PRESTIGE INSTITUTE OF MANAGEMENT AND

RESEARCH, INDORE
(An Autonomous Institution Established in 1994, Accredited with Grade ‘A++’
NAAC(UGC) ISO 9001: 2008 Certified Institute, AICTE / UGC Approved Programs
affiliated to DAVV, Indore)

Session: 2020-2022
Banking Service and Management
“A comparative study on Current account of
SBI bank and ICICI bank”

Submitted To: Submitted By:

Dr. Shailendra Gangrade Anmol Goyal
Sakshi Garg
MBA FT 3 B

CONTENTS
S.NO. TOPICS PAGE NO.

1 Introduction 1

2 Conceptual Framework of the Topic 2-6

3 Bank Profile 7-10

4 Reason for selecting the Topic 11

5 Observation of Topic 12

Facts Analyzed after visit to the 12

6
bank

7 Comparison from Opted Bank 13-15

8 Conclusion 16
 INTRODUCTION

State Bank of India (SBI) is India’s largest state-owned public sector banking company. This
bank has played a vital role in establishing the regulated banking sector in India as it offers a
vast network of current account banking products and services to individuals as well as
businesses.

A current account is a type of demand deposit account which provides unlimited transactions
depending upon the balance maintained in the account. A current account can be opened by
entrepreneurs and professionals who deal with large transactions on a regular basis. In this
article, we review the types of SBI current account that can be opened by business individuals
in detail.

The Current Account product provides a range of services like Anywhere Banking in India (also
anywhere in the world), which enables the customer to operate from any branch, provides for faster
collection of upcountry cheques, doorstep banking which provides for delivery and pick-up of cash
and documents, Internet Banking which enables online tracking of the account, execution of
transactions and so on. Multiple variants of Current Accounts are offered by ICICI Bank to suit your
specific requirements.

A Current Account is a type of bank account that is used by businesses and has been designed
to promote businesses of various sizes. This is especially true in the case where the
transactions are numerous during one working day. Where a savings account is primarily
aimed at an individual account holders’ savings and investments, a Current Account retains
the same purpose but is aimed at promoting businesses.

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 CONCEPTUAL FRAMEWORK OF THE TOPIC

Current bank account is opened by businessmen who have a higher number of regular
transactions with the bank. It includes deposits, withdrawals, and contra transactions. It is
also known as Demand Deposit Account.

Current account can be opened in co-operative bank and commercial bank. In current
account, amount can be deposited and withdrawn at any time without giving any notice. It is
also suitable for making payments to creditors by using cheques. Cheques received from
customers can be deposited in this account for collection. They are interest-free accounts
which are favourably recommended for those customers who run a small or medium business
and require a continual service for banking transactions. However, these accounts require a
minimum balance to be operated. There are no limitations on the number of transactions
carried out per day.

FEATURES OF CURRENT BANK ACCOUNT

The main features of current account are as follows: -

 Current bank accounts are operated to run a business.

 It is a non-interest-bearing bank account.
 It needs a higher minimum balance to be maintained as compared to the savings
account.
 Penalty is charged if minimum balance is not maintained in the current account.
 It charges interest on the short-term funds borrowed from the bank.
 It is of a continuing nature as there is no fixed period to hold a current account.
 It does not promote saving habits with its account holders.
 Banker requires KYC (Know your customers) norms to be completed before opening
a current account.
 The main objective of current bank account is to enable the businessmen to conduct
their business transactions smoothly.
 There is no restriction on the number and number of deposits.
 There is also no restriction on the number and number of withdrawals made, as long
as the current account holder has funds in his bank account.

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  Generally, bank does not pay any interest on current account. Nowadays, some banks
do pay interest on current accounts.

TYPES OF CURRENT ACCOUNTS

 Premium Current Account

As the name says, it comes with tailor made features, exclusive for the accountholder,
and is crafted to suit an array of transactions. This is suited best for the ones who are
planning to perform high level financial transactions.

 Standard Current Account:

This is a basic deposit account, also non-interest bearing that comes with certain
mandations: a minimum average amount that needs to be maintained on a monthly
basis being one of them. It also offers standard procedures like internet and SMS
banking, along with free-of-charge NEFT and RTGS transactions.

 Foreign Currency Account:

As the name suggests, if you have a business that entails sending or receiving money
in foreign currencies, this account is the best bet. This type of Current Account is
primarily for those businesses who require the assistance for outward or inward
remittances in foreign currencies daily. The basics of the account functionality remain
the same.

 Packaged Current Account:

This one is better than a standard account and a little down the rung as compared to a
premium account. It provides quite a decent amount of benefits along with features
such as travel insurance, accident insurance, etc.

 Single Column Cash Book

If you hold a business without maintaining a bank account, this one is the best deal.
While it will not provide any features, it enables easy simple day-to-day transactions,

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 which are all listed under separate columns, namely debit and credit. This account
does not provide any feature such as an overdraft facility but enables you to monitor
and maintain your daily transactions via two separate columns of debit and credit of
finances.

ELGIBILITY CRITERIA

All individuals possessing acceptable KYC documents are eligible to open a current account
at a bank. One can approach any bank with the requisite documents to open a current account.
Current account holders are required to maintain minimum monthly average balance (MAB)
in their account, failing of which they can attract penalty. Following is the eligibility criteria
that individuals need to fulfil to open a current account in India:

 Sole Proprietor
 Partnership Firms
 Limited Companies
 Societies / Clubs / Associates
 Hindu Undivided Family (HUF)
 Trusts
 Individual
 Executors, Administrators and Liquidators

STEPS TO OPEN A CURRENT ACCOUNT ONLINE

A current account can be opened in any commercial or non-commercial bank. The customer
needs to visit the nearest bank branch will all the required KYC applicable documents. All
these documents need to be submitted along with the application form. Account holders can
opt to open a current account online as well as offline.

Step 1: Visit the official bank’s website in which the customer wishes to open an account.

Step 2: Go to the online Current Account opening form.

Step 3: Fill all the required details in the ‘Personal Details’ & ‘Account Details’ section.

Step 4: Download the filled Current Account opening online form and take a printout.

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Step 5: Visit the nearest bank branch along with the filled form and the required KYC
acceptable documents required to open Current Account.

One can also visit the nearest bank branch along with all the documents and fill out the
application form offline. It is to be noted that the steps may vary from one bank to another.
The list of documents varies in accordance with the chosen account type.

DOCUMENTS REQUIRED

Below mentioned is the list of KYC documents (proof of name, address, and activity of the
concern) required for Current Account opening. However, the current account opening
documents may vary from one bank to another, and the type of account chosen.

 PAN Card
 Partnership Deed (in case of Partnership Firm)
 Certificate of Incorporation, MOA & AOA (in case of Companies)
 Certificate by Sales Tax or Service Tax authorities (in case of Proprietorship Firm)
 Address Proof of the Firm / Company / HUF
 ID Proof and Address Proof of all directors / partners
 A cheque for opening bank account
 Photograph

Any one of the below mentioned list ID and Address proof needs to be submitted along with the
current account opening form:

ID AND SIGNATURE PROOF

 Passport
 PAN Card
 Driving License
 Voter ID Card
 Aadhaar Card
 Employee Identity Card (in case of government employees)

ADDRESS PROOF

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  Rent Agreement
 Bank Statement
 Voter ID Card
 Ration Card
 Passport
 Driving License
 Utility Bills (water, electricity etc.)

HOW TO MAKE CORRECT CHOICE OF CURRENT BANK ACCOUNT

The main purpose of opening a current account is to perform all the business transactions
smoothly. It allows the customers to manage bulk transactions and large value payments
conveniently. Therefore, it is rather important to make the correct account choice. All the
parameters should be kept in mind while choosing the most suitable account option. Given
below are the essential parameters one should keep in mind while making the correct current
bank account choice-

 Minimum Balance: Minimum balance is the amount of money which must always be
present in the user’s account in order to prevent the account from deactivating or
lapsing. For current bank account, the minimum balance value is relatively higher in
comparison to savings account. The user needs to keep in mind this factor as the
minimum balance requirement varies from one account variant to another. 

 Fees, Charges and Overdraft Costs: The fees and charges vary from one particular
account to another. The users need to keep in mind important parameters like cash
withdrawal charges, demand draft charges, funds transfer charges, overdraft costs and
more.

 Cash Deposit Limit: The free monthly cash deposit limit may vary from bank to
bank and from one account variant to another.

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 BANK PROFILE

HISTORY OF STATE BANK OF INDIA

State Bank of India (SBI) a Fortune 500 company is an Indian Multinational, Public Sector
Banking and Financial services statutory body headquartered in Mumbai. The rich heritage
and legacy of over 200 years, accredits SBI as the most trusted Bank by Indians through
generations.

The roots of the State Bank of India lie in the first decade of the 18th century, when the  Bank
of Calcutta, later renamed the Bank of Bengal was established on 2 June 1806. The Bank of
Bengal was one of three Presidency banks, the other two being the Bank of Bombay
(incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843). With
the result of the royal charters all three Presidency banks were incorporated as joint stock
companies and received the exclusive right to issue paper currency in 1861 with the Paper
Currency Act. They retained this right till the formation of the Reserve Bank of India. The
Presidency banks amalgamated on 27 January 1921, and the re-organised banking entity took
as its name Imperial Bank of India. The Imperial Bank of India remained a joint stock
company but without Government participation.

The State Bank of India was constituted on 1st July 1955, pursuant to the State Bank of India
Act, 1955 (the "SBI Act") for the purpose of creating a state-partnered and state-sponsored
bank integrating the former Imperial Bank of India. In 1959, the State Bank of India
(Subsidiary Banks) Act was passed, enabling the Bank to take over eight former state
associated banks as its subsidiaries. A process of consolidation began on 13 September 2008,
when the State Bank of Saurashtra merged with SBI.

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SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911), which
SBI acquired in 1969, together with its 28 branches. The next year SBI acquired National
Bank of Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired
Krishnaram Baldeo Bank, which had been established in 1916 in Gwalior State, under the
patronage of Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a small
moneylender, owned by the Maharaja. The new bank’s first manager was Jall N. Broacha, a
Parsi. In 1985, SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was
the acquirer as its affiliate, the State Bank of Travancore, already had an extensive network in
Kerala.

The State Bank of India and all its associate banks are identified by the same
blue keyhole logo. The State Bank of India word mark usually has one standard typeface, but
also utilises other typefaces. The State Bank of India's is largest bank, with approximately
9,000 branches in India and 54 international offices. Its Associate Banks have a domestic
network of around 4,600 branches, with strong regional ties. The Bank also has subsidiaries
and joint ventures outside India, including Europe, the United States, Canada, Mauritius,
Nigeria, Nepal, and Bhutan. The Bank has the largest retail banking customer base in India.

SUBSIDIARIES OF SBI

State Bank of Bikaner & Jaipur (SBBJ)

State Bank of Hyderabad (SBH)
State Bank of Mysore (SBM)
State Bank of Patiala (SBP)
State Bank of Travancore (SBT)

SBI, the largest Indian Bank with 1/4th market share, serves over 45 crore customers through
its vast network of over 22,000 branches, 62617 ATMs/ADWMs, 71,968 BC outlets, with an
undeterred focus on innovation, and customer centricity, which stems from the core values of
the Bank - Service, Transparency, Ethics, Politeness and Sustainability.

The bank is actively involved since 1973 in non–profit activity called Community Services
Banking. All branches and administrative offices throughout the country sponsor and
participate in large number of welfare activities and social causes. Their business is more

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than banking because they touch the lives of people anywhere in many ways. State Bank of
India (SBI) has received an approval from the Government of India (GOI) for acquisition of
SBI Commercial and International Bank (SBICI Bank). The government had issued the
'Acquisition of SBICI Bank Order 2011' vide order dated July 29, 2011.

SBI entered the UK's home loan market, the bank started with mortgages for landlords, best
known as buy–to–let mortgages, with amounts ranging from £50,000 to £1.5 million, and
loan to value of ratios of up to 60 per cent.

In April 2014 State Bank of India launched three digital banking facilities for the
convenience of SBI customers. Two at the customer’s doorstep using TAB banking – one for
customers opening Savings Bank accounts and another for Housing Loan applicants. The
third is e–KYC (Know your Customer).

The Bank has successfully diversified businesses through its various subsidiaries i.e., SBI
General Insurance, SBI Life Insurance, SBI Mutual Fund, SBI Card, etc. It has spread its
presence globally and operates across time zones through 229 offices in 31 foreign countries.

HISTORY OF ICICI BANK

ICICI Bank is a multinational banking and financial services company headquartered in

Mumbai. As of 2014, it was the second largest bank in India by assets and by market
capitalization, and India’s largest private sector bank. It had total assets of Rs.5,946.42 billion
(US$99 billion) and after-tax profit of Rs. 98.10 billion (US$1,637 million) for the year
ending March 31, 2014 (ICICI Bank, 2016a).

With a network of 3,820 branches and 11,798 ATMs in India and 18 other countries, ICICI
Bank offers a wide range of financial products and services to corporate and retail
Consumers, including investment banking, life insurance, venture capital, and asset
management. Analysts credit the bank’s growth to a continuous focus on technological
innovation to its well-versed portfolio of offerings. Despite the fact that ICICI Bank has
fewer international branches than many other Indian banks, it has captured a significant share
of international business, especially in the area of foreign remittances, thanks to its
technological assets. ICICI Bank has also leveraged its technological edge to develop new
products to further expand its influence in the industry.

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ICICI was formed in 1955 at the initiative of the World Bank, the Government of India and
representatives of Indian industry. The principal objective was to create a development
financial institution for providing medium–term and long–term project financing to Indian
businesses. In the 1990s, ICICI transformed its business from a development financial
institution offering only project finance to a diversified financial services group offering a
wide variety of products and services, both directly and through a number of subsidiaries and
affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the first bank
or financial institution from non–Japan Asia to be listed on the NYSE.

After consideration of various corporate structuring alternatives in the context of the

emerging competitive scenario in the Indian banking industry, and the move towards
universal banking, the managements of ICICI and ICICI Bank formed the view that the
merger of ICICI with ICICI Bank would be the optimal strategic alternative for both entities
and would create the optimal legal structure for the ICICI group's universal banking strategy.

The merger would enhance value for ICICI shareholders through the merged entity's access
to low–cost deposits, greater opportunities for earning fee–based income and the ability to
participate in the payments system and provide transaction–banking services. The merger
would enhance value for ICICI Bank shareholders through a large capital base and scale of
operations, seamless access to ICICI's strong corporate relationships built up over five
decades, entry into new business segments, higher market share in various business segments,
particularly fee–based services, and access to the vast talent pool of ICICI and its
subsidiaries.

In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of
ICICI and two of its wholly owned retail finance subsidiaries, ICICI Personal Financial
Services Limited and ICICI Capital Services Limited, with ICICI Bank. The merger was
approved by shareholders of ICICI and ICICI Bank in January 2002, by the High Court of
Gujarat at Ahmedabad in March 2002, and by the High Court of Judicature at Mumbai and
the Reserve Bank of India in April 2002.

Consequent to the merger, the ICICI group's financing and banking operations, both
wholesale and retail, have been integrated in a single entity. The Bank currently has
subsidiaries in the United Kingdom, Russia and Canada, branches in United States,
Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre

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 and representative offices in United Arab Emirates, China, South Africa, Bangladesh,
Thailand, Malaysia and Indonesia. Their UK subsidiary has established branches in Belgium
and Germany. ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and
the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs)
are listed on the New York Stock Exchange (NYSE).

REASON FOR SELECTING THE TOPIC

 As being a post graduate student, one need to know about the basic things related to, a current
account being a zero-account, is generally associated with huge transactions on a regular
basis. Because of the fluidity that these accounts offer, they don’t earn any interest. These
also usually do not carry a limit on the number of transactions which can be made.

 By availing a Current Account for business, it is possible for business owners to keep their
personal assets disjoined from their business assets. Cash inflows can be tracked with ease,
and it allows for enhanced planning and budgeting. Financial records are then easier to
interpret, which helps tremendously when it is time to pay taxes and consider deductions.

 Financial data pertaining to the business is provided in an easy-to-read format, which allows
for smart insights. Statements highlight exactly where and with whom the transactions
have transpired. Most banks provide their clients with instant access to their financial
reports, which also provides a summary of their contacts. Information pertaining to real-
time transactions is also provided and helps make superior decisions pertaining to the
business.

 With a Current Account meant specifically for business, it is possible to ensure that all
transactions are carried out with efficiency and on time. Without any delays on these
transactions, it is possible to maintain positive relations with both suppliers and customers.

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 Current Accounts allow for businesses to avail benefits that are akin to those made available
to Savings Accounts. Almost all banks allow for their business clients with Current
Accounts to avail Demand Drafts, NEFT and RTGS transactions and Pay Orders, free of
cost, in addition to providing them with unlimited withdrawals and deposits.

OBSERVATION OF THE TOPIC

 Will visiting to the bank, it was founded that the document details given on the
website were insufficient and bank orders to give some additional documents
regarding the Current Account.

 The website of the banks assures the process to be completely Digitalized but, in the
bank, it was found that for some or the other reason a customer needs to visit bank or
be in contact with the bank personnel.

 Visiting to the bank it was found that, interest rates are quite different for various
types of current account available in the bank, which was not mentioned in the
website.

FACTS ANALYSED AFTER VISIT TO THE BANK

 Major difference in interest rate was seen in the bank.

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  It was seen that there is an operational burden attached since most package accounts
offer services at additional costs.

 Huge fees due to corporate business transactions.

 The involved paperwork and fine print serve to be lengthy and confusing.

COMPRASION FROM OPTED BANK

PARTICULARS SBI ICICI BANK

Minimum Account Balance Rs. 5000 Rs. 25000

Non-Maintenance Charge Non-Rural- 5000 1000/Month

Rural - 2500

Cash Withdraw Limit Free Cash withdraw from home Unlimited for base withdrawal
branch. and ₹50,000 for non-base
withdrawals.

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Interest Rate Nil Nil

Silver, Gold, Platinum

Types Regular, Gold, Diamond,

Platinum

Free Non-Cash 4 free transactions Upto 200 free transaction.

Transactions

Free Monthly Cash Deposit up to 2 crore per month Upto 5,00,000 per month
limit

Maximum Cash Deposit Rs. 1 Lakh per day Rs. 25000 per day
Limit at Non-Home Branch

1500 cheque leaves free per 150 cheque leaves free per
month month
Free Cheque Leaves

NEFT/RTGS Normal Charges (Free Free NEFT and RTGS

through internet & mobile collections
banking)

Cash withdrawal at Non- Rs. 1 lakh per day by self Free limit of Rs 50,000 per
Home Branch only day (self only)

Demand Draft Normal charges 10 DD / PO free per month

Charges of non- Rs.500/- + GST per month Rs.1000 per month

maintaining of Minimum
MAB

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 Cheque Collection/payment Anywhere Across the Anywhere Across the
country country

Cash Withdrawal at non-

home branch
2,00,000/day Upto 10 cr.

FEATURES AND BENEFITS – SBI BANK CURRENT ACCOUNT

The following are some of the main features and benefits of opening a current account with
State Bank of India (SBI).

 SBI current account offers a premium internet banking facility with complimentary
personal accident insurance.
 Initially, a low minimum average balance can be maintained.
 It also offers an overdraft facility based on one’s credit history.
 ATM transactions are free for the initial year and annually chargeable for subsequent
years.
 Interest for deposit amounts doesn’t hold any interest.
 Based on credit history, overdraft facility is available too.
 Current accounts do not provide any interest on the balance lying in current accounts
with the bank.
 The account can be transferred to any other branch, and monthly statements can be
obtained for the same.
 Multi-city cheque books are given with account opening, and nomination facility is
also accessible.

FEATURES OF ICICI BANK CURRENT ACCOUNT

A Current Account is essentially a deposit account, held with a bank to manage your business
transactions. So, if you own a business, a Current Account is the right account type to go for.
There are a number of advantages of a Current Account that make it distinctly unique:

 Interest rate: 0%

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  Minimum balance requirement – average monthly / quarterly balance (the minimum
balance requirements differ from one bank to another
 Unlimited transactions per day – transfer funds online, receive and write cheques,
cash transactions, and more
 Issuance of cheque books, ATM / Debit Card
 Online Banking Facility
o Bank Transfers (NEFT/RTGS/IMPS)
o Account balance and statements
o Bill payments with standing instructions like EMI or utility payment.

LEARNINGS

 Customers prefer opening Current Account with SBI because of the following

reasons:

 The minimum account balance is Rs. 5000.

 Free cash withdraw from home branch.

 Maximum cash deposit limit at non home branch is higher than other banks.

 SBI provides 1500 cheque leaves free per month.

 Cheque collection or payment is free anywhere in the country.

CONCLUSION

In the last it can said that public sector banks have more transparent policies in comparison to
the private sector banks. Whereas it is a general thought among the customers that private
banks have various kinds of hidden charges which they don’t disclose at the time of
disbursing the loan.
Their policies are driven by profit-making, so, it is always better to read the complete terms
and conditions in advance before taking any decision. Public sector banks provide various
facilities like, Ease of opening an account for individuals aged 18 years and above (resident
and non-resident) and sole proprietorships with an initial deposit of RM3,000, Ease of
opening an account for partnerships, corporate entities, associations, clubs or societies with

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an initial deposit of RM5,000This is a non-interest-bearing account, Overdraft facility
is available upon application.
A monthly statement is provided making it easier for you to keep track of your expenditure,
Easy access to your account through any Public Bank branch, ATM or PBe.If you are looking
to start a business, you will find that a Current Account is a primary requirement to get
started. This will help you acquire investors or apply for a business loan to fund your capital
requirements. If you are looking for a Current Account to help you get started, SBI Bank
Current Accounts offer several features that are uniquely tailored to new businesses.

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