A STUDY ON CREDIT APPRAISAL PROCESS AT HDFC BANK

Abstract

Credit appraisal is a systematic process by which banks evaluate borrower creditworthiness before sanctioning loans. HDFC Bank, India's largest private sector bank, employs a structured multi-layered appraisal framework integrating quantitative financial analysis with qualitative risk assessment to minimize non-performing assets (NPAs). This paper studies the end-to-end credit appraisal process at HDFC Bank, examining loan application workflows, CIBIL score evaluation, financial statement analysis, collateral assessment, risk rating, and post-disbursement monitoring. Primary data was gathered through structured interviews with bank officials. Secondary data was sourced from HDFC Bank annual reports (2021–2024), RBI publications, and academic literature. Findings reveal CIBIL score, debt-to-income ratio, and collateral adequacy as primary determinants of credit decisions. The study identifies process inefficiencies including manual verification delays and information asymmetry, and recommends AI-based credit scoring and digital document verification to enhance appraisal efficiency