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There are several required items that should be drafted when creating the Franchise Disclosure Document. Some may not apply to the company owing the franchise, others will. Be sure to have an attorney review the document prior to releasing for potential franchisees to read.

Item 1 the franchise company
This is a summary of the history, ownership and corporate family of the franchisor, including the form of franchises offered. A company summary that isn’t clear or readable does not allow you to get an accurate picture of the organization without a lot of effort. If so it is likely you will have issues interpreting the rest of the FDD.

Item 2 Business Experience Of Franchise Executives
Gaining knowledge of the franchisor’s leadership is critical, because it will help you decide whether you’ll feel comfortable working with the people involved. Look for a solid group with experience in management and franchising. An executive team that is new to franchising may be a problem unless they have extensive business expertise. If the executives have been involved in failures with other businesses then this is an indication of a problem.

Item 3 Litigation
This item lets you know about any litigation involving the company and its principals and executives. It notifies you of potential accusations against the franchisor, as well as whether it has filed suits against entities violating its trademarks or against franchisees not in obedience with quality standards (which may be a good thing). If there are multiple lawsuits filed by franchisees contending fraud or misrepresentation on the part of the franchisor this is an indication of a serious problem. Is there a pending class action by franchisees or consumers that, if successful, could bankrupt the company?

Item 4 Bankruptcy
This item is rarely of great interest, because your due diligence should have indicated whether the franchisor is in bankruptcy. Any officer or director who has a personal bankruptcy, or was previously involved in a bankrupt franchisor, also must be listed.

Items 5, 6 and 7 Initial Fees, Other Fees and Initial Investment
Item 5 is an overview of the initial fees required to open your franchise. Item 6 is a chart of other fees, including royalty and advertising fees, which you will be required to pay on an ongoing basis. Be aware that not all fees are listed here, including the cost of products and inventory. Item 7 lays out the fees and expenses required to open and operate your franchise for the first three months. Watch out for: Franchisees get into trouble when they are undercapitalized. Do not assume that the working capital listed in Item 7 is sufficient to sustain your business until you start making money. Ask other franchisees how long it took them to break even. Go over these items with an accountant before signing a franchise agreement.

Item 8 Restrictions on Sources of Products and Services
The franchisor has a vested interest in knowing that the products and services you are utilizing or selling meet its standards. To ensure that, the company may sell you products itself or insist you use selected suppliers. Beware of Franchisors who are getting large rebates from suppliers. Ask current franchisees if they feel the prices they pay for designated products are fair.

Item 9 Franchisee’s Obligations
This is the single best disclosure you will get: a list of your contractual obligations, with cross-references to the franchise agreement and the rest of the FDD. Item 9 allows you to review each obligation, then go back and read the language by which you will operate. Descriptions that are not consistent with the franchise agreement are problematic.

Item 10 Financing
If the franchisor offers a lending program, or has arrangements with lenders who have agreed to help finance its franchisees. The item also discloses any financial relationship the outside lender has with the franchisor. Remember that borrowing from your franchisor is no different than borrowing from a bank, with the same credit terms. If you default, the franchisor can terminate your franchise agreement.

Item 11 Franchisor’s Assistance, Advertising, Computer Systems And Training
This item outlines the subject matter and extent of the franchisor’s support services. It should include disclosures about cash registers and related information involving the use of extremely sensitive franchisee data to which the franchisor has access. Subtle qualifying words, such as “at our discretion” or “as needed,” generally indicate that you cannot count on receiving those services. Look carefully to see how much of your required advertising fees actually get spent on advertising and how much can be used in areas mainly benefit the franchisor. Also note that if franchisees are not involved in managing the national marketing fund and program, it can be a major red flag for investors.

Item 12 Territory
The need for a protected territory depends on the nature of the business. The franchisee of a retail outlet wants to know that another unit cannot open within a certain radius; a service business might find different stipulations. Any territorial protection lasts only for the term of your franchise agreement; the franchisor has the flexibility to change it when you renew your contract. Retail franchises that provide no geographic protection are challenging.

Items 13 and 14 Trademarks, Patents, Copyrights and Proprietary Information
These straightforward items list the trademark and copyright registrations the franchisor has obtained. Watch out for: A trademark that is not registered.

Item 15 Obligation to Participate in the Actual Operation of the Franchise Business
Franchisors want to be sure franchisees are devoting full time and effort to running each location. Some franchises require franchisees to run the business, others allow them to be passive owners and hire someone else to manage day-to-day operations.

Item 16 Restrictions on What You May Sell
This item lets you know that you can sell only what the franchisor allows. Franchisors whose product offerings are too limited could negatively impact the business.

Item 17 Renewal, Termination, Transfer And Dispute Resolution
This chart provides a summary of the franchise relationship to the franchisee, with cross-references to the franchise agreement, showing terms of termination and renewal and asserting where and how disagreements will be resolved. In franchising, you don’t have a right to renew, only a right of first refusal on a new contract, which may contain higher royalties and other charges. When signing your first contract, try to maintain as many financial conditions in the renewal contract as you can. Most disputes must be resolved in the hometown of the franchisor, which puts the franchisee at a disadvantage.

Item 18 Public Figures
This is relevant only if you are buying into the less than 1 percent of franchise systems that use public figures in their advertising.

Item 19 Financial Performance Representations
Although this is one of the most important pieces of the FDD, only 30 to 40 percent of franchisors provide information on how much their current franchisees are earning; the others must state that they choose not to make such a claim. Earnings claims based on corporate stores may not be accurate as they pay no royalties and may have different labor, rent, product and shipping costs than you will experience. Beware of earnings based on franchises that have been open for five to 10 years, which may pay lower rents.

Item 20 Outlets and Franchise Information
These charts show the number of franchises opened, transferred and closed in the last three years, which lets you see whether the system is growing or shrinking. The most important part of the FDD is the list of current and former franchisees. You would be completely remiss not to contact as many as possible to get an independent perspective on the health of the system. A large number of closures could mean the business model is trending out of favor.

Item 21 Financial Statements
These audited financial statements let you know if the franchisor is stable. Look at the profit-and-loss statement first, then the balance sheet. You may need an accountant to figure out whether the current ratio of assets to liabilities is favorable and how the franchisor accounts for deferred revenue. Be sure to read the footnotes. Franchisors who earn most of their money from franchise sales are not sustaining their business. Good franchisors that operate more efficiently do so with royalty payments.

Items 22 And 23 Contracts and Receipts
These items include the contracts you will be required to sign and the receipt you must sign when you receive the FDD. It is critical that you read and understand the contracts and keep copies of all documents (including the receipt); you’ll need them if you ever wish to bring an action against the franchisor.

In the world of banking and finance nothing stands still. The biggest change of all is in the, scope of the business of banking. Banking in its traditional from is concerned with the acceptance of deposits from the customers, the lending of surplus of deposited money to suitable customers who wish to borrow and transmission of funds. Apart from traditional business, banks now a days provide a wide range of services to satisfy the financial and non financial needs of all types of customers from the smallest account holder to the largest company and in some cases of non customers. The range of services offered differs from bank to bank depending mainly on the type and size of the bank.

RESERVE BANK’S EARLY INITIATIVES
As a central bank in a developing country, the Reserve Bank of India (RBI) has adopted development of the banking and financial market as one of its prime objectives. “Institutional development” was the hallmark of this approach from 1950s to 1970s. In the 1980s, the Reserve Bank focused on “improvements in the productivity” of the banking sector. Being convinced that technology is the key for improving in productivity, the Reserve Bank took several initiatives to popularize usage of technology by banks in India.

Periodically, almost once in five years since the early 1980s, the Reserve Bank appointed committees and working Groups to deliberate on and recommend the appropriate use of technology by banks give the circumstances and the need. These committees are as follows:
-Rangarajan committee -1 in early 1980s.
-Rangarajan committee -11 in late 1980s.
-Saraf working group in early 1990s.
-Vasudevan working group in late 1990s.
-Barman working group in early 2000s.

Based on the recommendations of these committees and working groups, the Reserve Bank issued suitable guidelines for the banks. In the 1980s, usage of technology for the back office operations of the banks predominated the scene. It was in the form of accounting of transactions and collection of MIS. In the inter-bank payment systems, it was in the form of clearing and settlement using the MICR technology.

Two momentous decisions of the Reserve Bank in the 1990s changed the scenario for ever there are:
a) The prescription of compulsory usage of technology in full measure by the new private sector banks as a precondition of the license and
b) The establishment of an exclusive research institute for banking technology institute for development and Research in Banking Technology.

As the new private sector banks came on the scene as technology-savvy banks and offered several innovative products at the front office for the customers based on technology, the demonstration effect caught on the reset of the banks. Multi channel offerings like machine based (ATMs and pc-Banking), card based (credit/Debit/Smart cards), Communication based (Tele-Banking and Internet Banking) ushered in Anytime and Anywhere Banking by the banks in India. The IDRBT has been instrumental in establishing a safe and secure, state of the art communication backbone in the from of the Indian Financial NETwork (INFINET) as a closed user group exclusively for the banking and financial sector in India.

CHANGING FACE OF BANKING SERVICES
Liberalization brought several changes to Indian service industry. Probably Indian banking industry learnt a tremendous lesson. Pre-liberalization, all we did at a bank was deposit and withdraw money. Service standards were pathetic, but all we could do was grin and bear it. Post-liberalization, the tables have turned. It’s a consumer oriented market there.

Technology is revolutionizing every field of human endeavor and activity. One of them is introduction of information technology into capital market. The internet banking is changing the banking industry and is having the major effects on banking relationship. Web is more important for retail financial services than for many other industries.

Retail banking in India is maturing with time, several products, which further could be customized. Most happening sector is housing loan, which is witnessing a cut-throat competition. The home loans are very popular as they help you to realize your most cherished dream. Interest rates are coming down and market has seen some innovative products as well. Other retail banking products are personal loan, education loan and vehicles loan. Almost every bank and financial institution is offering these products, but it is essential to understand the different aspects of these loan products, which are not mentioned in their colored advertisements.

PLASTIC MONEY
Plastic money was a delicious gift to Indian market. Giving respite from carrying too much cash. Now several new features added to plastic money to make it more attractive. It works on formula purchase now repay later. There are different facts of plastic money credit card is synonyms of all.

Credit card is a financial instrument, which can be used more than once to borrow money or buy products and services on credit. Banks, retail stores and other businesses generally issue these. On the basis of their credit limit, they are of different kinds like classic, gold or silver.

Charged cards-these too carry almost same features as credit cards. The fundamental difference is you can not defer payments charged generally have higher credit limits or some times no credit limits.
Debit cards-this card is may be characterized as accountholder’s mobile ATM, for this you have to have account with any bank offering credit card.

Over the years, the banking sector in India has seen a no. of changes. Most of the banks have begun to take an innovative approach towards banking with the objective of creating more value for customers and consequently, the banks. Some of the significant changes in the banking sector are discussed below.

MOBILE BANKING
Taking advantages of the booming market for mobile phones and cellular services, several banks have introduced mobile banking which allows customers to perform banking transactions using their mobile phones. For instances HDFC has introduced SMS services. Mobile banking has been especially targeted at people who travel frequently and to keep track of their banking transaction.

RURAL BANKING
One of the innovative scheme to be launched in rural banking was the KISAN CREDIT CARD (KCC) SCHMME started in fiscal 1998-1999 by NABARD. KCC mode it easier for framers to purchase important agricultural inputs. In addition to regular agricultural loans, banks to offer several other products geared to the needs of the rural people.

Private sector Banks also realized the potential in rural market. In the early 2000’s ICICI bank began setting up internet kiosks in rural Tamilnadu along with ATM machines.

NRI SERVICES
With a substantial number of Indians having relatives abroad, banks have begun to offer service that allows expatriate Indians to send money more conveniently to relatives India which is one of the major improvements in money transfer.

E-BANKING
E-Banking is becoming increasingly popular among retail banking customers. E-Banking helps in cutting costs by providing cheaper and faster ways of delivering products to customers. It also helps the customer to choose the time, place and method by which he wants to use the services and gives effect to multichannel delivery of service by the bank. This E-Banking is driven by twin engine of “customer-pull and Bank-push”.

CONCLUSION
Technology has been one of the most important factors for the development of mankind. Information and communication technology is the major advent in the field of technology which is used for access, process, storage and dissemination of information electronically. Banking industry is fast growing with the use of technology in the from of ATMs, on-line banking, Telephone banking, Mobile banking etc., plastic card is one of the banking products that cater to the needs of retail segment has seen its number grow in geometric progression in recent years. This growth has been strongly supported by the development of in the field of technology, without which this could not have been possible of course it will change our lifestyle in coming years.

Franchising Disclosure Document (FDD) Items

Impact Of Technology In Banking