail outlets - Rs 6.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
marketing units States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 1.50 lakh ( Rs 2.00 lakh for
SC/ST farmers and NE States including Sikkim).
xi Mobile marketing units Rs 8.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 2.00 lakh ( Rs 2.66 lakh for
SC/ST farmers and NE States including Sikkim).
xii Cold storage for poultry Rs 20.00 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
products States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 5.00 lakh ( Rs 6.66 lakh for
SC/ST farmers and NE States including Sikkim).
xiii Egg / Broiler Carts Rs 10,000/ 25% of the outlay (33.33 % for SC / ST farmers and NE
States including Sikkim) as back ended capital subsidy
subject to a ceiling of Rs 2500/-(Rs 3300/- for SC/ST
farmers and NE States including Sikkim).
xiv Large Processing Rs 500 lakh 25% of the outlay (33.33 % for SC / ST farmers and NE
Units 2000-4000 birds States including Sikkim) as back ended capital subsidy
per hour subject to a ceiling of Rs 125.00 lakh (Rs 166.65 lakh for
SC/ST farmers and NE States including Sikkim).
Xv Emu Processing units Varies with unit 25% of the outlay (33.33 % for SC / ST farmers and NE
size States including Sikkim) as back ended capital subsidy.
xvi Feather Processing Varies with unit 25% of the outlay (33.33 % for SC / ST farmers and NE
Units size States including Sikkim) as back ended capital subsidy.
xvii Technology Varies with the 25% of the outlay (33.33 % for SC / ST farmers and NE
upgradation component States including Sikkim) as back ended capital subsidy.

Unit costs wherever given are indicative. In case the outlay is higher than the indicated costs, they
have to be met either through increased margin or bank loan.

Central grower units, Hybrid layer and broiler units exceeding the permissible unit size are not
eligible for assistance under the scheme.

The subsidy pattern may change and guidelines issued by NABARD may be referred for same.

(For details – PSLB/Farm Credit/ Circular No.24/11 dated 06.08.2011)

63. CAPITAL SUBSIDY SCHEME FOR INSTALLATION OF SOLAR

PHOTOVOLTAIC WATER PUMPING SYSTEM FOR IRRIGATION PURPOSE
ELIGIBLE BORROWERS:
Individuals, group of individuals, SHGs, JLGs, NGOs, Farmers’ Clubs and Farmers Producers
Organisation will be eligible for subsidy.

However, Private/ Public Limited Companies/ Corporates are not eligible.

PURPOSE:
Finance for installation of Solar Photovoltaic Pumping System for the purpose of irrigation.
NATURE OF FACILITY: Term Loan
MARGIN: Minimum 20%
REPAYMENT: Max. 10 years including a moratorium of max. 1 year.
SUBSIDY:
S.NO. SPV System Capacity Maximum Subsidy (Rs. per
HP)
1. DC Pumps Upto 2 HP 57600
>2 HP to 5 HP 54000
2. AC Pumps Upto 2 HP 50400
>2 HP to 5 HP 43200
3. For pumps > 5HP to 10HP, subsidy amount is fixed at Rs. 194,400/- per pump

64. PRADHAN MANTRI FASAL BIMA YOJANA

I. Objective of the Scheme: Providing financial support to farmers suffering from crop
loss/damage arising out of unforeseen events.
II. Coverage of Farmers: Loanee farmers for the notified crops would be covered compulsorily
and for non-loanee farmers coverage under the PMFBY is optional.
III. Coverage of Crops: 1) Food crops (Cereals, Millets and Pulses 2) Oilseeds and 3) Annual
Commercial / Annual Horticultural crops.
IV. Coverage of Risks includeS Prevented Sowing/ Planting Risk, Standing Crop (Sowing to
Harvesting), Post-Harvest Losses and Localized Calamities.
(Note: This scheme excludes losses arising out of war and nuclear risks, malicious damage and
other preventable risks.)
V. Preconditions for implementation of the Scheme:
Issuance of Notification by State Government / UT for implementation of the scheme (PMFBY).
VI. Notification : State Government/ UT shall also notify seasonality discipline for various
activities under the scheme viz. submission of insurance proposals, consolidated declarations by
banks, yield data, claim assessment of losses for (i) standing crop (ii) localized calamities, (iii)
prevented sowing,(iv) post harvest loss, (v) on-account payment for major calamities, etc as per the
provisions of the scheme.
VII. Sum Insured /Coverage Limit :
Sum Insured per hectare for both loanee and non-loanee farmers will be same and equal to the Scale
of Finance as decided by the District Level Technical Committee, and would be pre-declared by
SLCCCI and notified.

VIII. Premium Rates and Premium Subsidy

S. No. Season Crops Maximum Insurance
charges payable by
farmers ( % of Sum
Insured)
1. Kharif All foodgrains and Oilseeds crops (all 2% of sum insured or
Cereals, Millets,Pulses and Oilseed crops) Actuarial rate, whichever is
less
2. Rabi All foodgrains and Oilseed crops (all cereals 1.5 % of sum insured or
,Millets, Pulses and Oilseed crops) Actuarial rate, whichever is
less
3. Kharif and Annual Commercial /Annual Horticultural 2% of sum insured or
Rabi crops Actuarial rate, whichever is
less

IX. Seasonality Discipline

The cut-off date is uniform for both loanee and non-loanee cultivators. The State-wise cut off dates
for different crops shall be based on Crop Calendar of major crops published from time to time by the
Directorate of Economics and Statistics, Department of Agriculture, Cooperation and Farmers’
Welfare, Ministry of Agriculture and Farmers’ Welfare, Government of India.
Sl.No. Activity Kharif Rabi

1 Loaning period (loan sanctioned /renewed) for loanee April to October to

farmers covered on Compulsory basis.
July December
2. Cut-off date for receipt of proposals /debit of premium 31st July 31st December
from farmers account (loanee and non-loanee)

3. Cut-off date for receipt of consolidated declarations Within 15 days for loanee
/proposals of loanee farmers covered on compulsory basis farmers and and 7 days for
and non-loanee farmers covered on voluntary basis from non-loanee farmers after cut-
Bank branches (CBs/RRBs) to respective insurance. off date.

4. Uploading of soft copy of the details of individual insured Within 15 days after cut-off
farmers by banks. date for collection of premium
from farmers
CONSOLIDATED B. Category : KISHORE C. Category : TARUN
GUIDELINES ON small
Eligibility: Micro. MUDRA Eligibility: Micro. small Eligibility: Micro. small
LOANS
businesses
A. and Retail Non:
A. Category businesses and Retail Non Farm businesses and Retail Non
Farm Sector activities
SHISHU Sector activities Farm Sector activities
Amount of Loan: upto Rs. Amount of Loan: : above Amount of Loan: : above Rs.
50,000/- Rs.50,000/- and upto Rs. 5 5 lakh and upto Rs. 10 Lakh
lakh
Margin: Nil Margin: upto Rs 2 lakh: NIL
Above Rs 2 lakh: 15-25%, as per Margin: 15-25%, as per
relevant MSME Scheme relevant MSME Scheme
Collateral: Nil Collateral: Nil Collateral: Nil
Guarantee: As per scheme in case Guarantee: As per scheme in
of trading a/cs which are not case of trading a/cs which are
covered under CGTMSE not covered under CGTMSE
CGTMSE Coverage: All eligible CGTMSE Coverage: All eligible CGTMSE Coverage: All eligible
Borrowers to be covered under Borrowers to be covered under Borrowers to be covered under
CGTSME, as per existing CGTSME, as per existing Scheme, CGTSME, as per existing
Scheme, till MUDRA till MUDRA Guarantee Scheme is Scheme, till MUDRA
Guarantee Scheme is finalized finalized Guarantee Scheme is finalised

Repayment Period: 3-5 years Term Loan Repayment Period: 3- Term Loan Repayment Period:
5 years 3-5 years
C/C: to be renewed annually
Rate of interest: BR p.a. Rate of interest: as per LA Cir Rate of interest: as per LA Cir
76/2015 dated 07.09.2015) Base 76/2015 dated 07.09.2015
Rate + 2.25% p.a. (subject to Base Rate + 2.25% p.a.
change as per Bank guidelines) / (subject to change as per Bank
for CGTMSE covered cases guidelines) / for CGTMSE
BR+2% p.a. including t.p. covered cases BR+2% p.a.
including t.p.

Processing/Upfront fee: Nil Processing/Upfront fee: Nil T/L : upfront fee : 0.60%+ST
on loan amount
C/C : Processing fee : Rs 225/-
per lacs or part thereof

MUDRA Card: Disbursed by Documentation charges: Up to Documentation charges:

way of issue of MUDRA Rs. 2 lac : NIL Rs400/- per lac or part thereof
CARD (presently card limit Above Rs. 2 Lac : Rs400/- per lac (LA Cir 87/ dtd. 12.07.2014)
is fixed as Rs. 50,000/-) or part thereof (LA Cir 87/ dtd. As amended from time to time
12.07.2014) As amended from
time to time
 FINANCIAL INCLUSION

With the launch of PMJDY, the bank has opened more than 122.61 lacs accounts under PMJDY from
BC locations till 31.12.2015. Out of these 77.14 lacs accounts opened through BC network. RuPay
card is to be provided to all the account holders and for eligibility under Accidental Insurance
Cover of Rs.1.00 lac, RuPay Debit Card must be used at least once in 90 days. These cards at
present can be operated through ATMs, whose network is not adequate, particularly at remote / far
flung locations. The deployment of ATM at remote locations has got viability issues and therefore,
Micro-ATM can be deployed as substitute of ATM with only difference that BC agents will dispense
cash after successful transaction and also having lower cost of deployment and maintenance.

Deployment Micro-ATMs at Business Correspondent (BC) Locations

Services proposed to be delivered through Micro-ATMs:

Micro-ATMs would facilitate basic banking transactions i.e. (i) Cash Deposit and
Withdrawal, (ii) Transfer of Fund, (iii) Balance Enquiry, (iv) Mini Statement etc. Broadly
transactions would be four types i.e. (i) RuPay / Debit Card (PIN based authentication),
(ii) Aadhaar Based Transactions (Aadhaar Enabled Payment System – AEPS) ) through
Biometric authentication from UIDAI data base (iii) e-KYC Account Opening and (iv) FI
transactions presently undertaken through KBS.

Summary of Benefits expected by deploying Micro-ATMs:

(i) Micro-ATM will enhance the BC network capability to deliver services particularly
RuPay Cards i.e. PIN based transactions leading to increase their viability and also FI
operations.
(ii) At remote locations, adequate number of ATMs are not available as a result RuPay
Cards delivered to PMJDY account holders are not being used in majority of cases.
Micro-ATMs will bridge this gap.
(iii) Door Step banking envisaged under FI/PMJDY will really get a boost.
(iv) Deployment of Micro-ATMs will comply with DFS & RBI guidelines also.
(v) In compliance of recent Supreme Court interim order wherein Aadhaar cannot be
mandatory, therefore, deployment of Micro-ATMs will facilitate inter-operable
transactions through RuPay Cards.
(vi) RuPay/Debit Cards / AEPS transactions (Including Inter-operable) & help in keeping
RuPay Card holders eligible for accidental insurance claim.
(vii) Facilitate delivery of door step banking services (All villages / Wards).
(viii) Scaling up transactions at BC locations.
(ix) Help in reducing Zero balance account and Promoting other products / services
under BC network.

Delivery of demand notices by BCAs in NPA accounts

To intensify efforts for NPA recovery at micro level, involvement of the BCAs will
definitely have positive impact on recovery in allotted villages. Accordingly BCAs may be
involved in follow up of recovery and utilize their services for delivery of demand notices
in the allotted villages.
For delivery of recovery notices in NPA accounts in service area villages, the BC will be
paid a remuneration, being the delivery charges @ Rs 10/- plus applicable service tax
per notice/envelop. Instances may be possible that few borrowers have left the village.
For such cases, if BCA provides authenticated changed address/ mobile no., a sum of
Rs.5/- plus applicable service tax per case will be paid. The BCA will be assigned this
job of delivery of demand notices in his Sub Service Area (SSA) i.e. allocated villages
only.
REMUNERATION TO BUSINESS CORRESPONDENTS (BCS) FOR SEEDING OF
AADHAAR NUMBER AND ACTIVATION OF RUPAY CARDS.

Bank has extended the “Aadhaar Seeding facility at BC Locations” in addition to branches and
Alternate Delivery Channels (ADC).

Aadhaar Seeding at BC location Remuneration of Rs.5/- to Business

Correspondents for every successful
seedingofAadhaar number in the bank account
(One timeperaccount), opened at his/her location.
Aadhaar seeding in respect of accounts which
have not been opened at his/her location,
remuneration amount will be Rs.2/-(Onetime
peraccount).

RuPay CardsActivation by BCA through Remuneration of Rs. 5/- would be paid to

Micro-ATMs BCAs for every successful activation (one
time per account) to compensate for their
efforts for activation of RuPay Cards by way
of initiating financial/nonfinancial
transactions in the Bank accounts opened
at his/her location and the base branch
only.

INTRODUCTION OF MULTI BENEFIT TERM DEPOSIT (MBFD) SCHEME AT

BUSINESS CORRESPONDENT (BC) LOCATIONS UNDER KIOSK BANKING
SOLUTION (KBS).

Multi Benefit Terms Deposit Scheme (MBFD) is a variant of Fixed Deposit which is

This scheme has been customized at Kiosk Banking Solution (KBS) also to be used at BC
locations with limited functionalities. The functionalities available under BC network are
summarized below:
(i) The Fixed Deposit (MBFD) shall be opened for customer/s having operative Saving Fund
or Current account/s in our Bank. In case, the prospective customer does not have an
operative account, it would be opened before opening of Fixed Deposit (MBFD).
(ii) BC Agent would obtain account opening form (PNB 1177 for existing customer) and fill up
/ enter required details at BC location, which would be pushed to the CBS for opening of
account in the CBS system.
(iii) After submission of required data under KBS at BC location, BC Agents would issue
Provisional Fixed Deposit Receipt which would be system generated.
(iv) Final FDR receipt would be issued by the Base Branch after completion of required
formalities and deposit of the amount in the MBFD account and the same shall be handed
over to customer against acknowledgement from the customer.
(v) Other than aforesaid activities like Payment / closure / premature payment, change in
nominee, raising OD/Demand loan etc would be carried out at the base branch / other
branches as per the guidelines applicable.

PNB Turant (An Immediate Payment System (IMPS):

IMPS allows interoperable “Fund Transfer facility” on real time to customers, the Immediate
Payment Service (IMPS) with Person to Account (P2A) mode and already Implemented
through mobile phone, ATM and internet banking facility (IBS).
IMPS facility is being launched through BC network both for account holder as well as walk-
in customers.
Basic Requirement:
Sender:
 For Walk-in Customer : (i) Name , (ii) Father Name, (iii) City, (iv) State & (v) Mobile
Number
 Bank Customer : Account Number

Beneficiary: (i) Account Number & (ii) IFSC Code

Benefits: IMPS will serve following purposes.
 Fund may be remitted across the bank on real time basis
 Customer will have option to undertake cash 2 account or from A/c 2 A/c.
 It will improve customer base of the base branch/ BC location.
 Productivity of BC location will improve.
 Good source of fee based income

2.4 PNB Sanchay ( A Micro Deposit Scheme) :

Micro Deposit Scheme has been customized with focus to inculcate saving habit among low
income groups like small business man, vendors, rickshaw puller etc.
Basic Feature
Operational from Business Correspondent Network

Deposit Amount:
 Initial deposit of Rs.50/- and thereafter in multiple of Rs.50/-
 Maximum of Rs.5000/- at a time and maximum of Rs.60000/- p.a.
Period of deposit: 12 months to 36 months.
Penalty clause: No penalty on missed installments.
Payment of Interest:
 At CARD rate applicable to term deposits below Rs 1 Crore
 Interest shall be credited on half yearly basis of daily product

Nomination Facilities: Nomination facility is allowed.

Premature Closure: Facility available subject to certain conditions
Loan against Micro Deposit: Demand Loan will be available as per eligibility

3. Social Security Scheme of Government of India:

In the Budget 2015-16, following three ‘Special Security Schemes in Insurance and Pension
Sector’ were announced. Briefs on these Schemes appended below:

a) Pradhan Mantri Suraksha Bima Yojana [PMSBY]– for accidental death

insurance.
b) Pradhan Mantri Jeevan Jyoti Bima Yojana [PMJJBY]– for life insurance cover
c) Atal Pension Yojana [APY]

Salient features of the schemes are as under:

3.1 Atal Pension Yojana (APY): Atal Pension Yojana (APY) is a co-contributory fixed
pension Yojana to address the longevity risks among the workers in unorganized sector and
to encourage the workers in unorganized sector to voluntarily save for their retirement. The
APY will be focused on all citizens in the unorganized sector, who join the National Pension
System (NPS) administered by the Pension Fund Regulatory and Development Authority
(PFRDA).
(i) Eligibility: All citizens in the unorganized sector who are not members of any
statutory social security scheme.
(ii) Age: 18 years to 40 years.
(iii) Benefit : The Central Government would co-contribute 50% of the subscriber’s
contribution or Rs.1000 per annum, whichever is lower, to each eligible
subscriber account, for a period of 5 years, i.e., from 2015-16 to 2019-20, who
join the NPS before 31st December, 2015 and who are not income tax payers.
(iv) Pension : The subscribers would receive the fixed pension of Rs.1000 per month,
Rs.2000 per month, Rs.3000 per month, Rs.4000 per month, Rs.5000 per month,
at the age of 60 years, depending on their contributions, which itself would vary
on the age of joining the APY.
(v) Launching: The APY would be launched from 1st June, 2015.
(vi) The existing subscribers of Swavalamban Scheme would be automatically
migrated to APY, unless they opt out.

3.2 Pradhan Mantri Suraksha Bima Yojna (PMSBY):

(i) Renewable annual personal accident covers from 1st June to 31st May.
(ii) Eligibility: All Aadhaar linked bank account holders in the age group 18 to 70
years.
(iii) Cover : a) Accidental death or full disability : Rs.2 lakh
b) Partial disability: Rs 1 lakh Premium: Rs.12 per year + service tax
(Rs.10 for insurance co and Rs.1 each for Bank & BC / micro insurance agent).
(iv) Premium payment: Subscriber to fill subscription form and auto debit option by
31st May and amount to be remitted by Bank to insurer in same month.
Subscription period extendable in initial year till 31st August. Cover to commence
from 1st of the month after premium is paid.
(v) Long term subscription / auto debit option, subject to continuation of scheme /
terms as may be revised, possible.
(vi) In case of joint accounts each account holder may take the cover by separately
paying the premium.
(vii) Notwithstanding multiple accounts, a person can take only one cover through any
one Aadhaar linked bank account.

3.3 Pradhan Mantri Jivan Jyoti Bima Yojna (PMJJBY)

(i) Renewable annual life cover scheme from 1st June to 31st May
(ii) Eligibility: All Aadhaar linked bank account holders in the age group 18 to 50
years, with coverage upto 55 years on payment of premium after attaining age
50.
(iii) Cover: Rs.2 lakh cover for death by any reason.
 (iv) Premium: Rs.330 per year + service tax (Rs.289 for insurance company, Rs.11
for Bank & Rs.30 BC/micro insurance agent).
(v) Premium payment: Subscriber to fill subscription form and auto debit option by
31st May and amount to be remitted by Bank to insurer in same month.
Subscription period extendable in initial year till 31st August. Cover to commence
from 1st of the month after premium is paid.
(vi) Long term subscription / auto debit option, subject to continuation of scheme /
terms as may be revised, possible.
(vii) In case of joint accounts each account holder may take the cover by separately
paying the premium.
(viii) Notwithstanding multiple accounts, a person can take only one cover through
any one Aadhaar linked bank account.
(ix) IBA, PFRDA & GIPSA (General Insurance Public Sector Association) are in
process of framing guidelines for implementation of Atal Pension Yojna (APY)
and Pradhan Mantri Suraksha Bima Yojna (PMSBY).

Make in India: Objective, Benefits, Feature:

Make in India Campaign Objective

Ultimate objective to make India a renowned manufacturing hub for key sectors. Companies
across the globe would be invited to make investment and set up factories and expand their
facilities in India and use India’s highly talented and skilled manpower to create world class
zero defect products. Mission is to manufacture in India and sell the products worldwide.

How this would be achieved

Skill development programs would be launched especially for people from rural and poor
ones from urban cities

25 key sectors have been short listed such as telecommunications, power, automobile,
tourism, pharmaceuticals and others

Individuals aged 15-35 years would get high quality training in the following key areas such
as welding, masonries, painting, nursing to help elder people

Skill certifications would be given to make training process, a standard. Currently

manufacturing in India suffers due to low productivity rigid laws and poor infrastructure
resulting in low quality products getting manufactured

Over 1000 training centres would be opened across India in the next 2 years
For companies setting up factories, “Invest India” unit is being set-up in the commerce
department which would be available 24/7. The main focus of this department would be to
make doing business in India easy by making all the approval processes simpler and
resolving the issues in getting regulatory clearances within 48-72 hours so that clearances
are fast. To make this possible, special team would be available to answer all the queries
related to help foreign investors/companies.

The e-biz portal would be soon launched which would be real time and available 24*7
Benefits
This will help in creating job market for over 10 million people in India
Manufacturing done here would boost India’s GDP, trade and economic growth

MAKE IN INDIA

Prime Minister Narendra Modi unveiled the 'Make in India' campaign, rolling out a red
carpet to attract investors to make India a global manufacturing hub, to help create jobs and
boost economic growth.

Here are the highlights of Narendra Modi's speech:

* In last 2-3 years, people talked of shifting industry outside the country.

* We have reversed the trend of investors going outside the country.

* Rule of law should be there, corporate government responsibility should be the norm: PM.

* India is an opportunity: PM to foreign investors.

* Manufacturing boost will create jobs, increase purchasing power, thereby creating larger
mkt for manufacturers:

* Industrialists don't come because of incentives, need to create development and growth-
oriented environment

* Be assured you will not lose your money: PM to industrialists.

* Not just good governance, effective governance is also required

* Effective governance, easy governance need of the hour

* We need highways and i-ways (information ways)

* Govt is committed to growth, there is no political agenda but article of faith

* States and Centre should work as a team; development of states is development of India

The implementation of GST will lead to the abolition of other taxes such as octroi, Central
Sales Tax, State-level sales tax, entry tax, stamp duty, telecom licence fees, turnover tax,
tax on consumption or sale of electricity, taxes on transportation of goods and services, et
cetera, thus avoiding multiple layers of taxation that currently exist in India.

But just what is GST all about and how will it impact you?

What is GST?

Goods and Services Tax -- GST -- is a comprehensive tax levy on manufacture, sale and
consumption of goods and services at a national level.

Through a tax credit mechanism, this tax is collected on value-added goods and services at
each stage of sale or purchase in the supply chain.

The system allows the set-off of GST paid on the procurement of goods and services against
the GST which is payable on the supply of goods or services. However, the end consumer
bears this tax as he is the last person in the supply chain.
Experts say that GST is likely to improve tax collections and boost India's economic
development by breaking tax barriers between States and integrating India through a
uniform tax rate.

What are the benefits of GST?

Under GST, the taxation burden will be divided equitably between manufacturing and
services, through a lower tax rate by increasing the tax base and minimizing exemptions.

It is expected to help build a transparent and corruption-free tax administration. GST will be
is levied only at the destination point, and not at various points (from manufacturing to retail
outlets).

Currently, a manufacturer needs to pay tax when a finished product moves out from a
factory, and it is again taxed at the retail outlet when sold.

How will it benefit the Centre and the States?

It is estimated that India will gain $15 billion a year by implementing the Goods and Services
Tax as it would promote exports, raise employment and boost growth. It will divide the tax
burden equitably between manufacturing and services.

What are the benefits of GST for individuals and companies?

In the GST system, both Central and State taxes will be collected at the point of sale. Both
components (the Central and State GST) will be charged on the manufacturing cost. This will
benefit individuals as prices are likely to come down. Lower prices will lead to more
consumption, thereby helping companies.

NITI Aayog or National Institution for Transforming India Aayog is a policy think-tank of
government that replaces Planning Commission and aims to involve the states in economic
policy-making in India. It will be providing strategic and technical advice to the central and
the state governments. Prime Minister of India heads the Aayog as its chairperson.

Government had announced formation of NITI og on 1 January 2015.

There are couples of things to be considered here.

In Hindi, NITI (Hindi: नीति) means Policy,

And Ayog(Hindi: आयोग) means Commission.

NITI Aayog would therefore mean:

• A group of people with authority entrusted by the government to formulate/regulate policies

concerning transforming India.

• It is a commission to help government in social and economic issues.

• Also it's an Institute of think tank with experts in it.

All you should know about 'Swach Bharat Abhiyan'

1.What is the goal?

By 2019, Gandhi's 150th birth anniversary, every city, town and village is to be 'clean', that
is, they will have pucca toilets for all, safe drinking water, waste disposal systems and cleans
roads & lanes.

2.Construction of toilets is the major priority

Construction of household toilets has been identified as one of the major focus area since
53% households in the country don't have toilet facilities, according to 2011 Census. The
situation is far worse in rural areas where 69.3% rural homes have no such facility. Over
78% of rural households in states like Jharkhand, Bihar, Rajasthan, Orissa and Chhattisgarh
don't have toilets.

3.What will it cost?

The estimated cost is humungous - in all, Rs 1.96 lakh cr, of which Rs 1.34 lakh cr will be
spent to build 11 cr pucca loos in villages and Rs 62,000 cr to build 5.1 lakh community and
public loos in urban areas. No budget given for toilet maintenance.

4.Who will fund all this?

Now, that's not very clear. Govt says it will spend Rs 14,623 cr on urban toilets, but doesn't
divulge the figure for rural loos. Babus say the remainder will come from state govts, PPP
projects and budgetary allocations over 5 years. Some PSUs & pvt companies have pledged
financial support for project.

5.What will happen on Thursday?

Every minister and babu will take on the cleanliness project, many with broom in hand. Modi
will lead the campaign. Most of central Delhi will be shut for motorists.

6.Who's the unintended beneficiary?

AAP, of course. Its netas and workers are supposed to join the campaign, brandishing jadus,
the party's symbol.

Saansad Adarsh Gram Yojana'.:

On the birth anniversary of socialist stalwart Jai Prakash Narayan, Prime Minister Narendra
Modi on Saturday launched the ambitious 'Saansad Adarsh Gram Yojana'.

The rural development scheme aims at improving the standard of living and quality of life of
all sections of people by improving basic amenities.

The scheme announced by PM Modi on August 15 during his Independence Day address
from the ramparts of the Red Fort was drafted by the Ministry of Rural Development.

Here are some of the key features of the 'Saansad Adarsh Gram Yojana' -

A Member of Parliament must identify a village, other than his or her own village or that of
the spouse, and turn it into a 'model village' by 2016 and two more villages two 2019. After
2019, the MP must develop five model villages till 2024 (each every year).
MPs must identify villages from nearby rural areas not their urban constituencies.

The scheme will put special focus on empowering the poor household to come out of poverty
by developing a plan for every identified gram panchayat.

The yojna aims at turning villages into model villages not only by infrastructure development
but also by gender equality, dignity of women, social justice, community service, cleanliness,
eco-friendliness, peace and harmony.

Mutual-cooperation, self reliance, local self-government, transparency and accountability in

public life will also be expected.
Social mobilisation and a systematic environment will be created in the model village led and
guided by the MP him/herself.

The District Collector will coordinated the planning process of the Gram Panchayat which will
be a participatory exercise.

The launched scheme is different from the UPA's Pradhan Mantri Adarsh Gram Yojana as it
focused on villages only which had SC communities as more than half the population.

SMALL & PAYMENTS BANKS

Only 35% of Indians have accounts with financial institutions, according to World
Bank estimates. To service the remaining population, the Reserve Bank of India (RBI) has
created two new banking categories, called small finance banks and payment banks.
Small banks will be similar to existing commercial banks but will offer only basic products
such as deposits and loans. At least half of a small bank's loan portfolio should constitute
loans and advances of up to Rs 25 lakh, according to RBI.
Payment banks are meant for simple banking transactions. These institutions will not be
allowed to lend or accept term deposits. Customers can't keep more than Rs 1 lakh in their
account.

SMALL BANKS
· The purpose of the small banks will be to provide a whole suite of basic banking products
such as deposits and supply of credit, but in a limited area of operation.
· The objective for these Small Banks is to increase financial inclusion by provision of
savings vehicles to under-served and unserved sections of the population, supply of credit to
small farmers, micro and small industries, and other unorganised sector entities through high
technology-low cost operations.
· Resident individuals with 10 years of experience in banking and finance, companies and
Societies will be eligible as promoters to set up small banks. NFBCs, micro finance
institutions (MFIs), and Local Area Banks (LABs) can convert their operations into those of a
small bank. Local focus and ability to serve smaller customers will be a key criterion in
licensing such banks.
· Branch expansion: For the initial three years, prior approval will be required.
· The area of operations would normally be restricted to contiguous districts in a
homogenous cluster of states of union territories so that the Small Bank has a ‘local feel’ and
culture. However, if necessary, it would be allowed to expand its area of operations beyond
contiguous districts in one or more states with reasonable geographical proximity.
· The bank shall primarily undertake basic banking activities of accepting deposits and
lending to small farmers, small businesses, micro and small industries, and unorganised
sector entities. It cannot set up subsidiaries to undertake non-banking financial services
activities. After the initial stabilisation period of five years, and after a review, the RBI may
liberalise the scope of activities for Small Banks.
· The promoters’ other financial and non-financial services activities, if any, should be
distinctly ring-fenced and not co-mingled with banking business.
· A robust risk management framework is required and the banks would be subject to all
prudential norms and RBI regulations that apply to existing commercial banks, including
maintenance of CRRand SLR.
· In view of concentration of area of operations, the Small Bank would need a diversified
portfolio of loans, spread over it area of operations.
· The maximum loan size and investment limit exposure to single/group borrowers/issuers
would be restricted to 15 per cent of capital funds.

· Loans and advances of up to Rs 25 lakhs, primarily to micro enterprises, should constitute

at least 50 per cent of the loan portfolio.
· For the first three years, 25 per cent of branches should be in unbanked rural areas.
PAYMENT BANKS
· Objective of payments banks is to increase financial inclusion by providing small savings
accounts, payment/remittance services to migrant labour, low income households, small
businesses, other unorganised sector entities and other users by enabling high volume-low
value transactions in deposits and payments/remittance services in a secured technology-
driven environment.
· Those who can promote a payments banks can be a non-bank PPIs, NBFCs, corporate’s,
mobile telephone companies, super market chains, real sector cooperatives companies and
public sector entities. Even banks can take equity in Payments Banks.
· Payments Banks can accept demand deposits (only current account and savings
accounts). They would initially be restricted to holding a maximum balance of Rs 100,000
per customer. Based on performance, the RBI could enhance this limit.
· The banks can offer payments and remittance services, issuance of prepaid payment
instruments, internet banking, functioning as business correspondent for other banks.
· Payments Banks cannot set up subsidiaries to undertake NBFC business.
· As in the case of Small Banks, other financial and non-financial services activities of the
promoters should be ring-fenced.
· The Payments Banks would be required to use the word ‘Payments’ in its name to
differentiate it from other banks.
· No credit lending is allowed for Payments Banks.
· The float funds can be parked only in less than one year G-Secs
Mudra ( Micro Units Development Refinance Agency) Bank for small firms with Rs
20,000 crore corpus
The scheme, which has a corpus of Rs 20,000 crore, can lend between Rs 50,000 and Rs
10 lakh to small entrepreneurs. "Through MUDRA Bank our target and focus is on 5.75 crore
who use funds of Rs 11 lakh crore, with an average per unit debt of merely Rs 17,000," A
loan benefit of Rs 1 lakh to these entrepreneurs will provide a big push to the country's gross
domestic production (GDP).

MUDRA Bank will instill a new confidence in the small entrepreneurs that have been to
exploitation at the hands of money lenders so far, The large business houses, which attract
a lot of media attention, provide employment to only 1.25 crore people. Small borrowers
repay loans promptly, AND "saving is a habit in India and there is a need to (give a) push to
this traditional strength".

The Prime Minister asked the bankers to study the successful microfinance models being
followed in other parts of the world and try to adapt them according to the local
requirements.

MUDRA Bank is aimed at "funding the unfunded". Although 20% of the country's population
is dependent on 5.7 crore micro and small entrepreneurs, they do not have access to
institutional credit.

The government has appointed Jiji Memon, chief general manager with Nabard, as CEO of
Mudra Bank. "The institution has started the refinance activity at 7% interest rate," The
lending rate (to the end borrower) will be decided on the risk margin that the microfinance
institution will undertake.

Top 6 initiatives of the Prime Minister

1-Pradhan Mantri Jan DHan Yojna:
Taking an initiative of bank account for every citizen, PM launched mega pet project, the
Pradhan Mantri Jan Dhan Yojana. The Jan Dhan Yojna aimed to make available formal
banking to 1 crore people and provided accident insurance cover to “1.5 crore people”. The
initiative also aims to provide bank accounts to 100 crore people in the next one year.
National Mission on Financial Inclusion titled, ‘Pradhan Mantri Jan Dhan Yojana’ (PMJDY) in
the first Independence Day speech on August 15, 2014.

Although it is a good idea to have a bank account for every Indian, one still wonders how, or
rather why will the poorest of the poor save their meagre incomes in the banks. Moreover,
the concern about the financial viability of maintaining such accounts also exists. Apart from
giving direct bank transfers to Aadhar-linked accounts there is not much use for such bank
accounts. But one cannot ignore the fact that these accounts will be helpful for money
transaction especially for rural population.

Scheme Details
Pradhan Mantri Jan-Dhan Yojana (PMJDY) is National Mission for Financial Inclusion to
ensure access to financial services, namely, Banking/ Savings & Deposit Accounts,
Remittance, Credit, Insurance, Pension in an affordable manner.
Account can be opened in any bank branch or Business Correspondent (Bank Mitr) outlet.
PMJDY accounts are being opened with Zero balance. However, if the account-holder
wishes to get cheque book, he/she will have to fulfill minimum balance criteria.
Documents required to open an account under Pradhan Mantri Jan-Dhan Yojana

1. If Aadhaar Card/Aadhaar Number is available then no other documents is required. If

address has changed, then a self certification of current address is sufficient.
 2. If Aadhaar Card is not available, then any one of the following Officially Valid
Documents (OVD) is required: Voter ID Card, Driving License, PAN Card, Passport &
NREGA Card. If these documents also contain your address, it can serve both as
“Proof of Identity and Address”.
3. If a person does not have any of the “officially valid documents” mentioned above,
but it is categorized as ‘low risk' by the banks, then he/she can open a bank account
by submitting any one of the following documents:
a. Identity Card with applicant's photograph issued by Central/State Government
Departments, Statutory/Regulatory Authorities, Public Sector Undertakings,
Scheduled Commercial Banks and Public Financial Institutions;
b. Letter issued by a gazette officer, with a duly attested photograph of the person.

Special Benefits under PMJDY Scheme

a. Interest on deposit.
b. Accidental insurance cover of Rs.1.00 lac
c. No minimum balance required.
d. Life insurance cover of Rs.30,000/-
e. Easy Transfer of money across India
f. Beneficiaries of Government Schemes will get Direct Benefit Transfer in these accounts.
g. After satisfactory operation of the account for 6 months, an overdraft facility will be
permitted
h. Access to Pension, insurance products.
i. Accidental Insurance Cover, RuPay Debit Card must be used at least once in 45 days.
j. Overdraft facility upto Rs.5000/- is available in only one account per household,
preferably lady of the household.
 Foreign Exchange
Foreign Exchange It includes all deposits, Credit and Balances payable in Foreign currency. It also
includes Drafts/TCs, LCs and Bills of Exchange payable in Foreign currency. In
means all claims payable abroad.
Forex Market It comprises of individuals and entities including banks across the globe without
geographical boundaries. Forex market is dynamic and it operates round the clock.
Exchange rate of major currencies change after every 4 seconds. It opens from
Monday to Friday except in Middle east countries where it is closed on Friday and
opens on Sunday and Monday.
Exchange Rate When settlement of funds and exchange of
mechanism currency takes place_________
TOD rate or Cash Rate Same day (it is also called ready rate)
TOM Rate Next working day
Spot Rate 2nd working day (48 hours)
Forward Rate After few days/months
If Next day or 2nd day is holiday in either of the two countries, the
settlement will take place on next day. For example Spot deal is stuck on
23rd Dec. 25th is Christmas Day and 26th is Sunday. Under such
circumstances, value date will be 27th i.e. Monday.
 There are two types of rates- Fixed and Floating. Floating rates are
determined by market forces of Demand and Supply. India switched to
Floating exchange rates regime in 1993.
CARD RATES are rates calculated at beginning of day with full margin as advised
by FCTM, Mumbai and are indicative rates up to USD 5000.
Buy and Sell Maxim Buy Low Sell High
Buy rate is also called Bid Rate and Sell Rate is called Offer Rate.
Forward Rates It is required when currency is exchanged after few months/days.
Buy Transactions :
Spot Rate (+ ) premium OR ( - ) Discount
( Lower premium is added OR Higher discount is deducted )
Sale Transactions:
Spot Rate (+ )Higher premium OR (-) Lower discount
(So that currency may become cheaper while buying and dearer while selling)
In India, Forward Contracts are available for Maximum period of 12 Months.
Examples of Forward Euro 1 = USD$1.3180/3190
rates Forward differentials:
1M = 15/18, 2M= 30/37, 3M=41/49
Calculate 2M Bid rate and 3M Offer rate
2M Bid rate = 1.3180+.0030 = 1.3210
 3M Offer rate = 1.3190+.0049=1.3239
Exchange Margin Exchange margin is deducted while buying and added while selling.

Direct, Indirect and Direct Rates

Cross Rates Foreign Currency is fixed ---say 1USD = INR 55.70
Indirect Rates
Local currency remains fixed---say Rs. 100 = 1.93 USD
At present, following 4 currencies are quoted in Indirect mode:
EURO, GBP, AUD and NZ$
Cross Rates
Cross rate is price of currency pair which is not directly quoted. It is arrived at from
price of two other currency equations.
1. Suppose bank has to Quote GBP against INR, but in India, GBP is not
quoted directly. In India,
1USD =48.10 and GBP/USD is quoted as 1GBP= USD1.6000.
Therefore 1 GBP = 48.10X1.6 = 76.96
2. An Import bill of GBP 100000 has to be retired. Rates are:
1 GBP=1.5975/85 USD
1USD = 48.14/15 INR
TT margin =.20%
Here Cross selling rate of both currencies will apply. (Only Domestic
market)
1GBP=1.5985*48.15 = 76.9675 + Margin@.20% = 77.1214 (say 77.1225)

All currencies are quoted as per unit of currency whereas the following currencies
are quoted as 100 units of Foreign currency:
1. Japanese Yen
2. Indonesian Rupiahs
3. Kenyan Schilling.
4. Belgian Francs
5. Spanish Peseta
Intervening Currencies in India
1. US Dollar
2. British Pond
Cross Rates where two Suppose, In India, 1USD=42.8450/545 and in UK, 1USD=.7587/.7590 EURO. The
markets are involved customer intends to remit Euro and he desires to know 1 Euro = ? INR. We will buy
and one of them is Euro against sale of USD. (One is domestic market and other is International
international market market)
Calculation
Sell rate of 1USD = .42.8545 and Buy Rate of Euro is 1USD=.7587
.7587Euro = 1USD = INR 42.8545
1 EURO = 42.8545/.7587 = 56.48
In India, there is Full Convertibility of Current Account transactions.
Example Where one currency is bought and another currency is sold
A wants to remit JPY 100.00 million at TT spot with margin @.15%. Given
USD/INR at 48.2500/2600 and in Japan USD/JPY = 90.50/60
Solution:
We will buy Japanese Yen and sell USD and the rate to be applied is:
48.2600/90.50 = .533260 per JPY
Rate per 100 JPY = 53.3260 + Margin @.15%(.0799) = 53.4059 (say 53.4050)
TT Rates and Bill Rates
Following 4 types of buying and selling rates are important:
1. TT Buying rate
2. Bill Buying rate
3. TT Selling rate
4. Bill Selling rate
In Interbank market, exchange rate is quoted up to 4 decimals in multiples of 0.0025. e.g. 1USD=53.5625/5650

For customers the exchange rate is quoted in two decimal places i.e. Rupees and paisa. e.g. 1 USD =Rs. 55.54.

Amount being paid or received will be rounded off to nearest Rupee.

TT Buying Rate It is required to calculate when our Nostro account is already credited or being
credited without delay e.g. Receipt of DD, MT, TT or collection of Foreign bills.
This rate is used for cancellation of Forward Sales Contract.
Calculation Spot Rate – Exchange Margin
Bill Buying Rate Bill Buying rate is applied when bank gives INR to the customer before receipt of
Foreign Exchange in the Nostro account i.e. Nostro account is credited after the
purchase transaction. In such cases.
Examples are:
 Export Bills Purchased/Discounted/Negotiated.
 Cheques/DDs purchased by the bank.
Calculation
Spot Rate + Forward Premium (or deduct forward discount) – Exchange margin.
TT Selling Rate Any sale transaction where no delay is involved is quoted at TT selling rate. It is
desired in issue of TT, MT or Draft. It is also desired in crystallization of Export
 bills and Cancellation of Forward purchase contract.
Calculation
Spot Rate + Exchange Margin
Bill Selling Rate It is applied where handling of documents is involved e.g. Payment against Import
transactions:
Calculation
Spot Rate + Exchange Margin for TT selling + Exchange margin for Bill Selling

Examples
Q. 1
Bank received MT of USD 5000 on 15th Sep. The Nostro account was already credited. What amount will be
paid to the customer: Spot Rate 34.25/30. Oct Forward Differential is 22/24. Exchange margin is .80%

Solution
TT buying Rate will be applied
34.25 - .274 = 33.976 Ans.

Q. 2
On 15th July, Customer presented a sight bill for USD 100000 for Purchase under LC. How much amount will be
credited to the account of the Exporter. Transit period is 20 days and Exchange margin is 0.15%. The spot rate
is 34.75/85. Forward differentials:
Aug: .60/.57 Sep:1.00/.97 Oct: 1.40/1.37

Solution
Bill Buying rate of August will be applied.
Spot Rate----34.75 Less discount .60 = 34.15
Less Exchange Margin O.15% i.e. .0512 =34.0988 Ans.
( Transit period is rounded to next month since currency will be cheaper as it is buy transaction)
Q. 3
Issue of DD on New York for USD 25000. The spot Rate is IUSD = 34.3575/3825 IM forward rate is
34.7825/8250
Exchange margin: 0.15%
Solution:
TT Selling Rate will Apply
Spot Rate = 34.3825 Add Exchange margin (.15%) i.e. 0.0516
TT Selling Rate = Spot Rate + Exchange Margin = 34.4341 Ans.
Q. 4
On 12th Feb, received Import Bill of USD-10000. The bill has to retired to debit the account of the customer.
Inter-bank spot rate =34.6500/7200. The spot rate for March is 5000/4500. The exchange margin for TT selling
is .15% and Exchange margin for Bill selling is .20%. Quote rate to be applied.
Solution
Bill Selling Rate will be applied.
Spot Rate + Exchange margin for TT Selling + Exchange margin for Bill selling = 34.7200+.0520+.0695 =
34.8415 Ans.
RATES TO BE APPLIED IN FOREIGN EXCHANGE TRANSACTIONS
Nature of transaction Rate to be applied
Encashing Foreign currency Currency Buying rate
Encashing Traveler Cheques TC Buying rate
Issue of Draft in Foreign currency TT Selling rate
Payment of draft where Nostro account stands TT Buying rate
credited already
Purchase of Export Bill Bill Buying rate
Purchase of Sight Bill i.e. DP under FOBP Bill Buying
Discounting of Usance Bill i.e. DA under FUBD Spot rate - Exchange Margin + Forward Premium
Payment of Imports Bill Selling
Repatriation of NRE deposits TT selling
Repatriation of FCNR deposits No rate
Crystallization of Overdue Export Bills on 30th day TT Selling rate or Original Bill buying rate
after Notional due date Whichever is higher
Crystallization of LC liability on 10th day Bill Selling rate or Contracted rate Whichever is
higher
Retirement of Import Bill Bill Selling rate
Crystallization of Import bill on 10th day If there is Bill Selling rate or Contracted rate Whichever is
default by the buyer higher
Cancellation of Forward Purchase Contract on 7th TT selling rate
working day after due date
Cancellation of Forward Sales Contract on 7th TT buying rate
Working Day after due date
Forward Contract – Due date and Transit period
(Bill Buying Rates and Bill Selling Rates)
If due date after adding transit period and forward period falls in a particular month
Buy Transactions
Quote rates applicable to lower month (if currency is at premium) and same month (if currency is at discount)
due to the reason that currency becomes cheaper and Buy low and Sell High
Sale Transactions
Quote rates applicable to Same month (if currency is at premium) and lower month (if currency is at discount)
due to the reason that currency becomes dearer and Buy low and Sell High
Forward contracts can be booked by Resident Individuals up to USD1lac.
Buy Transactions- Spot Rate on 16.07.2012 is 1 USD = 34.6850/7275
Currency at Premium Spot August = 4000/4200, Spot Sep = 7500/7700, Spot Oct = 1.05/1.07
Spot Nov =1.40/1.42
Transit Period is Transit Period = 25 days , Exchange Margin = 0.15%
rounded off to lower Calculate Forward Buying Rate of 3 M Usance bill.
month in which due Due date of realization of Bill = 16.7.2012 + 3M + 25 days = 9.11.2012
date falls By Rounding Transit period to lower month, Oct Rate will be as under:
34.6850+1.05 - .0536 (exchange margin) = 35.6814
Buy Transactions- On 22.7.2013,
Currency at Discount Spot Rate is 35.6000/6500 Forward 1M=3500/3000 2M=5500/5000
3M=8500/8000
Transit Period is Transit Period ----20 days Exchange Margin = 0.15%.
rounded off to same Find Bill Buying Rate & 2 M Forward Buying Rate
month in which due Solution
date falls Bill Buying Rate (Ready) : Bill Date +20 days = 11.8.2013
Spot Rate = 35.6000 Less Forward Discount 1M (0.3500) Less Exchange Margin
0.15% (0.529)
i.e. 35.6000-.3500-.0529(0.15% of 35.2500) = 35.1971
2 M Forward Buying Rate: = Transaction date +2M +20 days =11.10.13
3 Month Forward Buying Rate will be applied.
Spot Rate = 35.6000 Less Forward Discount of 3M (.8500) Less Exchange Margin
(.0521)
i.e. 35.6000-.8500-.0521(0.15% of 34.7500) = 34.6979 Ans.
Cancellation of Deal Cancellation of Buy contract is done at TT selling rate and cancellation of Sale
contract is done at TT buying rate.
Example
A bank purchased export bill of USD 50000 at Rs. 42.66, which was dishonored for non-payment. How much
amount will be recovered from exporter, if Spot rate is 42.2000/3000. Exchange margin is 0.15%.
Solution
TT selling rate will be applied to recover the amount
TT Selling rate= Spot rate +Exchange margin
=42.3000+0.06345 = 42.36345= 42.3625 (Rounding off to nearest .0025)
Amount to be debited to customers’ account =50000*42.3625 =2118125 --------------Ans.
Value Date It is date on which payment of funds or entry to an account becomes effective.
Under TT transaction, value date is same. In other spot and forward contracts, Value
Date is the date when Nostro Account is actually credited.
Arbitrage It consists of purchase of one currency in one center accompanied by immediate
 resale against same currency at other center.
Per Cent and Per Mille 1% is on part of 100 whereas per mille is 1 part of thousand
Authorized Dealers Authorized dealers are called Authorized Persons. The categories are as under:
AP category 1 -----AD banks, FIs dealing in Forex transactions.
AP category 2-----Money changers authorized to sell and purchase Foreign
currency notes, TCs and Handle remittances.
AP category 3----Only purchase of Foreign currency and Travelers Cheques. These
were earlier called “Restricted Money Changers.”
Forward Point Spot Rate
Calculation Euro 1 = US$1.3180
3 Month Forward Rate
Euro 1 = US$1.3330
Forward Point = 1.3330 – 1.3180 = 150 points
Arbitrage & Forward It consists of purchase of one currency in one center accompanied by immediate
Point Calculation resale against same currency at other center.
Example:
Let us borrow from one center and lend at other center at higher rate. In USA, rate
of interest is 6% whereas in Germany, rate of interest is 3% for EURO. We will
borrow from Germany and lend in USA where
1EURO =1.5 USD
Forward Point Calculation for 3 Months
Spot Rate x Interest rate difference x Forward Period
100 x Nos. of days in a year
= 1.5 x 3 x 90
100*360
=0.01125
3 month swap rate = 1.5 + 0.01125 = 1.5112
Calculation of Interest Differential
Forward Points x Nos. of Days x 100
Forward Period x Spot Rate
= 0.01125 x 360 x 100 =3% 1.5 x 90
Forex Dealing Room It is a service branch which deals Buying and Selling Operations of the bank. It
operations manages Foreign currency Assets and Liabilities and also manages Nostro accounts.
A dealer has to maintain two positions:
1. Funds position
2. Currency Position
Currency position can be Overbought or Oversold. It is called Open position.
Hedging is done to square off the open position.
 Mid Office deals with Risk Management.
Back Office takes care of settlement and Reconciliation.
FOREX RISKS AND DERIVATIVES
Foreign Exchange Risks  Exchange Risk (Transaction Exposure, Translation Exposure and
Operational Exposure)
 Settlement Risk
 Liquidity Risk
 Country Risk or Sovereign Risk
 Interest Rate Risk or Gap risk
 Operational Risk
 Legal Risk
 Buyer Risk, Seller Risk and Shipping Risk.
ICG (Internal control Overnight Limit Maximum exposure a bank can keep overnight
guidelines of RBI Day Light Limit : Maximum exposure a bank can expose at any time during a day.
Gap Limit: Maximum inter-period say a month exposure which a bank can keep.
Counter party limit
Country limit
Dealer limit
Stop Loss limit
Settlement limit
Deal Size limit
 Net Overnight Open Position (NOOPL) – for calculation of capital charge
on foreign exchange risk may be fixed by Board. Such limit should not
exceed 25% of total capital.
 Aggregate Gap limit (AGL) should not exceed 6% of total capital.
CCIL Clearing Corporation of India Limited is the institution created for clearing and
settlement of Forex deals amongst Primary dealers. It mitigates settlement Risks..
Both counter parties should be members of CCIL. It handles USD/INR deal
settlements with netted amounts.
Derivatives Instruments which reduce risk to an accepted level by future coverings are called
derivatives. Popular derivatives are:
1. Forward Contracts
2. Futures
3. Options
4. Swaps
Forward Contract It is a derivative product in which seller agrees to deliver goods on some future date
at fix price. The Quantity and delivery date is fixed as per requirements suited
to the party. These are OTC products.
Forward differentials are calculated on the basis of difference in interest rates of
countries of currency.
Currency with lower interest would be at a premium and currency with higher
interest will be at a discount in future.
Futures It is a derivative product that is based on agreement to buy or sell an asset at certain
 price in Future.
Futures are standardized contracts with regard to quantity and Delivery date
only. The delivery is not must. Margin is kept each day and it is adjusted. These
Futures are traded in Exchanges,
Difference between Futures and Forward Contracts
Forward Contract Futures
It is OTC (Over the Counter) Product It is Exchange traded product
It can be for any odd amount It is always for Standard amount
It can be for any Odd period It is always for Standard period
Delivery is essential Delivery is not must
Margin is not essential It is based on Margin requirement and Marked to
market
Options Option is Right to buy or sell an agreed quantity of currency or commodity without
obligation to do so. The buyer will exercise the option if market price is in favor or
otherwise option may be allowed to lapse.
Call Option
Right to buy at fixed price on or before fixed date.
Put Option
Right to sell at fixed price on or before fixed date.
 Final day on which it expires is called maturity.
CALL OPTION;
 If Strike price is below the spot price, the option is In the money.
 If Strike price is equal to the spot price, the option is At the money.
 If Strike price is above the spot price, the option is Out of money.
PUT OPTION
 If Strike price is more the spot price, the option is In the money.
 If Strike price is equal to the spot price, the option is At the money.
 If Strike price is less than spot price, the option is Out of the money.
American Option
Option can be exercised on any day before expiry.
European Option
Option can be exercised on maturity only.
Swap Transactions - Foreign Exchange transactions where one currency is sold and purchased for
another simultaneously.
Swap Deal may involve:
1. Simultaneous purchase of spot and sale of forward or vice versa.
2. Simultaneous sale and purchase, both forward but for different maturities. It
is called “Forward to Forward Swap”.
Conditions of Swap Deal:
 There should be simultaneous buying and selling of same foreign currency
of same value for different maturities.
  The deal should be concluded with the understanding between the banks
that it is Swap Deal.
 Buying and Selling is done at same rate. Only Forward margin enters into
the deal as a Swap difference.
Example:
PNB approaches UCO bank to quote its Swap rate for spot to 3months. UCO bank
has to sell spot and buy forward. Swap deal is at forward differential of Rs.
1.40/1.35. UCO bank will sell spot and buy forward at a discount of Rs.1.40
(Higher discount at purchase). Swap Difference will be at Discount of Rs.1.40.
CORRESPONDENT BANKING
Correspondent Banking It is a relationship between two banks which have mutual accounts with each other:
Nostro accounts “ Our account with you “
E.g. SBI Mumbai maintaining USD account with City Bank, New York
Vostro accounts “Your account with us”
E.g.. City Bank New York maintains Rupee account with SBI Ludhiana.
Loro account “His account with them”
E.g. City bank referring to Rupee account of Bank of America with SBI
Mumbai.
Mirror account ---- It is replica of Nostro account to reconcile.

What is Swift?
Society for Worldwide Interbank Financial Telecommunications. There are 8300
members of the society. Financial messages are sent through Swift. The messages
are automatically authenticated through BKE (Bilateral Key Exchange). It is
operational 24 hours and 365 days. Swift has now introduced new system of
authentication system wherein banks are required to have authentication key
exchanged between them through a set format by use of RMA (Relationship
Management Application). This is called BIC or Bank Identifier Code).
CHIPS – New York
Clearing House Inter Bank Payment System.
CHIPS is major payment system in USA with 48 members. The participants use the
system throughout the day for sending and receiving electronic payment
instructions. These are netted at end of the day and net position is debited or
credited to Nostro account of Federal Reserve.
It is used for Foreign Exchange Inter bank settlements and Euro Dollar Settlements.
FEDWIRE -USA
It is US payment system being operated by Federal Reserve Bank. It handles
majority of domestic payments. All US banks maintain account with Federal
Reserve Bank and are allotted ABA numbers to identify senders and receivers of
 payments.
CHAPS – London
Clearing House Automated Payment System
It is UK based Settlement System. It handles receipts and Payments in UK.
It has 16 member banks and 400 Indirect members.
TARGET
The full form of TARGET is Trans-European Automated Real-Time Gross
Settlement Express Transfer System. It is Euro Payment System which comprises of
15 national RTGS systems working in EUROPE. It process high value payments
from 30000 participating institutions across Europe.
RTGS-plus
RTGS plus has over 60 participants. It is a German Hybrid clearing system and
operating as a European oriented RTGS and Payment system.
Who is Resident A person who resides in India for more than 182 days during preceding financial
Indian? Who is Non- year is Resident Indian. A person who is not resident is Non- Resident.
Resident
Who is NRI? A person who is citizen of India but resides outside India owing to:
 Employment, Business, vocation-------indicating indefinite period of stay
outside.
 Work abroad on assignment with Foreign Govt., UNO, and IMF etc.
 Deputation officially.
 Study abroad.
PIO - Persons of Indian PIO is a person who is citizen of any other country, but he at any time:
Origin  Held Indian Passport
 He or his grand-parents or grand grand parents were Indian citizens by
virtue of constitution of India or under Indian Citizenship Act.
 The person is spouse of Indian Citizen.
OCB – Overseas OCBs are firms, Cos, Society owned directly or indirectly to the extent of at-least
Corporate Bodies 60% by NRIs.
It also includes overseas trusts where at-least 60% irrevocable beneficial interest is
held by non-residents directly or indirectly.
 Features of various Deposit Schemes available for Non-Resident Indians (NRIs)

Particulars Foreign Currency Non-Resident Non-Resident Ordinary

(Non-Resident) (External) Rupee Rupee Account Scheme
Account (Banks) Account Scheme [NRO Account]
Scheme [FCNR (B) [NRE Account]
Account]
(1) (2) (3) (4)
Who can open an NRIs (individuals / NRIs (individuals / Any person resident
account entities of Bangladesh / entities of Bangladesh / outside India (other than a
Pakistan nationality / Pakistan person resident in Nepal
ownership require prior nationality/ownership and Bhutan). Individuals /
approval of RBI) require prior approval of entities of Pakistan
RBI) nationality / ownership,
entities of
Bangladesh2 ownership
and erstwhile Overseas
Corporate Bodies5 require
prior approval of the
Reserve Bank.
Joint account In the names of two or In the names of two or May be held jointly with
more non-resident more non-resident residents
individuals provided all individuals provided all
the account holders are the account holders are
persons of Indian persons of Indian
nationality or origin; nationality or origin;

Resident close relative Resident close relative

(relative as defined in (relative as defined in
Section 6 of the Section 6 of the
Companies Act, 1956) Companies Act, 1956)
on ‘former or survivor’ on ‘former or survivor’
basis. The resident basis. The resident
close relative shall be close relative shall be
eligible to operate the eligible to operate the
account as a Power of account as a Power of
Attorney holder in Attorney holder in
accordance with extant accordance with extant
instructions during the instructions during the
life time of the NRI/ PIO life time of the NRI/ PIO
account holder. account holder.
Nomination Permitted Permitted Permitted
Currency in Any permitted currency Indian Rupees Indian Rupees
which account is i.e. a foreign currency
denominated which is freely
convertible
Repatriablity Repatriable Repatriable Not repatriable except for
the following:
i) all current income and ii)
up to USD 1 (one) million
per financial year (April-
March), by A NRI/ PIO.
Type of Account Term Deposit only Savings, Current, Savings, Current,
Recurring, Fixed Recurring, Fixed Deposit
Deposit
Period for fixed For terms not less than From one to three As applicable to resident
deposits 1 year and not more years, However, banks accounts.
than 5 years. are allowed to accept
NRE deposits above
three years from their
Asset-Liability point of
view
Rate of Interest With effect from March With effect from March Banks are free to
1, 2014 (i)deposits of 1 1, 2014, interest rates determine their interest
year to less than 3 year offered by banks on rates on savings deposits
maturity, interest shall NRE deposits cannot be under Ordinary Non-
be paid within the ceiling higher than those Resident (NRO) Accounts.
rate of LIBOR/ SWAP offered by them on However, interest rates
rates plus 200 basis comparable domestic offered by banks on NRO
points; (ii) deposits of 3- rupee deposits. deposits cannot be higher
5 years maturity, than those offered by them
interest shall be paid on comparable domestic
within the ceiling rate of rupee deposits.
LIBOR/ SWAP rates
plus 300 basis points

On floating rate
deposits, interest shall
be paid within the ceiling
of SWAP rates for the
respective currency
/maturity plus 200 bps/
300 bps as the case
may be. For floating rate
deposits, the interest
reset period shall be six
months.
Operations by Operations in the Operations in the Operations in the account
Power of account in terms of account in terms of in terms of Power of
Attorney in Power of Attorney is Power of Attorney is Attorney is restricted to
favour of a restricted to withdrawals restricted to withdrawals withdrawals for permissible
resident by the for permissible local for permissible local local payments in rupees,
non-resident payments or remittance payments or remittance remittance of current
account holder to the account holder to the account holder income to the account
himself through normal himself through normal holder outside India or
banking channels. banking channels. remittance to the account
holder himself through
normal banking channels.

Remittance to the NRI/ PIO

account holder is subject to
the ceiling of USD 1 (one)
million per financial year.
Loans
a. In India
i) to the Account Permitted without any Permitted without any Permitted subject to the
holder ceiling subject to usual ceiling subject to usual extant rules3
margin requirements. margin requirements
ii) to Third Permitted without any Permitted without any Permitted, subject to
Parties ceiling subject to usual ceiling subject to usual conditions4
margin requirements. margin requirements.
b. Abroad
i) to the Account Permitted without any Permitted without any Not Permitted
holder ceiling subject to usual ceiling subject to usual
margin requirement margin requirement
ii) to Third Permitted without any Permitted without any Not Permitted
Parties ceiling subject to usual ceiling subject to usual
margin requirements. margin requirements.
c. Foreign
Currency Loans
in India
i) to the Account Permitted without any Permitted without any
holder ceiling subject to usual ceiling subject to usual Not Permitted
margin requirements. margin requirements.

ii) to Third Permitted without any Permitted without any Not Permitted
Parties ceiling subject to usual ceiling subject to usual
margin requirements margin requirements
Purpose of Loan
a. In India
i) to the Account i) Personal purposes or i) Personal purposes or Personal requirement and /
holder for carrying on business for carrying on business or business purpose.*
activities * activities.*

ii) Direct investment in ii) Direct investment in

India on non-repatriation India on non-repatriation
basis by way of basis by way of
contribution to the contribution to the
capital of Indian firms / capital of Indian firms /
companies companies.

iii) Acquisition of flat / iii) Acquisition of flat /

house in India for his house in India for his
own residential use. own residential use.
(Please refer to para 9 (Please refer to para
of Schedule 2 to FEMA 6(a) of Schedule1 to
5). FEMA 5).
ii) to Third Fund based and / or Fund based and / or Personal requirement and /
Parties non-fund based facilities non-fund based facilities or business purpose *
for personal purposes or for personal purposes or
for carrying on business for carrying on business
activities *. (Please refer activities *. (Please refer
to para 9 of Schedule 2 to para 6(b) of Sch. 1 to
to FEMA 5). FEMA 5)
b. Abroad Fund based and / or Fund based and / or Not permitted.
To the account non-fund based facilities non-fund based facilities
holder and Third for bonafide purposes. for bonafide purposes.
Parties

* The loans cannot be utilised for the purpose of on-lending or for carrying on agriculture or
plantation activities or for investment in real estate business.

EXCHANGE
 EARNERS’ FOREIGN CURRENCY (EEFC) ACCOUNT
EXCHANGE EARNERS’ FOREIGN
CURRENCY (EEFC) ACCO
NT
The facility of EEFC scheme is intended to enable exchange earners to save on conversion /
transaction costs while undertaking forex transactions. This facility is not intended to enable
exchange earners to maintain assets in foreign currency, as India is still not fully convertible
on Capital Account.
ELIGIBILITY:
a)A person resident in India may open with, an AD Category – I bank in India, an account in
foreign currency called the Exchange Earners’ Foreign Currency (EEFC) Account, in terms
of Regulation 4 of the Foreign Exchange Management (Foreign Currency Account by a
Person Resident in India) Regulations, 2000.
b)Resident individuals are permitted to include resident close relative(s) as defined in the
Companies Act 1956 as a joint holder(s) in their EEFC bank a/cs on former or survivor basis.
NATURE OF ACCOUNT:
a)The account shall be maintained only in the form of noninterest bearing current
account.
b)No credit facilities, either fund-based or non-fund based, shall be permitted against the
security of balances held in EEFC a/cs by AD Category–I banks.
c)All categories of foreign exchange earners are allowed to credit 100% of their foreign
exchange earnings to their EEFC Accounts subject to the condition that:
The sum total of the accruals in the account during a calendar month should be converted
into Rupees on or before the last day of the succeeding calendar month after adjusting for
utilization of the balances for approved purposes or forward commitments.
These provisions apply also to holder of either a Resident Foreign Currency Account
(Domestic) or a Diamond Dollar Account (DDA).
ELIGIBLE CREDITS:
a) Inward remittance received through normal banking channel, other than the remittance
received pursuant to any undertaking given to the RBI or which represents foreign currency
loan raised or investment received from outside India or those received for meeting specific
obligations by the A/c holder.
b) Payments received in foreign exchange by a unit in Domestic Tariff Area (DTA) for
supplying goods to a unit in Special Economic Zone out of its foreign currency account.
c) AD Category – I banks may permit their exporter constituents to extend trade related
loans / advances to overseas importers out of their EEFC balances without any ceiling
subject to compliance of extant guidelines.
d) AD Category–I banks may permit exporters to repay packing credit advances whether
availed in Rupee or in foreign currency from balances in their EEFC a/c and / or Rupee
resources to the extent exports have actually taken place.

DIAMOND DOLLAR ACCOUNT (DDA) SCHEME:

The Diamond Dollar Account scheme has been introduced to facilitate growth in exports and
achieve the target to double India’s exports in goods and services from $465 billion to $900
billion and upping the Indian share of the world exports from the current 2% to 3.5% over the
next five years.
ELIGIBILITY:
a) Firms and companies dealing in purchase / sale of rough or cut and polished diamonds /
precious metal jewellery plain, minakari and / or studded with / without diamond and / or
other stones, with a track record of at least 2 years in import / export of diamonds / colored
gemstones / diamond and colored gemstones studded jewellery / plain gold jewellery.
b) Having an average annual turnover of Rs. 3 crores or above during the preceding three
licensing years (licensing year is from April to March).
c) They may be allowed to open not more than five Diamond Dollar Accounts with their
banks.
d) Eligible firms and companies may apply for permission to their AD Category – I banks in
the format prescribed.
e) AD Category-I banks are required to submit quarterly reports to the Foreign Exchange
Department, Reserve Bank of India, giving details of name and address of the firm /
company in whose name the DDA is opened, along with the date of opening / closing the
DDA, by the 10th of the month following the quarter to which it relates.
f) AD Category - I banks are required to submit a statement giving the data on the DDA
balances maintained by them on a fortnightly basis within seven days of close of the fortnight
to which it relates, to RBI.
BENEFITS:
Permissible Credits:
Amount of pre-shipment and post-shipment finance availed in US Dollars.
Realisation of export proceeds from shipments of rough, cut, polished diamonds and
diamond studded jewellery.
Realisation in US Dollars from local sale of rough, cut & polished diamonds.
Permissible Debit:
Payment for import / purchase of rough diamonds from overseas / local sources.
Payment for purchase of cut and polished diamonds, coloured gemstones and plain gold
jewellery from local sources.
Payment for import/purchase of gold from overseas / nominated agencies and
repayment of USD loans availed from the bank. Transfer to rupee account of the exporter.
The above transactions are subject to the provisions of Foreign Trade Policy of Government
of India, issued from time to time.

Resident Foreign Currency Account – RFC Account

1. A person resident in India is permitted to open a RFC account with an AD bank in India
out of forex received or acquired by him:
a) as pension or superannuation benefits from his overseas employer;
b) by converting assets which were acquired by him when he was a non-resident or
inherited from or gifted by a person resident outside India and repatriated to India;
c) before July 8, 1947 or any income arising or accruing thereon which is held outside India
in pursuance of a general or special permission granted by the Reserve Bank;
d) received as proceeds of LIC claims/ maturity/ surrendered value settled in forex from an
Indian insurance company permitted to undertake life insurance business by the Insurance
Regulatory and Development Authority.
2) The balances in the RFC account are free from all restrictions regarding utilisation of
foreign currency balances outside India.
3) Such accounts can be held jointly with resident relative as joint holder on ‘former or
survivor’ basis. However, such resident Indian relative joint account holder cannot operate
the account during the life time of the resident account holder.
4) The balances in the Non-Resident External (NRE) Account and Foreign Currency Bank
[FCNR (B)] Account can be credited to the RFC account when the residential status of the
non-resident Indian (NRI) changes to that of a Resident.
5) This account can be in the form of a term deposit, saving bank or current account.

Resident Foreign Currency (Domestic) - RFC (D) A/c

1) A resident individual may open an RFC(D) account to retain in a bank account in India,
the forex acquired in the form of currencynotes, bank notes and travellers cheques from
overseas sources such as:
a) payment while on a visit abroad for services not arising from any business or anything
done in India;
 b) honorarium or gift or for services rendered or in settlement of any lawful obligation from
any person not resident in India and who is on a visit to India;
c) honorarium or gift while on a visit to any place outside India;
d) gift from a relative;
e) unspent foreign exchange acquired from an authorised person for travel abroad;
f) representing the disinvestment proceeds received by the resident account holder on
conversion of shares held by him to ADRs/ GDRs under the ADR/GDR Scheme approved by
the
Government of India;
g) by way of earnings received as the proceeds of life insurance policy claims/ maturity/
surrender values settled in foreign currency from an insurance company in India permitted
to undertake life insurance business by the Insurance Regulatory and Development
Authority
2) The sum total of the accruals in the account during a calendar month should be
converted into Rupees on or before the last day of the succeeding calendar month after
adjusting for utilization of the balances for approved purposes or forward commitments.
3) Balances in the account can be used for any current or capital account transactions in
accordance with the provisions of the Foreign Exchange Management (Current Account
Transactions) Rules, 2000 or the Foreign Exchange Management (Permissible Capital
Account Transactions) Regulations, 2000, respectively.
4) Balances may be credited to NRE/ FCNR (B) Accounts, at the option/ request of the
account holders consequent upon change of their residential status from resident to non-
resident.

LETTER OF CREDIT
LC is a document:
 Issued by Buyer’s bank at his request.
 Carrying undertaking to pay to the seller
 Upon presentation of documents evidencing shipping of goods.
 In compliance with terms and conditions.
ILC is Inland Letter of Credit and FLC is Foreign Letter of Credit. The parties to LC are as under:
Applicant Buyer or Importer
Beneficiary Seller or Exporter
Issuing Bank It is opening Bank which ultimately pays on behalf of importer in the
Importer’s country.
Advising Bank or Bank in Exporter Country through which LC is advised. It acts as agent
Notifying Bank without responsibility to pay unless it confirms.
Negotiating Bank or Bank in Exporter Country which makes payment to exporter or accepts Bill of
Nominated Bank Exchange.
Confirming Bank In Exporter’s country. It may be advising bank also if it adds confirmation.
This bank will be responsible for default, if any.
Reimbursing Bank The bank which re-imburses the negotiating bank. (Usually, it is the bank
having Nostro account of Opening Bank.
It is a publication of ICC (international Chamber of Commerce). It does not apply by default. There must be
special mention in LC about applicability of UCPDC – 600. It has 39 articles. Some of the important are here
under:
 Issuing Bank gets Reasonable time for acceptance/refusal of Documents which is 5 Banking days after
presentation.
 Bank to deal with documents and not with goods. Bank not to check quality of the goods. However
shipping documents must contain the particulars of commodity shipped which should match with LC.
 Bank is not concerned with underlying contract of buyer and seller.
 Courts refrain from passing injunction on complaint of importer regarding any discrepancy of goods.
 Amount of Bill may differ from LC amount ±10% (Tolerance limit)
 Quantity of Bill may differ from LC specification ±5% (Tolerance limit).
 Documents are original if it carries original signatures, stamp mark and label of issuer.
 Documents must be presented for negotiation within 21 Calendar days from date of Shipment. It
becomes stale thereafter.
 If expiry of LC falls on Public holiday, under such situations documents can be submitted on Preceding
banking day.
LC Type Features
Revocable It is an LC which can be amended or cancelled without consent of all parties. UCPDC
600 does not allow issue of such LC.
Irrevocable It is LC which cannot be cancelled or amended without consent of all parties.
Confirmed LC If confirmed by some bank in exporter country.
Transferable LC It can be transferred in Full or part by advising bank at the request of issuing bank.
ONLY ONCE
Red Clause LC It enables the beneficiary to avail pre-shipment credit
.
Green Clause Besides pre-shipment, advising bank can allow advance for storage and shipment.
Letter of Credit
Revolving LC Where bills are negotiated and LC is automatically renewed.
Back to Back LC Beneficiary Uses LC to open another LC in favor of local suppliers.
Standby LC It is issued in lieu of Guarantee. It is substitute of guarantee and is used in countries like
US where guarantees are not used.
 If nothing is mentioned, LC will be Irrevocable, non-transferable.
Documents under LC
1. Bill of exchange.
2. Invoice
3. Transport Documents: Bill of Lading & Airway Bill
4. Insurance Documents (Insurance is done at 110% of CIF value)
5. Certificate of Origin
Short Bill of Lading: Which does not carry detailed terms and conditions
Thorough Bill of Lading covers entire voyage with several modes of transport
Straight Bill of Lading is issued directly in the name of consignee.
Clause Bill of Lading: It bears super imposed clause that declared defective condition of Goods.
Clean Bill of Lading: It has no such super imposed clause declaring goods or packaging as defective.
It is incumbent upon the issuing bank to make payment immediately.
In case of sight documents, the issuing bank can hold documents for maximum period of 10 days. In case the
bill is not retired or paid within this period, the issuing bank will crystallize the liability on 10th day at Bill
Selling rate or the rate at which the contract was booked (whichever is higher)
In case of Usance bill, Forex liability will be crystallized on due date into Indian Rupees at Bill Selling rate or
Contracted Rate (which is higher)
INCOTERMS
Ex-Works
Exporter says that goods can be picked up from Factory. Exporter will not pay the freight. The transport cost and
risk will be borne by the Importer.
FCA (Main Freight Paid by Buyer)
Free Carrier means seller hands over the goods to first Carrier.
FAS (Main Freight Paid by Buyer)
Free alongside ship i.e. Goods will be delivered by exporter to shipping co.
FOB (Main Freight Paid by Buyer)
Free on Board (Say FOB Mangalore) means Goods will be loaded on ship/Aero plane (main carriage still
unpaid by the exporter)
CFR (Cost and Freight Paid by Seller)
Seller will pay cost and freight till destination
CIF (Cost, Insurance and Freight paid by Seller)
The cost, Insurance and Freight will be borne by seller.

 UCPDC does not apply by default. It is required to be mentioned on LC

 Shipping Documents can be dated prior to the date of LC. It means LC covers the shipping done prior to
the issue of letter of credit. But, the shipping done after expiry of LC is not permitted.

 On or about date means ±5 Calendar days. If it is mentioned on LC that date of credit is on or about
31.12.2015. This implies that date of expiry of LC can be after 5 calendar days after 31.12.2015.

HIGHLIGHTS OF THE FOREIGN TRADE POLICY 2015-2020

A. SIMPLIFICATION & MERGER OF REWARD SCHEMES

Export from India Schemes:

1. Merchandise Exports from India Scheme (MEIS)

(a) Earlier there were 5 different schemes (Focus Product Scheme, Market Linked Focus Product
Scheme, Focus Market Scheme, Agri. Infrastructure Incentive Scrip, VKGUY) for rewarding
merchandise exports with different kinds of duty scrips with varying conditions (sector specific or
actual user only) attached to their use. Now all these schemes have been merged into a single scheme,
namely Merchandise Export from India Scheme (MEIS) and there would be no conditionality
attached to the scrips issued under the scheme. The main features of MEIS, including details of
various groups of products supported under MEIS and the country groupings are at Annexure-1.
(b) Rewards for export of notified goods to notified markets under ‘Merchandise Exports 2 from India
Scheme (MEIS) shall be payable as percentage of realized FOB value (in free foreign exchange). The
debits towards basic customs duty in the transferable reward duty credit scrips would also be allowed
adjustment as duty drawback. At present, only the additional duty of customs / excise duty / service
tax is allowed adjustment as CENVAT credit or drawback, as per Department of Revenue rules.

2. Service Exports from India Scheme (SEIS)

(a) Served From India Scheme (SFIS) has been replaced with Service Exports from India Scheme
(SEIS). SEIS shall apply to ‘Service Providers located in India’ instead of ‘Indian Service Providers’.
Thus SEIS provides for rewards to all Service providers of notified services, who are providing
services from India, regardless of the constitution or profile of the service provider. The list of
services and the rates of rewards under SEIS are at Annexure-2.

(b) The rate of reward under SEIS would be based on net foreign exchange earned. The reward issued
as duty credit scrip, would no longer be with actual user condition and will no longer be restricted to
usage for specified types of goods but be freely transferable and usable for all types of goods and
service tax 3 debits on procurement of services / goods. Debits would be eligible for CENVAT credit
or drawback.

3. Chapter -3 Incentives (MEIS & SEIS) to be available for SEZs It is now proposed to extend
Chapter -3 Incentives (MEIS & SEIS) to units located in SEZs also.

4. Duty credit scrips to be freely transferable and usable for payment of custom duty, excise duty and
service tax. (a) All scrips issued under MEIS and SEIS and the goods imported against these scrips
would be fully transferable. (b) Scrips issued under Exports from India Schemes can be used for the
following:-

(i) Payment of customs duty for import of inputs / goods including capital goods, except items listed
in Appendix 3A.

(ii) Payment of excise duty on domestic procurement of inputs or goods, including capital goods as
per DoR notification.

(iii) Payment of service tax on procurement of services as per DoR notification.

(c) Basic Customs Duty paid in cash or through debit under Duty Credit Scrip can be taken back as
Duty Drawback as per DoR Rules, if inputs so imported are used for exports.

5. Status Holders

(a) Business leaders who have excelled in international trade and have successfully contributed to
country’s foreign trade are proposed to be recognized as Status Holders and given special treatment
and privileges to facilitate their trade transactions, in order to reduce their transaction costs and time.

(b) The nomenclature of Export House, Star Export House, Trading House, Star Trading House,
Premier Trading House certificate has been changed to One, Two, Three, Four, Five Star Export
House.
(c) The criteria for export performance for recognition of status holder have been changed from
Rupees to US dollar earnings. The new criteria is as under:- 5 Status category Export Performance
FOB / FOR (as converted) Value (in US $ million) during current and previous two years One Star
Export House 3 Two Star Export House 25 Three Star Export House 100 Four Star Export House 500
Five Star Export House 2000

(d) Approved Exporter Scheme - Self certification by Status Holders Manufacturers who are also
Status Holders will be enabled to self-certify their manufactured goods as originating from India with
a view to qualify for preferential treatment under different Preferential Trading Agreements [PTAs],
Free Trade Agreements [FTAs], Comprehensive Economic Cooperation Agreements [CECAs] and
Comprehensive Economic Partnerships Agreements [CEPAs] which are in operation. They shall be
permitted to self-certify the goods as manufactured as per 6 their Industrial Entrepreneur
Memorandum (IEM) / Industrial Licence (IL)/ Letter of Intent (LOI). B. BOOST TO "MAKE IN
INDIA"

6. Reduced Export Obligation (EO) for domestic procurement under EPCG scheme: Specific Export
Obligation under EPCG scheme, in case capital goods are procured from indigenous manufacturers,
which is currently 90% of the normal export obligation (6 times at the duty saved amount) has been
reduced to 75%, in order to promote domestic capital goods manufacturing industry.

7. Higher level of rewards under MEIS for export items with high domestic content and value
addition. It is proposed to give higher level of rewards to products with high domestic content and
value addition, as compared to products with high import content and less value addition. 7 C.
TRADE FACILITATION & EASE OF DOING BUSINESS

8. Online filing of documents/ applications and Paperless trade in 24x7 environment:

(a) DGFT already provides facility of Online filing of various applications under FTP by the
exporters/importers. However, certain documents like Certificates issued by Chartered Accountants/
Company Secretary / Cost Accountant etc. have to be filed in physical forms only. In order to move
further towards paperless processing of reward schemes, it has been decided to develop an online
procedure to upload digitally signed documents by Chartered Accountant / Company Secretary / Cost
Accountant. In the new system, it will be possible to upload online documents like annexure attached
to ANF 3B, ANF 3C and ANF 3D, which are at present signed by these signatories and submitted
physically.

(b) Henceforth, hardcopies of applications and specified documents would not be required to be
submitted to RA, saving paper as well as cost and time for the exporters. To start with, applications
under Chapter 3 & 4 of FTP are being covered (which account for nearly 70% of total applications in
DGFT). Applications 8 under Chapter-5 would be taken up in the next phase.

(c) As a measure of ease of doing business, landing documents of export consignment as proofs for
notified market can be digitally uploaded in the following manner:-

(i) Any exporter may upload the scanned copy of Bill of Entry under his digital signature.
(ii) Status holders falling in the category of Three Star, Four Star or Five Star Export House may
upload scanned copies of documents.

9. Online inter-ministerial consultations: It is proposed to have Online inter-ministerial consultations

for approval of export of SCOMET items, Norms fixation, Import Authorisations, Export
Authorisation, in a phased manner, with the objective to reduce time for approval. As a result, there
would not be any need to submit hard copies of documents for these purposes by the exporters.

10. Simplification of procedures/processes, digitisation and e-governance

(a) Under EPCG scheme, obtaining and submitting a certificate from an independent Chartered
Engineer, confirming the use of spares, tools, refractory and catalysts imported for final redemption of
EPCG authorizations has been dispensed with.

(b) At present, the EPCG Authorisation holders are required to maintain records for 3 years after
redemption of Authorisations. Now the EPCG Authorization Holders shall be required to maintain
records for a period of two years only. Government’s endeavour is to gradually phase out this
requirement as the relevant records such as Shipping Bills, e-BRC are likely to be available in
electronic mode which can be archived and retrieved whenever required.

(c) Exporter Importer Profile: Facility has been created to upload documents in Exporter/Importer
Profile. There will be no need to submit copies of permanent records/ documents (e.g. IEC,
Manufacturing licence, RCMC, PAN etc.) repeatedly with each application, once uploaded.

(d) Communication with Exporters/Importers: Certain information, like mobile number, e-mail
address etc. has been added as mandatory fields, in IEC data base. This information once provided by
exporters, would help in better communication with exporters. SMS/ email would be sent to exporters
to inform them about issuance of authorisations or status of their applications.

(e) Online message exchange with CBDT and MCA: It has been decided to have on line message
exchange with CBDT for PAN data and with Ministry of Corporate Affairs for CIN and DIN data.
This integration would obviate the need for seeking information from IEC holders for subsequent
amendments/ updation of data in IEC data base. (e) Communication with Committees of DGFT: For
faster and paperless communication with various committees of DGFT, dedicated email addresses
have been provided to each Norms Committee, Import Committee and Pre-Shipment Inspection
Agency for faster communication.

(f) Online applications for refunds: Online filing of application for refund of TED is being introduced
for which a new ANF has been created.

11. Forthcoming e-Governance Initiatives

(a) DGFT is currently working on the following EDI initiatives:

(i) Message exchange for transmission of export reward scrips from DGFT to Customs.

(ii) Message exchange for transmission of Bills of Entry (import details) from Customs to DGFT.
(iii) Online issuance of Export Obligation Discharge Certificate (EODC).

(iv) Message exchange with Ministry of Corporate Affairs for CIN & DIN.

(v) Message exchange with CBDT for PAN.

(vi) Facility to pay application fee using debit card / credit card.

(vii) Open API for submission of IEC application.

(viii) Mobile applications for FTP 12 D. Other new Initiatives

12. New initiatives for EOUs, EHTPs and STPs

(a) EOUs, EHTPs, STPs have been allowed to share infrastructural facilities among themselves. This
will enable units to utilize their infrastructural facilities in an optimum way and avoid duplication of
efforts and cost to create separate infrastructural facilities in different units.

(b) Inter unit transfer of goods and services have been allowed among EOUs, EHTPs, STPs, and
BTPs. This will facilitate group of those units which source inputs centrally in order to obtain bulk
discount. This will reduce cost of transportation, other logistic costs and result in maintaining
effective supply chain.

(c) EOUs have been allowed facility to set up Warehouses near the port of export. This will help in
reducing lead time for delivery of goods and will also address the issue of unpredictability of supply
orders.

(d) STP units, EHTP units, software EOUs have been allowed the facility to use all duty free
equipment/goods for training purposes. This will help these units in developing skills of their
employees.

(e) 100% EOU units have been allowed facility of supply of spares/ components up to 2% of the value
of the manufactured articles to a buyer in domestic market for the purpose of after sale services.

(f) At present, in a period of 5 years EOU units have to achieve Positive Net Foreign Exchange
Earning (NEE) cumulatively. Because of adverse market condition or any ground of genuine
hardship, then such period of 5 years for NFE completion can be extended by one year. Time period
for validity of Letter of Permission (LOP) for EOUs/EHTP/ STPI/BTP Units has been revised for
faster implementation and monitoring of projects. Now, LOP will have an initial validity of 2 years to
enable the unit to construct the plant and install the machinery. Further extension can be granted by
the Development Commissioner up to one year. Extension beyond 3 years of the validity of LOP, can
be granted, in case unit has completed 2/3rd of activities, including the construction activities.

(g) At present, EOUs/EHTP/STPI units are permitted to transfer capital goods to other EOUs, EHTPs,
STPs, SEZ units. Now a facility has been provided that if such 14 transferred capital goods are
rejected by the recipient, then the same can be returned to the supplying unit, without payment of
duty.
(h) A simplified procedure will be provided to fast track the de-bonding / exit of the STP/ EHTP units.
This will save time for these units and help in reduction of transaction cost.

(i) EOUs having physical export turnover of Rs.10 crore and above, have been allowed the facility of
fast track clearances of import and domestic procurement. They will be allowed fast tract clearances
of goods, for export production, on the basis of preauthenticated procurement certificate, issued by
customs / central excise authorities. They will not have to seek procurement permission for every
import consignment.

13. Facilitating & Encouraging Export of dual use items (SCOMET).

(a) Validity of SCOMET export authorisation has been extended from the present 12 months to 24
months. It will help industry to plan their activity in an orderly manner and obviate the need to seek
revalidation or relaxation from DGFT.

(b) Authorisation for repeat orders will be considered on automatic basis subject to certain conditions.

(c) Verification of End User Certificate (EUC) is being simplified if SCOMET item is being exported
under Defence Export Offset Policy. Outreach programmes will be conducted at different locations to
raise awareness among various stakeholders.

14 Facilitating & Encouraging Export of Defence Exports

(a) Normal export obligation period under advance authorization is 18 months. Export obligation
period for export items falling in the category of defence, military store, aerospace and nuclear energy
shall be 24 months from the date of issue of authorization or co-terminus with contracted duration of
the export order, whichever is later. This provision will help export of defence items and other high
technology items.

(b) A list of military stores requiring NOC of Department of Defence Production has been notified by
DGFT recently. A committee has been formed to create ITC (HS) codes 16 for defence and security
items for which industrial licenses are issued by DIPP.

15. e-Commerce Exports

(a) Goods falling in the category of handloom products, books / periodicals, leather footwear, toys and
customized fashion garments, having FOB value up to Rs.25000 per consignment (finalized using
eCommerce platform) shall be eligible for benefits under FTP. Such goods can be exported in manual
mode through Foreign Post Offices at New Delhi, Mumbai and Chennai.

(b) Export of such goods under Courier Regulations shall be allowed manually on pilot basis through
Airports at Delhi, Mumbai and Chennai as per appropriate amendments in regulations to be made by
Department of Revenue. Department of Revenue shall fast track the implementation of EDI mode at
courier terminals.

16. Duty Exemption

(a) Imports against Advance Authorization shall also be eligible for exemption from Transitional
Product Specific Safeguard Duty.

(b) In order to encourage manufacturing of capital goods in India, import under EPCG Authorisation
Scheme shall not be eligible for exemption from payment of anti-dumping duty, safeguard duty and
transitional product specific safeguard duty.

17. Additional Ports allowed for Export and import Calicut Airport, Kerala and Arakonam ICD, Tamil
Nadu have been notified as registered ports for import and export.

18. Duty Free Tariff Preference (DFTP) Scheme India has already extended duty free tariff preference
to 33 Least Developed Countries (LDCs) across the globe. This is being notified under FTP.

19. Quality complaints and Trade Disputes

(a) In an endeavour to resolve quality complaints and trade disputes, between exporters and importers,
a new chapter, namely, Chapter on Quality Complaints and Trade Disputes has been incorporated in
the Foreign Trade Policy.

(b) For resolving such disputes at a faster pace, a Committee on Quality Complaints and 18 Trade
Disputes (CQCTD) is being constituted in 22 offices and would have members from
EPCs/FIEOs/APEDA/EICs. 20. Vishakhapatnam and Bhimavaram added as Towns of Export
Excellence Government has already recognized 33 towns as export excellence towns. It has been
decided to add Vishakhapatnam and Bhimavaram in Andhra Pradesh as towns of export excellence
(Product Category– Seafood)

Status Holder
(a) Status Holders are business leaders who have excelled in international trade and have successfully
contributed to country’s foreign trade. Status Holders are expected to not only contribute towards
India’s exports but also provide guidance and handholding to new entrepreneurs.
(b) All exporters of goods, services and technology having an import-export code (IEC) number shall
be eligible for recognition as a status holder. Status recognition depends upon export performance. An
applicant shall be categorized as status holder upon achieving export performance during current and
previous two financial years, as indicated in paragraph 3.21 of Foreign Trade Policy. The export
performance will be counted on the basis of FOB value of export earnings in free foreign exchange.
(c) For deemed export, FOR value of exports in Indian Rupees shall be converted in US$ at the
exchange rate notified by CBEC, as applicable on 1st April of each Financial Year.
(d) For granting status, export performance is necessary in at least two out of three years.
Status Category

Diamond & Jewellery Dollar Accounts

(a) Firms and companies dealing in purchase / sale of rough or cut and polished diamonds / precious
metal jewellery plain, minakari and / or studded with / without diamond and / or other stones with a
track record of at least two years in import or export of diamonds / coloured gemstones / diamond and
coloured gemstones studded jewellery / plain gold jewellery and having an average annual turnover of
Rs.3 crore or above during preceding three licensing years may also carry out their business through
designated Diamond Dollar Accounts (DDA).
(b) Dollars in such accounts available from bank finance and / or export proceeds shall be used only
for:
(i) Import / purchase of rough diamonds from overseas/ local sources;
(ii) Purchase of cut and polished diamonds, coloured gemstones and plain gold jewellery from local
sources;
(iii) Import / purchase of gold from overseas / nominated agencies and repayment of dollar loans from
the bank; and
(iv) Transfer to Rupee Account of exporter. Details of this DDA Scheme are given in Handbook of
Procedures.
(c) A non DDA holder is also permitted to supply cut and polished diamonds to DDA holder, receive
payment in dollars and convert the same into Rupees within 7 days. Cut and polished diamonds and
coloured gemstones so supplied by non-DDA holder will also be counted towards discharge of his
export obligation and/ or entitle him to replenishment Authorisation.
Benefits for Deemed Exports
Deemed exports shall be eligible for any / all of following benefits in respect of manufacture and
supply of goods, qualifying as deemed exports, subject to terms and conditions as given in HBP and
ANF-7A:

(a) Advance Authorisation / Advance Authorisation for annual requirement / DFIA.

(b) Deemed Export Drawback.
(c) Refund of terminal excise duty, if exemption is not available.
 RECOVERY TOOLS

LOKADALAT

 Created under Legal Services Authority Act 1987.

 Decision are consent decree and cannot be appealed against.
 Civil Procedure Code is applicable. They are civil courts.
 Banks can call Lok Adalt with application to High Court.
 Amount - Normal Lok Adalt : Up to Rs.20 lac (wef Aug03, 2004)
 Above the aforesaid cut-off of RS.20 lac - DRT Lok Adalat.
 Eligible accounts - NPA (Loss and doubtful).
 Decree for principal and interest should be sought.
 After full payment clischarge should be given:
 Repayment: Preferably down-payment. Max in 1-3 years.

(SARFAESI ACT) 2002

Securitisation & Reconstruction Of Financial Assets and Enforcement of Security Interest Act 2002
 Applicable wef Aug 23, 2002 in entire India, including J&K. (Act amended in 2004 on Supreme
Court
. intervention in Mardia Chemicals vs Union of India and others).
 Rights of bank - To take possession, take over management, appoint manager, recover money
receivable from 3rd parties.
. .
 Authorised officer - Scale IV and above in banks OR officers approved by BoD of the bank.
 ConsortiumIBIFR cases : In case of joint/consortium financing consent of 60% (by value) creditors
required for action. BIFR cases can be recalled back with consent of 75% of creditors

Loans not eligible - (a) Amount up to RS.l lac, (b) agricultural land cannot be sold, (c) pledge &
lien (d)
recovery up to 80% of due amount already affected (e) limitation expired. Possession - 60 days
notice before possession. >
 Remedy to borrower - If borrower objects, bank to send reply within 15 days borrower still not
satisfied
could approach DRT within 45 days without deposit.ofany amount. ,
 DRT's decision is appealable (within 30 days)before DRAT after deposit of 50% of amount that
could be reduced to 25% by DRAT.
 Sale - Before sale 30 days notice. Sale price min at reserve price to be fixed by bank. Below
reserve price consent of the borrower. Sale by public tenders or through public auction. If sale
through public auction, public notice in two news papers (one of which regional) Sale is confirmed
by bank on receipt of 25% amount immdly and balance is payable in 15 days.
 DRT pending case: Banks can make use of SARFAESI Act for sale of security for such cases
(Transcorevs Union of India).
DEBT RECOVERY TRIBUNAL

 Created under Recovery of Debt Due to Banks & FIs Act 1993 (except JK). These are like other
civil courts for a special purpose of helping in quicker NPA recovery in large account.
 DRT headed by President (President assisted by Registrar and Recovery Officer) and DRAT by
Chairperson
 Eligible account - Loans of banks and FIs with recoverable dues of Rs.10 lac or more.
 Jurisdiction: No other court has jurisdiction over such cases.
 Time limit - On receipt of application, show cause notice within 30 days. Disposal is expected in
180 days.
Disposal of appeal by DRAT also maximum 180 days .
• ' Appeal - Order by DRT appealable (by bank Of borrower) to DRAT within 45 days from date of
receipt after. Borrower to deposit 75% of due amount. bRAT may reduce or waive the amount.
 Order- After claim is upheld, Recovery certificate is issued. Recovery officer has powers such as
 attachment etc. under Income Tax Act.
 Appeal to President of DRT against order of Recovery Officer within 30 days and appeal against
Registrar within 15 days.
 Fee. - Rs.12000. For eacb- additionalcRs.1 lac Rs.1000 •. Max 1.50 lac. For appeal Rs.12000
for debt less than Rs.10 lac, , 20000/- (l0 lac to-less than Rs.30Lac} and:Rs.30000(Rs.30Iac&-
above);

ASSET RECONSTRUCTION COMPANIES

 Set up for taking over distressed assets from banks/FIs and reconstruct or re-pack for sale.
Recovery plan should be maximum of 5 years (3 years with permission of BoD).
 (First ARC - ARCIL).
 To be set up as ajoint stock company. RBI registration must before commencement for business
as ARC.
 Business to be commenced within 6 months of registration with RBI. RBI can extend it by another
1 year in aggregate.
 Net worth not less Rs.I 00 cr or 15% of acquired assets, whichever lower.
 Capital adequacy ratio min 15% of Risk Weighted Assets.
 ARC to invest at least 5% in security receipts created out of each securitization.

CORPORATE DEBT RESTRUCTURING SYSTEM

 A mechanism outside BIFR or DRT. Not a judicial system, based on mutual agreement. Before a
reference to CDR, 2 agreements required i.e. debtor-creditor agreement and inter-creditor
agreement.
 3-tier Structure: CDR Forum (at top - policy making having Chairman of banks as members),
CDR
Empowered Group (sanctioning authority having EDs of banks as members) and CDR Cell
(operating wing).
 Eligible: (a) Corporate account (b) Multi-lender alc (c) Fund/non-fund exposure - Rs.10 cr or more.
 Reference for Category I accounts (Standard & Substandard accounts) by a creditor with 20%
share (by value). (If DF is up to 10% of total exposure, it is to be part of category I CDR)
 Category II accounts (Doubtful account) reference jointly by creditors with 75% shares by value &
60% by number.
 Suit filed alc eligible with consent of 75% creditors by value & 60% by number.
Fraud & willful default cases not also eligible. Large value BIFR cases, can be taken up on specific
recommendation of CDR core group.

 Stand still clause - Debtor & creditors to sign Debtor-Creditor agreement, for no legal action for
90 days (extendable to 180 days).
 Creditors to enter into Inter-creditor Agreement, valid for 3 years.
 Benchmarks - Unit to become viable in 5 years (infrastructure 8 years) and restructured debt
should be paid within 10 years.

i. ROCE at least equivalent to 5 year Govt. security yield plus 2%.

ii. DSCR greater than 1.25 within 5 years period. On year-to-year basis, above 1. Normal D$CR
for 10 years repayment, should be around 1.33.
iii. GilP between IRR and cost of capital, should be at least 1%.
iv. Loan life ratio (LLR) should be 1.4 (to give a cushion of 40% to the amount of loan to be
serviced). LLR = Present value of total available cash flow during the loan life perlod (including
interest and principal) I Maximum amount of loan

Promoter contribution: At least 20% of sacrifice of lenders or 2% of the restructured debt,

whichever is higher, to be brought upfront.
 Implementation on approval: Decision binding on all creditors where 75% by value and 60% by
number agree.
Asset classification: If approved package implemented within 4 months, asset classification at the time
of reference, to be restored.
 DEBT RESTRUCTURING - SME

 Eligible - (a) All non-corporate SMEs. (b) All Corporate SMEs enjoying limits from single bank. (c)
For corporate multiple banking accounts funded and non-funded o/s up to RS.l 0 cr.
 Viability criteria - Unit to become viable in 7 years and restructured debt should be paid within 10
years.
 Additional finance to treated standard for] 2 months initially after the date when first payment of
interest or of principal falls due under the approved structure. Subsequently classification to be
based on record of recovery .
 Asset classification: During the specified period of one year, the asset classification status of
rescheduled accounts would not deteriorate if satisfactory performance of account is
demonstrated .
.• Time schedule: 90 days.

SALE & PURCHASE OF NPA BY BANKS

 Guidelines applicable to banks,_FIs and NBFCs.·

 Time for realisation of purchased NPAs -3 years . Not less than 10% should be recovered in first
year and 5% in each following HY.
 Minimum age of NPA in the books of selling bank – without any initial holding period (earlier it
was 2 years).
 Seller bank can sell (a) on cash basis (b) on without recourse basis and (c) cannot re-purchase
the sold account.
 Minimum period the purchasing bank is to keep the account with it, if it wants to sell to another
bank: 12 month from date of purchase. (Earlier it was 15 months)
 Asset classification of NPA by purchaser bank - For first 90 days, it will be treated standard. If
recovery is not as planned, the treatment to be given as sub-standard.
 For CAR purposes, for purchased NPA risk weightage = 100%.
 GIST OF CIRCULARS W.E.F. 01.01.2016 TO 31.03.2016

MSME DIVISION
SCHEME FOR FINANCING Detailed guidelines on the captioned scheme have been
MSME AGAINST PLEDGE OF issued under Circular No. 57/2014 dated 01-08-2014
CIRCULAR No. WAREHOUSE RECEIPTS - followed by various circulars from time to time. Vide
2 /2016 CHANGE IN THE NAME OF Circular No 60 /2015 dated 19.10.2015 guidelines regarding
COLLATERAL the Tie Up arrangement of the Bank with Collateral
MANAGEMENT COMPANY Management Company Edelweiss Integrated Commodity
FROM “EDELWEISS Management Limited (EICML) were issued.
INTEGRATED COMMODITY Now M/S Edelweiss Integrated Commodity has informed
MANAGEMENT LIMITED”
that their name has been changed to Edelweiss Agri Value
TO “EDELWEISS AGRI
VALUE CHAIN LTD” Chain Limited.
MSME DIV. PNB NURTURE: SCHEME In order to give focused attention to women entrepreneurs
CIRCULAR FOR FINANCING DAY under this activity & to increase our share of MSME
NO. 03/2016 CARE ENTRES/CRECHES advances, we have formulated this scheme, PNB
AND RELATED ACTIVITIES NURTURE for financing day care centres / crèches and
EXCLUSIVELY FOR related
WOMEN ENTREPRENEURS activities for employment and income generation
exclusively for women entrepreneurs, to augment / catalyze
micro financing with an aim to tap vast
business potential available in this segment.
EXTENT OF LOAN: Upto Rs. 2.00 lakh
TYPE OF FACILITY:
Term Loan / WC in shape of OD – Need based, subject to
maximum of Rs. 2.00 lakh
MARGIN: NIL
RATE OF INTEREST
Upto Rs 50,000/- : B.R. (presently @ 9.60%)
Above Rs. 50,000/- to Rs 2.00 lakh : B.R. plus 2% p.a. plus
TP.
Circular New Interest Table Codes :- For Attention of all incumbents is invited to HO: IRMD Cir. No.
No.ITD/CBS/02 MSE 117/2015 dated 11-12-2015 whereby Interest Rates for MSE
/2016 Category of Borrowers Covered Category of Borrowers Covered under CGTMSE were
under CGTMSE circulated as under:-
MSE Maximum Int. Revised ROI
Advances rate
cap as per
CGTMSE
up to Rs. BR+4% BR*
 50,000/-
>Rs. 50,000 BR + 2.00%
to Rs. 20 lac
> Rs. 20 lac A1: BR+1.00%
to Rs 100 A2: BR+1.25%
lac A3: BR+1.50%
A4: BR+1.75%
B1: BR+2.25%
B2: BR+2.75%
B3: BR+3.25%
C1: BR+3.75%
MSME MODIFICATION IN TIME It has now been decided that CGTMSE will strictly adhere
CIRCULAR LINES FOR DELAY IN
to the time lines for reporting of NPAs as indicated in
NO.04/2016 MARKING OF NPA IN
CGTMSE PORTAL CGTMSE extant guidelines. All circle offices are requested
to approach CGTMSE for marking all those accounts as
NPAs, latest by February 29, 2016, which have not been
marked by them within the prescribed time period. COs may
note that this is a one-time measure and CGTMSE may not
allow any further extension to update the NPA details in its
portal in respect of those accounts where the NPAs have not
been marked in CGTMSE portal within the stipulated time
period.
All the requests of delay in NPA marking may be forwarded
to email id npa@cgtmse.in along with the scanned copy of
the request letter duly signed by the officer not below the
rank of AGM. CGTMSE will not entertain any emails
without the attachment of the scanned letter for the request
of delay in NPA marking.
CGTMSE has been extending credit guarantee facilities to
MSME Credit Guarantee Scheme Banks against their loans and advances sanctioned without
CIRCULAR (CGS) under CGTMSE – collateral security and / or third party guarantee, upto
NO. 05/2016 Lodging of ineligible activities maximum limit of Rs.100 lakh. Micro and Small Enterprises
by Member Lending (MSEs) engaged in both manufacturing and Service Sector
Institutions (MLIs) as defined under MSMED Act (except for retail trade) are
eligible for coverage under Credit Guarantee Scheme (CGS)
of CGTMSE.
Credit facilities extended for retail trade, educational /
training institutions and SHGs are not eligible for coverage.
 It has been observed by trust that, many COs are lodging
large number of credit guarantee applications pertaining to
credit facilities extended to retail trade, educational loans,
SHG loans covered under MUDRA Scheme which are not
eligible for coverage under CGS. Hence, all such credit
guarantee applications in the system are rejected by
CGTMSE. In view of this most of the system space is
getting blocked which slows down guarantee approvals.
Detailed guidelines in respect of credit score models for
MSME DIV. CREDIT SCORE MODELS MSME lending have been circulated vide MSME Division
CIRCULAR
FOR MSME LENDING- “PNB Circular No.51/2014 dated 01.08.2014 and subsequent
NO. 06/2016
SCORE SME” circulars issued on the subject from time to time.
To obviate frequent references to various circulars, operative
instructions have been consolidated and are available as
Annexure I superseding all the previous circulars in this
regard.
MSME APPROVING OF MODEL FGMO Chandigarh has approved E-Rickshaw (model no
DIVISION
AND SIGNING OF MOU with JPM-E-10000) of M/s Victory Electric International for
CIRCULAR
NO. 09/2016 M/s Victory Electric financing E-Rickshaws under the scheme PNBGreen Ride.
International, BY FGM The salient features are as under:
CHANDIGARH UNDER _ The Firm has obtained ICAT certification dated
“SCHEME FOR FINANCING 16.01.2015 for their product model no JPM-E10000.
E-RICKSHAWS – PNB _ The manufacturing facility is located at at MIE 1355, Part-
GREEN RIDE”
B Bahadurgarh - 124507 (India).
_ The company has a dealer network of 43 dealers, The list
of dealers is attached herewith for further circulation.
The firm has agreed to provide following additional benefits
to the customers of PNB:
1. Rs. 5000 discount on each Rikshaw to be financed by
PNB bank.
2. First three services free of E- Rikshaw to be financed by
PNB.
3. Advertisement of PNB bank in all over India.
4. To bear the cost of CGTSME to the extent of 1.5% on the
loan amount.
MSME Credit Guarantee Scheme As you are aware, Credit Guarantee Fund Trust for Micro &
CIRCULAR
(CGS) - Modifications in Small Enterprises (CGTMSE) has been operating Credit
NO. 10/2016
Guarantee Application Form in Guarantee Scheme since August 2000. In order to make the
 CGTMSE Portal operational mechanism of the Scheme more user friendly for
Banks, the Trust has been carrying out modifications in its
existing software based on the suggestions received from
various Banks. As a part of this exercise, they have carried
out further modifications in on line "Guarantee Application
Form" by inserting the provision for feeding following three
details:
1. Udyog Aadhaar Number
2. Bank A/c Number
3. IT PAN
MSME Credit Guarantee Scheme The upgradation module will have a maker and checker
CIRCULAR
(CGS) - Credit Guarantee concept where the maker will be the officer at operating
NO. 11/2016
Scheme (CGS) – Introduction level and checker will be the Bank's approving authority not
of below the rank of AGM or of equivalent rank. Once the
New module for upgradation of transaction is approved by the checker, the CGTMSE portal
NPA cases
will automatically upgrade the account in its record and,
thus, CGTMSE will have no role to play in the upgradation
process and no correspondence need be forwarded to
CGTMSE in this regard. Taking into consideration the
criticality of transaction viz. approval of upgradation of
account at Bank level, new user ID and password would be
generated for the checker (approver) for all the CO Member
IDs which will be strictly used only by the CO Member ID's
approving authority not below the rank of AGM or of
equivalent rank.
MSME DIV. PNB FRANCHISE : SCHEME As on date there is no separate scheme in our Bank to
CIRCULAR
FOR FINANCING provide financial assistance to franchisee(s) of reputed
NO. 13/2016
FRANCHISE OF REPUTED companies / centres/ corporations etc. In order to give
COMPANIES / CENTRES/ focused attention to such activity, we have formulated this
CORPORATIONS ETC. scheme, PNB FRANCHISE for financing franchise of
IRRESPECTIVE OF ANY reputed companies / centres/ corporations etc. irrespective of
ACTIVITY AND SIMILAR any activity (like
NATURE ENTREPRENEURS fashion/apparel/beauty aids & salons/fast food/cafe &
parlours/gifts & greetings/ health aid & services/ fitness &
gym services/ restaurants &
pubs/ education & trainings /automotives/business services
etc.) and similar nature entrepreneurs. This scheme will help
our bank to capture encouraging market of this franchise
 industry.
The detailed scheme is enclosed as per Annexure of the
circular.
MSME APPROVING OF MODEL FGMO Meerut has approved E-Rickshaw Model
DIVISION
AND SIGNING OF MOU with “SINGHAM”, manufactured by M/s U.P.Telelinks Limited
CIRCULAR
NO. 15/2016 M/s U.P.Telelinks Limited - for financing E-Rickshaws under the scheme PNBGreen
E-Rickshaw Model Ride and has entered into MoU with the manufacturer on
“SINGHAM”, BY FGMO 29.03.2016.
MEERUT UNDER “SCHEME The salient features are as under:
FOR obtained ICAT certification CAKB-
FINANCING E-RICKSHAWS 0021, dated 20.02.2015 for
– PNB GREEN RIDE”
their product model “SINGHAM”.

&39, Sector-3, Integrated Industrial Estate, SIDCUL, Pant

Nagar, U S Nagar-263153, Uttarakhand.
MSME Credit Guarantee Scheme It has been observed during the course of recent inspection
CIRCULAR (CGS) - Subrogation of rights carried out by the Trust that the recoveries made by Banks
NO. 08/2016 and recoveries on account of (post settlement of claims by CGTMSE), are not passed on
claims Paid to CGTMSE in most of the cases. It is again clarified that
Banks are required to pass on the entire amount recovered
from Borrowers to the Trust. CGTMSE, on its part, would
refund the amount pertaining to the Bank, if any, after
working out the actual loss. The sharing of loss is done by
CGTMSE in the same proportion, in which risks are being
shared between CGTMSE and Bank for the underlying
guarantee.
Now CGTMSE has informed that banks are required to send
a certificate to CGTMSE duly signed by the Statutory
Auditors that recoveries made post settlement of claims have
been fully passed on to CGTMSE as per the provisions of
the Credit Guarantee Scheme. The said certificate is
required to be submitted once in a year i.e. as on March 31
of every year. We are enclosing herewith the Format of the
Certificate/s to be submitted.
 RMD
RMD: ONLINE OPENING Please refer RMD Circular No 77 dated 31.12.2015 wherein some
CIRCULAR: OF SAVING changes have been made in the guidelines which are as under:
NO. 2 /2016 ACCOUNT - 2.For downloading data from http://10.192.11.91/OAAC, the generic
MODIFICATION user for the branches has already been created by ITD-HO and user ID
is six digit sol ID of respective branches and default Pass word is
“pnb123* ” which needs to be changed at the time of first time login
by user.
3. Admin user for all circles are being created with Circle sole by ITD-
HO with the under noted function:
3.1 Add Branch user
3.2 Edit Branch user
3.3 Unlock Branch user
3.4 Logout Branch user
3.5 Reset Branch user pass-word
Branches are advised to contact respective Circles for above
functionalities.
4. Circles may contact HO-RMD on phone 011-25755534, 25755537
and email ID rrmd@pnb.co.in to Shri Y C Joshi and Ms. Sheetal Paul
who is working as central admn. for Addition, Edit, Unlock, Logout
and Reset of Pass-word of Circle Admn. Users.
RMD, HO Internet Banking The guidelines for opening of Fixed deposits through Internet Banking
Circular No. Services – Online circulated vide RMD, HO Circular No. 33 dated 18.03.2014 which
03/2016 opening of Fixed inter-alia states that the customer has to visit the parent branch for
deposits (e-FD) premature cancellation of e-FD.
Now, the option of premature cancellation of e-FD has been provided
in the following schemes:
Multi Benefit Term Deposit Scheme, Special Term Deposit Scheme,
Ordinary Term Deposit Scheme & PNB Sugam Term Deposit.
RMD, HO RECURRING Recurring Deposit Scheme is most suitable for accumulating regular
Circular No. DEPOSIT SCHEME
savings into a handsome amount. In order to make the scheme more
04/2016
attractive, certain modifications/new features have been introduced in
the existing scheme. The salient features of Recurring Deposit Scheme
are enumerated as under:
Minimum monthly installment of Rs. 100/- or more in multiples
thereof. No maximum limit.
From 6 months to 120 months, in multiple of 1 month.
 SMS Alerts for missed installments and due date of maturity.
Free accidental death coverage to the extent of Rs. 2.00 lacs in
accounts with installment of Rs. 5000/ & above per month and are
regular.
50 Reward points on opening of account from IBS.
Payable at par in all Branches (only on Maturity).
Premature cancellation available (0.50% penalty will be levied
instead of 1%).
RMD, HO System of crediting Attention of Incumbents is invited to clause 65 (iii) of Chapter-VII on
Circular No.
interest on Term Term Deposit in Book of Instructions (Operations) regarding `Monthly
06/2016
deposits with Interest provision for interest’ reads as under:
Outflow (IO) No amount shall remain outstanding in “Interest Accrued on
Deposits” for Interest Inflow (II) type of accounts (FDMB, Anupam,
Spectrum Reinvestment). However, a provision for one day, i.e. the
day of interest application is maintained in “Interest Accrued on
Deposits” at the end of the quarter in respect of Interest Outflow (IO)
types of Term Deposits {i.e. Ordinary Fixed Deposits, Special Fixed
Deposits, Varshik Aay Yojna}, in the CBS system would remain
outstanding in the “Interest
Accrued on Deposits” as on the last day of the quarter.”
RMD, HO AUTO RENEWAL Detailed guidelines in respect of Auto Renewal of Domestic Term
Circular No.
OF DOMESTIC Deposits on maturity were last circulated through RMD Circular No.
07/2016
TERM DEPOSITS 69 dated 16.11.2015 which inter-alia states as under:
ON MATURITY - Where the customer has opted for auto renewal, his/her term deposits
shall be auto renewed after the date of maturity except Term Deposit
under PNB Tax Saver Scheme, Capital Gain Scheme, Recurring
Deposit Scheme, deposit accepted under Bulk Term Deposit (above
Rs.10 Crore) and Inter Bank Deposits.
It has been observed that system allows auto renewal of fixed deposits
opened under maturity option (Reinvestment of interest) in PNB
Growth Fixed Deposit Scheme having maturity value more than Rs.10
crore.
Hence, the auto renewal exceeds the threshold limit of Rs.10 crore. In
terms of extant guidelines, fixed deposit above Rs.10 crore is accepted
only under PNB Bulk Deposit Scheme with the prior approval of
Circle Head in consultation with Treasury Division, Head Office.
The field functionaries are advised to ensure that auto renewal of the
fixed deposits having maturity value of Rs.10 crore is to be accepted
 for principal amount only i. e. upto Rs.10 crore. The branch
incumbents are advised to contact the customers of existing FDRs
having maturity value above Rs.10 crore with auto renewal
instructions and inform them that auto renewal of such FDR will not
take place and only principal amount can be accepted for auto renewal.
RMD: Circular Guidelines on Banking The foreign nationals employed in India holding valid visas are
No.9/2016
Services for Foreign eligible to maintain resident accounts with an Authorised Dealer
Nationals working In Category - I (AD Category-I) bank in India except the Pakistani and
India- Procedure for Bangladesh Nationals, who have to fulfill the following conditions:
opening of bank Pakistani National will require a prior approval from RBI before
accounts opening the account.
Bangladesh National to have a valid visa and residential permit issued
by Foreigner Registration Office (FRO) / Foreigner Regional
Registration Office (FRRO) concerned.
The AOF, KYC Document and FATCA details have to be procured as
per the guidelines for Resident Deposit accounts.
The AD Category-I banks are required to close the resident accounts
of such foreign nationals on their leaving the country and transfer their
assets to their accounts maintained abroad.
However,to facilitate the foreign nationals to collect their pending
dues in India. AD Category-I banks may, therefore, permit such
foreign nationals to redesignate their resident account maintained in
India as NRO account on leaving the country after their employment
to enable them to receive their pending bonafide dues
RMD: Debiting of proper Attention of the Incumbents is invited towards RMD: Deposit:
CIRCULAR income head at the
Circular No.32 dated 15.03.2014 and other subsequent circulars issued
NO.10 time of reversal of non
credit related charges from time to time inter-alia informing the detailed guidelines as well
as power to allow relaxation in non-credit related service charges
listed in the circulars at various level.
It is observed that the appropriate income head is not debited in case of
reversal of charges.
Incumbents In charge to ensure that the same head is debited at the
time of allowing reversal of charges which was originally credited.
Further, it is to be ensured that any reversal of charges is to be made
only with the prior approval of the competent authority
RMD:CIRCUL LAUNCH OF PNB On International Women's Day i.e. 08.03.2016, to empower women,
AR:NO.12/201
POWER SAVINGS Bank will be launching a new saving fund product viz “PNB PoWer
6
ACCOUNTS Savings” for women.
 Any resident individual woman who is otherwise eligible to open a
saving fund account can open
the “PNB PoWer Savings” account either singly or jointly provided in
joint account, the first name should be of woman.
The product is being launched with unique features e.g. free Personnel
Accident Insurance (PAI)* cover upto Rs.5.00 lac and lot of
concessions/ reward points programme besides option of sweep
facility. The branch incumbents are advised to display the key features
of the product on the notice board for the information of the
customers.
The freebies/benefits are applicable for new accounts opened under the
scheme (Scheme code (SBPWR).
RMD, HO Internet Banking Attention of the Incumbents is invited towards RMD, HO Circular No.
Circular No. Services – Online
03/2016 dated 11.01.2016 advising guidelines regarding pre-mature
13/2016 opening of Fixed
deposits (e-FD) cancellation of e-FD through Internet Banking facility (IBS).
It was also informed that pre-mature closure of e-FD can be done
through (IBS) during Branch timings only.
IT Division, HO now has modified the utility of online pre-mature
closure of e-FD after Branch EOD as well but upto Central EOD w.e.f.
15.02.2016.
After Central EOD, the customer’s request will be captured with
display of
the message on screen that his/her request will be processed on the
next working day. Once the request is captured, it will be executed by
the system at BOD level on the next working day without any further
request of the
customer.
RMD:CIRCUL OPENING OF NEW On review of position of daily opening of new saving accounts in the
AR:NO.17/201 SAVINGS
branches, it is observed that quite a large number of accounts
6 ACCOUNTS
(Sometimes even more than 50% of total accounts on a particular day)
are opened with zero balance.
Although some specific schemes e.g. BSBDA, PNB Vidhyarthi, Junior
Saving Account, Total Freedom Salary Account, PNB Rakshak, PNB
Shikshak etc. provide for opening of accounts with zero balance, yet
the customers be persuaded to deposit at least some nominal amount
say Rs.100/- while opening the account under the above exempted
category as well.
This will give ownership to the customers from the day one & avoid
 the account becoming dormant on one side besides improving the
saving portfolio of the bank on the other side.
RMD/16/2016 PNB Rakshak To make scheme more competitive and attractive, it has been decided
Scheme- to enhance Personal Accidental Insurance (PAI) cover and to provide
Modification/ additional benefit of Accidental death insurance cover during Air
Enhancement in Travel to PNB Rakshak account holders under certain terms &
Accidental Insurance conditions.
Cover Existing facilities Revised facilities
Personal Accident Personal Accident Insurance benefit will
Insurance benefit is be linked to credit of monthly salary for
linked to uses of previous three months in the account.
Debit Card within 45
days
Personal Accident Personal Accident Insurance (PAI)
Insurance (PAI) coverage
coverage Cadre Amt. Cover
Cadre Amt. Persons Rs. 3 lacs
Cover below officer
Persons Rs.2 rank
below lacs Officers below the Rs. 5 Lacs
officer rank of Brigadier
rank Brigadier & above Rs. 10 Lacs
Persons Rs. 5
of Lacs
officer
rank
& above

No separate Accidental death insurance benefit

Accidental air during Air Travel.*
Insurance cover Cadre Amt. Cover
available Persons Rs. 5 lacs
below officer
rank
Officers below the Rs. 10 Lacs
rank of Brigadier
Brigadier & above Rs. 20 Lacs
RMD: CIR: PNB SURAKSHA Considering the facts that the facility is for valued customers, it has
No. 20/2016
been decided to continue the facility under PNB Suraksha free of
charge till 31.03.2017. All other terms and condition shall remain
unchanged.
RMD Circular MINI DEPOSIT As per the Delhi High Court judgment dated 05.10.2015 in the appeal
No. 18 /2016 SCHEME against the award dated 07.10.2013 of Central Government Industrial
dated Tribunal cum Labour Court-1 New Delhi, the guidelines in respect of
19.03.2016 payment of Commission, Fall Back wages, meeting standard of
collection by mini deposit collectors and minimum duration of Deposit
in the Mini Deposit Scheme have been reviewed/modified
1. Applicability: Fresh accounts will be opened in those branches only
where the scheme is in operation.  The Scheme shall not be
introduced at any other branch other than those, where it is already
implemented /operational.  No new Mini Depositor Collector can be
appointed.

PSLB
PSLB/CRDT Consolidated In supersession of the guidelines contained in above cited
CIRCULAR Guidelines on circulars/letters, Bank has consolidated guidelines on Financial
NO. 2/2016 Financial Literacy Literacy Centres; details of which are given in Annexure of the
Centres (FLCs) circular.
Consolidated
Guidelines on
Financial Literacy
Centres (FLCs) –
Corrigendum
PSLB Credit requirement of Branches are aware that Rural Self Employment Training Institutes
/CRDT/CIRC RSETI trained (RSETIs) provide training to the youths for undertaking self
ULAR NO. 78 candidates under employment ventures in micro entrepreneurs comprising of
/2015 MUDRA Scheme manufacturing, processing and servicing which need credit support to
fructify the efforts of RSETIs. The Joint Secretary, Ministry of Rural
Development, (MoRD) Government of India vide communication
dated 3.12.2015 has exhorted for extending timely and adequate
credit support to RSETI trained candidates under MUDRA Scheme in
a hassle free manner. In this regard, Branches are advised to note the
 following guidelines:
1. All the credit requirements of RSETI trained candidates shall be
met under
MUDRA Scheme under Non-Farm Sector category and the loan
applications received by the branches shall be disposed off within a
fortnight.
2. The eligible candidates shall be properly guided by the branches
for the
requirements to be submitted and a checklist of requirements shall be
made available to them.
A new field has been created in the RSETI - MIS software to track
the progress made in credit linking RSETI trained candidates under
MUDRA Scheme and the progress made in credit linking of RSETI
trained candidates will be reviewed at fortnightly intervals based on
the data furnished by MoRD to Ministry of Finance, Department of
Financial Services, New Delhi.
PSLB/ WS/ PNB SAKHI – The SHG concept is a powerful tool which helps in organizing the
SHG/ INCENTIVE poor and marginalized to come together for pooling their savings and
CIRCULAR SCHEME FOR resources and ultimately
NO. 05/2016 FACILITATING SHG leads to gainful self employment. Over the last two decades SHGs
BANK have achieved
LINKAGE. many milestones and have set examples by successfully undertaking
various
agendas ranging from women related issues to issues of community
development, and additionally, by establishing market linkages for
rural women entrepreneurs.
One of the obstacles faced in the way of SHG – bank linkage
program in- spite of all the good intentions is the lack of human
resources in the rural branches of banks.
Most of the SHG members have relatively low educational
background and they therefore require guidance and support for
carrying out their bank transactions. The
rural branches with limited staff are not in a position to provide
necessary support to
the SHGs, in addition to their routine banking work.
The captioned scheme is being launched with the objective of
strengthening Bank
SHG Linkage. The detailed guidelines are placed as Annexure.
CODIFIED National Rural Now, the Reserve Bank of India, Central Office, Mumbai has issued
CIRCULAR Livelihoods Mission Circular RBI/2015-16/296 IDD.GSSD.CO.BC.No.19 /09.01.03/2015-
NO. (NRLM)- 16 dated January 21, 2016 on National Rural Livelihoods Mission
PSLB/WS/NR Aajeevika-Interest (NRLM)-Interest subvention scheme .
LM/ 1 /2016
Subvention Scheme
The consolidated guidelines are given in Annexure of the circular.
PSLB/ WS/ CREDIT With a view to reduce information asymmetry between lenders and
SHG/
INFORMATION borrowers and to develop an efficient credit information system a
CIRCULAR
NO. 07/2016 REPORTING IN Committee was constituted under the Chairmanship of Sh. Aditya
RESPECT OF SELF Puri by Reserve Bank of India.
HELP
GROUP (SHG) The Committee in its report had recommended that banks may
MEMBERS. capture and provide credit related information of individual
borrowers within Self Help Groups (SHGs) to the Credit Information
Companies (CICs). The banks pointed out a number of
challenges in implementation of these directions and requested for
greater clarity on their scope. Consequently, the RBI constituted a
working group to study the implementation challenges and suggest
measures to address them
PS&LB Scholarship Scheme Detailed guidelines with regard to implementation of above scheme
/FWT/CIRCU
‘PNB KISAN were issued vide our PS&LB/FWT/CIRCULARNO/65/2015 dated
LAR
NO./13/2016 BALAK SHIKSHA 05.10.2015 for popularization of education among children of poor
PROTSAHAN agriculture borrowers of the Bank. For the academic year 2014-15
YOJANA’ for last date for receipt of applications for scholarship by Circle Offices
promoting of was 31.12.2015 and claims for reimbursement to circle offices by
education among PNBFWT, HO was 31.01.2016.
children of the poor
loanee However, till date response to the scheme by the Circle Offices has
farmers (small been poor and very few reimbursement claims have been received at
farmers, marginal ours. It appears that scheme has not been publicized at the grass root
farmers, tenant level. In order to ensure that scheme gets maximum coverage and
farmers, oral lessees adequate number of applications is mobilized by the branches, the
and agriculture labour) last date for receiving of applications by Circle Offices has been
of our Bank –
extended from 31.12.2015 to 30.09.2016.
EXTENSION OF
THE SCHEME
PSLB/FARM SCHEME FOR 1 Eligibility Women JLGs who operate as one borrowing unit.
CREDIT
FINANCING 2. Purpose 1. Dairy/ Poultry/ Goat & Sheep rearing/ Fishery/
CIRCULAR
NO. 14/2016 WOMEN JOINT Piggery
LIABILITY GROUPS 2. Custom Hiring Units
 (JLGS) – 3. Crop production
COLLATERAL 4. Food & Agro Processing
FREE UPTO Rs. 10
3. Nature of facility
LAKH
Term Loan and/ or Working capital
4. Extent of Loan i) Term Loan – Need based.
ii) Working capital – Need based
iii) For crop production – Need based as per KCC guidelines. Max.
Rs. 50 lakh
5. Rate of Interest
Loans upto Rs. 20 lakh: BR+1%+TP
Loans above Rs. 20 lakh: 0.50% concession in the applicable rate of
interest.
For KCC/ Short term crop loans interest to be charged as
per Interest Subvention guidelines.
Note: No further concessions like festival bonanza concession,
scheme specific concessions etc. are to be allowed.

PS&LB ‘PNB LADLI’ Detailed Guidelines with regard to implementation of SCHEME FOR
/FWT/CIRCU
SCHEME FOR PNB LADLI FOR POPULARISATION OF EDUCATION AMONG
LAR
NO./17/2016 POPULARISATION GIRLS OF RURAL/SEMI URBAN INDIA had been circulated vide
OF EDUCATION PS&LB/FARMCREDIT Circular No. 58/2014 dated 26.06.2014 and
AMONG GIRLS OF partially modified vide Circular No. 62/2014 dated 26.06.2014. Vide
RURAL/SEMI PS&LB/FWT Circular No. 34/2015 dated 25.04.2015, the scheme
URBAN INDIA was extended for the financial year 2015-16
PS&LB Scholarship Scheme Detailed guidelines with regard to implementation of above scheme
/FWT/CIRCU
‘PNB KISAN were issued vide PS&LB/FWT/CIRCULARNO/65/2015 dated
LAR
NO./18/2016 BALAK SHIKSHA 05.10.2015 for popularization of education among children of poor
PROTSAHAN agriculture borrowers of the Bank. For the academic year 2014-15
YOJANA’ for last date for receipt of applications for scholarship by Circle Offices
promoting of was extended to 30.09.2016 vide PS&LB/FWT/CIRCULAR NO.
education among 13/2016 dated 11.02.2016.
children of the poor Existing Revised
loanee farmers (small Only those children who Students of Government and
farmers, marginal are regular students of Government aided/ Private
farmers, tenant Government Schools/ Schools/Colleges/ Universities
farmers, oral lessees Colleges/Universities shall shall be eligible.
and agriculture labour) be eligible.
of our Bank – The ceiling on number of The ceiling on number of cases has
 AMENDMENT OF cases has been restricted to been restricted to 100 children per
THE SCHEME 100 children per Circle. Circle as well as 100 children per
LDM Office
Circular No MICRO CREDIT - Detailed guidelines of above scheme were circulated vide our
PSLB/WS/SH
SELF HELP GROUPs codified circular No PSLB/WS/SHG/20/2015 , now, Master Circular
G/16 /2016
(SHGs) - Non RBI on SHG-Bank Linkage Programme has been updated with
Government modification at Para No. 5 and addition of Para No. 16 vide their
Sponsored Scheme letter RBI/2015-16/29 as on 04.02.2016.Modification is as under:
Existing Revised
Separate Segment under Separate Segment under priority
priority sector: In order sector: In order to enable the banks
to enable the banks to to report their SHG lending without
report their SHG lending difficulty, it was decided that the
without difficulty, it was banks should report their lending to
decided that the banks SHGs for onlending to members of
should report their SHGs under the new respective
lending to SHGs/ and /or categories, viz. 'Advances to SHGs'
to NGOs for onlending to irrespective of the purposes for
SHGs/members of SHGs which the members of SHGs have
under the new segment been disbursed loans. Lending to
viz. 'Advances to SHGs' SHGs should be included by the
irrespective of the banks as part of their lending to the
purposes for which the weaker sections
members of SHGs have
been disbursed loans.
Lending to SHGs should
be included by the banks
as part of their lending to
the weaker sections
New Clause Service / Processing charges : No
loan related and adhoc service
charges/Inspection Charges should
be levied on priority sector
advances up to Rs 25000. In case of
eligible priority sector loans to
SHGs/JLGs, this limit will be
applicable per member and not to
the group as whole.
PSLB/FARM Union Budget – 2015- In view of the above guidelines of Govt of India, the earlier
CREDIT
2016 – Interest instructions of calculating subvention in the regular crop loan/KCC
CIRCULAR
NO. 20/2016 Subvention Scheme – accounts on running balance outstanding upto Rs. 3 lakh will
2% Interest continue for the year 2015-16 also.
Subvention and 3% Notes: (i) The claim for additional 3% incentive subvention will be
Additional Subvention lodged in the month of April, 2016, guidelines of which will be
for short-term crop circulated separately. It is to be noted that the additional subvention
loans of 3% has no impact on the revenue of the bank since it is to be
/produce (marketing) passed on to the eligible prompt paying farmers and subsequently
loan in 2015-16 willbe claimed from the Govt. As such, no accounting entry is to be
passed in respect of this additional subvention of 3%.
(ii) 3% additional incentive subvention, pertaining to the year 2014-
15 is to be claimed separately by April 15, 2016, guidelines of which
are being issued separately.
(iii) 2% Interest subvention available on restructured amount for the
first year, pertaining to FY 2015-16 is to be claimed separately by
April 15, 2016, guidelines of which are being issued separately.
PSLB/FARM Interest Subvention RBI Guidelines on Interest Subvention for 2015-16 states that “to
CREDIT
Scheme – 2% Interest provide relief to farmers affected by natural calamities, the interest
CIRCULAR
NO. 21/2016 Subvention on subvention of 2% will continue to be available to banks for the first
KCC/short-term year on the restructured amount. Such restructuredloans may attract
crop loans restructured normal rate of interest from the second year onwards”.
on account of Natural 1. Eligible accounts:
Calamity. I. KCC/short-term crop loans restructured on account of Natural
Calamity.
II. The rate of interest being charged in the first year is 7%.
2. Calculation of Subvention @ 2%:
I. KCC/short-term crop loans restructured on account of Natural
Calamity, 7%
p.a. rate of interest is to be charged upto outstanding balance of Rs.3
lakh for the first year.
II. On the outstanding balance beyond Rs.3 lakh applicable normal
rate of interest is to be charged.
PSLB/FARM 3% additional The consolidated claim in respect of 3% additional subvention for the
CREDIT
incentive subvention entire year 2014-15 is to be submitted in the month of April 2016.
CIRCULAR
NO. 22/2016 for short-term crop The modalities for calculating 3% additional subvention and
loans in 2014-15 submission of claim are given hereunder:
1. Eligible accounts:
 The accounts which fulfill the following conditions will be eligible
for 3% Incentive Subvention:-
I. Individual debit entries during the year 2014-15 are adjusted within
a maximum period of 12 months.
II. The recovery received in the account may be first appropriated
towards the previous year’s outstanding balance and then the current
year disbursement.
1. Where the total outstanding exceeds Rs. 3 lakh, the incentive
subvention will be calculated only upto the outstanding of Rs. 3 lakh.
2. The recovery in the account during the year 2014-15/2015-16 may
be first appropriated towards the outstanding balance as on
31.03.2014 followed by interest charged during the year 2014-15 and
then the disbursement during the year 2014-15.
3. The recovery during the year 2014-15 should be at least equal or
more than theoutstanding as on 31.03.2014.
FINANCIAL INCLUSION

FID Deployment Micro-

Specification of Micro-ATM version 1.5.1 has been standardized by
IBA/ UIDAI/ NPCI/IDRBT. Bank has shortlisted two vendors namely
CIRULAR ATMs at Business
M/s Smart Chip Ltd & M/s VeriFone India Limited through RFP
NO. 02 / 2016 Correspondent (BC) process for procurement of Micro-ATMs as per specification defined
as version 1.5.1.
Locations
Bank is in the process of procurement of Devices from the approved
Vendors through Circle Offices to be deployed at Business
Correspondents Outlets. The cost of devices has three components i.e.
(i) Hardware, (ii) Software application & (iii) Support Services. Out
of these cost of Hardware would be borne by Business
Correspondents and that of Software & Support Services will be
borne by the Bank.

Guidelines, in this regard are attached as Annexure I and Operational

Manual as Annexure II. Field functionaries are requested to ensure
that the Micro-ATMs are deployed at all the BC locations by
20.01.2016 without any exception.
FID Guidelines for quick With the launch of PMJDY on 28.08.2014 and PMJJBY & PMSBY
disposal of claim
CIRCULAR on 01.06.2015, four types of claims proposals are being received at
cases under PMJDY,
NO. 03 / 2016 PMJJBY & PMSBY branches. Different types of claim cases vis-a-vis detailed guidelines
issued vide circulars are as under:

1. PMJDY Life Insurance coverage of Rs.30000/- for PMJDY

accounts opened up to 31.01.2015 (Circular No. 28/2014
dated 21.11.2014).
2. Accidental Insurance coverage of Rs.100000/- to eligible
RuPay card holder (Circular No. 33/2015 dated
08.12.2015).
3. PMJJBY Life Insurance coverage of Rs.200000/- (Circular
 No.29/2015 dated 22.09.2015).
4. PMSBY Accidental Insurance coverage of Rs.200000/-
(Circular No. 29/2015 dated 22.09.2015).

We are receiving various references from field functionaries

pertaining to claim disposal process under PMJDY, PMJJBY &
PMSBY. For ready reference, for quick disposal, salient features of
the scheme along with desired requisite documents are reiterated in
the circular.

FINANCIAL Revised Detailed guidelines on Financial Inclusion for extending Banking

INCLUSION
Remuneration/ Services using Kiosk Banking Solution (KBS) Based Business
DIVISION
INTERNAL Charges for Corporate Correspondent (BC) Model were circulated vide Financial Inclusion
CIRCULAR
BC, CSC-SPV & BC Cir. No. 04/2014 dated 03.03.2014. Thereafter, remuneration/ charges
LETTER NO.
1/2016 Agents for Corporate BC, CSC-SPV & BC Agents were revised vide FID
Internal Circular no. 22/ 2014 & 24/ 2014 dated 08.12.2014 and
31.12.2014 respectively.
Keeping in view the various factors, the remuneration structure
payable to Business Correspondents have been revised. The revised
remuneration / charges payable to BC Agents, Corporate BC and
CSC-SPV are given at Annexure.
FINANCIAL Observing due DFS, MOF, GOI vide their letter F.No. 21/12/2014-FI (MISSION
INCLUSION diligence in small
OFFICE) dated 29.01.2016 has advised to observe due diligence in
DIVISION accounts opened
INTERNAL under PMJDY small accounts opened under PMJDY and informed as under:
CIRCULAR
“In view of the large number of accounts opened under PMJDY, we
LETTER NO.
3/2016 understand that
branches might have also opened such “Small Accounts “ .It is
possible that due to the restrictions in Small Accounts ,some
beneficiaries in various DBT schemes might be facing difficulties due
to the Rs 50,000 upper limit of balance in such accounts.”
All the Field General Managers and Circle Heads are requested to
take up with branches to ensure that necessary review mechanisms (to
obtain necessary KYC documents) are in place to monitor the
transactions/threshold limit for the small accounts opened under the
Yojana.
Financial Kiosk Banking During the visit of the Senior Officers at Business Correspondent(BC)
Inclusion
Solution(KBS) Based location it has been observed that board showing the product/services
Division
Circular Letter Business offered at BC locations is not displayed at most of the BC outlets.
No. 04 /2016
Correspondent (BC) In order to facilitate the matter, we are enclosing herewith updated list
 Model of products/services available at Business Correspondent location as
– Product/Services Annexure. All
offered to Financial
base branches may be advised to arrange to display the board showing
Inclusion Customers
the list of products & services at BC location. Please display list in
vernacular language also as per the policy of the Bank.
FINANCIAL Action Plan for In order to finalise an Action Plan to ensure that subscribers to these
INCLUSION
ensuring renewal of schemes renew their subscriptions for the next year and sufficient
DIVISION
INTERNAL insurance policies funds are accordingly available in their bank accountsfor auto debit of
CIRCULAR
under premium by 31st May, 2016, a meeting was held with representatives
LETTER NO.
5/2016 PMSBY/PMJJBY for of Banks and Insurers under the Chairmanship of Joint Secretary
all the enrolled (Insurance).
subscribers Following were the key decision points:
i) Renewal drive to be undertaken from first week of May, 2016 to
publicize and make subscribers aware of the need to keep sufficient
balance in their bank accounts for auto debit of the renewal premium
of Rs. 330/- for PMJJBY and Rs.12 for PMSBY between 26th May,
2016 and 1st June, 2016.
ii) Banners to be put up by Banks in all their branches as per the
format devised by Mission Office, DFS.
iii) LDMs/District Collectors in States to be sensitised towards
ensuring spread of message concerning renewal of schemes in each
Gram Panchayat.
iv) In the second week of May,2016; Banks to focus more on those
Bank accounts that have insufficient balance for auto debit of
premium under these schemes.

FINANCIAL INCOME TAX “In exercise of the powers conferred by sub – section (I) of section
INCLUSION
EXEMPTION 80CCD of the Income tax Act, 1961 (43 of 1961), the Central
DIVISION
CIRCULAR NOTIFICATION Government hereby notifies the „Atal Pension Yojna (APY)‟ as
NO 6
UNDER ATAL published in the Gazette of India, Extraordinary, Part I, Section I, vide
PENSION YOJNA number F. No. 16/01/2015-PR dated the 16th October, 2015 as a
(APY) pension scheme for the purpose of the said section.”
FINANCIAL V-SAT DFS during last weekly review meeting of PMJDY/ FI, advised to
INCLUSION
INSTALLATION AT avail NABARD support under Financial Inclusion Fund (FIF) for
INTERNAL
CIRCULAR GREY AREAS- installation of V-SAT in Grey areas.
LETTER NO.
SUPPORT UNDER Grey areas are such BC locations where Bank Mitrs (BCAs) are
6/2016
FINANCIAL available but not able to work due to intermittent / poor internet
INCLUSION FUND connectivity.
 OF NABARD Procedure for availing NABARD support under FIF for installation of
V-SAT is as under:
Proposals are to be submitted to the respective regional offices of
NABARD along with certificate from SLBC regarding allocation of
SSAs and problem of connectivity.
Submission of details of the locations under Grey area where V-SAT
is to be installed (Detail address of SSA alongwith contact details of
Bank Mitrs/ BCAs.
Submission of vendor detail for V-SAT under OPEX model and the
cost estimate as per ITD circular mentioned in FID circular no.
32/2015 which is as under:

Service Band Rate per Total cost Total cost per

Provider width month per BC location
per BC for 5 years
Locatio location
n per year
M/s 64 Rs. Rs. 21600/- Rs. 108000/- +
BSNL , Kbps 1800/- + + Applicable Tax
M/s Airtel Applica Applicable
(Bharti), ble Tax Tax
M/s
Hughes
FID Pradhan Mantri Jan The disbursement of overdraft in BSBD account is being monitored
CIRCULAR
Dhan Yojana by DFS, GoI, on regular basis through video conference with
LETTER NO
8 /2016 (PMJDY) - Overdraft Executive Director and quarterly basis with MD & CEO. There is a
Facility up to Rs.5, clear cut instruction to sanction/ disburse overdraft in all eligible
000/- in PMJDY accounts.
(BSBDA)Accounts In order to simplify the process of providing overdrafts, a single menu
option SBAOD has been customized in CBS. This facility has also
been enabled through Alternate Delivery Channels (ADCs) viz ATM,
SMS/ Mobile Banking and Internet Banking Services (IBS) on the
basis of explicit mandate by customer/s digitally.
FINANCIAL Introduction of Multi Multi Benefit Terms Deposit Scheme (MBFD) is a variant of Fixed
INCLUSION Benefit Term Deposit Deposit which is operational from the Branches. Detailed guidelines
DIVISION (MBFD) Scheme at on the scheme have been issued by Resource Mobilization Division
CIRCULAR Business (RMD) vide RMD Circular No.48/2015 dated 11.09.2015. For ready
NO. 09 / 2016 Correspondent (BC) reference to the field, extant guidelines of MBFD as mentioned in
locations under Kiosk aforesaid circular are attached as Annexure.
Banking Solution This scheme has been customized at Kiosk Banking Solution (KBS)
(KBS) also to be used at BC locations with limited functionalities.
Financial Launching of PNB A Micro Deposit Scheme has been introduced which will be operative
Inclusion HO: Sanchay (Micro from the BC locations.
Circular No10 Deposit Scheme) at The Micro Deposit Scheme has the combined features of RD/Flexi
/2016. BC locations RD and Mini Deposit Scheme which will be available from BC
locations and having following Broad features:
Deposit Amount: Initial deposit of Rs.50/- and thereafter in multiple
of Rs.50/- with maximum of Rs.5000/- at a time and subject to
maximum of Rs.60000/- p.a. Deposit can be made daily or as per
customer’s choice.
Period of deposit: 12 months to 36 months

RAD
RAD PADHO PARDESH The Nodal Bank viz Canara Bank, based on the instruction of
CIRCULAR SCHEME – Ministry of Minority Affairs,
NO 03 /2016 OPENING OF WEB Govt. of India has informed that Padho Pardesh Portal will remain
PORTAL FOR open for lodgement of interest subsidy claim as under:
SUBMISSION AND Quarter Last Date
LODGMENT OF June 2015 & Sept 2015 01.02.2016
CLAIMS FOR Dec’2015 15.02.2016
JUNE’15, SEPT’15 & Field functionaries are advised to capture data in all eligible accounts
DEC’15 QUARTER which are eligible
for claim through invoking Menu option “PPEDU” in CBS
RETAIL HOUSING FINANCE Ministry of New and Renewable Energy (MNRE) is focusing on
ASSETS SCHEME FOR installation of solar power systems and has advised Banks to finance
DIVISION PUBLIC - the cost of the solar power systems under housing loan/ home
CIRCULAR MODIFICATIONS improvement loan. Accordingly, it has been decided to include
NO.:04/2016 A. FINANCING OF financing cost of solar power systems under Housing Finance
SOLAR POWER Scheme for Public.
SYSTEMS UNDER Salient features of the scheme are as under:
HOUSING FINANCE Loan Amount:-Max. Rs.2.00 lac. However, Circle Head is
SCHEME; empowered to permit need based loan amount for installation of solar
B. TAKEOVER OF system;
 HOUSING LOAN Margin: As per housing loan scheme
ACCOUNTS FROM Rate of Interest: Where applicant is ready to mortgage the house,
OTHER BANKS/FIs whether the installed system is part of housing project or not, ROI to
be charged as per housing loan scheme. Further, where solar power
system is installed on standalone basis and applicant is not ready to
mortgage the property, ROI to be charged at BR+2.00% under
floating option only. No fixed option is available.
Repayment period: As per housing loan scheme where mortgage of
house is available. However, where solar system is installed on
standalone basis and applicant is not ready to mortgage the property,
maximum 36 months
repayment period to be permitted.
TAKEOVER OF HOUSING LOAN ACCOUNTS
Based on the references received from the field and to remain
competitive in the market with respect to repayment period in case of
takeover of housing loan accounts, it has been decided that, at the
time of takeover of Housing Loan, the sanctioning authority, based on
the merits of the case and eligibility of the borrower, is allowed to
permit repayment period as per Housing Finance Scheme for Public
after reducing the period already availed with the existing bank,
provided that at all times the criteria regarding maximum loan
amount, LTV ratio, maximum repayment period etc. under the
scheme are not diluted.
RETAIL VIDYALAKSHMI Based on the recommendations of the IBA Working Group on
ASSETS
PORTAL Education Loan Scheme NSDL e-governance has developed the
DIVISION
CIRCULAR AN ELECTRONIC portal, named as “Vidya Lakshmi
No. 05/2016 PLATFORM TO
Electronic Platform”, the features of which are as under:
APPLY FOR
EDUCATION LOAN
scholarships and education loans of banks.

portal.

status of loan applications

The Bank has integrated with the Portal and has got enrolled its
Education Loan schemes on it. The access to the Portal has been
provided to Retail Assets Division, Head Office.
The application lodged by the students are downloaded by the bank
 and processed by them. After the application is processed, the status
is to be uploaded by the Bank on the Portal. The various status to be
updated on the NSDL Portal are
1) Submitted 2) In Process 3) Prima Facie Eligible 4) Rejected
5) Need More Information 6) Approved 7) Disbursed and 8)
Closed. The status is to be updated within the prescribed
Disposal Time Norms.

RAD CENTRAL SCHEME The Govt. of India Ministry of HRD has once again decided to make
CIRCULAR
TO PROVIDE available the web portal to submit the pending claims pertaining to
NO. 8/2016
INTEREST the years from 2009-10 to 2014
SUBSIDY ON Indian Banks’ Association (IBA) has informed that the Nodal Bank
EDUCATION viz. Canara Bank shall keep the web portal open till 15th March 2016
LOAN TO SC/ST for the purpose of lodging all pending claims for the period from
STUDENTS UNDER 2009-10 to 2014-15 in respect of eligible students belonging to
EWS CATEGORY SC/ST category only.
FOR THE YEARS To facilitate lodgment of the claim, menu option “ARRSUB” has
FROM 2009-10 TO been provided in CBS system .
2014-15
RETAIL APPRECIATION To involve each staff member in marketing and growth of business,
ASSETS
AND our bank launched an Appreciation and Recognition campaign for
DIVISION
CIRCULAR RECOGNITION retail Loan (Housing/Car/and Education), vide Circular no 104/2015
NO: 9/ 2016
CAMPAIGN dated 02.11.2015. The campaign was for a period of two months from
---- DECLARATION 1st November 2015 to 31st December 2015.
OF RESULTS The focus of the campaign was as under:

their or their immediate family members from other than PNB, even
in case the outside rate/terms may be slightly better than our bank.

members loan accounts to PNB, in case they have raised loans from
other banks.

The result of performance under the campaign has been compiled by

the Division, in which 282 staff members (Annexure-I) have been
found eligible for award of Appreciation Letters by
MD&CEO/ED/FGM/Circle Head, as per Campaign Scheme.
RETAIL SCHEME FOR Kind attention is also invited towards RAD Circular No 105 dated
ASSETS
FINANCE AGAINST 10.11.2015 vide which the maximum loan amount has been increased
DIVISION
CIRCULAR MORTGAGE OF from Rs.3.00 crore to Rs.5.00 crore for the purpose of business needs
NO.:10/2016
 IMMOVABLE under the scheme for financing against mortgage of immovable
PROPERTY property.
ENHANCEMENT OF We have been receiving references from the field functionaries
LIMIT BEFORE 12
seeking clarification regarding enhancement in the limit before 12
MONTHS
months where the borrower was eligible for higher limits at the time
of last sanction but lower limits were sanctioned due to cap in
maximum amount as per earlier scheme.
In this respect it is clarified as under-
1. Sanctioning authority under his/her vested loaning power may
consider increase in limit for business needs upto Rs.5.00 crore
before 12 months in the cases where:
i) Borrower was otherwise eligible for higher loan amount based on
value of the
property and repaying capacity at the time of last sanction;
ii) Borrower brings additional IPs, without reassessment of repaying
capacity.

2. One step higher authority is allowed to permit deviations/ sanction,

as the case may be, within his/her vested loaning power to increase
limit for business needs upto Rs.5.00 crore before 12 months
3. In no case revaluation of property to be done, i.e., value of the
property shall remain same as per the last sanction.
RETAIL TIE UP Detailed guidelines regarding ‘Financing of Solar Power Systems
ASSETS ARRANGEMENT
under Housing Finance Scheme’ have been issued vide RAD Circular
DIVISION WITH UNITED
CIRCULAR TELECOMS LTD No. 04/2016 dated 15.01.2016. 2. In order to contribute towards
NO.: 11 /2016 (UTL) FINANCING
achieving the National Goals set for Solar Power Generation, the
OF SOLAR POWER
SYSTEMS UNDER bank has to consider financing Solar Power Systems in large
HOUSING FINANCE
numbers. To facilitate the field functionaries bank has entered into a
SCHEME
Tie-up arrangement with M/S United Telecoms Ltd. (UTL) for
financing their Solar Rooftop Smart Inverter System (non Grid-
connected) – SOLARIX 24X7 to credit worthy retail customers as a
part of housing loan. The company (UTL) is financially sound and
also product is certified by MNRE approved LABS.
RETAIL Scheme of Interest In pursuant to the Para 6 of the Circular regarding issuance of
ASSETS Subsidy on Education
operational guidelines, the new menu option “OBEDU” has been
DIVISION: Loans for Overseas
CIRCULAR Studies for the provided in CBS to facilitate submission and lodgment of claim.
NO: 14 /2016 students belonging to
The operational guidelines are enclosed as per Annexure “A”.
OBCs & EBCs
communities To facilitate the field functionaries the consolidated guidelines on the
 subject are also enclosed as “Consolidated guidelines on Scheme of
Interest Subsidy on Education Loans for Overseas Studies for the
students belonging to OBCs & EBCs communities”.
RETAIL HOUSING FINANCE Based on the references received from the field it has been decided to
ASSETS SCHEME FOR modify parameters ‘Extent of Loan’ and ‘Margin’ to purchase of
DIVISION PUBLIC- land/plot for house building under Housing finance scheme for
CIRCULAR PURCHASE OF Public.
NO.:16/2016 LAND/PLOT FOR 1. FGMCAC has been empowered to sanction loan for purchase of
HOUSE BUILDING- land/plot upto
MODIFICATIONS IN Rs.500 lac on case to case basis.
EXTENT OF LOAN 2. Margin reduced from 40% to 25%.
AND MARGIN 3. Further, it is clarified that subsequent sale by the original allottee
of plots allotted
by the Govt. bodies be treated as the purchase from private bodies.
4. No loan shall be granted to borrowers involved in any kind of real
estate activity/business.
RETAIL PNB GEN-NEXT To bring Gen-Next customers such as IT professionals, young
ASSETS HOUSING FINANCE
executives, PSUs/
DIVISION SCHEME FOR
CIRCULAR PUBLIC PSBs/ Govt. Employees etc., into Bank’s fold, it has been decided to
NO.:17/2016
launch a new
variant of Housing loan scheme in the name of “PNB GEN-NEXT
HOUSING FINANCE SCHEME FOR PUBLIC”.
Under this scheme the borrower will be offered 1.25 times of the loan
amount calculated as per the regular housing loan eligibility method,
subject to maintenance of prescribed LTV ratio. However, borrower
may take lower amount. Further, borrower will be offered paying
lower EMIs during initial years and step up the same during the
subsequent years while recovery of entire loan amount will be
ensured within the agreed repayment period.
Objective Providing housing finance to Gen-Next salaried class borrowers such as IT
Professionals, PSBs/PSUs/Govt. Employees to have a decent home.
Age of Upto the age of 40 years.
borrower(s)
In case of multiple borrowers whose income has been taken for arriving at the loan
eligibility and repaying capacity, one borrower must be at-least upto the age of 40
years and others may be maximum upto the age of 45 years.
Occupation All salaried employees with minimum 3 years experience.
Co-borrower will also be salaried class.
Minimum Net Rs.35000/-.
monthly salary* *Net Monthly salary = Gross Salary – Statutory Deductions such as Income Tax,
PF etc.
Eligible Loan 1.25 times the loan amount calculated as per the regular housing loan method,
Amount subject to maintenance of prescribed LTV ratio. However, borrower may take
lower amount.
- Rs.20 lac;
- Need Based
Repayment Flat 30 years
Period
Moratorium In case of under construction flat of approved private builder: Upto 36 months
Period plus remaining period of date of possession subject to a maximum moratorium
period of 60 months.

the moratorium period.

Repayment Period Monthly repayment
During moratorium period Only interest to be serviced
Next 120 months EMI on sanctioned limit for 360
months
Remaining period EMI which will fully amortize the
remaining outstanding in the
housing loan account within the
remaining period
Insurance Term insurance of at-least equal to loan amount be mandatorily obtained. Cost of
premium may be financed at the option of the borrower(s). The same shall be over
and above the extent of loan, at prescribed margin, for which the customer is
otherwise eligible and subject to maintenance of LTV ratio and repaying capacity
of the customer.
 LOAN AND ADVANCES
LOANS & Rupee Export Credit - RBI vide notification no. DBR.IBD.BC.No.68/23.37.001/2015-
ADVANCES Extension of Credit 16 dated 31.12.2015 has reviewed its instructions permitting
CIRCULAR Facilities to Overseas banks in India to extend funded and/or non-funded credit
NO.02 Step-down Subsidiaries of facilities to step-down subsidiaries of the overseas arms of
Indian Corporates Indian companies and has come out with modified norms as
under:
(i) Banks may extend funded and/or non-funded credit facilities
to the step-down subsidiaries of Indian companies including to
those be yond the first level, to finance the projects undertaken
abroad.

(ii) The immediate overseas subsidiary of the Indian company

must be directly controlled by the Indian parent company
through any of the modes of control recognised under the Indian
Accounting Standards*. In addition, the Indian parent company
must directly hold a minimum 51% of its shareholding.
LOANS AND Charging of Interest on In CBS presently, FITL is not accounted by system but is done
ADVANCES Restructured Loan through manual entry. Interest is being charged by the system in
CIRCULAR Accounts (TL / WCTL / the Term Loan Account / WCTL / FITL at the time of dayend
NO. 03 FITL) on the last day of the month and wherever, funding of interest
where FITL has been on such loan accounts, is sanctioned, the same is debited to
sanctioned FITL account on the next working day, through manual
entry/vouchers. Since the amount equal to interest charged is to
be debited to FITL, it is always done after the day-end manually
after ascertaining the interest amount. Amount transferred on 1st
of subsequent month, does not reflect the true picture of balance
sheet as
on last date of quarter.
To address the above, IT Division has included a MENU
OPTION FITLTRF IN CBS and it has been made operational. It
ensures that interest charged in the Loan Accounts
(TL/WCTL/FITL and NOT IN CASH CREDIT ACCOUNTS)
on last date of month by the system is automatically
transferred to respective FITL account. IT Division has been
requested to facilitate through FITLTRF menu, transfer of
interest charged in restructured CC account to FITL account.
 Till such time, interest in charged in restructured CC account is
to be manually transferred to
FITL account, on 1st of succeeding month.
LOANS & Issuance of Guarantees in Custom Department has issued a notice that BGs issued by
ADVANCES favour of Custom banks should invariably have self renewal clause and they
CIRCULAR Department accept BG on their prescribed format. Hence, to avoid
NO.04 operational problems, the guidelines in this regard have been
amended as under:
Proposed Guidelines:
The Public Notice issued by the Customs Department stipulates,
inter alia, that all bank guarantees furnished by an importer
should contain a self-renewal clause inbuilt
in the guarantee itself. The stipulation in the Public Notice
issued by the Customs Department is akin to the notice in the
tender form floated by the DGS&D. Hence,
the provision for automatic extension of the guarantee period in
the bank guarantees shall also be made applicable to bank
guarantees issued favouring the Customs Houses.
LOANS & Service Charges – TEV The fee for conducting & vetting of TEV Studies at CO were
ADVANCES Studies Conducted / reviewed vide L&A
CIRCULAR Vetted at BO/CO/FGMO Circular No. 46 dated 09.06.2015 wherein it was decided that
NO. 05 fee will be charged @
0.10% & 0.05% of project loan plus service tax / educational
Cess / Swatch Bharat Cess respectively and FGM could permit
100% relaxation in charges for TEV Studies / vetted at CO on
merits.
3. It has been observed that fee for TEV Studies conducted /
vetted at CO is not being credited to the correct GL Head i.e.
2032502 and branches are either not levying the fees or fees
collected is being credited to different income head other than
2032502.
LOANS & Refinancing Renewable Attention of Incumbents is invited to L&A Circular No. 114
ADVANCES Energy Projects – dated 04.12.2015 advising detailed guidelines with regard to
CIRCULAR ‘IREDA-NCEF Refinance ‘IREDA-NCEF Refinance Scheme’ for Refinancing Renewable
NO. 06 Scheme’ Energy Projects (Biomass Power & Small Hydro Power Projects
upto 5 MW). It has inter-alia, been advised that the cut off date
for applying for the scheme was 14.12.2015.
IREDA has since extended the last date for submission of
 applications by the Banks under the scheme upto 01.02.2016.
Accordingly it is advised that, the application for eligible cases
may be submitted to IREDA upto 01.02.2016 as per laid down
guidelines.
We are receiving references from borrowers regarding non-
IRMD SHARING OF RATING
sharing of rating information by branches with the borrowers
Circular No PARAMETERS WITH
when the same is asked for. Therefore, all concerned are advised
24 / 2015 THE BORROWERS
to refer the above extant guidelines strictly as per above two
circulars while sharing/ disclosing rating parameters with
borrowers.
LOANS & Modifications in Ministry of Finance has informed that it has come to their notice
ADVANCES
Standardized Credit that third parties e.g. Chartered Accountants, Advocates,
CIRCULAR
NO. 09 Appraisal Format Valuers etc are involved in impressing the authorities and
influence the process of decision making related to sanction of
loans. Apparently, due to the pressure exerted on officials, the
proposals are not properly appraised on merit and subsequently
many of these loans become Non Performing Assets thereby
affecting the health of Public Sector banks.
Keeping in view the aforesaid, it is advised that services of
various professionals e.g. Legal Advisors, CAs/CSs. Architects
etc. should be used for specific and limited purposes e.g.
Valuation, Legal opinion, Certification etc as suggested in the
bank guidelines. It is reiterated that the decision of the
sanctioning authority should be based on his/her own
assessment & judgment and should not be influenced by the
borrower as well as outside professionals. The necessary
confirmation in this regard should be duly incorporated into the
credit appraisal format.
Accordingly, the standardised credit appraisal formats have been
modified by
inserting a clause in this regard as per details available in
Annexure.
LOANS & Loaning Powers- On review, it has been decided that the officials can exercise
ADVANCES Negotiation of Bills drawn
their loaning powers for negotiation of DP Bills & DA bills on
CIRCULAR under ILC
NO. 11 or before due date drawn under irrevocable ILC of approved
banks circulated by IRMD, HO from time to time.
Credit ADJUSTMENT OF Attention of all the concerned is drawn to Item No 10A of
Division
PREFERENTIAL RATE Annexure-vi, of HO: IRMD: L&A Cir No 48/2014 dated April
Circular No:
02 IN THE SYSTEM AS 23, 2014, under Discretionary Powers Vested at Various Levels
AND WHEN BASE to Permit Relaxation in Interest Rates, which inter alia reads as
RATE CHANGES under:
“ Minimum Rate of Interest: The concept of ‘Minimum rate of
interest’ is applicable in respect of cases sanctioned at
concessional/negotiated rates (i.e. rates less than the card rates
mentioned in the circular) by respective authorities. In all such
cases, the rate permitted by sanctioning authority shall be the
minimum rate and shall continue till the
period of concession allowed. Any downward change in
Reference Rate will not have any effect on these interest
rates……”
To obviate this, it has been decided that henceforth FGMOs will
maintain data of relaxations in ROI given to the customers and
submit this information to respective
ZAOs, on monthly basis. In turn, ZAOs will verify and ensure
that correct interest rates have been fed in the system and correct
rate of interest is being charged and there is no revenue loss to
the Bank on this score.
LOANS & SERVICE CHARGES- In order to avoid such instances, MD & CEO has approved
ADVANCES
INSPECTION CHARGES inspection charges to be levied in MSME & Large borrowal
CIRCULAR
NO.14 FOR SECURITY accounts as under:
VERIFICATION Aggregate Exposure Inspection Charges per annum
Up to Rs.5 lac Nil
Above Rs.5 lac & upto 0.10% of loan amount and
Rs.50 lac maximum Rs.2500/- p.a. +
service tax
Above Rs.50 lac & Rs.2500 + 0.10% of loan
upto Rs.1 crore amount above Rs.50 lac &
maximum Rs.6000/- p.a. +
service tax
Above Rs.1 crore & Rs.6000 + 0.05% of loan
upto Rs.5 crore amount above Rs.1 crore &
maximum Rs.18000/- p.a. +
service Tax
Above Rs.5 crore to Rs.18000 + 0.01% loan
Rs.10 crore amount above Rs.5 crore &
maximum Rs.22500/- p.a. +
 service Tax
Above Rs.10 crore Rs.22500 + 0.005% loan
amount above Rs.10 crore &
maximum Rs.30000/- p.a. +
service Tax
LOANS & Rate of Interest - Scheme Attention of Incumbents is invited to MSME Division Circular
ADVANCES
for financing People with No.17/2013 dated 07.06.2013 advising that our Bank has
CIRCULAR
NO.15 Disabilities (PwDs) under entered into Memorandum of Agreement (MoA) on 03.06.2013
100% refinance for availing of refinance
arrangement with National from NHFDC for extending concessional loans under MSE
Handicapped Finance and segment forincome generating activities to People with
Development Corporation Disabilities (PwDs). Consolidated guidelines on the scheme
(NHFDC) have been circulated vide MSME Division Circular No.71 dated
25.09.2014.
Under the said arrangement, the Corporation will provide 100%
refinance at 3% lower ROI against the financial assistance
extended by the bank.
Now, Audit Committee of Board has advised that stipulation
LOANS & Submission of Unhedged may be made in the sanction terms for submission of Unhedged
ADVANCES
Foreign Currency Foreign Currency Exposure to Bank on regular basis in terms of
CIRCULAR
NO.18 Exposure (UFCE) RBI guidelines. Accordingly, sanctioning authorities, while
in the Sanction Terms sanctioning credit proposals are advised to stipulate submission
of UFCE in the sanction terms on regular basis, without fail.
To obviate references to various circulars, the operative
LOANS & CONSOLIDATED instructions/guidelines on CERSAI have been consolidated and
ADVANCES
CIRCULAR- FILING OF are available as per Annexure.
CIRCULAR
NO.19 PARTICULARS OF
TRANSACTION WITH
CENTRAL REGISTRY
(CERSAI)
It has been decided that amount in default of devolved/invoked
DPG/LC/LG/Co-Accepted Bills will be directly debited to the
LOANS & DISCONTINUATION
main operating account of the customer (CC/OD/CA) in the
OF DUE DATE
ADVANCES transaction system (CBS) itself w.e.f. 01.04.2016 and remittance
DEFAULT (DDD)
made. The Controlling Office will be apprised of it and follow
CIRCULAR ACCOUNT
up steps/remedial action for regularization of such accounts will
NO.20 be taken.
To facilitate operations in the account, tagging may be allowed
by competent authority in terms of extant guidelines. The tagged
amount out of each credit would be retained in the operating
account of the borrower and DP will be raised accordingly by
manual procedure. Balance amount, reflected in the CBS system
may be availed by the party.
LOANS & SERVICE CHARGES- In case of various retail loan schemes issued by Retail Asset
ADVANCES
INSPECTION CHARGES Division, HO, the
CIRCULAR
NO.22 FOR SECURITY guidelines on periodicity of visit to the site of mortgaged
VERIFICATION IN property have been prescribed without specifying inspection
RETAIL LOANS charges, which sometimes results in revenue loss.
In the above backdrop, some modifications in the norms of
LOANS & Takeover of Retail Loan eligibility criteria for take over of Retail loans inter-alia
ADVANCES Accounts
including waivement of prior approval from the next higher
CIRCULAR
NO.23 authority, subject to compliance of other parameters, relaxation
in the criteria of Credit Risk Rating, Sharing of Information etc.
have been carried out, which have been approved by Board in its
meeting dated 29.03.2016.
Credit Management & Risk Policy for the year 2016-17, duly
approved by the Board is enclosed as Annexure.
LOANS & CREDIT
MANAGEMENT & RISK
ADVANCES
POLICY FOR THE
CIRCULAR YEAR 2016-17
NO.21
 IRMD

IRMD Circular Consolidated Circular The Guidance Note on Management of Operational Risk issued by
RBI requires the banks to capture all individual data relating to
No.: 02 / 2016 - Internal Operational
losses arising out of Operational Risk, as it is an essential pre-
Risk Loss Data requisite for development of an effective Operational Risk
Management Framework.
Collection Framework
In accordance with the above requirement, our bank is maintaining
a central repository of Internal Loss Data since 2004-05. This
repository, maintained by the Operational Risk Management
Department (ORMD), IRMD, HO acts as a central storage and
focal point of internal loss data for Management and measurement
of operational risk. Such a database,
ank management regarding losses
arising out of Operational Risk.

their management and mitigation.

-wide perspective of Operational Risks faced
by the bank.
he bank to graduate to more evolved means of capital
allocation for operational risk and migrate to advanced approaches
for Operational Risk.

Now, with the stabilization of ‘OpRisk Solution’, and to dispense

with the duplication of data capturing work, i.e. capturing of data
1st in ‘Loss Data Utility’ and subsequently in ‘SAS OpRisk
Solution’, it has been decided to discontinue the ‘Loss Data
Utility’.

As per the revised methodology, the losses captured in CBS

against these 8 revenue sub-codes for Head Office (HO) Divisions
& Zonal Audit Offices (ZAOs) [6 revenue sub-codes for offices
other than HO Divisions & ZAOs] have been mapped to most
appropriate Business Line (BL) & Operational Risk Category
(ORC) and data is automatically flowing into ‘SAS OpRisk
Solution’ through EDW. Events corresponding to these codes are to
be updated at Circle Office & HO Divisions, for Brief History and
correct BL & ORC mapping in ‘SAS OpRisk Solution’ directly.

Internal Loss Data Collection Framework‟ has now been revised

keeping in view the above facts. The revised „Internal Loss Data
Collection Framework‟ is attached as Annexure to this circular.

IRMD Circular Consolidated Circular Guidelines for collection and submission of Internal Loss data were
last circulated vide IRMD Circular No. 09/2014 dated 13.02.2014.
No: 03 / 2016 - Guidelines for
Collection and 2. Internal Loss Data Collection Framework has been revised
incorporating latest changes/amendments and circulated vide
Submission of Internal
IRMD circular 02 / 2016 dated 13.01.2016.
Operational Risk Loss
3. Consequent on revision in the Internal Loss Data Collection
data
Framework, the revised guidelines for collection / submission of
internal loss data are given in the Annexure.
4. The success of Operational Risk Management depends on the
 correctness, completeness and timely submission of loss data. As
such all offices shall capture/submit the loss data at the prescribed
periodicity as mentioned in the Annexure.
5. In case any clarification/guidance is required, Operational Risk
Management Department (ORMD), HO-IRMD may be contacted.

IRMD MID CORPORATE Mid Corporate Rating Model is used for rating borrowers seeking
CIRCULAR NO. RATINGMODEL –
limits above Rs. 5 Crore and up to Rs. 15 Crore or having annual
04 /2016 CHANGES IN THE
MODEL turnover above Rs. 25 Crore and up to Rs 100 Crore. Also, all large
corporate trading concerns irrespective of limits and turnover are
rated under this model only.
In line with RBI guidelines, parameter validation exercise of Mid
Corporate Rating Model has been carried out based on the
historical rating data available in the central server of PNBTrac.
The statistical results were placed to the Credit Risk Management
Committee, which approved certain changes in the model.
Necessary changes in the software have been carried out and
deployed in the production server of PNB Trac.
There are some changes in the benchmarks of the parameters under
Financial and Management Evaluation and Weightage of Financial
and Conduct evaluation which are given under Annexure I.
IRMD / ALM Revision in Rate of The rates of interest on Domestic Term Deposits, NRE Term
DEPOSIT CIR.
Interest on Domestic Deposits and PNB Tax Saver Fixed deposits were last revised vide
NO. 04/2016
Term Deposits IRMD/ALM Deposit circular no. 20/15 dated 21.11.2015.
Now, it has been decided to increase the interest rates on Domestic
term Deposits of Rs. 1 cr. to Rs. 10 cr. as under:
In the maturity bucket of 7 days - 45 days, from 4.00% to 5.00%.
In the maturity bucket of 46 days – 90 days, from 5.00% to 6.00%.
In the maturity bucket of 91 days – 179 days, from 5.75% to 6.00%.
All other interest rates shall remain unchanged.
INTEGRATED Digital Evidence The Digital Evidence Policy has been reviewed for the FY 2016-17
RISK Policy for Financial
and certain changes have been approved by the Board in its meeting
MANAGEMENT Year 2016-2017
DIVISON held on 29/03/2016. Revised Information Security Policy document
CIRCULAR NO.
for the FY 2016-17 incorporating the changes is placed at
03/2016
Annexure.
The Board in its meeting dated 29th March 2016 has approved the
Credit Risk Credit Risk Mitigation & Collateral Management Policy of the
IRMD Cir. No.
Mitigation & bank for the year 2016-17.
11 / 2016
Collateral
Management Policy
For the F.Y. 2016–17
 INTEGRATED The annual review of Policy on “Business Continuity Plan” with
RISK Policy on Business certain changes for F.Y. 2016-17 has been approved by the Board
MANAGEMENT in its meeting held on 29.03.2016. Revised Policy on “Business
Continuity Plan for the
DIVISION Continuity Plan” document for the F.Y. 2016-17 incorporating the
CIRCULAR NO. F.Y. 2016-17 changes is placed at Annexure.
07 / 2016
The annual review of Policy for Mapping of Business
INTEGRATED Policy for Mapping of Lines/Activities with certain changes for F.Y. 2016-17 has been
RISK approved by the Board in its meeting held on 29.03.2016. Revised
Business
MANAGEMENT Policy for Mapping of Business Lines/Activities document for the
DIVISION Lines/Activities for F.Y. 2016-17 incorporating the changes is placed at Annexure.
CIRCULAR NO.
the F.Y. 2016-17
08 / 2016
INTEGRATED The annual review of Policy for Approval of New Product with
RISK Policy for Approval certain changes for F.Y. 2016-17 has been approved by the Board
MANAGEMENT of New Product for the in its meeting held on 29.03.2016. Revised Policy for Approval of
DIVISION F.Y. 2016-17 New Product document for the FY 2016-17 incorporating the
CIRCULAR NO. changes is placed at Annexure.
09 / 2016
The annual review of Operational Risk Management Policy with
INTEGRATED Operational Risk certain changes for F.Y. 2016-17 has been approved by the Board
RISK Management Policy in its meeting held on 29.03.2016. Revised Operational Risk
MANAGEMENT for the F.Y. 2016-17 Management Policy document for the FY 2016-17 incorporating
DIVISION the changes is placed at Annexure.
CIRCULAR NO.
10 / 2016

GBD
GBD SOVEREIGN GOLD The Bonds shall be restricted for sale to resident Indian entities
CIRCULAR BOND 2015-16 including
NO.7/2016 SECOND TRANCHE individuals, HUFs, trusts, Universities and to the Charitable
Institutions. The
Bonds shall be denominated in units of one gram of gold and
multiples thereof.
Minimum investment in the Bonds shall be 2 grams @ Rs. 2600/-
per gram with a
maximum subscription of 500 grams per person per fiscal year
(April – March). In case
of joint holding, the limit applies to the first applicant. Price of the
Bonds shall be fixed
in Indian Rupees on the basis of the previous week’s (Monday-
Friday) simple average
closing price of gold of 999 purity, published by the India Bullion
and Jewelers
Association Ltd (IBJA). The Bonds shall bear interest at the rate of
2.75 per cent (fixed
rate) per annum on the amount of initial investment. Interest shall
 be paid in half yearly
rests and last interest shall be payable on maturity along with the
principal. As such, it
is mandatory for the investors to provide bank account details to
facilitate payment of
interest/maturity value. No post maturity interest is payable to
Investors.
All branches shall accept applications on Form ‘A’ and Nomination
Form “D” enclosed stating clearly the grams of gold and the full
name and address of the applicants along with copy of KYC
documents (any one of Passport/Aadhar/PAN/TAN/Voter ID No)
and cheque/Demand Draft/Cash etc. and nominee details.
GOVERNMENT Mandatory quoting of As per latest guidelines issued by CBDT dated 15th December
BUSINESS PAN number of e‐
2015 and Stock Holding Corporation of India Limited letter dated
DIVISION Stamping transaction
CIRCULAR NO above 2 lakhs 18th January 2016, disclosure of PAN have been made mandatory
GBD / 9 / 2016
for all transactions above Rs. 2 lakhs.
In view of the same, branches are advised to implement the
following guidelines.
• With effect from 1st January 2016, PAN number for all
transactions above Rs. 200000/‐ (Rupee Two Lakhs only)
in e‐ Stamping has been made compulsory.
• Ensure that the PAN number, required to be quoted, should be
of the person whose name has been given as the payer of
the stamp duty, in e‐ stamping application form.
• Citizens not having PAN Card are required to fill up Form 60.
• In case of additional certificate if the combined value of base
certificate and additional certificate/certificates exceeds Rs.
2 lakhs, PAN has to be obtained in the application form and
captured in the system on a mandatory basis.
GBD Circular ISSUE OF 10 COINS “The Government of India has minted 10 coins to commemorate
No. 17 / 2016
TO the occasion of "125th birth anniversary of Dr. B. R. Ambedkar"
COMMEMORATE which the Reserve Bank of India will shortly put into circulation.
THE OCCASION OF
"125TH BIRTH
ANNIVERSARY OF
DR. B. R.
AMBEDKAR"
GOVERNMENT TDS on Sale of In this regard, the steps to be taken by all the branches, for
BUSINESS Property – Acceptance
acceptance of Form 26QB challan from the tax payer and to
DIVISION of challans and
CIRCULAR No Correction on Form facilitate them in making payment of this tax electronically, have
18 / 2016 26QB
already been circulated vide Circular No. GBD/95/2013 dated
28.06.2013. The same is reproduced as under:
a) All branches have to open a current account (in which tax
amount deposited by the tax payer be credited) and to obtain
corporate internet user id and password, to make online payment on
behalf of the tax payer, from this account.
b) With the printout of the acknowledgment slip generated from the
site www.tinnsdl.com, the taxpayer may visit any of our branches
to make the payment of TDS subsequently.
c) Based on the information in the acknowledgment slip, branch
will make the payment only through net-banking facility by visiting
www.tin-nsdl.com.
d) On the above URL, the branch after selecting E-tax payment on
subsequent date,have to enter details such as PAN of Transferee &
Transferor, ACK No. and Assessment Year as per acknowledgment
slip provided by the taxpayer.
GBD Circular Submission of Life As a pensioner friendly measure, facility to obtain Digital Life
No. 19 /2016 Certificate at branches Certificate (Jeevan Pramaan) has also been provided to relieve
– Guidelines hardship to pensioners, particularly to those who are aged or are
issued from time to infirm. Jeevan Pramann uses Aadhaar Platform for biometric
time authentication of a pensioner. Procedure for submission of Digital
Life Certificate (Jeevan Pramaan) at our branches through CBS
Portal is elaborated alongwith process
flow vide GBD Circular No.82/2015 dated 29.9.2015 to be
followed in case a pensioner wants to obtain his/her Life Certificate
digitally.
On complaints received from Pensioners’ Associations, officials
from Ministry madeincognito visits in the branches and observed
that acknowledgement is not being issued to pensioners as per new
format of LC and old formats are being used. Further, Jeevan
Pramaan Software was not found configured in some of the
branches and pensioners were denied facility of submitting LC
digitally. Authorities have taken a serious view of it and have
desired to sensitize the field staff in this regard.
GBD Circular Implementation of The orders contained in above referred Circular shall be applicable
No. 20/2016
‘One Rank One to all pensioners / family pensioners who had
Pension’ to Defence retired/discharged/invalided out from service/died in service or
pensioners except after retirement in the rank of Commissioned Officers, JCOs/ORs
Defence Civilians and Non-Combatants (enrolled), Army, Navy, Air Force, Defence
Security Corps, Territorial Army and who were/are in receipt of the
following types of pension as on 1.7.2014 :
a) Retiring Pension/Service Pension /Service Element of Disability
Pension/Service Element of War Injury Pension/Invalid Pension
b) Enhanced Rate of Ordinary Family Pension
c) Normal Rate of Ordinary Family Pension
d) Special Family Pension
e) Special Dependent Family Pension/2nd Life Award of Special
Family Pension
f) Liberalized Family Pension
g) Liberalized Dependent Pension /2nd Life Award of Liberalized
Family Pension
h) Disability Element of Disability Pension
i) War Injury Element of War Injury Pension (Discharge)
j) War Injury element of War Injury Pension (In Invalided out)
k) Pre 01.06.1953 Discharged Personnel
GBD Circular WITHDRAWAL OF Now, RBI, Deptt. of Currency Management, Mumbai vide its letter
No.22 / 2016 ALL OLD SERIES
no. DCM(Plg) No.G-
OF BANKNOTES
ISSUED PRIOR TO 9/2856/10.27.00/2015-16 dated 11.02.2016 has reiterated the
2005
instructions and advised
to facilitate the exchange of Pre-2005 all series of banknotes
without causing any
inconvenience to the public. These notes will retain their legal
tender status.
In view of the above, all concerned are advised as under:-
of exchange of such notes to be extended without
causing any inconvenience to the public, whatsoever.
-2005 series of banknotes are not dispensed
through ATMs/over the counters.
GBD SOVEREIGN GOLD Reserve Bank of India vide their letter no.RBI/2015-16/333
CIRCULAR
BOND 2016 - IDMD.CDD No.2020/14.04.050/2015-16 dated 4th March, 2016
NO.23 /2016
SERIES II has conveyed the Government of India’s Notification F.No. 4(19)-
W&M/2014 dated March 04, 2016 announcing that the
 Sovereign Gold Bonds, 2016 (“the Bonds”) will be open for
subscription from March 8,
2016 to March 14, 2016. The Government of India may, with prior
notice, close the Scheme before the specified period.
GBD Circular Restoration of 1/3rd Ministry of Personnel, Public Grievances & Pensions, Govt. of
No. 24/2016 commuted portion of
India vide Office Memorandum dated 17.2.2016 has informed that
pension in respect of
Government servants notional full pension of absorbee pensioners would also be revised
who had drawn lump-
in accordance with the instructions contained in their Office
sum payment on
absorption in Central Memorandum No. 38/37/08-P&PW(A) dated 30.7.2015 (GBD
Public Sector
Circular No, 66/2015 dated 5.8.2015 ) w.e.f. .1.1.2006 instead of
Undertakings/Central
Autonomous Bodies – 24.09.2012 and Dearness Relief and additional pension for old
Stepping up of
pensioners would be admissible on such revised notional full
notional full pension
w.e.f. 1.1.2006 for the pension.
purpose of Dearness
Relief and additional
pension for old
pensioners – Central
Civil
GBD Circular Grant of family Ministry of PPG & P, Deptt. of Pension & Pensioners’ Welfare,
No.25/2016
pension to a disabled Govt. of India vide OM No. 1/18/2001-P&PW(E) (Vol.II) dated
child/sibling - 25/27.1.2016 have clarified to Railways that :
Railways - Non-intimation of physical /mental handicap does not make a
person ineligible for family pension.
- A disability certificate issued after the death of the
employee/pensioner or his/her spouse for a disability which existed
before their death may be accepted by the appointing authority if he
is satisfied that (i) it renders him or her unable to earn a living (ii)
he/she was suffering from that disability on the crucial date, i.e. on
the date of death of pensioners/employee or his spouse, whichever
was later.
- If a disability certificate has been obtained for a permanent
disability previously, there is no requirement of obtaining a
disability certificate afresh.
GBD (Pension) Submission of Digital As desired by DPPW, Department of Financial Services, Ministry
Circular No.
Life Certificate (DLC) of Finance, Govt. of India has reiterated that a pensioner can submit
27/2016
through Jeevan his/her Life Certificate either through the conventional method or
Pramaan Facility availing the DLC methodology. Given the inherent benefits of DLC
especially for very senior pensioners, banks could encourage the
pensioners, especially the old and infirm, to adopt this
methodology. However, as adoption of DLC is a voluntary decision
of the pensioner, it may be ensured that there is no discrimination
against those pensioners who choose to submit the life Certificate
through the conventional means. To further promote adoption of
DLC, banks may facilitate pensioners who voluntarily offer to have
their Life certificate submitted online through the Jeevan Pramaan
facility and provide necessary assistance for linking Aadhar number
of the pensioner with their pension accounts.
 IAD
IAD Permanent Account Government of India, Ministry of Finance, Department of Revenue,
CIRCULAR Number (PAN) Centre Board of Direct Taxes vide notification dated 30.12.2015
No 02/ 2016 has made the following rules further to amend the Income Tax
Rules, 1962.
1. (i) these rules may be called the Income–tax (22nd Amendment)
Rules, 2015.
(ii) Rules 114B, 114C and 114D shall come into force from the 1st
day of
January, 2016 and rule 114E shall come into force from the 1st day
of April,
2016.
2. In the Income-tax Rules, 1962 (hereinafter referred to as the said
rules), for rules 114B, 114C, 114D and 114E, the following rules
shall respectively be substituted, namely:-
“114B transactions in relation to which permanent account number
is to be quoted in all documents for the purpose of clause (c) of
sub-section (5) of section 139A.
Every person shall quote his permanent account number in all
documents pertaining to the transactions specified in the Table of
the circular.
IAD Standardization of The Reserve Bank of India had updated the Cheque Return
CIRCULAR Reasons and Codes in the CTS Clearing Table to synchronize with
Return Reasons and
the Return Reasons and Codes as per Annexure D of the Uniform
NO. 3 / 2016
Codes in CTS Clearing Regulations and Rules for Bankers’ Clearing Houses (URRBCH)
dated May 17, 2012. Presently Mumbai, New Delhi and Chennai
Table- Uniform
Clearing Houses are functioning under ‘Cheque Truncation
Regulations and Rules System’ (CTS). More Clearing Centres are being migrated to CTS
with the passage of time.
for Bankers’ Clearing
Houses (URRBCH) The Return codes mentioned in Annexure-D of URRBCH are
applicable for both (Instrument and Image-based Cheque Clearing).

The comprehensive list of the Return Codes is given in Annexure-I

of the circular.
IAD Processing of Audit The processing of Audit Reports & their finalization of rating /
CIRCULAR Reports/ Marking-off marking off irregularities/ closure of Audit Reports of all branches
LETTER NO. irregularities/ (except LCBs, Foreign Branches, Back Office of Foreign Branches,
03/2016 Rectifications / Closure OBU, CBOTF & identified HO Divisions under concurrent audit)
of is done by Zonal Audit Offices.
Audit Reports and On receiving queries/ suggestions from ZAOs regarding
Monitoring of Marked processing, marking off/ dropping of audit irregularities, it has been
for Audit Purpose decided to revise/ reiterate the system of processing of audit
 (MAP) items reports, marking off/ dropping of irregularities, its rectification
percentage and finally, closure of the audit reports
INSPECTION LEGAL AUDIT OF For conducting Legal Audit in loan accounts with credit exposures
& AUDIT
TITLE DOCUMENTS of Rs.5 crore and above, ZAOs were advised vide our letter dated
DIVISION
CIRCULAR IN RESPECT OF 05.07.2013. Subsequent changes were also advised from time to
LETTER NO.
LARGE VALUE time. A need was also felt to prescribe periodicity of such legal
04/ 2016
LOAN Audit. The relevant guidelines are now given hereunder for
ACCOUNTS. meticulous compliance of all concerned.
For conducting Legal Audit, two main functions are to be done by
concurrent auditors in such accounts:
i) Verification of Title Deeds
ii) Verification of other documents relating to Title Deeds.
Concurrent Auditor conducting Legal Audit should cover the under
mentioned points:
of IP
-Law Division
has clarified that the auditor can also refer to the Check-List
mentioned in Annexure VI to Law Division Circular no.
13/Law/2013 dated 18.06.2013 and by suitably answering the
aspects mentioned therein [except item no. 5 ( c )], he can complete
the verification.

the name of Company.

- Self assessment.

of Advocate. All terms

and condition stands complied and enforceability of Equitable
Mortgage.

y be got done
by the Auditor at that Centre.
It is advised to conduct PERIODIC legal audit. Executive
Committee in its meeting held on 09.02.2016 vide, its resolution
no. 5 has approved the following periodicity for conducting Legal
Audit:
i) In case of fresh sanctions, first time Legal Audit be conducted in
the next quarter of
 sanction date/Mortgage date.
ii) Subsequent Legal Audit be conducted in eligible standard
accounts after every three
years or wherever there is a enhancement in limits/change in
securities (IP) i.e. offering fresh security or substitution of existing
IP.
FRMD Telephonic Recently many cases of cheque related frauds have been
CIRCULAR Confirmation of high
perpetrated in our bank where original cheques are in possession of
NO. 5/2016 value cheque from the
account holder before account holder whereas forged cheques which have been paid have
making payment of the
all security features. When these Cheques were examined by
cheque.
technical committee at Printing and Stationary Department Noida it
was observed that some vital fields seem to be tampered/altered
which sometimes escapes attention of the passing officials. This
modus operandi is common in many banks. Earlier RBI had also
suggested alerting the customers by phone calls and getting the
confirmation from the drawer. Hence as a matter of extra
precaution field functionaries are being advised that high value of
cheque of Rs. 2 lac and above may be confirmed from the account
holder telephonically before transfer and cash payment and a
noting to this effect be made on the back of cheque leaf to avert
this type of fraud. However, customer availing PNB Suraksha be
excluded.
IAD REVENUE AUDIT – Undercharges have also been reported on account of short charging
CIRCULAR
UNDERCHARGES – of interest, which happen mainly due to the incorrect entry of
No. 04/2016
REPORTING & interest table code/ linkage of rate of interest with BPLR/ BR
RECOVERY adding term premia. Despite guidelines being reiterated time and
again regarding charging of interest and service charges, feeding of
proper and complete data in the system, undercharges are being
detected repeatedly by the auditors. Proper implementation of
guidelines is lacking in the field due to negligence. Detection of the
undercharges attract action again the erring officials.
We once again reiterate the guidelines regarding initiation of staff
accountability against the erring official for undercharges as under:
In cases where malafide, gross negligence, dereliction of duty and
repetitive nature of undercharges (even in single account) is
pointed out by the auditor, staff accountability action is required to
be initiated at Circle Office level/FGM Office level (in case of
LCBs), irrespective of amount involved.
 While submitting Revenue Audit Report, auditor is also required to
indicate the name of erring officials in cases where undercharges
are Rs. 5000/- & above besides comments on staff accountability.
In cases where continuous leakage of revenue in a branch in any
particular account(s) is pointed out by auditor(s), or observed
otherwise, staff side accountability be initiated along with the
vigilance overtone by Circle Heads/ FGMs (in case of LCBs).
In case vigilance overtone is perceived, such instances will be
referred to the Internal Advisory Committee (IAC), IAD HO for
examining the same.
On receipt of decision of the competent authority (CVO) on the
vigilance overtone, disciplinary action will be initiated by the
Disciplinary Authority, against the erring officials.
IAD CONCURRENT Concurrent Audit Policy for the financial year 2016-17 has been
CIRCULAR AUDIT POLICY FOR
reviewed by the Board in its meetings held on 29.02.2016 vide
LETTER NO. THE FINANCIAL
05/ 2016 YEAR 2016-17 resolution no.18 on the lines of the RBI’s revised Guidelines for
Concurrent Audit System in Commercial Banks.
Following changes have been incorporated in the reviewed policy
for the financial
year 2016-17: -

by bank's own staff or external auditors (which may include bank’s

own retired staff) is left to the
discretion of individual banks

Rs.50 crore to Rs.25

crore

65 years, capped in the Policy.

IAD SIGNIFICANT AUDIT During the course of FEMA Audit for the financial year 2014-15
CIRCULAR
FINDINGS (as at 31.03.2015) in the AD branches, the auditors have found
No. 05/2016
OBSERVED DURING following serious irregularities/ FEMA violations:-
FEMA AUDIT- FY
2014-15 USD 1.00 lac (or its equivalent) & above is not found in few of the
branches.

remittances within prescribed time period and due diligence in the

 matter is not being ensured and necessary follow up is not made. In
some of the Branches sudden spurt has been noticed in case of
advance remittances against imports upto USD 1.00 lac and its
equivalent without adhering to norms of KYC/AML guidelines and
obtaining bills of entry within stipulated time.

Bills of entry not given to the customers in few of the Branches.

case of overdue export bills
already reported in XOS statement is not being done in some of the
branches.

permissible remittances) either not obtained or being received late

in a few accounts.

IAD OPENING/ We have now been informed by RBI vide circular no.
CIRCULAR
OPERATING BANK DBR.No.Leg.BC.78/09.07.005/2015-16 dated 11.02.2016 that the
No. 06/ 2016
ACCOUNTS OF banks are insisting on guardianship certificate from all mentally ill
PERSONS WITH persons. In this regard it is clarified that paragraph 2(iii) of RBI’s
MENTAL ILLNESS & aforesaid circular dated January 13, 2014 (Para 44 (a) iii of our
WITH DISABILITIES Book of instructions (operations) chapter IV) is not intended to
LIKE AUTISM, mandate banks to insist on appointment of a guardian as a matter of
CEREBRAL PALSY, routine from every person "who is in need of treatment by reason
MENTAL of any mental disorder". It would be necessary for banks to seek
RETARDATION AND appointment of a guardian only in such cases where they are
MULTIPLE convinced on their own or based on documentary evidence
DISABILITIES. available, that the concerned person is mentally ill and is not able
to enter into a valid and legally binding contract.

FINANCE

Circular No. PAYMENT OF

As per provisions Reverse Charge Mechanism for payment of
Service Tax is applicable on several services, to quote a few are as
FD/ 02 /2016. SERVICE TAX
under:-
UNDER REVERSE
CHARGE
MECHANISM

Hence, in order to segregate the expenditure specifically covered

under Reverse Charge for service tax purposes, separate accounting
codes have been opened by IT Division for booking expenditure
 covered under Reverse charge to facilitate correct filing of Service
Tax return(ST-3) and detailed guidelines were circulated vide our
Circular No. FD/HO/18/2014 Dated 02.09.2014.
The reports relating to Service Tax Calculation, CENVAT Credit
etc. are available in CBS System and it should be ensured by the
Circle Offices that ST-3 Returns are reconciled with the available
reports before filing/submission to Service Tax Deptt. and proper
record of reconciliation is maintained and also made available to
concerned Service Tax Authorities during course of Audit. (MENU
OPTION—DAY RPT-10/59,59a, 2159b and 11/1,2,3,4,5,6)
CIRCULAR Procedure for Form The Principal Director General of Income Tax (Systems) vide
NO HO / FD
15G & H Notification No 4/2015 dated 01.12.2015 have specified the
/05 / 2016
procedures, formats and standards for the purpose of furnishing and
verification of the declaration, allotment of Unique Identification
number and furnishing or making available the declaration to the
Income Tax Authority. The major features of the aforementioned
Notification are as below: 1. Allotment of UIN (Unique
Identification Number): As per the revised procedure effective
from 01.10.2015, the branches are required to allot a Unique
Identification Number (UIN) to each Form 15G/ H during every
quarter of the Financial Year in following manner:
UIN shall consist of following three fields (a), (b) and (c)
(a) Sequence Number (10 alphanumeric for Form 15G/15H) given
as follows
15G : 10 alphanumeric characters starting with G followed by 9
digits (Eg. G000000001)
15H: 10 alphanumeric characters starting with H followed by 9
digits (Eg. H000000001
(b) Financial year for which declaration is being furnished
(c) TAN of the Branch/ office
ITD-CBS is in process of making necessary changes in system to
capture the revised Form 15G / H and to generate the UIN and
guidelines will be issued separately.
CIRCULAR Deduction of Income Attention is invited to FD Consolidated Circular No.19/2015 on
NO. HO / FD
tax at source from deduction of Income tax at source from salaries for FY 2015-16. In
/06 / 2016
salaries for FY 2015-16 respect of calculation of perquisite value on Interest free loan or
loan at concessional rate of Interest, SBI interest rates as on 1st
April, 2015, as given in Direct Tax Ready Reckoner (Taxmann),
 are as under
Type of loan Rate of Interest
Two Wheeler Loans 18.25%
Housing Loans 10.15 % p.a (For women
Borrowers rate @ 10.10%)
Car Loan for new car 10.45 % p.a (For women
Borrowers rate @ 10.40%)
Personal Loan 18.50% p.a
FINANCIAL Introduction of Presently, Aadhaar seeding facility is available at our branches to
INCLUSION “Aadhaar Seeding customers through “UIDNUM” menu in CBS under Maker-
DIVISION facility at Business Checker mode, which is done on the request of the customer. The
CIRCULAR Correspondent (BC) request for Aadhaar seeding is also received through Alternate
NO. 04/2016 Locations” through Delivery Channels (ADC) i.e. Internet Banking, ATM & SMS and
Kiosk Banking Solution such requests are seeded on centralized basis after demographic
(KBS) authentication from UIDAI data base through “Demo Auth”
process.
Now, Bank is extending the Aadhaar Seeding facility at BC
Locations in addition to Branches and Alternate Delivery Channels
(ADC).
FINANCE MANUAL FOR Like in previous years, this year also Manual is issued in soft copy
DIVISION ANNUAL
only as part of "Green initiative" of the Bank and no printed copy
CIRCULAR ACCOUNTS 2015-16
NO. FD::BS: of the Manual will be issued.
07/2016
Similarly submission of LFAR & Tax Audit Report will also be by
soft copy through CFA (a new web application) and no hard copy
needs to be submitted.
This Manual not only provides complete instructions/guidelines at
one place but also enables to complete the entire audit process
smoothly and well in time.
In this direction, 14th Edition of Manual containing closing
instructions / guidelines from all Head Office Divisions have been
incorporated for Annual Audit of Financial Year 2015-16.

FINANCIAL Remuneration to In order to compensate the BC agent and to accelerate the process
INCLUSION
Business of Aadhaar seeding, Board of Bank in its meeting dated 29.02.2016
DIVISION
INTERNAL Correspondents (BCs) has approved the following remuneration structure.
CIRCULAR
for Seeding of Aadhaar Particulars Remuneration to Business
LETTER NO.
07/2016 Number and Activation Correspondents
of RuPay Cards. Aadhaar Seeding at Remuneration of Rs.5/- to Business
BC location
Correspondents for every successful
seeding of Aadhaar number in the
 bank account (One time per account),
opened at his/her location. Aadhaar
seeding in respect of accounts which
have not been opened at his/her
location, remuneration amount will
be Rs.2/- (One time per account).
RuPay Cards Remuneration of Rs. 5/- would be
Activation by BCA paid to BCAs for every successful
through Micro- activation (one time per account) to
ATMs compensate for their efforts for
activation of RuPay Cards by way of
initiating financial/non-financial
transactions in the Bank accounts
opened at his/her location and the
base branch only.

Financial Delivery of demand For delivery of recovery notices in NPA accounts in service area
Inclusion villages, the BC will be paid a remuneration, being the delivery
notices by BCAs in
Division charges @ Rs 10/- plus applicable service tax per notice/envelop.
Circular No. NPA accounts Instances may be possible that few borrowers have left the village.
7/2016 For such cases, if BCA provides authenticated changed address/
mobile no., a sum of Rs.5/- plus applicable service tax per case will
be paid. The BCA will be assigned this job of delivery of demand
notices in his Sub Service Area (SSA) i.e. allocated villages only.

Process flow for issuing notices will be as under:

by providing acknowledgement of borrower regarding delivery of

of the payment made from Circle Office on monthly basis.

CIRCULAR Handling of Form 15 G It has come to our notice that branches are accepting Form 15G/H
NO. FD / 09 where the aggregate of the amount of such income credited or paid
/ 15 H in CBS
/2016 or likely to be credited or paid during the Financial year exceeds
the maximum amount which is not chargeable to tax i.e crossing
the exempted income tax limit and CBS system is not deducting
TDS.
The exempted income tax limit in different categories at present
are:

during the previous year but less than 80 years on the last day of
the previous year) Upto Rs. 3,00,000.

time during the previous year i.e born before April 1, 1934) upto
Rs 5, 00,000.
 Exemptions on account of submission of Form 15G/H: New TDS
rate codes have been created in the system based upon the
prescribed threshold income limits for the financial year 2015-16
(Assessment Year 2016-17), which shall deduct TDS automatically
at the specified rate when the interest payment amount shall exceed
of prescribed income limit at the time of TDS calculation. Branches
are advised to enter applicable rate codes only in CUMM – TDS
rate code field for handling TDS exemptions against submission of
Form 15G & H. In case of Customers having submitted Form-15H
and are eligible for exemptions under Chapter-VI or set off of Loss
of „Income from house property‟, branches are advised to enter the
applicable amount of deductions ,as per Income Tax rules, in
Customer Floor limit for TDS in CUMM . Utmost care should be
taken at the time of feeding this value ,based upon the declaration
submitted by the Declarant , so that income tax provisions are
complied with.
REMITTANCES TO
CIRCULAR NON RESIDENTS – The Rule 37BB of the Income Tax Rules 1962 has been amended
NO. FD / 10 OBTAINING OF by the Central Board of Direct Taxes (CBDT), vide its notification
/2016. UNDERTAKING no.93/2015 dated 16.12.2015 and new Form 15CA and Form 15CB
(FORM 15CA) AND has been inserted. The amended rule 37BB and new Form no.15CA
CERTFICATE OF and 15CB are applicable with effect from April 1, 2016
CHARTERED
ACCOUNTANT
(FORM 15CB)
 MISD
MISD Changes in CERSAI, vide their notification dated 01/02/2016, has drastically reduced the
Circular
CERSAI fee fees for various transactions with effect from 01/02/2016. The revised fee is as
No.02/2016
charges under:
Nature of Existing Fee Revised fee
Transaction to be registered
Particulars of For creation and For creation and
creation or for any for any
modification of subsequent subsequent
Security Interest modification of modification of
in favour of security interest security interest in
Secured in favour of favour of
Creditors a secured creditor a secured creditor
for a loan for a loan
1) Up to Rs.5 lac 1) Up to Rs.5 lac –
– Rs.250/- Rs.50/-
2) Above Rs.5 2) Above Rs.5 lac
lac –Rs.500/- – Rs.100/-
Satisfaction of any existing NIL NIL
Security Interest
Particulars of securitization or Rs. 1000/- Rs. 500/-
reconstruction of financial assets
Particulars of satisfaction of Rs. 250/- Rs. 50/-
securitization
Any application for information Rs.50/- plus Rs.10/- with
recorded/maintained in the service tax service tax
Register by any person including
online search of records.
Any application for condonation Not exceeding 10 Not exceeding 10
of delay up to 30 days times of times of
the basic fee, as the basic fee, as
applicable. applicable.
 RECOVERY
RECOVERY Policy on sale/transfer of financial Policy for sale of financial assets (NPAs) to
DIVISION
assets to Securitization Companies Securitization/Reconstruction Companies
CIRCULAR
NO. 03/2016 (SCs) / Reconstruction Companies (SCs/RCs) was framed pursuant to RBI guidelines
(RCs) / Other Banks / FIs & NBFCs of April, 2003 and same was approved by the
(excluding RRBs) Including Board in its meeting held on 21.11.2003 and the
Portfolio Sale Policy for sale of financial assets (NPAs) to other
Banks/FIs/NBFCs etc.
(excluding RRBs) was approved by the Board in its
meeting held on 06.10.2006.
Subsequently, the bank guidelines were modified
from time to time and the existing Policy for the
year 2015-16 was approved by the Board in its
meeting held on 24.09.2015 vide Resolution No.
41, containing guidelines on Portfolio Sale also.
While framing policy for the remaining period of
the current year and year 2016-2017, based on the
feedback received from field and experience gained
in implementation of Policy, few amendments were
proposed as per details given in the Annexure-
Amendment.
Revised Policy after incorporation of the proposed
amendments has been approved by the Board in its
meeting held on 01.02.2016 vide Resolution
Number 6. The revised Policy will be applicable
for the remaining period of 2015-2016 and 2016-
2017.
RECOVERY Monitoring & Review of NPA The powers vested at different levels for
DIVISION
accounts at FGMOs monitoring and review of NPA accounts have been
CIRCULAR
NO. 04/2016 stipulated in Recovery Division Circular no.
17/2012 dated 31.05.2012 on “Ways & Strategies
to improve Management of NPAs”.
There had been no revision in the powers
mentioned in the above circular for last four years,
however with FGMOs coming into existence, it
was being felt that some powers must be assigned
to the FGMs to have more focused approach for
 resolution of mid cap segment NPAs.
The matter was placed to the Board, which in its
meeting held on 01.02.2016 vide Resolution No. 44
approved that:
“FGMOs will be monitoring and reviewing the
NPA accounts with balance outstanding of above
Rs. 10 lacs, up to Rs. 50 lacs.”
RECOVERY Policy on Compromise/Negotiated Based on the suggestions received from the field
DIVISION Settlement/Write Off/Waiver of
made by the FGMs and Circle Heads and by virtue
CIRCULAR Legal Action/Appeal etc.
NO. 05/2016 of experience gained in implementing the Policy in
the past, certain changes/modifications in the
existing Policy were proposed, with details given in
the Annexure- Amendment. 3. The revised Policy
containing all the amendments was approved by the
Board in its meeting held on 01.02.2016 vide
Resolution no. 44. Revised Policy, applicable for
the remaining period of 2015-16 and 2016-17 is
annexed and all the field officials are advised to
ensure meticulous compliance of the guidelines
stipulated in the revised policy.
POLICY ON COLLECTION OF The “Code of Bank’s Commitment to Customers”
RECOVERY
DUES & REPOSSESSION OF is a voluntary code setting minimum standards of
DIVISION
CIRCULAR SECURITY banking practices for banks to follow when they
NO. 06/2016
deal with individual customers. Based on the Indian
Banks‟ Association‟s (IBA) Model Policy on the
captioned subject, our Bank resolved to adopt the
“Code” and the Board in its meeting held on
29.03.2007 had approved the „Policy on Collection
of Dues and Repossession of Security‟, which was
circularized to all the branches and placed on the
Bank‟s web site too. For the year 2016-17, Bank‟s
Policy was approved by the Board in its meeting
held on 01.02.2016 vide Resolution No. 10. There
are no amendments in the existing Policy.
RECOVERY Policy On Engagement of Presently, there had been no Bank’s Policy on
DIVISION Detective Agencies
engagement of Detective Agencies but keeping in
CIRCULAR
NO. 07/2016 view the rising demand from the field, for
utilization of their services, the Policy was framed
 for the first time and placed to the Board in its
meeting held on 01.02.2016 and was approved vide
resolution no. 46.
The Policy, defining objectives, role of the
detective agencies, fees payable etc. and is
annexed. The Policy being introduced for the first
time will remain valid during remaining part of the
current financial year and 2016-2017.
RECOVERY POLICY ON ENGAGEMENT
DIVISION OF SUPPORTING AGENCIES The Policy for engagement of Supporting
CIRCULAR UNDER SARFAESI ACT 2002
Agencies, for the year 2015-16 was approved by
NO. 08/2016
the Board in its meeting held on 30.03.2015 vide
Resolution No. 7.
Although there are no amendments in the Policy,
based on the feedback from the field few
clarifications have been provided in the Circular
with regard to payment of fees to the Supporting
Agencies and Service Tax in terms of Finance
Division guidelines (Refer to Notes given in the
Annexure-II of this Circular). For payment of
Service Tax, necessary clarification has also been
added in the Agreement.
The Policy for the remaining part of the current
year and 2016-17 after incorporating the
operational clarifications, was approved by the
Board in its meeting held on 01.02.2016.

RECOVERY POLICY ON ENGAGEMENT The extant Policy for the year 2015-16 was placed
DIVISION OF RECOVERY AGENCIES
before the Board in its meeting held on 30.03.2015
CIRCULAR
NO. 09/2016 and was approved vide Resolution No.9.
Although there are no amendments in the Policy,
based on the feedback from the field few
clarifications have been provided in the Circular
with regard to payment of fees to the Recovery
Agencies and Service Tax in terms of Finance
Division guidelines (Refer to Notes given in the
Annexure-II of this Circular). For payment of
Service Tax, necessary clarification has also been
 added in the Agreement.
The Policy for the remaining part of the current
year and 2016-17 after incorporating the
operational clarifications (shaded yellow for
convenience), was approved by the Board in its
meeting held on 01.02.2016,
RECOVERY SEIZURE AND SALE OF It has been observed that a sizeable amount of
DIVISION VEHICLES (INCLUDING
NPAs under the segment of below Rs.10 lac is
CIRCULAR TRACTORS) OF DEFAULTER
NO. 10/2016 BORROWERS locked up in vehicle loans particularly Tractor
advances. Besides, a large number of vehicle /
tractor loans are running irregular and are likely to
slip to NPAs, if immediate corrective action is not
taken.
In cases of deliberate default, at times effective
recovery measures need to be taken so as to enforce
our security interests including seizure of tractors,
cars, trucks and other vehicles, taking physical
possession and realizing its value by sale for credit
to the borrower’s loan account as per the covenants
of the contract / provisions of law.
Based on the feedback received from the field, fee
structure for the Seizure & Disposal Agents has
been upwardly revised, so that they evince interest
in the task assigned by the Bank, for resolution of
NPAs through seizure & sale of vehicles.
The Policy with the amendments in the fee
structure, for the year 2016-17 was reviewed and
approved by the Board in its meeting held on
01.02.2016 vide Resolution No.7.

RECOVERY Corrigendum to OTS Policy Powers in respect of Associate/Allied concerns:

DIVISION Circular no. 5/2016 dated
34.2.1 For the purpose of exercising above powers
CIRCULAR 12.02.2016
NO. 12/2016 for approval of sacrifice, as per guidelines
contained in the latest L & A Circulars (latest being
85/2014 dated 10.07.14) Associate/Allied concerns
and connected accounts shall be considered as one
borrower/debtor for the purposes of exercising
above powers for approval of sacrifice by the
 officers upto the AGM level (other than Circle
Heads). However, Credit Approval Committees
(previously Credit Appraisal Committees) headed
by Circle Head and above are empowered to
approve sacrifice to allied/associate
concerns/connected accounts taken together upto 2
times the powers vested to them as above.
RECOVERY EMPANELMENT OF VALUERS- Consolidated guidelines pertaining to empanelment
DIVISION
CONSOLIDATED GUIDELINES & of valuers were circulated vide Recovery Division
CIRCULAR
No. 11/2016 PANEL OF VALUERS-2016-2017 Circular no. 10/2014 dated 28.02.14 and further
amendments were circulated vide Recovery
Division Circular no.10/2015 dated 08.04.15 along-
with the list of valuers approved by the Board for
the year 2015-2016.

MISC.
L & KMC Scheme for providing Incentive to L&KMC Circular No 03/2014 dated 19.08.2014
(TRAINING
Staff Members for acquiring some was issued by our division, for providing Incentive
DEPTT.)
CIRCULAR Specialized to Staff Members for acquiring some Specialized
NO. 02/2016
Qualifications / qualifying some Qualifications / qualifying some Specific Courses.
Specific Courses
Online certificate course on ‘Cyber Laws’ (S. No.
20) (Cir. No.03/2014 dt 19/08/2014)
It has now been decided to revise the cash
Incentive payable on passing of this course.
Existing Guidelines Revised Guidelines
The certificate course The certificate course of
of Indian Law Institute Indian Law Institute
(www.ili.ac.in) relates (www.ili.ac.in) relates to
to cyber world and cyber world and
cyber laws, regulatory cyber laws, regulatory
frame work, cyber frame work, cyber
crimes and related crimes and related
concepts and regulation concepts and regulation
of cyber crimes. The of
course has been cyber crimes. The course
approved for ‘Specific has been approved
up-gradation’ of for ‘Specific up-
skills and incentive i.e. gradation’ of skills and
Fee reimbursement incentive i.e. Fee
 + cash incentive of Rs. reimbursement + cash
20000/- payable on incentive of Rs. 5000/-
acquiring of this course payable on passing of
is payable to the this course is payable to
the eligible official.
eligible official.

CCC/Cir. CHEQUE COLLECTION POLICY The Cheque Collection Policy of the Bank was last
No.03/2016 reviewed on 27.09.2014. As per Regulator’s
direction, the Policy is to be reviewed on an annual
basis and necessary changes are made wherever
required.
Board in its meeting held on 1.02.2016 has
approved the revised Cheque Collection Policy.
The reviewed Policy is annexed.
The Policy for General Management of Branches
CCC/Cir. POLICY FOR GENERAL was last reviewed by the Board on 23.12.2014. As
No.04 /2016 MANAGEMENT OF BRANCHES per Regulator’s direction, the Policy is to be
reviewed on an annual basis and necessary changes
are made wherever required.
Board in its meeting held on 1.2.2016 has approved
the revised Policy for General Management of
Branches. The reviewed Policy is annexed.

Circular THE COMPANIES ACT, 1956 — In a recent judgment, the High Court of Hyderabad
Letter
On default of the borrower the lender in Mauritius Commercial Bank Ltd. versus Sujana
No.2/LAW/20
16 is entitled not only to file a civil suit Universal Industries Limited MANU/AP/0387
for recovery of the debt /2015 held that the lender is entitled not only to file
due, but may also invoke the a civil suit for recovery of the debt due, but may
jurisdiction of the Company Court also invoke the jurisdiction of the Company Court
for winding up of the Guarantor for winding up of Guarantor Company.
Company under section 433(e) read Being aggrieved by the judgment of High Court of
with section 434(1) of the Act. Hyderabad M/s Sujana Universal Industries Ltd.
filed Special Leave to Appeal (C) No(s).23713-
23714/2015 before the Hon’ble Supreme Court
which were dismissed by the Court vide its order
dated 01/09/2015 and the Apex Court also
dismissed the Review Petition (C) No. 3088 of
2015 in SLP (C) No. 23714 of 2015 vide its order
dt. 14.10.2015. As such, the verdict of Hyderabad
High Court has attained finality.
CUSTOMER Chief Customer Service Officer In view of the guidelines conveyed by RBI, Clause
CARE (Internal Ombudsman) 2.1 of our CCSO Scheme has been replaced with
CENTRE Scheme of the Bank the following:
Circular “Clause 2.1: Bank will internally escalate all cases
No.05/2016
to the CCSO (Internal Ombudsman) for final
decision where either the complaint is rejected or
only partial relief is provided to the complainant.”
The Revised CCSO Scheme is annexed and has
also been updated on our Bank’s website.
In view of above, all Offices are advised to escalate
all cases to their higher office where
either the complaint is rejected or only partial relief
is provided to the complainant, alleging
deficiency in banking including internet banking or
other services on any of the grounds specified in
Annexure to CCSO Scheme, for their
consideration. Complaints rejected at FGM/GM
HO level are to be forwarded by GM (CCC), HO,
the Principal Nodal Officer of the Bank for
Complaints, to CCSO (Internal Ombudsman) for
final decision.”
MBD Clarification on handling As a part of continuing endeavour to streamline
CIRCULAR syndicate/sub-syndicate ASBA the process of public issue of equity share and
No. 06 forms. Convertible debenture, SEBI issued guidelines
making ASBA process mandatory for all public
issues opening on or after Jan. 01, 2016.
Accordingly, we re-circulated salient features of
ASBA module vide MBD circular No. 43/2015
dated 28-12-2015.
Besides above, we also issued circular MBD
circular No. 44 dt.28.12.2015 containing gist of
guidelines as well as revised timeline for handling
for ASBA forms received from syndicate/sub
syndicate members. Now we have received
clarification from SEBI on streamlining the process
of public issue of equity shares and Convertible as
per circular.
HRDD PNB Navodaya: Employee On- For synergizing Bank’s Business Vision with
CIRCULAR
boarding and Mentoring Mechanism Human Capital Goals, a number of key challenges
NO. 740
have been identified and HR strategies are being
formulated for addressing the same. One such
challenge is recruitment of highly aspiring,
energetic, tech-savvy but inexperienced employees.
 For addressing this important issue, it has been felt
that Onboarding and Mentoring is an effective
mechanism to provide Orientation, Nurturing,
Better Understanding of Internal Culture and
Employee Engagement for the newly recruited
employees.
We are pleased to launch the Onboarding &
Mentoring Program titled “PNB Navodaya”.
PNB Navodaya will facilitate the new employee to
acquire the necessary knowledge, skills and
behaviour to become effective organizational
member. The program will also help to channelize
these employees’ energies towards Bank’s
development, with a view to transform them into
brand ambassadors for the business growth and
organizational goal.
Mentoring Process of ‘PNB Navodaya’ will
initially include newly recruited Management
Trainees and Technical Officers; the program shall
be rolled over for all PNB parivar members later in
phased manner.
CIRCULAR INVOCATION OF PERSONAL AS When an account becomes NPA, though
NO.2/LAW/2
WELL AS CORPORATE guarantees given by individuals and corporate
016
GUARANTEES IN CASE OF guarantors are invoked, usually there is delay in
DEFAULT BY THE BORROWERS filing of recovery suit and getting their assets
attached. Any delay in this regard facilitates the
guarantors to dispose of their assets.
Since the guarantors are jointly, severally and co-
extensively liable for the dues of the borrowers,
even without proceeding against the borrowers,
bank can legally proceed against the guarantors and
their assets. In the case of corporate guarantors,
bank can even consider filing of winding up
petition against them.
While filing recovery suits/ applications before
Courts/DRTs, it be ensured that Interim
Applications (IAs) for Impounding Passport of the
borrowers (individuals, Directors of Companies,
 Partners as the case may be), guarantors as well as
of the Directors of corporate guarantors, besides
IAs for obtaining Injunction Orders against sale of
assets by the liable parties, Attachment of their
movable and immovable assets etc. are necessarily
filed and the advocates be advised to argue on such
Interim Applications so as to get necessary orders
from the court/DRT.

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