CMS Report 1

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Project on:

The Cash Management Services Market in India

Presented to:

ICICI Bank

&

N. L. Dalmia Institute of Management Studies and

Research

Presented By:

Kamal Purohit

P.G.D.B.M

Batch: 2009-11

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DECLARATION

I,Kamal Purohit, student of N. L. Dalmia Institute of Management Studies &

Research, studying MMS Course hereby declare that I have completed the

project on The Cash Management Services Market in India in the academic

year 2009-2010. The information submitted is true and original to the best of

my knowledge.

SIGNATURE

__________________

ACKNOWLEDGEMENT

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It gives me immense pleasure to thank the people who have guided me throughout

my project. I am not sure if I will ever be able to repay them for all their invaluable support,

time and guidance. My project bears the imprint of many people.

I take this opportunity to express my deep and sincere gratitude to Mr. Amar Doshi, Product

Manager, CMS, ICICI Bankfor his timely support. It is because of his support that I could

synchronize the efforts in converting the manifold features of the project. I would also like to

thankMr. Praveen Trivedi, DGM, ICICI BANKfor selecting me to complete a project in his

department.

I wouldalso like to express my sincere gratitude towards Prof P. L. Arya (Director, N. L.

Dalmia Institute of Management Studies & Research)for his support and guidance.

Finally I am thankful to all the employees of ICICI Bank, who have given their full support in

collecting the required information and continuous help during the preparation of the

project.

I thank you all!!

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TABLE OF CONTENTS

TOPIC Page no.

1. Executive Summary 5

2. Introduction to Cash Management Services 6

3. Benefits of Cash Management 7

4. Cash Management Services generally offered 8

5. Cash Management Services- Indian Scenario 11

6. Industry Analysis and target segments 13

7. Cash Management Services at ICICI Bank 22

8. Product Analysis 26

9. Competitive Analysis 28

10. SWOT Analysis 67

11. Analysis of Cheque Clearing 68

12. Questionnaire Design 73

13. Survey Report 83

14. Conclusion 99

15. Recommendations 100

Executive Summary

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Cash management is a broad term that covers a number of functions that help individuals and

businesses process receipts and payments in an organized and efficient manner.

Administering cash assets today often makes use of a number of automated support services

offered by banks and other financial institutions. The gamut of cash management services

range from simple checkbook balancing and other types of securities to automated softwarethat allows easy cash collection.

When it comes to cash collections, there are a few popular options today that can make the

process of receiving payments from customers much easier. Automated clearing houses make

it possible to transact a business to business cash transfer that deducts the payment from the

customer account and deposits the funds in the vendor account. Generally, this service is

available for a fee at local banks.

Lockbox services are also often used by businesses to speed up the Accounts

Receivable process. Cash management by lockbox requires the establishment of a post office

box for the client. The vendor uses this post office address as the remittance address on

all invoices. As payments are received, the financial institution collects the payments, posts

them to the operating account for the customer. The customer can usually access daily reports

that can be downloaded and used for posting payments into the company Receivables.

Because of the increased incidence of check fraud, the concept of account reconcilement

services has become a must for many companies. Essentially, an ARC will keep the

checkbook for an operating account balanced at all times. As an additional level of protection,

the ARC allows the client to upload a daily listing of checks that have been issued on the

account. In the event a check is presented that is not included on the authorized lists, the bankwill reject the check.

There are a number of cash management options offered by local banks. In some instances,

the cost for the services can be costly. However, many businesses find that the savings in time

coupled with the high degree of accuracy more than make up for the charges associated with

cash management support services. The project aims to understand the Cash Management

Services offered by the banks. It also tries to understand the Cash Management Services

market in India, the need of customers and the current status of CMS products in the Indian

market. The objective of the report is to get a thorough understanding of the process of CMS

and how the market functions. It also tries to identify growth opportunities for the market bytrying to understand the needs of the customers using CMS

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Introduction to Cash Management Services

Manage your cash flow and liquidity-Effectively and Efficiently

For any organization, cash is the lifeblood that keeps the business going. That is why,

increasingly, Cash Management has been gaining importance with organizations that

view the services as a crucial part of their corporate strategies.

Cash Management is Efficient Management of cash (Outflows/Inflows) to improve liquidity

and returns while implementing adequate control and managing risks. Cash Management can

generally be defined as the efficient utilization of cash through coordinated management of

payments, collections and cash balances. The objectives are to reduce costs, enhance control

and optimize returns as well as reduce the inventory holdings. Traditionally, cash

management involved personalized services offered by the bank's staff to the company's

treasurer via mails, telephone, calls, faxes etc or visits to the bank initiated transactions. But

with the advent of computer technology, cash management services have been automated to a

large extent. Many banks now allow their corporate customers to perform online inquiries and

transaction services (payment, collection and liquidity management) through PC or Internet

via a web interface. With such a system in place, a company can perform most of the cash

management functions themselves without relying on a bank staff to act as the executor of

their requests.

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Benefits of Cash Management Services

1. Properly timing the disbursements.

Some payments must be made on a specified or legal date, such as Social Security payments.

For such payments, there is no cash management decision. For other payments, such as

vendor payments, discretion in timing is possible. Government vendors face the same cash

management needs as the Government. They want to accelerate collections. One way vendors

can do this is to offer discount terms for timely payment for goods sold.

2. Eliminating idle cash balances.

Every Rupee held as cash rather than used to augment revenues or decrease expenditures

represents a lost opportunity. Funds that are not needed to cover expected transactions can be

used to buy back outstanding debt (and cease a flow of funds out of the Treasury for interest

payments) or can be invested to generate a flow of funds into the Treasurys account.

Minimizing idle cash balances requires accurate information about expected receipts and

likely disbursements.

3. Ensuring timely deposit of collections.

Having funds in-hand is better than having accounts receivable. The cash is easier to convert

immediately into value or goods. A receivable, an item to be converted in the future, often is

subject to a transaction delay or a depreciation of value. Once funds are due to the

Government, they should be converted to cash-in-hand immediately and deposited in the

Treasury's account as soon as possible.

4. Monitoring exposure and reducing risks

The Banks have the responsibility to use timely, reliable, and comprehensive financial

information and systems. To that end, banks encourage to improve their cash management

practices by using electronic funds transfer (EFT) whenever cost effective, practicable, and

consistent with statutory authority. So there is a need to monitor the exposure and reduce the

risk.

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Cash Management Services generally offered

The following is a list of services generally offered by banks and utilized by larger businesses

and corporations

1. Account Reconcilement Services: Balancing a checkbook can be a difficult process

for a very large business, since it issues so many checks it can take a lot of human

monitoring to understand which checks have not cleared and therefore what the

company's true balance is. To address this, banks have developed a system which

allows companies to upload a list of all the checks that they issue on a daily basis, so

that at the end of the month the bank statement will show not only which checks have

cleared, but also which have not. More recently, banks have used this system to

prevent checks from being fraudulently cashed if they are not on the list, a process

known aspositive pay.

2. Advanced Web Services: Most banks have an Internet-based system which is more

advanced than the one available to consumers. This enables managers to create and

authorize special internal logon credentials, allowing employees to send wires and

access other cash management features normally not found on the consumer web site.

3. Armored Car Services: Large retailers who collect a great deal of cash may have the

bank pick this cash up via an armored car company, instead of asking its employees to

deposit the cash.

4. Automated Clearing House: services are usually offered by the cash management

division of a bank. The Automated Clearing House is an electronic system used to

transfer funds between banks. Companies use this to pay others, especially employees

(this is how direct deposit works). Certain companies also use it to collect funds from

customers (this is generally how automatic payment plans work). This system is

criticized by some consumer advocacy groups, because under this system banks

assume that the company initiating the debit is correct until proven otherwise.

5. Balance Reporting Services: Corporate clients who actively manage their cash

balances usually subscribe to secure web-based reporting of their account and

transaction information at their lead bank. These sophisticated compilations ofbanking activity may include balances in foreign currencies, as well as those at other

banks. They include information on cash positions as well as 'float' (e.g., checks in the

process of collection). Finally, they offer transaction-specific details on all forms of

payment activity, including deposits, checks, and wire transfers in and out, ACH

(automated clearinghouse debits and credits), investments, etc.

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6. Cash Concentration Services: Large or national chain retailers often are in areas

where their primary bank does not have branches. Therefore, they open bank accounts

at various local banks in the area. To prevent funds in these accounts from being idle

and not earning sufficient interest, many of these companies have an agreement set

with their primary bank, whereby their primary bank uses the Automated ClearingHouse to electronically "pull" the money from these banks into a single interest-

bearing bank account.

7. Lockbox services: Often companies (such as utilities) which receive a large number

of payments via checks in the mail have the bank set up a post office box for them,

open their mail, and deposit any checks found. This is referred to as a "lockbox"

service.

8. Positive Pay: Positive pay is a service whereby the company electronically shares its

check register of all written checks with the bank. The bank therefore will only pay

checks listed in that register, with exactly the same specifications as listed in the

register (amount, payee, serial number, etc.). This system dramatically reduces check

fraud.

9. Sweep Accounts: They are typically offered by the cash management division of a

bank. Under this system, excess funds from a company's bank accounts are

automatically moved into a money market mutual fund overnight, and then moved

back the next morning. This allows them to earn interest overnight. This is the

primary use of money market mutual funds.

10.Zero Balance Accounting: It can be thought of as somewhat of a hack. Companies

with large numbers of stores or locations can very often be confused if all those stores

are depositing into a single bank account. Traditionally, it would be impossible to

know which deposits were from which stores without seeking to view images of those

deposits. To help correct this problem, banks developed a system where each store is

given their own bank account, but all the money deposited into the individual store

accounts are automatically moved or swept into the company's main bank account.

This allows the company to look at individual statements for each store. U.S. banks

are almost all converting their systems so that companies can tell which store made a

particular deposit, even if these deposits are all deposited into a single account.Therefore, zero balance accounting is being used less frequently.

11.Wire Transfer: A wire transfer is an electronic transfer of funds. Wire transfers can

be done by a simple bank account transfer, or by a transfer of cash at a cash office.

Bank wire transfers are often the most expedient method for transferring funds

between bank accounts. A bank wire transfer is a message to the receiving bank

requesting them to effect payment in accordance with the instructions given. The

message also includes settlement instructions. The actual wire transfer itself is

virtually instantaneous, requiring no longer for transmission than a telephone call.

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12.Controlled Disbursement: This is another product offered by banks under Cash

Management Services. The bank provides a daily report, typically early in the day,

that provides the amount of disbursements that will be charged to the customer's

account. This early knowledge of daily funds requirement allows the customer to

invest any surplus in intraday investment opportunities, typically money marketinvestments. This is different from delayed disbursements, where payments are issued

through a remote branch of a bank and customer is able to delay the payment due to

increased float time.

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Cash Management Services - Indian Scenario

The need for cash management aroused two decades ago in the mid eighties when the Indian

corporates were facing various problems like the uncertainty as to when funds would be made

available to them, the problem of long transit period between banking cheques and receivingfunds, long period of administrative work in banking cheques and tracking progress and

reconciliation problems regarding uncertainty of inflows and lack of details on each credit to

the account. It is important to review the Indian scenario in this regard. As we are all aware,

that the banks desire for funds has lost because of the slowdown. Despite the offer of very

soft terms corporates are refusing to borrow, while bank deposits have been ballooning.

Compelled to service the burgeoning liabilities, but unable to lend hastily and allow their

non-performing assets (NPAs) to grow, bankers are forced to compete for the handful of safe

bets among their borrowers.

Banks chose to use the opportunity to refocus their activities, seeking clearly definedidentities in terms of services and customer segments. Most of them concentrated on cleaning

up their books by peeling down their NPAs. All of them are attempting for freezing of costs,

improving operational efficiencies, and boosting productivity. The strategy of the banks,

which are performing well, is to use fee-based services to maintain their earnings growth.

With interest rates falling, non-interest income is, unsurprisingly, the fastest-growing

component of the banks total income. Fee-based activities will complement though not

substitute the core business of lending. With rising interest rates too, Corporate and others are

not willing to borrow, fee-based services play again an active role in boosting a Banks total

income.

It is gratifying to note that a number of banks in India are offering wide-ranging cash

management services to their corporate clients. All the three categories of banks viz.,

nationalized banks, private banks, and foreign banks operating in India are active in the cash

management segment. SBI, PNB, Corporation, ICICI Bank, HDFC Bank, Centurion Bank of

Punjab and ING Vysya Bank, are some of the active Indian banks in this segment. Citi Bank,

Standard Chartered Bank, ABN Amro Bank, BNP Paribus, and HSBC are the foreign banks

operating in India, which are prominent among the cash management services providers.

Indian banks are offering services like electronic funds transfer services, provision of cash

related MIS reports, cash pooling services, collection services, debit transfer services,guaranteed credit arrangements, sweep products, tax payment services, receivables and

payables management.

Foreign banks operating in India are offering regional and global treasury management

services, liquidity management services, card services, electronic banking services,

ecommerce solutions, account management services, collection management services, cash

delivery management services and investment solutions. Banks realized that if they do not

offer the services required by corporate customers it would result in a net loss of clientele,

returns and goodwill. Banks in India need to continuously monitor international trends in

innovations taking place in providing cash management services and swiftly offer similarservices to their corporate clients. The Reserve Bank of India is taking a number of

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initiatives, which has facilitated the active involvement of commercial banks in the

sophisticated cash management segment. One of the prerequisites is to ensure faster and

reliable mobility of funds in a country and to have an efficient payment system. Considering

the importance of a robust payment system to the economy, the RBI has been taking

numerous measures since mid Eighties to strengthen the payments mechanism in the country.Introduction of computerized settlement of clearing transactions, use of Magnetic Ink

Character Recognition technology, provision of inter-city clearing facilities and high value

clearing facilities, Electronic Clearing Service Scheme , Electronic Funds Transfer scheme,

Delivery vs. Payment for Government securities transactions, setting up of Indian Financial

Network are some of the significant initiatives which highlight the seriousness with which the

Reserve Bank has taken up the reforms in Payment systems.

Introduction of a Centralized Funds Management System, Securities Services System, Real

Time Gross Settlement System and Structured Financial Messaging System are on the top

priority items of the agenda to transform the existing systems into a state-of-the-art paymentinfrastructure in India by the Reserve Bank. The current vision envisaged for the payment

systems reforms is one, which contemplates linking up of at least all important bank branches

with the domestic payment systems network thereby facilitating cross border connectivity.

With the help of the systems already put in place in India and which are coming into being,

both banks and corporate can exercise effective control over the cash management.

Industry Analysis and Target Segments

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Cash Management Services (CMS) is required across different industries and every industry

has its own specific Cash Management need. Ten different industry segments were chosen

and analyzed on the following factors:

1. Major Players in the Industry

2. Features of the Industry on the whole

3. Need for Cash Management

The industry analyzed and the findings are as shown below:

a. Construction:

The various players in this industry are:

Larsen & Toubro: Annual turnover of Rs 339263 million

Punj Llyod: Annual turnover of Rs 68879 million

JP Associate: Annual turnover of Rs 57641 million

IVRCL Infra : Annual turnover of Rs 49830 million

NagarCons : Annual turnover of Rs 41514 million

Features:

Experiencing growth to due to increase in demand.

Not too dependent on government policies.

Has government support as it wants more development.

Eg: DLF tie up with DDA

Lot of diversification opportunities possible

Eg: Unitech investing in hotel construction

It is a cyclical industry as demand generally depends on the state of the

economy

Cash Management Services need:

The industry can have Cash Management Services

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Companies have multiple projects running which makes keeping track of

payments to suppliers difficult

These companies hire contractors for work. They can be paid using Auto

Clearing services

These companies have multiple collection issues once the project is

underway. The bank can act as a collector

CMS can help the companies in delay of supplies due to delay in payments

CMS can help them have a centralized MIS which the company and the

suppliers can access for better operations

b. Hospitality:

The various players in the industry are:

IHC Ltd: Annual turnover of Rs 16195 million

EIH : Annual turnover of Rs 8886 million

Oberoi Group: Annual turnover of Rs 2147 million

Hotel Leela Venture: Annual turnover of Rs 4522 million

Asian Hotels Ltd: Annual turnover of Rs 6415 million

Features:

The Hospitality industry is witnessing a boom due to increased

international as well as domestic demand

Not too dependent on government policies.

Has government support as it is encouraging tourism through various

campaigns

Price of service is dependent on many factors which make it a price

sensitive industry

It is a cyclical industry as demand generally depends on the state of the

economy as well as current political situation


The industry can have Cash Management Services (CMS)

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Companies have a chain of hotel in different cities. They can have a

centralized payment and collection structure

For a particular hotel payables can be managed through auto clearing

services

Receivables from customers can be managed through a concentration

account.

Every hotel can have a centralized MIS to maintain inventory levels

and stockouts. Also automatic order system can be set up through the bank

The payments made and received can be maintained using auto

reconcilement services

c. FMCG:

The various players in this industry are:

HUL Ltd: Annual turnover of Rs 205170 million

Dabur India: Annual turnover of Rs 23961 million

Colgate Palmolive: Annual turnover of Rs 16948 million

Nirma: Annual turnover of Rs 30000 million

Marico Industries Ltd: Annual turnover of Rs 19174 million

Features:

A major portion of the monthly budget of each household is reserved

for FMCG products. So there is no problem of demand

The volume of money circulated in the economy against FMCG products

is very high, as the number of products the consumer use is very high

Competition in the FMCG sector is very high resulting in high pressure on

margins.

Manufacturing in the company can be outsourced


The industry can have Cash Management Services (CMS)

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As manufacturing is outsourced it important to maintain payables and

receivables

These companies have a tight working capital policy. CMS can help

them maintain that

These companies have strong distribution networks. Transactions with

these networks can be maintained by a centralized system

d. Oil and Natural Gas:


Reliance Industries: Annual turnover of Rs 1418474 million

BPCL: Annual turnover of Rs 1352377 million

HPCL: Annual turnover of Rs 1254869 million

India Oil Corp: Annual turnover of Rs 3070485 million

ONGC: Annual turnover of Rs 636187 million

Features:

They provide the basic material for fuel

They are highly dependent on government policies

Pricing is subsidized and they bear the brunt of subsidies

They are one of the most profit making companies in India

Eg: ONGC


These companies do not necessarily need CMS

These companies are owned by the government and are highly regulated

Their operations is mostly overlooked by the government

e. Aviation:

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Jet Airways: Annual turnover of Rs 114769 million

Kingfisher Airlines: Annual turnover of Rs 52691 million

Spice Jet: Annual turnover of Rs 16894 million

Global Vectra Helico: Annual turnover of Rs 2000 million

Features;

It is one of the most rapid growing industry of the 90s

It has immense potential for growth

It is capital intensive industry

It is dependent on government policies

It is a cyclical industry as demand depends on the state of the economy


The aviation companies can have Cash Management Services (CMS)

It can have a centralized salary disbursement along with other payables

The company has interest payments on fleet which can be

automatically adjusted by the bank

The receivables in terms of inventory can be maintained by the bank

f. Retail:

The various players are:

Future Value Retail: Annual turnover of Rs 66614 million

Shopper Stop Ltd: Annual turnover of Rs 14000 million

Trent: Annual turnover of Rs 5140 million

Vishal Retail: Annual turnover of Rs 13930 million

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Features:

It is one of the fastest growing industries of the 90s

It has immense future potential since the purchasing power of the

customers increase

Market is supposed to grow to $637 billion by 2015 from $300 billion in

2007

India is ranked 1st as the most attractive market for retail investments



The players in the industry have a chain of outlets. Payments andreceivables for the chain can be maintained by a centralized system

For a particular outlet inventory payments, petty cash payments can be

managed by the bank

The companies can have auto reconciliation to manage accounts in a

centralized manner

g. Steel:


SAIL: Annual turnover of Rs 436555 million

Tata Steel: Annual turnover of Rs 243157 million

JSW Steel: Annual turnover of Rs 140012 million

Essar Steel: Annual turnover of Rs 116883 million

Features:

India is the 5th largest producer of steel

Steel companies have shown robust growth during the past 5-7 years

It is a cyclical industry as demand depends on the state of the economy

It is dependent on government policies

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The companies can make payments to suppliers through a centralized

payment system

The company can have a centralized cash and cheque collection from

customers

Daily inventory purchases and petty cash expenses can also be

managed by a bank

h. IT:


TCS: Annual turnover of Rs 230444 million

Infosys: Annual turnover of Rs 211400 million

Wipro: Annual turnover of Rs 215073 million

Mah Satyam: Annual turnover of Rs 81372 million

Features:

Information Technology is the fastest growing sector of India, a sunrise

industry and the area of growth for the millennium

India's software and services exports were $17.2 billion in the fiscal year

ended March 31 this year, up by 34.5 percent from the previous year

The engineering, R&D and software products exports segment is expected

to grow by 14.4 per cent in the current fiscal year, to touch US$ 7.3 billion;

which highlights the strong impetus and renewed focus on improving IPdriven service capabilities in India.


The industry need not necessarily have CMS

These companies have a lot of intangibles. Thus their payables are less

These companies generally have their own software package in place for

collection and salary disbursements

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i. Pharmaceuticals:


Cipla: Annual turnover of Rs 49606 million

Ranbaxy Labs: Annual turnover of Rs 47802 million

Dr Reddys Labs: Annual turnover of Rs 41589 million

Sun Pharma: Annual turnover of Rs 38615 million

Features:

Indias pharmaceutical industry is one of the fastest growing sectors in the

Indian economy with the growth rate (CAGR) of 11.9 per cent during

2004-2008

The industry has emerged as one of the strongest and most successful

examples of knowledge-based industries in the world and it has made

tremendous progress in terms of development of technology, products and

infrastructure

The Indian pharmaceutical industry ranks fourth in the world in terms of

volume (8 per cent global share) and fourteenth in terms of value (1.9 per

cent global share).


The industry can have CMS

The companies can make payments to the suppliers through a

centralized system

The receivables can also be managed by such a system

They can manage all their accounts through account concentration

services

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j. Power:


NTPC: Annual turnover of Rs 419752 million

Rel. Infra: Annual turnover of Rs 97394 million

Tata Power: Annual turnover of Rs 72352 million

Suzlon Energy: Annual turnover of Rs 72355 million

Features:

Majority of Generation, Transmission and Distribution capacities are witheither public sector companies or with State Electricity Boards (SEBs)

Private sector participation is increasing especially in Generation and

Distribution

The industry has to bear the brunt of unbalanced growth


The industry need not have CMS

Most of the companies are owned by the government

The companies in this industry require long term investments

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Cash Management Services at ICICI Bank

ICICI Bank's Cash Management Services offer a full range of receivable and payable services

to meet your complex cash management needs. Payments received from your dealers/

distributors and made to your suppliers are efficiently processed to optimize your cash flow position and to ensure effective management of the operations of your business.

ICICI Bank provides a gamut of products and services, ensuring that all the business

requirements of the corporations are met under one roof. Further, ICICI Bank constantly

innovates and improves its product offerings in order to improve client servicing.

Key Benefits:

Widest network across India

Comprehensive range of CMS products

Strong logistics support

Advanced technology support and a highly competent team

Dedicated and trained Customer Care

Ensuring timely deposit of collections

Timely execution of disbursement request

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Collection Solutions

ICICI Bank offers a wide range of collection products to meet the specific requirements of

the clients like local cheque collections, upcountry cheque collections, cash collections and

electronic collections. With a wide network, customized MIS and multiple channels fordelivery of MIS, ICICI Bank renders quick and effective management of receivables.

CICI Bank offers a wide range of collection products to meet the specific requirements of the

clients. The products offered are as follows:

Local cheque collection through:

o ICICI Bank branches

o Correspondent bank branches

Upcountry cheque collection through:

o ICICI Bank branches

o Correspondent bank branches

o Other banks

RTGS integrated collections

Electronic collections (through auto-debit)

Cash collections through our Doorstep banking services

Features

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Wide network coverage of over 670 own locations and over 4200 correspondent bank

locations

Capability to process cheques drawn at any location

Assured payment on fixed day basis, irrespective of the fate of the instrument sent in for

clearing

Instrument outstanding report and credits in the pipeline report available to strengthen internal

control

Multiple channels available for receipt of data including e-mails, faxes, courier and the

Internet

Prompt realisation of cheques through an extensive network, supported by correspondent

banking relationships

Availability of information on the amounts deposited at multiple locations with informationavailable at the instrument level

Provision of uploading the system generated deposit slip details, in a single file

Customised MIS and availability of scan images of instruments at select locations

Payments

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The payment solutions offered by ICICI Bank include bulk disbursement solutions for

making payments to channel partners through multiple modes, Payable at Par solutions for

payment of dividend, interest or for redemption and Internet-based cheque writing facility for

printing of cheques at your own premises.

ICICI Bank offers payment solutions that cater to all the requirements of a corporation. The

payment product suite includes bulk disbursement solution through Integrated Payment

System, Internet-based cheque writing which facilitates printing of instruments at your own

office and Payable at Par solution for payment of dividend, interest and for redemption.

Key Features

Payment solutions of ICICI Bank offered through Integrated Payment System (IPS) not only

offers multiple modes of payment but also facilitates functional, operational and financialbenefits like:

Single file upload to effect multiple modes of payments

o Physical modes include cheques, demand drafts

o Electronic modes include direct credit to ICICI Bank account holders, RTGS

and NEFT

Web-based access for uploading and authorizing printing requests

ERP extractor for extracting data directly from the ERP system

Host-To-Host connectivity for Straight Through Processing of transactions

Data encryption for enhanced security

Partial batch authorization and processing

Dynamic signature printing

Printing of instruments and direct dispatch to beneficiaries

Tracking of dispatches

Advices over e-mail to beneficiaries

Customized annexure printing for cheques

At par cheques payable at over 700 locations

Customized MIS

Product Analysis

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Almost every bank in the country offers Cash Management Services (CMS). Thus it becomes

important to understand the different products offered by different banks. Undertaking a

product analysis helps the bank to understand where it stands when it s compared to

competing banks. It shows where the bank lies ahead and where It lags in terms of other

banks in the country. A product analysis was done to understand the different CMS products.

The following banks were included in the comparison:

1. Bank of India

2. Corporation Bank

3. HDFC Bank

4. Axis Bank

5. Citi Bank

6. HSBC Bank

7. Standard and Chartered Bank

Product/ Bank

Bank

of

India

Corp

Bank

Canar

a

Bank

ICIC

I

Bank

HDF

C

Bank

Axis

Bank

Citi

Ban

k

HSB

C

Bank

SCB

Collection Based

LCC Yes Yes Yes Yes Yes Yes Yes Yes Yes

UCC Yes Yes Yes Yes Yes Yes Yes Yes Yes

Foreign currency

cheque Yes No No No No No Yes Yes Yes

Cash Collection No No No Yes No No No Yes Yes

Post Dated

Cheque

Collection

Yes Yes No No No Yes No No No

Payment Based

ECS Yes Yes Yes Yes Yes Yes Yes Yes Yes

NEFT Yes Yes Yes Yes Yes Yes Yes Yes Yes

RTGS Yes Yes Yes Yes Yes Yes Yes Yes Yes

Payable at Par

chequesYes Yes Yes Yes Yes Yes Yes Yes Yes

International

PaymentsNo No No No No No Yes Yes Yes

Dividend

PaymentNo No No Yes Yes Yes No No No

Lockbox/Dropbo

xNo No No Yes No Yes Yes Yes Yes

Liquidity Mgmt No No No No No No Yes Yes Yes

Conclusions from Product Analysis

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1. All the products can be summarized in the following three categories

a. Collection Based

b. Payment Based

c. Liquidity Management Based

2. All the banks offer products which are of a similar nature

3. Foreign Currency Cheque Collections and Payments are offered only by theinternational banks in the market

4. Even Liquidity Management based products are offered by these banks

5. Cash collections is offered only by ICICI bank , HSBC Bank and Standard CharteredBank

6. Post Dated Cheque Collections is a prime product for Government Banks

7. The market is saturated with products of similar nature with no bank having abreakthrough product

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Competitive analysis

Competitive analysis in marketing and strategic management is an assessment of the strengthsand weaknesses of current and potential competitors. This analysis provides both an offensiveand defensive strategic context through which to identify opportunities and threats.

Competitor profiling coalesces all of the relevant sources of competitor analysis into oneframework in the support of efficient and effective strategy formulation, implementation,monitoring and adjustment. The Cash Management Services (CMS) industry is verycompetitive as almost every bank provides CMS. It becomes important to understandcompetition to keep up with the latest trends in the market.

1. HDFC Bank:

Product Definition:-

HDFC Bank Locations /Branches

Speed:-Local cheques collection at HDFC Bank Locations e.g. cheques deposited in Delhiand payable at Delhi.

Sprint:-Outstation cheques collection on HDFC Bank Locations e.g. cheques deposited atDelhi and payable at other HDFC Bank location say Pune, Chennai, and Mumbai etc

Correspondent Bank Locations /Branches

Rapid:-Local cheques collection at Corr Bank Locations e.g. cheques deposited in Wardhaand payable at Wardha.

Express:-Outstation cheques collection on Corr Bank Locations e.g. cheques deposited atChennai and payable at Corr Bank location say Munnar

Clean:-Outstation cheques collection on Non covered Locations e.g. cheques deposited atChennai and payable at Non covered location.

CMS Collection Products at HDFC Bank:

CMS Process Flow:

- Client can open only one corporate current account with HDFC Bank. Customers canalso use the existing corporate current account with the Bank for this CMS facility.

- A CMS Client code is provided to the company at the time of setup. All the deposits inthe CMS account are to be made with reference to this unique client code. All the chequescan be collected from the designated clients office through a courier service.

- If the courier facility is not availed, the cheques are to be deposited with the designatedHDFC Bank branch or a coordinator along with a specific CMS deposit slip for that

product before the cutoff time.

- Daily MIS is provided with the collections in the account for that particular day in a softcopy at the Email IDs given at setup by the client. The bank can customize the MIS in theformat as desired by your company.

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- E-Net viewing: Under this facility the company can view all the details that are required.The details are provided under 2 heads :

- The Account Viewing where you can see the account statement, balance, etc.

- The CMS module where the company can view the deposits on that day, the day of creditfor these cheques.

CMS Pricing and Arrangements:-

CMS offers you the facility of clearing of local / outstation instruments favoring anorganization deposited at our various branch locations with pooling of funds at Mumbai orany other location where HDFC bank has presence on very competitive terms. CMSeliminates the inherent delays of a traditional funds transfer mechanism. CMS enhancesliquidity and ensures optimum planning and utilization of funds. In addition to faster accessto funds, CMS provides you with MIS, which will help improve your reconciliation.

LOCAL CHEQUES & FUNDS TRANSFER (Subject to Clear Fund Basis)

Product Business

locations

Funds flow mechanism Service charges

Speed Localchqscollection

at HDFCBanklocation

Highvalue

DAY 0 Instrumentsdeposited at the respectivelocations before the

prescribed cut off time.

DAY 0- Funds pooled atMumbai** by credit toyour account with ourBank for deposits made atthe locations.

Nil

NonHighvalue

DAY 0 Instrumentsdeposited at the respectivelocations before the

prescribed cut off time.

DAY 2 - Funds pooled atMumbai** by credit toyour account with ourBank for deposits made at

the locations.

Nil

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OUTSTATION CHEQUES & FUNDS TRANSFER

PRODUCT

BUSINESSLOCATIO

FUNDS FLOW MECHANISM SERVICE

30

HBTRF chqscollection

at HDFCBanklocation

DAY 0 Instrumentsdeposited at the respective

locations before theprescribed cut off time.

DAY 1 - Funds pooled atMumbai** by credit toyour account with ourBank for deposits made atthe locations.

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NS CHARGES

Sprint HDFC Bank locations

DAY 0 Instruments deposited atthe respective locations before the

prescribed cut-off time for clearing.

DAY 4 - Funds pooled atMumbai** by credit to youraccount with our Bank.

Nil

** Funds will be pooled to your account with HDFC bank Ltd

OTHER CHARGES:

1. Rs.100/- flat per return instrument

2. Courier can be organized on behalf of the company for picking up the checks fromyour branches at Rs.400/- per pick-up location per month within City limits.

3. Service Tax and Educational Cess @ 12.36% shall be charged as applicable.

4. Outstation clearing courier charges Rs 20.00/packet.

VALUE ADDITIONS:

1. Daily report on location wise collections/returns.

2. Monthly report on total collections and service charges.

3. Monthly report on total payouts and service charges.

4. Enet facility to check / validate cheque collection across location at one central placethrough deposit and instrument query.

5. Any additional report, in mutual consultation which the company may be requiringfrom time to time.

DOCUMENTATION:

1. The company to execute an Application-cum-Agreement / Fax indemnity.

2. To provide a board resolution for availing the Cash Management Services from ourBank.

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3. To provide a list of signatories who are authorized to give instructions to the bank foroperating the services.

OTHER TERMS:

1. The above services are demand facilities, subject to our ongoing review and the termsconditions, pricing etc. may be modified or services recalled without notice at the

banks absolute discretion.

2. The process flow is exclusive of intervening bank holidays for clearing purposes.

3. There is no high value clearing on Saturdays, hence the process flow will changeaccordingly.

4. Sundays & other bank holidays have been excluded for the purpose of calculation ofthe above referred days.

NETWORK:

Express Locations: 778

Rapid Centres: 288

HDFC Bank Locations:

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1. Andaman and Nicobar Islands: 0 2. Andhra Pradesh: 18

3. Arunachal Pradesh: 0 4. Assam: 3

5. Bihar: 7 6. Chandigarh: 4

7. Chhattisgarh: 4 8. Dadra and Nagar Haveli: 1

9. Daman and Diu: 1 10. Delhi: 7

11. Goa: 6 12. Gujarat: 54

13. Haryana: 17 14. Himachal Pradesh: 9

15. Jammu and Kashmir: 2 16. Jharkhand: 9

17. Karnataka: 13 18. Kerala: 22

19. Madhya Pradesh: 18 20. Maharashtra: 29

21. Manipur: 0 22. Meghalaya: 1

23. Mizoram: 0 24. Nagaland: 0

25. Orissa: 9 26. Pondicherry: 1

27. Punjab: 45 28. Rajasthan: 16

29. Sikkim: 1 30. Tamil Nadu: 17

31. Tripura: 1 32. Uttar Pradesh: 23

33. Uttarakhand: 8 34. West Bengal: 13

2. BANK OF INDIA

Collection of cheques

Local Cheques & Upcountry cheques at places where Banks branches exist.

Upcountry cheques at places where Banks branches do not exist.

Instant credit as per arrangement on any day before realization.

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Customized MIS, Including outstanding entries at any time.

Pooling is possible, including multiple pooling.

Single point reference for any detail/data.

Courier Pick-Up from Customers Collections.

Post Dated Cheques Collection:

Post dated cheques (PDCs) vaulted, dispatched to drawee center three days in advancecollected on due dates and credited to account on due date or next day.

Tracking of customers invoices with PDCs possible.

Auto Reconciliation.

Unpaid/Returned PDCs also properly tracked and accounted.

All other advantages of collections.

Payments

Centralized or Remote printing of payments (Cheques/Pay Orders/DDs/IWs/DWs/Ros-withFacsimile signatures)

Printing of Cheques on continuous stationery.

Interface with RTGS/NEFT/ECS.(Linkage to e-modes)

Correspondent Banking Issue of DDs by branches*of Correspondent Bank.

Funding before issue/upon payment.

Auto Reconciliation.

(* On places where Banks CBS branches situate or even places where Banks branches notSuitable-thro similar correspondent /courier arrangement)

General:

Customized MIS of data in whichever way desired.

Interface between Finnacle and CMS Software.

Time Frame for Collection of Local / Outstation Cheques / Instruments :

For local cheques presented in clearing credit will be afforded as on the date of settlement offunds in clearing and the account holder will be allowed to withdraw funds as per return

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clearing norms in vogue.

Cheques / Instruments presented in high value clearing (with the minimum value of Rs. 1 lac)shall be credited on the same day (applicable only in areas covered by high value / same dayclearing).

For cheques and other instruments sent for collection to centres within the country, generallythe following time norms shall be applied :

a) Cheques presented at any of the four major Metro Centres (New Delhi, Mumbai, Kolkataand Chennai) and payable at any of the other three centres : Maximum period of 7 days.

b) Metro Centres and State Capitals (other than those of North Eastern States and Sikkim):Maximum period of 10 days.

c) In all other Centres : Maximum period of 14 days.

d) Cheques drawn on foreign countries: Such instruments are accepted for collection on thebest of efforts basis. Bank may enter into specific collection arrangement with itscorrespondent bank for speedy collection of such instrument. Bank would give credit to the

party on credit of proceeds to the banks Nostro Account with the correspondent bank aftertaking into account hold periods as applicable to the countries concerned.

The above time norms are applicable irrespective of whether cheques/instruments are drawnon the banks own branches or branches of other banks.

Service Charges:

Nature of Service Individual Non Individual

Cheques sent for

collection

Upto Rs 500- Rs 15 per instrument(PI)

Rs 501-100: Rs 25 PI

Upto Rs 500- Rs 10 perinstrument (PI)

Rs 501-100: Rs 20 PI

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Rs 1001-10000: Rs 50 PI

Rs 10001- 1 lac: Rs 100 PI

Above Rs 1 lac: Rs 150 PI

Rs 1001-10000: Rs 45 PI

Rs 10001- 1 lac: Rs 100 PI

Above Rs 1 lac: Rs 150 PI

RTGS (charges pertransaction)

Rs 1- 5 lacs: Rs 25

Rs 5 lacs and above: Rs 50

Rs 1- 5 lacs: Rs 25


NEFT and EFT Upto 1 lac: Rs 5 per transaction

Rs 1 lac and above: Rs 25 pertransaction

Upto 1 lac: Rs 5 per transaction

Rs 1 lac and above: Rs 25 pertransaction

ECS Credit Clearing (per entry/ item):

NCC Clearing House No charge

Destination Bank No charge

Sponsor Bank Rs. 5.50

(Min. Rs. 2500/-)

Debit Clearing (per entry/ item):

NCC Clearing House No charge

Destination Bank No charge

Sponsor Bank Rs. 4.00

(Min.Rs.2500/-)

Returning charges - Rs. 80/-

FREE

FREE

Returning charges - Rs. 50/-

Collection of

Bills

Upto Rs.10,000/- : Rs. 120/- per bill

Above Rs.10,000/- upto Rs.1 lac : Rs.12/- per

Rs.1000/- or part thereof (Min.Rs.250/-)

Above Rs.1 lac : Rs. 10/- perRs.1000/- or part

thereof Min. Rs.1200/- Max.Rs.35,000/-

Collection Charges

under Star Speed

Cheque collectionscheme

Upto Rs.5000/-: Rs.10/- perinstrument

Rs.5001/- to Rs. 50000/-: Rs. 15/- per

Same

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instrument

Rs.50001 to Rs. 1 lac : Rs. 20/- perinstrument

Above Rs. 1 lac: Rs. 30/- perinstrument

Cheque Return Charges

Due to technical reasons: Rs. 60/- per instrument PLUS entire out-of-pocket expenses.

Due to non-technical reasons_ Rs.100/- per instrument PLUS entireout-of-pocket expenses.

Collection charges

under Speed

Clearing

Instruments upto Rs. 1 lac: Nocharges

Instruments above Rs. 1 lac: Rs.150/- per instrument

Same

Network:





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11. Goa: 37 12. Gujarat: 268












3. Corporation Bank

Banks has been always aiming to create values for its customers. Looking beyond traditional

banking, the Bank introduced an array of other products and services to different customer

segments. Cash Management Services is one such solution offered by the Bank to the

corporate customers. Every organization has receivables to collect from its dealers/ depots/

customers. Every revenue collected by the organization gets paid in one form or the other.

Collection And Payment Services (CAPS) provides customized solutions to corporate' needsin liquidity management.

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Fast Collection Service

Fast Collection Service (FCS) is the premier product of the Bank under CAPS range of

products. FCS envisages elimination of one leg of movement of cheques from drawer to

beneficiarys place and travel back to speed up the process. The corporates can access the

collections effected at 301 LOCATIONS (OPERATING CENTRES) across the country

covered under the arrangement within 24 to 48 hours at a location of corporates choice.

Corp Clear Services [CCS]

CCS ensures quick collection of outstation cheques. The product enables assured credit on

predetermined day of corporates choice, in respect of upcountry cheques deposited with

specialized CAPS branches irrespective of the day of realization. The need-based product

range under this segment includes

Corp Clear Services - 8th* Day

Corp Express Services - 4th * Day

Corp Instant Services - Next Day

(* for cheques drawn on locations where CorpBank has branches)

Corp Collect Service [ CCT]

Corporates apprehensive of cheque realizations may use their Corp Collect Service that

operates on Realize and Pay basis. The Service is extended for both within and outside

network locations. All the benefits of other corp. clear services do come along with Corp

Collect Service.

Corp Comfort Services

Waiting unduly and without certainty as to realization of outstation cheques would hamper

the business cycles. With an assured credit on 8th day in respect of outstation cheques falling

outside network, CorpComfort Service proves an effective blend of CorpClear Service and

CorpInstant Service.

Corp Remit Services

CorpRemit Service meets the corporates wholesale payment requirements such as statutory

payments, payments to vendors/suppliers, banking requirements, inter branch transfers etc.,

Corporates need just to hand over the payout instructions file along with funding cheque to

CAPS branch. Further Servicing will be taken over by the CAPS outfit. One of the salient

features of CorpRemit is that corporates get confirmation on payout effected. Remittances

can also be sent through RTGS to over 25000 bank branches across the country.

Corp Pay Services

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Corp Pay Service facilitates corporates to make retail payments very effectively. Some of the

payouts that can be very effectively and conveniently handled include disbursal of incentives,

equity and debt servicing to the satisfaction of investors, salary and wages payouts etc. All

that corporate need to do is to furnish the payout details in magnetic media/mail and the

funding therefore. Rest is only client satisfaction. Value added service such as dispatch ofpayout instrument to beneficiary is also made available. All these are available at a very

competitive price exclusively for corporates.

Payment Processing Centre

Continuing the initiatives in re-engineering the Cash Management Process, Payment

Processing Centre was set up to replicate the success achieved in collections in payments too.

At PPC, capabilities are built to print exceptionally large number of Demand Drafts with

advice. Value added service such as dispatch of payout instruments to beneficiaries is being

undertaken.

PDC Hub

Considering the huge market available and market demand for collection of PDC cheques,

PDC Hub was setup exclusively for handling bulk PDC cheques received from Finance

Companies, Banks etc towards repayments loans extended by them.

CorpNet - an Internet banking facility

Symbolizing the commitment to deliver value added services to clients using CAPS with

continuous improvements year after year, the Bank has made the use of the state of the art

technology. CorpNet an internet banking facility is now available to all corporates using

CAPS for their cash management needs. CorpNet optimizes the efficiency of corporates cash

management. CorpNet provides for a host of advantages to corporates using CAPS.

Convenience, information online, data modulation, cash inflow forecast, outstanding position

of instruments sent for collection are some of these distinct advantages coming without any

extra cost. A very high level of security features are incorporated to afford greater degree of

client comfort using this technology driven value addition.

Correspondent Banking Arrangement

Corporation Bank has developed structured products exclusively to the agency services

requirements of clients of correspondent banks under the umbrella of Correspondent Banking

Arrangements. The product can be used by top rated corporate houses within the country for

effecting cash disbursal across country.

Speed Remittance:

Under this arrangement, the NRIs can send remittances through exchange houses across

globe. The exchange houses send the details to our Nodal branch (PPC Branch) at Bangalorewho in turn credit the same to the beneficiaries accounts maintained in any of our branches.

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In case the beneficiary account is not held in our Bank, a pay order can be issued at the

destination, which can be collected by the beneficiary.

Payment Gateway:

The Division, with futuristic view in mind where web trade is taking shape gradually in Indiaespecially amongst urban population, has decided to offer payment gateway solutions to

corporate having its own trading sites on Internet. The product envisages providing buyers

having account with our Bank an opportunity to pay for the purchases made on the net.

Through this product our corporate customer will get wider base for selling their products

ECS payments / Collections:

The product envisages large volume, low value bulk collections and payments from various

accounts at select ECS locations. The same can be handled through select specialized CAPS

branches.

Service charges:

Sl.No.

Type of Service Service Charges [Incl. ServiceTax]

3.01 Collection of Outward / Inward Cheques:Upto Rs. 10,000/-Rs.10,001/- to Rs.1,00,000/-Rs. 1,00,001/- and above

Rs. 55/- per instrumentRs. 110/- per instrumentRs. 165/- per instrument

3.02 Collection of Outward / Inward BillsUpto Rs.1000

Rs.1001 to Rs. 5000Rs.5001 to Rs.10,000

Rs. 50/-

Rs. 60/-Rs. 100/-

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Rs. 10,001 to Rs 50,000Rs. 50,000 to Rs 1,00,000> Rs. 1,00,000

Rs. 8.00/1000 [Min Rs. 100]Rs. 8.00/1000Rs. 8.00/1000 (Max Rs.17,000)

3.03 Return / Dishonour of Bills / Cheques

Cheques received in inward clearingFor Savings accountsFor Current, Overdraft & Cash Credit accountsCheques sent in outward clearing(Cheques deposited by customer)For Savings accountsFor Current, Overdraft & Cash Credit accountsDishonour of local / outstation bills and outstationcheques

Rs.100/-Rs.150/-

Rs.50/-per instrumentRs.100/- per instrument50% of collection charges(Min Rs.60)

4. CANARA BANK

CORPORATE CASH MANAGEMENT SERVICES (CCMS)

The speedier Corporates are, its easier for them to address the challenges of globalization.

Corporate Cash Management Services (CCMS), an innovative service offered by Canara

Bank for speedy collection of cheques and other instruments, places Corporates on a faster

track. In more ways than one-such as definite funds flow, better cash management and

deployment of funds, better monitoring of funds flow, optimum allocation of funds and

effective planning of investment functions.

WHAT IS CCMS:

An innovative service specifically tailored to meet the requirements of

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Corporates/Business houses/Partnership firms.

Speedy collection of outstation cheques and other instruments.

Pooling of funds at designated centers.

More importantly, providing funds to the Corporates as per their need.

Customized MIS reports.

WHAT CANARA OFFER:

Under CCMS they offer the state of the art technology products.

SUPERFAST SERVICE - Local cheque collection services

FASTRACK SERVICE - Upcountry cheque collection services

BULK COLLECTION SERVICE - Bulk cheques collection services

Under 'SUPERFAST SERVICE', agents or offices of Corporates can deposit the cheques to

be cleared in the local clearing and funds will be pooled at any pooling branch designated by

the Corporates.

Under 'FASTRACK SERVICE', agents or offices of Corporate can deposit the cheques drawn

on outstation centers and proceeds will be pooled at any pooling branch designated by

Corporate.

Under 'BULK COLLECTION SERVICE', agents or offices of Corporate can deposit their

bulk (large number) instruments of small value to be cleared in the local clearing and fundswill be pooled at any pooling branch designated by the Corporate.

Network of CCMS centres:






11. Goa: 3 12. Gujarat: 8



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Service Charges:

CHEQUE COLLECTION

5. Outstation

cheque collection

Inward / Outward Collection of Outstation cheques / instruments

such as DDs/ Dividend / Interest Warrants, Refund Orders, Income

Tax Refund orders etc. (other than bills)

Amount ranging

From - ToOTHER THAN INDIVIDUAL

INDIVIDUALS

OTHER THAN

RURALRURAL

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Up to Rs.

10000/-Rs. 50/- per instrument

Rs.10,001/- to

Rs. 1,00,000/-Rs. 100/- per instrument

Rs. 1,00,001

and aboveRs. 150/- per instrument

NEFT Money

transferInward = NIL

Outward : Upto Rs 1 lac- Rs 5/- per transactionAbove Rs 1 lac Rs 25/- per transaction

7. RTGS Moneytransfer

Inward = NIL Outward : Rs 1 lac to Rs 5 lac- Rs 25/- per transactionAbove Rs 5lac - Rs 50/- per transaction

SFMS (IFN

100)Inward = NIL

Outward Rs 1/- per Rs 1000/- or part there of subject to aminimum of Rs20/- and a maximum of rs 2000/-.

ECSCredit/Debit =

NIL

Immediate Credit of outstation cheques upto Rs.15000/-

5. Axis Bank:

Collection Solutions - Power Collect: Managing Receivables Collections

Axis Bank facilitates faster collections by enabling quick realization of local and upcountry

cheques and pooling the funds in a central account. The bank provides the following

collection products:

Local Cheque Collections (LCC)

Axis Bank locations:

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With a large network of branches, the bank is able to collect locally payable cheques across

the country. The branches are equipped to handle large volume of instruments and ensure that

the funds are pooled as per the agreed timelines even before the same are realized.

Non Axis Bank locations:

Currently the bank has Correspondent Banking arrangement with multiple Banks to use their

branch network. The bank has appointed our Coordinators at various locations to facilitate the

company cheque pick-ups and ensure that they are immediately processed in the local

clearing through a Correspondent Bank.

LCC enables the company to realize funds (on an assured day) through cheques payable

within the purview of local clearing. The bank provide these services at

Axis Bank Network: 426 locations with courier pickup facility

Coordinator Network: Locations with courier pickup facility can be added as per the

company business requirements

Upcountry Cheque Collection (UCC)

UCC enables the company an assured credit for outstation cheques on a designated day in any

of the company account across the country (at any of the Axis Bank branch) with a

customized MIS. In addition to Axis Bank and correspondent bank centers (3000 locations),

all the locations are being covered under Remote Cheque Collections, offering the company a

one-stop-solution for all the company outstation cheques across the country.

Axis Bank locations:

The Banks wide network of Branches ensures that most of the companys outstation cheques

would be covered within Axis Bank network. This would result in faster realization of funds.

Further, funds can be pooled into the company account even before the instruments are

realized as per the arrangement.

Non Axis Bank locations:

To further extend the offering to process the company Outstation Cheques at Non Axis Bank

locations, the bank have tied up with other banks to act as our Correspondent Bank and

ensure that all the company Outstation Cheques are collected and immediately presented for

clearing.

Remote Locations:

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There could be a possibility wherein the location where the outstation cheque is drawn on is

not covered under our extended network with correspondent banks. The bank still can offer

the company to collect the same and send it directly to the Drawee location for realization.

Bulk Collections - Utility Bills or PDCs Management:

The bank handle the complete life cycle of the Post Dated Cheques till they are realized. All

the activities like maintaining PDC inventories, retrieval and depositing the cheque for

payment, re-presentation of a bounced cheque and exception handling (stop payment etc.) are

conducted by the Bank on behalf of its customers.

At Axis Bank, the bank offer solutions to meet Bulk Collection Requirements ie, Post Dated

Cheques (PDCs), Bulk Collections through Cheque clearing or ECS debit services, etc. The

Bank processes collections in a convenient and efficient way to avoid any reconciliationissues. The bank have required infrastructure, technology and capability to manage and

handle PDCs through our dedicated team that manages inventory of cheques and timely

presentation of the same, well supported with MIS ensuring maximum benefits to the

organization

Utility bill collection:

Axis bank offers ease & convenience to its customers and utility subscribers in their bill

payment by facilitating bill payments via online & offline modes for various utility service

providers.

The various popular channels offered by Bank for bill payment are:

Online Mode:

Electronic Clearing Services (ECS)

Collection through Internet and ATM for common customers

Collection through Bill payment Kiosks

Offline Mode:

Drop boxes at branches of Axis bank/Departmental stores/Mobile Galleries

Onsite and Offsite ATMs

Pick up from customer service centers and other authorized outlets

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Presently the bank has tied up with utility service providers like MTNL, BPL Mobile,

AIRTEL, Reliance Energy, Mahan agar Gas, NDPL and more in the pipe line.

The Axis bank's extensive network & prominently placed ATMs provide reach and access for

customers to pay their bills. Bill payment service from Axis bank has a robust and proven

technology to ensure reliability, security and performance and is aptly supported by a

dedicated desk for efficient functioning and customer service..

Collecting Bankers for IPO or FPO or Rights Issues

As collecting bankers, the bank provides you services relating to:

Public or Rights Issues

Private Placements

Buyback offers

The bank provides Collecting or Escrow Banker services for Initial Public Offer (IPO) and

for Further Public Offer (FPO) to handle collections of application forms and instruments

received. Our extensive branch network of 236 locations, robust processes and systems and

an experienced team across the country enable us to act as a leading collecting banker. The

bank endeavors that Companies, Merchant Bankers, Registrars, and Syndicate Members

receive high quality service and satisfaction.

In this current scenario of cut-throat competition, Axis Bank has designed its products to

minimize the issues faced by you in the area of fund management and reconciliation. Our aim

is to reduce the cost, time and efforts faced by corporate in collection and payment issues.

The bank provide you complete solutions to all the company CMS needs to enable you to

devote more time and effort towards improving the company business

ECS Debit:

ECS Debit is an electronic clearing system that facilitates paperless debit transaction. Axis

Bank facilitates ECS Debit on all the locations that are activated by the respective localclearing houses. The bank accepts the electronic file centrally for all the locations and

arranges to upload it at the RBI site. The realized funds get pooled to a centralized account.

Network:

CMS Branch in States:




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45. Goa: 4 46. Gujarat: 39












Correspondent Bank Location: 825

RTGS &NEFT Locations: 187

Service Charges:

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6. HSBC BANK

Integrated Receivables Solutions (IRS)

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The bank understands how important accounts receivables management is to the company

business cycle. The more control you have over the company cash flow, the lesser will be the

need for working capital required for running the company business. The faster you convert

receivables into cash, the lower will be the risks associated with the company business. At the

same time, in today's competitive environment, this has to be matched with minimization oftransaction charges and must bring in efficiencies in the company business processes.

HSBC's Integrated Receivables Solutions (IRS) offers you an opportunity to outsource the

company receivables process, from picking up cheques from the company customers, usage

of strong logistics management and correspondent bank relationships for faster processing

and clearance of the company receivables to world-class systems and processes to allow you

to have a complete control over the company cash flows and receivables.

Benefits of Integrated Receivables Solutions (IRS)

Faster realization of receivables through our strong logistics management &

geographic reach

Savings in interest costs and Bank charges through rationalization of account structure

and local clearing at over 350 locations across the country

Simplification of process through Online querying on receivables

Simplification and automated Bank Reconciliation

Outsource debtor's reconciliation

The bank provide you with a single window for processing, tracking, reconciling and

managing all the company receivables - paper and electronic through our online delivery

platform HSBCnet

Key Features of HSBC's IRS:

Local clearing of cheques at over 350 locations across India

Faster realization of outstation cheques through correspondent banks with a strong

regional presence covering over 5,000 locations across India

Cheque pick-ups at over 350 locations directly from company's offices/customers

Single collection account for cheque deposits across the country

Cash concentration in the centralized collection account

Collection reports with details of cheque number, drawer's name, date and place ofdeposit and invoice details

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Online querying on instruments deposited across the country

One platform for all forms of collections i.e. cheques, cash and electronic Automated

Bank

Automated Reconciliation through integration of collection reports with the companyBack Office Systems

Reconciliation of invoices against receipts from the company customers

Products:

Paper Collection

IRS is structured to offer quick realization of the company instruments, local or outstation.

The proceeds of all cheques deposited with HSBC can be concentrated into a designated

central account at any of our branches. Consequently you have better control on the companycash flows and the reconciliation and monitoring requirements associated with multiple

accounts are eliminated. Information on these collections is delivered to you through

HSBCnet.

IRS further delivers a variety of collection reports that can be used for automating the

reconciliation process at the company end.

Local Clearing Solutions

HSBC has an extensive network of its own branches and correspondent banks thatprovide you with the capability to clear the company instruments in local clearing at over

350 locations across India. The funds collected from these instruments can directly be

credited to the company centralized collection account. At each of these locations, HSBC

provides you with the option of directly picking up the instruments from the company

customers. Detailed collection reports provide you with information on the instruments

deposited at each of the locations.

Outstation Clearing Solutions

HSBC has correspondent bank relationships with strong regional banks covering over

5,000 locations across India. This ensures faster realization of the company upcountry

instruments. Detailed collection reports and online querying options on HSBCnet ensure

that you can track and have complete control over the company receivables.

Smartcollect

Smartcollect provides you HSBC's extensive global reach of over 10,000 offices in 83

countries for efficient collection of foreign currency cheques.

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Electronic Collections

IRS helps the company business process improvement objectives with a comprehensive array

of electronic collections, including

Domestic electronic funds transfer such as RTGS, NEFT, ECS

International wire transfer

Direct debit

Receivables data accompanying these transactions is captured and delivered to you

electronically to support the company customer order fulfillment, credit management and

reconciliation process.

Receivables Management System

Built with advanced modular technology, our receivables management system brings together

all the IRS components. Its automated reconciliation and information management modules

are fully integrated with the collections and processing features of IRS. As the backbone of

IRS, our receivables management system:

Consolidates receivables information across electronic and paper collections

Automates accounts receivables reconciliation using the company pre-defined

matching parameters for funds received against various invoices

Delivers collection reports structured to meet the company specified needs

Provides online transaction enquiry

Integrated Payment Solutions (IPS)

Payments entail a broad spectrum of requirements, with constantly varying payment formats

and systems. While paper-based payments currently constitute a majority of payment modes

in the country, electronic-payments are fast gaining importance.

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Managing these constantly evolving and varied requirements, while seeking to effect the

company payments in a timely and accurate manner, is an administrative burden that the

company would like to do away with - but at the same time it would like to ensure that the

company internal guidelines and controls are in place.

Benefits of HSBC's integrated Payment Solutions (IPS)

Reduction in the overall end to end cost of processing payments and accounts

reconciliation

Enhanced reconciliation resource optimization in payments processing and account

reconciliations

Improved Risk Management and Controls

Improved vendor relationships

Key Features of HSBC's IPS

A single point of entry for real-time information & transaction - execution for all the

company accounts

Solution for online creation or file uploads of payment instructions for execution

through varied modes like Cheques, Drafts, RTGS, NEFT & Account Transfers

Options for instruction level or file level authorization or pre-authorized modes of

initiation

Flexible and scalable authorization matrix permitting multiple authorizing levels

Availability of varied Account Statements and Reverse MIS files for automated

reconciliation within the company systems

Safety and security through two-factor authentication

Industry benchmark security through 128 bit SSL encryption

HSBC IPS Products

Cheque Outsourcing Services

Cheque Outsourcing Services facilitates outsourcing of the company paper-based payment to

HSBC. The bank support individual/bulk issuance of payable at par company cheques,

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Demand Drafts and Cashier Orders. The bank manages the company paper-based payment

processing by providing solutions on:

Printing of instruments with customized payment advices

Online querying & reconciliation of instruments through varied reports

Outsourcing of instrument dispatches directly to the beneficiaries

Remote authorization of payments for the company mobile signatories

Rationalization of work flows and payment related activities

Priority Payments

Priority Payments is a suite of electronic payment products including NEFT & RTGS that

you may leverage on to pay the company beneficiaries in a timely fashion:

Reduction in cost of Demand Drafts Rationalization of courier lead time and expenses

Urgent payments at over 1000 RTGS locations and 700 NEFT locations

Reduction in the risk of fraudulent encashment associated with paper-based

instruments

Reduction in administrative activities like maintenance of dispatch records, cheques

etc

SmartCheque

SmartCheque is suited for the company low value, urgent paper payments: a solution, which

enables you to issue cheques at the company end which are payable at par at all HSBC

branches.

Advising Solution

In this, the bank intimates the company beneficiary of the payment and its underlying details.

In addition to the paper-advice that will accompany each payment instrument, our Advising

engine additionally provides:

Advice delivery to multiple recipients through email, fax or mail

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All payment types initiated through HSBCnet are supported

All payment types initiated through HSBCnet are supported Inter-account transfers,

Cashier Orders, Demand Drafts, Corporate Cheques, EFT, NEFT & RTGS

User defined templates for recipient information & advising details are supported

Service Charges:

Up-Country Cheque Collections within India:

Outstation Cheque Collection

(Charges applicable w.e.f. 1 Dec 2008 as per RBICircular dated 8 Oct 2008)

INR 50 per instrument (upto INR

10,000)INR 100 per instrument (INR 10,000

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(Charges exclusive of service tax) - INR 1 lakh)

INR 150 per instrument (greater than

INR 1 lakh)

Up-Country Cheque Collections outside India:

Foreign currency cheque clearance: 0.5% of the value of the cheque or Rs. 300 whichever is

higher

(Charges exclusive of service tax)

Others (Issuing a cheque in a country/location where HSBC has branches) 0.35% of the value

of the cheque or Rs. 50 whichever is higher

Others (Issuing a cheque in a country/location where HSBC has no branches) 0.40% of the

value of the cheque or Rs. 100 whichever is higher

Cash Delivery/Pick up: 250/ 225/200

Bill Payments:

Through Internet Banking and PhoneBanking: Free

RTGS (charges per transaction): Rs 1- 5 lacs: Rs 25


NEFT and EFT: Upto 1 lac: Rs 5 per transaction

Rs 1 lac and above: Rs 25 per transaction

7. Standard Chartered

Standard Chartered is highly recognized as a leading cash management supplier across the

emerging markets. Their Cash Management Services cover local and cross border Payments,

Collections, Information Management, Account Services and Liquidity Management for both

corporate and institutional customers. With Standard Chartered's Cash Management services,

the corporate will always know their exact financial position. The corporates have the

flexibility to manage their company's complete financial position directly from the computerworkstation. The corporates will also be able to take advantage of the banks outstanding

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and the ability to send industry standard messages directly to the bank. Their in-country

specialists are available to help customize a solution that would enable the corporate to

manage their working capital in a more efficient manner.

Collections Services

Comprehensive receivables management solution

Standard Chartered understands that operating and sustaining a profitable business these days

is extremely tough. In an environment of constant changes and uncertainties, most businesses

face challenges of costs and efficiency. Key concerns include:

Receivables Management - ensuring receivables are collected in an efficient and timely

manner to optimize utilization of funds.

Risk Management - ensuring effective management of debtors to eliminate risk of returns

and losses caused by defaulters and delayed payments.

Inventory Management - ensuring efficient and quick turnaround of inventory to

maximize returns.

Cost Management - reducing interest costs through optimal utilization of funds.

Solution:

The Standard Chartered Collections Solution leverages the Bank's extensive regional

knowledge and widespread branch network across their key markets to specially tailor

solutions for the customers regional and local collection needs. This Collections Solution,

delivered through a standardized international platform, has the flexibility to cater to the

customers local needs, thus enabling them to meet their objectives of reducing costs and

increasing efficiency and profitability through better receivables and risk management.

The key components of the banks solution include the following:

Extensive Clearing Network

Guaranteed Credit

Comprehensive MIS

System Integration

Outsourcing of Collection

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Extensive Clearing Network

The Banks extensive branch network, complemented by their correspondent banks' network,

provides the customers with a wide coverage of clearing locations to ensure they get the

benefit of early availability of funds. This is further enhanced by the customers cheque

purchase and guaranteed credit services.

Guaranteed Credit

To help the corporate manage their cash inflow fr

CMS Report 1

Documents

Transcript of CMS Report 1