Report on Hdfc Bank

1 PROJECT FINAL REPORT ON edgeING BY JIGAR SONI AT Summer Internship forcing out 2 PROJECT TITLE A project treat on COMPANY GUIDE FACULTY GUIDE ================ ============== Mr. Manish Panchal Prof. Pragna Kaul Branch passenger car IBMR Ahmedabad Kapadwanj. Prep bed by Jigar J Soni Roll no. 5 , Div A IBMR _Ahmedabad Year 2008/09 3 Ac sleep to beat outherledgements If delivery atomic number 18 considered to be signs of gratitude then let these words Convey the very same My sincere gratitude to HDFC BANK for roviding me with an opportunity to work with BANK and giving necessary directions on doing this project to the best of my abilities. I am highly indebted to Mr. Manish Panchal. , Branch Manager and tele recallr project guide, who has provided me with the necessary information and also for the support extended out to me in the completion of this report and his worthful suggestion and comments on bringing out this report in the best way possible. I also thank Prof. Pragn a Kaul, IBMR_Ahmedabad, who has sincerely supported me with the expensive insights into the completion of this project.I am grateful to all faculty members of IBMR_Ahmedabad and my 4 friends who chip in helped me in the successful completion of this project. 5 CONTENTS Sr. zero(prenominal) Subject Covered Page No. 1 imprecateing Structure in India 6-7 2 Indian vernacularing Industries 8-9 3 Upcoming conflicting lodge in India 10 4 HDFC BANK 11-12 5 Company Pro blame 13-15 6 technology single-valued functiond 16-19 7 Product and guest segments 20-23 8 Business Strategy 24-25 9 Inside Hdfc Bank 26-31 10 Rupee Earned Rupee Spent 32-33 11 Recent Development 34-41 12 SWOT Analysis 42-48 13 Project on Plastic Money 49-55 6 BANKING STRUCTURE IN INDIA schedule Banks in India (A) Scheduled Commercial BanksPublic atomic number 18na Banks Private celestial sphere Banks Foreign Banks in India Regional Rural Bank (28) (27) (29) (102) Nationalized Bank Other Public Sector Banks (IDB I) SBI and its Associates Old Private Banks New Private Banks (B) Scheduled Cooperative Banks Scheduled Urban Cooperative Banks (55) Scheduled State Cooperative Banks (31) 7 Here we more concerned about mystical arena swears and competition among them. Today, there are 27 private welkin margins in the banking sector 19 old private sector banks and 8 new private sector banks. These new banks use up brought in state-of-the-art technology and Aggressively marketed their products.The Public sector banks are Facing a stiff competition from the new private sector banks. The banks which have been put upup in the 1990s under the guidelines of the Narasimham Committee are referred to as NEW PRIVATE SECTOR BANKS. New Private Sector Banks Superior mo clamsary Services Designed Innovative Products Tapped new markets Accessed Low cost NRI funds Greater efficiency 8 INDIAN BANKING INDUSTRIES The Indian banking market is growing at an astonishing rate, with Assets expected to reach US$1 t rillion by 2010. An expanding economy, middle screen out, and technological innovations are all ontributing to this growth. The countrys middle class accounts for over 320 million people. In cor proportion with the growth of the economy, rising income levels, increased standard of living, and affordability of banking products are promising factors for continued expansion. 9 The Indian banking Industry is in the middle of an IT revolution, Focusing on the expansion of sell and rural banking. Players are becoming increasingly node centric in their approach, which has takeed in innovative methods of fling new banking products and run. Banks are now realizing the mportance of being a big worker and are beginning to focus their attention on mergers and acquisitions to take advantage of economies of casing and/or comply with Basel II regulation. Indian banking industry assets are expected to reach US$1 trillion by 2010 and are poised to come a greater infusion of foreign majusc ule, says Prathima Rajan, analyst in Celents banking group and author of the report. The banking industry should focus on having a small number of freehanded players that drive out compete globally rather than having a bad number of fragmented players. UPCOMING FOREIGN BANKS IN INDIA By 2009 few more call is exit to be added in the list of foreign banks in India. This is as an aftermath of the sudden interest shown 10 by Reserve Bank of India pavage roadmap for foreign banks in India greater freedom in India. Among them is the worlds best private bank by EuroMoney magazine, Switzerlands UBS. The following are the list of foreign banks going to set up business in India - Royal Bank of Scotland Switzerlands UBS US-based GE cap Credit Suisse separate Industrial and Commercial Bank of China WE UNDERSTAND YOUR publicThe Housing Development Finance Corporation bound (HDFC) was amongst the first to receive an in principle approval from the 11 Reserve Bank of India (RBI) to se t up a bank in the private sector, as part of the RBIs liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the rear of HDFC Bank Limited, with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995. HDFC is Indias premier living accommodations finance company and enjoys an impeccable track record in India as well as in internationalist markets.Since its inception in 1977, the Corporation has maintained a pursuant(predicate) and effectual growth in its operations to remain the market leader in mortgages. Its outstanding loan portfolio covers well over a million abode units. HDFC has developed significant expertise in retail mortgage loans to different market segments and also has a large corporate client base for its housing related credit facilities. With its experience in the financial markets, a unbendable market reputation, large shareholder base and unique consum er franchise, HDFC was ideally positioned to promote a bank in the Indian nvironment. HDFC Bank began operations in 1995 with a straightforward charge to be a 12 World Class Indian Bank. We realized that only a single minded focus on product musical note and service excellence would help us get there. Today, we are proud to say that we are well on our way towards that goal. COMPANY PROFILE STRONG NATIONAL NETWORK 13 HDFC BANK As of borderland 31, 2008, the Banks distribution network was at 761 Branches and 1977 ATMs in 327 cities as against 684 branches demonstrate 2006 March 2007 March 2008 Citied 228 316 327 Branches 535 684 761 ATMs 1323 1605 1977 14 nd 1,605 ATMs in 320 cities as of March 31, 2007. Against the regulatory approvals for new branches in hand, the Bank expects to further expand the branch network by around 150 branches by June 30, 2008. During the year, the Bank stepped up retail customer acquisition with deposit accounts increasing from 6. 2 million to 8. 7 million and total pesters issued (debit and credit cards) increasing from 7 million to 9. 2 million. Whilst credit growth in the banking system slowed down to about 22% for the year ended 2007-08, the Banks net advances grew by 35. 1% with retail advances growing by 38. % and sell advances growing by 30%, implying a higher market share in both segments. The transactional banking business also registered healthy growth With cash management volumes increased by around 80% and trade operate volumes by around 40% over the previous year. Portfolio prize as of March 31, 2008 remained healthy with gross nonperforming assets at 1. 3% and net non-performing assets at 15 0. 4% of total customer assets. The Banks provisioning policies for ad hoc loan loss provisions remained higher than regulatory requirements. TECHNOLOGY USED IN HDFC BANKIn the era of globalization each and every sector faced the stiff competition from their rivals. And world also converted into the flat from the globe. After the policy of liberalization and RBI initiatives to take the step for the private sector banks, more and more changes 16 are taking the part into it. And there are create competition between the private sector banks and public sector bank. Private sector banks are today used the latest technology for the different transaction of day to day banking life. As we know that Information engineering plays the vital role in the each and every ndustries and gives the optimum return from the limited resources. Banks are service industries and today IT gives the innovative Technology application to Banking industries. HDFC BANK is the leader in the industries and today IT and HDFC BANK together combined they reached the sky. New technology changed the mind of the customers and changed the queue concept from the history banking transaction. Today there are different channels are available for the banking transactions. We can see that the how technology gives the best results in the below draw. There are drastically changes seen in the use of values banking, in a year 2001 (2%) and in the year 2008 ( 25%). These type of technology gives the freedom to retail customers. 17 Centralized Processing Units Derived Economies of cuticle Electronic Straight Through Processing Reduced Transaction Cost Data Warehousing , CRM Improve cost efficiency, Cross sell Innovative Technology Application Provide new or superior products HDFC BANK is the very consistent player in the New private sector banks. New private sector banks to withstand the competition from public sector banks came up with innovative products and superior service. 2001 18 Branches 43% ATM 40%Phone Banking 14% lucre 2% Mobile 1% 2005 Branches 17% ATM 45% Phone Banking 12% Internet 25% Mobile 1% ( % customer initiated Transaction by Channel ) 19 HDFC BANK PRODUCT AND CUSTOMER SEGMENTS PERSONAL BANKING add Product Deposit Product Investment & Insurance Auto Loan Loan Against Security Loan Against Property Pers onal loan Credit card 2-wheeler loan Commercial vehicles finance Home loans Retail business banking Tractor loan work Capital Finance Construction Equipment Finance wellness Care Finance Education Loan Gold Loan Saving a/c on-line(prenominal) a/c glacial deposit Demat a/c Safe DepositLockers Mutual Fund Bonds Knowledge Centre Insurance General and Health Insurance Equity and Derivatives Mudra Gold Bar 20 circulars Payment Services Access To Bank Credit banknote Debit Card postpaid Card - - Forex Services - - Product & Services Trade Services Forex service Branch Locater RBI Guidelines NetSafe Merchant Prepaid Refill Billpay Visa Billpay InstaPay DirectPay VisaMoney transfer eMonies Electronic Funds Transfer Online Payment of Direct Tax NetBanking OneView InstaAlert MobileBanking ATM Phone Banking Email Statements Branch Network 21 WHOLESALE BANKING incorporate Small and Medium Enterprises Financial Institutions and Trusts Funded Services Non Funded Services Value Added Servi ces Internet Banking Funded Services Non Funded Services Specialized Services Value added services Internet Banking BANKS Clearing Sub- Membership RTGS submembership Fund Transfer ATM Tie-ups Corporate Salary a/c Tax Collection Financial Institutions Mutual Funds threadbare Brokers Insurance Companies Commodities Business Trusts BUSINESS MIX 22 Total Deposits Gross Advances Net RevenueRetail Wholesale HDFC Bank is a consistent player in the private sector bank and have a well balanced product and business mix in the Indian as well as overseas markets. Customer segments (retail & wholesale) account for 84% of Net revenues ( FY 2008) Higher retail revenues partly offset by higher operating and credit cost. every bit well positioned to grow both segments. . 23 NRI SERVICES Accounts & Deposits Remittances Rupee Saving a/c Rupee Current a/c Rupee Fixed Deposits Foreign Currency Deposits Accounts for Returning Indians North America UK Europe South East Asia Middle East Africa OthersQuic k remit IndiaLink Cheque LockBox telegraphic/ Wire Transfer Funds Transfer Cheques/DDs/TCs Investment & Insurances Loans Mutual Funds Insurance Private Banking Portfolio Investment Scheme Home Loans Loans Against Securities Loans Against Deposits Gold Credit Card Payment Services Access To Bank NetSafe BillPay InstaPay DirectPay Visa Money Online Donation NetBanking OneView InstaAlert ATM PhoneBanking Email Statements Branch Network 24 BUSINESS STRETEGY HDFC BANK mission is to be a World Class Indian Bank, benchmarking themselves against international standards and best ractices in terms of product offerings, technology, service levels, encounter management and size up & compliance. The aim is to build sound customer franchises across distinct businesses so as to be a preferred provider of banking services for target retail and wholesale customer segments, and to achieve a healthy growth in profitability, consistent with the Banks risk appetite. Bank is committed to do this while ensuring the highest levels of ethical standards, lord integrity, corporate governance and regulatory compliance. Continue to develop new product and technology is the main business strategy f the bank. Maintain good relation with the customers is the main and prime objective of the bank. HDFC BANK business strategy emphasizes the following 25 Increase market share in Indias expanding banking and financial services industry by following a disciplined growth strategy focusing on select and not on quantity and delivering high quality customer service. Leverage our technology platform and open scaleable systems to deliver more products to more customers and to control operating costs. Maintain current high standards for asset quality through disciplined credit risk management. Develop innovative products and services that draw the targeted customers and address inefficiencies in the Indian financial sector. Continue to develop products and services that reduce banks cost of funds. Focus on high earnings growth with low volatility. 26 INSIDE HDFC BANK FIVE S , PART OF KAIZEN WORK PLACE TRANSFORMATION Focus on effective work bug out organization Believe in Small changes lead to large improvement Every successful organization have their own strategy to win the race in the competitive market. They use some technique and methodological analysis for smooth running of business.HDFC BANK also aquired the Japanese technique for smooth running of work and effective work place organization. Five S come apart of Kaizen is the technique which is used in the bank For easy and systematic work place and eliminating unnecessary things from the work place. BENEFIT OF FIVE S 27 It can be started immediately. Every one has to participate. Five S is an entirely people driven initiatives. Brings in concept of ownership. All wastage are made visible. FIVE S Means - S-1 SORT SEIRI S-2 SYSTEMATIZE SEITON S-3 SPIC-N-SPAN SEIRO S-4 STANDARDIZE SEIKETSU S-5 SUSTAIN SHITSUKE (1) SO RT -It focus on eliminating unnecessary items from the work place. It is excellent way to free up valuable floor space. It segregate items as per require and wanted. (2) SYSTEMATIZE - Systematize is focus on efficient and effective Storage method. Frequently Requir ed slight Frequently Requir ed Remove everything from workplace Junk Wanted but not Required Junk 28 That means it identify, organize and arrange retrieval. It more often than not focus on good labeling and identification practices. Objective - A place for everything and everything in its place. (3) SPIC- n SPAN - Spic-n-Span focuses on regular clearing and egotism nspection. It brings in the sense of ownership. (4) STANDERDIZE - It focus on simplification and standardization. It involve standard rules and policies. It establish checklist to facilitates autonomous maintenance of workplace. It assign responsibility for doing various jobs and decide on Five S frequency. (5) SUSTAIN- It focuses on defining a new status a nd standard of organized work place. Sustain means regular bringing up to maintain standards developed under S-4. It brings in self- discipline and commitment towards workplace organization. 29 LABELLING ON FILE FILE NUMBER SUBJECT FROM eon TO DATE OWNER BOX LABELFor Example 1 / 3 / A / 6 1 Work Station (1) 3 Drawer (3) A shelf (A) 6 File Number ( 6) 30 COLOUR CODING OF FILES DEPARTMENT Welcome Desk Personal Banker Teller Relationship Manager Branch Manager Demat Others In the HDFC BANK each department has their different wile coding apply on the different file. Due to this everyone aware about their particular color file which is coding on it and they save their valuable time. It is a part of Kaizen and also included in the system of the Five S. Logic behind it that , the color coding are always differentiate the things from the similar one. 31 HUMAN RESOURCESThe Banks staffing needs continued to increase during the year particularly in the retail banking businesses in line with the business growth. Total number of employees increased from 14878 as of March31,2006 to 21477 as of March 31, 2007. The Bank continues to focus on training its employees on a continuing basis, both on the job and through training programs conducted by internal and immaterial faculty. The Bank has consistently believed that broader employee ownership of its shares has a constructive impact on its performance and employee motivation. The Banks employee stock option scheme so far covers round 9000 employees. 32 rupee EARNED RUPEE SPENT It is more important for every organization to know about from where and where to played out money. And balanced between these two things rupee realise and rupee spent are required for smooth running of business and financial soundness. This type of watch can control and eliminate the unnecessary spending of business. In this diagram it include both things from where Bank earned Rupee and where to spent. 33 HDFC BANK earned from the Interest from Advances 51. 14 % , Interest from Investment 27. 12 %, bank earned commission exchange and brokerage of 15. 25 %.These are the major earning sources of the bank. Bank also earned from the Forex and Derivatives and some other Interest Income. Bank spent 39. 75 % on Interest Expense, 30. 27 % on Operating Expense and 14. 58 % on Provision. Bank also spent Dividend and Tax on dividend, Loss on Investment , Tax. As we discuss above that balancing is must between these two for every organization especially in the era of globalization where there are stiff competition among various market players. RECENT DEVELOPMENT 34 The Reserve Bank of India has approved the scheme of amalgamation of Centurion Bank of Punjab Ltd. ith HDFC Bank Ltd. with effect from May 23, 2008. All the branches of Centurion Bank of Punjab will function as branches of HDFC Bank with effect from May 23, 2008. With RBIs approval, all requisite statutory and regulatory approvals for the merger have been obtained. 35 The combined entity would have a nation unspecific network of 1167 branches a strong deposit base of around Rs. 1,22,000 crores and net advances of around Rs. 89,000 crores. The balance sheet size of the combined entity would be over Rs. 1,63,000 crores. Merger with Centurion Bank of Punjab LimitedOn March 27, 2008, the shareholders of the Bank accorded their consent to a scheme of amalgamation of Centurion Bank of Punjab Limited with HDFC Bank Limited. The shareholders of the Bank approved the issuance of one equity share of Rs. 10/- each of HDFC Bank Limited for every 29 equity shares of Re. 1/- each held in Centurion Bank of Punjab Limited. This is subject to receipt of Approvals from the Reserve Bank of India, stock exchanges and Other requisite statutory and regulatory authorities. The shareholders Also accorded their consent to issue equity shares and/or warrants onvertible into equity shares at the rate of Rs. 1,530. 13 each to HDFC Limited and/or other protagonist group co mpanies on preferential basis, subject to final regulatory approvals in this regard. The Shareholders of the Bank have also approved an increase in the authorized capital from Rs. 450 crores to Rs. 550 crores. 36 Promoted in 1995 by Housing Development Finance Corporation (HDFC), Indias leash housing finance company, HDFC Bank is one of Indias premier banks providing a wide range of financial products and services to its over 11 million customers across hundreds ofIndian cities using multiple distribution channels including a pan-India network of branches, ATMs, phone banking, net banking and mobile banking. Within a relatively short span of time, the bank has emerged as a leading player in retail banking, wholesale banking, and treasury operations, its three principal business segments. The banks competitive strength clearly lies in the use of technology and the ability to deliver world-class service with speedy response time. Over the last 13 years, the bank has successfully gain ed market share in its target customer franchises while maintaining healthy rofitability and asset quality. 37 As on March 31, 2008, the Bank had a network of 761 branches and 1,977 ATMs in 327 cities. For the year ended March 31, 2008, the Bank reported a net profit of INR 15. 90 billion (Rs. 1590. 2crore), up 39. 3%, over the corresponding year ended March 31, 2007. As of March 31, 2008 total deposits were INR 1007. 69 billion, (Rs. 100,769 crore) up 47. 5% over the corresponding year ended March 31, 2007. Total balance sheet size too grew by 46. 0% to INR 1,331. 77 billion (133177 crore). leading Indian and internationalPublications have recognized the bank for its performance and quality. Centurion Bank of Punjab is one of the leading new generation private sector banks in India. The bank serves individual consumers, small and medium businesses and large corporations with a full range of financial products and services for investing, lending and 38 advice on financial planning. The bank offers its customers an aline of wealth management products such as mutual funds, life and general insurance and has established a leadership position. The bank is also a strong player in foreign exchange services, ersonal loans, mortgages and agricultural loans. Additionally the bank offers a full suite of NRI banking products to Overseas Indians. On 29th August 2007, Centurion Bank of Punjab merged with Lord Krishna Bank (LKB), post obtaining all requisite statutory and regulatory approvals. This merger has further strengthened the geographical reach of the Bank in major towns and cities across the country, especially in the State of Kerala, in addition to its existing dominance in the northern part of the country. Centurion Bank of Punjab now operates on a strong nationwide ranchise of 404 branches and 452 ATMs in 190 locations across the country, supported by employee base of over 7,500 employees. In addition to being listed on the major Indian stock exchanges, the Ba nks shares are also listed on the Luxembourg Stock 39 Exchange. ACHIEVEMENT IN 2007 Business Today- Monitor Group survey One of Indias Most Innovative Companies Financial Express- Ernst & Young Award best Bank Award in the Private Sector category 40 Global HR Excellence Awards Asia Pacific HRM Congress Employer Brand of the Year 2007 -2008Award First Runner up, & many more Business Today Best Bank Award Dun & Bradstreet American Express Corporate Best Bank Award 2007 Corporate Best Bank Award The Bombay Stock Exchange and Nasscom Foundations Business for friendly Responsibility Awards 2007 Best Corporate Social Responsibility Practice Award Outlook Money & NDTV Profit Best Bank Award in the Private sector category. The Asian Banker Excellence in Retail Financial Services Awards Best Retail Bank in India Asian Banker HDFC BANK Managing Director Aditya Puri wins the Leadership consummation Award for India 41 SWOT ANALYSISSTRENGTH Right strategy for the right products. Superior customer service vs. competitors. WEAKNESSES Some gaps in range for current sectors. Customer service staff need training. 42 Great Brand Image Products have required accreditations. High degree of customer satisfaction. Good place to work Lower response time with efficient and effective service. Dedicated workforce aiming at making a long-term career in the field. Processes and systems, etc oversight cover insufficient. Sectoral growth is constrained by low unemployment levels and competition for staff 3 Opportunities Profit margins will be good. Could extend to overseas broadly. New specialist applications. Could seek better customer deals. Fast-track career development opportunities on an industry-wide basis. An applied research centre to create opportunities for developing techniques to provide added-value services. Threats Legislation could impact. Great risk involved precise high competition prevailing in the industry. Vulnerable to reactive attack by major competitors Lac k of infrastructure in rural areas could constrain investment. High volume/low cost market is intensely ompetitive. 44 COMPETITIVE SWOT ANALYSIS WITH ICICI BANK STRENGTHS WEAKNESSES O P P O R T U N I T I E S S O Strategies Strength Large Capital base. fortune Market Expansion. Strategy Deep Penetration into Rural Market. W O Strategies Weakness Workforce Responsiveness. Opportunity Outsourcing of Non Core Business. Strategy Outsource Customer Care & other E-Helps. T H R E A T S S T Strategies Strength Low operating costs Threat Increased Competition from others Pvt. Banks. Strategy Steps to Ensure Loyalty by old Customers. W T Strategies Weakness Not Equal to internationalist Standards.Threat Entry of many Foreign Banks. Strategy Consider additional benefits 45 Detailed Analysis i. Strength Opportunity Analysis. Strength It is well know that ICICI Bank has the largest Authorised Capital Base in the Banking System in India i. e. having a total capacity to raise Rs. 19,000,000 ,000 (Non Premium Value). Opportunity Seeing the impart financial & economic development of Indian Economy and also the tremendous growth of the Indian Companies including the acquisition spree followed by them, it clearly states the expanding market for finance requirements nd also the growth in surplus disposal income of Indian citizens has given a great rise in savings deposits from the above fleck it is clear that there is a huge market expansion possible in banking sector in India. Strategy From the analysis of Strength & Opportunity the simple and 46 straight possible strategy for ICICI Bank could be to penetrate into the rural sector of India for expanding its market share as well as leading all other Pvt. Banks from a great gap. ii. Strength Threat Analysis. Strength ICICI Bank is not only known for large capital but also for having a ow operations cost though having huge number of branches and services provided. Threat After showing a significant growth overall, Indi a is able to attract many international financial & banking institutes, which are known for their state of art working and keeping low operation costs. Strategy To ensure that ICICI Bank keeps going on with low operation cost & have continuous business it should simply promote itself well & provide quality service so as to ensure customer loyalty, therefore guaranteeing continuous business. 47 iii. Weakness Opportunity Analysis. WeaknessIt is well known that workforce responsiveness in banking sector is Very low in Indian banking sector, though ICICI Bank has better responsible staff but it still lacks behind its counterparts like HSBC, HDFC BANK, CITI BANK, YES BANK etc. Opportunity In the present world, India is preferred one of the best places for out sourcing of business process works and many more. Strategy As international companies are reaping huge benefits after out- sourcing there customer care & BPOs, this same strategy should be implemented by ICICI Bank so as to have p roper customer ervice without hindering customer expectations. 48 iv. Weakness Threat Analysis. Weakness Though having a international presence, ICICI Bank has not been able to keep up the international standards in providing customer service as well as banking works. Threat In recent times, India has witnessed entry of many international banks like CITI Bank, YES Bank etc which posses an external entrant threat to ICICI Bank as this Banks are known for their art of working and maintain high standards of customer service. Strategy After having new entrants threat, ICICI Bank should come up withMore additional benefits to its customer or may be even reduce some fees for any additional works of customers. 49 PROJECT ON PLASTIC MONEY PLASTIC MONEY PLASTIC MONEY I give the project on Plastic Money to bank. The objective behind this project is to increase the rich customers list in a bank. Plastic Money title itself says the use of Credit Card and Debit Card in day to day transaction o f the business. I prepared the presentation on it and 50 submitted to bank and Bank already started work on this project. idea behind this project is to sale the bulk product. Target customerOf this project are two parties one is Wholesaler and second is Retailer. Due to this idea bank also sell their swipe machine to wholesaler and create brand image in the market. The idea behind this, bank give the credit card swipe machine to wholesalers and retailers use the credit card of the bank. Bank gives the 50 days credit to their credit card holders. So here retailers can get benefit of long credit period and on the other side wholesalers can get the benefit of same day payment. As a result bank got the wide list of customers of wholesalers and retailers.