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Jaypee Business School

A constituent of Jaypee Institute of Information Technology (Deemed University) A-10, Sector 62, Noida (UP) India 201 307

Customer Satisfaction at HDFC Branch, Gurdaspur

Corporate Internship Report

Internship Report submitted as a partial requirement for the award of the two year Master of Business Administration Programme MBA 2011-13 Name: Manik Dogra (12609110) Email id:


Corporate Internship Supervisor Name: Mr. Gaurav Mahajan (Branch Manager) JBS Faculty Supervisor: Mr. Ashok Wahi
Start Date for Internship: 6/5/2013 End Date for Internship: 20/6/2013

This is to certify that the project report entitled Customer satisfaction at HDFC Gurdaspur Branch is based on my own work carried out during the course of my study under the supervision of Mr. Ashok Wahi. I assert that the statements made and conclusions drawn are an outcome of the project work. I further declare to the best of my knowledge and belief that the matter embodied has not been submitted earlier for award of any degree or diploma in this or any other university. Manik Dogra(12609110) Date: ________

Certificate from organization

I would like to take this opportunity to acknowledge all the people whose guidance and inspiration helped me in my summer internship project. Firstly, I would like to thank our prestigious institute the Jaypee Business School, Noida for including the summer internship as part of its curriculum. This summer internship has provided us with a wonderful opportunity to nurture & improve upon our research and presentation capabilities. I would like to thank Mr. Sushil, Operation Manager, for his continuous support, timely advice and guidance. I also convey my regards to , Personal Banker & .., Relationship Manager for their Suggestions. Last but not the least, I express my sincere gratitude to my faculty guide Mr. Ashok Wahi for his valuable time and support. His timely suggestions and feedback helped me in shaping my project in the desired manner. I am also grateful to my parents and all my friends for their support, interest and valuable suggestions which enabled me to complete this project.

Table of Contents
Particular Declaration Certification from the organization Acknowledgment
1. Executive summary 2. Introduction & Objective 3. Company Profile Company Profile Promise, Mission & Vision Statements Subsidiaries Presence across India Product Price Distribution network Promotion 4. Industry Analysis Industry outlook Industry Structure Pricing the Cement PEST Analysis Porters Five Forces Industry SWOT analysis Road Ahead 5. Financial Analysis 6. Project Work Objective of Study Processes Under Marketing/Sales Department Driving Forces Market Analysis & Findings Jaypee SWOT Analysis 7. Limitation 8. Recommendation 9. Conclusion 10. Key Learning 11. Annexure-I 12. Annexure-II 13. Annexure-III 14. Reference 15. Questionnaire

Page No.

6 8 9 11 12 13 14 17 18 21 22 23 25 26 35 37 38 39 53 56 59 60 75 76 77 79 80 81 82 83 84

A satisfied customer is the best business strategy of all. -Michael LeBoeuf
While working with HDFC bank during my 8 weeks summer internship I came to know about various aspects of banking and various process that occurs in banks. And I suppose sole aim of any commercial bank is to take deposits; issue loans and conduct other related financial services. Deposits made into bank accounts are savings, money market and checking. These are just profit seeking institutions that are primarily concerned with receiving deposits and lending. The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995. After getting the opportunity to undergo my 8 weeks summer training in HDFC Bank I carried out my project Customer Satisfaction at HDFC Gurdaspur Branch . I spent the two weeks in getting knowledge about the Bank profile and understanding various operations that were being carried out in the branch. The remaining time I spent in studying, analyzing and understanding the level of satisfaction of customers towards HDFC bank, Gurdaspur Branch, which was the project assigned to me by the Branch Manager. Various Operations that are carried out in Gurdaspur Branch as a follows:
Accepting Deposits Advancing Loans Discounting the bills of exchange Provide Cheap Medium of Exchange Safe Money Transfer Bill Payments Locker Services Investments

During the Industry Analysis I have found that the Indian banking sector has emerged as one of the strongest drivers of Indias economic growth. The Indian banking industry (US$ 1.22 trillion) has made outstanding advancement in last few years, even during the times when the rest of the world was struggling with financial meltdown. India's economic development and financial sector liberalization have led to a transformation of the Indian banking sector over the past two decades. The Indian banking sector is a mixture of public, private and foreign ownerships. The below table highlights top 10 banks which contributed 58% share of the total credit as on March 31, 2011. The State bank of India has recorded highest market share. The Net Interest Margin of HDFC Banks is 4.2% which is highest among others. I have also done detailed financial analysis of HDFC BANK to understand its financial position. The comparative analysis has been done between __________ and ______________ for last three year.


Introduction to HDFC Bank
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

Introduction to Summer Internship Project

Todays successful companies share one thing in common: Strong customer oriented approach and strong commitment to service. In my Summer Internship project I had understand the various operations of the HDFC Bank at Gurdaspur Branch and Analyze and understand the level of satisfaction of the customers towards HDFC and its competitors. And for that I have surveyed approximately 250 customers.

Introduction to Internship Report

In this report I tried to understand the Banking industry on a whole i.e. its structure, political economic, social and technical factors and also how hostile is this Industry for all the banks in it. I have done the financial analysis of HDFC BANK and have done comparative analysis between _____________________&____________________

To understand the various processes and operations that are carried out in HDFC Gurdaspur Branch To understand the structure of the Banking industry. To know how various Political, Economic, Social, and Technological factors affecting the Indian Banking industry. To know about the strengths & weaknesses of banking sector and the various opportunities and threats present in the industry To do the financial analysis of the bank.

Company Profile
HDFC is India's premier housing finance company and enjoys an impeccable track record in India as well as in international markets. Since its inception in 1977, the Corporation has maintained a consistent and healthy growth in its operations to remain the market leader in mortgages. Its outstanding loan portfolio covers well over a million dwelling units. HDFC has developed significant expertise in retail mortgage loans to different market segments and also has a large corporate client base for its housing related credit facilities. With its experience in the financial markets, a strong market reputation, large shareholder base and unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian environment. The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

Board of Directors
Name C M Vasudev Aditya Puri Harish Engineer Paresh Sukthankar Anami N Roy Ashim Samanta Bobby Parikh Partho Datta Renu Karnad Pandit Palande Designation Non Executive Chairman Managing Director Executive Director Executive Director Director Director Director Director Director Director

Vice president (legal) & company secretary: Mr. Sanjay Dongre Auditors : Mr. P.C. Hansotia &Co (Chartered accountants)

Broad Areas in Which It Operates

The Bank operates in three segments: retail banking, wholesale banking and treasury services. The retail banking segment serves retail customers through a branch network and other delivery channels. The wholesale banking provides loans and transaction services to corporate and institutional customers. The treasury services segment undertakes trading operations on the proprietary account, foreign exchange operations and derivatives trading. The Bank operates in India.

Retail Banking
This segment raises deposits from customers and makes loans and provides advisory services to such customers. The objective of the Retail Bank is to provides its target market customers a range of financial products and banking services, giving the customer a one-stop window for all his/her banking requirements. The products are backed by service and delivered to the customers through the growing branch network, as well as through alternative delivery channels like automated teller machines (ATMs), phone banking, net banking and mobile banking. The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank Plus and the Investment Advisory Services programs have been designed keeping in mind needs of customers who seek distinct financial solutions, information and advice on various investment avenues. The Bank also has an array of retail loan products, including auto loans, loans against marketable securities, personal loans and loans for two-wheelers. It is also a provider of depository participant (DP) services for retail customers, providing customers the facility to hold their investments in electronic form. HDFC Bank has launched an international debit card in association with VISA (VISA Electron) and also issues the MasterCard Maestro debit card. The Bank launched its credit card business during the fiscal year ended March 31, 2001. By September 30, 2005, the bank had a total card base (debit and credit cards) of 5.2 million cards. The Bank is also engaged in the merchant acquiring business with over 50,000 point-of-sale (POS) terminals for debit/credit cards acceptance at merchant establishments.

Wholesale Banking
The Bank's target market ranges from large, blue-chip manufacturing companies in the Indian corporate to small and mid-sized corporates and agri-based businesses.

For these customers, the Bank provides a range of commercial and transactional banking services, including working capital finance, trade services, transactional services and cash management. The bank is also a provider of structured solutions, which combine cash management services with vendor and distributor finance for facilitating superior supply chain management for its corporate customers. It provides cash management and transactional banking solutions to corporate customers.

Treasury Services
Within this business, the bank has three main product areas: Foreign Exchange and Derivatives, Local Currency Money Market & Debt Securities, and Equities. Risk management information, advice and product structures, as well as fine pricing on various treasury products are provided through the Bank's Treasury team. The Treasury business is responsible for managing the returns and market risk on this investment portfolio.

Customer focus
HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the bank's risk appetite. The bank is committed to maintain the highest level of ethical standards, professional integrity, corporate governance and regulatory compliance. HDFC Bank's business philosophy is based on four core values Operational Excellence, Customer Focus, Product Leadership and People

Capital structure
Authorized capital of HDFC Bank is Rs.450 crore (Rs.4.5 billion). The paid-up capital is Rs.311.9 crore (Rs.3.1 billion). The HDFC Group holds 22.1% of the bank's equity and about 19.4% of the equity is held by the ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue). Roughly 31.3% of

the equity is held by Foreign Institutional Investors (FIIs) and the bank has about 190,000 shareholders. The shares are listed on the The Stock Exchange, Mumbai and the National Stock Exchange. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB

Various Services
Forex and trade services
HDFC Bank has a range of products and services that one can choose from to transact smoothly.The following are different methods of transacting in foreign exchange and remitting money. Travelers cheques Foreign currency cash. Foreign currency drafts Cheque deposits Remittances Cash to master Trade services Foreign services branch locator

Important guidelines and schedules

All Foreign Exchange transactions are conducted by strictly adhering to RBI guidelines. Depending on the nature of your transaction or point of travel, you will need to understand your Foreign Exchange limits.


Whatever your need, our range of loans can help Home Loans Personal Loans Two Wheeler Loans New Car Loans Used Car Loans Overdraft Against Car Express Loans Loans Against Securities Loans Against Property

Personal Banking
Savings Accounts
These Accounts are primarily meant to inculcate a sense of saving for the future, accumulating funds over a period of time. Whatever may be the occupation, bank is confident that customer will find the perfect banking solution. Open an account in your name (customers name) or register for one jointly with a family member today.

Current Accounts
Now, with an HDFC Bank Current Account, experience the freedom of multi-city banking! Customer can have the power of multi-location access to his account from any of banks 500 branches in 220 cities. Not only that, he can do most of his banking transactions from the comfort of his office or home without stepping out. At HDFC Bank, it understands that running a business requires time and money, also that customers business needs are constantly evolving. That's where it come in. It provides him with a choice of Current Account options to exclusively suit his business - whatever the size or scope.

Fixed Deposits
Long-term investments form the chunk of everybody's future plans. An alternative to simply applying for loans, fixed deposits allow the customer to borrow from his own funds for a limited period, thus fulfilling his needs as well as keeping his savings secure. As per the finance (No 2) Act 2004, all fees & charges mentioned in the Tarriffs, Charges or Fees Brochures will attract Service Tax @10% & Education Cess @2% of the service tax amount effective 10th September 2004. The same will appear as separate debits in the statements.

Private banking
HDFC Bank offers Private Banking services to high net worth individuals and institutions. Banks team of seasoned financial and investment professionals provide objective guidance backed by thorough research and in-depth analysis keeping in mind customers financial goals.

Multiple Recognition from Euro money

At HDFC Bank, they have always strived towards providing exceptional service to each of their esteemed customers. As testament to this dedication, they have earned the following ranks in a recently conducted Euromoney Survey.

Rated as the best private bank in the super effluent category in India HDFC Bank Investment Advisory Services - Helping you take your Investment portfolio further.

Dedicated investment advisor

HDFC Private Banking service involves a high degree of personalization. When customer avail of this facility, a dedicated Investment Advisor serves him. This seasoned finance professional adds value to his portfolio by keeping him up to date with financial markets and investment opportunities

Payment services
With HDFC Bank's payment services, one can bid goodbye to queues and paper work. Its range of payment options make it easy for customer to pay for a variety of utilities and services.

Verified by visa
If one wants to be worry free for his online purchases. Now he can shop securely online with his existing Visa Debit/Credit card.

Net safe
Now shop online without revealing your (customers) HDFC Bank Credit Card number.

Prepaid refill
If a person is a HDFC Bank Account holder and a prepaid customer, he can now refill his Prepaid Mobile card with this service.

Bill pay
One can pay his telephone, electricity and mobile phone bills at his convenience. Through the Internet, ATMs, his mobile phone and telephone - with Bill Pay, banks comprehensive bill payments solution

Visa Bill Pay

One can pay his utility bills from the comfort of his home! Pay using his HDFC Bank Visa credit card and forget long queue and late payments forever

Insta pay
One can Pay his bills, make donations and subscribe to magazines without going through the hassles of any registration.

Direct pay
Shop or Pay bills online without cash or card. Debit your (customers) account directly with banks Direct Pay service!

Smart pay(with credit cards)

With Smart Pay, paying customers r electricity, telephone, mobile phone, water bills, gas and insurance premia payments becomes easy like never before.

Visa money transfer

One can transfer funds to any Visa Card (debit or credit) within India at his own convenience through HDFC Bank's Net Banking facility.

E-Monies Electronic Funds Transfer

Transfer funds from customers account to any account in any Bank in India at 15 locations - FREE of cost

Online payment of excise and service tax

One can make his Excise and Service Tax payments at his own convenience.

Preferred/classic banking
If a customer expects more from everything, even HDFC bank, will invite him into the world of exclusive banking. Where he will never again have to wait to be served. With HDFC Bank Preferred Programme, his comfort always comes first. Ideal for seasoned professionals or businessmen, this programme will provide him with a banker dedicated to take care of all his banking and investment needs. It also means he get preferential rates on various banking products and other exclusive benefits.

Hdfc bank classic banking

If a person wants to experience banking beyond the ordinary, our HDFC Bank Classic Programme is just for him. Becoming an HDFC Bank Classic customer entitles him to a host of benefits, including a bouquet of preferentially priced products and specialized wealth management solutions.

Awards and Achievements

HDFC Bank began operations in 1995 with a simple mission: to be a "World-class Indian Bank". They realized that only a single-minded focus on product quality and service excellence would help them get there. Today, they are proud to say that they are well on the way towards that goal.

2010 Business Today: Best Bank in India. Forbes Top 2000 Companies: Bank at 632nd Position

Business world: Best Bank (large) The Banker Magazine: Words Top 1000 bank Asia money Awards: Best Local Cash Management Bank in Large and Medium segments Euro money Awards: "Best Bank" in India

2009 Asia money Awards: Best Domestic Commercial Bank Asia money Awards: Best Cash Management Bank India Global Finance Award: Best Trade Finance Bank. The Asian Banker Excellence: Retail Banking Risk Management Award in India: Best Bank India Economic Times Awards: Best Bank in India 2009

2008 Finance Asia Country Awards For Achievement 2008: Best Bank and Best Cash and Management Bank. Buisness India: Best bank 2008 Forbes Asia: Fab 50 Companies in pacific Asia. Buisness Today: Best Bank Award

Till Year 2007 HDFC Bank named the "Most Customer Responsive Company - Banking and Financial Services in The Economic Times - Avaya Global IT User in Banking' at the IT Users Awards 2003. Outlook Money & NDTV Profit : Best Bank in the Private sector category. The Asian Banker Excellence in Retail Financial Services Award : Best Retail Bank in India. Asian Banker : Managing Director Aditya Puri wins the Leadership Award For india. Most Improved Company for Best Management Practices in India 2004 HDFC Bank has been named Best Domestic Bank in India in The Asset Triple A Country Awards 2005. The Business Today-KPMG Survey published in the leading Indian business magazine Business Today has named HDFC Bank "Best Bank in India" for the third consecutive year in 2005. The Asset magazine named HDFC Bank "Best Cash Management Bank" and "Best Trade Finance Bank" in India, in 2006. Connect Customer Responsiveness Awards 2005" HDFC Bank has been named Best Domestic Bank in India Region in The Asset Triple A Country Awards 2004 and 2003. In 2004, HDFC Bank was selected by BusinessWorld as "One of India's Most Respected Companies" as part of The Business World Most Respected Company Awards 2004.

In 2004, Forbes Global again named us in its listing of Best under a Billion, 100 Best Smaller Size Enterprises in Asia/Pacific and Europe, in its November 1, 2004 issue. In 2004, HDFC Bank won the award for "Operational Excellence in Retail Financial Services" - India as part of the Asian Banker Awards 2003. In 2003, Forbes Global named us in its ranking of "Best under a Billion, 200 Best Small Companies for 2003". Leading business newspaper The Financial Express named HDFC Bank the "Best New Private Sector Bank 2003" in the FE-Ernst & Young Best Banks Survey 2003. Leading Personal Finance Magazine in India Outlook Money named HDFC Bank the "Best Bank in the Private Sector" for the year 2003. Leading Indian business magazine Business Today in a survey rated us "Best Bank in India" 2003, and "Best Private Sector Bank" in India in 1999. NASSCOM and have named us the 'Best There have been some other proud moments as well London-based Euromoney magazine gave us the award for "Best Bank - India" in 1999, "Best Domestic Bank" in India in 2000, and "Best Bank in India" in 2001 and 2002 Asia money magazine has named us "Best Commercial Bank in India 2002". For our use of information technology we have been recognized as a "Computerworld Honors Laureate" and awarded the 21st Century Achievement Award in 2002 for Finance, Insurance & Real Estate category by Computerworld, Inc., USA. Our technology initiative has been included as a case study in their online global archives.The Economic Times has conferred on us The Economic Times Awards for Corporate Excellence as the Emerging Company of the Year 2000-01. Leading Indian business magazine Business India named us "India's Best Bank" in 2000. In the year 2000, leading financial magazine Forbes Global named us in its list of "The 300 Best Small Companies" in the world and as one of the "20 for 2001" best small companies in the world.

Corporate Governance
HDFC Bank recognizes the importance of good corporate governance, which is generally accepted as a key factor in attaining fairness for all stakeholders and achieving organizational efficiency. This Corporate Governance Policy, therefore, is established to provide a direction and framework for managing and monitoring the bank in accordance with the principles of good corporate governance.

Profile of HDFC Mutual Fund

HDFC Asset Management Company Ltd (AMC) was incorporated under the Companies Act, 1956, on December 10, 1999, and was approved to act as an Asset Management Company for the HDFC Mutual Fund by SEBI vide its letter dated June 30, 2000. The registered office of the AMC is situated at Ramon House, 3rd Floor, H.T. Parekh Marg, 169, Back bay Reclamation, Church gate, Mumbai - 400 020. In terms of the Investment Management Agreement, the Trustee has appointed the AMC to manage the Mutual Fund. As per the terms of the Investment Management Agreement, the AMC will conduct the operations of the Mutual Fund and manage assets of the schemes, including the schemes launched from time to time.

The present shareholding pattern of the AMC is as follows

Particulars Housing Development Finance Corporation Limited Standard Life Investments Limited Percentage of the Paid Capital 50.10 49.90

To be a dominant player in the Indian mutual fund space, recognized for its high levels of ethical and professional conduct and a commitment towards enhancing investor interests

The Board of Directors of the HDFC Asset Management Company Limited (AMC) Mr. P. M. Thampi Dr. Deepak Phatak Mr Rajeshwar Raj Bajaaj Ms. Renu S. Karnad Mr. Milind Barve

Mr. Deepak S Parekh Mr. N. Keith Skeoch Mr Mark Connolly Mr. Hoshang S. Billimoria Mr. Humayun Dhanrajgir

The AMC is managing 3 close ended schemes HDFC Fixed Investment Plan HDFC Long Term Equity Fund and HDFC Fixed Maturity Plans

And, 22 open-ended schemes of the Mutual Fund HDFC Growth Fund (HGF) HDFC Balanced Fund (HBF) HDFC Income Fund (HIF) HDFC Liquid Fund (HLF) HDFC Long Term Advantage Fund (formerly HDFC Tax Plan 2000)(HTP) HDFC Children's Gift Fund (HDFC CGF) HDFC Gilt Fund (HGILT) HDFC Short Term Plan (HSTP) HDFC Index Fund HDFC Floating Rate Income Fund (HFRIF) HDFC Equity Fund (HEF) HDFC Top 200 Fund (HT200) HDFC Capital Builder Fund (HCBF) HDFC TaxSaver (HTS) HDFC Prudence Fund (HPF) HDFC High Interest Fund (HHIF) HDFC Cash Management Fund (HCMF) HDFC MF Monthly Income Plan (HMIP) HDFC Core & Satellite Fund (HCSF) HDFC Multiple Yield Fund (HMYF) HDFC Premier Multi-Cap Fund. (HPM) HDFC Multiple Yield Fund - Plan 2005 (HMY2005)

The AMC is also providing portfolio management / advisory services and such activities are not in conflict with the activities of the Mutual Fund.The AMC has renewed its registration from SEBI vide Registration No. - PM / INP000000506 dated December 4, 2003 to act as a Portfolio Manager under the SEBI (Portfolio Managers) Regulations, 1993.The Certificate of Registration is valid from January 1, 2004 to December 31, 2006 .

Industry Outlook
The Indian banking sector has emerged as one of the strongest dri vers of Indias economic growth. The Indian banking industry (US$ 1.22 trillion) has made outstanding advancement in last few years, even during the times when the rest of the world was struggling with financial meltdown. India's economic development and financial sector liberalization have led to a transformation of the Indian banking sector over the past two decades. Today Indian Banking is at the crossroads of an invisible revolution. The sector has undergone significant developments and investments in the recent past. Most of banks provide various services such as Mobile banking, SMS Banking, Net banking and ATMs to their clients. Indian banks, the dominant financial intermediaries in India, have made high-quality progress over the last five years, as is evident from several factors, including annual credit growth, profitability, and trend in gross non-performing assets (NPAs). While annual rate of credit growth clocked 23% during the last five years, profitability (average Return on Net Worth) was maintained at around 15% during the same period, while gross NPAs fell from 3.3% as on March 31, 2006 to 2.3% as on March 31, 2011. The Indian banking sector is a mixture of public, private and foreign ownerships. The below table highlights top 10 banks which contributed 58% share of the total credit as on March 31, 2011. The State bank of India has recorded highest market share. The Net Interest Margin of HDFC Banks is 4.2% which is highest among others.

The Credit off-take has increased at a CAGR of 19.9 % over FY 0611. The Deposits have grown at a CAGR of 18.2% over FY 06-11 on account of strong growth in saving account. The net NPA has increased from 1% in FY 2008 to 1.12% in FY 10. The High interest rates and lower economic growth has impacted the repayment capacities of borrowers and hence pushing up the NPAs of banks. The net NPA decelerated from 1.12% in FY 10 to 0.97% in FY 11. Indian banks enjoyed higher levels of money supply, credit and deposits as a percentage of GDP in FY11 as compared to that in FY10 showing improved maturity in the financial sector. Credit growth remained high in the first half of FY11 on account of increased

demand from industry and the service sector. Personal loans grew significantly by 17% during 2010-11 as compared with 4.1% during the previous year.

The Reserve Bank of India, the nations central bank, began operations on April 01, 1935. It was established with the objective of ensuring monetary stability and operating the currency and credit system of the country to its advantage.

In India, the banks are being segregated in different groups. Each group has their own benefits, own dedicated target markets, limitations in operating in India. The commercial banking structure in India consists of Scheduled Commercial Banks and Unscheduled Banks. Scheduled commercial Banks constitute those banks which have been included in the Second Schedule of Reserve Bank of India (RBI) Act, 1934. For the purpose of assessment

of performance of banks, the Reserve Bank of India categorize them as public sector banks, old private sector banks, new private sector banks and foreign banks.

Business Divisions
Retail banking - Loans to Individuals (Auto loan, Housing Loan, Education Loan and other personal loan) or small businesses. Wholesale banking Loans to Mid and Large corporate (Working Capital loans, Project finance, Term loans, Lease Finance) Treasury Operations Investment in Equity, Derivates, Commodities, Mutual Funds, Bonds,Trading and Forex operations Other Banking Businesses Merchant Banking, Leasing business, Hire purchase, Syndication services etc. SWOT ANALYSIS

Valuable contributor to GDP Regulatory environment Government Support

Increasing NPA Low penetration Lack of product differentiation



Modern Technology Untapped Rural Market Globalization

Unorganized money lending market Customer dissatisfaction Rise of monopolistic structures


Banking is mainly a client oriented business. A highquality of services to the client is crucial for the growth and stability of any bank. A wider distribution and access of financial services helps both consumers and producers to raise their welfare and productivity. Such access is especially powerful for the poor as it

provides them opportunities to build savings, make investments, avail credit, and more important, insure themselves against income shocks and emergencies. To survive in an increasingly competitive environment, bank need to come up with various facilities like Internet banking, mobile banking etc. With the onset of mobile banking, the industry finds itself at the threshold of the next major technological leap.

Buyer Power - High bargaining power of customers on account of banks renders uniform services to the clients. Now a days almost all banks would like to provide requisite information very easily by way to Internet, Mobile banking to the clients. Supplier Power- Low bargaining power of suppliers on account of RBI regulatory benchmarks. Banks have to meet numerous regulatory standards created by RBI. Competitive Rivalry- High competition of account of number of prominent public, private, foreign along with cooperative banks Availability of Substitutes - High menace from substitutes like NBFCs, Mutual funds, Government securities and T-bills. Threat of new entrants - Low threat of new entrants on account of banking regulations. Before setting up of a new bank, it is essential to take the consent of RBI.

The empirical studies have found a strong relationship between economic growth and financial development. Finance plays an important role in the economic growth. The charts depict the performance of Bankex in last 10 year and Relative performance of BSE Bankex & BSE Sensex in 2010-11. The performance of Bankex accelerated during the period March 2002 to March 2008. The performance of bankex decelerated during March 2008 March 2009 but thereafter it has shown increasing trend till March 2011. The four-month period (November 2010-February 2011) was marked by a consistent decline in all the indices caused by a number of global and domestic developments. The Sensex declined by 12.4%, while the Bankex Index declined by 18.3%.

Some of the global factors, such as increase in crude oil prices and high commodity prices contributed to inflation in the domestic economy. High inflation coupled with low growth rate in the Index of Industrial Production (IIP) and tightening interest rates has caused some concerns over the short-term economic growth, hitting the stocks in all the sectors, particularly those in the financial services sector.

In recent years, Deposit, which constitutes 78 per cent of total liabilities of the banking sector has registered higher growth. The higher growth in deposits emanated mainly from term deposits. The accelerated growth in term deposit could be as a result of higher interest rate environment. The Deposit and Borrowings chart depicts that the dependence of foreign banks and new private sector banks on borrowings was relatively high as compared with other bank groups.

The other vital factors which determine the profitability of banking sectors are net interest margin (NIM), operating expenses and other income. Net Interest Margin (NIM) is used to assess efficiency of the banking sector. In India, during the last one decade, NIM was in

the range 2.5 per cent to 3.1 per cent. The NIM of the Indian banking sector continues to be higher than some of the emerging market economies of the world.

The asset quality of Indian banks has improved dramatically over the past 15 years. The gross NPA has reduced from 15.7% in March 1997 to 2.25 % in March 2011. The improvement in asset quality was visible in private sector banks and foreign banks. The asset quality of Public sector banks witnessed deterioration in 2010-11 owing to deterioration in asset quality of the SBI group. Agricultural sector contributed 44 per cent of the total incremental NPAs of domestic banks in 2010-11. GLOBAL BANKING TRENDS The Global financial crisis makes significant changes in the operating framework of banks. The performance of banks improves owing to strong lending growth and low credit losses. The present global macro-economic situation is differentiated by an unbalanced economic recovery across advanced and emerging economies, high levels of unemployment, inflationary pressures, and elevated levels of government debt. The Return on Assets (RoA), an indicator of banking systems profitability and soundness showed a moderate increase in the US and France in 2010. The RoA of US banks turned positive by 2010 after staying in the negative zone in 2008 and 2009; it showed a further increase in 2011. The RoA of Indian banks showed a modest rise between 2008 and 2010.

PUBLIC SECTOR State Bank of India (SBI) State Bank of India is the largest banking and financial services company in India. In addition to the banking services, the Bank through their subsidiaries, provides a range of financial services, which include life insurance, merchant banking, mutual funds, credit card, factoring, security trading, pension fund management and primary dealership in the money market. The State Bank Group, with over 16,000 branches, has the largest banking branch network in India. The bank has 131 overseas offices spread over 32 countries. The bank offers convenience of over 21000 ATMs in India. The bank has recorded tremendous growth in Net Interest Income. The Net Interest Income has registered a growth of 37.41% from Rs.23,671.44 crores in 2009-10 to Rs. 32,526.41 crores in 2010-11on account of growth in interest income on advances and investments. The total assets of the bank increased by 16.17% from Rs.10,53,413.73 crores at the end of March 2010 to Rs. 12,23,736.20 crores as at end March 2011.

Punjab National Bank (PNB) Punjab National Bank is one of the big four banks of India. PNB is ranked as the 2nd largest bank in the country after SBI in terms of branch network, business and many other parameters. They are recognized as the bank offering highest levels of customer satisfaction in Delhi and Chennai. The bank has a wide network of 5189 branches which comprise of 2047 Rural, 1154 Semi Urban, 1111 Urban and 877 Metropolitan branches at the end of March 2011. During FY 2010-11, with 39.16% share of CASA to domestic deposits, the Bank achieved a net profit of Rs 4433 crore.Bank has a strong capital base with capital adequacy ratio of 12.42% as on Mar11 as per Basel II with Tier I and Tier II capital ratio at 8.44% and 3.98% respectively. As on March11, the Bank has the Gross and Net NPA ratio of 1.79% and0.85% respectively. The Bank's total deposits amounted to Rs 3, 12,899 crore at the end of March' 2011, showing an absolute accretion of Rs. 63,569 crore and a growth of 25.5% over previous year. Ratio of Gross NPAs to Gross Advances stood at 1.79% at the end of March' 2011, while the ratio of Net NPAs to Net Advances was 0.85%.

Canara Bank Canara Bank with headquarter in Bangalore operates in four segments, namely treasury operations, retail banking operations, wholesale banking operations and other banking operations. The bank has a branch network of 3257 including 4 overseas branches as on March 31, 2011. The Net profit recorded a 33.25% growth of Rs. 4026 crore in FY 11 compared with Rs.3021 crore in FY 10. The Total Deposits registered a growth of 25.3% to reach Rs.293973 crore as at March 2011 compared to Rs.234651 crore a year ago. The Cost of Deposits has decreased from 6.12 in FY 10 to 5.80 in FY 11. The CASA deposits grew by 21.8% to reach Rs. 83117 crore as at March 2011. The net interest margin has improved by 32 bps from 2.80 in FY 10 to 3.12 in FY 11.

Private Banks ICICI Bank ICICI Bank Ltd is the second largest private sector bank in India by market capitalization. They are a publicly held banking company engaged in providing a wide range of banking and financial services including commercial banking and treasury operations. The Bank has a network of 2,752 branches and 8,003 ATMs in India, and has a presence in 19 countries, including India. The net profit for fiscal 2011 was Rs. 5151.38 crore, representing a 28% increase over the previous year because of decrease in provisions and contingencies. The net interest income has increased by 11% from Rs. 8114 crore in fiscal 2010 to Rs. 9017 crore in fiscal 2011. The total advances grew by 19.4% in fiscal 2011 on account of strong growth in domestic corporate advances. The return on assets improved substantially to 1.34% in fiscal 2011 from 1.13% in the previous year. The total deposits have increased by 11.7% from Rs. 202016.60 crore at March 31, 2010 to Rs. 225602.11 crore at March 31, 2011. The proportion of current and savings account deposits in total deposits had increased from 28.7% at March 31, 2009 to 45.1% at March 31, 2011. The net non-performing asset ratio has reduced from 1.87% at March 31, 2010 to 0.94% at March 31, 2011. The capital adequacy position continued to be very strong, with total capital adequacy of 19.5% and Tier-1 capital adequacy of 13.2%


HDFC Bank Ltd is a major Indian financial services company based in Mumbai. The Bank has an enviable network of 1986 branches in 996 Indian cities and 5471 ATMs during the year 2010-11. The company has recorded an increase of 33% in net profit for FY 2011 of Rs. 3926 crore over the previous year. The Capital Adequacy Ratio (CAR) stood at 16.2% as against the regulatory minimum of 9.0%. Of this, Tier I CAR was 12.2% as on March 31, 2011. The total deposits have increased by 24.6% at Rs. 208586 crore and the total advances were increased by 27% to Rs. 159983 crore over March 31, 2010. The Net interest income grew by 25.7% mainly on account of acceleration in loan growth. The proportion of core current and savings deposits (CASA) to total deposits continued to be healthy at 51% as on March 31, 2011.

Axis Bank AXIS Bank is one of the fastest growing banks in private sector. The bank operates in four segments, namely treasury, retail banking, corporate/ wholesale banking and other banking business. The bank has a very wide network of around 1390 branches and 6,270 ATMs. The net profits have grown at a CAGR of 47.52% during last 5 years. The bank reported a net profit of Rs. 3,388.49 crores for the year ended March 31, 2011 over the net profit of Rs. 2,514.53 crores in the previous year. The Net Interest Income increased by 31.14% to Rs. 6,562.99 crores in FY 11 from Rs. 5,004.49 crores in FY 10.

The bank maintain a healthy asset-quality with a ratio of Gross NPAs to gross customer assets of 1.01% compared to 1.13% in previous year and a Net NPA ratio of 0.26% compared to 0.36% in FY 10. The deposit and advances has increased by 33.93% and 36.48% respectively. The Capital Adequacy Ratio under Basel II stood at 12.65% in FY 11 against 15.80% in FY 10.

CONCERN Indian economy is one of the fastest growing economies of the world. The economy with its varied geography and demography has specific requirements in order to traverse to the next orbit and attain its full potential. Banks enable to cope with finance requirement for few industries such as Infrastructure, Housing, Real Estate etc. Indias infrastructural financing needs are not only huge but also vital. Traditionally banks have been the major source of infrastructure financing and their exposure to infrastructure is already high at 17 per cent. There are several major concerns which are noted below. Intensifying competition Indian banking industry has undergone qualitative changes due to banking sector reforms. Indian banking sector, which is dominated by state-controlled banks, has been facing formidable challenges. Due to this new emerging competition, Indian banks, especially PSBs, are trying their best to improve their performance and preparing to compete in the emerging global market. New private sector banks and foreign banks have more customercentric policies, high quality services, new attractive schemes and computerized branches. All these services attracted more and more customers to their banks. In this context, there is a need to examine the efficiency of public sector banks operating in India. Mainly, competition can intensify and banks will become more efficient. The transaction cost of customers could come down and a bank which is efficient, nimble and customer focused would always be able to do better than others. As a result of globalization, many new banks have entered the Indian banking industry, further intensifying the competition.

Increasing NPA The asset quality of banks is one of the most important indicators of their financial health. It also reflects the efficacy of banks credit risk management and the recovery environment. The Indian banks have shown very good performance as far as the financial operations are concerned. But Non-performing Assets (NPA) has caused some concerns. Despite write-offs, gross NPAs have continued to rise significantly. The new accretion to NPAs has been much faster than the reduction in existing NPAs due to lower levels of upgradation and recoveries. To improve the banks ability to manage their non-performing assets (NPAs) and restructured accounts in an effective manner and considering that almost all branches of banks have been fully computerized, the Reserve bank of India in its Monetary Policy Statement 2012-13 proposed the following measures: To mandate banks to put in place a robust mechanism for early detection of signs of distress, and measures, including prompt restructuring in the case of all viable accounts wherever required, with a view to preserving the economic value of such accounts; and To mandate banks to have proper system generated segmentwise data on their NPA accounts, write-offs, compromise settlements, recovery and restructured accounts. Despite these concerns, it is projected that the Indian banking industry will grow through leaps and bounds looking at the huge growth potential of Indian economy. High population base of India, rising disposable income, etc. will drive the growth of Indian banking industry in the long-term. BUDGET 2012-13 The financial market performance is often considered as a barometer of the economy. The Banking system is the dominant life-line of the financial market. The budget 2012-13 was largely positive for the banking sector. Though no major announcements were made, the Finance Minister target to reduce fiscal deficit will indirectly benefit the sector as it will lead to reduced inflation which in turn will lead to a reduction in policy rates. Budget 2012 13 has proposed that individual tax payers be allowed tax deductions of up to Rs 10,000 on interests that they earn from their saving deposits. This proposal may give some boost to current and savings accounts (CASA) deposits. Any increase in these deposits will positively impact the net interest margins of banks. The other major announcement is to set aside Rs 15,888 crore for recapitalization of public sector bank and the target for agricultural credit raised by Rs. 1,00,000 crore to Rs. 5,75,000 crore. PEST ANALYSIS


MONETARY POLICY Monetary policy becomes more restrictive over the past years. Inflation has remained a policy headache for the government and the central bank for the past two years. Inflation was a primary concern among the policy makers during 2010-11. Inflation, which remained at elevated levels for a large part of FY11, was largely driven by food and fuel items and later on transmitted to manufacturing products to become a general phenomenon. The average inflation rate in India was 7.99% between 1969 and 2010.
The Reserve Bank of India (RBI) in its annual monetary policy for 2012-13 on March 17, 2012 slashed the policy rates by 50 basis points. The repo rate at which banks borrow money from the RBI now stands at 8% from 8.50% earlier. Similarly, the reverse repo rate at which RBI borrows money from banks is now at 7% from 7.50% earlier. The cash reserve ratio (CRR) was left unchanged at 4.75%.

The Reserve Bank of India reduced the Cash Reserve Ratio (CRR) by 75 basis points from 5.5% to 4.75 % with effect from March 10, 2012. This reduction will inject around Rs.48,000 crore of primary liquidity into the banking system to ensure smooth flow of credit to productive sectors of the economy. Earlier, RBI in its third quarter review in January 2012 reduced the CRR by 50 basis points from 6% to 5.5% injecting a liquidity of Rs.31,500 crore into the banking system to mitigate the tight liquidity conditions, which was the first move in the CRR since it was increased to 6% in April 2010.

REGULATION The expected integration of various intermediaries in the financial system would require a strong regulatory framework. It would also require a number of legislative changes to enable the banking system to remain contemporary and competitive.

ECONOMIC ANALYSIS The Indian economy has recorded remarkable growth over the past decade. India's economic growth is expected to robust in 2012 and 2013. The International Monetary Fund (IMF) has pared Indias economic growth projection to 6.9% in 2012 from its January estimate of 7%, the only emerging economy for which it has done so. Banks provide capital formation to various sectors which directly help in the growth of Indian economy. SOCIAL ANALYSIS Indian banking system has been progressing rapidly. There are ample opportunities for the banks to cover untapped rural market. Yet, banking facilities are not available in many rural areas. Many farmers are taking loan from moneylender at a very high rate of interest. Small-scale industries would remain important for banks. Changes could be expected in near future for unorganised sectors. TECHNOLOGICAL ANALYSIS In recent time, Indian banking industry has been consistently working towards the development of technological changes and its usage in the banking operations for the improvement of their efficiency. With the application of new and improved technologies banks expected to reduce costs, time and give customer satisfaction. Core banking has changed the face of banking by offering value added services. Core banking applications helps to provide complete front and backend automation of banks. Technological developments would render flow of information and data faster leading to faster appraisal and decision-making. This would enable banks to make credit management more effective, besides leading to an appreciable reduction in transaction cost. Internet banking or banking via the Internet can be considered a remarkable development in the banking sector. The ability to carry out banking transactions through the Internet has empowered customers to execute their

financial transactions within the comfort of their homes and offices. In todays busy world, when people do not have much time even for personal work, Internet banking appears as a boon. Internet Banking helped give the customer's anytime access to their banks. But for Internet banking there is a requirement of a PC / Laptop with an Internet connection. Mobile usage has seen an explosive growth in economies like India. India has reached 893.84 million mobile subscriber mark (Source: TRAI, Dec 2011) for a population of 1.21 billion. With Mobile Banking, customer can check their account balance, transfer funds 24 x 7, bills payments, booking of bus / flight tickets, recharge prepaid mobile and do a lot more effortlessly and securely. Banking through cell phone benefits the banks too. It cuts down on the cost of tele-banking and is more economical. ATM (Automated Teller Machine) is electronic machine, which is operated by a customer himself to deposit or to withdraw cash from bank. ATMs reduce the work pressure on bank's staff and avoid queues in bank premises. ATMs are of great help to travelers. They need not carry large amount of cash with them. CONCLUSION The financial sector reforms have brought about significant improvements in the financial strength and the competitiveness of the Indian banking system. The prudential norms, accounting and disclosure standards, risk management practices, etc are keeping pace with global standards, making the banking system resilient to global shocks. In the recent past, the Indian banking sector has undergone significant developments and investments. In this sector, there are huge opportunities and numerous challenges. Money laundering is a growing menace and it not only poses serious threat to the stability and integrity of the financial system but also to the sovereignty and safety of nations worldwide. In the coming days, challenges before banks would primarily lie in saving themselves from the growing threat of money laundering.

CUSTOMER AND CUSTOMER SATISFACTION Customer is defined as anyone who receives that which is produced by the individual or organization that has value. Customer expectations are continuously increasing. Brand loyalty is a thing of the past. Customers seek out products and producers that are best able to satisfy their requirements. A product does not need to be rated highest by customers on all dimensions, only on those they think are important. Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business. In a competitive marketplace where businesses compete for customers, customer

satisfaction is seen as a key differentiator and increasingly has become a key

element of business strategy.There is a substantial body of empirical literature that establishes the benefits of customer satisfaction for firms. It is 5 times more expensive to acquire a new customer than to retain an old one. Good customer support is crucial when it comes to retaining customers and driving more sales, but how do operations deliver exceptional service to ensure 100% satisfaction and loyalty. This Ziff Davis white paper explores the relationship between customer retention and the quality of technical support and reveals 12 crucial remote-support tools that enable your team to boost customer satisfaction. Customer Satisfaction is a Critical Component of Profitability. Exceptional customer service results in greater customer retention, which in turn results in higher profitability. Sadly, mature companies often forget or forsake the thing that made them successful in the first place: a customer-centric business model. They lose focus on the customer and start focusing on the bottom line and quarterly results. They look for ways to cut costs or increase revenues, often at the expense of the customer. They forget that satisfying customer needs and continuous value innovation is the only path to sustainable growth. This creates opportunities for new, smaller companies to emulate and improve

upon what made their bigger competitors successful in the first place and steal their customers. Measuring customer satisfaction To execute a successful client satisfaction survey, build one that your customers have the time and inclination to respond to, and that delves into the types of information that will truly help enhance your performance. By carefully constructing a brief, yet strong, survey, you can discover what your customers believe your strengths and weaknesses are and what makes your customers loyal to your company Organizations are increasingly interested in retaining existing customers while targeting non-customers; measuring customer satisfaction provides an indication of how successful the organization is at providing products and/or services to the marketplace. Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other options the

customer may have and other products against which the customer can compare the organization's products. Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative measurement, although a large quantity of research in this area has recently been developed. Work done by Berry (Bart Allen) and Brodeur between 1990 and 1998 defined ten 'Quality Values' which influence satisfaction behavior, further expanded by Berry in 2002 and known as the ten domains of satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front line Service Behaviors, Commitment to the Customer Innovation.

These factors are emphasized for continuous improvement and organizational change measurement and are most often utilized to develop the architecture for satisfaction measurement as an integrated model. Work done by Parasuraman, Zeithaml and Berry (Leonard L) between 1985 and 1988 provides the basis for the measurement of customer satisfaction with a service by using the gap between the customer's expectation of performance and their perceived experience of performance. This provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Work done by Cronin and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman, Zeithaml and Berry as two different measures (perception and expectation of performance) into a single measurement of performance according to expectation. According to Garbrand, customer satisfaction equals perception of performance divided by expectation of performance. The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. The customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being measured. Customer satisfaction with a company's products or services is often seen as the key to a company's success and long-term competitiveness. In the context of relationship marketing, customer satisfaction is often viewed as a central determinant

of customer retention. However, the few empirical investigations in this area indicate that a direct relationship between these constructs is weak or even nonexistent. Customer satisfaction models American Customer Satisfaction Index (ACSI) is a scientific standard of customer satisfaction. Academic research has shown that the national ACSI score is a strong predictor of Gross Domestic Product (GDP) growth, and an even stronger predictor of Personal Consumption Expenditure (PCE) growth. On the microeconomic level, research has shown that ACSI data predicts stock market performance, both for market indices and for individually traded companies. Increasing ACSI scores has been shown to predict loyalty, word-of-mouth recommendations, and purchase behavior. The ACSI measures customer satisfaction annually for more than 200 companies in 43 industries and 10 economic sectors. In addition to quarterly reports, the ACSI methodology can be applied to private sector companies and government agencies in order to improve loyalty and purchase intent. Two companies have been licensed to apply the methodology of the ACSI for both the private and public sector: CFI Group, Inc.applies the methodology of the ACSI offline, and Foresee Results applies the ACSI to websites and other online initiatives The Kano model is a theory of product development and customer satisfaction developed in the 1980s by Professor Noriaki Kano that classifies customer

preferences into five categories: Attractive, One-Dimensional, Must-Be, Indifferent, Reverse. The Kano model offers some insight into the product attributes which are perceived to be important to customers. Kano also produced a methodology for mapping consumer responses to questionnaires onto his model. SERVQUAL or RATER is a service-quality framework that has been incorporated into customer-satisfaction surveys (e.g., the revised Norwegian Customer Satisfaction Barometer[5]) to indicate the gap between customer expectations and experience. J.D. Power and Associates provides another measure of customer satisfaction, known for its top-box approach and automotive industry rankings. J.D. Power and Associates' marketing research consists primarily of consumer surveys and is publicly known for the value of its product awards. Other research and consulting firms have customer satisfaction solutions as well. These include A.T. Kearney's Customer Satisfaction Audit process[6], which incorporates the Stages of Excellence framework and which helps define a companys status against eight critically identified dimensions. Improving customer satisfaction Published standards exist to help organizations develop their current levels of customer satisfaction. The International Customer Service Institute (TICSI) has released

The International Customer Service Standard (TICSS). TICSS enables organizations to focus their attention on delivering excellence in the management of customer service, whilst at the same time providing recognition of success through a 3rd Party registration scheme. TICSS focuses an organizations attention on delivering increased customer satisfaction by helping the organization through a Service Quality Model. TICSS Service Quality Model uses the 5 P's - Policy, Processes, People, Premises, Product/Services, as well as performance measurement. The implementation of a customer service standard should lead to higher levels of customer satisfaction, which in turn influences customer retention and customer loyalty ( However, the researches have proved that satisfaction is best specified as a function of perceived quality and "disconfirmation"-the extent to which perceived quality fails to match prepurchase expectations. Surprisingly, expectations do not directly affect satisfaction, as is often suggested in the satisfaction literature. In addition, quality which falls short of expectations has a greater impact on satisfaction and repurchase intentions than quality which exceeds expectations. Moreover, disconfirmation is more likely to occur when quality is easy to evaluate. Finally, in terms of systematic variation across firms, the elasticity of repurchase intentions with respect to satisfaction to be lower for firms that provide high satisfaction. This implies a longrun reputation effect insulating firms which consistently provide high satisfaction.

Seven steps to customer satisfaction1 It's a well known fact that no business can exist without customers. In the business of Website design, it's important to work closely with your customers to make sure the site or system you create for them is as close to their requirements as you can manage. Because it's critical that you form a close working relationship with your client, customer service is of vital importance. What follows are a selection of tips that will make your clients feel valued, wanted and loved. 1. Encourage Face-to-Face Dealings This is the most daunting and downright scary part of interacting with a customer. If you're not used to this sort of thing it can be a pretty nerve-wracking experience. Rest assured, though, it does get easier over time. It's important to meet your customers face to face at least once or even twice during the course of a project. My experience has shown that a client finds it easier to relate to and work with someone they've actually met in person, rather than a voice on the phone or someone typing into an email or messenger program. When you do meet them, be calm, confident and above all, take time to ask them what they need. I believe that if a potential client spends over half the meeting doing the talking, you're well on your way to a sale.

Adrian Thompson posted on February 11th, 2002


Respond to Messages Promptly & Keep Your Clients Informed This goes without saying really. We all know how annoying it is to wait days for a

response to an email or phone call. It might not always be practical to deal with all customers' queries within the space of a few hours, but at least email or call them back and let them know you've received their message and you'll contact them about it as soon as possible. Even if you're not able to solve a problem right away, let the customer know you're working on it. A good example of this is my Web host. They've had some trouble with server hardware which has caused a fair bit of downtime lately. At every step along the way I was emailed and told exactly what was going on, why things were going wrong, and how long it would be before they were working again. They also apologised repeatedly, which was nice. Now if they server had just gone down with no explanation I think I'd have been pretty annoyed and may have moved my business elsewhere. But because they took time to keep me informed, it didn't seem so bad, and I at least knew they were doing something about the problems. That to me is a prime example of customer service.


Be Friendly and Approachable It's very important to be friendly, courteous and to make your clients feel like

you're their friend and you're there to help them out. There will be times when you want to beat your clients over the head repeatedly with a blunt object - it happens to all of us. It's vital that you keep a clear head, respond to your clients' wishes as best you can, and at all times remain polite and courteous. 4. Have a Clearly-Defined Customer Service Policy This may not be too important when you're just starting out, but a clearly defined customer service policy is going to save you a lot of time and effort in the long run. If a customer has a problem, what should they do? If the first option doesn't work, then what? Should they contact different people for billing and technical enquiries? If they're not satisfied with any aspect of your customer service, who should they tell? There's nothing more annoying for a client than being passed from person to person, or not knowing who to turn to. Making sure they know exactly what to do at each stage of their enquiry should be of utmost importance. So make sure your customer service policy is present on your site -- and anywhere else it may be useful. 5. Attention to Detail Have you ever received a Happy Birthday email or card from a company you were a client of? Have you ever had a personalised sign-up confirmation email for a service

that you could tell was typed from scratch? These little niceties can be time consuming and aren't always cost effective, but remember to do them. Even if it's as small as sending a Happy Holidays email to all your customers, it's something. It shows you care; it shows there are real people on the other end of that screen or telephone; and most importantly, it makes the customer feel welcomed, wanted and valued. 6. Anticipate Your Client's Needs & Go Out Of Your Way to Help Them Out Sometimes this is easier said than done! However, achieving this supreme level of understanding with your clients will do wonders for your working relationship. Your client is heartily impressed, and remarks to his colleagues and friends how very helpful and considerate his Web designers are. Meanwhile, in your office, you lay back in your chair drinking your 7th cup of coffee that morning, safe in the knowledge this happy customer will send several referrals your way. 7. Honour Your Promises It's possible this is the most important point in this article. The simple message: when you promise something, deliver. The most common example here is project delivery dates.

Clients don't like to be disappointed. Sometimes, something may not get done, or you might miss a deadline through no fault of your own. Projects can be late, technology can fail and sub-contractors don't always deliver on time. In this case a quick apology and assurance it'll be ready ASAP wouldn't go amiss.


STRENGTHS The biggest strength of Bank is Direct Banking channels. As Direct banking channels saves time and money both as a customer does not need to go to bank for any kind of transaction except cash withdrawal and cash deposits all other things are done sitting any where in the world. All services or products of HDFC Bank are available through direct banking channels. Free ATM, Net Banking, Mobile Banking, Phone Banking and 24 hours services. Very easy to access and use. A highly personalized services provided by the bank. HDFCs Direct Banking channels provide real time and accurate information. HDFCs Direct Banking is user friendly any one can easily operate it.

Now International Debit Card is Free for one year. The Bank has strategic business alliance with Chase Manhattan Bank, largest bank of USA.

WEAKNESSES Unawareness among customers about all Direct Banking Channels due to less advertisement. Other private banks have started direct banking channels it may put some competition to HDFC Bank in near future. Resistance to Change. One should have the knowledge of the operations of the computers and of course the Internet. OPPORTUNITIES As Nationalized Banks and Co-operative Banks do not provide Direct Banking services, so HDFC Bank can attract more customers. Centralized banking makes easy for HDFC Bank to provide services to customers. Huge market of shareholders. THREATS Competition from other private sector banks. Attacks of web hackers. Personalized attention i.e. relationship banking should be reduced, thus by creating a distance between the bank and its customers.


Research means search for facts, answers to questions and solutions to problems and Methodology is a way of doing something and methodology is a set of methods used in a particular area of activity. The purpose of our study is to evaluate the customers response towards the study of the difference between the services given by the public bank and private bank. This is an informative survey as it evaluates the customers of the both banks.

RESEARCH DESIGN Research design constitutes the blue print for the collection, measurement and analysis of data. The present study seeks to identify the extent of preference among customers for services of HDFC bank. The research has been conducted on users of the city Pathankot. For the selection of the sample, convenient sampling method was adopted and an attempt has been made to include all the age groups and gender DATA SOURCES Both primary and secondary data has been used to achieve the objectives of the study. All data sources are not created equal. Some reference material has more value than others do This does not mean that value equals a greater quantity of information. The actual value involves the quality of the information provided. Sources of data can be put

into the two general categories of being either primary or secondary. A primary data source is something that originates from first-hand knowledge of the person referenced in the data or from a first-hand witness. I collect this type of data through questionnaires that were filled by the respondents. Secondary data is data that is neither collected directly by the user nor specifically for the user, often under conditions not known to the user. Secondary information has already been collected for some other purposes. Keeping in mind the objectives of the study, the primary data was collected from a sample of 100 respondents belonging to Pathankot who were HDFC bank customers by personally administering the questionnaire. A structured questionnaire was designed as per the objectives of the study. The questionnaire contained questions relating to different dimensions of banking services preferences among the users such as level of usage, benefits accruing to the users of the services and the benefits they get out of it. An attempt was also made to elicit reasons for its non usage. The questions included in the questionnaire offered multiple choices. The data so collected was analysed and interpreted. Analysis of Data and discussion Data so collected was tabulated, analysed and interpretation has been carried out with the help of tables.

LIMITATIONS OF THE STUDY The following were the limitations of the study: 1) The study was limited to one city only hence the findings of the study cannot be generalised. 2) The sample size was limited to 100 respondents. Hence, the findings may vary due to change in the size of the sample. 3) The reliability of the data depends upon the responses given by the respondents. 4) Sometimes, the respondents show casual attitude towards questionnaires which may affect the findings of the study.


The data collected was in the raw form. Therefore, it had to be tabulated, analysed and then interpreted in order to get meaningful information from the study. 1) Preference for HDFC bank in opening an account. Reason Efficient service Convenient location Acquaintance Others Total No. of respondents Percentage 66 16 14 4 100 66 16 14 4 100

%age of respondents

70 60 50 40 30 20 10 0



14 4

Efficient service

Convenient location




The survey reveals that 66% respondents prefer HDFC bank for opening the account due to efficient service. 16% respondents prefer this bank because of its convenient location. 14% respondents open account because of acquaintance with the bank officers. 2) Whether the bank solves or replies to your queries quickly.

Response Yes No Total

No. of respondents Percentage 96 4 100 96 4 100





96% respondents say that the bank solve the queries of the customer quickly whereas 4% respondents say that the bank does not solve the queries quickly.


Whether the bank provides better utility services.

Response Yes No Total

No. of respondents Percentage 86 14 100 86 14 100

14% 86%



86% respondents say that the bank provides better utility services as compare to other banks while the remaining 14% of the respondents feel that the bank does not provide better services.


Whether the staff is cooperative in the bank

Response Yes No Total

No. of respondents Percentage 95 5 100 95 5 100





The survey reveals that 94% respondents believe that the staff of the bank is more cooperative as compare to other banks and the remaining 6% respondents do not feel that the bank staff is cooperative.


Whether Loan is available at lower interest rate in the bank

Response Yes No Total

No. of respondents Percentage 79 21 100 79 21 100

21% 79%



the survey reveals that 79% respondents feel that the bank offer loans at lower interest rate as compared to other banks whereas 21% respondents feel that the loans are not cheaper in this bank.


Rate the bank on the scale of your satisfaction level

Rating Very good Good Average Poor Total

No. of respondents Percentage 46 49 5 0 100 46 49 5 0 100

%age of respondents

50 40 30 20 10 0



5 0 Very good Good Average Poor

Rating of Satisfaction Level

The survey reveals that 49% of the respondents are satisfied with the bank services and feel that the bank is good while 46% are highly satisfied and feel that the bank is very good. 5% respondents are not highly satisfied.


Time taken by the bank to open the account

Time taken Less than a day 1 to 3 days More than 3 days Total

No. of respondents Percentage 77 23 0 100 77 23 0 100

90 80
%age of respondents


70 60 50 40 30 20 10 0 Less than a day 1 to 3 days More than 3 days

Time taken to open an account


The survey reveals that 77% respondents say that the bank takes less than 1 day to open the account. 23% respondents say that the bank takes 1 to 3 days to open the account.


Time taken by bank to accept cash deposits or pay cash Time taken Less than 5 min 5 to 10 min More than 10 min Total No. of respondents Percentage 50 36 14 100 50 36 14 100

%age of respondents

50 50 40 30 20 10 0 Less than 5 min 5 to 10 min More than 10 min

Time taken to deposit or pay cash



50% respondents say that the bank takes less than 5 min to deposit or pay cash 36% respondents say that the bank takes 5-10 min to deposit or pay cash whereas 14% respondents say that the bank takes more than 10 min for deposit or pay cash.


Would you suggest this bank to others for banking services?

Response Yes No Total

No. of respondents Percentage 100 0 100 100 0 100





All the respondents (100%) say that they would suggest others to open account in the bank. None of the respondents said against the bank.


Whether grievance-handling procedure in this bank is faster.

Response Yes No Total

No. of respondents Percentage 98 2 100 98 2 100





The survey reveals that 98% respondents say that grievance handling procedure is faster in the bank while 2% respondents say that the grievance handling procedure of other banks is good as compared to this bank.


Whether the bank satisfies all your financial needs

Response Yes No Total

No. of respondents Percentage 93 7 100 93 7 100

7% 93%



The survey reveals that 93% respondents are in the favour that this bank satisfies all the financial needs of the customers while the remaining 7% respondents feel that the bank does not fulfil all the financial needs.


Whether innovative services are given by the bank.

Response Yes No Total

No. of respondents Percentage 97 3 100 97 3 100





The survey reveals that 97% respondents are in favour that the bank provides the innovative services to the respondents whereas 3% respondents say that the bank gives less innovative services to the customers as compared to other banks.


66% respondents prefer HDFC bank for opening the account due to efficient service. 16% respondents prefer this bank because of its convenient location. 14% respondents open account because of acquaintance with the bank officers. 96% respondents say that the bank solve the queries of the customer quickly whereas 4% respondents say that the bank does not solve the queries quickly. 86% respondents say that the bank provides better utility services as compare to other banks while the remaining 14% of the respondents feel that the bank does not provide better services. 94% respondents believe that the staff of the bank is more co-operative as compare to other banks and the remaining 6% respondents do not feel that the bank staff is cooperative. 79% respondents feel that the bank offer loans at lower interest rate as compared to other banks whereas 21% respondents feel that the loans are not cheaper in this bank. 49% of the respondents are satisfied with the bank services and feel that the bank is good while 46% are highly satisfied and feel that the bank is very good. 5% respondents are not highly satisfied.

77% respondents say that the bank takes less than 1 day to open the account. 50% respondents say that the bank takes less than 5 min to deposit or pay cash 36% respondents say that the bank takes 5-10 min to deposit or pay cash. All the respondents (100%) say that they would suggest others to open account in the bank. None of the respondents said against the bank. 98% respondents say that grievance handling procedure is faster in the bank while 2% respondents say that the grievance handling procedure of other banks is good as compared to this bank. 93% respondents are in the favour that this bank satisfies all the financial needs of the customers while the remaining 7% respondents feel that the bank does not fulfil all the financial needs. 97% respondents are in favour that the bank provides the innovative services to the respondents whereas 3% respondents say that the bank gives less innovative services to the customers as compared to other banks. From the above, it can be concluded that most of the respondents are aware of the services given by the both banks either public or private. Only the educated

respondents are fully aware of the private banks services. Here, advertisement must play a major role in making both educated and uneducated customers aware of the services offered by the bank. Services given to the senior citizen must attract them.


The banks should come forward with meaningful advertisements and awareness campaigns to create awareness among customers regarding banking services and to make the banking sector popular among the uneducated masses. The automated systems should be simple to use, fast and user friendly. The services should be standardised so that wherever the solution is used the customer is familiar with the procedure followed. Customers should have ready sources of advice, whether this is through call centres, through publicity or through physical presence. Banking services must be designed to reduce the cost of transactions for the financial institution as much as to deliver value to the customer. However, banking services should give more and more benefits to the customers. Added-value services such as loyalty programmes, person-to-person transfers, airtime top up for mobile phones and government payments should be provided. Banks should offer banking services by the way of convenience and reach so that it should be popular among all the age groups.