E-PAYMENT

At DSCL

BY DHRUMEE PALAN

Preface
To survive, thrive and beat the competition in todays brutally competitive world one has to manage information and material flow in the organization and analysing them for monitory or non-monitory benefits of the organization. Banking System plays a significant role in the organization as the blood plays its role in the human body. It not only provides energy to the business but simultaneously it is essential for the success for the any business organization easily. Nowa-days, the major problem faced by every business organization is of finance because of drastic changes in the size and scale of business and increased competition, which results in the increase in credit business and shortage of financial brackets. In such an environment, the Banking System has occupied one of the key positions in the business management. In this regard, I have undergone my summer internship at Account & Finance Department at Manufacturing plant, Kota of DCM Shriram Consolidated Ltd. In our study, our main objective is to reflect our attention on that how we can reduce our Bank Charges in DSCL Ltd and discuss various types of bank charges in the company. The DSCL Ltd. is leading company in the field of fertilizer, Cement, PVC resigns & caustic soda. Our study discusses various aspects of the bank charges and effects thereof on ultimate performance of the company.

Certificate
This is to certify that MISS DHRUMEE PALAN have undergone through the Project BANKING SYSTEM which was assigned to him under the internship program from 10th of May to 10th of June. He has done work up to the said standards and has reported for the same.

Declaration
I hereby declare that this project has been prepared by me during the period 10th May, 2013 to 10th June, 2013 under the guidance of Mr Deepak Sabarwal, Mr K.K. Sharma and Mr Surendra DCM Shriram Consolidated Ltd., Kota. I further declare that this project report is prepared from the information collected from the company, the sources available from the Company and the same is purely for company benefits purpose. This project has not formed the basis for the award of any other degree/diploma of any University/Institution. We also hereby declare that all the information given in the report is true to my knowledge.

Place: Kota Date: 10th June, 2013 DCM SHRIRAM CONSOLIDED Ltd. (DHRUMEE PALAN)

ACKNOWLEDGEMENT
Sitting on the seashore we thought that it was an easy task to dive but it was only when we dived into the ocean of the project, we realized how much helpful were so many people to us. Without these people this exploration could never have been completed. It is a great pleasure for me to acknowledge the contribution & support of a large number of individuals of this effort. Above all, I bow my head before Almighty GOD without whose blessing my present project would not have existed and thanks for giving me patience and strength to overcome the difficulties, which crossed my way in the accomplishment of this endeavour. Further I would like to thank my parents who instilled confidence and moral support various stages during the course of this training. And also to Mr K.K.Sharma, Mr Deepak Sabarwal, Mr Surendra Gupta for their support. Finally, I would like to thank all those who have helped me directly or indirectly in completing the present study.

THANKING YOU (DHRUMEE PALAN)

Contents
COVER PAGE PREFACE CERTIFICATE DECLARATION ACKNOWLEDGEMENT CONTENTS CHAPTERS

Company Profile Effects of Economic Reform On Banking Chapter 3 Project Detail

RECOMMENDATION CONCLUSION BIBLIOGRAPHY

1. Company Profile
DSCL ORIGIN

The group began its operations with the setting up of Delhi cloth Mills (DCM) in 1889. Over the next 50 years the group emerged as one of the leading industry house of India. The wide business portfolio consisted of textiles, edible oils sugar, fertilizers, heavy chemicals, plastics, cement, rayon tyre cord, fine chemicals, energy, foundry and distillery. On 6th Feb 1989, DSCL was incorporated under the companies act, 1956, as a private ltd company under the name of DCM Engineering Industries Private Ltd. The Company became a Public Ltd Company on 18th September 1989 and the name of the Company was changed to DCM Industries Limited by an amendment made to the Certificate of Incorporation dated 1st March 1990. Again, the name of the Company was changed to its present name i.e. DCM Shriram Consolidated Ltd by an amendment made to the Certificate of Incorporation dated 20th July 1990. In 1990 to create more manageable business entities, DCM Ltd was restructured into 4 separate companies. DSCL took over 1/3rd of the business in cord sectors of the economy. the following business units became a part of DSCL: Shriram Fertilizers & Chemicals, Kota (Raj.) Shriram Cement Works, Kota (Raj.) Swatantra Bharat Mills, Delhi DCM Silk Mills, Delhi

Founded by Sir Shriram in 1889 as DCM Ltd, today DSCL is managed by Mr. Ajay S Shriram, Chairman & Senior Managing Director and Mr. Vikram S Shriram, Vice Chairman & Managing Director, the great grandsons of Lala Shriram, along with a highly professional executive team. They brought a new dynamism and a modern, professional outlook to the organization.

Companys Route 1889 Delhi Cloth Mills No. 1 1925 Delhi Cloth Mills No. 2 1928 Delhi Cloth Mills No. 3 1932 Daurala Confectionary Works

1935 Lyallpur cotton Mills, Lyallapur (Pakistan)

1938 Daurala Confectionary works 1940 Barhni Sugar Works (renamed as Mawana Sugar Works in 1949) 1941 DCM Chemical Works 1945 Daurala Distillery 1946 DCM Vanaspati Manufacturing World 1948 Swatantra Bharat Mills 1956 Hissar Textile Mills, DCM Silk Mills 1961 DCM Engineering & Development Works 1963 Rajasthan Vinyl & Chemicals Industries( renamed as Shriram Fertilizers & Chemicals) 1964 Rajasthan Rayons( renamed as Shriram Rayons) 1969 Fertilizer Plant 1987 Cement Plant( named as Shriram Cement Works) 2002 Shriram Polytech Ltd.

In the decade 1990-2000, DSCL added the following units to its portfolio: Shriram Alkali &Chemicals, Bharuch( Gujarat)- Chlor Alkali Shriram Environment & Allied Services, Gurgaon( Haryana)- Environment & allied services Ghaghara Sugar, Lakhimpur Kheri( U.P.)- Sugar Shriram Bioseed Ltd, Hyderabad (Andhra Pradesh)- Seeds DSCL ESCO Ltd, New Delhi- Energy Services Company.

Chronological history As far as in 1961 the fledgling beginning of one of the counrtys biggest chemicals complex took its root at kota by laying the foungation stone of Rajasthan Vinyl & Chemicals Industries which is presently known as Shriram Fertilizers & Chemicals. The company under the continuous dynamics expansion programmes diversified from chemicals to fertilizers & Cement. Cement plant is the 1st of its kind in the country and 2nd in the world because of its calcium hydroxide sludge based Technology instead of conventional lime stone raw material. The Chronological history of the growth is detailed below:
YEAR 1961 1963 1964 1967 1968 1969

1970

ACTIVITY The foundation stone was laid for the PVC group of plant. The caustic soda and calcium carbide plant were put on stream. The PVC plant was commissioned. The foundation stone was laid down for the fertilizer plant. Power plant of 35 MW commissioned. The fertilizers plant was put on stream with a production capacity of 700 tonnes per day. Caustic soda plant capacity increased to 50 TPD. Inauguration ceremony of the fertilizer complex by the former Prime Minister Smt. Indira Gandhi.

1976 1977

1978 1979 1981 1983 1985

1987

1989 1991 1993 1994 1997 1998 1999 SAP R/3 implemented successfully.

The capacity of fertilizer plant was increased to 930 TPD. The capacity of caustic soda was increased to 100 TPD. The caustic soda fusion plant was commissioned. Indias largest 20 MVA Indigenous Carbide Furnace was commissioned & the capacity of Calcium Carbide increased to 170 TPD. PVC plant capacity increased to 65 TPD. The capacity of PVC plant was established at 80 TPD. PVC plant capacity increased to 100 TPD. Power plant of 10 MW commissioned. Mercury Bearing Effluent Treatment plant commissioned. Purge gas recovery unit in ammonia plant commissioned. Cement plant of 600 TPD using Calcium Hydroxide waste from Carbide Plant was commissioned. Desorption unit for Ammonia recovery. Prill cooling system commissioned in Urea plant. ACPD system for energy conservation in Caustic Soda plant. Power plant of 30 MW commissioned. ISO 9000 to cement and compounding plant. Liquid Chlorine plant capacity was raised from 25 TPD to 75 TPD. Carbide packing plant was commissioned.

Executive summary
Ajay S Shriram Chairman & Senior Managing Director

Vikram S. Shriram Vice Chairman & Managing Director

Ajit S. Shriram Director (Sugar Business) S. D. Omchary Chief Executive Director (Textile/ Real Estate Development) Dr. G. C. Dutta Roy Chief Executive (Energy Business) S. Radhakrishna Executive Director (Sugar Business)

Rajeev Sinha Deputy Managing Director

S. K. Agrawal Senior Executive Director (Chemical Business)

K. K. Kaul Executive Director & Resident Head (Kota)

Board of Directors

Sn. 1 2 3 4 5 6 7 8 9 10

Name Shri Ajay S. Shriram Shri Vikram S. Shriram Shri Rajeev Sinha Shri Ajit S. Shriram Dr. S. S. Baijal Shri Arun Bharat Ram Shri Pradeep Dinodia Shri Vimal Bhandari Shri Sunil Kant Munjal Shri D. Sengupta

Designation Chairman & Senior Managing Director Vice Chairman & Managing Director Dy. Managing Director Director (Sugar) Director Director Director Director Director Director

11 12 13

Shri S. C.bhargava (LIC Nominee) Dr. N. J. Singh Shri S. N. Chaturvedi (UTI Nominee)

Director Director Director

About the Founder LALA SHRI RAM (1884-1963) Nothing can better sum up the homage paid to great son and philanthropist of Delhi, Barey Lalaji, Lala Shri Ram who began as a humble worker and went on to set up one of Indias largest business houses the DCM Group. Not only did Lalaji achieve great height in business enterprise; he also participated in full measure in the crucial early stages of nation building. Everyone is familiar with the name of multiple facets of the industries and institutions on which he left his imprint - be it the DCM Limited, Bengal Potteries, Jay Engineering Works, many sugar mills, Sindri Fertilizers, the Lady Shri Ram College, Delhi School of Economics and umpteen others.

Shri Ram was born to Madan Mohan Lal and his wife Chando Devi on April 27, 1884 into a family of Agarwal banias of modest means. Shri Ram, in the 79 years of his life, built an industrial empire manufacturing a vast variety of goods like - textiles, sugar, alcohol, heavy, chemicals, vanaspati, pottery, fans, sewing machines, electric motors and capacitors. The industrial legacy that he left behind was valued at INR 600 million at the time of his death.

Reared in milieu which grafts, nepotism, black marketing and tax evasion were considered a must for success in business, Shri Ram set for himself rigid standards of morality in his dealings with the public and

government and made no compromises in order to earn more money or gain a favour. While himself deprived of opportunities for higher education, he nevertheless understood how, important such education was in building the future of a nation. As a result he helped to finance a network of schools, colleges, industrial institutes and research laboratories. He was also the founder chairman of the Industrial Finance Corporation and Chairman of Sindri Fertilizers, the 1st national venture in the public sector in free India.

While Shriram lacked formal education, he read extensively. His reading included religious scriptures, Sanskrit classics, Urdu and Persian poetry and some English biographies. He assiduously cultivated men of learning and culture. But most of all he admired scientists on whom he pinned his hopes for the salvation of his country. One of his lovable eccentricities was that he carried out experiments to produce new varieties of food in his own room and then subjected his none too robust digestive system to his new recipes.

The secret of Shriram's enlightened approach to people of different faiths lay in his basic patriotism. He was an idealist who believed in raising India into an industrial nation. His love of India did not make him dislike or distrust Pakistan. Shri Ram had this uncanny ability to spot the Right Man for the Right Job a rare quality that contributed to his success. He made many mistakes in the choice of friends but seldom did he err in the selection of a business executive, a quality also inherited by his grandson Lala Bansidhar. Shri Ram's choice was not based on the scrutiny of a "Curriculum Vitae" but on an inborn gift, a sort of built-in Geiger-counter which ticked when he came across the man he was looking for.

He also was instrumental in setting up several prestigious institutions of higher learning and arts such as the Lady Shri Ram College and Delhi School of Economics, Shriram Center for Performing Arts etc.

The initials DCM went on to become known, not only in India, but also in Africa and Europe as well. Lalaji was knighted by the British Government 'for his distinguished career as an industrialist and philanthropist.

DSCL TODAY

Mission Building a world class organization Today DSCL, a Rs. 1900+ crore diversified business conglomerate based in North India, has a core sector business of Agri-business (Urea fertilizer, Sugar, Farm inputs marketing such as DAP, Pesticides, Seeds etc), Plastics (PVC and PVC compounds) & Chemicals (Chlor-Alkali, Water Treatment Chemicals, Environment Services, ChemSPARC). Other business interests comprise of Cement, Textiles, IT and Energy Services. DSCL also owns subsidiary companies - Gomti Sugar Limited a division of Ghaghara Sugar Limited (Sugar) and Shriram Polytech Limited (PVC profiles & products).

DSCL has strong brand equity reflective of credibility, ethical values and consistent high quality product image. Fostering enduring relationships is at the core of DSCLs business philosophy - with vendors, business partners, and customers and within the organisation between employees.

DSCL shares are listed and traded on both stock exchanges National Stock Exchange (NSE) and Mumbai Stock Exchanges (BSE). As a leading equal opportunity employer in India, DSCL has a motivated and dynamic management team of highly qualified professionals and dedicated workmen & staff whose work has shown the way towards creating Team Excellence. DSCL has a long history of accessing and employing the best technologies for its projects and has worked successfully with renowned international and domestic technology partners. As a learning organisation DSCL has worked regularly with the national and international consultants of repute, in diverse areas of Business Strategy, Quality, Organizational Development etc. In a major IT initiative the company has networked all its locations on a WideArea Network (WAN) and implemented SAP R/3 Enterprise Resource Package (ERP) across the Company. DSCL is in the completion process of upgrading and web-enabling its ERP to MySAP.com. Other key IT enabling initiatives under implementation are Customer Relationship Management (CRM) and Business Information Warehousing (BIW). All its main line locations/ products have ISO 9000 & 14000 certification. DSCL is currently implementing OHSAS 18000 system of Occupational Health and Safety in its facilities. In an increasingly global business environment, DSCL vision is to strengthen its commodity business while moving into value added & knowledge based products & services in the areas of its operations. Accordingly DSCL has set up DSCL ESCO Limited in the Energy Services Business with the objective of providing energy efficiency services and development of renewable energy. DSCL has also set up Shriram Environment and Allied Services (SEAS) to provide Environment Services. Amongst other initiatives DSCL has moved rapidly up the value chain in its core Agri-inputs, Plastics and Chemicals businesses.

DSCL strongly believes in socially responsible activity as a responsible Corporate Citizen. DSCL has made significant contribution to the society in the fields of Environment, Health Care, Family Planning, Education, Cultural Heritage, Rural Development and in promoting Sports.

SUBSIDARY COMPANIES DSCL has following subsidiaries namely: 1. DCM Shriram Credit and Investments Ltd. 2. DCM Shriram International Ltd. 3. DCM Shriram Aqua Foods Ltd. 4. DCM Shriram Infrastructure Ltd. 5. DSCL Energy Services Company Ltd. 6. Bioseed Research, Vietnam 7. Bioseed Genetics, Vietnam 8. Bioseed Research, Philippines 9. Bioseed Research India Pvt. Ltd. 10. Shriram Bioseed Genetics India Ltd. (51% stake) 11. Bioseeds Ltd. (51% stake)

PRODUCTS AND THEIR MANUFACTURING LOCATION

Location

Products

Kota (Rajasthan)

Fertilizers, Chlor alkali, Stable Bleaching Powder, Calcium Carbide, PVC resin, PVC compounds, Cement and PVC profiles.

Bharuch (Gujrat)

Chlor Alkali

Ajbapur (U.P.)

Sugar Sugar

Rupapur (U.P.)

Hyderabad (A.P.), Vietnam and Philippines

Hybrid Seeds

Gurgaon (Haryana)

Innovative Polymer Application Centre

Bhiwadi (Rajasthan)

Fenesta Window and Doors Systems

Tonk (Rajasthan)

Yarn

HONOURS AND AWARDS

DSCL has bagged several Awards in various fields: 1. National Safety Award in 1967. 2. First prize in All India Drama Competition continuously from 1979 to 1981. 3. Sports Championship in Rajasthan Welfare Tournaments in 1975 to 1987 & 1996. 4. First prize & Certificate of merit for Shriram Patrika. 5. 1973 to 1976 from Indian Association of Industrial Editors, Bombay and Magazine of the years and first prize in 1982 & 1983 from Association of Business Communication of India, Bombay. 6. Maximum capacity utilization, All India Award for fertilizer in productivity in 1982. 7. Runner up Trophy for BEST EFFICIENCY by fertilizers Association of India in 1984 and 1991. 8. Best Industrial Relations Award by Employers Association of Rajasthan in 1969. 9. National Productivity Award for Best Production in fertilizers from 1990 to 1992.

10. Pollution Control Award by Rajasthan State Productivity Council in 1990. 11. Pollution Control Award for Lime Stone Mines at Nimoda by Indian Bureau of Mines in 1991. 12. National Award for Public recognition of outstanding activity for prevention and control of pollution in 1992. 13. FAIs Award for Best Production performance of Nitrogenous fertilizer unit in 1993-1994 and Runner up in 1990-1991, 1995-1996. 14. NPC Award for Best Productivity Performance in fertilizer industry in 19931994 and second in 1996-1997. 15. Award for energy conservation in the chemicals sector in 1996. 16. Shriram Cement Nimoda mines won a number of prizes/ trophies in 10th mechanical pen Cost Mines Safety week in 1996. 17. SAP R-3/SAP Star Customer Award in 1998. 18. NCBM Award for Best improvement in Thermal Energy Performance in Cement Industry in 1999-2000. 19. National Award for Energy Efficiency SFC Kota and Bharuch in 2000-2001. 20. National Award for Oil Conservation SAC Bharuch in 2001-2002. 21. TERI Corporate Environment Award in 2001. 22. Centre for Science and Environment (CSE) Award: Green Rating Chlor Alkali Industry Unit SAC ranked 2nd in 2002-2003. 23. DSCL Won BEST EMPLOYER AWARD - 2007 From The Employers Association of Rajasthan. 24. DSCL Awarded by Five Star Rating system of British Safety Council London since 2005. 25. SWORD OF HONOUR AWARD 2008 and 2009

DIVERSIFIED BUSINESS SUGAR AGRIBUSINESS SEEDS HARYALI KISAN BAZAR CAUSTIC SODA & CHLORINE PVC RESINS CALCIUM CARBIDE CEMENT FENESTSA BUILDING SYSTEMS PVC COMPOUNDS DSCL SERVICES CO LTD TEXTILES

Effects of Economic Reforms on Banking

Banks in India have traditionally offered mass banking products. Due to Reserve Bank of India guidelines, Banks have had little to do besides accepting deposits at rates fixed by Reserve Bank of India and lend amount arrived by the formula stipulated by Reserve Bank of India at rates prescribed by the latter. PLR (Prime lending rate) was the benchmark for interest on the lending products. In view of several developments in the 1990s, the entire banking products structure has undergone a major change. As part of the economic reforms, banking industry has been deregulated and made competitive. New players have added to the competition. IT revolution has made it possible to provide ease and flexibility in operations to customers. Rapid strides in information technology have, in fact, redefined the role and structure of banking in India. Further, due to exposure to global trends after Information explosion led by Internet, customers - both Individuals and Corporates - are now demanding better services with more products from their banks. Financial market has turned into a buyer's market. Banks are also changing with time and are trying to become one-stop financial supermarkets. Market focus is shifting from mass banking products to class banking with introduction of value added and customized products. A few foreign & private sector banks have already introduced customized banking products like Investment Advisory Services, SGL II accounts, Photo-credit cards, Cash Management Services (CMS), Investment products and Tax Advisory services. A few banks have gone in to market mutual fund schemes. Eventually, the Banks plan to market bonds and debentures, when allowed. Banks also offer advisory services termed as 'private banking' - to "high relationship - value" clients. Some banks also structured their business as Strategic Business Units e.g. SBI has opened up Personal Banking Branch & Specialized Personal Banking Branches

THE NEW TECHNOLOGICAL PRODUCTS MICR CHEQUES As regards the design, development and implementation of critical payment system projects, Banks started MICR Cheques for faster settlement of funds. Extension of MICR-based clearing is facilitating faster clearing of cheques at more centres. The clearing cycle for local cheques is on T+1 or T+2 basis and for inter-city cheques on T+3 basis. Now Existing MICR centres would be converted into Cheque Truncation Based Clearing Centres. It would also introduce Cheque Truncation Based Inter-City Clearing paving the way for T+1 (or even T+0) cheque clearing for the whole country in coming years. India has introduced MICR processing in 40 places and another 14 are in the offing. With this about 70% of the countrys volume of cheques will stand MICRized. In order to introduce uniform standards for cheques and to facilitate cheque truncation nation-wide, the remaining small number of non-MICR cheques can be completely replaced with MICR cheques by March 2007. ONLINE BANKING The facility of Online Banking allows the user to access account information over a secure line, request cheque books and stop payment, and even transfer funds between bank accounts. Corporate are also deriving benefit from the increased variety of products and competition among the banks. Certificates of deposit, Commercial papers, NonConvertible Debentures (NCDs) that can be traded in the secondary market are gaining popularity. Recently, market has also seen major developments in treasury advisory services.

With the introduction of Rupee floating rates for deposits as well as advances, products like Interest Rate Swaps and Forward Rate agreements for foreign exchange, risk management products like Forward Contract, Option Contract and Currency Swap are offered by almost every authorized dealer bank in the market. The list is growing with various new technological products. REAL TIME GROSS SETTLEMENT (RTGS) RTGS is a payment system in which both processing and final settlement of fund transfer instructions take place on real time basis. It is a gross settlement system where fund-transfers are settled individually, i.e. without netting debits against credits. RTGS effects final settlement continuously and the settlements are immediate, final and irrevocable. Each Bank branch participating in the RTGS is identified by a unique Indian Financial System (IFSC) Code. With the advancement of the technological changes in the Banking Industry the RTGS introduction has become a boom in settling the Inter-bank funds instantaneously. The customer can avail this facility and make instantaneous transfer of funds to beneficiarys account. \ ECS (ELECTRONIC CLEARING SERVICES) ECS Credit Clearing ECS (Credit Clearing) is a mode of payment whereby an institution having to pay interest, dividend, salary, pension to a large number of investors/ share holders/ employees/ ex-employees can make the payments electronically instead of issuing paper warrants.

The Scheme benefits all concerned - to the corporate bodies (USERS) in not having to print and dispatch numerous paper instruments, to the banks (Sponsor Bank) in reconciling the figures, to the clearing system in not having to deal with paper instruments and to the beneficiary (share holders, depositors etc.) in getting the credit directly into their bank account on the due date. Difficulties in the existing system Bulk and repetitive payments like interest/dividend are mostly paper based involving printing of warrants (in costly MICR format), dispatching them by post (most often by Regd. post) and reconciliation thereof after payment by the agency banks. The difficulties are: reconciliation. bottlenecks and pressures on the cheque processing system. truments in transit and their fraudulent encashment. -receipt of the instrument and take efforts in depositing the instrument to the bank on receipt of the same. rge volume of instruments not only error prone and monotonous, but also a strain on the cheque clearing system. Benefit a corporate body / institution in this Scheme instruments in MICR format and dispatching them by Registered Post. eliminated. completed, the user institution gets an electronic data file from its bank with the date of payment and bankers confirmation thereon. made only on the specified date.

ECS Debit Clearing ECS (Debit Clearing) is a mode of payment whereby an institution receives payments from a large number of consumers/customers. ECS (Debit Clearing) envisages "a large number of debits and one credit". ECS (Debit Clearing) Scheme helps utility institutions, insurance companies, credit card companies and finance companies to collect the proceeds of telephone / electricity bills, insurance premia or periodical instalments etc. on the due date based on the mandates received from the consumers/ subscribers. Difficulties in the existing system As per the existing system for collection of electricity bills, telephone bills, Income Tax, Sales Tax etc., the customers/ subscribers are required to go to the collection centres/ designated banks and stand in long queues for payment of bills/dues. There would not be any cash transaction or payment through cheques in the new system. Benefits under ECS (Debit) Faster Collection of bills by the companies and better cash management by them. no need to stand in long queues for payment. mandates are given by the customers, to that effect cuts down the procedural delay. A company can receive submissions from various centres for collection having ECS (Debit) facility. There is no value limit for individual transactions.

ELECTRONIC FUNDS TRANSFER (EFT) SYSTEM It is an advance system of Mail Transfer or Telegraphic Transfer. It helps to transfer fund from one account to another with faster efficiency in less time and cost. At present all the 27 public sector banks and 64 other scheduled banks are participating in EFT system. EFT System is a remittance facility available among the 15 centres (viz., Ahmedabad, Bangalore, Bhubneshwar, Kolkata, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Kanpur, Mumbai, Nagpur, New Delhi, Patna and Thiruvananthpuram). Account holders at the branches of these participating banks can request for same day / next day delivery of funds to a beneficiary's account in any other branch of any bank at these centres. CASH MANAGEMENT SERVICE Cash Management is the stewardship or proper use of an entitys cash resources. It serves as the means to keep an organisation functioning by making the best use of cash or liquid resources of the organisation. At the same time the organisations have the responsibility to use timely, reliable and comprehensive financial information systems. Cash Management helps the organisation in:

sements. Today, large numbers of Cash Management Services (CMS) customers are satisfied with this facility, many of whom are in the top segment of the Indian Corporate and Public Sectors. This has been a result of a robust, end-to-end cash management product, which offers innovative and reliable solutions by combining an efficient Collections and Disbursements product, backed by state of the art systems to ensure customized delivery. The banks offer a wide range of CMS products covering Collections and Disbursements of operating flows, as well as specialized cash flow streams such as rights/public issue collections, dividends, interest/principal repayments, excise and sales tax payments etc.

Benefits to Corporate Managing outstation funds collections and payments can often be time consuming and expensive for multi-location organization. Delays of days or even weeks in realising outstation cheques, constant tracking and follow-up to transfer funds from outstation collection accounts, uncertainty and delays regarding information on the fate of cheques etc., are common. The other benefits of this product are:

Balance Sweep It means transfer of day-end-balances in collection accounts maintained at various centres across the country to the pooling account. Corporate can use the account for crediting local and outstation collections as well as for meeting payments and the residual balance at the end of the day swept to the main account.

Customized MIS at the local centre. -wise/ product-wise presentation/ credit/ returns reports provided to the Corporate Office through E-Mail. nightly/ monthly consolidated reports in soft-form, compatible with the clients accounting system, through E-Mail / Floppy / CDROM as required, for easier and speedier reconciliation. -Mail. PAYMENT SERVICES Banks are structuring a number of payment products to suit various needs of corporates such as Payable at Par Cheque Book. This product enables customer to issue local cheques at all bank branch locations through one cheque book thereby eliminating the hassles of obtaining demand drafts or opening current account at each location.

OTHER PRODUCTS FOR CORPORATE CLIENTS LETTER OF CREDIT (LC) Letter of Credit is a legal document issued by a buyers bank that upon presentation of required documents payment would be made. Usually confirmed by the seller's bank, protection is given to the seller that payment will be made if the goods are shipped correctly, and protection is given to the buyer that the goods will be shipped before payment is made. 'A letter of credit is a written commitment by a bank to make payment at sight of a defined amount of money to a beneficiary (exporter) according to the terms and conditions specified by the importer (applicant). The letter of credit should set a time limit for completion and specify which documents are needed to confirm the transaction's fulfilment.' Banks offer these services to corporate clients to enable machinery or material buying from foreign. Banks provide assurance to exporter about the amount on behalf of customer and ask for a nominal fee to issue such documents. Amendments in Letter of Credit are also allowed on request of customer on a nominal fee. LETTER OF CREDIT, CONFIRMED Letter of Credit, Confirmed is a letter of credit that is guaranteed by a bank that is acceptable to a seller (usually a local bank), regardless of buyer bank. LETTER OF CREDIT, IRREVOCABLE Letter of Credit, Irrevocable is a letter of credit where payment is guaranteed as long as the seller meets all conditions stipulated. A revocable letter of credit can be cancelled or altered by the buyer without permission of the seller.

FUNCTIONS OF FINANCE AND ACCOUNTS DEPARTMENT

Before starting the project I would like to tell something about the functional work of my department. I observed and found out some functions of Account & Finance (A & F) department during the internship. These functions are divided into various sections for easy performance. So, there are various sections in DSCL, Kota to complete all the tasks i.e. Payroll, Accounts & Finance, Costing & MIS, Old Records.

STATUTORY COMPLIANCE Conducting of Financial, Cost and tax audit. Compliance of Sales tax, Income Tax, Excise and Bonus act requirements. Timely payment of statutory dues such as Tax and duties etc.

CASH MANAGEMENT Liaison and submitting information to bank for working capital. Cash Flow monitoring. Receipt/ Payment of Cash/Cheques/Drafts. Payment to Suppliers/Contract/Transporters ACCOUNTS CLOSING ACTIVITIES Coordination and timely closing of books of accounts Monthly/Quarterly/Half yearly/Mid-term/Annual. Timely compilation/Analysis and submission of monthly MIS to Corporate Office/SBUs.

EMPLOYEES PAYMENT/ SERVICES Timely payroll processing and other perks. Timely providing tax calculation and TDS certificate.

Working Capital Working capital typically means the firms holding of current or short -term assets such as cash, receivables, inventory and marketable securities. These items are also referred to as circulating capital Corporate executives devote a considerable amount of attention to the management of working capital. Definition of Working Capital Working Capital refers to that part of the firms capital, which is required for financing short-term or current assets such a cash marketable securities, debtors and inventories. Funds thus, invested in current assets keep revolving fast and are constantly converted into cash and this cash flow out again in exchange for other current assets. Working Capital is also known as revolving or circulating capital or short-term capital. Excess of current assets over current liabilities are called the net working capital or net current assets. Working capital is really what a part of long term finance is locked in and used for supporting current activities.

 The balance sheet definition of working capital is meaningful only as an indication of the firms current solvency in repaying its creditors. When firms speak of shortage of working capital they in fact possibly imply scarcity of cash resources. A companys operating cycle typically consists of three primary activities: Purchasing resources, Producing the product and Distributing (selling) the product. These activities create funds flows that are both unsynchronized and uncertain. Unsynchronized because cash disbursements (for example, payments for resource purchases) usually take place before cash receipts (for example collection of receivables). They are uncertain because future sales and costs, which generate the respective receipts and disbursements, cannot be forecasted with complete accuracy. The firm has to maintain cash balance to pay the bills as they come due. In addition, the company must invest in inventories to fill customer orders promptly. And finally, the company invests in accounts receivable to extend credit to customers. Operating cycle is equal to the length of inventory and receivable conversion periods. FACTORS DETERMINING WORKING CAPITAL 1. 2. 3. 4. 5. 6. Nature of the Industry Demand of Industry Cash requirements Nature of the Business Manufacturing time Volume of Sales

7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21.

Terms of Purchase and Sales Inventory Turnover Business Turnover Business Cycle Current Assets requirements Production Cycle Credit control Inflation or Price level changes Profit planning and control Repayment ability Cash reserves Operation efficiency Change in Technology Firms finance and dividend policy Attitude towards Risk

Disadvantages of Redundant or Excess Working Capital Idle funds, non-profitable for business, poor ROI Unnecessary purchasing & accumulation of inventories over required level Excessive debtors and defective credit policy, higher incidence of B/D. Overall inefficiency in the organization. When there is excessive working capital, Credit worthiness suffers Due to low rate of return on investments, the market value of shares may fall Disadvantages or Dangers of Inadequate or Short Working Capital cant pay off its short-term liabilities in time. Economies of scale are not possible. Difficult for the firm to exploit favorable market situations Day-to-day liquidity worsens Improper utilization the fixed assets and ROA/ROI falls sharply

Forecasting or estimation of working capital requirements Factors to be considered Total costs incurred on materials, wages and overheads The length of time for which raw materials remain in stores before they are issued to production. The length of the production cycle or WIP, i.e., the time taken for conversion of RM into FG. The length of the Sales Cycle during which FG are to be kept waiting for sales. The average period of credit allowed to customers. The amount of cash required to pay day-to-day expenses of the business. The amount of cash required for advance payments if any. The average period of credit to be allowed by suppliers. Time lag in the payment of wages and other overheads

After deciding the working capital if funds fall short then more funds are asked form Delhi office. After receiving adequate amount of funds the funds are then respectively allocated to pay bills, taxes, custom duty etc.
The payment is made using new technological products such as RTGS and NEFT. NEFT and RTGS are two main mechanisms to transfer money from one bank to another bank in India. Transferring money between two accounts in same bank is pretty straight forword and its a internal matter of the bank, it does not have to deal with other banks and their protocols, however when one bank wants to send the money to another bank in India, there is a defined mechanism it has to be done and hence NEFT and RTGS comes into picture. Both these systems are maintained by Reserve Bank of India.

NEFT National Electronic Fund Transfer NEFT full form is National Electronic Fund Transfer, and its a system of transfer between two banks on net settlement basis. Which means that each individual transfer from one account to another account is not settled or processed at that same moment, its done in batches . A lot of transactions are settled in one go in each batches. Presently, NEFT services are available from 8:00 am to 6:30 pm on weekdays (Mon Fri) and from 8:00 am 12:30 pm on Saturday. Any NEFT Transfer done between 8 am 5 pm generally gets settled on the same day, but if you deposit the money after 5 pm, then that will be settled the next working day. In case of Saturday, any money deposited between 8 am 12 noon can be expected to reach the beneficiary account the same day. NEFT Transfer Example For example lets say Ajay has ICICI Bank account and Robert has a bank account in HDFC bank , Now Ajay deposits Rs 10,000 in Vijay account through NEFT transfer at 10:30 am . The money will be then taken out from Ajays ICICI Account and will be sent to Vijays HDFC bank the same day, then HDFC bank will credit Vijays bank account. In case money can not be transferred to the target account (beneficiary account) , the money will be credited back to the source branch within 2 hours of the batch in which it was processed. RTGS Real Time Gross Settlement RTGS full form is Real Time Gross Settlement and its a system of money transfer between two banks in real time basis, which means the moment one bank account transfer the money to another bank account, its settled at that time itself on real time basis between the banks, but the beneficiary bank has to make the final settlement to the bank account within two hours of getting the money. RTGS is the fastest possible money transfer between two banks in India through a secure channel.

Let me give an example, lets say Ajay has a SBI Bank account and Vijay has an Axis Bank account, Ajay transfers Rs 5 lacs to Vijays account through RTGS transfer, SBI bank instantly transfers Rs 5 lac to Axis Bank, now Axis bank has 2 more hours to deposit it in Vijays account . Hence in worst case even with RTGS transfer there can be delay of 2 hours.

NEFT and RTGS Charges NEFT and RTGS transfer charges depends on the Bank. RBI has guidelines for the maximum fees which can be charged, but it finally depends on the bank in question. Note that NEFT and RTGS charges, varies depending on the amount transferred and the timings when its done. While NEFT charges depends purely on the amount transfered, RTGS charges depends on the amount transferred as well as the timings of the day when its done . A RTGS transfer early will cost a little less charges. Note that, Service tax is also applicable to the charges. Below are the charges shows for NEFT and RTGS for retail banking (not for institutional

banking)

Information required to make an RTGS & NEFT payment? For making a payment through NEFT/RTGS, following information has to be furnished.

Amount to be remitted Remitting customers account number which is to be debited. Name of the beneficiary bank. Name of the beneficiary. Account number of the beneficiary. IFSC code of the destination bank branch

Note: MICR code is generally not required for NEFT or RTGS transfer.

Difference between NEFT and RTGS Finally let me list down all the differences between NEFT and RTGS in a table, so its easy for you to understand the conclude finally. Criteria Settlement Full Form Timings on Mon Fri Timings on Saturday NEFT Done in batches (Slower) National Electronic Fund Transfer 8:00 am 6:30 pm 8:00 am 12:30 pm RTGS (Retail) Real time (Faster) Real Time Gross Settlement 9:00 am 4:30 pm 9:00 am 1:30 pm 2 lacs No Limit Real time between Banks Rs 25-30 (Upto 2 5 lacs) Rs 50-55 (Above 5 lacs) (Lower charges for first half of day) Large Money Transfer

Minimum amount of money No Minimum transfer limit Maximum amount of money No Limit transfer limit When does the Credit Happen in beneficiary account Happens in the hourly batch Between Banks Upto 10,000 Rs 2.5 from 10,001 1 lac Rs 5 from 1 2 lacs Rs 15 Above 2 lacs Rs 25 Small Money Transfer

Maximum Charges as per RBI

Suitable for

Payment process using RTGS and NEFT and SAP Assortment of Bills After the invoice verification process, all the invoices arrive in the finance section. There is a cabinet here which houses several compartments, one for each category of bills. These categories are: Outside Supplier Local Supplier Raw Material Due Date Transporter Contractor Employees Misc. Bills SGFL Down Payment Requests The person bringing the bills from Invoice verification section places the bills in their respective category compartment in the cabinet. All of the above mentioned categories are self-explanatory except, may be, for Due date. Due date category compartment contains bills that have a fixed due date of payment. At the end of each day a person from finance section picks out the bills from all the compartments and separates those with a due date. Then, these bills with due date are sorted based on the date and put into due date compartment. Further these due date bills are divided into two categories viz. bills that can be paid online and others for which payment is made through cheques. Payment of Bills Each category of bills has a particular payment cycle. In other words there are fixed intervals set for each category of bills on at which the payment is made. For example Transporter bills are paid on every Friday. The complete list is given below:

Category Local Suppliers (Kota) Transporters

Intervals Thursday 6th, 13th, 21st & 29th of each month 5th, 12th, 19th & 26th of each month Daily Daily As per requirement

Contractors Outside Kota Suppliers Raw Materials Miscellaneous

Apart from the bills, some statutory payments (taxes) have to be made. Their due dates are given below:
Category TDS/TCS VAT/CST Service Tax/Excise Duty EPF & OPF WCT ESI Custom Duty Intervals 7th 14TH 6th 15th 15th 21st As per need

Steps in Payment Process To start the payment process, first all the vouchers are arranged in the ascending order of vendor code. Vouchers are entered on SAP using the code F110. After running F110 code following screen appears:

1. 2.

Run Date Identification

Payment date / Current date Serial no. e.g. 001 for 1st proposal of the day

After filling above mentioned fields, click on Parameters. Following screen appears: 3. Posting Date / Docs entered upto is the date current date

4. 5.

Customer items due by Company Code

Mention current date 1000 in case of payment for SFC 5600 in case of payment for SGFL

6.

Pmt meths

RTCN-

RTGS Transfer Cheques NEFT

7. 8.

Next p/date Vendor

Mention current date+1 Fill vendor codes from Vouchers (In case of Transporter / Local Suppliers & Contractors payment for all vendors are processed & input vendor from 000000 to ZZZZZZ)

After this, click on Print/Data Medium. Following screen will appear:

10

RFFOUS_T

Choose from the following:HDFCK-EP-NEFT HDFC KOTA-E-Payment

For NEFT (NEFT) RTGS (RTGS) TRFD A/c transfer) Cheques Cheques

HDFCK-EP-RTGS

HDFC KOTA - E-Payment

HDFCK-EP-TRFD

HDFC KOTA-E- Payment (A/c

HDFCK-EP

HDFC-KOTA-E-Payment-

After this, click on Free Selection and following screen will appear: Now enter the values in Business Area and Release Group field and save the file. Then, go back to the main menu.

Click on Proposal and enter value in the Start Date field and check the Start Immediately box. Following screen will appear:

Then check the document no. and amount and if in single vendor more than one document is there then DOUBLE CLICK that vendor and following screen appears after checking the same save the file and return to previous menu.

Click on RUN Payment. Schedule payment screen 2 Click on Status Again Print out menu: Job Name: Start immediately F110-20090721-SKG01-?

ENTER.

Change the serial no. where the question mark (?) appears this is done to create the payment document by the SAP system)

Click on Pmnt Run box for generating bank documents & cheque list for checking of original invoice bill then final payment approval. List generated from T code SP02.

Now, to process the file and uploading on the bank site we have to run New Session Transaction Code ZHDFC. Following screen will appear:

Click on this box to generate the file in the system for uploading on Banks web-site.

Following screen will appear.

Type the current date

Click on the drop down list and then select the file that is created. And then EXECUTE

After executing it gives information-(HDFCBANK RFC Destination not provided)-Press Enter

It gives this information and then we press enter.

Fill in the required fields and now the file is ready for uploading on banks website.

Now, go to the banks web-site and upload the file. On HDFC Banks web-site, following page will be displayed:

Open HDFC bank site Wholesale banking e-payment continue - yes.

Fill in the Login ID, Login password and domain and then press Login tab. Choose the digital certificate and press OK. In the next screen shown below click on Cash management service

After clicking Cash management service-disbursement-upload following screen appears

Click on it to select the file for uploading

After uploading to check that file is uploaded or not we check by clicking it.

Process for Down payment Request (Transaction Code F-48) Document Date Voucher date Posting Date current date (appears automatically) Type BV ( used for bank vouchers) Reference PO No. Vendor Type vendor code Special GL A ( Special GL indicator for advance) 7) Bank Account No. GL of bank i.e. HDFC ( 45501106) or 8) Business area 9) Amount 10) Text 11) Click on Request 1) 2) 3) 4) 5) 6)

After filling all the details as mentioned above click on save. This will create the payment document in the SAP system. This means now document is ready to create a Cheque.

In case where expenses has to be booked and cheque is to be made then one has to fill the basic data debit the expenses GL posting key being 40, write the cost centre and credit the bank GL through which payment is to be made (45501106 for HDFC, 45509111 for ICICI, 33030411 for PNB and 33030420 for SBI) posting key being 50.

Simulate the document and click on save. By this document will get created. Transaction Code FCH5 For Creation of manual Cheque Following screen appears when from Transaction Code FCH5

Payment Document No. Paying Company Code Fiscal Year House Bank Account ID Cheque No. printed. And then press Enter -

Document No. for which cheque is to be created. 1000 (for SFC) or 5600 (for SGFL) Current running year HDFCK / BORK / PNBK / SBIK HDFCKI / BORKI / PNBKI / SBIKI Cheque No. on which the cheque detail is to be

Fill in the Payee Name as the name of the party on whose name the cheque is to be printed. Similarly fill in the City and country as IN and then Save. Transaction code ZFMC (For printing of Cheque after creating it through FCH5)

House Bank Account ID Cheque No. FCH5. Then EXECUTE

HDFCK / BORK / PNBK / SBIK HDFCKI / BORKI / PNBKI / SBIKI Cheque No. that was assigned for the document through

In creating Cheque from other banks i.e SBI, BOR and PNB through APP Process for cheque cancellation:-

For chqeue cancellation T code FCHG is used and filled desired information as mention below then excute.

Tcode FCH9 is used for void the cheque For chqeue void the T code FCH9 is used and filled desired information as mention below then excute

Process for updating assisgement filed :- Assisgement filed of SAP document is represent basically cheque no./UTR no. of bank payment.

For upading this first we have open HDFC bank site

Payment type DCKV702 001 select then view

then click reverse file download and then save the same in desktop by given file name DCKV01.

Open SAP using T Code ZHDFC_REVERSE then execute

after execute file open

then click Transfer

Then continuous > enter button finished all line item.

Project Profile

The title of the project is on payment and receipts of DSCL

Objectives of the Project

To find out the cheque cost unnecessarily being paid by the company To find out better alternative methods of payment at minimum cost To study the concept of payment in DSCL To make a comparative analysis of different mode of payments To estimate the cost which can be reduced through opting other alternatives.

Scope of project
the scope of the study is extended to the assessment of the DSCL business transactions with the suppliers. The study will help in resolving the unnecessary cost incurred by the company and reducing the cost of transactions. It will also help us to find out the area where the company is paying money its not suppose to pay.this project is mainly for the remittance services by banks. This is specifically for the company and cannot be generalized because of the customized details. The data being used is of 2012-13. Evaluation process can help in formulating the financial policies and studies the different alternatives sources, as it reveals the reduction in cost to the company.

Significance of Project
This project will save time and effort Cost of payment n receipts will be reduced Problem of cheques misplacement can be reduced Cost of manpower can be reduced Provide better alternatives to make payments

Assumptions
The data collected is 100%correct as no personal prejudices are assumed to be involved. The bank charges are taken to be 4Rs. for outstation cheques and 0.05Rs for local cheques

Data of collection for the year 2012-13 is collected and is summarized in the following tables: Table 1 indicating the amount received by the firm for the year 201213in form of local and outstation cheques Table 2 indicates the charges to be paid by the firm to banks for outstation and local cheques taking that bank charge 4Rs. per 1000 for outstation cheques and 0.05Rs. Per 1000 for local cheques.

Sum of inst_amt Month TYPE 1 Local Ostn 1 Total 2 Local Ostn 2 Total 3 Local Ostn 3 Total 4 Local Ostn 4 Total 5 Local Ostn 5 Total 6 Local Ostn 6 Total 7 Local Ostn 7 Total 8 Local Ostn 8 Total 9 Local Ostn 9 Total 10 Local Ostn 10 Total 11 Local Ostn 11 Total (blank) (blank) (blank) Total Grand Total

Total 137569026 23125335 160694361 198841401.4 41267292 240108693.4 318330268.3 58134152 376464420.3 464504198.6 44673415 509177613.6 429657015.9 52580692 482237707.9 200460593.9 27934280 228394873.9 337176475.1 57315816 394492291.1 233983156.8 26552522 260535678.8 358636885.4 38516358 397153243.4 324753978.6 31806180 356560158.6 285714283.6 28483025 314197308.6

3720016351

Sum of interest Month TYPE 1 Local Ostn 1 Total 2 Local Ostn 2 Total 3 Local Ostn 3 Total 4 Local Ostn 4 Total 5 Local Ostn 5 Total 6 Local Ostn 6 Total 7 Local Ostn 7 Total 8 Local Ostn 8 Total 9 Local Ostn 9 Total 10 Local Ostn 10 Total 11 Local Ostn 11 Total (blank) (blank) (blank) Total Grand Total

Total 6878.45 92501.34 99377.79 9942.07 165069.17 175011.24 15916.51 232536.61 248453.12 23225.21 178693.66 201918.87 21482.85 2629.03 24111.88 10023.03 111737.12 121760.15 16858.82 229263.26 246122.08 1169915.78 106210.08 1276125.86 17931.84 154065.43 171997.27 16237.69 127224.72 143462.41 14285.71 113932.1 128217.81

2836558.48

Summary of the findings

The company receives cores of rupees per month in form of local and outstation cheques and per month the company pays hunderds and thousands of rupees as rate of bank charges. For the fiscal year 12-13 the company paid a total of Rs.2836558.48

Recommendations
1. Company should ask its customers those who pay using outstation cheques to pay through local cheques. 2. Those who pay using local cheques can pay through RTGS and NEFT. 3. Customers can also go for bank to bank transfer (possible for those who have accounts in same banks) 4. Therefore the company could ask its customers to open their accounts in HDFC

Conclusion
From the analysis done its clear that in this competitive era of all types of business. To survive in the corporate each has to be competitive and provide services and products in lesser cost with better and quality which provides hassle free work to the user. In the analysis I found out that due to lack of awareness and volatile market, company needs to reanalyze its policies time to time so that it can reduce its cost of cheque payment system. Like the company has identified the new products in banking services to improve its efficiency like RTGS, NEFT etc it should recommend it to its customers too.

BIBLIOGRAPHY
Online Information 1. www.dscl.com 2. www.indiainfoline.com 3. www.banknetindia.com Banks Website-HDFC www.hdfc.com