Digital Banking – “The new age banking”

SUMMER INTERNSHIP PROJECT REPORT

SUBMITTED TOWARDS PARTIALFULFILLMENT OF
POST GRADUATE DIPLOMA IN MANAGEMENT
(Approved by AICTE)
ACADEMIC SESSION
2018-19

Submitted by
Student Name: Ayushi Gaba
Roll No: 18PGDM010
Batch: 2018-20

Company Guide Faculty Guide

Name: Mrs. Shradha Mishra Name :Dr. Chanchal Chhaterjee
Designation: Manager Designation: Associate Professor
Name of Company: HDFC Bank IMI KOLKATA

INTERNATIONAL MANAGEMENT INSTITUTE KOLKATA

2/4C, JUDGES COURT ROAD, ALIPORE
KOLKATA 700027
 ACKNOWLEDGEMENT

If words are considered to be the signs of gratitude then let these words convey the same.
At the completion of the summer internship, I would like to convey my heartfelt gratitude
to all those who provided me with the required guidance and an enriching opportunity
throughout. I would also like to thank

Dr. Chanchal Chatterjee for instituting this summer internship programme in the
curriculum which gave us a great industrial exposure which we never imagined. He not only
guided me but also helped me to carry out and complete this project successfully as per the
guidelines stated.

My sincere thanks to HDFC bank for providing me with an opportunity to work with the
bank and giving necessary directions on doing this project to the best of my abilities. I am
highly indebted to Mr. Suryanshu Verma & Mrs. Shradha Mishra who provided me with
the necessary information and also for the support extended out to me in the completion of
this report and valuable suggestions and comments on bringing out this report in the best
possible way.

I hereby also mention Miss Surbhi singh, Mr. Anurag Thakur, Mr. Saket kumar who also
provided me with necessary insights and details in the successful completion of the project
Digital Banking.

AYUSHI GABA
 CONTENTS

SN Contents Page
No.

1 Executive Summary
2 Introduction
3 Review of Literature/ Theoretical Background
4 Industry Overview
5 Research Methodology
6 Data Analysis , Results and
Interpretation/Findings

7 Conclusions
8 Recommendations
9 Biblography
 EXECUTIVE SUMMARY

Project Title-“Digital banking: The New Age Banking”

Duration: 2 months i.e from (2.04-2019-31.05.2019)
Name of the organization: HDFC BANK LTD.
Name of the organizational guide: Mr. Suryanshu Verma
Name of the Academic guide: Dr. Chanchal Chatterjee

OBJECTIVES OF THE STUDY:

(i) To understand the various concepts, features and how Banking system gets
evolved, traditional and digital/ E- Banking.
(ii) To study and analyse the progress made by Indian banks in adoption of technology
in the banking services, especially HDFC bank.
(iii) To understand the responses, views and understanding of the customers of
HDFC Bank and also the population in general views about the digital banking.
(iv) To analyze and study the popularity of the net banking service among the
customers of HDFC bank.
(v) To change the attitudes of customers to transact digitally rather than manually.
(vi) To make an analysis of the competition between HDFC bank and its competitors
with respect to digital banking features, advantages that HDFC bank has over the
other banks with respect to digital banking and vice versa

SCOPE OF THE STUDY

 The study would help the bank to understand the actual need of customers and
create new products to cater the needs of the commodity traders.
 The study would help to know the reasons why they are not using digital
banking services.
 The study would help us to know the level of satisfaction amongst customers.
 The study would also help HDFC bank to further improve the service
 The study would help to find the risk associated with digital banking services.
 The study would also help to access the contribution of digital banking.
LIMITATIONS OF THE STUDY
 Most of the customers were least interested due to their busy life.
 Most of the customers lacked knowledge about the things asked.
 Most of the customers were hesitant while answering the question.

RESEARCH METHODOLOGY
 Sources of data: Primary as well as secondary data are used.
 Research Instrument: Questionnaire
 Survey area :Ranchi.
 Research design : Explanatory and descriptive.
 Sample size:61
 Analysis technique: Table, pie-charts and bar diagrams.

RECOMMENDATIONS
 Banks should make some efforts to familiarize the customers with digital banking.
 Banks should try to make customers feel assure about the security of online banking
and warn them against fraudulent activities.
 Initiatives to make customers realize that future lies in digitalization.
 Designing simple and easy to use digital banking services so that it can cater to
different types of customers.
 Even though many customers claim that they use digital banking services but they do
not make full fledged use of its services. Since digital banking has much broader
scope so banks must take efforts to make it more popular among customers.
INTRODUCTION

Banks have always been in the forefront of harnessing technology to improve their products,
services and efficiency. They have been over a long time using electronic and
telecommunication networks for delivering a wide range of value added products and
services. The delivery channels include direct dial – up connections, private networks, public
networks etc and the devices include telephone, Personal Computers including the
Automated Teller Machines, etc. With the popularity of PCs, easy access to Internet and
World Wide Web (WWW), Internet is increasingly used by banks as a channel for receiving
instructions and delivering their products and services to their customers. This form of
banking is generally referred to as Internet Banking, although the range of products and
services offered by different banks vary widely both in their content and sophistication.

The Indian banking sector is undergoing a radical change from branch banking to digital
banking. Both public and private banks in association with government are presently
carrying out intense campaign to bring the users of banking system under digital banking
process. However, while over the last few years a large section of the customers have
adopted digital banking, many are still reluctant to do so.

Broadly, the levels of banking services offered through INTERNET can be categorized in to
three types: (i) The Basic Level Service is the banks’ websites which disseminate information on
different products and services offered to customers and members of public in general. It may
receive and reply to customers’ queries through e-mail, (ii) In the next level are Simple

Transactional Websites which allow customers to submit their instructions, applications for
different services, queries on their account balances, etc, but do not permit any fund-based
transactions on their accounts, (iii) The third level of Internet banking services are offered by
Fully Transactional Websites which allow the customers to operate on their accounts for
transfer of funds, payment of different bills, subscribing to other products of the bank and to
transact purchase and sale of securities, etc. The above forms of Internet banking services are
offered by traditional banks, as an additional method of serving the customer or by new
banks, who deliver banking services primarily through Internet or other electronic delivery
channels as the value added services.
REVIEW OF LITERATURE

Digital Banking may be stated as the adoption of various existing and emerging technologies
by the banks, in concert with associated changes in internal operations as well as external
relationships for providing superior customer services and experiences effectively and
efficiently. Today, aspects such as enhanced customer satisfaction and value through unified
customer experiences, faster output, infinite banking volumes, financial inclusion, operational
efficiencies, scale of economy etc. are being sought after, by leveraging digital banking.
Banks have already started evaluating the reduction in number and size of branches. In
addition, the investment in digital technology to replace more expensive human interactions
is also being considered. This includes, but not limited to, tablets for universal bankers,
automated teller machines and digital kiosks to facilitate account opening and customer
inquiries. There is also a shift from traditional banking to online banking system amongst
those who avail banking services. The primary reasons of this transfer are perceived usefulness,
perceived ease of use, security and privacy provided by online banking.

DIGITAL BANKING

Online banking, also known as internet banking, e-banking or virtual banking, is an

electronic payment system that enables customers of a bank or other financial institution to
conduct a range of financial transactions through the financial institution's website. E-
banking includes the systems that enable financial institution customers, individuals or
businesses, to access accounts, transact business, or obtain information on financial products
and services through a public or private network, including the Internet. Customers access e-
banking services using an intelligent electronic device, such as a personal computer (PC),
personal digital assistant (PDA), automated teller machine (ATM), kiosk, or Touch Tone
telephone. While the risks and controls are similar for the various e-banking access channels,
this booklet focuses Specifically on Internet-based services due to the Internet's widely
accessible public network. Some of the modes of E-Banking are:
a) Automated Teller Machines
b) Internet Banking
c) Mobile Banking
d) Phone Banking
e) SMS Banking etc.
FEATURES OF E-BANKING:
A) A bank customer can perform non-transactional tasks through online banking,
including –

1. Viewing account balances

2. Viewing recent transactions

3. Downloading bank statements, (for example in PDF format)

4. Viewing images of paid cheques.

5. Ordering cheque books

6. Download periodic account statements

7. Downloading applications for M-banking, E-banking etc.

B) Bank customers can transact banking tasks through online banking, including –

1. Funds transfers between the customer's linked accounts

2. Paying third parties, including bill payments (see, e.g., BPAY) and third-party fund
transfers (see, e.g., FAST)

3. Investment purchase or sale

4. Loan applications and transactions, such as repayments of enrolments

5. Credit card applications

6. Register utility billers and make bill payments

7. Financial institution administration

8. Management of multiple users having varying levels of authority

RELATIONSHIP OF HDFC AND DIGITAL BANKING

HDFC Bank’s digital banking is the online banking services offered by the bank to its largest
number of customers. This service can be accessed from anywhere any time allowing the
customers to control their funds. Moreover, it is completely safe as the bank utilizes the most
advanced technologies and infrastructures. HDFC provides a host of features such as view
a/c balances & statements, transfer funds between accounts, create fixed deposits online,
request a demand draft, pay bills, order a cheque book, request stop payment of a cheque,
apply for a personal loan or an auto loan or many more. Moreover, HDFC bank also offers to
their corporate clients E-Net, a fully secured internet based online, real time electronic
delivery channel, and providing convenient and secure access to their banking information
over the internet. E-Net allows multi-branch connectivity and can integrate with
heterogeneous core bank end system across branches in India. Hence, HDFC bank and
DIGITAL BANKING goes hand in hand where this bank is trying its best every-day to
transform itself completely to a digital banking platform by introducing various types of
digital services like net banking, phone banking, SMS banking, watch banking various
mobile banking applications like chillr application, payzapp and many more to come through
their technological innovations where its customers will carry out all their transactions online
through various digital products at their convenience and without even visiting the branch of
the bank. Therefore, digital banking is intertwined with HDFC bank which is aiming to
become a pioneer in providing financial services to its customers through digital channels.
BANKING INDUSTRY

Evolution Of Banking: The concept of Banking in India dates back to the first half of 18th
century. The first bank that was established in the country was The General Bank of India
founded in 1786. After that came the State Bank of India in Kolkata in 1806 which was then
known as The Bank of Bengal. The operations of all the banks in India are controlled by the
Reserve Bank of India. All the Indian banks are governed by the RBI or Reserve Bank of
India. This governing body took over the reasonability of formally regulating the Indian
banks in 1935. The Reserve Bank of India was announced as the official Central Banking
Authority for the smooth supervision of the banking industry in India. Banks in India are
classified into 2 broad categories namely, Public sector banks and Private sector banks. The
banking scenario in India has already gained momentum, with the domestic and international
banks gathering pace. All the banks in India are following the 'cost', determined by revenue
minus profit model. This means that all the resources should be used efficiently to improve
the productivity and ensure a win-win situation. To survive in the long run, it is essential to
focus on cost saving. Previously, banks focused on the 'revenue' model which is equal to cost
plus profit. Post the banking reforms, banks shifted their approach to the 'profit' model, which
meant that banks aimed at higher profit maximization. Thereafter, the Government of India
issued a law and nationalized the 14 largest business banks with effect from the midnight of
July 19, 1969. A second dose of nationalization came when 6 more commercial banks
followed in 1980. With this second dose of nationalization, the Government of India
controlled around 91% of the banking business of India.

Banking System: The structural network of institutions that offer financial services within a
country. The members of the banking system and the functions they typically perform
include: (1) commercial banks that take deposits and make loans, (2) investment banks
which specialize in capital market issues and trading, and (3) national central banks that issue
currency and set monetary policy. Accounting for trillions in assets worldwide, the banking
system is a crucial component of the global economy.
 COMPANY PROFILE

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 RBI's liberalisation 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.

Promoter

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, strong market reputation, large
shareholder base and unique consumer franchise, HDFC was ideally positioned to promote
a bank in the Indian environment.
Business 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 five core values:
Operational Excellence, Customer Focus, Product Leadership, People and Sustainability.

Amalgamation of times bank & centurion bank of punjab with hdfc bank

On May 23, 2008, the amalgamation of Centurion Bank of Punjab with HDFC Bank was
formally approved by Reserve Bank of India to complete the statutory and regulatory
approval process. As per the scheme of amalgamation, shareholders of CBoP received 1
share of HDFC Bank for every 29 shares of CBoP.
The malgamation added significant value to HDFC Bank in terms of increased branch
network, geographic reach, and customer base, and a bigger pool of skilled manpower. In a
milestone transaction in the Indian banking industry, Times Bank Limited (another new
private sector bank promoted by Bennett, Coleman & Co. / Times Group) was merged with
HDFC Bank Ltd., effective February 26, 2000. This was the first merger of two private banks
in the New Generation Private Sector Banks. As per the scheme of amalgamation approved by
the shareholders of both banks and the Reserve Bank of India, shareholders of Times Bank
received 1 share of HDFC Bank for every 5.75 shares of Times Bank.

Distribution Network

HDFC Bank is headquartered in Mumbai. As of March 31, 2015, the Bank’s distribution
network was at 4,014 branches in 2,464 cities.All branches are linked on an online real-time
basis. Customers across India are also serviced through multiple delivery channels such as
Phone Banking, Net Banking, Mobile Banking and SMS based banking. The Bank’s
expansion plans take into account the need to have a presence in all major industrial and
commercial centres, where its corporate customers are located, as well as the need to build a
strong retail customer base for both deposits and loan products. Being a clearing / settlement
bank to various leading stock exchanges, the Bank has branches in centres where the
NSE /BSE have a strong and active member base. The Bank also has
a network of 11,766 ATMs across India. HDFC Bank’s ATM network can be accessed by
all domestic and international Visa / MasterCard, Visa Electron / Maestro, Plus / Cirrus
and American Express Credit / Charge cardholders.

Management
Mrs. Shyamala Gopinath holds a Master’s Degree in Commerce and is a CAIIB. Mrs.
Gopinath has 39 years of experience in financial sector policy formulation in different
capacities at RBI. As Deputy Governor of RBI for seven years and member of the Board. Mrs.
Gopinath had been guiding and influencing the national policies in the diverse areas of
financial sector regulation and supervision, development and regulation of financial markets,
capital account management, management of government borrowings, forex reserves
management and payment and settlement systems.
The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years
and before joining HDFC Bank in 1994 was heading Citibank's operations in Malaysia.
The Bank's Board of Directors is composed of eminent individuals with a wealth of
experience in public policy, administration, industry and commercial banking. Senior
executives representing HDFC are also on the Board.

Senior banking professionals with substantial experience in India and abroad head various
businesses and functions and report to the Managing Director. Given the professional expertise
of the management team and the overall focus on recruiting and retaining the best talent in the
industry, the bank believes that its people are a significant competitive strength.

Technology
HDFC Bank operates in a highly automated environment in terms of information
technology and communication systems. All the bank’s branches have online connectivity,
which enables the bank to offer speedy funds transfer facilities to its customers. Multi-
branch access is also provided to retail customers through the branch network and
Automated Teller Machines (ATMs).

The Bank has made substantial efforts and investments in acquiring the best technology
available internationally, to build the infrastructure for a world class bank. In terms of core
banking software, the Corporate Banking business is supported by Flexcube, while the
Retail Banking business by Finware, both from i-flex Solutions Ltd. The systems are open,
scaleable and web-enabled.

The Bank has prioritised its engagement in technology and the internet as one of its key
goals and has already made significant progress in web-enabling its core businesses. In
each of its businesses, the Bank has succeeded in leveraging its market position, expertise
and technology to create a competitive advantage and build market share.

BUSINESS PROFILE
HDFC Bank caters to a wide range of banking services covering commercial and
investment banking on the wholesale side and transactional / branch banking on the retail
side. The bank has three key business segments:
Wholesale Banking

The Bank’s target market is primarily large, blue-chip manufacturing companies in the
Indian corporate sector and to a lesser extent, small & mid-sized corporates and agri-
based businesses. For these customers, the Bank provides a wide range of commercial and
transactional banking services, including working capital finance, trade services,
transactional services, cash management, etc. The bank is also a leading provider of
structured solutions, which combine cash management services with vendor and
distributor finance for facilitating superior supply chain management for its corporate
customers. Based on its superior product delivery / service levels and strong customer
orientation, the Bank has made significant inroads into the banking consortia of a number
of leading Indian corporates including multinationals, companies from the domestic
business houses and prime public sector companies. It is recognised as a leading provider
of cash management and transactional banking solutions to corporate customers, mutual
funds, stock exchange members and banks.

Treasury

Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the
liberalisation of the financial markets in India, corporates need more sophisticated risk
management information, advice and product structures. These and fine pricing on
various treasury products are provided through the bank’s Treasury team. To comply with
statutory reserve requirements, the bank is required to hold 25% of its deposits in
government securities. The Treasury business is responsible for managing the returns and
market risk on this investment portfolio.

Retail Banking

The objective of the Retail Bank is to provide its target market customers a full 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 world-class service and delivered
to customers through the growing branch network, as well as through alternative delivery
channels like ATMs, Phone Banking, NetBanking 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 a wide array of retail loan products including Auto Loans, Loans
against marketable securities, Personal Loans and Loans for Two-wheelers. It is also a leading
provider of Depository Participant (DP) services for retail customers, providing customers the
facility to hold their investments in electronic form.

HDFC Bank was the first bank in India to launch an International Debit Card in
association with VISA (VISA Electron) and issues the MasterCard Maestro debit card as
well. The Bank launched its credit card business in late 2001. By March 2015, the bank
had a total card base (debit and credit cards) of over 25 million. The Bank is also one of
the leading players in the “merchant acquiring” business with over 235,000 Point-of-sale
(POS) terminals for debit / credit cards acceptance at merchant establishments. The Bank
is well positioned as a leader in various net based B2C opportunities including a wide
range of internet banking services for Fixed Deposits, Loans, Bill Payments, etc.
Some highlights of HDFC bank

Products and Services

a) Accounts & Deposits
b) Loans
c) Cards
d) Investments
e) Insurance
f) Forex
g) Mutual Funds
h) Safe Deposit Lockers
i) Private Banking
j) NRI Banking
k) Premier Banking

DIGITAL BANKING PLATFORM:

HDFC Bank, one of the leading private sector lenders in India, has launched a new initiative -
'Bank Aap Ki Muththi Mein' - as part of their 'Go Digital campaign' that attempts to turn a
smartphone into a bank branch. The new HDFC Bank app allows over 75 banking
transactions, apart from essential transactions such as: booking fixed and recurring deposits,
bill and tax payments, buying insurance, and mutual funds, the app allows customers to buy
all kinds of loans instantly. It also provides customized, location-specific promotions, as well
as offers and deals on shopping, dining, movies, and entertainment. Notably, part of the
bank's 'Go Digital' offering, 'Bank Aap Ki Muththi Mein', is a technology agnostic initiative
with apps on the three popular smartphone platforms - iOS, Android, and Windows Phone.
The initiative also extends to basic feature-phone users with SMS and missed-call banking as
well as a mobile site. All that a customer needs to do is, send a text or call a toll-free number to
know his account balance, get a mini statement, request a check book, or detailed account
statement. The latter of course is a popular channel for a large number of rural and semi-urban
customers. The SMS banking service (and the Android app) is also available in Hindi for a
broader demographic. "With 'Bank Aap Ki Muththi Mein', you can do everything other than
access your locker, and deposit or withdraw cash. Customer convenience is central to our concept
of Digital. And, there is no bigger convenience than bringing your bank to the palm of your hand.
We are very excited to unveil our 'Bank Aap Ki Muththi Mein' offering and with it world class
experience of banking to millions of our countrymen," said Nitin Chugh, head - Digital Banking,
HDFC Bank. HDFC Bank, which began its digital journey by launching net banking services way
back in 1999, was the first to launch SMS banking in 2000.
The conversation with Nitin Chugh, head - Digital Banking, HDFC Bank, I learned that as of
2014, 55% of all transactions at HDFC Bank are conducted through digital channels, which is
significantly higher than the corresponding figure in 2001 of just 3%. Nitin asserted that the
campaign is essential since as of September 2014, India had over 900 million mobile users in the
country, but only 40 million mobile banking customers. "We want to be active partners in a new
digital India, envisioned by the government and central bank, offering our customers what they
want, when they want it. Customer convenience and centricity lies at the heart of all our digital
banking initiatives," he said, adding that even in rural India, technology will play a big role in
financial inclusion and bringing millions into the organized banking fold. 'Bank Aap Ki Muththi
Mein' allows customers to transact with the bank round-the-clock. While HDFC is not the only
bank to offer mobile banking services through various channels, it aims to trump the competition
with the widest array of capabilities it offers.

DIGITAL SERVICES:
a) Internet Banking.
b) Phone Banking.
c) Mobile Banking
d) SMS Banking.
e) Missed call Banking.
f) ATMs.
g) Watch Banking.
a)
b) Internet Banking: Now monitor, transact and control your bank account online with our
net banking service. You can do multiple things from the comforts of your home or office
through HDFC Net Banking your one stop solution for all your banking needs. Get all
account details, submit requests and undertake a wide range of transactions online through
our HDFC Bank Net Banking services. Our E-Banking service makes banking a lot more
easy and effective.
b) Phone Banking: Phone Banking offers you all the conveniences you need to access your
Accounts, Credit Cards, Loans, Demat & Investment Services from the comfort of your
home, office or on the move, all this in your preferred language. Phone Banking services
are a combination of IVR and Agent offering, depending on the type of transaction. For all
transactions that cannot be completed on the IVR, Phone Banker assisted services are
available. Following are the services offered- report loss of your ATM/ DEBIT/ CREDIT
card, check your account balance, enquire about cheque status, order a cheque book/account
statement/stop payment of cheque etc.
c) SMS Banking: SMS banking is a form of mobile banking. It is a facility used by some
banks or other financial institutions to send messages (also called notifications or alerts) to
customer’s mobile phones using SMS messaging, or a service provided by them which
enables its customers to perform some financial transactions using SMS.

d) Mobile Banking: Mobile banking is a service provided by a bank or other financial

institution that allows its customers to conduct a range of financial transactions remotely
using a mobile device such as a mobile phone or tablet, and using software, usually called
an app, provided by the financial institution for the purpose. Mobile banking is usually
available on a 24-hour basis. The types of financial transactions which a customer may
transact through mobile banking include obtaining account balances and list of latest
transactions, electronic bill payments, and funds transfers between a customer's or another's
accounts. Some also enable copies of statements to be downloaded and sometimes printed at
the customer's premises; and some banks charge a fee for mailing hardcopies of bank
statements.

APPLICATIONS OF HDFC:
PAYZAPP: HDFC BANK LTD has launched PAYZAPP a mobile app that allows the
customer to broadly do 5 things- manage debit/ credit card details, recharge and pay bills, use
virtual card, send money through wallet and shop. The app is available only for HDFC
BANK customers and can be downloaded from GOOGLE PLAY STORE this app is
available only for android phone users. PAYZAPP contains a prepaid wallet and a virtual
prepaid card. Bank customers can also store their credit or debit cards in a dematerialized
form in the app and use them for electronic payments. Customers can also send money to
peers through the app using the IMPS platform. With PayZapp, we can shop on our mobile at
partner apps, buy movie tickets, music and groceries, compare and book flight tickets and
hotels, pay bills and recharge our mobile, DTH and data card. Once the app is installed the
customer is registered with the bank, then after filling details such as full name, email-id, date
of birth, etc. one has to create personal identification number (pin). Login Id will be the
customer’s mobile number. In order to send money through contact list on email-id one will
have to first load money in the wallet by linking either HDFC BANK debit/ credit card. The
transaction happens on Visa and Master card platforms only. Hence, to load money in wallet
one will have to provide card details and amount then one can send money to any mobile
phone number in one’s contact list or to an email-id from the wallet. Once, all the steps are
completed in order to pay the required amount then the customer will be directed to choose
card option and approve the transaction.
DIGITAL WALLET: HDFC Bank has launched their own digital wallet- merchant payment
service in India, which they have termed as “The future of mobile payments” and it can be
used across various online retailer outlets. Customers can make payments for their purchases
on various websites by remembering their HDFC bank digital wallet details. Moreover,
retailers can add this additional mode of transaction for offering the ease of making payment.
Apart from HDFC bank account holders, non HDFC bank customers are also eligible to
apply for this service. To make it easier for merchants to accept payments via digital wallet,
HDFC has enabled Near Field Communication (NFC) based contact less payment facility as
well. Besides HDFC Bank account holders, non-HDFC bank users can also use their Digital
Wallet, making it platform independent. Highlighting the importance of digital wallet, Parag
Rao, senior EVP and Head of card payment products in HDFC said, “Our digital wallet will
enable the transaction to be completed in two steps, which substantially cuts down the failure
rate on mobile phone purchases, which is as high as 50%,”.Digital wallets meet RBI’s 2 step
verification process while making a payment; and, it is now increasingly being used by
consumers and shoppers, especially in the ecommerce and retail segment.
WATCH BANKING: HDFC Bank is set to become the first Indian Bank and probably the
fourth lender in the world to have such an application whose mobile banking application app
will be available on the Apple watch, to be launches in India in June 2015. HDFC bank will
offer 8-10 features commonly available on the mobile banking app. HDFC bank’s mobile

banking app has about 75 features and those commonly used will be available in the watch,
such as balance enquiry, recharge of prepaid mobile phones, cheque book request as well
as paying utility bills.

DIGITAL BANKING- PROCESS/ CONTRIBUTION: The two-three most promising

areas where digital advances could revolutionize the customer experience are artificial
intelligence and personalization. Internet of Things is another area where some form of
banking transactions could help enable transaction banking. HDFC bank has undertaken
several initiatives to change the way the relationship works between the bank and customers.
HDFC has undertaken steps on lending, payments and transactions, communication, and data
analyses in terms of training our employees to understand how banking works in the digital
world. All of these offerings are meant to ease the way the customer interacts with the bank.
HDFC has been closely monitoring trends that have emerged in the financial technologies
and startup space to keep looking for ideas how we can improve our offerings. HDFC is
working with a lot of fintech startups to bring in solutions that we can offer to our customers.
The impact of these initiatives is showing. Ten years ago, the share of Internet and mobile
banking transactions [as a % of total transactions] stood at 13 percent. In FY13, it stood at 44
%, in FY14, it was 55 %. In FY15, the number was at 63 %. Last fiscal, it has gone up to 71

%. The share of branch transactions today has gone down to 11 %. HDFC launched the 10-
second personal loan where pre-approved customers get funds credited into the bank
accounts within 10 seconds of filling up their applications digitally. That was setting a
benchmark of digital. HDFC also introduced a recharge-on-missed-call feature that allows
our customers to recharge their prepaid mobile phones on the go.

CONTRIBUTION OF DIGITAL BANKING SERVICES AT HFDC

I was working as a summer intern with “HDFC BANK LTD” for a period of 2 months. The
field experience helped me to develop the quality of analyzing, observing, and participating
which helped me to guide the customer about digital banking and its uses. I could also
ascertain the effect of such initiative of HDFC bank on their revenue and whether the bank is
successful in transforming itself to a completely digital platform. I would like to recommend
for the improvisation of the bank they could make in the successful implementation of digital
banking in terms of technology to be used, security to be provided and how to persuade the
existing and potential customers to shift towards digital banking. The customers should be
aware of the digital banking applications introduced by the bank by giving them a demo
through the digital banking kiosk present in the branch and deviating them towards them
using the mobile, tablets to perform the various type of banking transactions like opening a
demat account, paying of bills, applying for personal or automobile loan, opening of FD/RD
without even visiting the branch through mobile/net/phone banking.

I closely observed each and every customer visiting the branch having queries regarding
digital banking or their usage. I was assigned with a task to convince at least 5 customer per
day regarding digital banking. During the period of 2 months I observed that only few
customers were ready to shift to the digital banking but majority of them are still believe that
traditional banking due to security reasons.

In two months of my internship some digital banking applications were introduced by the bank
successively like CHILLR and PAYZAPP where CHILLR is an application where one can send
money to any of the mobile phone contacts like a SMS on 24*7 basis instantly. No
information is needed of the recipient one just need to select them from one’s contact list
and enter amount then send instant fund transfer to a friend in their phone book and also
introduced of PAYZAAP a mobile app that allows the customer to broadly do 5 things
manage debit/credit card details, recharge and pay bills, use virtual car, send money
through wallet, and shop.

The outcome of digital banking is the number of customers visiting bank branch has
reduced as they are able to perform banking transaction without visiting the bank branch.
This shows the bank is successful in transforming the customers to digital banking from
traditional banking.

RESEARCH DESIGN-
RESEARCH METHODOLOGY-
PRIMARY DATA COLLECTION-
Interacting directly with the customers visiting the branch

SECONDARY DATA COLLECTION-

 Studied all the websites and mobile apps of HDFC in order to know about the
products andservices of the bank.
 Through Online questionnaire: Data collection from non HDFC bank customers by
sendingthem questionnaire made via Google forms

Research Design-
A research design is the arrangement of conditions for collection and analysis of data in a
manner that aims to combine relevance to the research purpose with economy in procedure.
In fact, the research design is the conceptual structure within which research is conducted.
This research is a descriptivein nature.
Descriptive Research-
The research undertaken is a descriptive research as it is concerned with specific predictions,
with narration of facts and characteristics concerning digital banking services provided by
HDFC Bank.
Sampling Design-
Universe of study: Universe of the study means all the persons who are the
customers of HDFC Bank Anantpur branch
 Theoretical: It covered all the individuals who are the customers of HDFC Bank
anantpur branch ranchi.
Accessible: It covered all the individuals who are the customers of HDFC Bank
Salt Lake Branch who are within our reach. In this study accessible population is
customers of HDFC Bank anatpur branch ranchi.
Sample Size: A sample of minimum respondent was selected from visting customers of
An effort was made to select respondents evenly. The survey
was carried out on 50 respondents.
Sample Unit: In this project sampling unit consisted of the various individuals who
have their bank accounts with HDFC Bank anatpur branch ranchi.
Sampling Technique: For the purpose of research convenient sampling technique
was used.

ANNEXURE-1

BANKER’S QUESTIONNAIRE

Q.1 What do you feel about e-banking as a new system of delivering banking services?

a. VITAL
b. ESSENTIAL
c. DESIRABLE
d. CANNOT SAY EXACTLY

Q.2 Which of the following E-banking services are provided by your bank?

a. ATM BANKING
b. TELEPHONE BANKING
c. CREDIT CARDS
d. DEBIT CARDS
e. MOBILE BANKING
f. ELECTRONIC FUNDS TRANSFER (EFTs)
g. INTERNET BANKING

Q.3 How do you let your customers know about E-banking services you provide? (Tick
applicable one(s))
 a. THROUGH BANK OFFICIALS
b. ADVERTISEMENT IN PRINT MEDIA
c. TELEVISION AND RADIO ADVERTISEMENT
d. ONLINE ADVERTISEMENTS
e. OTHERS

Q.4 Indicate by marking the services offered through ATM in your bank

a. WITHDRAWAL OF CASH
b. DEPOSIT OF CASH AND CHEQUE
c. BALANCE CHECK
d. REQUESTING CHEQUE BOOK
e. PAYING ANY UTILITY BILLS CHECKING BANK STATEMENTS
f. TRANSFER OF FUNDS

Q.5 What are methods you use to encourage your bank customers to use E-banking? (Tick
as many as applicable)

a. MAKE SERVICES CHEAPER BY REDUCING CHARGES AND FEES

b. INCENTIVES TO E-BANKING USERS
c. INTENSIVE ADVERTISEMENT
d. CONTACTING EVERY CUSTOMER PERSONALLY
e. KEEP ON REMINDING CUSTOMERS THROUGH WRITTEN
COMMUNICATION
f. DEMONSTRATING ON HOW TO USE E-SERVICES TO THEM
g. GIVING THEM ASSURANCE OF SECURITY AND PRIVACY
h. GIVING THE TECHNOLOGICAL KNOWLEDGE TO CUSTOMERS THROUGH
SEMINARS

Q.6 In your own opinion what are the challenges facing the adoption of E-banking
technologies?

(Please give your opinion to the following statements)

• The cost of adopting the technologies is very high

i. Strongly Agree
 ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree
• No difference in profitability as compared to branch banking

i. Strongly Agree

ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree
• There is technological illiteracy among bankers

i. Strongly Agree

ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree

• Most customers do not know how to use and about various E-banking
services provided by their banks

i. Strongly Agree
 ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree

Q.7 Why do you think it is important to adopt E-banking services

(Please give your opinion to the following statements)

• E-banking services are generally more faster than traditional banking which will help
to reduce long queues in banks

i. Strongly Agree

ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagre

• E-banking services are more convenient as customers can avail it from anywhere

i. Strongly Agree

ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree
 • Adopting E-banking services would help in retaining more customers

i. Strongly Agree

ii. Agree

iii. Neutral

iv. Disagree

v. Strongly Disagree

PERSONNEL INFORMATION

➢
NAME…………………………………………………………………………
➢
CONTACT No.
…………………………………………………………….
➢
WORKING EXPERIENCE
a) LESS THAN 1 YEAR

b) BETWEEN 1 TO 5 YEARS
 c) 5 TO 10 YEARS

d) 10 TO 15 YEARS

e) MORE THAN 15 YEARS

TABULATIONS & GRAPHS ( BANKER’S QUESTIONNAIRE)

These are the figures or results of responses given by the banker or bank
employees of HDFC bank on the basis of questionnaire which have been given
to them
ANNEXURE-2

CUSTOMER’S QUESTIONNAIRE
DIGITAL BANKING: NEW AGE BANKING

1. Name*
2. Gender*
 Male
 Female
 Others
3. Age*
 18-24
 25-34
 35-44
 45-60
 60 and above.
4. Do you have a bank account?*
 Yes
 No
5. With which of the following banks are you associated with?*
 State Bank Of India
 HDFC Bank
 ICICI Bank
 Axis Bank
 Yes Bank
 Bank of India
 Other
6. Do you use Net banking/Mobile banking?*
 Yes
 No
7. If no , please specify the reasons
 Security reason
 Lack of awareness
 Don’t think it is useful
 Other
8. Which of the following applications do you use?
 Payzapp
 Net banking
 SMS banking
 Bill pay
 Mobile banking
  Smartbuy

9. . Which online features do you use regularly?

 Transfer funds to other accounts
 Download or view statement
 Make credit card payments
 To create online FD/RD
 View offers
 Request cheque book/stop payments
 Other

10 . What are the reasons that you opted for net banking account?
 Convenience
 To save time
 Safe and secure
 Easy to maintain banking transactions
 Other
11.Why did you choose HDFC’s banking services?*
 Faster Services
 Brand name of the Bank
 Easy to use
12.How often do you use net banking services?*
 2-3 times per week
 Daily
 Once per week
 Once per month
13. How would you rate the overall experience with HDFC banking services?*
14. How would you rate the overall experience with HDFC banking services?*
 Excellent
 Very Good
 Good
 Poor
15.For net banking, which will be your first choice among the following banks?*
 HDFC Bank
 State Bank of India
 Axis Bank
 ICICI Bank
 YES Bank
16. For net banking , which will be your second preference among the following banks?*
 HDFC Bank
 State Bank of India
 Axis Bank
 ICICI Bank
 YES Bank

Analysis of the questionnaire

CONCLUSION
The introduction of new technology has been changing the attire of banking. The brick and
mortar banking are slowly giving place to click of the mouse banking, technology is aid in
globalization and integration of financial markets across the globe. Customer’s expectations
for new products and alternatives delivery channels have been rising. Banks are under
pressure to offer today, what customers would be expecting tomorrow. Thanks to innovations
and spread of new technology, bank today offer the customer a choice to conduct his business
across the counter, over the phone or via a computer.

While dealing with the customers I faced various problems, different customers had different
perspective towards using digital services they had various misconceptions about the
services, like extra charges on being digitally active, security issues etc. Best possible
measures were taken by me to solve the customers’ problems and clarify their doubts and if
the problem was not solved by me then carry forwarding the same to the senior officials and
making sure the customers were satisfied. Therefore, it was great learning opportunities for
me observing the senior bankers solve the problems of the customers
The job also involved learning about the various products and services of the bank and
observing the bankers in charge of sales while they had a talk with the customers. This helped
me to learn the way of talking differently to different customers and the way of customizing
the service and products according to the demand of the customers.

Overall it was a great experience working in the banking sector especially in one of the most
respectable private sector banks. This internship has by all means prepared me for the
corporate world. The challenges I faced during the entire internship and overcoming them
will help me to serve better in the corporate world in future.
RECOMMENDATIONS

Embracing a fully digital strategy requires banks to modernize end-to-end, and to adopt a
customer centric approach. The following recommendations can help banks in general
and specifically HDFC Bank to ensure that their move to digital banking will result in
greater customer satisfaction and long-term profitability and business.

a) Manage and master the information that’s vital to digital banking. For banks to create new
sources of value, they need to understand the data that makes up their customers’ Code
Halos, each individual’s unique virtual identity.
b) They should act strategically. Providing a cohesive, cross-channel experience requires an
enterprise-wide approach.
c) Calculate the cost of not adopting digital banking: Lost opportunity, customer attrition,
and stagnation in new-customer growth and product sales.
d) Evaluate options carefully. Digital banking isn’t one-size-fits-all. Banks need to select
the options that best fit their organisation and strategy.
e) Create an enterprise roadmap. A roadmap is a key prerequisite for implementing a digital
banking program.
f) Banks should also ensure that online banking is safe and secure for financial
transaction similar to the traditional banking.
g) Banks should organize seminar and conference to educate the customer regarding uses
of online banking as well as security and privacy of their accounts.
h) Some customers are hindered by lack of computer skills. They need to be educated on
basic skills required to conduct online banking.
i) Banks must emphasize the convenience that online banking can provide to people, such
as avoiding long queue, in order to motivate them to use it.
j) Banks must emphasize the cost saving that online can provide to the people, such as reduce
transaction cost by use of online banking.
BIBLIOGRAPHY

 Websites:

• https://www.motilaloswal.com/site/rreports/636558375327619587.pdf

• https://www.hdfcbank.com/aboutus

• http://digiqom.com/clientnews/hdfcbank/tag/digital-banking/

• https://m.rbi.org.in//scripts/PublicationReportDetails.aspx?UrlPage=&ID=243

• Wikipedia

• Pdfs:
• Annual report HDFC Bank 2017-18

• Media Coverage of MR. Nitin Chung