A Comparative study between SBI and HDFC Bank

With respect to their E-Banking Facilities.

A Project Submitted to

University of Mumbai for partial completion of the

degree of

Master in Commerce

Under the Faculty of Commerce

By

Kamaluddin Shaikh

Under the Guidance of

Prof. Aksha Memon

Valia C.L. College of Commerce & Valia L.C. College

of Arts C.E.S. Road, D.N. Nagar, Andheri(W), Mumbai-

400053

December, 2019

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 A Comparative study between SBI and HDFC Bank
With respect to their E-Banking Facilities.

A Project Submitted to
University of Mumbai for partial completion of the degree of
Master in Commerce
Under the Faculty of Commerce
By
Kamaluddin Shaikh

Under the Guidance of

Prof. Aksha Memon

Valia C.L. College of Commerce & Valia L.C. College of

Arts C.E.S. Road, D.N. Nagar, Andheri(W), Mumbai-
400053

December, 2019

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 Declaration by learner
I the undersigned .Kamaluddin Shaikh here by,
Declare that the work embodied in this project work titled ‘A Comparative Study
on Brand evaluation with respect of Samsung & Nokia Brand

Forms my own contribution to the research work carried out under the guidance of
Prof. Aksha Memon, is a result of my own research work and has

not been previously submitted to any other University for any other Degree/
Diploma to this or any other University.

Wherever reference has been made to previous works of others, it has been clearly
indicated as such and included in the bibliography.

I, here by further declare that all information of this document has been obtained
and presented in accordance with academic rules and ethical conduct.

Name and Signature of the learner

Kamaluddin Shaikh

Certified by
Name and signature of the Guiding Teacher

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 Acknowledgment

To list who all have helped me is difficult because they are so numerous and the
depth
is so enormous.

I would like to acknowledge the following as being idealistic channels and

fresh Dimensions in the completion of this project.

I take this opportunity to thank the University of Mumbai for giving me chance
to do this project.
I would like to thank my Principal, Mrs.Shobha Menon for providing
the necessary facilities
required for completion of this project.

I take this opportunity to thank our Coordinator Ankita Das for her moral
support and guidance.
I would also like to express my sincere gratitude towards my project guide

‘Prof. Aksha Memon whose guidance and care made the project successful.

I would like to thank my College Library, for having provided various reference
Books and magazines related to my project.
Lastly, I would like to thank each and every person who directly or
indirectly helped

me in the completion of the project and Peers who supported

me throughout my project

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 INDEX

Chapter Title of the chapter Pg.no

no

Chapter 1 Introduction 6-67

Chapter 2 Research Methodology 68-69

Chapter 3 Literature Review 70-80

Chapter 4 Data Analysis / Interpretation / Presentation 81-88

Chapter 5 Findings / Suggestions And Conclusion 89-93

Chapter 6 Bibliography 94

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INTRODUCTION TO E-BANKING

The banking scenario in India in the post liberalization and deregulated

environment has witnessed sweeping changes. The tremendous advances in technology
and the aggressive infusion of information technology had brought in a paradigm shift in
banking operations. For the bank, technology has emerged as a strategic resource for
achieving higher efficiency control of operations, productivity and profitability. For
customers, it is the realization of their ‘Anywhere, Anytime, Anyway’ banking dream".
This has prompted the banks to embrace technology to meet the increasing customer
expectation.

Image 1 – E banking

Technology to start with is a business enabler and now has become a business
driver The banking institutions cannot think of introducing a financial product without
information technology support be it customer service / transactions / remittances / audit
/ marketing / pricing or any other activity in the banks. Information Technology plays an
important role not only to complete the activity with high efficiency but also has the
potential to innovate and meet the future requirements. Information Technology has
therefore introduced new business paradigms and is increasingly playing a significant
role in improving the services in banking industry. In the above backdrop it becomes
imperative to dwell on the evolution of Information

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 Technology in banks before embarking on the various aspects of e-banking.
Information Technology came into picture as early as in the 1980s in banking industry
through the Rangarajan committee recommendations and banks have given utmost
importance to the technology since the last 25 years. The (serve Bank of India is
constantly pursuing the banks from 1980s to introduce computerization at branch level
and to improve the quality of customer service through technology. E-Banking implies
performing basic banking transaction by customers round the clock globally through
electronic media. Alternatively electronic banking can be defined as delivery of bank’s
services to a customer at his office or home by using electronic technology and this has
resulted in conceptualization of virtual banking In traditional banking, the customer has
to visit the branch of the bank in person to perform the basic banking operations viz.
account enquiry, fund transfer and cash withdrawal. The brick and mortar structure of a
bank is essential to perform the banking functions.

On the other hand, E-Banking enables the customers to perform the basic banking
transactions by sitting at their office or at homes through PC or LAPTOP. The customers
can access the bank’s website for viewing their account details and perform the
transactions on account as per their requirements. Thus, today’s banking is no longer
confined to branches. Customers are being provided with additional delivery channels
which are more convenient and are cost
effective to the banks.

This has resulted in shrinking of

geographical boundaries, easy reach to
the clientele, reliable and secure services.
The E-Banking services include
Automated Teller Machine, Plastic Card
Currency, Internet Banking and
Electronic Clearing Services.

Image 2 - Device

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 State Bank of India is the largest bank with network of over 15000 branches and 5
associate bank located even in the remote part of India. SBI offers a wide range of
banking products and services to corporate and
retail customers. Now a day’s information
technology plays a vital role in banking sector.
Day-by-day increasing change in technology
world, it leads to improve e-banking services of
various banks. Traditional branch model of bank
is now changing into new form of e-banking
services like kiosk marketing machine, coin
vending machines of SBI etc. It provides various
advantages to customers. Image 3 – Global Connectivity

Today people are educated more than olden days, human lives becomes machine
oriented and they don’t have enough time to visit bank branch than ever before. E-
Banking means providing banking products and services through electronic delivery
channels like ATM, Internet banking, Telephone banking and other electronic delivery
channels. SBI has over 4500 centers in India approximately. Automated Teller Machine
(ATM) is electronic computerized
telecommunication device that allows a customer to
directly use a secured method of communication to
access their bank accounts or make cash
withdrawals and other services. Internet banking
highly useful to the customer one who have
computer with internet connection, they need not
visit bank branch for their business transactions.
Simply they can transact anywhere, anytime if they
have internet connection. Image 4 - ATM

By dialing the telebanking number customer can get various facilities like cheque book
request, balance inquiry, etc.

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 With cyber cafes and kiosks springing up in different cities access to the Net is
going to be easy. Net banking (also referred as e banking) is the latest in this series of
technological wonders in the recent past involving use of Internet for delivery of banking
products & services. Even the Morgan Stanley Dean Witter Internet research emphasized
that Web is more important for retail financial services than for many other industries.
Internet banking is changing the banking industry and is having the major effects on
banking relationships. Banking is now no longer confined to the branches were one has to
approach the branch in person, to withdraw cash or deposit a cheque or request a
statement of accounts. In true Internet banking, any inquiry or transaction is processed
online without any reference to the branch (anywhere banking) at any time. Providing
Internet banking is increasingly becoming a "need to have" than a "nice to have" service.
The net banking, thus, now is more of a norm rather than an exception in many developed
countries due to the fact that it is the cheapest way of providing banking services.

Image 5 – Retail Banking

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HISTORY OF INTERNET BANKING

The term online banking was first started in 80‟s. The term online became
popular in the late '80s and referred to the use of a terminal, keyboard and TV (or
monitor) to access the banking system using a phone line. „Home banking‟ can also
refer to the use of a numeric keypad to send tones down a phone line with instructions to
the bank. Online services started in New York in 1981 when four of the city‟s major
banks (Citibank, Chase Manhattan, Chemical and Manufacturers Hanover) offered home
banking services using the videotext system. Because of the commercial failure of
videotext these banking services never became popular except in France where the use of
videotext was subsidized by the telecom provider and the UK, where the Prestel system
was used.

The UK‟s first home online banking services was set up by the Nottingham
Building Society (NBS) in 1983 .The system used was based on the UK's Prestel system
and used a computer, such as the BBC Micro, or keyboard (Tandata Td1400) connected
to the telephone system and television set. The system (known as 'Home link') allowed
on-line viewing of statements, bank transfers and bill payments. In order to make bank
transfers and bill payments, a written instruction giving details of the intended recipient
had to be sent to the NBS who set the details up on the Home link system. Typical
recipients were gas, electricity and telephone companies and accounts with other banks.
Details of payments to be made were input into the NBS system by the account holder via
Prestel. A cheque was then sent by NBS to the payee and an advice giving details of the
payment was sent to the account holder. BACS was later used to transfer the payment
directly.

Stanford Federal Credit Union was the first financial institution to offer
online internet banking services

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DEVELOPMENT OF NET BANKING IN INDIA

The financial reforms that were initiated in the early 1990s and the globalization
and liberalization measures brought in a completely new operating environment to the
banks. The bankers are now offering innovative and attractive technology-based services
and products such as ‘Anywhere Anytime Banking’, ‘Tele-Banking’, ‘Internet Banking’,
‘Web Banking’, ‘Net Banking’, ‘Mobile Banking’, etc. to their customers to cope with
the competition. The process started in the early 1980s when Reserve Bank of India
(RBI) set up two committees in quick succession to accelerate the pace of automation of
operations in the banking sector. A high-level committee was formed under the
chairmanship of Dr. C. Rangarajan, then Governor of RBI, to draw up a phased plan for
computerization and mechanization in the banking industry over a five-year time frame
of 1985–1989. The focus by this time was on customer service and two models of branch
automation were developed and implemented. Having gained experience in the earlier
mode of computerization, the second Rangarajan committee constituted in 1988 drew up
a detailed perspective plan for computerization of banks and for extension of automation
to other areas such as funds transfer, e-mail, BANKNET, SWIFT, ATMs, net banking,
etc.

The Government of India enacted the Information Technology Act, 2000

(generally known as IT Act, 2000), with effect from 17 October 2000 to provide legal
recognition to electronic transactions and other means of electronic commerce. RBI had
set up a ‘Working Group’ on net banking to examine different aspects of net banking.

The Group had focused on three major areas of net banking such as

(1) Technology and security issues,

(2) Legal issues

(3) Regulatory and supervisory issues.

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 RBI had accepted the recommendations of the ‘Working Group’, and accordingly
issued guidelines on ‘internet banking in India’ for implementation by banks. The
‘Working Group’ has also issued a report on net banking covering different aspects of net
banking. Internet banking in India is currently at a nascent stage. While there are scores
of companies specializing in developing internet banking software, security software and
website designing and maintenance, there are few online financial service providers.

ICICI bank is the first one to have introduced net banking for a limited range of
services such as access to account information, correspondence and, recently, funds
transfer between its branches. ICICI is also getting into e-trading, thus offering a broader
range of integrated services to the customer. Several finance portals for provision of non-
banking financial services, e-trading and e- broking have come up. Commercial
applications such as Electronic Bill Presentment (EBP) and Procurement systems may
not be introduced in India immediately, but are likely to have a greater impact than the
retail applications. The corporate sector is adequately computerized and has already
recognized the important role of e-commerce in future. Increasingly, companies are
setting up websites even where there are no immediate tangible benefits to them from
doing so.

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NET BANKING IN INDIA – RBI GUIDELINES

In India, internet banking or net banking is in rudimentary stage. In order to

promote safety and soundness of internet banking activities, the RBI constituted a
Working Group on Internet Banking. The Group issued guidelines in June 2001. The
Group divided the internet banking products in India into 3 types based on the levels of
access granted. They are

 Information Only System

 Electronic Information Transfer System

 Fully Electronic Transactional System.

Image 6 - RBI

Internet Banking in India Guidelines

You may be aware that Reserve Bank of India had set up a ‘Working Group on
Internet Banking’ to examine different aspects of Internet Banking (I-banking). The
Group had focused on three major areas of I-banking,

(i) Technology and security issues,

(ii) Legal issues and

(iii) Regulatory and supervisory issues.

A copy of the Groups report is enclosed. RBI has accepted the recommendations
of the Group to be implemented in a phased manner. Accordingly, the following
guidelines are issued for implementation by banks. Banks are also advised that they may
be guided by the original report, for a detailed guidance on different issues.

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I. Technology and Security Standards:

A. Banks should designate a network and database administrator with clearly defined
roles as indicated in the Group’s report.

B. Banks should have a security policy duly approved by the Board of Directors.
There should be a segregation of duty of Security Officer / Group dealing
exclusively with information systems security and Information Technology
Division which actually implements the computer systems. Further, Information
Systems Auditor will audit the information systems.

C. Banks should introduce logical access controls to data, systems, application

software, utilities, telecommunication lines, libraries, system software, etc.
Logical access control techniques may include user-ids, passwords, smart cards or
other biometric technologies.

D. At the minimum, banks should use the proxy server type of firewall so that there
is no direct connection between the Internet and the bank’s system. It facilitates a
high level of control and in-depth monitoring using logging and auditing tools.
For sensitive systems, a stateful inspection firewall is recommended which
thoroughly inspects all packets of information, and past and present transactions
are compared. These generally include a real time security alert.

E. All the systems supporting dial up services through modem on the same LAN as
the application server should be isolated to prevent intrusions into the network as
this may bypass the proxy server.

F. PKI (Public Key Infrastructure) is the most favoured technology for secure
Internet banking services. However, as it is not yet commonly available, banks
should use the following alternative system during the transition, until the PKI is
put in place:

 Usage of SSL (Secured Socket Layer), which ensures server

authentication and use of client side certificates issued by the banks
themselves using a Certificate Server.

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  The use of at least 128-bit SSL for securing browser to web server
communications and, in addition, encryption of sensitive data like
passwords in transit within the enterprise itself.

G. It is also recommended that all unnecessary services on the application server

such as FTP (File Transfer Protocol), telnet should be disabled. The application
server should be isolated from the e-mail server.

H. All computer accesses, including messages received, should be logged. Security

violations (suspected or attempted) should be reported and follow up action taken
should be kept in mind while framing future policy. Banks should acquire tools
for monitoring systems and the networks against intrusions and attacks. These
tools should be used regularly to avoid security breaches. The banks should
review their security infrastructure and security policies regularly and optimize
them in the light of their own experiences and changing technologies. They
should educate their security personnel and also the end-users on a continuous
basis.

I. The information security officer and the information system auditor should
undertake periodic penetration tests of the system, which should include:

 Attempting to guess passwords using password-cracking tools.

 Search for back door traps in the programs.

 Attempt to overload the system using DDoS (Distributed Denial of

Service) & DoS (Denial of Service) attacks.

 Check if commonly known holes in the software, especially the browser

and the e-mail software exist.

 The penetration testing may also be carried out by engaging outside

experts (often called ‘Ethical Hackers’).

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J. Physical access controls should be strictly enforced. Physical security should
cover all the information systems and sites where they are housed, both against
internal and external threats. (Para 6.4.9)

K. Banks should have proper infrastructure and schedules for backing up data. The
backed-up data should be periodically tested to ensure recovery without loss of
transactions in a time frame as given out in the bank’s security policy. Business
continuity should be ensured by setting up disaster recovery sites. These facilities
should also be tested periodically.

L. All applications of banks should have proper record keeping facilities for legal
purposes. It may be necessary to keep all received and sent messages both in
encrypted and decrypted form.

M. Security infrastructure should be properly tested before using the systems and
applications for normal operations. Banks should upgrade the systems by
installing patches released by developers to remove bugs and loopholes, and
upgrade to newer versions which give better security and control.

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II. Legal Issues

A. Considering the legal position prevalent, there is an obligation on the part of

banks not only to establish the identity but also to make enquiries about integrity
and reputation of the prospective customer. Therefore, even though request for
opening account can be accepted over Internet, accounts should be opened only
after proper introduction and physical verification of the identity of the customer.

B. From a legal perspective, security procedure adopted by banks for authenticating

users needs to be recognized by law as a substitute for signature. In India, the
Information Technology Act, 2000, in Section 3(2) provides for a particular
technology (viz., the asymmetric crypto system and hash function) as a means of
authenticating electronic record. Any other method used by banks for
authentication should be recognized as a source of legal risk.

C. Under the present regime there is an obligation on banks to maintain secrecy and
confidentiality of customers‘ accounts. In the Internet banking scenario, the risk
of banks not meeting the above obligation is high on account of several factors.
Despite all reasonable precautions, banks may be exposed to enhanced risk of
liability to customers on account of breach of secrecy, denial of service etc.,
because of hacking/ other technological failures. The banks should, therefore,
institute adequate risk control measures to manage such risks.

D. In Internet banking scenario there is very little scope for the banks to act on stop-
payment instructions from the customers. Hence, banks should clearly notify to
the customers the timeframe and the circumstances in which any stop-payment
instructions could be accepted.

E. The Consumer Protection Act, 1986 defines the rights of consumers in India and
is applicable to banking services as well. Currently, the rights and liabilities of
customers availing of Internet banking services are being determined by bilateral
agreements between the banks and customers. Considering the banking practice

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 and rights enjoyed by customers in traditional banking, banks’ liability to the
customers on account of unauthorized transfer through hacking, denial of service
on account of technological failure etc. needs to be assessed and banks providing
Internet banking should insure themselves against such risks.

III. Regulatory and Supervisory Issues:

As recommended by the Group, the existing regulatory framework over banks will be
extended to Internet banking also. In this regard, it is advised that:

A. Only such banks which are licensed and supervised in India and have a physical
presence in India will be permitted to offer Internet banking products to residents
of India. Thus, both banks and virtual banks incorporated outside the country and
having no physical presence in India will not, for the present, be permitted to offer
Internet banking services to Indian residents.

B. The products should be restricted to account holders only and should not be
offered in other jurisdictions.

C. The services should only include local currency products.

D. The ‘in-out’ scenario where customers in cross border jurisdictions are offered
banking services by Indian banks (or branches of foreign banks in India) and the
‘out-in’ scenario where Indian residents are offered banking services by banks
operating in cross-border jurisdictions are generally not permitted and this
approach will apply to Internet banking also. The existing exceptions for limited
purposes under FEMA i.e. where resident Indians have been permitted to continue
to maintain their accounts with overseas banks etc., will, however, be permitted.

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 E. Overseas branches of Indian banks will be permitted to offer Internet banking
services to their overseas customers subject to their satisfying, in addition to the
host supervisor, the home supervisor.

Given the regulatory approach as above, banks are advised to follow the following
instructions:

 All banks, who propose to offer transactional services on the Internet should
obtain prior approval from RBI. Bank’s application for such permission should
indicate its business plan, analysis of cost and benefit, operational arrangements
like technology adopted, business partners, third party service providers and
systems and control procedures the bank proposes to adopt for managing risks.
The bank should also submit a security policy covering recommendations made in
this circular and a certificate from an independent auditor that the minimum
requirements prescribed have been met. After the initial approval the banks will
be obliged to inform RBI any material changes in the services / products offered
by them.

 Banks will report to RBI every breach or failure of security systems and
procedure and the latter, at its discretion, may decide to commission special audit
/ inspection of such banks.

 The guidelines issued by RBI on ‘Risks and Controls in Computers and

Telecommunications’ vide circular DBS.CO.ITC.BC. 10/ 31.09.001/ 97-98 dated
4th February 1998 will equally apply to Internet banking. The RBI as supervisor
will cover the entire risks associated with electronic banking as a part of its
regular inspections of banks.

 Banks should develop outsourcing guidelines to manage risks arising out of third
party service providers, such as, disruption in service, defective services and
personnel of service providers gaining intimate knowledge of banks’ systems and
misutilizing the same, etc., effectively.

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 With the increasing popularity of e-commerce, it has become necessary to set up
‘Inter-bank Payment Gateways’ for settlement of such transactions. The protocol
for transactions between the customer, the bank and the portal and the framework
for setting up of payment gateways as recommended by the Group should be
adopted.

 Only institutions who are members of the cheque clearing system in the country
will be permitted to participate in Inter-bank payment gateways for Internet
payment. Each gateway must nominate a bank as the clearing bank to settle all
transactions. Payments effected using credit cards, payments arising out of cross
border e-commerce transactions and all intra-bank payments (i.e., transactions
involving only one bank) should be excluded for settlement through an inter-bank
payment gateway.

 Inter-bank payment gateways must have capabilities for both net and gross
settlement. All settlement should be intra-day and as far as possible, in real time.

 Connectivity between the gateway and the computer system of the member bank
should be achieved using a leased line network (not through Internet) with
appropriate data encryption standard. All transactions must be authenticated.
Once, the regulatory framework is in place, the transactions should be digitally
certified by any licensed certifying agency. SSL / 128 bit encryption must be used
as minimum level of security. Reserve Bank may get the security of the entire
infrastructure both at the payment gateway’s end and the participating
institutions’ end certified prior to making the facility available for customers use.

 Bilateral contracts between the payee and payee’s bank, the participating banks
and service provider and the banks themselves will form the legal basis for such
transactions. The rights and obligations of each party must be clearly defined and
should be valid in a court of law.

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  Banks must make mandatory disclosures of risks, responsibilities and liabilities of
the customers in doing business through Internet through a disclosure template.
The banks should also provide their latest published financial results over the net.

 Hyperlinks from banks’ websites, often raise the issue of reputational risk. Such
links should not mislead the customers into believing that banks sponsor any
particular product or any business unrelated to banking. Hyperlinks from a banks’
websites should be confined to only those portals with which they have a payment
arrangement or sites of their subsidiaries or principals. Hyperlinks to banks’
websites from other portals are normally meant for passing on information
relating to purchases made by banks’ customers in the portal. Banks must follow
the minimum recommended security precautions while dealing with request
received from other websites, relating to customers’ purchases.

2. The Reserve Bank of India have decided that the Group’s recommendations as detailed
in this circulars should be adopted by all banks offering Internet banking services, with
immediate effect. Even though the recommendations have been made in the context of
Internet banking, these are applicable, in general, to all forms of electronic banking and
banks offering any form of electronic banking should adopt the same to the extent
relevant.

3. All banks offering Internet banking are advised to make a review of their systems in
the light of this circular and report to Reserve Bank the types of services offered, extent
of their compliance with the recommendations, deviations and their proposal indicating a
time frame for compliance. The first such report must reach us within one month from the
date of this circular. Banks not offering any kind of I-banking may submit a ‘nil’ report.

4. Banks who are already offering any kind of transactional service are advised to report,
in addition to those mentioned in paragraph above, their business models with projections
of cost / benefits etc. and seek our post-facto approval.

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5. Please acknowledge receipt.

ADVANTAGES AND DISADVANTAGES OF NET BANKING

Internet Banking also has its advantages and disadvantages. Below are
mentioned the most popular advantages of using Internet Banking along
with some unavoidable disadvantages.

The advantages include

 Convenience - online banking sites never close; they're available 24

hours a day, seven days a week, and they're only a mouse click away;

 Portability – you now have access to money whenever there is an

emergency, whether or not you are in the country;

 Transaction speed - online bank sites generally execute and confirm

transactions at the same rate or quicker than, ATM processing speeds;

 Effectiveness – they offer sophisticated tools, including account

aggregation, stock quotes and rate alerts to help you manage all of
your assets more effectively.

 Reduction in workload - No more standing in long lines at the bank,

eliminating endless paper based bank statements. The disadvantages
include

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The Disadvantages include

 Lack of Computerization - which relates to virtual banks, revolves

around the lack of ATMs;

 Start-up may take time - In order to register for your bank's online
program, you will probably have to provide ID and sign a form at a
bank branch which can be time consuming;

 Learning curve - Banking sites can be difficult to navigate at first;

 Distrust of the User - the possibility of frauds, making errors etc.

 Problem of Security – Various sites are not properly looked at to

ensure whether customer’s money is safe in cyber world or not.

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TRADITIONAL BANKING VS NET BANKING

Net banking or internet banking works much like traditional banking.

The primary difference is that in net banking account and information is
accessed, payments are made and statements reconciled using computer
rather than paper or the phone to complete transactions. Instead of going
down to local branch office when one bank online he/she can accomplish
multiple tasks at once with the click of a button. Online banking is rapidly
becoming more and more popular as consumers recognize the advantages
online banking has to offer. For one most banks charge fewer fees if you
take advantage of their online banking services. You can also stop receiving
paper statements if you like in many cases and conduct 95% of your
business over the Web when you take advantage of Internet banking. What
to Internet Banks do? The same things traditional banks do. They hold onto
our money and lend it out to others respectively.

The manage loans and help us keep track of our finances. Chances are
if you own a bank account at a traditional bank they offer some type of
Internet banking or online services. The next time you stop into your branch
office you should ask them about online banking. You may find once you
start you have no desire to go back to traditional banking. For those that
have a hard time keeping track of paper statements, Internet banking is life
saver. Internet banking is also advantageous for frequent travelers that need
to keep a close eye on their finances from abroad

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AN INTRODUCTION TO THE COMPANY

FORMATION OF THE COMPANY

HDFC

Image 7 – HDFC LOGO

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.

SBI

Image 8 – SBI LOGO

State bank of India is the nation’s largest and oldest bank. Tracing its roots back
some 200 years to the British East India Company (and initially established as the Bank
of Calcutta in 1806), the bank operates more than 15,000 branches within India, where it
also owns majority stakes in six associate banks. State Bank of India (SBI) has more than
80 offices in nearly 35 other countries, including multiple locations in the US, Canada,
and Nigeria. The bank has other units devoted to capital markets, fund management,
factoring and commercial services, credit cards, and brokerage services. The Reserve
Bank of India owns about 60% of State bank of India.

-25-
BUSINESS SEGMENTS

HDFC

HDFC Bank offers a wide range of commercial and transactional banking

services and treasury products to wholesale and retail customers. The bank has three key
business segments:

[ i ] Wholesale Banking Services

The Bank's target market ranges from large, blue-chip manufacturing companies
in the Indian corporate to small & mid-sized corporate and agro-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.

Image 9 – Whole Sale Banking

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 recognized as a leading provider
of cash management and transactional banking solutions to corporate customers, mutual
funds, stock exchange members and banks.

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[ ii ] Retail Banking Services

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 the customers through the growing branch network, as well as through
alternative delivery channels like ATMs, Phone Banking, Net Banking and Mobile
Banking.

Image 10 – Retail 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 September 30, 2005, the
bank had a total card base (debit and credit cards) of 5.2 million cards. The Bank is also
one of the leading players in the "merchant acquiring" business with over 50,000 Point-
of-sale (POS) terminals for debit / credit cards acceptance at merchant establishments.

-27-
[ iii ] Treasury Operations Within this business

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 liberalization 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.

Image 10 – Treasury

The Treasury business is responsible for managing the returns and market risk on this
investment portfolio.

-28-
The following tables summarize the products and services and customer segments offered
by HDFC Bank:

-29-
Table 1.1.1 E-banking

-30-
-31-
-32-
HDFC PROMOTER

HDFC is India's premier housing finance company and enjoys an impeccable

track recording 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.

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.

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.

-33-
CAPITAL STRUCTURE

As on 31st March, 2009 the authorized share capital of HDFC Bank is Rs. 550
crore. The paid-up capital as on the said date is Rs. 425,38,41,090/- ( 42,53,84,109 equity
shares of Rs 10/- each). The HDFC Group holds 19.38% of the Bank's equity and about
17.70 % of the equity is held by the ADS Depository (in respect of the bank's American
DepositoryShares (ADS) Issue). 27.69 % of the equity is held by Foreign Institutional
Investors(FIIs) and the Bank has about 5,48,774 shareholders.The shares are listed on the
Bombay Stock Exchange Limited and The National Stock Exchange of India Limited.
The Bank's American Depository Shares ( ADS ) are listed on the New York Stock
Exchange (NYSE) under the symbol 'HDB' and the Bank's Global Depository Receipts
(GDRs) are listed on Luxembourg Stock Exchange under ISIN NoUS40415F2002

DISTRIBUTION NETWORK

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable

network of over 1229 branches spread over 444 cities across India. All branches are
linked on an online real-time basis. Customers in over 120 locations are also serviced
through Telephone Banking.

The Bank's expansion plans take into account the need to have a presence in all
major industrial and commercial centers 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 the centers where the NSE/BSE has a strong and active member base. The
Bank also has a network of about over 2526 networked ATMs across these cities.
Moreover, 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

-34-
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. The Bank's business is supported by scalable and
robust systems which ensure that our clients always get the finest services we offer. The
Bank has prioritized 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.

RATING

Credit rating

The Bank has its deposit programs rated by two rating agencies - Credit Analysis
&Research Limited (CARE) and Fitch Ratings India Private Limited. The Bank's Fixed
Deposit programmer has been rated 'CARE AAA (FD)' [Triple A] by CARE, which
represents instruments considered to be "of the best quality, carrying
negligibleinvestment risk". CARE has also rated the bank's Certificate of Deposit (CD)
programme "PR 1+" which represents "superior capacity for repayment of short term
promissory obligations". Fitch Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.) has
assigned the "tAAA ( ind )" rating to the Bank's deposit programme, with the outlook on
the rating as "stable". This rating indicates "highest credit quality" where "protection
factors are very high”. The Bank also has its long term unsecured, subordinated (Tier II)
Bonds rated by CARE and Fitch Ratings India Private Limited and its Tier I perpetual
Bonds and Upper Tier Bonds rated by CARE and CRISIL Ltd. CARE has assigned the
rating of "CARE AAA" for the subordinated Tier II Bonds while Fitch Ratings India Pvt.
Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable".

-35-
CARE has also assigned “CARE AAA [Triple A]" for the Banks Perpetual bond and
Upper Tier II bond issues. CRISIL has assigned the rating "AAA Stable" for the Bank's
Perpetual Debt programme and Upper Tier II Bond issue. In each of the cases referred to
above, the ratings awarded were the highest assigned by the rating agency for those
instruments.

Corporate governance rating

The bank was one of the first four companies, which subjected itself to a
Corporate Governance and Value Creation (GVC) rating by the rating agency, The Credit
Rating Information Services of India Limited (CRISIL). The rating provides an
independent assessment of an entity's current performance and an expectation on its
"balanced value creation and corporate governance practices" in future. The bank has
been assigned a 'CRISIL GVC Level 1' rating which indicates that the bank's capability
with respect to wealth creation for all its stakeholders while adopting sound corporate
governance practices is the highest.

-36-
 SBI

Online SBI (www.Onlinesbi.com)

State Bank of India is India’s largest bank with a branch network of over 11000
branches and 6 associate banks located even in the remotest parts of India. State Bank of
India (SBI) offers a wide range of banking products and services to corporate and retail
customers. Online SBI is the Internet banking portal for State Bank of India. The portal
provides anywhere, anytime, online access to accounts for State Bank’s Retail and
Corporate customers.

The application is developed using the latest cutting edge technology and tools.
The infrastructure supports unified, secure access to banking services for accounts in
over 11,000 branches across India.

Image 12 – E verify SBI

-37-
RETAIL BANKING

Image 13 – Retail banking SBI

The Retail banking application is an integration of several functional areas, and enables
customers to:

 Issue Demand Drafts online

 Transfer funds to own and third party accounts

 Credit beneficiary accounts using the VISA Money Transfer, RTGS/NEFT

feature

 Generate account statements

 Setup Standing Instructions

 Configure profile settings

 Use e-Tax for online tax payment

 Use e-Pay for automatic bill payments

 Interface with merchants for railway and airline reservations

 Avail DEMAT and IPO services

- 38 -
CORPORATE BANKING

The Online SBI corporate banking application provides features to administer and
manage corporate accounts online. The corporate module provides roles such as
Regulator, Admin, Up loader, Transaction Maker, Authorizer, and Auditor. These roles
have access to the following functions:

 Manage users, define rights and transaction rules on corporate accounts

 Access accounts in several branches with a single sign-on mechanism

 Upload files to make bulk transactions to third parties, supplier, vendor and tax
collection authorities.

 Use online transactional features such as fund transfer to own accounts, third
party payments, and draft issues

 Make bill payments over the Internet.

 Authorize, modify, reschedule and cancel transactions, based on rights assigned to

the user

 Generate account statement

 Enquire on transaction details or current balance

-39-
VALUE ADDED SERVICES

 Tax payments to central and state governments through site to site integration.

 Supply Chain Finance( e-VFS- Electronic Vendor Finance Scheme)

 Direct Debit Facility

 E Collection Facilities for:

 Core Banking Transactions

 Internet Bank transactions for incoming RTGS/NEFT Transactions

 Internet banking transactions for SBI and associate banks

 Debit facility where suppliers can directly debit their customer’s account through
internet banking

SBI E-TAX

You can pay your taxes online through SBI E-Tax. This facility enables you to
pay TDS, Income tax, Indirect tax, Corporation tax, Wealth tax, Estate Duty and Fringe
Benefits tax. Click the e-Tax link in the home page. You are displayed a page with two
links Direct Tax and Indirect Tax. Click the Direct Tax link. You will be redirected to the
NSDL site where you can select an online challan based on the tax you wish to pay.
Provide the PAN, name and address, assessment year, nature of payment and bank name.
On selecting the bank name as SBI and submitting the form, you will be redirected to the
Internet Banking site. After submitting the respective ID and password, you can select
your account for making payment of taxes. After payment is successful you can print the
E-Receipt for the payment. The E-receipt can be printed at a later date also and the same
can be retrieved from: Enquiries > Find Transactions > Status Enquiries > Click on the
respective transaction to print the tax receipt.

-40-
 The Indirect Tax link is used to make Central Excise and Service Tax payments to
Central Board of Excise and Customs. The online payment feature facilitates anytime,
anywhere payment and an instant E-Receipt is generated once the transaction is
complete. The Indirect Tax payment facility is available to Registered Central
Excise/Service Tax Assesses who possesses the 15 digit PAN based Assesses Code. You
can make CBEC payments using the Indirect Taxes link available in the
Payments/Transfers tab. You need to provide your access code as registered with CBEC
and select the minor heads towards which you intend to pay tax. Select the appropriate
tax type and enter the tax amount. Select an account for debiting the total tax amount.
You can use any of your transaction accounts to make the payment. If a payment is
successful, CBEC provides a link to generate an E-Receipt for the payment. Internet
banking customers can pay tax through site to site integration. For government agencies,
which are not Internet-enabled, „Online SBI‟ offers the Government Tax Payment
facility. This facility is available as a post login feature in the retail and corporate banking
sites of the Online SBI portal.

-41-
PRODUCTS & SERVICES

 E-Ticketing

 SBI E-Tax

 Bill Payment

 RTGS/NEFT

 E-Payment

 Fund Transfer

 Third Party Transfer

 Demand Draft

 Cheque Book Request

 Account Opening Request

 Account Statement

 Transaction Enquiry

 Demat Account Statement

 Donation

-42-
E-TICKETING:

You can book your railway, air and bus tickets online through Online SBI. To
book your train ticket, just log on to irctc.co.in and create an ID there at if you do not
have one. Submit your travel plan and book the ticket(s)-either i-ticket (where the
delivery of tickets will be made at your address) or E-tickets (wherein after successful
payment transactions, an e-ticket is generated which can be printed any time. For an e-
ticket, the details of photo identity card will required to be filled in) and select State Bank
of India in the payment options. You will be redirected to Internet Banking site of SBI
(www.onlinesbi.com). After submitting the respective ID and password, you can select
your account. After a successful debit, Railways will generate the ticket. E-ticket can be
printed by you whereas the i-ticket will be dispatched by IRCTC at the given address.
Service charges @ Rs.10/- per transaction shall be levied in addition to the cost of the
ticket. Cancellation of E-ticket can be done by logging on to IRCTC's site; refund amount
will be credited to your account directly within 2-3 days. For cancellation of i-ticket, you
shall be required to submit your ticket at a computerized counter of Railways and on
cancellation; the amount shall be credited back to your account.

You can also book your Air ticket through the e-ticketing feature. Logon to Indian
Airlines website to make a payment for an e-ticket through State Bank of India, you need
to select SBI as the payment option. The payment request will be redirected to Internet
Banking site. The request may be processed based on values sent from the airlines
website. Once a transaction is processed, an appropriate response will be sent to airlines
site to update the status of the transaction. You can print the E-ticket immediately. To
book bus tickets to destinations in Karnataka, log on to the KSRTC website. Provide
details about the start and end points of your journey, date of journey and number of
tickets. Verify availability of seats on the selected date and confirm the transaction.
Select „Online SBI‟ to make the payment. Provide your credentials and select the SBI
account that will be debited for the payment. You are provided a KSRTC reference
number for your e-Ticket.

-43-
BILL PAYMENT

A simple and convenient service for viewing and paying your bills online. No
more late payments No more queues No more hassles of depositing cheques Using the
bill payment you can view and pay various bills online, directly from your SBI account.
You can pay telephone, electricity, insurance, credit cards and other bills from the
comfort of your house or office, 24 hours a day, 365 days a year. Simply logon to
http://www.onlinesbi.com/ with your credentials and register the biller to which you want
to pay, with all the bill details. Once the bill is uploaded by the biller, you can make
payment online.

You can see 'how do i' to learn the steps for using the facility. You can also set up
Auto Pay instructions with an upper limit to ensure that your bills are paid automatically
whenever they are due. The upper limit ensures that only bills within the specified limit
are paid automatically, thereby providing you complete control over these payments. The
e-PAY service is available in various cities across the country and you can now make
payments to several billers in your region.

RTGS/NEFT

You can transfer money from your State Bank account to accounts in other banks
using the RTGS/NEFT service. The RTGS system facilitates transfer of funds from
accounts in one bank to another on a "real time" and on "gross settlement" basis. This
system is the fastest possible interbank money transfer facility available through secure
banking channels in India. RTGS transaction requests will be sent to RBI immediately
during working hours post working hours requests are registered and sent to RBI on next
working day. You can also schedule a transaction for a future date. You can transfer an
amount of Rs.1 lac and above using RTGS system. National Electronic Funds Transfer
(NEFT) facilitates transfer of funds to the credit account with the other participating
bank.

-44-
 RBI acts as the service provider and transfers the credit to the other bank's
account. NEFT transactions are settled in batches based on the following timings

1. 6 settlements on weekdays - at 09:00, 11:00, 12:00, 13:00, 15:00 and 17:00 hrs.

2. 3 settlements on Saturdays - at 09:00, 11:00 and 12:00 hrs.

Please note that all the above timings are based on Indian Standard Time (IST)
only. In order to transfer the funds to an account with other bank, kindly ensure that the
bank branch of the beneficiary is covered under the RGTS/NEFT payment system. It is
recommended that you choose the Bank/ Branch from the drop down option provided
under the link "Add Interbank beneficiary" and exercise care to provide the correct
account number and name of the beneficiary.

E-PAYMENT

You can pay your insurance premium, mobile phone bills and also you can purchase
mutual fund units by coming from the biller‟s website and selecting state bank of India in
the payment option. LIC PREMIUM: For paying premium of LIC policy logon to
www.licindia.com and register your policy details. When the premium is due select State
Bank of India in the make payment option. SBI Mutual FUND: You can invest in the SBI
Mutual Fund schemes online. Logon to www.sbimf.com and select the scheme in which
you want to make investment in the payment option select State Bank of India.

CC Avenue: Enjoy shopping at the CC Avenue Shopping Mall and purchase from a wide
variety of products and services through CC Avenue Certified Vendors. Make payments
for your purchases using your Internet enabled SBI accounts.

-45-
FUND TRANSFER

The Funds Transfer facility enables you to transfer funds within your accounts in
the same branch or other branches. You can transfer aggregating Rs.1 lakh per day to
own accounts in the same branch and other branches. To make a funds transfer, you
should be an active Internet Banking user with transaction rights. Funds transfer to PPF
account is restricted to the same branch.

Just log on to retail section of the Internet Banking site with your credentials and
select the Funds Transfer link under Payments/Transfers tab. You can see all your online
debit and credit accounts. Select the debit account from which you wish to transfer funds
and the credit account into which the amount is to be credited.

Enter the amount and remarks. The remarks will be displayed in your accounts
statement for this transaction. You will be displayed the last five funds transfer operations
on your accounts. On confirming the transaction, you will be displayed a confirmation
page with the details of the transaction and the option to submit or cancel the funds
transfer request. A reference number will be generated for your record.

THIRD PARTY TRANSFER

You can transfer funds to your trusted third parties by adding them as third party
accounts. The beneficiary account should be any branch SBI. Transfer is instant. You can
do any number of Transactions in a day for amount aggregating Rs.1lakh. To transfer
funds to third party having account in SBI, you need to add and approve a third party,
you need to register your mobile number in personal details link under profile section.
You will receive a One Time SMS password on your mobile phone to approve a third
party. If you do not have a mobile number, third party approval will be handled by your
branch. Only after approval of third party, you will be able to transfer funds to the third
party. You can set limits for third party transactions made from your accounts or even set
limits for individual third parties.

-46-
DEMAND DRAFT

The Internet Banking application enables you to register demand drafts requests
online. You can get a demand draft from any of your Accounts (Savings Bank, Current
Account, Cash Credit or Overdraft). You can set limits for demand drafts issued from
your accounts or use the bank specified limit for demand drafts. You can opt to collect
the draft in person at your branch, quoting a reference to the transaction. A printed advice
can also be obtained from the site for your record. Alternatively, you may request the
branch to courier it to your registered address, and the courier charges will be recovered
from you.

CHEQUE BOOK REQUEST

You can request for a cheque book online. Cheque book can be requested for any
of your Savings, Current, Cash Credit, and Over Draft accounts. You can opt for cheque
books with 25, 50 or 100 cheque leaves. You can either collect it from branch or request
your branch to send it by post or courier. You can opt to get the cheque book delivered at
your registered address or you can provide an alternate address. Cheque books will be
dispatched within 3 working days from the date of request. Just log on to retail section of
the Internet Banking site with your credentials and select the Cheque Book link under
Requests tab. You can view all your transaction accounts. Select the account for which
you require a cheque book; enter the number of cheque leaves required and the mode of
delivery. Then, submit the same.

ACCOUNT OPENING REQUEST

Online SBI‟ enables you to open a new account online. You can apply for a new
account only in branches where you already have accounts. You should have an INB-
enabled account with transaction right in the branch. Funds in an existing account are
used to open the new account. You can open Savings, Current, Term Deposit and
Recurring Deposit accounts of Residents, NRO and NRE types. Just log on to retail
section of the Internet Banking site with your credentials and select the New Account link
under Requests tab.

-47-
 You can see all types of accounts. Select the account and account type you wish
to open and submit the same. Then, you need to select the branch and enter the initial
amount to open the account. You can select any of your accounts for debiting the initial
amount. Then, submit the transaction. Your new account opening request will be
processed by the branch.

ACCOUNT STATEMENT

The Internet Banking application can generate an online, downloadable account

statement for any of your accounts for any date range and for any account mapped to
your username. The statement includes the transaction details, opening, closing and
accumulated balance in the account. You can generate the online account statement for
any date range or for any month and year. The account statement can be viewed online,
printed or downloaded as an Excel or PDF file. You also have the option to select the
number of records displayed in each page of the statement. The options are 25, 50, 75,
100 and ALL.

TRANSACTION ENQUIRY

Online SBI‟ provides features to enquire status of online transactions. You can
view and verify transaction details and the current status of transactions. Your VISA
transactions can also be viewed separately. Just log on to retail section of the Internet
Banking site with your credentials and select the Status Enquiry link under the Enquiries
tab. You will be displayed all online transactions you have performed. To view details of
individual transactions, you need to click the Transaction Reference number link. You are
displayed the debit and credit account details, transaction amount, narration and
transaction status.

-48-
DEMAT ACCOUNT STATEMENT

Online SBI‟ enables you to view Demat account statement and maintain such
accounts. The bank acts as your depository participant. In the third party site, you can
mark a lien on your Demat accounts and use the funds to trade on stock using funds in
your SBI savings account. You can view Demat account details, and generate the
following statements: statement of holding, statement of transactions, statement of
billing.

DONATION

You can make donation to religious and charitable institution by using Internet
Banking of SBI. Simply log on to http://www.onlinesbi.com/ with your credentials and
go to Payment and transfer and click on make donation link. After selecting the debit
account select the religious/charitable institution that you want to offer donation. After
successful payment you can print an E-receipt for the donation made.

CUSTOMERS PERSPECTIVE

From the customers perspective, it was also decided to collect at least 100
questionnaires from the different branches of SBI in approx equal representation
therefore, a total of 120 questionnaires were floated in these branches using on
convenience basis. Self-administered approach was applied for data collection and
surveys were completed anonymously and returned to the researchers. At the end total
108 responses were received and finally 100 questionnaires were selected randomly and
analyzed through cross tabulation techniques.

-49-
 ANALYSIS OF DATA

The data is analyzed through the cross tabulation with the help of SPSS as given
below: Bank Technological Development * Better Customer Service

Table 2.1 – Customer Service

With the help of above data interpretation and graphical presentation, it is easily observed
that bank customers definitely believe in a fact that technological development in banking
sector is extremely important. They also advocate that technological development in
banking sector improves customer services to a large extent.

-50-
Bank Technological Development * Bank Brand Name

Table 2.2 – Bank Brand Name

Above analysis shows that banking industry with high and modern technology is treated
as brand banking. The customers believe banks have to adopt new technology to become
a brand.

-51-
Bank Technological Development * Bank Competitive Ability

Table 2.3 – Bank Competitive Ability

This can be concluding that increase in adoption of modern technology by banks

improves their competitive ability too. It is because private banks with more advanced
technology have become better competitors of nationalized banks.

-52-
Bank Technological Development * Bank Loyalty

Table 2.4 – Bank Loyalty

Here, we found that technological adoption by banks also influence customer

loyalty but not to large extent. However, a large proportion of respondents believe that
technology improves services which directly influence loyalty, but some of them do not
believe the same. According to them, loyalty is influenced but to a small level.

-53-
CHANGES BROUGHT IN INFORMATION TECHNOLOGY BY SBI

 In the next decade internet facility was provided for individuals.

 All SBI branches were connected and ATM‟S were launch

 2001 - KMPG appointed consultant for preparing IT Plan for the Bank.

 Later on Core banking proposed by the IT consultancy company.

 2002 – All branches computerized but on decentralized systems, there

the initiative of core banking took place

 2008- more than 6500 branches (95% of business) on Core Banking

Solution (CBS)

 Internet Banking facility for Corporate customers were also launched in early
2008

 More Interfaces developed with e-Commerce & other sites through alternate
channels like ATM & Online Banking.

 All Foreign Offices were brought on Centralized Solution

 Large network is playing the role of backbone for connectivity across the country

-54-
SWOC ANALYSIS OF HDFC’S INTERNET BANKING

STRENGHT

 HDFC bank is the second largest private banking sector in India having
2,201 branches and 7,110 ATM’s

 HDFC bank is located in 1,174 cities in India and has more than 800 locations to
serve customers through Telephone banking

 The bank’s ATM card is compatible with all domestic and international
Visa/Master card, Visa Electron/ Maestro, Plus/cirus and American Express. This
is one reason for HDFC cards to be the most preferred card for shopping and
online transactions

 HDFC bank has the high degree of customer satisfaction when compared to
other private banks

 The attrition rate in HDFC is low and it is one of the best places to work in private
banking sector

 HDFC has lots of awards and recognition, it has received ‘Best Bank’ award from
various financial rating institutions like Dun and Bradstreet, Financial express,
Euromoney awards for excellence, Finance Asia country awards etc

 HDFC has good financial advisors in terms of guiding customers towards right
investments

-55-
WEAKNESS

 HDFC bank doesn’t have strong presence in Rural areas, where as SBI bank its
direct competitor is expanding in rural market

 HDFC cannot enjoy first mover advantage in rural areas. Rural people are
hard core loyals in terms of banking services.

 HDFC lacks in aggressive marketing strategies like SBI

 The bank focuses mostly on high end clients

 Some of the bank’s product categories lack in performance and doesn’t

have reach in the market

 The share prices of HDFC are often fluctuating causing uncertainty for
the investors

-56-
OPPORTUNITIES

 HDFC bank has better asset quality parameters over government banks, hence
the profit growth is likely to increase

 The companies in large and SME are growing at very fast pace. HDFC has
good reputation in terms of maintaining corporate salary accounts

 HDFC bank has improved it’s bad debts portfolio and the recovery of bad debts
are high when compared to government banks

 HDFC has very good opportunities in abroad

 Greater scope for acquisitions and strategic alliances due to strong

financial position

-57-
CHALLENGES

 HDFC’s nonperforming assets (NPA) increased from 0.18 % to 0.20%. Though it

is a slight variation it’s not a good sign for the financial health of the bank

 The non banking financial companies and new age banks are increasing in India

 The HDFC is not able to expand its market share as SBI imposes major threat

 The government banks are trying to modernize to compete with private banks

 RBI has opened up to 74% for foreign banks to invest in Indian market

-58-
SWOC ANALYSIS OF SBI’S INTERNET BANKING

STRENGTHS

 Greater reach to customers

 Quicker time to market

 Ability to introduce new products and services quickly and successfully

 Ability to understand its customers‟ needs

 Customers are given access to information easily across any location

 Greater customer loyalty

 Easy online application for all accounts, including personal loans and mortgage

 24 hours account access

 Quality customer service with personal attention

-59-
WEAKNESSES

 Lack of awareness among the existing customers regarding internet banking

 Obsolesce of technology take place very soon specially in terms of security on

internet.

 Procedure for applying for id and password for using services related to internet
banking takes time.

 Lack of knowledge is found regarding internet banking in employees of SBI

 Implementation of newer technology is little bit complicated

 Employees needs training to obtain knowledge regarding I-banking

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OPPORTUNITIES

 Approximately 95% of customers are not using internet banking.

 Core competency can be achieved in terms of banking if focus is made on

awareness of internet banking

 Can become 1st virtual bank of India.

 Concentration of various services should be made using internet banking

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CHALLENGES

 Maintaining Business Edge over competitors in the context of sameness in

IT infrastructure

 Multiple vendor support is necessary for working of highly complex technology

 Maintaining secured IT infrastructure for business operations

 Alternative must be there in case of failure of system

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 STATEMENT OF THE STUDY

NEED & PURPOSE

After conducting a review of researches done by various professionals a gap have

been identified. The researchers had studied the aspects of internet banking, its
introduction, its development, adoption by the customers, consumer’s perception about
this service, its success and security related issues. But a very few researchers had studied
the net banking service with respect to the HDFC Bank. This gap had been identified and
it handled to the present research being undertaken

This study is needed to find out the working of Internet Banking of SBI and its
importance to customer as well as to bank.

The main objectives of the study are: To understand the concept of Internet
banking and importance, to bank as well as customers.

 To get aware of various aspects of net banking

 To build up SWOC analysis of Internet banking of HDFC & SBI

 To build up various solutions for drawbacks in net banking

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 OBJECTIVES OF THE STUDY

The current study was undertaken to achieve the following stated objectives:

1. To analyze awareness among customers using Net banking service.

2. To know about the Net Banking service provided by HDFC & SBI Bank.

3. To know the cause why customers are using or not using Net banking service.

4. To the confidence of the customers of HDFC & SBI Bank in using these services.

5. To study the popularity of the Net banking service among the customers of HDFC &
SBI Bank.

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 SCOPE OF THE STUDY

The area where the study has been conducted was Mumbai

The study is made taking consideration of whole State Bank of India. It investigates
about all applications of online banking in HDFC & SBI. It would help society to
understand the usefulness of on- line banking. The study will also help to get the
knowledge about process of internet banking and usefulness to banking industry. As the
study contains the 360 degree information regarding HDFC & SBI and its internet
banking, Hence the study will lead to new ways to tackle the problems and the SWOC of
HDFC & SBI in respect of internet banking..

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 DATA COLLECTION AND ANALYSIS

DATA COLLECTION

There were two types of data sources used in this research. These were

 Secondary data

Secondary data is the data collected from already been use or published information like
journals, diaries, books, etc .In this research project, secondary source used were
various journals, and website of various online journals.

 Primary data

Primary data is the data collected for the first time from the source and never have
been used earlier. The data can be collected through interviews, observations and
questionnaires. In this project, an appropriate questionnaire was designed which was
filled by the customers of HDFC & SBI Bank to know their opinions regarding the Net
Banking service provided by HDFC & SBI Bank.

DATA ANALYSIS

 Tools Of Presentation

It means what all tools are used to present the data in a meaningful way so that
it becomes easily understandable. In this research tables and graphs were used
for presenting the data.

 Tools Of Analysis

In this research the tools of analysis used were percentages. SPSS software were used to
conduct Friedman Anova, Reliability analysis and Factor Analysis.

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 LIMITATIONS OF THE STUDY

The following were the limitations of the study:

1. Non representative sample:

In this research project a sample survey wasconducted. A sample of 100 respondents was
selected. So such sample size cannot be said to be the true representative of the universe.

2. Shortage of time:

The time period of study was very limited. It is very difficult tohave in detail study on
project work due to limited time period. The period of 4 to6 weeks is not enough for the
proper study of the project.

3. Inadequate data:

The data provided was not up to the mark due to which wefaced problems in our
research.

4. Lack of scientific method:

The lack of scientific training in methodology of research was great impediment in our
research program, which led to the delay of research

5. Biasness in the responses:

The answers provided by the respondents suffer from biasness.

6. Cost Factor:

It was not possible to conduct extensive research due to paucity of funds.

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 Chapter 2: RESEARCH METHODOLOGY

This research paper is based on secondary data which is to be collected from the
official website of HDFC BANK, State Bank Of India and Reserve Bank of India.

Research is a common parlance which refers to search for knowledge. It is a

procedure of logical and systematic application of the fundamentals of science to the
general and overall questions of a study and scientific technique, which provide precise
tools, specific procedures, and technical rather philosophical means for getting and
ordering the data prior to their logical analysis and manipulating different type of
research designs is available depending upon the nature of research project, availability
of manpower and circumstances.

According to D. Slesinger and M. Stephenson research may be defined as “the

manipulation of things, concepts or symbols for the purpose of generalizing to extend,
correct or verify knowledge, whether that knowledge aids in the construction of theory or
in the practice of an art”. Thus it is original contribution to the existing stock of
knowledge of making for its advancement. In short, the search of knowledge through
objective and systematic method of finding solution to a problem is research.

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 was descriptive in nature.

DESCRIPTIVE RESEARCH

The research undertaken was a descriptive research as it was concerned with

specific predictions, with narration of facts and characteristics concerning net banking
service provided by HDFC Bank.

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SAMPLING DESIGN

The following factors have been decided within the scope of sample design:

 Universe Of Study

Universe of the study means all the persons who are the customers of HDFC Bank & SBI
Bank in the world.

 Theoretical

It covered all the individuals who are the customers of HDFC Bank in the world.

 Accessible

It covered all the individuals who are the customers of HDFC Bank in India who are
within our reach. In this study accessible population wascustomers of HDFC Bank in
India.

 Sample Size

A sample of minimum respondents was selected from various areasof Jalandhar. An

effort was made to select respondents evenly. The survey wascarried out on 100
respondents.

 Sample Unit

In this project sampling unit consisted of the various individualswho had their bank
accounts with HDFC Bank.

 Sampling Technique

For the purpose of research convenient sampling techinquewas used.

 Sampling Frame

It consisted of various sources from where information aboutthe respondent is

extracted. Mainly personal links and employees of HDFC Bank,Jalandhar are used for
getting information about the respondents

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 Chapter 3: LITERATURE REVIEW

A number of researches have been conducted on net banking and its adoption,
development and its perils. Due to shortage of time and resources, a review of all the past
researches done could not be mentioned in this research project. So, a snapshot of some
of the reviews has been presented.

Diversification has been one of the most frequently researched areas in strategic
management literature and to some extent in finance. Many studies have been conducted
on factors influencing performance of banks. The internal determinants originate from
the financial report of the bank concerned and are often termed as micro or bank-specific
determinants of profitability. The external determinants are those forces that reflect the
economic environment which conditions the operation and performance of financial
institutions.

Panda and Lall (1991)

Had identified certain factors which influence the profitability improvement of

banks to the great extent. They argued that branch expansion is one of those factors
which can impact on profitability.

Rammohan and Ray (2004)

Concluded that with regard to the revenue maximizing efficiency, public sector
banks are significantly better than private banks but they found no significant difference
between public and foreign banks on this parameter.

Gilotra (2003)

In his study on retail lending, views that the success of retail lending of a bank
depends on factors like marketing efficiency, proper appraisal and follow-up. He also
finds that HDFC has become very excellent in housing finance solely due to the long
term strategies adopted by them.

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Kumar (2006)

Observed that the bank nationalization in India marked a paradigm shift in the
focus of banking as it was intended to shift the focus from class banking to mass banking
and efforts are also being made internationally to study causes of financial inclusion and
designing strategies to ensure financial inclusion of the poor disadvantaged. He argued
that the banks also need to redesign their business strategies to incorporate specific plans
to promote financial inclusion of low income group treating it both a business
opportunity as well as a corporate social responsibilities and financial inclusion can
emerge as commercial profitable business.

Venkatesan (2007)

Viewed that the net interest margin has come down over the last one decade with
increased competition in the banking industry. He viewed that banks will look for fee
based income to fill the gap in interest income.

Bennaceur and Goaied (2008)

Examined factors affecting profitability for the period 1980-2000 and suggested
that capital and overhead expenses are positively related to profitability level.

Kosmidou (2008)

Findings suggest that the more profitable banks have higher level of capital and
lower cost to income ratio.

Manoj (2010)

Argued that enhanced profitability and efficiency has become vital for survival
and growth of the banks in the era of globalization and significantly affected by asset
quality, capital adequacy and liquidity of the banks.

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Ghosh (2010)

Examines the interplay between credit growth bank soundness and financial
fragility in Indian banks. The soundness of banks is measured by their distance to default.
Loan growth is often directly associated with soundness but an extension could weaken
bank soundness.

Anjum and Deepika (2012)

Made a comparative study of the profitability of the Indian Banking Sector and
the impact of technological investment on the profitability of the Public and Private
Sector Banks. They argued that Indian Banking Industry in technological advancement is
still in gestation phase and RBI has to take various steps so that the Public Sector Banks
(Nationalized and SBI & its Associates) becomes able to manage their profitability by
striking the balance between technological Investments (Expenditures) and Incomes.

Ayyappan and Sakthivadivel (2012)

Found that compound growth rate of the private sector banks is comparatively
higher than that of the public sector banks. The banks were grouped into two categories:
i.e., Public Sector Banks Group (22 banks) and Private Banks Group (15 banks). Their
study predicted that at the current rate of growth the private sector banks can pose a
challenge in the market place and may even overtake the public sector banks in the longer
period of time. The study does not provide any idea regarding the growth of any
individual or frontline public and private sector commercial banks but the growth picture
at macro level.

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Nath et.al (2001)

In their study found that in every industry, E-commerce is revolutionizing the way
business is conducted. New business models are replacing out dated ones and
organizations are rethinking business process designs and customer Relationship
management strategies. Banks are no exception to this transformation. This study
examines bankers' views on providing banking services to customers using the web.
Specifically, it addresses issues such as the strategic need for Internet banking, its effect
on customer-bank relationships, and customers' experiences in Internet banking. Data
collected from 75 banks show that most banks do not yet offer full-fledged Internet
banking. However, most have plans to do so. Furthermore, bankers see Internet banking
as a strategic opportunity that can reduce transaction costs, enhance customer service,
increase the customer base and improve cross-selling opportunities. Also, Internet
banking is perceived more favorably by banks that offer it compared to those that do not.

Corrocher (2002)

In his study examined the drivers of the adoption of the Internet banking, in order
to understand its role with respect to the traditional banking activity and to offer a
comprehensive picture of the diffusion of such a technology within the sector. In doing
so, it analyses the role of firm-specific and non-firm-specific (technology, market, and
environment) characteristics in influencing the decision to adopt the new technological
platforms to perform on-line banking transactions within the retail segment of the
financial sector. The main purpose of this paper is to investigate the relationship between
the Internet banking and the traditional banking activity, in order to understand if these
two systems of financial services delivery are perceived as substitutes or complements by
the banks.

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Leary (2002)

In his study examined how Internet or electronic banking is slowly but surely
reviving itself after numerous attempts by various financial institutions and financial
intermediaries in the 1970 and 1980s. The standardization in technologies and the
public's familiarity with the use of personal computers and the Internet have made the
Internet bank or Internet banking site easier, cheaper and more cost effective than ever
before. This paper discusses the coming of age of Internet banking, the opportunity for
Internet banking and some of the obstacles and procedures that must be followed in order
to develop a sound Internet banking presence.

Bradley & Stewart (2003)

Conducted a research in which they studied the factors driving the adoption of
internet banking. The financial services environment has been subject to changes on
many fronts. Technological change and the advent of the Internet are among the most
dramatic and challenging areas of change for the sector. This paper looks at retail
banking and its adoption of online banking, in particular the factors driving and inhibiting
adoption by banks. An international Delphi study confirms the high level of importance
of the Internet for retail banking. By 2011, it is expected that bank adoption of the
Internet will be near universal. The key factors that are driving banks to adopt online
banking are the adoption by other banks, competitive forces, consumer demand and the
availability of technology. Working against adoption are banks' perceptions that the
Internet does not offer enhanced ability to deal with customers as well as bank resistance
to change, their existing legacy systems and the resources required to adopt.

Singh & Malhotra (2004)

In their study found that the tremendous advances InTechnology and the aggressive
infusion of information technology had brought in a paradigm shift in banking
operations. The purpose of this paper is to help fill significant gaps in knowledge about
the Internet banking landscape in India. The paper presents data, drawn from a survey of
commercial banks websites, on the number of commercial banks that offer Internet
banking and on the products and services they offer.

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 It investigates the profile of commercial banks that offer Internet banking, using
univariate statistical analysis, relative to other commercial banks with respect to
profitability, cost efficiency, and other characteristics. By the end of first quarter, 2004,
differences between Internet and non-Internet banks had begun to emerge in funding, in
sources of income and expenditures and in measures of performance. It was also found
that the profitability and offering of Internet banking does not have any significant
correlation.

Laukkanen & Tommi (2007)

In their research aimed to compare customer perceived value and value creation
between internet and mobile bill paying service. A qualitative in-depth interviewing
design was applied in order to ascertain the factors that create value perceptions in fund
transfer service via personal computer and mobile phone. The findings suggest that
efficiency, convenience and safety are salient in determining the differences in customer
value perceptions between internet and mobile banking. The findings of the qualitative
study, being more depth than wide in nature, deserve to be quantitatively measured in
future studies in order to provide more generalized results. The paper provides enhanced
information for business managers about both positive and negative customer value
perceptions in internet and mobile banking. By understanding how and what kind of
value different service channels provide for customers service providers are better
enabled to create actions to enhance internet and mobile banking adoption. The
contribution of the paper lies in achieving a more profound understanding on consumer
value perceptions to internet and mobile banking. It expands the literature on electronic
and mobile commerce and on electronic banking especially.

Nandan et.al (2008)

In his paper discusses the concept of Internet Banking, perception of Internet bank
customers, non-customers and issues of major concern in Internet banking. The state of
Internet banking in India has been explored using various concepts like E- banking
continuum, and gap analysis related to the various services and the security features
offered. In order to have a clear and focused insight about the perceptions of users (and

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non-users) about Internet banking a survey was conducted. The findings of the survey
provide valuable insights into concern for security, reasons for lower penetration, and
likeliness of adoption, which have been used to make useful recommendations.

Mishra & Kiranmai (2009)

In their study found that information technology is considered as the key driver
for the changes taking place around the world. According to Heikki, the transformation
from the traditional banking to e-banking has been a 'leap'change. The evolution of e-
banking started from the use of Automatic Teller Machines(ATMs) and telephone
banking (tele-banking), direct bill payment, electronic fund transfer and the revolutionary
online banking. The future of electronic banking would be more interactive i.e., TV
banking. Finland is the first country in the world to have taken a lead in e-banking. In
India, ICICI Bank initiated e-banking services during 1997 under the brand name
'Infinity'. It has been forecasted that among all categories, online banking is the future of
electronic financial transactions. The rise in e-commerce and internet in

Enhancing online security transformation and sensitive information has been the core
reason for the penetration of online banking in everyday life. The shift towards the
involvement of the customers in the financial service with the help of technology,
especially internet, has helped in reducing costs of financial institutions as well as
clients/customers who use the service at any time and from virtually anywhere with
access to an internet connection.

Up pal (2009)

In his study found that

In the post-LPG (Liberalization, Privatization and Globalization) era and Information

Technology (IT) era, transformation in Indian banks is taking place with different
parameters and the contours of banking services are dynamically altering the face of
banking, as banks are stepping towards e-banking from traditional banking. On the basis
of five-point liker-type scale, this paper empirically analyzes the quality of e-banking
services in the changing environment. With different statistical tools such as weighted

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average method and ranking, the paper concludes that most of the customers of e-banks
are satisfied with the different e-channels and their services, but the lack of awareness is a
major obstacle in the spread of e-banking services. The paper also suggests some
measures to make e-banking services more effective in the future.

Kuisma et.al (2006)

Conducted a research to identify the reasons for consumer resistance to Internet

banking. The special interest is to explore resistance among those bank customers who
already have valid contracts for Internet banking but prefer to pay their bills via ATM.
The objective is to identify those characteristics generating resistance to Internet banking
and their connections to values of individuals.

In order to achieve the objective, 30 Finnish bank customers were interviewed in-
depth using the means-end approach and the laddering interviewing technique. The
findings indicate both functional and psychological barriers arising from service-,
channel-, consumer- and communication-related means-end chains inhibiting Internet
banking adoption. The contribution of the paper lies in achieving a more profound
understanding of consumer resistance to Internet banking, and further, in offering
suggestions and practical advice for service providers' decision-making.

The perusal of review of literature revealed that the internet banking had been
studied in relation to various aspects like its adoption, growth, development and
expectations of the customers. But no study has been conducted in relation to the Net
Banking service provided by HDFC Bank.

Singh (1990)

Has studied the productivity in the Indian Banking Industry. He has studied Intra-
bank, Inter-Bank groups and inter-bank groups productivity of public sector banks and
SBI group. He has analyzed branch productivity, per employee productivity, and
financial parameters at constant prices. But his study does not consider nationalized
banks and causes of varying productivity in banks.
Sayuri, Shirai (2002)

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 Examine the impact of reforms by in the performance of banking sector. He found
that the performance of public sector bank improved in the second half of the 1990's.
Profitability (measured by return on assets) of nationalized banks turned positive in 1997-
2000 and that of SBI banks have steadily improved their cost efficiency over the reform
period.

Yash Paul Pahuja (2003)

Said, "SBI is one of the fast growing players in the Indian Banking Industry with
around 13,000 branches (including its seven associate banks) and 51 foreign offices in 31
countries. These branches handle 25 million transactions a day. The cost of funds is
lowest for SBI at 7.6% as compared to others".

Uppal (2006)

In his study the “Survival of public sector banks in the post LPG era” studied the
profitability of SBI and its associates, nationalized banks, new private sector banks and
foreign banks in the post-reforms era. He finds that there is a significant difference in the
profitability of major bank groups

Vyas and Dhade (2007)

Who conducted a study on “The impact of new private sector banks on State Bank
of India” observe that the new private sector banks are not a threat to the SBI at present
but the situation may change in future. The SBI with a vast net work of branches and
presence is able to compete with these banks at present.

Pankaj Kumar (2009)

In his article “Customer relationship management in retail banking” highlights

that Customer relationship management is especially useful for large banks like SBI
which are spread across different locations. For CRM to be truly effective, it requires a
well thought out initiative involving strategy, people, technology and process.

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Neeru Mundrai, Kamni Tandon, Nidhi Malhotra (2011)

Excel books found that there is significant impact on the SBI’s performance due
to entry of new private sector banks as the new banks are profit oriented institutions
while traditional banks are operating with the shackles of social responsibility towards
the society.

Pawankumar Avdhanam and Sriniwas Kolluru, Ramkrishne Fonnd, (2013)

In their study that state bank group other than SBI home finance has performed
better throughout the period of study. Though there was a decline in PAT for the year
2000-01 but then there was continuous rise in PAT. Most public sector banks have
performed better over year.

A significant number of studies on performance of banks have already been undertaken.

Though profitability and efficiency of the banks have become most fascinating area for
study but with the view of growth in economy, the importance of financial performance
in banking sector cannot be ignored. The comparative analysis of growth performance
among two leading banks i.e. SBI and HDFC bank before and after the world economic
crisis of 2008 at bank level is an area which has not yet explored.

The conclusive sum of this retrospective review of relevant literatures produced

till date on the offered subject reveals wide room for the validity and originates of this
work and reflects some crucial clues that affirm its viability, as may be marked here it.
No study has incorporated the growth performance of two leading Banks under study in
India. The comparative analysis of growth performance among SBI and frontline new
private sector commercial banks as well as growth performance before and after the
world economic crisis of 2008 at bank level is an area which has not yet explored. The
present study will try to analyze and compare the growth of the largest public sector SBI
and the new private sector bank HDFC.

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 The Banking industry occupies a unique place in a nation’s economy. A well
developed banking system is a necessary precondition for economic development in a
modern economy. Keeping in view, the importance of banks in nation’s development, the
general objective of the study is to evaluate the overall growth performance of two
leading banks in India – SBI and HDFC in private and public sector over a period of 10
years (2005-06 to 2014-15).

More specifically, the intention of the study is to:

 To study the growth rate of both the banks under study.
 To compare the growth of the banks in private and public sector.

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 Chapter 4: DATA ANALYSIS / INTERPRETATION /
PRESENTATION

Demographic Profile of the Respondents

Analysis and interpretation:

From the data collected it was found majority of respondents that is 40%
belonged to the age of 35 to 50
years, followed by the age
group of 20 to 35 years. It was
found that the majority of the
respondents were graduates. It
was found that the majority of
the respondents were from the
business class followed by the
service class and self employed
people. It was found that the
majority of the respondents fell
between the income group of Rs
6 to Rs 10 lakhs, followed by
income group between Rs 2 to
Rs 6 lakhs. Thus it can be
concluded that the majority of
the respondents were
knowledgeable and were well
informed about the banking
services Table 3.1 – Demographic

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 Time period since the HDFC Bank’s services are being availed

Table 3.2 – HDFC Services

Analysis and interpretation:

From the data collected, it can be that the majority of the respondents that is 42%
of the respondents have been HDFC Bank’s customer for more than 10 years, followed
by 5 to10 years with 31% of respondents. It can be concluded that the majority of the
respondents have been HDFC Bank’s customer for more than 10 years

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 Products and services of SBI Bank availed by the customers

Table 3.3 – SBI Customers

Analysis and interpretation

It was found that majority of the respondents that is 29% availed deposit accounts,
followed by loans, credit cards, ATM’s and forex services with 23%, 12%, 11% and
10%respectively.It can be inferred that that majority of the respondents availed the
deposit accounts among the various products and services offered by the SBI Bank.

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 Perception about the products and services offered by HDFC Bank

Table 3.4 – HDFC Product & Services

Analysis and interpretation

From the data collected, it was found that the majority of the respondents that is
85% said that the products and services offered by HDFC Bank were lucrative. While
just 5% of the respondents said that the products and services offered were non lucrative
and the remaining 15% were not able form any opinion. It can be inferred that the
majority of the felt that the products and services offered by HDFC Bank were lucrative.

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 Ways to access to HDFC Bank

Table 3.5 – HDFC Access

Analysis and interpretation:

It was found from the data collected that 33% of the respondents accessed the
bank through Branch network. About 23% of the respondents accessed the bank through
net banking followed by email statements with about 15%. Marginally 1% and 3% of the
respondents used insta alert and one view to access the bank. It was inferred that majority
of the respondents accessed the bank through branch network.

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 Awareness regarding Net Banking Service provided by SBI Bank

Table 3.6 – SBI Awareness

Analysis and interpretation:

From the data collected it was found that majority of the respondents that is 96%
were aware of the net banking service provided by SBI Bank while just 4% of the
respondents were not aware of the same service. It was concluded that majority of the
respondents of the respondents were aware of the net banking service.

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 Accessibility of Net Banking Facility provided by HDFC Bank

Table 3.7 – HDFC Net banking facility

Analysis and interpretation:

Of the data collected it was found that about 81% of the respondents had accessed
the net banking service provided by the HDFC Bank while 19% of the respondents said
that they had not accessed the same. It can be inferred that the majority of the
respondents had availed the net banking service.

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 Reasons for which Net Banking service should be availed

Table 3.8 – Reasons

Analysis and interpretation:

Scores are significantly different on The Friedman two way ANOVA test
(p<0.001) for the listed 7 reasons due to which Net Banking service should be availed.
The first ran being the most important was given to convenience and the last rank that is
7 was given to curiosity. It can be concluded that majority of the respondents regarded
convenience as the most important reason for which Net Banking service should be
availed and curiosity as the least important reason for the same.

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 Chapter 5: FINDINGS / SUGGESTIONS AND CONCLUSION

This study states that internet banking provides greater reach to customers.
Feedback can be obtained easily as internet is virtual in nature. Customer loyalty can be
gain. Personal attention can be given by bank to customer also quality service can be
served. After studying the SWOC analysis, we came to know various strengths of HDFC
& SBI such as quality customer service, greater reach, customer loyalty, easy access to
information, 24 hours access, easy online applications etc. HDFC & SBI should put
efforts to multiply the number of strengths. In terms of weakness I come to know some of
the major weaknesses they are lack of awareness of internet banking among the
customers, obsolesce of technology related to security, complicated procedures of
availing internet banking facilities, lack of knowledge among the employees of HDFC &
SBI.

HDFC & SBI should concentrate on the weaknesses and reduce them to zero.

The findings of the study were as follows:

1. The majority of the respondents have been HDFC Bank’s customer for more than10
years.

2. The majority of the respondents availed the deposit accounts among the various
products and services offered by the SBI Bank.

3. The majority of the felt that the products and services offered by HDFC Bank were
lucrative.

4. The majority of the respondents accessed the bank through branch network.

5. The majority of the respondents of the respondents were aware of the net banking
service.

6. The majority of the respondents have availed the net banking service.

7. The majority of the respondents used the net banking service provided by SBI Bank to
view their accounts and balances.

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8. The majority of the respondents regarded convenience as the most important reason for
which Net Banking service should be availed and curiosity as the least important reason
for the same.

9. The majority of the respondents availed the Net Banking service one to three times in a
month.

10. The majority of the respondents faced the safety issues was the major difficulty that
they faced while using the Net Banking service.

11. The majority of the respondents said that they visited the bank branch every alternate
day.

12. The majority of the respondents said that the main reason of visiting the bank is to
make a deposit.

13. The majority of the respondents felt that the net banking service was better than
traditional banking.

14. The majority of the respondents regarded that the most important reason for which
Net Banking service is not being used popularly was that it does not offer receipts on
payments and the least important reason was that it is more expensive than going to a
branch.

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 CONCLUSION

The introduction of new technology has been changing the attire of banking. The
brick and mortar banking is slowly giving place to click of the mouse banking.
Technology is aiding 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, banks today offer the
customer a choice to conduct his business across the counter, over phone or via a
computer. The Rangarajan Committee (1988) report is the first step for the introduction
of computers. The Saraf Committee (1994) on Technology issues relating to payments,
cheques clearing and securities settlements made several recommendations to improve
the quality of service. The introduction of new instruments such as ATM, retail
Electronic Funds Transfer (EFT) and Electronic Clearing Services (ECS) have all helped
in developing an effective, efficient and speedy payment and settlement systems. In
literature, the major emphasis has laid on significant innovation and investment is under
way that could lead to very rapid expansion in fully electronic business to business and
consumer to consumer payments in near time. While the pace of change in this market
makes it difficult to determine, eventually these innovations will generate substantial
efficiencies in retail payment system. Bank regulators are paying significant attention to
appropriate risk management of new technology. Evidence reveals a sense of urgency
about the adoption of new technology and reflects substantial competitive pressure to act
quickly. The objective of the study was to study was to comprehend the Net Banking
service provided by HDFC & SBI Bank.

The research was descriptive in nature. The universe of the study was the
customers of the HDFC & SBI Bank. The survey was carried out on 100respondents. In
this research for data analysis tools used were tables and graphs. Majority of the
respondents were aware of the Net Banking service provided by the bank and availed the
various services offered through net banking. Majority of the respondents felt that net
banking facility have enabled the customers to perform various banking transactions
online. It is hoped that the survey findings will have some useful applications.

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 RECOMMENDATIONS

Following are the recommendations of the study:

1. The bank should make some efforts to familiarize the customers to various services
through demonstrations.

2. The bank should adopt more upgraded techniques to make their customer feel more
secure while accessing their accounts.

3. Effective awareness campaigns should be undertaken by the banks to make their

customers more aware of net banking service.4.The bank should make a effort to provide
a platform from where the customers can access different accounts at single time without
extra charge.5.The bank should take steps to create a trust in mind of customers towards
security of their accounts.

6. The HDFC bank should introduce more services which can be accessed through Net
Banking like advice on investment, TDS, etc

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 APPENDIX / ANNEXURE

LIST OF TABLES LIST OF IMAGES

Table 1.1 personel banking Image 1 – E banking, under Introduction

Table 1.1.1 E-banking Image 2 – Device, under Introduction

Table 1.2 Wholesale banking Image 3 – Global Connectivity, under

Table 1.3 NRI Services Introduction

Table 2.1 – Customer Service Image 4 – ATM, under Introduction

Table 2.2 – Bank Brand Name Image 5 – Retail Banking,

Table 2.3 – Bank Competitive Ability Image 6 – RBI, under RBI Guidelines

Table 2.4 – Bank Loyalty Image 7 – HDFC LOGO, under Intro to

Table 3.1 – Demographic Company

Table 3.2 – HDFC Services Image 8 – SBI LOGO, under Intro to

Table 3.3 – SBI Customers Company

Table 3.4 – HDFC Product & Services Image 9 – Whole Sale Banking, under

Business Segments
Table 3.5 – HDFC Access Image 10 – Retail Banking. under Business

Table 3.6 – SBI Awareness Segments

Image 11 – Treasury, under Business
Table 3.7 – HDFC Net banking facility Segments
Table 3.8 – Reasons Image 12 – E verify SBI, under SBI

Image 13 – Retail banking SBI, under SBI

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 Chapter 6: BIBLIOGRAPHY

BOOKS

 SBI Training Guide For Internet Banking

 HDFC e-Banking Booklet

WEBSITES

https://www.hdfcbank.com/assets/popuppages/netbanking.html
https://retail.onlinesbi.com/hindi/sbi_home.html
https://www.rbi.org.in/
https://www.wikipedia.org/
https://www.google.co.in/

. . .Thank you!
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