RATIONALES

Part I

1. Bank provides Product information to prospective customers through its

website.

¾ As per Fair lending practices code adopted by the bank as per

RBI directives.
¾ It also facilitates our marketing efforts
¾ Product information helps a customer to pick up the products
of their choice

2. Bank is selling more & more State Bank Cash Plus to customers

¾ State Bank Cash Plus is an ATM-cum-Debit Card which can

also be operated at different M.E.
¾ It facilitates optimum cash conveyance anytime anywhere
banking.
¾ Tension free shopping through Networked ATMs & different
P.O.S. of ME
¾ Transaction cost will be reduced & remain competitive at par
with Techno Savvy branches.
¾ It also facilitates our investment in technology into business
proposition

3. Bank offers free accidental Insurance cover to HL, Car Loan &
Tractor Loan borrowers

¾ This is a value addition in our marketing efforts our products

facilitates to remain competitive.
¾ Provide relief to aggrieved family in case of death of the
borrower due to accident.
¾ Repayment of Bank’s loan is assured, no slippage to NPA

4. We send weekly abstract every Friday.

¾ In order to arrive at correct Demand and Time Liabilities at the

apex level
¾ To maintain statutory CRR & SLR with RBI as per Sec.42 of
RBI Act & 24 of BR Act 1949
¾ Non submission of report may invoke penalty by RBI

5. Input forms relating to limit change are stitched along with vouchers

¾ Preventive measure to safeguard the Bank's interest.

¾ It facilitates checking of day book and records relating to Non
financial transactions.
¾ Ensures that Non financial transactions has been put through
the System duly authorized by an officials.
6. Credit Information System has been introduced.

¾ This has been introduced with a view to maintaining a detail &

meaningful database of all the advances of the bank/branch for
monitoring & decision making
¾ Moreover it facilitates IRAC & Provisioning thereof
¾ It has brought uniformity/transparency right from the operating
level to Controllers, External Users
¾ It also helps in cleaning up data to be adopted for CBS
purpose.

7. All computer system should be supported by UPS System?

¾ This is one of preventive measures to safeguard the computer

system
¾ It ensures clean power supply for a limited period in case of
power failure
¾ It guards data loss, corruption of data file etc. & ensure smooth
functioning of the Branch
¾ Thereby facilitate customer service & Improve public image of
the Bank.

8. ALCO reports are sent fortnight, why?

¾ ALCO returns/reports contain maturity/remaining maturity

patter of deposits & advances
¾ It facilitates in maintaining appropriate Assets/Liability level,
Product Mix to avoid undesirable mismatch & optimization of
Profits
¾ Facilitates detailed Policy formulations, review &
implementation
¾ Decision making in Critical area.

9. Preventive Vigilance Committee meeting is held at Branches

regularly.

¾ In order to create awareness among the staffs towards the

measure of Preventive Vigilance
¾ It facilitates identification of potential physical/logical risks
associated with the computer system & to take remedial steps
¾ It helps uninterrupted/smooth functioning & Improved
Customer Service

10. BM’s monthly certificate is sent to Controllers.

¾ BM’s monthly certificate is a management control tool which

facilitates progressive and systematic monitoring of Branch
functioning
¾ It helps the controller expeditious remedial measure to improve
the Branch functioning/administration further
¾ It also reflects transparency in supervision & control.
11. BM scrutinizes staff accounts on regular basis. Why?

¾ This is a Preventive measure

¾ Adopted to ensure that no unauthorized transactions of in
proportionate nature are being put through staff account.
¾ Operation in the account as per means & living style of
employee
¾ It helps detection of frauds, forgery through staff account.

12. Hurdle rate revised from SB5 to SB4?

¾ This has been done as per the Bank’s policy of maintaining

quality of assets & reducing incidence of Naps
¾ Moreover it also helps in monitoring of health of advances &
control over slippage
¾ Improved quality of assets reduces capital charge & hence
lower PLR which provides edge over competitors.

13. While giving advance to a company, MA & AA are being scrutinized

minutely.

¾ MA/AA gives the name, address, signature, authorized, Paid-

up Capital of Company which facilitates identification of
directors, financial authenticity and the purpose/objective of
company thus prevents impersonation, frauds, forgeries.

14. Different Colour A/c opening form has been introduced for
Metro/Urban/Semi Urban/Rural branches.

¾ In order to make it convenient in identification of A/c Opening

Form at operational level
¾ It also facilitates supply/handling from our stationery deptt.
¾ Moreover different colour symbolizes different centre of
operations.

15. Job rotation is done regularly.

¾ This is a preventive measure to avoid frauds, forgery

¾ It provides the opportunity for job-enrichment to every
operating staff which is one of the ingredient for excellent
customer service
¾ Enriched employee can answer every query of customers as
required by Goiporia Committee recommendation.

16. Bank participates in Lok Adalats Why?

¾ NPA are doubled drainage on Bank’s Profitability

¾ Lok Adalat is no cost & expeditious on the spot method of
recovering NPA
¾ It saves time, cost of the Bank & facilitates recycling of funds

17. Comments Sheet is attached to ‘P’ Report.

¾ ‘P’ Report is a progressive data base monthly report from Branch to

Controller
 ¾ Comments make the communication purposeful & review to be
meaningful
¾ It also helps in ascertaining the areas which requires sharp attention
& corrective action.

18. Why Govt. sponsored Education Loan/Student Loan Scheme has

been launched by the bank?

¾ No meritorious students should be denied of right of education for

want of funds/money
¾ It facilitates Human Resource Development of the country.
¾ Moreover the student may prove future potential and loyal
customer.
¾ This is our future marketing efforts by investing in HRD for future
Banking market.

19. Produce marketing loan is introduced, Why?

¾ In order to prevent distress sale of farm produce by the farmers

¾ It facilitates the farmers to procure better prices on future date
¾ It increase the negotiating and marketing ability of farmers.

20. No upper limit is fixed for KCC?

¾ The total annual production credit requirement of the farmer is

arrived at by considering the land holdings & cropping patterns.
¾ The scale of finance or Unit Cost differs from place to place
¾ As such, operationally it is not possible to fix maximum loan amount
under KCC

21. Bank is giving more thrust on KCC.

¾ KCC is an adequate & timely support from the Banking System

to the farmers for their full year short term production credit
needs
¾ It includes cost of cultivation, purchase of inputs & also the cost
of running ancillary activities besides contingent/consumption
needs in flexible and cost effective manner.
¾ This not only helps banks in increasing its credit exposure to
Agl. Segment but also to achieve 18% stipulated target but
also helps in increasing food grains for masses
¾ Moreover it reduces unemployment in Agl. Sector.

22. Bank can also finance two wheelers under KGC.

¾ It facilitates the farmers in farm production work & marketing of farm produce for
procuring better prices. It enhances the marketing ability of the farmers through
market survey, Negotiation of Price etc.

23. KGC is introduced, why?

¾ In order to cater the entire investment needs of the farming community including
contingency & marketing needs of farm produce
¾ It gives more thrust to Agl. Development through investment in land reclamation
and farm mechanization.

24. Working hours under Krishi Plus is 1500 hrs. p.a. whereas in Tractor
Loan it is 600 hours p.a.
 ¾ Under Krishi Plus the cultivable land criteria is 1 acre which is not sufficient
enough to generate income for repayment of loan
¾ The increased work hours of 1500 p.a. has been fixed to encourage the rural
youth to go for custom-hiring to increase income for viability of the Scheme.

25. We take appropriate margin before giving loan to borrower, Why?

¾ In order to have Stake of the borrower in the business

¾ It ensures total involvement & commitment of the borrower in
managing affairs of business
¾ It is also a margin of safety for normal wear & tear of, to
neutralize inflationary effect of the primary security charged.

26. Bank has to create investment fluctuation reserves?

¾ Investment fluctuation reserves is maintained for hedging

Interest. Risk. It facilitates absorption of Interest. Loss due to
upward movement of Interest. Rates.

27. STEP has been introduced why?

¾ In order to have highly innovative & effective payment solution

to ensure transfer of funds with speed & efficiency between the
branches.
¾ It is a superior mode of fund transfer over conventional T.T.
¾ It facilitates to cater the needs of Govt. Institute, PSUs and
other valued corporate customers
¾ It is a value addition to customer service with no extra cost &
helps to remain competitive.

28. Special Scale of Finance fix for Contract Farming?

¾ In order to provide adequate production credit requirement

under contract farming, as the cost of inputs like Seeds,
fertilizers, Pesticides, techniques are much higher compare to
conventional farming.

29. Bank is allowed to take over Agl. Advances, Why?

¾ In recent past the Bank has failed to achieve the minimum

Priority Sector Agl. Lending 18%.
¾ The proportionate shortfall is required to be deposited in RIDF
which carries lower interest.
¾ Taking over will facilitate growth in Agl. Adv., Gross Income, to
achieve stipulated targets.
¾ Moreover our lower interest. Rate can be converted into
business proposition in Agl. Segment.

30. A Back up Register showing month wise average hits are maintained
at the Branches

¾ This register facilitates abstention of incentives as per

Corporate Office TPM on the basis of average no. of
transaction hits at the ATM this month.
 ¾ Reflects position of reconciliation of ATM Cash Balance with
that of Switch Centre, Belapur
¾ Facilitates verification by Controllers/auditors. Etc.

31. Incentives under TPM is being given to branches on the basis of

average no. of Transaction hits in the ATMs

¾ In order to encourage Branches for cross selling of ATM cum

Debit Card products.
¾ Create awareness among the operating staff to market
maximum no. of ATM cards to achieve the goal of reducing
transaction cost.
¾ Facilitate Technology based products as business proposition
and enhancement of free income.
¾ To remain competitive.

32. e-Rail facility has been introduced?

¾ This is one of the technology based business innovation which

facilitates on line Rail Ticket Booking
¾ Provides Customer convenience and value addition to
customer service.
¾ Provides opportunity to increase fee based income of the
Bank’s besides competitiveness of the bank.

33. Xpress Credit has been launched, why?

¾ Xpress Credit is a pre-approved confessional loan which has

been launched to give thrust to P Segment Advances
¾ To prevent weaning away of our customers by Competitors at
captive branches.
¾ To woo back employee of PSUs/Govt. organization to captive
branches.

33. Bank has entered into tie-up arrangement with M & M for financing
Light & Medium commercial vehicles?

¾ In order to increase our business under SBF Seg.

¾ Financing up to 10 vehicles by optimum utilization of our vast
retail network of Branches will help to achieve our Priority
Sector lending target.
¾ It will also give boost to infrastructure sector/manufacturing
sector and employment generation.
¾ Total financial solution for customers at Competitive prices.

34. In OLTAS System, every Income Tax Challan Tender at the

Branches has to be branded with a Challan serial number.

¾ Challan Serial No. is an unique number generated by the

computer.
¾ It facilitates the tax payer to tract the credit of the tax payment
to his PAN of TAN no. through Income Tax Website “Tax
Information Network” (http:/tin.nsdl.com)
¾ To avoid complain in this regard and provide satisfaction to the
tax payers.
35. Bank charges less interest on Car loans at Urban & Metro Centers,
Why?

¾ In order to attract more high value car loan customers at these

Centers.
¾ Moreover, it will facilitate to meet the tough competition at
these Centers by the foreign and private banks.

36. MoF is giving thrust for M&A for banks.

¾ Consolidation of Bank’s through M&A was one of the

recommendations of Narasimhan Committee.
¾ Small & Week Bank Pose systemic risk with their low CAR &
NPA.
¾ Consolidation through M & A will facilitate the Banks to enlarge
their spread & market share and also to compete globally.
¾ Enable the Banks to manage their risk more efficiently
particularly after adoption of Basle II norm in 2006.
¾ It will allow economy of state in terms of manpower & other
resources.
¾ It will enhance efficiency & profitability

37. CAC has been introduced, why?

¾ This is part of BPR to outsource Cash management from the

Branches.
¾ It will enable Branches to focus on customer service, marketing
of products & cross selling
¾ It will reduce cost/enhance Branch profitability & help to remain
competitive.

38. Agri Business Unit has been set up by the Bank.

¾ It is a strategic re-engineered process initiated by the bank to

provide focused attention to bring about qualitative &
quantitative improvement in Agl. Lending.
¾ It will facilitate design & launch customized Agl. Products & to
establish Agri business driven corporate relationship
to transform Agri banking into “Agri Business”.
¾ It will help to increase our market share by financing across
value chain besides achieving P.S target & sub targets for Agl.
Lending.

39. Under TPM, incentives are being given to the Branches for
cash withdrawals.

¾ In order to induce branches to educate customers for more and

more uses of ATMs.
¾ It will accelerate migration of customers to ATM & reduce work
load at the Branch.
¾ The branches will be able to focus on customer service,
marketing & cross selling.
 ¾ This will result in reduced transaction cost, improve profitability
& competitiveness.

40. The amount of incentives for ATM hits has been reduced under TPM,
why?

¾ Increased no. of ATMs will enhance customer convenience &

customer satisfaction.
¾ Further help branches to free itself for marketing & cross
selling.
¾ It will provide edge over competitors on account of reduced
cost of transaction and world class services through increased
usage of ATMs.

41. A Bank-up Register showing month wise average hits ATM wise &
Position of reconciliation of ATM cash is maintained at the Branches?

¾ It facilitates in arriving at the incentive to the Branches on the

basis of details provided by the ATM switch centre, Belapur.
¾ It also reflects reconciliation of ATM cash and facilitates
verification by the auditors.

42. “SBI – Flexi Housing Loans" has been launched?

In order to :

¾ build in value added and customer friendly features to our HL

products.
¾ cater the MNF customers who propose to avail high value HL
and hedge their interest risk against the likely further
movement of latest rates.
¾ maintain competitive edge over

43. SBI-Maxgain has been launched?

¾ This is a value added customized product launched to tap the

significant market potential. Particularly to HNI customers & to
have edge over competitor.
¾ The product mixed with other HL innovation products like SBI
Reality & ”SBI Flexi” will facilitate to attract business from Mass
Affluent Seg, professionals, highly paid executives.
¾ This provides an opportunity to the customer reduce their
interest list and remain liquid.

Part II

) We obtain nomination facility in every Deposit Accounts.

¾ One of the Talwar Committee recommendations to improve customer

service.
¾ Facilitates expeditious settlement of claims in deceased accounts
without cumbersome legal process.
¾ Provides relief to aggrieved family of the deceased customer.
¾ Saves time, labour & cost at the operating level.
¾ Improves customer satisfaction & image of the Bank.
(ii) We do not prepare opinion report on company while making finance to
the Company .

¾ A company is an artificial legal, incorporated body having perpetual

succession.
¾ The Balance Sheet along with Auditor's report facilitates in arriving at
the Net worth of the Company and as such serves the purpose of
opinion report.

(iii) All ATM Cardholders are advised to change their PIN when they first use
their card.
¾ The four digit PIN is a secret code.
¾ This preventive measure protects interest of the card Holder against
any unauthorised access of ATM services by some unscrupulous
person.
¾ Moreover, it is the Card Holders responsibility to maintain secrecy &
Bank bears no responsibility/ liability for unauthorised use of the
Card.

(iv) Cartridge Backup is taken at the time of EOD at the Branches.

¾ This is one of the preventive measures adopted for preserving the

Data.
¾ It facilitates restoration of data & smooth /uninterrupted function of
the Branch in case of any eventuality.
¾ It provides data integrity & ensures safety of the system.

(v) We offer optional life cover to housing loan borrowers.

¾ This is a value addition in our marketing efforts of housing loan.

¾ Facilitates to remain competitive vis- a- vis other private players.
¾ Repayment/liquidation of loan amount out of claim proceeds
provides relief to aggrieved family.
¾ Facilitated cross selling & stops slippage of Assets.

(vi) Price of Gold is circulated on monthly intervals.

¾ Market driven Gold pricing is fluctuating in nature.

¾ Circulation of price facilitates in arriving at the Advance value of gold
ornaments for fixing the Limit while financing against gold
ornaments.
¾ Moreover, it helps in fixing drawing power of existing gold loan in
Over Draft Accounts.

(vii) Green Channel Programme for excellence has been introduced .

¾ Introduced on the recommendations of R.V.Gupta Committee to bring

about cross fertilisation of ideas & experience among the participants
to upgrade their skill in Agricultural lending.
¾ To provide inputs on developing leader ship & motivational skills by
Behaviour Science faculties of STCs.
¾ To accord recognition & reward excellent performers in Agricultural
intensive Branches.
¾ To impart special skill to handle large value Agl. Advances.
 ¾ Moreover, it is learning with pleasure & pride.

(viii) KYC guidelines have been introduced by the Bank .

¾ To identify the genuineness of new/existing customers beyond doubt.

¾ Facilitate maintaining comprehensive customer profile.
¾ Facilitates monitoring & reporting of high value and suspicious
transactions.
¾ Prevents tax evasion, money laundering and terrorist financing
through banking channel.
¾ This is a risk mitigation tool & is also required as per international
best banking practices.

(ix) Input vouchers are being prepared for non financial transactions for
making entries in to the system.

¾ It is preventive measure adopted for facilitating input control.

¾ It facilitates checking of daybooks & records relating to non-financial
transactions being put through the system.
¾ Ensures that the non-financial transactions have been put through the
system duly authorised by an official within the powers delegated to
him by the Bank.

(x) Bank is making finance below PLR .

¾ To remain competitive and retain the existing customers.

¾ It is marketing strategy to attracting new business & increase our
market share.
¾ Moreover, financing below PLR to weaker section/ small borrowers
facilitates to achieve priority sector benchmark and employment
generation.

(xi) Customer Committee meeting is being held at the Branches at regular

intervals.

¾ In order to create awareness among the staff members towards

identification of customer inconvenience and get their feed back to
improve the customer service.
¾ It increases customer orientation of the staff members and their
involvement in providing better customer service and customer
convenience at the Branches.
¾ It also provides a platform for drawing strategies for marketing bank's
product & services for increasing business.

(xii) Anti-Virus software is being updated regularly.

¾ This is a preventive measure adopted to prevent system from virus

attacks.
¾ It detects new virus which keeps coming everyday & isolates them to
keep the system clean for smooth functioning of the Branch.
(xiii) Drop Box system for deposits of cheques have been introduced.

¾ This is re-engineered business process introduced to provide 24 hours

non cash transactions facilities like deposits of cheques etc to the
customers.
¾ It facilitates hassle free customer service round the clock, helps to
improve customer convenience and migration of customers to
alternate channels.
¾ Provides time to the Branches to focus on business development &
cross selling.

(xiv) X- Press Credit Scheme has been introduced.

¾ It is re-engineered product to cater to the needs of captive Branch's

salaried customers.
¾ The pre sanctioned concessions in interest rates, NMI criteria will
cease the flight of accounts of customers to others Banks.
¾ It will improve our P - Segment advances and help to retain
customer's loyalty.

(xv) New Current Account opening Form for non- individuals has been
introduced?

¾ It provides comprehensive data as per KYC guideline.

¾ Facilitates operational convenience & completion of all formalities at
the operational level.
¾ Reduces chances of opening of fictitious/ fraudulent accounts at the
Branches.

(xvi) We do not take introduction while opening an account of a Company?

¾ The Certificate of Incorporation issued by Registrar of Companies

serves the purpose of identification of Company as a legal person with
perpetual succession.
¾ The MOA & AOA along with Board resolution serves the purpose of
address & objective /activity of the Company.

(xvii) We open deposit account in the name of minors.

¾ The Bank does not run any risk or incurs any additional obligation in
dealing with minor so long as the balance in the account is in credit.
¾ Such accounts are opened to inculcate savings habit among the
coming generation. They may prove our potential customers in future.

(xviii) No advances are granted against Bank's own shares.

¾ Sec. 20 of Banking Regulation Act1949, and Sec. 34 of SBI Act.1955,

prohibits sanction of loan against Bank's own shares.
¾ Moreover, it will tantamount to reduction of its own shares.

(xix) Banking is giving more thrust on Contract Farming.

¾ Contract Farming is an innovative business module which provides

farmers centric one stop solution with modern management outlook
 for improved quality agricultural produce, processing & delivery to
end users economically and efficiently.
¾ It is profitable for both the company & the farmers, contract company
gets quality produce & the farmers gets better assured price.
¾ It facilitates efficient utilisation of economic land holdings.
¾ Bank can improve market share in Agricultural lending, get better
returns on account of less incident of NPA.
¾ It will facilitate to achieve the targeted Agricultural lending of 18 % .

(xx) Internet banking facility is being marked aggressively.

¾ Internet banking is an alternate channel of delivery of product &

services.
¾ It facilitates migration of customers to alternate channels of delivery.
¾ Helps in reduction of transaction cost and attract new generation
techno savvy customers.
¾ Will help to compete with other private techno savvy Banks and
globalisation of operations.