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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

DECLARATION

We hereby declare that the research report on ‘“IMPACT OF SOCIAL ADVERTISEMENTS


ON THE SALES AND BRAND IMAGE OF THE PRODUCT WITH SPECIAL REFERENCE TO IDEA

CELLULAR LIMITED” is authenticate as per my knowledge and work outcome of our

own job.This report in any form has not been submitted to any other institute or
university for any degree or similar award.

Dushyant
Kango
DATE :

PLACE:

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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

ACKNOWLEDGEMENT

This report bears the imprint of many people and without their support it would not have existed. First of
all we would like to express our sincere indebtedness and profound gratitude to our parents whose support
in all manners had made us capable to complete this project.

We acknowledge our deepest thanks to Dr.V.K Jain and Prof.Neha jhanjharia for all their care
and encouraging words and giving suggestion at different point of times. At the outset we would like to put
on record our sincere gratitude to our entire friend.

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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

CERTIFICATE OF SUPERVISOR

This is to certify that the report entitled ‘ A STUDY OF CUSTOMER SATISAFCTION TOWARDS HDFC
BANK AND ITS FINANCIAL PERORMANCE FOR LAST THREE YEARS.’ in Pioneer Institute of
Professional Studies, i.e. being submitted by us in partial fulfillment of the requirement for the minor
research project as a part of curriculum of MBA II semester under the guidance and supervision ,the
result embodied in this dissertation has not been submitted to any other university or institution for the
award of any degree or diploma .

DATE: SUPERVISIOR :Prof. Neha

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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

PLACE: SIGNATURE :

CONTENTS
1) INTRODUCTION:

 CONCEPTUAL FRAMEWORK

 DEFINING VARIABLES

 HISTORY/ BACKGROUND

 LITERATURE REVIEW

 RATIONALE

 OBJECTIVE

2) RESEARCH METHODOLOGY:

 SAMPLE DESIGN

 RESEARCH DESIGN

 TOOLS FOR DATA COLLECTION

 TOOLS FOR DATA ANALYSIS

3) RESULT AND DISCUSSION:

 MAJOR RESULT

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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

 TABLES/CHARTS

 DISCUSSION

4) CONCLUSION:

 CONCLUSION

 IMPLICATION

 SUGGESTIONS

 SCOPE FOR FUTURE WORK

5) REFERENCE:

 BIBLIOGRAPHY

 REFERENCES

 WEBLIOGRAPHY

6) ANNEXURES:

 QUESTIONNAIRE

 RESULT OF FACTOR ANALYSIS

 TABULATION OF DATA

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CONCEPTUAL FRAMEWORK:

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

The authorized capital of HDFC Bank is Rs.450 crore (Rs.4.5 billion). The paid-up capital is Rs.311.9 crore (Rs.3.1 billion). The
HDFC Group holds 22.1% of the bank's equity and about 19.4% of the equity is held by the ADS Depository (in respect of the
bank's American Depository Shares (ADS) Issue). Roughly 31.3% of the equity is held by Foreign Institutional Investors (FIIs) and
the bank has about 190,000 shareholders. The shares are listed on the The Stock Exchange, Mumbai and the National Stock
Exchange. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB".

.Market Mapping:
Market mapping is used to develop a clear understanding of how a market actually works, looking at both the routes or
channels to market and the role of influencers. A key stage in market mapping is to identify who makes the decision between
alternative offers, as it is on these individuals/departments that the segmentation review will focus.

Market Research:
Market research involves the systematic gathering, recording and analyzing of data about customers, competitors and the
market. This links marketers to consumers by supplying essential information to solve marketing challenges and help with marketing
decisions.

The global trend towards consolidation in the financial sector has focused the attention of policymakers on its potential economic
consequences. This can be daunting, because the range of issues is expansive and the economic literature is by no means conclusive.
To appropriately address consolidation, policy-makers need to consider how it could affect their overall objective for the financial
system, which is to maximize social welfare. Although the financial system comprises financial institutions, financial markets, and
infrastructure arrangements such as the clearing and settlement systems, this paper focuses on financial institutions, specifically banks.

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A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

To understand how the banking system can contribute to social welfare, consider the function of banks. They provide financial
services necessary for enterprises and consumers to undertake their business: among other things, they provide a means to hold and
exchange financial assets, they intermediate savings to productive investment through the supply of credit to businesses and
consumers, and they enable risk-sharing. Efficient functioning of these activities contributes to economic growth. Indeed, the
fundamental importance to growth of a well-functioning financial system generally, and of a banking sector specifically, has been
established for some time in the empirical literature on growth.

1. CUSTOMER RELATIONSHIP MANAGEMENT:


Today, many businesses such as banks, insurance companies, and other service providers realize the importance of Customer
Relationship Management (CRM) and its potential to help them acquire new customers, retain existing ones and maximize their
lifetime value. At this point, close relationship with customers will require a strong coordination between IT and marketing
departments to provide a long-term retention of selected customers. This paper deals with the role of Customer Relationship
Management in banking sector and the need for Customer Relationship Management to increase customer value by using some
analitycal methods in CRM applications.
1.1 CRM Objectives in Banking Sector

The idea of CRM is that it helps businesses use technology and human resources gain insight into the behavior of customers and the
value of those customers. If it works as hoped, a business can: provide better customer service, make call centers more efficient, cross
sell products more effectively, help sales staff close deals faster, simplify marketing and sales processes, discover new customers, and
increase customer revenues. It doesn't happen by simply buying software and installing it. For CRM to be truly effective, an
organization must first decide what kind of customer information it is looking for and it must decide what it intends to do with that
information. For example, many financial institutions keep track of customers' life stages in order to market appropriate banking
products like mortgages or IRAs to them at the right time to fit their needs. Next, the organization must look into all of the different
ways information about customers comes into a business, where and how this data is stored and how it is currently used. One
company, for instance, may interact with customers in a myriad of different ways including mail campaigns, Web sites, brick-and-
mortar stores, call centers, mobile sales force staff and marketing and advertising efforts. Solid CRM systems link up each of these
points. This collected data flows between operational systems (like sales and inventory systems) and analytical systems that can help
sort through these records for patterns. Company analysts can then comb through the data to obtain a holistic view of each customer
and pinpoint areas where better services are needed. In CRM projects, following data should be collected to run process engine:

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1) Responses to campaigns
2) Shipping and fulfillment dates
3)Sales and purchase data
4) Account information
5) Web registration data
6) Service and support records
7) Demographic data
8) Web sales data.

2. CUSTOMER SATISFACTION IN BANKING SECTOR


Banking operations are becoming increasingly customer dictated. The demand for 'banking supermalls' offering one-stop integrated
financial services is well on the rise. The ability of banks to offer clients access to several markets for different classes of financial
instruments has become a valuable competitive edge. Convergence in the industry to cater to the changing demographic expectations
is now more than evident. Bancassurance and other forms of cross selling and strategic alliances will soon alter the business dynamics
of banks and fuel the process of consolidation for increased scope of business and revenue. The thrust on farm sector, health sector
and services offers several investment linkages. In short, the domestic economy is an increasing pie which offers extensive economies
of scale that only large banks will be in a position to tap. With the phenomenal increase in the country's population and the increased
demand for banking services; speed, service quality and customer satisfaction are going to be key differentiators for each bank's future
success. Thus it is imperative for banks to get useful feedback on their actual response time and customer service quality aspects of
retail banking, which in turn will help them take positive steps to maintain a competitive edge

2.1 The Need to Measure Customer Satisfaction:

Satisfied customers are central to optimal performance and financial returns. In many places in the world, business organizations have
been elevating the role of the customer to that of a key stakeholder over the past twenty years. Customers are viewed as a group whose
satisfaction with the enterprise must be incorporated in strategic planning efforts. Forward-looking companies are finding value in

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directly measuring and tracking customer satisfaction (CS) as an important strategic success indicator. Evidence is mounting that
placing a high priority on CS is critical to improved organizational performance in a global marketplace.

With better understanding of customers' perceptions, companies can determine the actions required to meet the customers' needs.
They can identify their own strengths and weaknesses, where they stand in comparison to their competitors, chart out path future
progress and improvement. Customer satisfaction measurement helps to promote an increased focus on customer outcomes and
stimulate improvements in the work practices and processes used within the company.

HISTORY OF HDFC BANK

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FOUNDERS

MR.HASMUKHBHAI PAREKH

If ever there was a man with a mission it was Hasmukhbhai Parekh, our Founder and Chairman-Emeritus, who left this earthly
abode on November 18, 994.

Born in a traditional banking family in Surat, Gujarat, Mr. Parekh started his financial career at Harkisandass Lukhmidass - a leading
stock broking firm. The firm closed down in the late seventies, but, long before that, he went on to become a towering figure on the
Indian financial scene.
In 1956 he began his lifelong financial affair with the economic world, as General Manager of the newly-formed Industrial Credit and
Investment Corporation of India (ICICI). He rose to become Chairman and continued so till his retirement in 1972.
At the ripe age of 60, Hasmukhbhai started his second dynamic life, even more illustrious than his first. His vision for mortgage
finance for housing, gave birth to the Housing Development Finance Corporation - it was a trend-setter for housing finance in the
whole Asian continent.
He was a true development banker. His building up HDFC without any government assistance, is itself a brilliant chapter in financial
history. His wisdom and warmth drew people from all walks of life to him, for advice, guidance and inspiration.
A soft spoken man of few words, Mr. Parekh nevertheless held strong and definite views with a quiet conviction. He was always
concerned with building bridges, improving and encouraging communication between people.
He was also a writer in his own right. There are over 200 published articles by him, full of incisive comments on finance and
economics. In 1953 he brought out a volume called: The Bombay Money Market. It detailed the intricate working of the Indian money
market. His works in Gujarati - Hirane Patro, Hirane Vadhu Patro - occupy pride of place in Gujarati literature. In 1992, the
Government of India honoured him with the Padma Bhushan Award. The London School of Economics & Political Science conferred
on him an Honorary Fellowship.

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But there was much more to the man than his financial genius. In his own unassuming way, Hasmukhbhai devoted all his life to
raising resources for philanthropic causes. He was one of the Founder Members of the Centre for Advancement of Philanthropy, and
its Chairman till 1993. He took active interest in the Bombay Community Public Trust, designed specifically to serve the needs of the
city's underprivileged citizens.
When Mr. Deepak Parekh took over as Chairman from Hasmukhbhai, he said: "Taking over from H.T. Parekh is a formidable task;
his vision. brought about not only an institution, but an entire concept which has proved itself to be of lasting importance."
In his last years, developments in the financial sector brought him some measure of satisfaction. Says ICICI Chairman, N. Vaghul:
"The most gratifying aspect about his life is that values he cherished all his life, came into reality in the last years. opening up the
financial sector, and deregulation of lending rates were issues he stood for all his life, and this happened before he passed away."
Farewell dear Hasmukhbhai! All of us will miss not only H.T. Parekh the financial wizard, but much more so, the man. The only and
best tribute we can pay to such an individual is to try and follow in his footsteps, keeping in mind his high ideals and philanthropic
outlook.

MR. DEEPAK PAREKH

Deepak Parekh is the Chairman of HDFC, the country’s leading housing finance company. A pioneer
in mortgage finance, he has enabled scores of Indian middle class people owning their houses or
apartments through affordable loans.
A chartered accountant, Deepak Parekh began his career with Ernst & Ernst Management Consultancy
Services in New York. After returning to India, he worked with Grindlays Bank and also Chase
Manhattan Bank as its assistant representative for South Asia. Deepak Parekh joined HDFC in 1978. He
was promoted as its Managing Director in 1985 and appointed its Chairman in 1993. He is instrumental in making the HDFC a
premier housing finance institution in the country. Deepak Parekh is also the Non-Executive Chairman of Infrastructure Development
Finance Company Ltd (IDFC), a Government of India enterprise for infrastructure projects in 1997. He is also the Non-Executive

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Chairman of Glaxo India Ltd & Burroughs Wellcome (India) Ltd and on the Board of Castrol BP India; Hindustan Lever; Siemens
Ltd, Mahindra & Mahindra and Indian Hotels Company. He is also a non-executive, independent Director of SingTel.
Deepak Parekh has been a member of various Committees set up by the Government of India. He was appointed Chairman of the
high level expert committee, formed to recommend measures for strengthening the Unit Scheme – 1964. The Reserve Bank of India
appointed him Chairman of the Advisory Group for Securities Market Regulation, which was tasked to compare the level of
adherence to international standards in India with that in other countries. He was also Chairman of the Expert Committee constituted
by the Ministry of Power to look into the reform efforts in the power sector.

Deepak Parekh has won several awards including Businessman of the Year 1996 by Business India and the JRD Tata Corporate
Leadership Award by All India Management Association (AIMA). He was the first recipient of the Qimpro Platinum Award for
Quality for his contributions to the services sector and the youngest recipient of the prestigious Corporate Award for Life Time
Achievement by the Economic Times. He was also conferred Padma Bhushan by the Government of India.

HISTORY
HDFC BANK LTD 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.

HDFC BANK LTD was amongst the first to set up a bank in the private sector. The bank was incorporated on 30th August 1994 in
the name of ‘HDFC Bank Limited’, with its registered office in Mumbai. It commenced operations as a Scheduled Commercial Bank
on 16th January 1995. The bank has grown consistently and is now amongst the leading players in the industry .

HDFC is India's premier housing finance company and enjoys an impeccable track record in India as well as in international markets.
Since its inception in 1977, the Corporation has maintained a consistent and healthy growth in its operations to remain the market
leader in mortgages. Its outstanding loan portfolio covers well over a million dwelling units.

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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 In a milestone
transaction in the Indian banking industry, Times Bank was merged with HDFC Bank Ltd., effective February 26, 2000.

MISSION
I. World Class Indian Bank
II. Benchmarking against international standards.
III. To build sound customer franchises across distinct businesses
IV. Best practices in terms of product offerings, technology, service levels, risk management and audit & compliance

VISION STATEMENT OF HDFC BANK

The HDFC Bank is committed to maintain the highest level of ethical standards, professional integrity and regulatory compliance.
HDFC Bank’s business philosophy is based on four core values such as:-

1. Operational excellence.
2. Customer Focus.
3. Product leadership.
4. People.

The objective of the HDFC Bank is to provide its target market customers a full range of financial products and banking services,
giving the customer a one-step window for all his/her requirements. The HDFC Bank plus and the investment advisory services
programs have been designed keeping in mind needs of customers who seeks distinct financial solutions, information and advice on
various investment avenues.

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BUSINESS STRATEGY

I. Increasing market share in India’s expanding banking


II. Delivering high quality customer service
III. Maintaining current high standards for asset quality through disciplined credit risk management
IV. Develop innovative products and services that attract targeted customers and address inefficiencies in the Indian financial
sector.

BOARD OF DIRECTORS
PERSON DESIGNATION

Mr. Jagdish Capoor Chairman

Mr. Aditya Puri Managing Director

Mr. Paresh Sukthankar Executive Director

Mr. Harish Engineer Executive Director

Mr. Keki M. Mistry Director

Mr. Ashim Samanta Director

Mr. Arvind Pande Director

Mrs. Renu Karnad Director

Mr. C M Vasudev Director

Mr. Gautam Divan Director

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Dr. Pandit Palande Director

Awards and Achievements - Banking Services

YEAR 2010

YEAR-2009

EUROMONEY AWARDS
'BEST BANK IN INDIA'
2009
Economic Times Brand
Equity & Nielsen Research Most Trusted Brand - Runner Up
annual survey 2009
Asia Money 2009 Awards 'Best Domestic Bank in India'
IBA Banking Technology
'Best IT Governance Award - Runner up'
Awards 2009
Global Finance Award 'Best Trade Finance Bank in India for 2009
IDRBT Banking Technology
'Best IT Governance and Value Delivery'
Excellence Award 2008

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Asian Banker Excellence in


'Asian Banker Best Retail Bank in India Award 2009 '
Retail Financial Services

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INTEGRATED FINANCIAL SERVICES
A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

SECURITISATION

HDFC CHUBB GENERAL


INSURANCE CO. LTD.

Future Activities

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DISTRIBUTION
A STUDY OF CUSTOMER SATISFACTION TOWARDS HDFC BANK AND ITS FINANCIAL PERFORMANCE FOR LAST THREE YEARS.

BUSINESS SEGMENT

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:

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 agri-based businesses. For these customers, the Bank provides a wide range of commercial and transactional banking
services, including working capital finance, trade services, transactional services, cash management, etc. The bank is also a leading
provider of structured solutions, which combine cash management services with vendor and distributor finance for facilitating
superior supply chain management for its corporate customers. Based on its superior product delivery / service levels and strong
customer orientation, the Bank has made significant inroads into the banking consortia of a number of leading Indian corporate
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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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.
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
Master card 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.

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, corporate need more sophisticated risk management
information, advice and product structures. These and fine pricing on various treasury products are provided through the bank's
Treasury team. To comply with statutory reserve requirements, the bank is required to hold 25% of its deposits in government
securities. The Treasury business is responsible for managing the returns and market risk on this investment portfolio.

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LITERATURE REVIEW
Not so long ago, accessing our own money was about setting aside a couple of hours, getting to the bank before
closing time, standing in one queue to get a token and then in another to collect the cash. Those were the pre-
economic reforms days, when the banking sector primarily consisted of public sector banks.

Cut to the present day and the nature of banking has changed beyond recognition. With ATM cards, simple banking
transactions like withdrawing and depositing money are easier than ever before. For the tech-savvy, there is the
option of banking online. The next medium may just be your mobile.

Even when it comes to products, the changes have been many. Graduating from simple savings accounts and fixed
and recurring deposits, banks now offer a host of products like special savings account and sweep-in-account, no
frills accounts and easy receive account. Private sector banks may have taken the lead, but public sector banks,
with their vast client base and unparalleled treasury of trust, are evolving their own brand of customer-friendliness.

Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative
measurement, although a large quantity of research in this area has recently been developed. Work done by Berry
(Bart Allen) and Brodeur between 1990 and 1998 defined ten 'Quality Values' which influence satisfaction behavior,
further expanded by Berry in 2002 and known as the ten domains of satisfaction. These ten domains of satisfaction
include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front
line Service Behaviors, Commitment to the Customer and Innovation. These factors are emphasized for continuous
improvement and organizational change measurement and are most often utilized to develop the architecture for
satisfaction measurement as an integrated model. Work done by Parasuraman, Zeithaml and Berry (Leonard L)
between 1985 and 1988 provides the basis for the measurement of customer satisfaction with a service by using
the gap between the customer's expectation of performance and their perceived experience of performance. This
provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Work done by Cronin
and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman,
Zeithaml and Berry as two different measures (perception and expectation of performance) into a single
measurement of performance according to expectation. According to Garbrand, customer satisfaction equals
perception of performance divided by expectation of performance.

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The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. The
customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being
measured.

The working of the customer's mind is a mystery which is difficult to solve and understanding the nuances of what customer
satisfaction is, a challenging task. This exercise in the context of the banking industry will give us an insight into the parameters of
customer satisfaction and their measurement. This vital information will help us to build satisfaction amongst the customers and
customer loyalty in the long run which is an integral part of any business. The customer's requirements must be translated and
quantified into measurable targets. This provides an easy way to monitor improvements, and deciding upon the attributes that need to
be concentrated on in order to improve customer satisfaction. We can recognize where we need to make changes to create
improvements and determine if these changes, after implemented, have led to increased customer satisfaction. "If you cannot
measure it, you cannot improve it." - Lord William Thomson Kelvin (1824-1907).

MEASURING CUSTOMER SATISFACTION IN THE BANKING INDUSTRY

Introduction:

Banking operations are becoming increasingly customer dictated. The demand for 'banking supermalls' offering one-stop integrated
financial services is well on the rise. The ability of banks to offer clients access to several markets for different classes of financial
instruments has become a valuable competitive edge. Convergence in the industry to cater to the changing demographic expectations
is now more than evident. Bancassurance and other forms of cross selling and strategic alliances will soon alter the business dynamics
of banks and fuel the process of consolidation for increased scope of business and revenue. The thrust on farm sector, health sector
and services offers several investment linkages. In short, the domestic economy is an increasing pie which offers extensive economies
of scale that only large banks will be in a position to tap. With the phenomenal increase in the country's population and the
increased demand for banking services; speed, service quality and customer satisfaction are going to be key differentiators for
each bank's future success. Thus it is imperative for banks to get useful feedback on their actual response time and customer service
quality aspects of retail banking, which in turn will help them take positive steps to maintain a competitive edge.

The working of the customer's mind is a mystery which is difficult to solve and understanding the nuances of what customer
satisfaction is, a challenging task. This exercise in the context of the banking industry will give us an insight into the parameters of
customer satisfaction and their measurement. This vital information will help us to build satisfaction amongst the customers and
customer loyalty in the long run which is an integral part of any business. The customer's requirements must be translated and
quantified into measurable targets. This provides an easy way to monitor improvements, and deciding upon the attributes that need to

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be concentrated on in order to improve customer satisfaction. We can recognize where we need to make changes to create
improvements and determine if these changes, after implemented, have led to increased customer satisfaction. "If you cannot
measure it, you cannot improve it." - Lord William Thomson Kelvin (1824-1907).

The Need to Measure Customer Satisfaction:

Satisfied customers are central to optimal performance and financial returns. In many places in the world, business organizations have
been elevating the role of the customer to that of a key stakeholder over the past twenty years. Customers are viewed as a group whose
satisfaction with the enterprise must be incorporated in strategic planning efforts. Forward-looking companies are finding value in
directly measuring and tracking customer satisfaction (CS) as an important strategic success indicator. Evidence is mounting that
placing a high priority on CS is critical to improved organizational performance in a global marketplace.

With better understanding of customers' perceptions, companies can determine the actions required to meet the customers' needs.
They can identify their own strengths and weaknesses, where they stand in comparison to their competitors, chart out path future
progress and improvement. Customer satisfaction measurement helps to promote an increased focus on customer outcomes and
stimulate improvements in the work practices and processes used within the company.

When buyers are powerful, the health and strength of the company's relationship with its customers – its most critical economic asset
– is its best predictor of the future. Assets on the balance sheet – basically assets of production – are good predictors only when buyers
are weak. So it is no wonder that the relationship between those assets and future income is becoming more and more tenuous. As
buyers become empowered, sellers have no choice but to adapt. Focusing on competition has its place, but with buyer power on the
rise, it is more important to pay attention to the customer.

Customer satisfaction is quite a complex issue and there is a lot of debate and confusion about what exactly is required and how to go
about it. This article is an attempt to review the necessary requirements, and discuss the steps that need to be taken in order to measure
and track customer satisfaction.

What constitutes Satisfaction?

The meaning of satisfaction: "Satisfied" has a range of meanings to individuals, but it generally seems to be a positive assessment
of the service.

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The word "satisfied" itself had a number of different meanings for respondents, which can be split into the broad themes of
contentment/happiness, relief, achieving aims, achieving aims and happy with outcome and the fact that they did not
encounter any hassle:

Happy

- Content
- Happy, pretty happy, quite happy
- Pleased
- Walked out of there feeling good
- Walk out of there chuffed
- Grateful the service has been OK

Relieved

- Thank God for that


- Phew
- At ease
- Can relax
- Stress reduction
- Secure
- Safe
- Go to the bank with a troubled mind and they sort it out for you
- Sleep at night without worrying what's going to go on
- Everything is sorted out in your mind and you're happy
- Secure, you know the money has been sorted out
- Knowing the money's going to be there

Clearly then there is some variation in understanding of the term. Some of the interpretations fit with the definitions used in much of
the service quality and satisfaction literature, where satisfaction is viewed as a zero state, merely an assessment that the service is
adequate, as opposed to "delight" which reflects a service that exceeds expectations. However, most respondents have more positive
interpretations of the term. These questions allow us to identify priorities for improvement by comparing satisfaction with stated

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(overt) importance, comparing satisfaction with modeled (covert) importance (from identifying key drivers of overall satisfaction), as
well as respondents' own stated priorities.

Service Quality and Customer Satisfaction:

There is a great deal of discussion and disagreement in the literature about the distinction between service quality and satisfaction. The
service quality school view satisfaction as an antecedent of service quality - satisfaction with a number of individual transactions
"decay" into an overall attitude towards service quality. The satisfaction school holds the opposite view that assessments of service
quality lead to an overall attitude towards the service that they call satisfaction. There is obviously a strong link between customer
satisfaction and customer retention. Customer's perception of Service and Quality of product will determine the success of the product
or service in the market.

If experience of the service greatly exceeds the expectations clients had of the service then satisfaction will be high, and vice versa.. In
the service quality literature, perceptions of service delivery are measured separately from customer expectations, and the gap between
the two provides a measure of service quality.

Expectations and Customer Satisfaction:

Expectations have a central role in influencing satisfaction with services, and these in turn are determined by a very wide range of
factors lower expectations will result in higher satisfaction ratings for any given level of service quality. This would seem sensible; for
example, poor previous experience with the service or other similar services is likely to result in it being easier to pleasantly surprise
customers. However, there are clearly circumstances where negative preconceptions of a service provider will lead to lower
expectations, but will also make it harder to achieve high satisfaction ratings - and where positive preconceptions and high
expectations make positive ratings more likely. The expectations theory in much of the literature therefore seems to be an over-
simplification.

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The objective of this project is to describe the business strategies implemented by HDFC, the leading housing finance company in
India from inception and to analyze the same using strategic management techniques. The source of information is Internet and
cases from Harvard on HDFC.

• H.T. Parekh conceived the idea for HDFC (Housing Development Finance Corporation) when he was a student at the
London School of Economics in the 1930’s. The inspiration for such an idea came from Britain’s building societies and he
envisioned something similar for India. However it took almost 50 years to pursue his dream and founded HDFC in 1977.
Prior this he worked for ICICI (Industrial Credit and Investment Corporation of India) and retired as the Chairman of the
company.

• Nevertheless Parekh persisted. HDFC was founded in October 1977 with initial share capital of Rupee (Rs.) 10 crore.
Equity contributions came from the International Finance Corporation, a member of the World Bank Group, in
Washington, D.C. (5%), His Royal Highness the Aga Khan (5%) and a public offering on the Mumbai Stock Exchange.
H.T. Parekh himself refrained from taking any equity.

• Reasons barring customers from using internet banking

The advent of information technology has influenced the banking industry to a great extent. It has made the banks able to perform
their tasks more effectively. It has also enabled them to offer some of their services through self-service technologies (SSTs). One of
the newest channels through which these SSTs have been offered is Internet which is broadly known as Internet banking. When
compared to other payment channels, Internet has seen to offer many advantages both for banks and for customers. However, only a
small portion of Iranian bank customers are Internet banking users. The purpose of this study is to find out why Iranian bank
customers, in particular, those bank customers to whom Internet banking services have already been offered are not using Internet
banking. Further more, when non-adopters comprise the majority of the population, describing all non-adopters as one homogeneous
group may not be accurate. Hence, the second objective of this study is to find the homogeneous groups (segments) of Internet
banking non-adopters.For this purpose, Association Pattern Techniques (APT) was applied which is a two-stage method and has its
foundations in the mean-end theory. In the first stage, 32 Iranian bank customers were interviewed in-depth using laddering
interviewing technique. Based on these interviews, literature review, and the approach of APT, a questionnaire was developed. This
questionnaire was distributed among the customers of EN Bank in 12 branches of the province of Tehran. Totally 507 questionnaires
were collected. The analysis results of the collected data indicate that the main reasons which bar these customers from using Internet
banking are lack of knowledge about Internet banking, lack of trust in the system, and limited Internet banking services. Further
analysis revealed that different customers indeed had different reasons for not using Internet banking. The cluster analysis revealed

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five segments of Internet banking non-adopters, namely, Skeptics, Traditional clients, The Distrustful, The Time-conscientious, and
The Cost-sensitive. The description of each segment and respective suggestions for each segment are provided.

Electronic Retail Payment Systems: User Acceptability & Payment Problems

Abstract: ELECTRONIC RETAIL PAYMENT SYSTEMS: USER ACCEPTABILITY AND PAYMENT PROBLEMS IN GHANA
The payment system in Ghana has undergone considerable change as electronic payment has gained increasingly popularity,
especially in the cities. In Ghana, most bills are paid by walk-in customers. Because of limited transportation, many customers prefer
paying by other means that may not include traveling. Customers are now looking for a way that they can easily make payments
without going to each biller’s location, purchase money orders, and no loss of time. This thesis looks into issues in payment problems
and user acceptance. Payment for goods and services in Ghana is characterized by long queues, long distance traveling and time
wasting that negatively affect business activities and ultimately economic development. Settling utility bills, payment for goods and
services, and money transfers has been a major headache for individuals and firms in Ghana resulting in declined business activities
and huge debt to most of the utility services providers. Indeed, most Ghanaians are yet to fully realize the benefits of the technological
advances made in banking services like networking of business branches, electronic transfers and use of automated teller machines.
The few payment mechanisms that are available are not being well patronized by bank’s customers. The purpose of the study is to
assess the issue of user acceptance in the existing electronic retail payments and also to ascertain the impact in solving some of the
problems in retail payment for goods and services in Ghana. The research also describes and briefly analyses recent and potential
future trends in electronic payments in Ghana, and the challenges faced by participants in this business. It is also in response to the
growing need in Ghana to develop non-cash payment products and clearing systems in order to reduce the over- dependence on cash
payments. In analyzing the electronic payments, we restricted ourselves to business to consumer (B2C) segment. The research
questions for our study are: Can electronic payment system replace existing payment systems and solve payment problems? How are
customer attitudes about electronic payments changing? What are the impediments to market development and innovation in
electronic payments? This study used primary sources in a form of "consumer survey" questionnaire in obtaining the perceptions of
bank customers (mostly individual customers) and interviews of bank’s staffs. An extensive review of the available literature provided
the foundations for the writing of the thesis. The study collected data from secondary sources such as the Internet, articles, databases,
and books, and were analyzed and interpreted. In the rare situations when official statistics are available, the recentness of the data
determined its usefulness. It is universally agreed that a safe and efficient national payment system is essential for sound banking. The
benefits derived from electronic payment cannot be over emphasized. Numerous studies have shown that electronic payment brings
many benefits to users – convenience, security, record-keeping, low cost, and etc. Our study shows that electronic payment systems
have the potential to eliminate if not reduce the problems consumer face in the payment and settlement system. The study also
revealed that consumers are ready to embrace the new payment systems – electronic payment, provided other well anticipated side
benefits are promoted to them.

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Competition in Banking

The author reviews the theoretical and empirical literature to examine the traditional perception that the following trade-off exists
between economic efficiency and stability in the banking system: a competitive banking system is more efficient and therefore
important to growth, but market power is necessary for stability in the banking system. That this trade-off exists is not clear. Market
power can have positive implications for efficiency, and the potentially negative implications of competition on stability may be
manageable through prudential regulation. Neither extreme (perfect competition nor monopoly) is likely ideal. Rather, it may be
optimal to facilitate an environment that promotes competitive behaviour (contestability), thereby minimizing the potential costs of
market power while realizing benefits from any residual that remains. It can be very difficult to assess the contestability of a banking
market. Recent work suggests that the number of banks and the degree of concentration are not, in themselves, sufficient indicators of
contestability. Other factors play a strong role, including regulatory policies that promote competition, a well-developed financial
system, the effects of branch networks, and the effect and uptake of technological advancements.

A Note on Banking FDI in Emerging Markets:


Literature Review and Evidence from M&A Data

Summary
The literature summarised above suggests that banks’ choice of FDI location may be
affected by considerations regarding regulatory environment, the degree with which the
host country is economically integrated with the home country, the information costs
present involved in operating in the host country, and the profit opportunities available in
the host country. The desire for developed country banks to engage in FDI abroad (and in
EMEs) has been driven by institutional considerations (diversification and efficiency
gains) and conditions in the home market (consolidation and market saturation).
The general picture that emerges is that the conditions for foreign expansion of developed
banks into EMEs were very good in the 1990s. As argued by Mathieson and Roldòs
(2001) and Lardy (2001) banking crises and the need for foreign capital brought down
entry restrictions in most EMEs. As these banking systems were weak, they also
represented high economic growth opportunities for foreign banks as described by
Focarelli and Pozzolo (2001). Invariably, the liberalisation of foreign entry, and in many
cases the crisis itself, was preceded by a liberalisation of the regulatory environment.
Given that economic integration had been gaining momentum in previous years and that
many EMEs held common socio-cultural backgrounds with developed countries, the

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opportunity was clearly available for banks seeking to expand abroad. All that was
needed was the will, which was strengthened in the 1990s by the changes to the financial
landscape described in the preceding section.
4 The notion that domestic market saturation leads to expansion abroad is consistent with
the findings of several studies that those banks that tend to expand abroad are large banks
(see Tschoegl (1983), Grosse and Goldberg (1991), Ursacki and Vertinsky (1992),
Williams (1996, 1998), and Focarreli and Pozzolo (2000))

Short Messaging Services (SMS) and Banking


Submitted to: Otago Business PhD Colloquium, October 18 – 19, 2006
Geoffrey Harvey Tanakinjal (Early Stage)
(Department of Marketing)

As a direct marketing tool, electronic Short Message Services (SMS) is likely to


surpass internet-based advertising before the end of 2006. Younger consumers higher
in social class are the most willing to accept SMS direct advertising text and respond
favourably to SMS-TV integrated marketing communications (Trappey III &
Woodside, 2005). On the same note, online banking is starting to gain its momentum
via the internet. Nonetheless, effort has been made to ensure online banking flexibility
walks hand in hand with the convenience factor, therefore introducing banking via
mobile phone (with GPRS interface). Understanding how companies should interact
with their customers and deliver services in electronic environments is of decisive
importance (Parasuraman and Zinkhan 2002). Nevertheless, despite these advantages,
the consumer uses mobile devices mainly for simple services, such as voice services
and text messaging. Based on this factor, it is important to understand the driving
forces of consumers’ intentions to use mobile services and to adapt the services to
fulfil consumers’ motives for using them (Nysveen, Pedersen, & Thorbjornsen. 2005).

Not so long ago, accessing our own money was about setting aside a couple of hours, getting to the bank before closing time, standing
in one queue to get a token and then in another to collect the cash. Those were the pre-economic reforms days, when the banking
sector primarily consisted.

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Cut to the present day and the nature of banking has changed beyond recognition. With ATM cards, simple banking transactions like
withdrawing and depositing money are easier than ever before. For the tech-savvy, there is the option of banking online. The next
medium may just be yourmobile.

Even when it comes to products, the changes have been many. Graduating from simple savings accounts and fixed and recurring
deposits, banks now offer a host of products like special savings account and sweep-in-account, no frills accounts and easy receive
account. Private sector banks may have taken the lead, but public sector banks, with their vast client base and unparalleled .
Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative measurement, although a large
quantity of research in this area has recently been developed. Work done by Berry (Bart Allen) and Brodeur between 1990 and 1998
defined ten 'Quality Values' which influence satisfaction behavior, further expanded by Berry in 2002 and known as the ten domains
of satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Inter-
departmental Teamwork, Front line Service Behaviors, Commitment to the Customer and Innovation. These factors are emphasized
for continuous improvement and organizational change measurement and are most often utilized to develop the architecture for
satisfaction measurement as an integrated model. Work done by Parasuraman, Zeithaml and Berry (Leonard L) between 1985 and
1988 provides the basis for the measurement of customer satisfaction with a service by using the gap between the customer's
expectation of performance and their perceived experience of performance. This provides the measurer with a satisfaction "gap"
which is objective and quantitative in nature. Work done by Cronin and Taylor propose the "confirmation/disconfirmation" theory of
combining the "gap" described by Parasuraman, Zeithaml and Berry as two different measures (perception and expectation of
performance) into a single measurement of performance according to expectation. According to Garbrand, customer satisfaction
equals perception of performance divided by expectation of performance.

The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. The
customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being
measured.

The working of the customer's mind is a mystery which is difficult to solve and understanding the nuances of what customer
satisfaction is, a challenging task. This exercise in the context of the banking industry will give us an insight into the parameters of
customer satisfaction and their measurement. This vital information will help us to build satisfaction amongst the customers and
customer loyalty in the long run which is an integral part of any business. The customer's requirements must be translated and
quantified into measurable targets. This provides an easy way to monitor improvements, and deciding upon the attributes that need to
be concentrated on in order to improve customer satisfaction. We can recognize where we need to make changes to create
improvements and determine if these changes, after implemented, have led to increased customer satisfaction. "If you cannot
measure it, you cannot improve it." - Lord William Thomson Kelvin (1824-1907).

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MEASURING CUSTOMER SATISFACTION IN THE BANKING INDUSTRY

Introduction:

Banking operations are becoming increasingly customer dictated. The demand for 'banking supermalls' offering one-stop integrated
financial services is well on the rise. The ability of banks to offer clients access to several markets for different classes of financial
instruments has become a valuable competitive edge. Convergence in the industry to cater to the changing demographic expectations
is now more than evident. Bancassurance and other forms of cross selling and strategic alliances will soon alter the business dynamics
of banks and fuel the process of consolidation for increased scope of business and revenue. The thrust on farm sector, health sector
and services offers several investment linkages. In short, the domestic economy is an increasing pie which offers extensive economies
of scale that only large banks will be in a position to tap. With the phenomenal increase in the country's population and the
increased demand for banking services; speed, service quality and customer satisfaction are going to be key differentiators for
each bank's future success. Thus it is imperative for banks to get useful feedback on their actual response time and customer service
quality aspects of retail banking, which in turn will help them take positive steps to maintain a competitive edge.

The working of the customer's mind is a mystery which is difficult to solve and understanding the nuances of what customer
satisfaction is, a challenging task. This exercise in the context of the banking industry will give us an insight into the parameters of
customer satisfaction and their measurement. This vital information will help us to build satisfaction amongst the customers and
customer loyalty in the long run which is an integral part of any business. The customer's requirements must be translated and
quantified into measurable targets. This provides an easy way to monitor improvements, and deciding upon the attributes that need to
be concentrated on in order to improve customer satisfaction. We can recognize where we need to make changes to create
improvements and determine if these changes, after implemented, have led to increased customer satisfaction. "If you cannot
measure it, you cannot improve it." - Lord William Thomson Kelvin (1824-1907).

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RATIONALE OF THE STUDY


Over the last few years, the Banking Industryin India has been going through a period of intense change. Needs of the retail as
well as corporate customers are changing and their expectations in terms of service and quality are getting more demanding.
Public sector banks is facing increasingly stiff competition from private players like ICICI AND HDFC. Over the recent past,
PUBLIC SECTOR performance has come under considerable pressure. It has not been able to grow in line with the market and
has been steadily losing market share. . FOR LAST THREE years HDFC BANK is being awarded the best bank of India. So
what are the services are being provided by the bank and what are the changes have been made by the HDFC bank in banking
industry.

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Objectives of study
1. To measure and compare the financial performance of last three years
2. To measure the customer satisfaction towards HDFC BANK.
3. To know the various products offered by the HDFC BANK to the customers.

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RESEARCH METHODOLOGY

A research design is the detailed blueprint used to guide a research study towards its objectives. It is series of advanced decisions
taken together comprising a master plan or a model for the conduct of research in consonance with the research objectives. It details
the procedures necessary for obtaining the information needed to structure or solve the marketing research problem

RESEARCH PLAN:
Preliminary Investigation:
In which data on the situation surrounding the problems shall be gathered to arrive at
· The correct definition of the problem.
· An understanding of its environment.
Exploratory Study:
To determine the approximate area where the problem lies.

RESEARCH DESIGN:
It is a plan of action to be carried out in connection with the research project. It is the guideline for the researcher to enable him to
keep track of his action and to know whether he was moving in the right direction or not. Research was initiated by examining the
secondary data to gain insight into the problem. By analyzing the secondary data, the study aim is to explore the short comings of the
present system and primary data will help to validate the analysis of secondary data besides on unrevealing the areas which calls for
improvement.

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DEVELOPING THE RESEARCH PLAN:


The data for this research project will be collected through self Administration. I will framestructured questionnaire as it is less time
consuming, generates specific and to the point information, easier to tabulate and interpret. Moreover respondents prefer to give direct
answers.
In questionnaires open ended and closed ended, both the types of questions has been used.
COLLECTION OF DATA:
Secondary Data:
It will be collected from internal sources. The secondary data will be collected on the basis of organizational
file, official records, news papers, magazines, management books preserved information in the company’s database and website of the
company.
Primary data:
I wil visit alll the people from different profession personally and will interview them. They will be the main
source of Primary data. The method of collection of primary data will be direct personal interview through a structured questionnaire.
SAMPLING PLAN:
Since it is not possible to study whole universe, it becomes necessary to take sample from the universe to know about its
characteristics.
Sampling Units:
Different professionals Chartered Accountants, Tax Consultants, Lawyers, Business Man, Professionals and House
Wives .
Sample Technique: Random Sampling.

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Research Instrument: Structured Questionnaire.


Contact Method: Personal Interview.

SAMPLE SIZE:
My sample size for this project was 100 respondents. Since it will not be possible to cover the whole universe in the short time
period, it is necessary for me to take a sample size of 100 respondents.
DATA COLLECTION INSTRUMENT DEVELOPMENT:

The mode of collection of data will be based on Survey Method and Field Activity. Primary data collection will base on personal
interview. I will prepare the questionnaire according to the necessity of the data to be collected.
The purpose of the methodology section is to describe the research procedure. This includes the overall research design, data
collection, data interpretation and research report preparation

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EXPECTED OUTCOMES:-
1. Different products offered by the bank to the retail as well as corporate customers..
2. Customer satisafaction towards HDFC bank and services.

3. Financial Performance of HDFC bank.

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RESULTS AND DISCUSSION:-


OBJECTIVE I:-

MEANING OF RATIOS:

A relationship between various accounting figures, which are connected with each other, expressed in mathematical terms, is called
accounting ratios.
According to Kennedy and Macmillan, "The relationship of one item to another expressed in simple mathematical form is known as
ratio."
Robert Anthony defines a ratio as – "simply one number expressed in terms of another."
Accounting ratios are very useful as they briefly summarise the result of detailed and complicated computations. Absolute figures are
useful but they do not convey much meaning. In terms of accounting ratios, comparison of these related figures makes them
meaningful. It is difficult to say which business concern is more efficient unless figures of capital investment or sales are also
available.
Analysis and interpretation of various accounting ratio gives a better understanding of the financial condition and performance of a
business concern.

IMPORTANCE OF RATIO ANALYSIS: Ratio analysis does two things, immediately. The first thing is it allows the company to
compare itself with other like companies. If management feels things aren't going well, they can help pinpoint the problem through
comparing their ratios with other companies. They may have several ratios that are comparable, but a couple which are way off. That
might be where the problem is.

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Also, ratio analysis may help by comparing your company with prior periods. If a particular ratio is declining when it would be better
if it were staying the same or increasing, then again looking at the ratios are important to find out where the problem lies. Ratios are
important to spot trends easily.

The report contains the ratio analysis of :


1) Earning Per Share
2) Dividend Yield Ratio
3)Profitability Ratios
4) Liquidity Ratios
5) Leverage Ratios
6) Coverage Ratios
7) Asset Quality Ratios
8) Credit to Deposits Ratio
9) Component Ratios

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1) Earning Per Share: Basic earnings per equity share is computed by dividing net income by the weighted average number of equity
shares outstanding for the year.

Years 07-08 08-09 09-10


EPS 22.92 27.92 36.29

Source: Annual report of HDFC Bank

INTERPRETATION-The EPS of Rs10/- nominal value share has shown a consistent and healthy growth over the years and as
compared to 07-08 it has become about 102%. This shows strong foundation of the bank to achieve this growth rate by increasing the
net income from Rs 665.6(lacs) to Rs.1590.2(lacs) and shares from 29,03,83,946 to34,40,20,927.This helped the bank to meet the
financial needs mostly from its retained earnings and avoided the need to avail capital at a cost from the market. So the bank was in
position to utilize funds efficiently to improve the financial position of bank.

Quarterly comparison of EPS:

Quarters Mar-10 Jun-10 Sep-10


EPS 13.29 10.94 12.42

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

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There is volatility in the quarterly EPS. Gross profit reduced from Rs.1088.70(lacs) in Mar-10 to Rs.1027.51(lacs) in Jun-08 . This
shows the bank also suffered from the global crisis that has badly hit the economies of the world and also during these periods the
banks had increased the Fixed Deposit rates from 9.5% to 10.5% p.a.
Also the noteworthy thing is that the employee expenses in Mar-10 were Rs.345.6(lacs) and Rs.611.63(lacs) in Sep-08

2) Dividend yield:- The owners of the bank are rewarded in form of dividend which is attributed from the profits. This keeps the
owners motivated as they believe that their hard earned money offered to bank is being efficiently utilized and they are getting returns
on their investments

Year 06-07 07-08 08-09 09-10


Dividend(%) 45 55 70 85

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

INTERPRETATION-Growth in dividend was due to the expansion in business activities. Not only the interest income has increased
but a substantial increase in other income is also seen. The income other than interest grew from Rs,112398(lacs) in 07-08 to Rs
228315(lacs) in 08-09. This is attributed by the changing lifestyles of people which now don’t view bank as a source to avail loans or
deposit money but as an entity that takes care of many of their financial transactions and they are also availing the value-added
services of banks like auto payment of bills on standing instructions, forex services, advisory services, etc.

3) Profitability ratio-The objective of profitability relates to a company’s ability to earn a satisfactory profit so that the investors and
shareholders will continue to provide capital to it. A company’s profitability is linked to its liquidity because earnings ultimately
produce cash flow. For these reasons ratios are important to both investors and shareholders.

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> Operating Margin- Operating margin is a measurement of what proportion of a company's revenue is left over after paying for
operating expenses . A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on
debt.

Year 07-08 08-09 09-10


Operating Margin 29.56 33.15 30.78

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

INTERPRETATION-In 07-08 the operating margin ratio was 29.56% as the company had incurred Rs.169109(lacs) on operating
expenses for infrastructure and staffing in relation to the expansion in the branch network and growth in the retail loan and credit card
businesses. In the next year it has shown improvement when the bank spent Rs.242080(lacs) on the operating expenses as its
operating income increased from Rs.173357 to Rs.256391(lacs). And the ratio diminished again in 09-10 as the operating expenses
were Rs.374562(lacs) and operating profit was Rs 376541(lacs) which is a result of increase in operating expenses from 49.38% in
07-08 to 49.87% of the net revenues.

> Net Profit Margin -Net profit divided by net revenues is called Net profit margin

Years 07-08 08-09 09-10


Net Profit Margin 15.55 13.57 12.82

Source: Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

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INTERPRETATION -In 07-08 the NPM is 15.55% as the bank had efficiently converted its revenues into actual profits and showed
an effective cost control. However in the subsequent year it reached 13.57 as the net profit as a percentage of net revenues came down
from 25.43% to 22.90%. And further in 09-10 the NPM has diminished and net profit to net revenues came down to 21.17%. Lower
net profit margins have lead to a reduction in the returns to the investors. But this reduction is not an outcome of inefficiency but the
bank has to spend more on operating expenses to counter the competition from other banks and the margins of profit have squeezed.

> Reported Return On Net Worth: This ratio indicates how profitable a company is by comparing its net income to its average
shareholders' equity. The ratio measures how much the shareholders earned from their investment in the company. The higher the
ratio percentage, the more efficient management is in utilizing its equity base and the better return is to investors.

Year 07-08 08-09 09-10


Return on net worth 16.43 17.74 13.83

Source: Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

INTERPRETATION In the year 07-08 RONW is 16.43% and shareholders have been benefitted from their stake in the company in
the form of fair returns. In that year the share capital was Rs. 31314(lacs) whereas the net income was Rs. 342466(lacs). In the next
year the ratio improved as there was only Rs. 625(lacs) increase in share capital when the net income increased by Rs.156005(lacs).
But again in 09-10 there is a substantial reduction in the ratio with the infusion of Rs. 3504(lacs) of share capital and the net income
increased by Rs 252632(lacs).

Increase in net income (%) (yoy)

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Rs (lacs)
Year 08-09 09-10

Net income 45.55 50.68


Source: Annual Report of HDFC Bank

Increase in share capital (%) (yoy)

Rs (lacs)
Year 08-09 09-10

Share Capital 2 10.97


Source: Annual Report of HDFC Bank

4) Liquidity Ratio- It is used to determine a company's ability to pay off its short-terms debts and obligations. Generally, the higher
the value of the ratio, the larger the margin of safety that the company possesses to cover short-term debts.

> Quick Ratio(Acid Test Ratio)-It is an indicator of a company's short-term liquidity. It measures a company's ability to meet its
short-term obligations with its most liquid assets. The higher the quick ratio, the better the position of the company. The quick ratio is
more conservative than the current ratio. When short-term obligations need to be paid off immediately, there are situations in which
the current ratio would overestimate a company's short-term financial strength

Year 07-08 08-09 09-10

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Quick ratio 5.18 4.07 4.89

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

INTERPRETATION -The quick ratio has been 5.18 in the year 07-08 which indicates the bank’s robustness and financial soundness
in paying off its short term obligations. It has reduced in the next year but in the year 09 it has increased.
Rs (lacs)
Year 07-08 08-09 09-10

Quick assets 1477834 904665 691900


Current liabilities 483196 538195 290599
Source: Annual Report of HDFC Bank

The figures indicate that there is excess liquidity in the bank except in 08-09.But the banks are under the guidance of RBI and they
have to follow the liquidity norms laid down by RBI.

> Current Ratio- The ratio is mainly used to give an idea of the company's ability to pay back its short-term liabilities with its short-
term assets. The higher the current ratio, the more capable the company is of paying its obligations. A ratio under 1 suggests that the
company would be unable to pay off its obligations if they came due at that point

Year 07-08 08-09 09-10


Current ratio 0.29 0.26 0.26

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Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055.

INTERPRETATION -The ratio shows a decline due to the credit expansion, increasing demand deposits and other liabilities.
Rs (lacs)
Year 07-08 08-09 09-10

Demand deposits 1618579 1958482 2875970


Other liabilities 784949 1368913 1643191
Source: Annual Report of HDFC Bank

5) Leverage Ratio- A company's leverage relates to how much debt it has on its balance sheet, and it is another measure of financial
health. Generally, the more debt a company has, the riskier its stock is, since debt holders have first claim to a company's assets. This
is important because, in extreme cases, if a company becomes bankrupt, there may be nothing left over for its stockholders after the
company has satisfied its debt holders.

> Total debt/equity - It indicates what proportion of equity and debt the company is using to finance its assets. A high debt/equity
ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a
result of the additional interest expense.

Year 07-08 08-09 09-10


Total debt/equity 10.53 10.62 8.76

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

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INTERPRETATION -There is growth of the bank and it is able to manage its funds from the internal sources. The equity capital has
increased its share in the liabilities in balance sheet over 90% in comparison to the outside debts. This helps the bank to maintain high
credit reputation in market.
Rs(lacs)
Total liabilities 6820686 8480246 12167937

Shareholders equity 529953 643315 1149723


Source: Annual Report of HDFC Bank

6) Coverage Ratio- A coverage ratio encompasses many different types of financial ratios. Typically, these kinds of ratios involve a
comparison of assets and liabilities. The better the assets "cover" the liabilities, the better off the company is.

> Interest Coverage Ratio- This ratio is used to determine how easily a company can pay interest on outstanding debt. The interest
coverage ratio is calculated by dividing a bank's earnings before interest and taxes (EBIT) of one period by the bank's interest
expenses of the same period.
The lower the ratio, the more the company is burdened by debt expense. When a company's interest coverage ratio is 1.5 or lower, its
ability to meet interest expenses may be questionable. An interest coverage ratio below 1 indicates the company is not generating
sufficient revenues to satisfy interest expenses.

Year 07-08 08-09 09-10


Interest coverage ratio 1.87 1.9 1.79

Source: Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

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Also ,
Rs (lacs)
Year 07-08 08-09 09-10

Interest expenses: 192950 317945 488712


EBIT : 434581 652541 1011752
Source: Annual Report of HDFC Bank

INTERPRETATION -The ratio for the year 07 is 1.87 which is reasonable and not below 1.5.This indicates that the bank is in a sound
financial health and is able to pay the interest on its outstanding debts. The ratio was best in 08-09 among the three financial years.
But has reduced in the year to09 1.79. Still the bank has maintained a healthy ratio over the years.

7) Asset Quality Ratio: The most important ratio for the stakeholders of bank is the Non-Performing Assets ratio which is covered
under the asset quality ratio. This ratio shows the true picture of the qualitative value of assets rather than the quantitative value of
assets

Year 08-09 09-10


Net NPA to Net Advances(%): 0.43 0.47

Source: Annual Report of HDFC Bank

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INTERPRETATION -The ratio shows a decline. But comparing the components of the ratio the 0.04% decline has occurred when in
the background the increase in loans given shows a 35% increase which means the bank has adhered to strict policies in allocation of
funds and it has not been aggressive in allocating loans.
Rs (lacs)
Year 08-09 09-10

Net NPA 20289 29852


Net Advances 4699478 6342690
Source: Annual Report of HDFC Bank

8) Credit to Deposit Ratio (CD Ratio): The ratio is indicative of the percentage of funds lent by the bank out of the total amount
raised through deposits. Higher ratio reflects ability of the bank to make optimal use of the available resources. The point to note here
is that loans given by bank would also include its investments in debentures, bonds and commercial papers of the companies.

Year 08-09 09-10


CD 68.7 62.9

Source: Annual Report of HDFC Bank


Also,
Rs (lacs)
Year 08-09 09-10

Advances 4694478 6342690


Deposits 6829794 10076860

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Source: Annual Report of HDFC Bank

INTERPRETATION -This ratio forms an integral part of analysis as it indicates the amount of reliability the bank has earned in the
minds of its customers and evidence of its robustness .The ratio for 08-07 is 68.7. It has decreased in the subsequent year as a result
of global economic depression that has panicked the customers from making any new investments and so lesser credit is being asked
for.

9) Component Ratio: This ratio shows the components and their composition in the business of the bank. One such ratio is Long term
assets to total assets. The high ratio indicates more investment in fixed assets that bank has purchased to continue its operations
smoothly.

Year 07-08 08-09 09-10


Long term assets/total assets 0.92 0.89 0.91

Source:Http://money.rediff.com/money/jsp/ratio.jsp?companyCode=14030055

Also,
Rs (lacs)
Year 07-08 08-09 09-10

Long term assets 85508 96667 117513


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Total assets 7350639 9123561 13317660


Source: Annual Report of HDFC Bank

INTERPRETATION -In the year 08-09 there was a decline in the ratio which shows that the bank had more of investments and
current assets. And as the company had expansion plans in the other two years the ratios are higher.

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OBJECTIVE II:-

Various products and Services offered by HDFC BANk

PERSONalBANKING

ACCOUNT & DEPOSITS SERVICE

Banking should be effortless. With HDFC Bank, the efforts are rewarding. No matter what a customer's need
and occupational status, we have a range of solutions that are second to none. Whether you're employed in a
company and need a simple Savings account or run your own business and require a robust banking partner,
HDFC Bank not only has the perfect solution for you, but also can recommend products that can augment
your planning for the future.
It includes these services: -

• Saving accounts.
• Current accounts.
• Fix deposits.
• Demat account.
• Safe deposits lockers.

Savings Accounts
These accounts are primarily meant to inculcate a sense of saving for the future, accumulating funds
over a period of time. Whatever person’s occupation, bank have confident that person will find the

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perfect banking solution. There some saving accounts like: -


Regular Saving Account:
An easy-to-operate savings account that allows you to issue cheques, draw Demand Drafts and withdraw
cash. Check up on your balances from the comfort of your home or office through Net Banking, Phone
Banking and Mobile Banking. If you need money urgently then you can take money from the ATM machine.
There are 1977 ATM centers across the country.
Saving plus Account
Introducing the best banking option for you with HDFC Bank Savings plus Account. Now you can get
access to some of the finest banking facilities with HDFC Bank's Savings plus Account. All you have to do is
maintain an Average Quarterly Balance of Rs. 10,000/-.
Saving Max Account
Welcome to a world of convenience. Presenting Savings Max account, loaded with maximum benefits to
make your banking experience a pleasure. By maintaining an average quarterly balance of just Rs. 25,000/-
you get a host of premium services from HDFC Bank absolutely free.
Senior Citizen Account
HDFC Bank appreciates your needs and endeavors, which is why, they present an account especially
dedicated to customer, which like a dutiful child will help you fulfill your needs in the best manner possible.
No frills Account
In an effort to make banking simpler and more accessible for customers, bank has introduced the 'No Frills'
Savings Account, which offers customer all the basic banking facilities. Customer can even avail of services
like Net Banking, Mobile banking free of cost. In this customer can put Zero Initial Pay-in and a Zero
Balance account
Institutional saving accounts
A specially designed account that offers twin benefits of a savings as well as a current account. Customer’s
funds continue to earn you interest while he enjoys hassle-free banking & a host of other features. All this

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and more in a Zero Balance account.


Salary Accounts
In this account customer can get salary from where he/she doing such job and organization or company at
where the customer of the bank in doing job deposit their salary in to the salary account a person can get
salary.
There are various kinds of saving accounts in the HDFC Bank like: -

• Pay roll account.


• Classic salary account.
• Regular salary account.
• Premium salary account.
• Defense salary account.
• No frills salary account.
• Reimbursement salary account.
Kid’s advantage account
Start saving for your child today and secure his/her future a sentence tells by the Hdfc bank. Open a Savings
Account and transfer money every month into customer’s Kids Advantage Account and watch the savings
grow as customer’s child grows. The accumulated savings in the Kids Advantage Account can over the years
help in meeting customer child's needs.

Main features and benefits of this account are as follow:-


For their Growing Needs

• Free Education Insurance cover of Rs. 1, 00,000/- in the event of death of the parent / guardian
through vehicular accident by road, rail or air to safeguard the future of your child.
• ATM/International Debit Card will be issued for children between 7-18 years of age in the child's

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name with your permission. The amount your child is able to withdraw is Rs. 2,500/- at ATMs or
spend Rs. 2,500/- at merchant locations.
• Free cash withdrawals on any other Bank's ATM*
•1 free Personalised cheque book for your child.
• Monitor the transactions of your child's account with the free quarterly physical statement of account
or free monthly Email Statement of account
• Free Net Banking for you to monitor your child's account.
• Free SMS/Email alerts informing you about the account transactions.
For their Secured Future

• Standing Instruction to transfer any amount from your account to your Kid's Advantage Account
every month (Minimum value = Rs. 1,000/- & Minimum tenure = 1 year) (Mandatory).
• Once the balance in the Kid's Advantage Account reaches/exceeds Rs. 35,000/-, the amount in excess
of Rs. 25,000/- will automatically be transferred into a Fixed Deposit for 1 year 1 day, in your child's
name, by signing in for our sweep-out facility.
• You can also opt for systematic investments in mutual funds from the Kid's Advantage Account in
your child's name.

Current accounts
HDFC Bank Current Account gives the power of inter-city banking with a single account and access to more
than cities. From special cheques that get treated at par with local ones in any city where branch, faster
collection of outstation cheques (payable at branch locations), free account to account funds transfer between
HDFC Bank accounts to Free inter-city clearing of up to 100 lakhs per month, bank’s priority services have
become the benchmark for banking efficiency.
Now, with an HDFC Bank Current Account, experience the freedom of multi-city banking. Person can have
the power of multi-location access to his account from any of our 761 branches in 327 cities. Not only that,
he can do most of his banking transactions from the comfort of his office or home without stepping out.
There are various kinds of current account in this bank like: -
Plus current account

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HDFC Bank plus Current Account gives the power of inter-city banking with a single account and access to
more than cities. Plus Current Account requires maintaining an average quarterly balance of Rs. 100,000.

Trade current account

In today's changing business requirements, you need to transfer funds across cities, and time is of the essence.
HDFC Bank Trade Current Account gives power of inter-city banking with a single account.
From special cheques that get treated at par with local ones in any city where bank have a branch, to free
account to account funds transfer between HDFC Bank accounts, to free inter-city clearing of up to 50 lacs
per month, bank’s priority services have become the benchmark for banking efficiency. Trade Current
Account requires maintaining an average quarterly balance of Rs. 40,000.

Premium current account


Business needs a partner who can manage finances while concentrate on growing business. Form this
account customer can avail benefits of inter-city banking account that requires an average quarterly balance
of only Rs. 25,000, offers Payable-At-Par cheque book facility & FREE inter-city clearing transactions across
our network up to Rs.25 Lacs per month
A Current Account with the benefits of accessing account from a large network of branches, and through
direct access channels - the phone, mobile, Internet and through the ATM.

Regular current account


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A Current account is ideal for carrying out day-to-day business transactions. With the HDFC Bank Regular
Current Account, customer can access account anytime, anywhere, pay using payable at par cheques or
deposit cheque at any HDFC bank branch. It also facilitates FREE NEFT transactions & FREE RTGS
collections for faster collections in account. Regular Current Account requires to maintain an average
quarterly balance of only Rs. 10,000.
With a vast network of branches in cities all over the country, and access to a multitude of ATM's, customer
can keep track of all transactions anytime.
Reimbursement Current Account
No more paperwork, no more receipts to keep track of - a hassle-free account that allows deposit the
reimbursements receive from company/organization on a monthly basis.
To open this account a person has to follow these processes:
Procure an Account Opening Document (AOD) from HDFC Bank. (If person has just joined, first request to
company to open up a Salary Account for particular person). Mention Salary Account number and Debit
Card number on the AOD so that Debit card can be linked to both, Salary Account as well as new
Reimbursement Account. Request company to directly credit cash payments to the Reimbursement Account.

RFC – Domestic Account


Full name of this account is Resident foreign currency account.
Have you accumulated foreign currency from traveling abroad frequently? Received gifts from relatives in
foreign currency? Or earned it by any other means as approved by the Reserve Bank of India?
If so, open Resident Foreign Currency Domestic Account and manage foreign currency efficiently. Person
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can choose to set up your account either in US Dollar, Great Britain Pound or Euro.
To open this accounts a person as to follow this process: -
Choose the currency in which person wish to operate. Open account with an initial amount as per the
following-US Dollar = 250 Great Britain Pound = 200 Euro = 250 and maintain an Average Quarterly
Balance of the same amount.
Flexi current account
Tired of static transaction limits during peak seasons? HDFC Bank Flexi Current Account is the answer to
changing banking needs during peak seasons.
With HDFC Bank Flexi Current Account Cash Deposit and Anywhere Transaction limits are a multiple of
the balance you maintain in Current Account. So, during peak seasons, customer get the benefit of higher
transaction limits due to the higher average balances maintained in account. What’s more, during lean
seasons, person need not worry about maintaining huge balances to enjoy high transaction limits, which
person anyway may not need. Flexi Current Account requires to maintain a minimum Average Monthly
Balance (AMB) of just Rs. 75,000.
Apex current account
The top position is always the desirable position. With the Apex current account, take business to a new
high. On maintaining an average quarterly balance of Rs. 10 lacs, this account makes sure person make the
most of every business opportunities coming his way. Unlimited, free, anywhere Banking experience at the
APEX is reserved for person who joints this.
Max current account
Maximum benefits and minimum hassles for customer with Max Current Account with a Rs. 5 lacs average
quarterly balance requirement, bank present to world of privileges that helps business expand and grow.
Features like maximum free transaction limits including other beneficial features on this current account truly
enhances business potential to the Maximum.
Fix Deposits
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Long-term investments form the chunk of everybody's future plans. An alternative to simply applying for
loans, fixed deposits allow to borrow from own funds for a limited period, thus fulfilling needs as well as
keeping savings secure.
People can invest his/her money into either in security market or gold or mutual fund or into a fix deposits.
People always go to that way where he/she can get more benefits and minimum risks. So, for this purpose he
has a better chance to deposits money in to the fix deposit.
If people believe in long-term investments and wish to earn higher interests on his/her savings, now is the
time to invest money in HDFC bank Fixed Deposit. Get up to 9.75% on HDFC Bank Fixed Deposit with an
additional 0.50% for Senior Citizens. What's more NO PENALTY if withdraw part of the FD in times of
need. Flexibility, Security and High Returns all bundled into one offering.
Regular fix deposit
As per the rules and regulation of the bank a person can deposit their money in to a fix deposit in the bank
and can get the benefits of these facilities.
Five year tax saving fix deposit
In 2006, it was announced for the first time that Bank fixed deposits booked by an Individual/HUF for 5
years & up to Rs. 1,00,000/- will be allowed exemption under Sec 80C of the Income Tax Act,1961 subject
to necessary declarations taken from the Customer.
Supper saver facility
Customer can enjoy a high rate of interest along with the liquidity of a Savings Account by opting for a
Super Saver Facility on his or her savings account. Avail of an overdraft facility of up to 75% of the value of
his or her Fixed Deposit.

Sweep-in facility
Do you wish to avoid taking overdrafts, and still take advantage of your Fixed Deposits? Then what you need
is a Sweep-In Facility on savings account. Link Fixed Deposit to Savings or Current Account and use it to
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fall back on in case of emergencies. A deficit in Savings or Current Account is taken care of by using up an
exact value from Fixed Deposit. Since deposits are broken down in units of Re 1/-, customer will lose interest
only for the actual amount that has been withdrawn.
Demat Account
Nowadays share market is becoming is the main occupation of the person. So to avoid faulty processes demat
account is really most important for the share market and for the safety of shares it is most important.
HDFC BANK is one of the leading Depository Participant (DP) in the country with over 8 Lac Demat
accounts.
HDFC Bank Demat services offers a secure and convenient way to keep track of securities and investments,
over a period of time, without the hassle of handling physical documents that get mutilated or lost in transit.
HDFC BANK is Depository participant both with -National Securities Depositories Limited (NSDL) and
Central Depository Services Limited (CDSL).

Safe Deposit Lockers


A Safe Deposit Locker with HDFC Bank is the solution to person’s fear. Located at select branches in cities
all over the country, bank’s lockers ensure the safe keeping of valuables.
Eligibility
An individual (not minor), firms, limited company, associations, clubs, trusts, societies, etc may hire a locker.
Advantages of safe deposit locker in HDFC bank

• Wide Availability.
• Lockers available in various sizes. i.e. Small, Medium, Large and Extra Large with varying rents.
• Lockers are rented out for a minimum period of one year. Rent is payable in advance.
• No deposits are required to avail a locker. Just open an account and get the locker facility.
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• There is a nominal annual charge, which depends on the size of the locker and the centre in which the
branch is located.

Nomination for Safe Deposit Locker

• The Lockers and their contents can be nominated to people near and dear to you.
• Nomination facility is available to individual hirer of Safe Deposit Locker.
• In the case of a sole hirer of a safe deposit locker, nomination can be made in favor of only one
individual.
• Where the safe deposit locker is hired in the name of a minor, the nomination shall be made by a
person lawfully entitled to act on behalf of the minor.

Terms & Conditions

• For obtaining a Locker at HDFC Bank you must be an account holder with Bank.
• Lockers can be allotted individually as well as jointly.
• The Locker holder is permitted to add or delete names from the list of persons who can operate the
Locker and can have access to it.
• Loss of Key is to be immediately informed to the concerned Branch.
LOAN
In today’s competitive world every thing happens only with the help of money or through the money every
person need money. But some time a person has not cash on hand at that time he needs lone either from any
friend or from any financial institute. Lone dose not mean that only lower class person needs it but also upper
class person it is needed.As per the requirement of the every person there are much type of loans are there in
the HDFC bank.
Personal loan
A person has so many dreams but some time due to scarcity of money a dream can’t be satisfy. So, here one
solution for that person this is personal loan. From this he/she can fulfill their needs or requirement. It can be
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any thing either a dream of vacation or son/daughter’s admission to college or any wedding, so personal loan
can be helpful in this entire requirement.As person ordered in the hotel for tea or coffee and it is immediately
came fast, same over here any person want to get a personal loan with the nominal documents he can get the
loan.
Home loan
HDFC Bank brings HDFC home loans to doorstep. With over 30 years of experience, a dedicated team of
experts and a complete package to meet all housing finance needs, HDFC Home Loans, help people realize
dream.
Vehicles loan
Nowadays the life is being so fast, time value is becoming more important so to reach at the
destination of any business related occasion or for a boy to reach college or any where at the
fix time there are so many requirement of vehicles. But every people have no capacity to
purchase vehicles with cash so for that here in the HDFC bank vehicles loan is available. There
are many types of vehicles loan.

Types of vehicles loan:

• Two wheeler loans.


• New car loan.
• Used car loan.
• Tractor loan (for agree culture business).
• Commercial vehicle loan.

So, as per the requirement of the person there are these types of loans are available this are at the chip rate
and hassel free from more documentation and other procedure. And commercial businessman can get the
benefits of the commercial vehicles loans. Thus as per the need of different people there are vehicle loans
available. And also terms and condition are different as per the requirement.
Express loan plus
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Bank offer Express Loans Plus at person Doorstep to help fulfill all his/her needs. The procedure is simple,
documentation is minimal and approval is quick. It is helpful to person in repairing of house, School
admission or also in the family holiday.
Gold loan
With HDFC Bank's Gold Loan, person can get an instant loan against gold jewellery and ornaments. The
procedure is simple, documentation is minimal and approval is quick. A person can get 70% loan on the
value of the gold jewellery and ornaments. There is also availability of the overdraft on the gold jewellery.
With this a customer can get free additional services like free personalized cheque book, free international
debit card, and free net banking phone banking services.

Educational loan
Nowadays important of education becoming very high. As it important becoming high it is becoming costly.
So in the higher education some time people can not effort a high price at a same time. So, there is education
loan is also available for the student.
A person can get loan up to 10 lacs to study in India and 20 lacs if he wants to study in abroad. Loan
available up to tenure of 7 years including moratorium period.
Loans disbursed directly to the educational institution. It is released as per fee schedules of institutes.
Exclusive Telegraphic Transfer facility available for courses abroad. Loans available for short duration/ job
oriented courses also.

Loan against security


With HDFC Bank's Loan against Securities, person can get an overdraft against securities like Equity Shares,
Mutual Fund Units(Equity, Debt, FMPs), Gold Exchange Traded Fund(ETF), NABARD's Bhavishya Nirman
Bonds, Policies issued by LIC & Select Private Insurance Companies, NSC, KVP, UTI Bonds (ARS & US64
Bonds) and Gold Deposit Certificates, while still retaining ownership. And the best part is that he can
continue to enjoy all his shareholder benefits such as rights, dividends and bonuses Loan available to NRIs
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against Shares, Mutual Funds (equity, Debt, FMPs), US64 Bonds, Insurance Policies, NSC, and KVP.
Loan against property
HDFC Bank brings Loan Against Property (LAP). Person can now take a loan against residential or
commercial property, to expand his business, plan a dream wedding, and fund his child's education and much
more. He can depend on bank to meet all his business requirements even to purchase a new shop or office for
business. Loan to purchase Commercial Property (LCP) is a specially designed product to help person expand
his business without reducing the capital from his business.

These are loans services providing by HDFC bank which are very hassle free and really benefits for most of
customer and most of customer are satisfied by the loan services providing by the bank.

CARD SERVICES
In today’s competitive and fast time card services providing by the banks are really very important to every
person and every business needs or to take meal in to the hotel or to purchase jewellery from the jewellery
shops cards are playing good role in the banking sectors.

Bank ranges of Cards help to meet financial objectives. So whether persons are looking to add to his buying
power, conducting cashless shopping, or budgeting his expenditure, he will find a card that suits him.
Credit cards
A person wants many things like, a trip to Bali, a diamond ring for wife's dreams. Some dreams can't wait. If
there's something person has always wanted. If a person wanted fulfills his wants he can get benefits from the
HDFC bank’s credit cards facilities.
Different types of credit

• Classic cards
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• Silver Credit Card.


• Value plus Credit Card.
• Health Plus Credit Card.
• Premium Cards:
• Gold Credit Card
• Titanium Credit Card
• Woman's Gold Card
• Platinum Plus Credit Card
• Visa Signature Credit Card
• World MasterCard
• Commercial Cards
• Corporate Credit Card

Debit card
HDFC Bank Debit Cards give person complete and instant access to the money in his accounts without the
risk or hassle of carrying cash.
Types of debit card: -

• Classic card
• Easy shop international Debit card.
• Premium card
• Easy shop gold Debit card.
• Specialized card
• Easy Shop International Business Debit Card.
• Easy Shop Woman's Advantage Debit Card.
• Easy Shop NRO Debit Card.
• Kisan Card.
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Prepaid card
Besides offering convenience, Prepaid Cards have been tailored to answer travel and gifting needs.
• ForexPlus Cards
• Prepaid Travel Card.
• Gift Plus Cards
• Prepaid Gift Card.
• Food Plus Cards
• Prepaid Food Plus card.
• Money Plus Card
• The Corporate Payment card

INVESMENT AND INSURANCE


Nowadays a ward investment is becoming more popular. Person invest their money in to various schemes or
in to the gold or share market etc. but some time he is in to the difficult situation, for that bank help person
invest wisely through financial and investment services.

Types of investment: -
Mutual Funds
Invest through the Mutual Fund route to meet varied investment objectives.
Insurance

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Traditional Plans Unit Linked Plans

HDFC children's PLAN. HDFC Unit Linked Young Star Plus II.

HDFC Money Back Plan. HDFC Unit Linked Young Star Suvidha.

HDFC Unit Linked Young Star Suvidha


HDFC Savings Assurance Plan.
Plus

HDFC Assurance Plan. HDFC Unit Linked Pension.

HDFC Term Assurance Plan. HDFC Unit Linked Pension Plus.

HDFC Loan Cover Term Assurance Plan. HDFC Unit Linked Endowment Plus II.

HDFC Endowment Assurance Plan. HDFC Unit Linked Endowment Suvidha.

HDFC Single Premium Whole of Life


HDFC Unit Linked Endowment Suvidha
Insurance

HDFC Unit Linked Enhanced Life


Protection

GENERAL AND HEALTH INSURANCE


Complete protection for business, health, travel & more.
Bonds
A secure investment avenue giving stable returns with tax benefits.
Financial Planning
Start Now Plan investments to meet financial goals
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Knowledge Centre
Profit from research and make informed investment decisions.
Equities & Derivatives
Leverage bank’s vast information repository and transact online.
Mudra Gold Bar
Buy 24 Karat gold bars made in Switzerland and certified by Assay.
FOREX AND TRADE SERVICE
Nowadays businesses becoming worldwide e.g. India to America but main problems are about
monitory transaction because at every country the currency become changed so for that banks are
playing a very important for the businesses.
If people need to deal in foreign currency and keep tabs on exchange rates every now and then,
transfer monies to India, make payments etc., HDFC Bank has a range of products and services
that people can choose from to transact smoothly, efficiently and in a timely manner.

Bank offering following Foreign Exchange Products and Services.

Foreign Exchange and Trade Services


The following are different methods of transacting in Foreign Exchange and remitting money:
• Travelers Cheques.
• Foreign Currency Cash.
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• Foreign Currency Drafts.


• Cheque Deposits.
• Remittances.
• Cash to Master.
• Trade Services.
• Forex Services Branch Locator.

Important guidelines and schedules.


All Foreign Exchange transactions are conducted by strictly adhering to RBI guidelines. Depending on
the nature of transaction or point of travel, people will need to understand his Foreign Exchange limits.
PAYMENT SERVICE
Nowadays life of a person become very stressful and he/she becoming busy with their own business,
but they have to payment for something so for that reason bank’s payment services become started.
With HDFC Bank's payment services, person can bid goodbye to queues and paper work. Bank’s
range of payment options make it easy for pay for a variety of utilities and services.
Verified By Visa
Do you want to be worry free for your online purchases. Now you can shop securely online with your
existing Visa Debit/Credit card.
Net Safe
Now shop online without revealing your HDFC Bank Credit Card number. What more, you can now
use your HDFC Bank Debit Card also for online purchases.
Merchant Services
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Accept all Visa, MasterCard, credit and Debit cards at your outlets through state of the art POS
Machines or through your website and experience hassle free payment acceptance.

Prepaid Mobile Refill


If you are an HDFC Bank Account holder, you can now recharge your Prepaid Mobile Phone with
thisservice.
Bill Pay
Pay your telephone, electricity and mobile phone bills at your convenience. Through the Internet,
ATMs, your mobile phone and telephone - with Bill Pay, our comprehensive bill payments solution.
Visa Bill Pay
Pay your utility bills from the comfort of your home! Pay using your HDFC Bank Visa credit card
and forget long queue and late payments forever
Pay Now
Use your HDFC Bank Credit Card to pay your utility bills online, make subscriptions and donations;
no registration required. Enjoy credit free period and reward points as per your credit card features.
Insta Pay
Pay your bills, make donations and subscribe to magazines without going through the hassles of any
registration.

Direct Pay
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Shop or Pay bills online without cash or card. Debit your account directly with our Direct Pay service!

Visa Money Transfer


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

e-Monies National Electronic Funds Transfer


Transfer funds from your account to other Bank accounts across India –
FREE of cost.

Online Payment of Excise & Service Tax


Make your Excise and Service Tax payments at your own convenience through HDFC Bank's Net Banking
facility.
Religious Offerings

Now donate to your favorite temple easily and securely using HDFC BANK's Net Banking.

IMPERIA/PREFERRED/CLASSIC BANKING
As a special customer bank providing a TAJ to customer with name imperia/preferred customer. For that
bank provide a special service to their customer. HDFC Bank's preferred/imperia Programme is the royal
decree that enhances the exclusivity that you are accustomed to. It makes you feel special at every step,
pampering with services those others can only dream about. This service goes beyond the obvious, rises
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above the expected, so that the whole world can see, that even today, the grandeur and magnificence of
royalty is alive and well.

Thus as retail banking service bank providing really good and beneficial services to their customer and as
family member they are providing good services to every customer either they are came business related or
anything. So for this reason HDFC bank playing a good role in the customer’s life for their monitory
transaction.
NRI BANKING
With a view to attract the savings and other remittance into India through banking channels from the person
of Indian Nationality / Origin who are residing abroad and bolster the balance of payment position, the
Government of India introduced in 1970 Non-Resident(External) Account Rules which are governed by the
Exchange Control Regulations.

The funds held in Non-Resident (External) Accounts (NRE Accounts) qualify for certain benefits like
exemptions from taxes in India, free repatriations facilities, etc.
Deposit types
NRI-Banking facilitates the NRI customer to open the following account types.
NRE (Non Resident External Accounts)
It can be in the form of Savings, Current or fixed deposits in Indian rupees. The funds in this account are
fully repatriable.
NRO (Non Resident Ordinary Accounts)
It can be in the form of Savings, Current or Fixed Deposits in Indian Rupees. The funds in this account are
not repatriable (only interest accrued is repatriable).
FCNR (Foreign Currency Non Resident Accounts)
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It can be in the form of fixed Deposits only, in the five major currencies, namely US Dollars, GBP, DM,
Euro, and Japanese Yen. The funds in this account are fully repatriable.

WHOLESALE BANKING
Wholesale banking is the provision of services by banks to the like of large corporate clients, mid-sized
companies, real estate developers and investors, international trade finance businesses and institutional
customers, such as pension funds and government entities/agencies. Also included is banking services offered
to other financial institutions. In essence, wholesale banking services usually involve high value transactions.
Wholesale banking compares with retail banking, which is the provision of banking services to individuals.

Corporate service
Corporate Banking reflects HDFC Bank's strengths in providing our corporate clients in India, a wide array
of commercial, transactional and electronic banking products. We achieve this through innovative product
development and a well-integrated approach to relationship management.

• Large Corporate
• Supply Chain Partners
• Agricultural Lending

Small & medium term enterprises


HDFC Bank understands how much of hard work goes into establishing a successful SME. Bank also
understands that business is anything but "small" and as demanding as ever. And as business expands and
enters new territories and markets, person need to keep pace with the growing requests that come in, which
may lead to purchasing new, or updating existing plant and equipment, or employing new staff to cope with
the demand. That's why HDFC Bank has assembled products, services, resources and expert advice to help
ensure that your business excels.
The following links will help identify individual needs.
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• Funded Services.
• Non-Funded Services.
• Specialized Services.
• Value Added Services.
• Internet Banking.

Financial Institutions & Trusts


HDFC Bank provides financial services to:

• Banks.
• Financial Institutions.
• Mutual Funds.
• Stock Brokers.
• Insurance Companies.
• Commodity Businesses.
• Trusts.

Government sector

HDFC Bank acts as an active medium between the government and the customers by means of various
services. These services include:
Tax Collection wherein customers can directly pay their taxes like Direct taxes, Indirect taxes and Sales Tax
collections at their local HDFC Bank.
E-Ticketing - Helps the customer by providing him a direct access to book a Railway Ticket online and get it
home delivered.
Opening of L/C's is done by the bank on behalf of Government of India, Mints and Presses, thus facilitating
imports for the Government.
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Collection of levies and taxes on behalf of Municipal Corporations i.e. Kalyan -Dombivli Municipal
Corporation, is undertaken by the Bank.
Collection of stamp duty is done via franking mode in the state's of Maharashtra & Gujarat.
The Stamp Duty Franking Facility is available at following branches in Maharashtra Fort, Chembur, Lower
Parel, Mira Road, Thane (Talao Pali), Panvel, Ratnagiri, Pune(FC Road), Kolhapur, Nagpur, Pimpri.
The Stamp Duty Franking Facility is available at branches in Gujarat
Disbursement of Pension to retired Employees of Central Govt and Defence is directly done by HDFC Bank
along with the disbursement of pension to the members of EPFO (Employees Provident Fund Organisation).
Electronic Collection of fees on behalf of DGFT is done by the bank too.

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SWOT ANALAYSIS OF HDFC BANK


STRENGTHS
HDFC is the strongest and most venerable play on Indian mortgages over the long term. The
management of the bank is termed to be one of the best in the country.
• HDFC has differentiated itself from its peers with its diversified network and revamped
distribution strategy
• HDFC has been highly proactive in passing on the cost and benefit to customers.
• Besides the core business, HDFC’s insurance, AMC, banking, BPO, and real estate private
equity businesses are also growing at a rapid pace and the estimated value of its
investments/subsidiaries explains ~30% of HDFC’s market capitalization.
• High degree of customer satisfaction.
• Lower response time with efficient and effective service.
• Dedicated workforce aiming at making a long-term career in the field.
• Products have required accreditations.
• Superior customer service vs. competitors
• Large share of low-cost deposits, higher net interest margin

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• Better quality of assets, NPA of 0.4 per cent


• Free float available, FIIs can buy its stock
• Higher profitability

WEAKNESSES

• High dependence on individual loans.


• Major stake held by American financial groups which are under stress due to economic
slowdown.
• Customer service staff needs training.
• Processes and systems, etc need to be better managed
• Management covers insufficient.
• Sectoral growth is constrained by low unemployment levels and competition for staff
• Marginal international presence
• No next line of leadership
• Not very aggressive in M&A space, growing only organically
• Possible takeover target

OPPORTUNITIES

• Fast growing insurance business in the country.

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• Untapped rural markets.


• Could extend to overseas broadly
• Fast-track career development opportunities on an industry-wide basis.
• An applied research centre to create opportunities for developing techniques to provide
added-value services.
• Unique partnership to create job opportunities for IFBI’s PGDBO students
• HDFC bank automates business processes with Staff ware; HDFC Bank anticipates major
cost savings whilst maintaining high levels of customer service thanks to new enterprise
software agreement.
• HDFC Bank plans to set up a non-banking finance company (NBFC) to undertake fund-based
activities.
• In recent times, India has witnessed entry of many international banks like CITI Bank,
YES Bank etc which posses an external entrant threat to HDFC Bank – as this Banks are
known for their art of working and maintain high standards of customer service.
• After showing a significant growth overall, India is able to attract many international financial
& banking institutes, which are known for their state of art working and keeping low
operation costs.

THREATS

• Loss of market share to commercial banks and HFC’s


• Higher than expected increase in funding cost
• Risk of fraud and NPA accretion due to increase in interest rates and fall in property prices is
inherent to the mortgage business
• Lack of infrastructure in rural areas could constrain investment.
• High volume/low cost market is intensely competitive.
• Very high competition prevailing in the industry
• Extension overseas holds a lot of risk!
• Threat from credit card collections dept.
• Varying and In-Convenient ECS dates.

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• Unlike Government Banks, an account needs a minimum balance of Rs.10,000

Detailed Analysis
Strength - Opportunity Analysis
Strength:
It is well know that HDFC Bank has the largest Authorised Capital Base in the Banking System in
India i.e. having a total capacity to raise Rs. 19,000,000,000 (Non – Premium Value).

Opportunity:
Seeing the present financial & economic development of Indian Economy and also the
tremendous growth of the Indian Companies including the acquisition spree followed by
them, it clearly states the expanding market for finance requirements and also the growth in
surplus disposal income of Indian citizens has given a huge rise in savings deposits – from the
above point it is clear that there is a huge market expansion possible in banking sector in India.

Strategy:
From the analysis of Strength & Opportunity the simple and straight possible strategy for HDFC Bank
could be - to penetrate into the rural sector of India for expanding its market share as well as leading
all other Pvt. Banks from a great gap.

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Strength - Threat Analysis


Strength:
HDFC Bank is not only known for large capital but also for having a low operations cost though
having huge number of branches and services provided.

Threat:
After showing a significant growth overall, India is able to attract many international financial &
banking institutes, which are known for their state of art working and keeping low operation
costs.

Strategy:
To ensure that HDFC Bank keeps going on with low operation cost & have continuous business it
should simply promote itself well & provide quality service so as to ensure customer loyalty, therefore
guaranteeing continuous business.

Weakness - Opportunity Analysis


Weakness:
It is well known that workforce responsiveness in banking sector is very low in Indian banking sector,
though HDFC Bank has better responsible staff but it still lacks behind its counterparts like HSBC,
CITI BANK, YES BANK etc.

Opportunity:
In the present world, India is preferred one of the best places for out – sourcing of business process
works and many more.

Strategy:
As international companies are reaping huge benefits after out-sourcing there customer care &
BPO’s, this same strategy should be implemented by HDFC Bank so as to have proper customer

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service without hindering customer expectations.

Weakness - Threat Analysis


Weakness:
Though having a international presence, HDFC Bank has not been able to keep up the international
standards in providing customer service as well as banking works.

Threat:
In recent times, India has witnessed entry of many international banks like CITI Bank, YES Bank
etc which posses an external entrant threat to HDFC Bank – as this Banks are known for their art
of working and maintain high standards of customer service.

Strategy:
After having new entrants threat, HDFC Bank should come up with More additional benefits to
its customer or may be even reduce some fees for any additional works of customers.

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BIBLIOGRAPHY/WEBLIOGRAPHY
WEBSITES

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1. www.hdfc bank.com

2. www.wikipedia.com
3. www.scribd.com

4. http://ideas.repec.org/p/bca/bocawp/04-24.html

5. www.oppapers.com/.../literature-review-on-bank-service-market-in-india-page1.html

6. www.oppapers.com/.../literature-review-banking-page1.htm

7. www.essays.se/about/literature+review+of+banking+system/

8. www.bankofcanada.ca/fr/res/wp/2004/wp04-24.pdf

9. www.bis.org/publ/cgfs22gb.pd

10. http://www.bis.org/publ/cgfs22gb.pdf

11. http://eprints.otago.ac.nz/562/1/Geoffrey_Tanakinjal.pdf

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