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Customer Delight at IDBI bank at Bardoli




GLS Institute of Computer technology Opp, Law Garden, Ellis bridge, Ahmadabad 380006, India Phone : 26447636 Fax: 26445958 Website:

This is to certify that Mr. Jigeshkumar.B.Chaudhari Roll No.G1003 students of GLS Institute of Computer technology have successfully completed their Summer Internship Project on Customer delight at IDBI bank at Bardoli in partial fulfilment for the requirements of the MBA programme of Gujarat Technological University. This is their original work and has not been submitted elsewhere.
_________________ Dr. Hitesh Ruparel Director-in Charge ____________________ Prof. Bhargav Modi Assistant Professor & Project Guide
Date: _________________ Place: _________________

I hereby declare that the summer project report titled Customer delight at IDBI bank at bardoli. Based on original piece of work done by me for the fulfilment of the award of degree of Master of Business Administration and whatever information has been taken from any sources had been duly acknowledge. I further declare that the personal data & information received from any respondent during survey has not been shared with any one and is used for academic purpose only.

Date: Place:

Jigesh Chaudhari

In the growing global competition, the productivity of any business concern depends upon the behavioural aspect of consumers. This topic deals with the customers perception towards schedule of services charges offered by IDBI bank at Bardoli. This project report contains five different chapters. The report begins with the research methodology taken up to conduct the survey of customers. The second chapter is the introduction of the Banking industry in India and facts file of bank in India and also about schedules, public and private sector banks. The third chapter includes about IDBI banks profile and its achievements, development and recognition. The fourth chapter includes comprehensive coverage of forecasting concepts and techniques which shows the analysis of data through tabulation, computation and graphical representation of data collected from survey. The fifth chapter deals with the findings, suggestion & conclusion part which is very much important after analysis is made. As we know that only analysis and conclusion is not the end of a research, so in the sixth chapter the recommendation part is covered which are made after a depth study of the analysis part of thesis. In each of the five chapters as described above, every chapter has been scheduled in a manner so as to enable the reader to appreciate the contents easily. The report is supported by figures and data wherever necessary with a view to assist the reader in developing a clear cut understanding of the topic.


The project is intended to give the reader a fair understanding of the various aspects of the banks service schedule and about the basic factors that include and calculated to complete the project report. The report is compiled in easy language to ensure proper reader comprehension. We wish to express our sincere gratitude to Dr. HITESH RUPAREL director sir and PROF.BHARGAV MODI of GLS institute of computer technology for providing us an opportunity to do our project work on CUSTOMER DELIGHT. This project bears on imprint of many peoples. We sincerely thank for guidance and encouragement in carrying out this project work we also wish to express our gratitude to the officials and other staff members of IDBI BANK who rendered their help during the period of our project work. Our special thanks to SIR RAKESH PATEL branch manager of the bank. We are obliged to him for providing us with a clear basis to start the project and for providing valuable feedback during the course of this project without which the study would not have been possible. We are also thankful to all concerned executives and staff members those who are directly or indirectly involved in carrying out our project and have extended their able guidance and cooperation in this project work.

Place: Ahmadabad Date:

Executive summary

Banking Industry which is basically my concern industry around which my project has to be revolved is really a very complex industry. And to work for this was really a complex and hectic task and few times I felt so frustrated that I thought to left the project and go for any new industry and new project. Challenges which I faced while doing this project were following Banking sector was quite similar in offering and products and because of that it was very difficult to discriminate between our product and products of the competitors. Target customers and respondents were too busy persons that to get their time and view for specific questions was very difficult. Sensitivity of the industry was also a very frequent factor which was very important to measure correctly. Area covered for the project while doing job also was very large and it was very difficult to correlate two different customers/respondents views in a one. Every financial customer has his/her own need and according to the requirements of the customer product customization was not possible. So above challenges some time forced me to leave the project but any how I did my project in all circumstances. Basically in this project I analyzed thatWhat factors are really responsible for customers delight of IDBI Banks performance and schedule of services compare to other public and private sector bank in this competitive era?

Table of contents

NO. 1 2 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 2.10 3 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 Research Methodology Introduction to the Industry From world wars independence Post independence Nationalisation of banks Liberalization of banks Banks in India Facts file of banks in India Public sector banks Private sector banks Indian banking industry Introduction of company History Vision Quality of products and services IDBI bank business chart Corporate opportunity IDBI bank organizational chart Board of directors Recruitments Management and organisation Corporate social responsibility Corporate governance Milestones Investor Shareholders Financial reporting and records Health, safety and environment National interest Preamble Competition Equal rights

NO. 1 6 8 9 9 10 11 13 14 16 18 19 20 21 21 22 22 23 24 24 25 25 25 25 28 29 29 29 29 29 30 30

3.22 3.23 3.24 3.25 3.26 3.27 March) 3.28 3.29 3.30 3.31 3.32 4 4.1 4.2 5 6 7 8 9

Prohibited business Public representation of the company and the group Ethical standards Securities Transactions and Confidential Information Protection of Bank's assets

30 31 31 31 32

Significant developments during FY 2010-11 (April 32 Competitors of IDBI bank Top ten private bank of India Pest analysis SWOT analysis of IDBI bank Five forces model Data Interpretation and Analysis Secondary data analysis Primary data analysis Testing of Hypothesis Findings Recommendations Conclusion Bibliography Annexure 65 68 108 111 113 114 115 116 35 42 45 56 58

List of tables
Sr. NO. 1 2 3 4 5 TABLE TITLE 2.2 2.6 2.7 4.3 From world war to independence Banks in India Facts file of banks in India Literacy rate in India PAGE NO. 8 11 13 53

Comparison of various banks schedule of service with 101 101 105

IDBI bank 4.3.1 Savings Account 4.3.2 Current Account

List of figures
Sr. NO. 1 2 FIGURE TITLE 2.10 3.4 3.5 3.6 3.28 3.30 3 4.2.1 4.2.2 4.2.3 4.2.4 4.2.5 4.2.6 Indian banking industry IDBI bank business chart IDBI organizational chart Board of Directors Pest Analysis Literacy rate in India Five forces model Information about A/c Name of bank Types of A/c Criteria Use of A/c Purpose of A/c Ease of transaction Process Clarity Rate of interest Documentation PAGE NO. 18 22 23 24 45 54 59 68 69 70 71 72 73 74 75 76 77 4.2..8.8 4.2.9 4.2.10 charges 4.2.11 4.2.13 4.2.14

Time duration Knowledge of staff Repayment charges and processing charges After sales services Response of employee Dealing in comfortable language Location from house Drinking water Parking Seating Arrangement May I help you Ease of locating Aware about all service charges

78 79 80 81 82 83 84 85 86 87 88 89 90

Customers Satisfaction by banks service 91 Compare with other banks charges Ranking of SBI Ranking of IDBI Ranking of HDFC Ranking of Indusind Ranking of ICICI Ranking of Axis Ranking of Bank of Baroda Charges should be free Overall rating of bank 92 93 94 95 96 97 98 99 100 101

Research Methodology
1.1 Introduction
Today it is fashionable to talk about the new economy. We hear that the business are operating in globalize economy; things are moving at a nanosecond pace our market are characterized by hyper competition and disruptive technologies are challenging every business and so business must adopt to empower consumer. To become successful in such a competitive environment the business organizations have to be customer oriented. Customers need and want must be taken care of. Build customer and not only products. Customer must be delighted. This information about the market could be collected by the way of proper market survey. Rom the market survey we get the feed about the good or services of the organization .For this purpose the said project work is undertaken. The project was carried out for knowing study preferences of customers towards services offered by IDBI bank. The second objective of the project was to study to study comparative analysis of service charges of IDBI bank with other nationalise bank at Bardoli region. The project was carried out in the market of Bardoli of Gujarat state. IDBI Bank Ltd. is a Universal Bank with its operations driven by a cutting edge core Banking IT platform. The Bank offers personalized banking and financial solutions to its clients in the retail and corporate banking arena through its large network of Branches and ATMs, spread across length and breadth of India. IDBI Bank Ltd. is today one of India's largest commercial Banks. For over 40 years, IDBI Bank has essayed a key nation-building role, first as the apex Development Financial Institution (DFI) (July 1, 1964 to September 30, 2004) in the realm of industry and thereafter as a full-service commercial Bank (October 1, 2004 onwards). As a DFI, the erstwhile IDBI stretched its canvas beyond mere project financing to cover an array of services that contributed towards balanced geographical spread of industries, development of identified backward areas, emergence of a new spirit of enterprise and evolution of a deep and vibrant capital market. IDBI bank offered very convenient services to their customer for their better customer satisfaction. The service charges offered by bank are very minimum compare to other bank. This service differentiates IDBI bank from other bank. While doing the project attempt was made to collect maximum information about the marker. To get actual and correct information, it was not told retailers that the survey is conducted by IDBI bank for the obvious reasons.

1.2 Research problem

In this competitive market every bank is trying to come up with faster & convenient customer service. IDBI bank offers very appropriate customer services and many service charges are free to their customer compare to other bank. Apart from it the study shows the analysis of the customers satisfaction towards banks service charges.

1.3 Scope of the Study

It will help us to enhance the knowledge. This study will help in precision or exactness of result. This will also help in doing quality survey and interpretation.
This will also help to find out the reliable techniques for data analysis.

1.4 Research methodology

Research is a process of arriving dependable solution to problems through planned and systematic collection, analysis and interpretation of data. Methodology aims at making the study systematic. The selection of methods for research work depends upon the nature of problem. This is a kind of descriptive research that describes the state of affairs of the firm. In this study, I am going to use primary and secondary data.

1.5 Objectives
Primary Objectives
To study the customer satisfaction at IDBI bank, Bardoli. To study preferences of customers towards services offered by IDBI bank. To know the awareness of customer towards service charges offered by IDBI bank.

Secondary Objectives
To study comparative analysis of service charges of IDBI bank with other nationalise bank at bardoli region.

1.6 Literature review

To evaluate the service quality in banking in the Middle East and Qatar in particular, based on different levels of customers perception regarding service quality. In order to achieving higher levels of quality service in banking, banks should deliver higher levels of service quality and in the present context customers perceptions are highest in the level of infrastructure facilities of the bank, followed by timing of the bank, and return on deposit. Owing to the increasing competition in banking, customer service is an important

part and bank managers should be rethinking how to improve customer satisfaction with respect to service quality. In service industries, globally, the subject of service quality remains a critical one as businesses strive to maintain a comparative advantage in the marketplace. Since financial services, particularly banks compete in the marketplace with generally undifferentiated products, and service quality becomes a primary competitive weapon (Stafford, 1996). It is true that structural changes have resulted in banks being allowed a greater range of activities, enabling them to become more competitive with non-bank financial institutions (Angur et al., 1999). Currently, technological changes are causing banks to rethink their strategies for services offered to both commercial and individual customers. Moreover, banks that excel in quality service can have a distinct marketing edge since improved levels of service quality are related to higher revenues, increased cross-sell ratios and higher customer retention (Bennett and Higgins, 1993), and expanded market share (Bowen and Hedges, 1993). Moreover, the banks understand that customers will be loyal if they can produce greater value than competitors. Research has indicated that service quality has been increasingly recognized as a critical factor in the success of any business (Parasuraman et al., 1988) and the banking sector in this case is not exceptional. Service quality has been widely used to evaluate the performance of banking services (Cowling and Newman, 1995). The banks understand that customers will be loyal if they receive greater value than from competitors (Dawes and Swailes, 1999) and on the other hand, banks can earn high profits if they are able to position themselves better than their competitors within a specific market (Davies et al., 1995). Therefore, banks need focus on service quality as a core competitive strategy (Chaoprasert and Elsey, 2004). Moreover, bank all over the world offer similar kinds of services, and try to quickly match their competitors innovations. It can be noted that customers can perceive differences in the quality of service (Chaoprasert and Elsey, 2004). Moreover, customers evaluate banks performance mainly on the basis of their personal contact and interaction (Gronroos, 1990). Defining service quality and its components in a form that is actionable in the workplace is an important endeavour that any business company cannot take lightly. Moreover, many scholars agree that service quality can be decomposed into two major dimensions (Gronroos, 1984; Lehtinen and Lehtinen, 1982). The first is referred to by Zeithaml et al. (1985) as outcome quality and the second by Gronroos (1984) as technical quality. However, the first dimension is concerned with what the service delivers and on the other hand, the second dimension is concerned with how the service is delivered: the process that the customer went through to get to the outcome of the service.

By: Mohammed Husain and Shirley Leo Department of Accounting and Information Systems, College of Business and Economics, Qatar University, Doha, Qatar

1.7 Research design

The research design used for the study is descriptive in nature.

1.8 Data collection source

Primary data Structured Questionnaire. Secondary data Internet Brochure of bank

1.9 Sample Plan

Population: Sampling unit: Sample size: Sampling method: Time Period: Bardoli a Customer of IDBI bank in Bardoli 100 Convenience and judgmental Sampling 01/06/2011 to 15/07/2011

1.10 Hypothesis
Hypothesis is used to test the validity of the assumption. First of all the assumption is made about the population parameter. Then sample data is collected, sample statistics is produced and based on this information, it is decided how likely it is that the hypothesized population parameter is correct. In short, the difference between the hypothesized value and the actual value of the sample mean is determined and validity of the assumption is tested. Hypothesis 1: H0: Location is an important factor while dealing with IDBI bank. H1: Location is not an important factor while dealing with IDBI bank. Hypothesis 2: H0: Enquiries are not handled properly. H1: Enquiries are handled properly. Hypothesis 3:

H0: Language of Staff members is not Customer friendly. H1: Language of Staff members is not Customer friendly

1.11 Statistical test procedures used for analysis

Descriptive statistics were used for analysis and interpretation, one sample Z test for means was used for hypothesis testing.

1.12 Expected contribution of the study and beneficiaries

We as a student of management would be the most benefited. As this study will help us to gain in depth and live knowledge and insight in to the subject matter.
The IDBI bank which showed interest to help us carry out this project would also be

benefited with the same. The college would also benefit from the project report, as this would help the college to build the reputation within the corporate world.

1.13 Limitations
1. The feedback received from the individuals is according to his perception, limited exposure and personal knowledge level. 2. It is difficult to know whether respondents are true representatives or not. 3. Because of the time constraints, the sample size of the project and the area covered was limited.

1.14 Time Budget

Topic Finalization: June 11, 2011 Research Proposal submission: June 16, 2011 Secondary Data collected submission: June 26, 2011 Primary Data collected submission: July 1, 2011 Data Analysis submission: July 8, 2011 Rough Draft of the project: July 10, 2011

1.15 A short write-up on the researcher

This Project report will be prepared by Jigesh Chaudhari. (G 1003) Jigesh Chaudhari has done BBA from B. V. Patel institute of BMC & IT at Bardoli. And will be opting for Finance in second year of M.B.A.

Industry Profile
2.1 Introduction
Banking in India originated in the last decades of the 18th century. The first banks were The General Bank of India which started in 1786, and the Bank of Hindustan, both of which are now defunct. The oldest bank in existence in India is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal. This was one of the three presidency banks, the other two being the Bank of Bombay and the Bank of Madras, all three of which were established under charters from the British East India Company. For many years the Presidency banks acted as quasi-central

banks, as did their successors. The three banks merged in 1921 to form the Imperial Bank of India, which, upon India's independence, became the State Bank of India.

Indian merchants in Calcutta established the Union Bank in 1839, but it failed in 1848 as a consequence of the economic crisis of 1848-49. The Allahabad Bank, established in 1865 and still functioning today, is the oldest Joint Stock bank in India.(Joint Stock Bank: A company that issues stock and requires shareholders to be held liable for the company's debt) It was not the first though. That honor belongs to the Bank of Upper India, which was established in 1863, and which survived until 1913, when it failed, with some of its assets and liabilities being transferred to the Alliance Bank of Shimla.

When the American Civil War stopped the supply of cotton

to Lancashire from

the Confederate States, promoters opened banks to finance trading in Indian cotton. With large exposure to speculative ventures, most of the banks opened in India during that period failed. The depositors lost money and lost interest in keeping deposits with banks. Subsequently, banking in India remained the exclusive domain of Europeans for next several decades until the beginning of the 20th century.

Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The Comptoired'Escompte de Paris opened a branch in Calcutta in 1860 and another in Bombay in 1862; branches in Madras and Pondicherry, then a French colony, followed. HSBC established itself in Bengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade of the British Empire, and so became a banking center.

The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in 1895, which has survived to the present and is now one of the largest banks in India.

Around the turn of the 20th Century, the Indian economy was passing through a relative period of stability. Around five decades had elapsed since the Indian Mutiny, and the social, industrial and other infrastructure had improved. Indians had established small banks, most of which served particular ethnic and religious communities.

The presidency banks dominated banking in India but there were also some exchange banks and a number of Indian joint stock banks. All these banks operated in different segments of the economy. The exchange banks, mostly owned by Europeans, concentrated on financing foreign trade. Indian joint stock banks were generally under capitalized and lacked the experience and maturity to compete with the presidency and exchange banks. This segmentation let Lord Curzon to observe, "In respect of banking it seems we are behind the times. We are like some old fashioned sailing ship, divided by solid wooden bulkheads into separate and cumbersome compartments."

The period between 1906 and 1911, saw the establishment of banks inspired by the Swadeshi movement. The Swadeshi movement inspired local businessmen and political figures to found banks of and for the Indian community. A number of banks established then have survived to the present such as India, Corporation, Indian Bank, Bank of Baroda, Canara Bank and Central Bank of India. The favor of Swadeshi movement lead to establishing of many private banks in Dakshina Kannada and Udupi district which were unified earlier and known by the name South Canara (South Kanara) district. Four nationalized banks started in this district and also a leading private sector bank. Hence undivided Dakshina Kannada district is known as "Cradle of Indian Banking"

2.2 From world wars to independence

The period during the First World War (1914-1918) through the end of the Second World War (1939-1945), and two years thereafter until the independence of India were challenging for Indian banking. The years of the First World War were turbulent, and it took its toll with banks simply collapsing despite the Indian economy gaining indirect boost due to war-related economic activities. At least 94 banks in India failed between 1913 and 1918 as indicated in the following table: Number of Years banks that failed 12 42 11 13 9 7 Authorised Paid-up capital (Rs. Lakh) 274 710 56 231 76 209 Capital (Rs. Lakh) 35 109 5 4 25 1

1913 1914 1915 1916 1917 1918

2.3 Post independence

The partition of India in 1947 adversely impacted the economies of Punjab and West Bengal, paralyzing banking activities for months. India's independence marked the end of a regime of the Laissez-faire for the Indian banking. The Government of India initiated measures to play an active role in the economic life of the nation, and the Industrial Policy Resolution adopted by the government in 1948 envisaged a mixed economy. This resulted into greater involvement of the state in different segments of the economy including banking and finance. The major steps to regulate banking included: In 1948, the Reserve Bank of India, India's central banking authority, was nationalized, and it became an institution owned by the Government of India. In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of India (RBI) "to regulate, control, and inspect the banks in India." The Banking Regulation Act also provided that no new bank or branch of an existing bank could be opened without a license from the RBI, and no two banks could have common directors.

However, despite these provisions, control and regulations, banks in India except the State Bank of India, continued to be owned and operated by private persons. This changed with the nationalisation of major banks in India on 19 July 1969.

2.4 Nationalisation of banks

The RBI was nationalized on January 1, 1949 in terms of the Reserve Bank of India (Transfer to Public Ownership) Act, 1948 (RBI, 2005b).[Reference] By the 1960s, the Indian banking industry had become an important tool to facilitate the development of the Indian economy. At the same time, it had emerged as a large employer, and a debate had ensued about the possibility to nationalise the banking industry. Indira Gandhi, the-then Prime Minister of India expressed the intention of the GOI in the annual conference of the All India Congress Meeting in a paper entitled "Stray thoughts on Bank Nationalisation." The paper was received with positive enthusiasm. Thereafter, her move was swift and sudden, and the GOI issued an ordinance and nationalised the 14 largest commercial banks with effect from the midnight of July 19, 1969. Jayaprakash Narayan, a national leader of India, described the step as a "masterstroke of political sagacity." Within two weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9 August 1969. A second dose of nationalization of 6 more commercial banks followed in 1980. The stated reason for the nationalization was to give the government more control of credit delivery. With the second dose of nationalization, the GOI controlled around 91% of the banking business of India. Later on, in the year 1993, the government merged New Bank of India with Punjab National Bank. It was the only merger between nationalized banks and resulted in the reduction of the number of nationalised banks from 20 to 19. After this, until the 1990s, the nationalised banks grew at a pace of around 4%, closer to the average growth rate of the Indian economy.

2.5 Liberalization of banks

In the early 1990s, the then Narsimha Rao government embarked on a policy of liberalization, licensing a small number of private banks. These came to be known as New Generation tech-savvy banks, and included Global Trust Bank (the first of such new

generation banks to be set up), which later amalgamated with Oriental Bank of Commerce, Axis Bank(earlier as UTI Bank), ICICI Bank and HDFC Bank. This move, along with the rapid growth in the economy of India, revitalized the banking sector in India, which has seen rapid growth with strong contribution from all the three sectors of banks, namely, government banks, private banks and foreign banks.

The next stage for the Indian banking has been setup with the proposed relaxation in the norms for Foreign Direct Investment, where all Foreign Investors in banks may be given voting rights which could exceed the present cap of 10%, at present it has gone up to 74% with some restrictions. The new policy shook the Banking sector in India completely. Bankers, till this time, were used to the 4-6-4 method (Borrow at 4%; Lend at 6%;Go home at 4) of functioning. The new wave ushered in a modern outlook and tech-savvy methods of working for traditional banks. All this led to the retail boom in India. People not just demanded more from their banks but also received more. Currently (2007), banking in India is generally fairly mature in terms of supply, product range and reach-even though reach in rural India still remains a challenge for the private sector and foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered to have clean, strong and transparent balance sheets relative to other banks in comparable economies in its region. The Reserve Bank of India is an autonomous body, with minimal pressure from the government. The stated policy of the Bank on the Indian Rupee is to manage volatility but without any fixed exchange rate-and this has mostly been true. With the growth in the Indian economy expected to be strong for quite some time-especially in its services sector-the demand for banking services, especially retail banking, mortgages and investment services are expected to be strong. One may also expect M&As, takeovers, and asset sales. In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has been allowed to hold more than 5% in a private sector bank since the RBI announced norms in 2005 that any stake exceeding 5% in the private sector banks would need to be vetted by them.

In recent years critics have charged that the non-government owned banks are too aggressive in their loan recovery efforts in connection with housing, vehicle and personal loans. There are press reports that the banks' loan recovery efforts have driven defaulting borrowers to suicide.

2.6 Banks in India

In India the banks are being segregated in different groups. Each group has their own benefits and limitations in operating in India. Each has their own dedicated target market. Few of them only work in rural sector while others in both rural as well as urban. Many even are only catering in cities. Some are of Indian origin and some are foreign players. All these details and many more is discussed over here. The banks and its relation with the customers, their mode of operation, the names of banks under different groups and other such useful informations are talked about. One more section has been taken note of is the upcoming foreign banks in India. The RBI has shown certain interest to involve more of foreign banks than the existing one recently. This step has paved a way for few more foreign banks to start business in India.

Major Banks in India ABN-AMRO Bank Abu Dhabi Commercial Bank American Express Bank Andhra Bank Allahabad Bank Bank of Baroda Bank of India Indian Overseas Bank Indusind Bank ING Vysya Bank Jammu & Kashmir Bank JPMorgan Chase Bank Karnataka Bank Karur Vysya Bank

Bank of Maharashtra Bank of Punjab Bank of Rajasthan Bank of Ceylon BNP Paribas Bank Canara Bank Catholic Syrian Bank Central Bank of India Centurion Bank China Trust Commercial Bank Citi Bank City Union Bank Corporation Bank Dena Bank Deutsche Bank Development Credit Bank Dhanalakshmi Bank Federal Bank HDFC Bank HSBC ICICI Bank IDBI Bank Indian Bank

Laxmi Vilas Bank Oriental Bank of Commerce Punjab National Bank Punjab & Sind Bank Scotia Bank South Indian Bank Standard Chartered Bank State Bank of India (SBI) State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of Indore State Bank of Mysore State Bank of Saurashtra State Bank of Travancore Syndicate Bank Taib Bank UCO Bank Union Bank of India United Bank of India United Bank Of India United Western Bank UTI Bank

2.7 Fact Files of Banks in India

The first, the oldest, the largest, the biggest, get all such types of informations about Banking in India in this section. The first bank in India to be given an ISO Certification Canara Bank

The first bank in Northern India to get ISO 9002 certification for Punjab their selected branches Bank



The first Indian bank to have been started solely with Indian Punjab capital The first among the private sector banks in Kerala to become a scheduled bank in 1946 under the RBI Act India's oldest, largest and most successful commercial bank, offering the widest possible range of domestic, international and NRI products and services, through its vast network in India and overseas Bank


South Indian Bank

State Bank of India

India's second largest private sector bank and is now the largest The Federal Bank scheduled commercial bank in India Limited Bank of

Bank which started as private shareholders banks, mostly Imperial Europeans shareholders India

The first Indian bank to open a branch outside India in London in Bank in 1974 The oldest Public Sector Bank in India having branches all over India and serving the customers for the last 132 years Mumbai



1946 and the first to open a branch in continental Europe at Paris founded in 1906 in

Allahabad Bank Bank of

The first Indian commercial bank which was wholly owned and Central managed by Indians India

Bank of India was founded in 1906 in Mumbai. It became the first Indian bank to open a branch outside India in London in 1946 and the first to open a branch in continental Europe at Paris in 1974.

2.8 Public sector banks

Among the Public Sector Banks in India, United Bank of India is one of the 14 major banks, which were nationalized on July 19, 1969. Its predecessor, in the Public Sector Banks, the United Bank of India Ltd., was formed in 1950 with the amalgamation of four banks viz.

Oriental Bank of Commerce (OBC), Government of India Undertaking offers Domestic, NRI and Commercial banking services. OBC is implementing a GRAMEEN PROJECT in Dehradun District (UP) and Hanumangarh District (Rajasthan) disbursing small loans. This Public Sector Bank India has implemented 14 point action plan for strengthening of credit delivery to women and has designated 5 branches as specialized branches for women entrepreneurs.

2.8.1 The following are the list of Public Sector Banks in India
Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Oriental Bank of Commerce

Punjab & Sind Bank Punjab National Bank Syndicate Bank UCO Bank Union Bank of India United Bank of India Vijaya Bank

2.8.2 List of State Bank of India and its subsidiary, a Public Sector Banks
State Bank of India State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of Indore State Bank of Mysore State Bank of Saurashtra State Bank of Travancore

2.9 Private sector banks

Private banking in India was practiced since the beginning of banking system in India. The first private bank in India to be set up in Private Sector Banks in India was Indusind Bank. It is one of the fastest growing Bank Private Sector Banks in India. IDBI ranks the tenth largest development bank in the world as Private Banks in India and has promoted world class institution in India.

The first Private Bank in India to receive an in principle approval from the Reserve Bank of India was Housing Development Finance Corporation Limited, to set up a bank in the private sector banks in India as part of the RBI's liberalization of the Indian Banking Industry. It was incorporated in August 1994 as HDFC Bank Limited with registered office in Mumbai and commenced operations as Scheduled Commercial Bank in January 1995. ING Vysya, yet another Private Bank of India was incorporated in the year 1930. Bangalore has a pride of place for having the first branch inception in the year 1934. With successive years of patronage and constantly setting new standards in banking, ING Vysya Bank has many credits to its account.

2.9.1 List of Private Banks in India

Bank of Punjab Bank of Rajasthan Catholic Syrian Bank Centurion Bank City Union Bank Dhanalakshmi Bank Development Credit Bank Federal Bank HDFC Bank ICICI Bank IDBI Bank Indusind Bank ING Vysya Bank Jammu & Kashmir Bank Karnataka Bank

Karur Vysya Bank Laxmi Vilas Bank South Indian Bank United Western Bank

2.10 Indian banking industry

The Indian banking market is growing at an astonishing rate, with Assets expected to reach US$1 trillion by 2010. An expanding economy, middle class, and technological innovations are all contributing to this growth. The countrys middle class accounts for over 320 million People. In correlation with the growth of the economy, rising income levels, increased standard of living, and affordability of banking products are promising factors for continued expansion. The Indian banking market is growing at an astonishing rate, with Assets expected to reach US$1 trillion by 2010. An expanding economy, middle class, and technological innovations are all contributing to this growth.

The Indian banking Industry is in the middle of an expansion of centric in retail and rural banking. Players


revolution, Focusing on the

are becoming increasingly customer -

their approach, which has resulted in innovative methods of offering new banking The banking industry should focus on having a small number of

products and services. players."

large players that can compete globally rather than having a large number of fragmented

Introduction of Company
Industrial Development Bank of India Ltd.

Type Industry

Public (BSE: 500116) Banking Financial services

Founded Headquarters Key people Products Revenue

July 1964 Mumbai, India Shri R. M. Malla, CMD Finance and insurance Rs 20685 Crore (2011) [1]

Operating income Rs 4158 Crore (2011) Net income Employees Website Rs 1650 Crore (2011) 8,989

3.1 History
3.1.1 Industrial Development Bank of India
Industrial Development bank of India (IDBI) was constituted under Industrial Development bank of India Act, 1964 as a Development Financial Institution and came into being as on July 01, 1964 wide goal notification dated June 22, 1964. It was regarded as a Public Financial Institution in terms of the provisions of Section 4A of the Companies Act, 1956. It continued to serve as a DFI for 40 years till the year 2004 when it was transformed into a Bank.

3.1.2 Industrial Development Bank of India Limited

In response to the felt need and on commercial prudence, it was decided to transform IDBI into a Bank. For the purpose, Industrial Development bank Act, 2003 [Repeal Act] was passed repealing the Industrial Development Bank of India Act, 1964. In terms of the provisions of the Repeal Act, a new company under the name of Industrial Development Bank of India Limited (IDBI Ltd.) was incorporated as a Govt. Company under the Companies Act, 1956 on September 27, 2004. Thereafter, the undertaking of IDBI was transferred to and vested in IDBI Ltd. with effect from the effective date of October 01, 2004. In terms of the provisions of the Repeal Act, IDBI Ltd. has been functioning as a Bank in addition to its earlier role of a Financial Institution.

3.1.2 Merger of IDBI bank Ltd. with IDBI Ltd.

Towards achieving the faster inorganic growth of the Bank, IDBI Bank Ltd., a wholly owned subsidiary of IDBI Ltd. was amalgamated with IDBI Ltd. in terms of the provisions of Section 44A of the Banking Regulation Act, 1949 providing for voluntary amalgamation of two banking companies. The merger became effective from April 02, 2005.

3.1.3 Merger of United Western bank with IDBI Ltd.

The United Western bank Ltd. (UWB), a Satara based private sector bank was placed under moratorium by RBI. Upon IDBI Ltd. showing interest to take over the said bank towards its further inorganic growth, RBI and Govt. of India amalgamated UWB with IDBI Ltd. in terms

of the provisions of Section 45 of the Banking Regulation Act, 1949. The merger came into effect on October 03, 2006.

3.1.4 Change of name of IDBI Ltd. to IDBI Bank Ltd.

In order that the name of the Bank truly reflects the functions it is carrying on, the name of the Bank was changed to IDBI Bank Limited and the new name became effective from May 07, 2008 upon issue of the Fresh Certificate of Incorporation by Registrar of Companies, Maharashtra. The Bank has been accordingly functioning in its present name of IDBI Bank Limited.

3.2 Vision
To be the trusted partner in progress by leveraging quality human capital and selling global standards of excellence to build the most valued financial conglomerate.

3.3 Quality of Products and Services

IDBI Bank Ltd. shall continue to be committed to creating new industry standards of excellence in customer service. IDBI Bank Ltd. shall provide innovative and superior quality customer service consistent with the requirements of the customers for their satisfaction.


3.4 Corporate Opportunity

A Director / Officer / Employee must not deprive IDBI Bank Ltd. of an opportunity that belongs to IDBI Bank Ltd., for his/ her own/other's advantage, if he / she is in a position of diverting the corporate opportunity for own benefit or to others to the detriment of IDBI Bank Ltd. A Director / Officer / Employee must not compete with IDBI Bank Ltd. in respect of any business transaction.

3.5 IDBI Bank Organizational Chart

Vice president Vice president Chairman President Operations Marketing Finance H. R.

Regional Head

Zonal Head

Divisional Sales Manager

Territory In charge

3.6 Board of Directors

Mr. R.M. Malla (Chairman & managing director) Mr. B. P. Singh (Deputy managing Director)

Mr. Rakesh Singh

Mr. R.P. Singh

Ms.Lila Firoz Poonawalla Mr. Hiralal Zutshi Dr. B.S. Bisht

Mr. K. Narasimha Murthy Mr. Subhash Tuli

3.7 Recruitments
In our continuous endeavour to improve the selection process for recruitment at all levels in IDBI Bank, we have carried out an in-depth study of the competencies required to succeed in IDBI Bank. As a rapidly growing organization we look to induct talent from various reputed business schools/educational institute across the country. Enthusiastic and talented youth form the backbone of our banking operations and will become our future leaders. What we offer is the grooming needed to be the best. We offer a wide range of careers in all functions including Finance, Marketing, Operations and Human Resources. We are proud of our ability to nurture individuals and provide them the space and empowerment they need to hone their talents. Our size gives us the unique ability to provide fast growth and high responsibility early in ones career as well as multiple avenues to reach the top.

3.8 Management & Organisation

IDBI Bank is a Board-managed organisation. The responsibility for the day-to-day management of operations of the Bank is vested with the Chairman & Managing Director and Deputy Managing Director, who draw upon the support and expertise of a cross-disciplinary Top Management Team. IDBI Bank Ltd.'s employee base includes professionals from the fields of accountancy, management, engineering, law, computer technology, banking and economics.

3.9 Corporate Social Responsibility

IDBI Bank Ltd. shall continue to be committed to be a good corporate citizen not only in compliance with all relevant regulating laws and regulations but also by actively assisting in

the improvement of the quality of life of the people in the communities in which it operates with the objective of making them self reliant.

3.10 Corporate Governance

IDBI upholds the highest standards of corporate governance in its operations. The responsibility for maintaining these high standards of governance lies with its Board of Directors. Two Committees of the Board viz. the Executive Committee and the Audit Committee are adequately empowered to monitor implementation of good corporate governance practices and making necessary disclosures within the framework of legal provisions and banking conventions.

3.11 Milestones
July 1964: Set up under an Act of Parliament as a wholly-owned subsidiary of Reserve Bank of India. February 1976: Ownership transferred to Government of India. Designated Principal Financial Institution for co-coordinating the working of institutions at national and State levels engaged in financing, promoting and developing industry. March 1982: International Finance Division of IDBI transferred to Export-Import Bank of India, established as a wholly-owned corporation of Government of India, under an Act of Parliament. April 1990: Set up Small Industries Development Bank of India (SIDBI) under SIDBI Act as a wholly-owned subsidiary to cater to specific needs of small-scale sector. In terms of an amendment to SIDBI Act in September 2000, IDBI divested 51% of its shareholding in SIDBI in favor of banks and other institutions in the first phase. IDBI has subsequently divested 79.13% of its stake in its erstwhile subsidiary to date. January 1992: Accessed domestic retail debt market for the first time with innovative Deep Discount Bonds; registered path-breaking success. December 1993: Set up IDBI Capital Market Services Ltd. as a wholly-owned subsidiary to offer a broad range of financial services, including Bond Trading, Equity Broking, Client Asset Management and Depository Services. IDBI Capital is currently a leading Primary Dealer in the country.

September 1994: Set up IDBI Bank Ltd. in association with SIDBI as a private sector commercial bank subsidiary, a sequel to RBI's policy of opening up domestic banking sector to private participation as part of overall financial sector reforms. October 1994: IDBI Act amended to permit public ownership up to 49%. July 1995: Made Initial Public Offer of Equity and raised over Rs.2000 crore, thereby reducing Government stake to 72.14%. March 2000: Entered into a JV agreement with Principal Financial Group, USA for participation in equity and management of IDBI Investment Management Company Ltd., erstwhile a 100% subsidiary. IDBI divested its entire shareholding in its asset management venture in March 2003 as part of overall corporate strategy. March 2000: Set up IDBI Intec Ltd. as a wholly-owned subsidiary to undertake ITrelated activities. June 2000: A part of Government shareholding converted to preference capital, since redeemed in March 2001; Government stake currently 58.47%. August 2000: Became the first All-India Financial Institution to obtain ISO 9002:1994 Certification for its treasury operations. Also became the first organisation in Indian financial sector to obtain ISO 9001:2000 Certification for its forex services. March 2001: Set up IDBI Trusteeship Services Ltd. to provide technology-driven information and professional services to subscribers and issuers of debentures. February 2002: Associated with select banks/institutions in setting up Asset Reconstruction Company (India) Limited (ARCIL), which will be involved with the Strategic management of non-performing and stressed assets of Financial Institutions and Banks. September 2003: IDBI acquired the entire shareholding of Tata Finance Limited in Tata Home finance Ltd, signaling IDBI's foray into the retail finance sector. The housing finance subsidiary has since been renamed 'IDBI Home finance Limited'. December 2003: On December 16, 2003, the Parliament approved The Industrial Development Bank (Transfer of Undertaking and Repeal Bill) 2002 to repeal IDBI Act 1964. The President's assent for the same was obtained on December 30, 2003. The Repeal Act is aimed at bringing IDBI under the Companies Act for investing it with the requisite operational flexibility to undertake commercial banking business

under the Banking Regulation Act 1949 in addition to the business carried on and transacted by it under the IDBI Act, 1964. July 2004: The Industrial Development Bank (Transfer of Undertaking and Repeal) Act 2003 came into force from July 2, 2004. July 2004: The Boards of IDBI and IDBI Bank Ltd. take in-principle decision regarding merger of IDBI Bank Ltd. with proposed Industrial Development Bank of India Ltd. in their respective meetings on July 29, 2004. September 2004: The Trust Deed for Stressed Assets Stabilization Fund (SASF) executed by its Trustees on September 24, 2004 and the first meeting of the Trustees was held on September 27, 2004. September 2004: The new entity "Industrial Development Bank of India" was incorporated on September 27, 2004 and Certificate of commencement of business was issued by the Registrar of Companies on September 28, 2004. September 2004:Notification issued by Ministry of Finance specifying SASF as a financial institution under Section 2(h)(ii) of Recovery of Debts due to Banks & Financial Institutions Act, 1993. September 2004:Notification issued by Ministry of Finance on September 29, 2004 for issue of non-interest bearing goal IDBI Special Security, 2024, aggregating Rs.9000 crore, of 20-year tenure. September 2004: Notification for appointed day as October 1, 2004, issued by Ministry of Finance on September 29, 2004. September 2004:RBI issues notification for inclusion of Industrial Development Bank of India Ltd. in Schedule II of RBI Act, 1934 on September 30, 2004. October 2004: Appointed day - October 01, 2004 - Transfer of undertaking of IDBI to IDBI Ltd. IDBI Ltd. commences operations as a banking company. IDBI Act, 1964 stands repealed. January 2005: The Board of Directors of IDBI Ltd., at its meeting held on January 20, 2005, approved the Scheme of Amalgamation, envisaging merging of IDBI Bank Ltd. with IDBI Ltd. Pursuant to the scheme approved by the Boards of both the banks, IDBI Ltd. will issue 100 equity shares for 142 equity shares held by shareholders in IDBI Bank Ltd. EGM has been convened on February 23, 2005 for seeking shareholder approval for the scheme.

3.12 Investor

IDBI Bank Ltd. is a Universal Bank with its operations driven by a cutting edge core Banking IT platform. The Bank offers personalized banking and financial solutions to Its clients through its large network of Branches, ATMs spread across length and breadth of India. Our experience of financial markets helps us to adopt appropriate strategies to mitigate the entire range of risks, effectively cope with challenges and capitalize on the emerging opportunities by participating effectively in our countrys growth process. We are also in the process of setting up overseas branches and representative offices for encasing emerging global opportunities. It is our constant endeavour to provide you with the best of our services, if you face any issue, please get in touch with our Customer Service Manager or Branch Head at the Business Unit / Branch, where you are maintaining the relationship and they shall be glad to assist you.

3.13 Shareholders
IDBI Bank Ltd. is committed to enhance shareholder value and shall comply with all regulations and laws that govern shareholders' rights. The Board of Directors' of IDBI Bank Ltd. shall duly and fairly inform its shareholders about all relevant aspects of the organisation business and disclose such information in accordance with the respective regulations and agreements. Every employee shall also be responsible for implementation of and compliance with this code.

3.14 Financial Reporting and Records

IDBI Bank Ltd. shall continue to prepare and maintain its accounts fairly and accurately in accordance with the accounting and financial reporting standards which represent the generally accepted guidelines, principles, standards, laws and regulations of the country. Internal accounting and audit procedures shall fairly and accurately reflect all of IDBI Bank Ltd. business transactions and disposition of assets.

3.15 Health, Safety and Environment

IDBI Bank Ltd. shall strive to provide a safe and healthy working environment at its work places and comply, in the conduct of its business affairs, with all regulations regarding the preservation of the environment of the territories it operates in.

3.16 National Interest

IDBI Bank Ltd. shall continue to be committed in all its actions to benefit the economic development of the nation and shall not engage in any activity that would adversely affect such objective.

3.17 Preamble
IDBI Bank Ltd. is committed to creating long term economic value for all its stakeholders, including shareholders, depositors, customers, employees and the society as a whole. IDBI Bank Ltd. is committed to maintaining high standards of ethical and professional conduct in all its corporate activities.

3.18 Competition
IDBI Bank Ltd. shall market its products and services on its own merits.

3.19 Equal-Rights
IDBI Bank Ltd shall continue to provide equal opportunities to all its employees and all qualified applicants for employment without regard to their race, caste, religion, colour, ancestry, marital status, sex, age, nationality, disability etc. Applicable laws, rules, and guidelines of Government of India / any other Competent Authority in this regard shall also be observed for this purpose. Employees of IDBI Bank Ltd. shall be treated with dignity and in accordance with the IDBI Bank Ltd. policy to maintain a work environment free of sexual harassment, whether physical, verbal or psychological. Employee policies and practices shall be administered on a non-discriminatory basis in all matters relating to recruitment, training, compensation, benefits, promotion, transfers and all others terms and conditions of employment.

3.20 Prohibited Business

IDBI Bank Ltd. shall not enter into any kind of business with any company / organisation / entity, of which any of its director of is a proprietor, partner, director, a manager, employee or guarantor or in which one or more directors of IDBI Bank Ltd. together hold substantial interest. Substantial interest, in relation to any company / organisation / entity, means any beneficial interest held by one or more of the directors of IDBI Bank Ltd. or by any relative of such director, whether singly or taken together, in the shares of the company / organisation / entity, the aggregate amount paid up on which either exceeds five lakh of rupees or 5% of its paidup share capital, whichever is lesser.

3.21 Public Representation of the Company & the Group

IDBI Bank Ltd. honours the information requirements of the public and its stakeholders. All its external communication will be only by officials / directors authorised for the purpose.

The information for the public constituents and stakeholders, duly approved by the Compliance Officer or other authorised official, as the case may be, shall be disseminated through any of the following media: - The accredited newspaper publications; - Web casting on the official web site; - Press handouts and press releases; - Audio and audio-visuals prepared for the specific purpose. Use of IDBI Bank Ltd. Name Logo/ Trademarks: A Director / Officer / Employee shall not use the name of IDBI Bank Ltd., its logo or trademark for personal benefit or for the benefit of persons / entities not forming part of the IDBI Group.

3.22 Ethical Standards

A Director / Officer / Employee of IDBI Bank Ltd. shall conduct all the dealings on behalf of IDBI Bank Ltd. with professionalism, honesty, integrity and high moral and ethical standards. Every Director / Officer / Employee of IDBI Bank Ltd. shall be responsible for the implementation of and compliance with the Code in his / her professional environment, be fair and take action not to discriminate, honour confidentiality and strive to achieve more specific professional responsibilities.

3.23 Securities Transactions and Confidential Information

A Director / officer / employee of IDBI Bank Ltd. and their family members shall not derive any benefit or assist others to derive any benefit from the access to and possession of information about IDBI Bank Ltd. which is not in the public domain and thus constitutes insider information. The Director / officer / employee of IDBI Bank Ltd. shall maintain confidentiality of all price sensitive information. Unpublished price sensitive information would be disclosed only to those within the company who need the information to discharge their duty.

3.24 Protection of Bank's assets

The assets of IDBI Bank Ltd. shall not be misused but employed for conducting the business for which they are duly authorised.

3.25 Significant developments during FY 2010-11 (April March)

1) IDBI Bank brought a paradigm shift in banking by waiving charges on Current and

Savings Accounts transactions starting September 1, 2010. This is a measure to further strengthen the Bank's bond with its customers. This initiative captures the Banks philosophy of valuing the customers more than their money. 2) IDBI Bank has merged two of its wholly owned subsidiaries, IDBI Home Finance Ltd. and IDBI Gilts Ltd. with itself on January 1, 2011. 3) In July 2010, IDBI Bank has received Rs. 3,119.04 Crore from the Government of India towards consideration for preferential issue of equity shares to GoI at a price of Rs.120.19 per share in terms of the approval accorded by the Shareholders at the sixth AGM of the Bank. With this capital infusion, GoI stake in IDBI Bank has risen to around 65.13%. 4) IDBI Bank Ltd. launched the Cash at POS facility at Mumbai. IDBI Bank is amongst the first few banks to launch this facility. The facility would enable debit card holders of any bank in India to withdraw cash of upto Rs.1000 per day at designated merchant establishments by swiping their debit cards on the Point of Sale (POS) terminals. The facility can be availed of either as a pure cash withdrawal or along with purchase of goods & services. The merchant establishment will not levy any charges for dispensing cash. IDBI Bank has decided to offer this facility free of charge to its debit card holders. 5) IDBI Bank launched a multi-currency remittance facility for making payments in miscellaneous currencies. With this facility, IDBI Bank now offers its customers, remittance facility in more than 125 currencies. 6) With increasing focus towards the Micro, Small & Medium Enterprises (MSME) sector, IDBI Bank has signed a MoU with the Small Industries Development Bank of India (SIDBI) for joint financing of MSMEs. Further, the Bank has signed another MoU with World Resources Institute (WRI) for financing MSMEs for implementing ESCO (Energy Saving Company) projects. 7) In recognition of its initiatives in the SME sector, IDBI Bank has received the Best Public Sector Bank award in SME Financing from global business information provider Dun & Bradstreet (D&B) in August 2010. 8) Given its focus on promoting Financial Inclusion, IDBI Bank has recently launched Urban Financial Inclusion Drive to include the urban-poor population of the country under the fold of banking services through an extensive usage of biometric smart cards and handheld devices. 9) IDBI Bank has become a Registrar for Unique Identification Authority of India (UIDAI). A Memorandum of Understanding (MoU) was signed by the Bank and Unique

Identification Authority of India (UIDAI), on January 10, 2011. IDBI Bank plans to dovetail its Financial Inclusion Plan with the UID enrolment for new customers. It will also facilitate issuance of Aadhaar number for its existing customers which will enable the Bank to deploy Aadhaar based services across various delivery channels like ATMs and Micro ATMs. 10) IDBI Bank was conferred the Award for the Fastest Growing Bank at Best Bank Awards organized by Business Today. IDBI Bank was the recipient of the Award in the Large Banks Category. 11) IDBI Bank has been identified for award of The most admired Debt Financier in Infrastructure Sector by KPMG and Infrastructure Today. 12) IDBI Bank was conferred the Award for Brand Excellence at the World Brand Congress 2010 organized by CMO, Asia. IDBI Bank was the recipient of the Award in the Banking Category. 13) IDBI Bank Ltd. was awarded the coveted international certification ISO 9001:2008 for all its Currency Chests across the country in June 2010. Subsequently, the Bank was awarded the same certification for its Centralised Clearing Units across the country. 14) IDBI Bank, along with the technology partner Oracle won the Asian Banker Technology Implementation Award 2011 for Best Data and Analytics Project for implementing an analytics solution that measures and analyses interest rate and liquidity risks, integrates its performance management framework and conducts faster and robust scenario analyses. 15) At the Banking Technology Awards instituted by the IBA, IDBI Bank received the award for best use of Business Intelligence and best Risk Management. The Bank was a runner up in the category for use of Technology in training and e-learning initiatives.

3.26 Competitors of IDBI bank

The major competitor of IDBI bank is given below: (1) SBI (2) PNB (3) BANK OF INDIA (4) BANK OF BARODA (5) CANARA BANK All the other banks are the competitors of IDBI as IDBI deals with a variety of products.


State Bank of India is the largest and one of the oldest commercial bank in India, in existence for more than 200 years. The bank provides a full range of corporate, commercial and retail banking services in India. Indian central bank namely Reserve Bank of India (RBI) is the

major share holder of the bank with 59.7% stake. The bank is capitalized to the extent of Rs.646bn with the public holding (other than promoters) at 40.3%. SBI has the largest branch and ATM network spread across every corner of India. The bank has a branch network of over 14,000 branches (including subsidiaries). Apart from Indian network it also has a network of 73 overseas offices in 30 countries in all time zones, correspondent relationship with 520 International banks in 123 countries. In recent past, SBI has acquired banks in Mauritius, Kenya and Indonesia. The bank had total staff strength of 198,774 as on 31st March, 2006. Of this, 29.51% are officers, 45.19% clerical staff and the remaining 25.30% were sub-staff. The bank is listed on the Bombay Stock Exchange, National Stock Exchange, Kolkata Stock Exchange, Chennai Stock Exchange and Ahmedabad Stock Exchange while its GDRs are listed on the London Stock Exchange. SBI group accounts for around 25% of the total business of the banking industry while it accounts for 35% of the total foreign exchange in India. With this type of strong base, SBI has displayed a continued performance in the last few years in scaling up its efficiency levels. Net Interest Income of the bank has witnessed a CAGR of 13.3% during the last five years. During the same period, net interest margin (NIM) of the bank has gone up from as low as 2.9% in FY02 to 3.40% in FY06 and currently is at 3.32%.

The origin of the State Bank of India goes back to the first decade of the nineteenth century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A unique institution, it was the first joint-stock bank of British India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921. Primarily Anglo-Indian creations, the three presidency banks came into existence either as a result of the compulsions of imperial finance or by the felt needs of local European commerce and were not imposed from outside in an arbitrary manner to modernise India's economy. Their evolution was, however, shaped by ideas culled from similar developments in Europe and England, and was influenced by changes occurring in the structure of both the local trading environment and those in the relations of the Indian economy to the economy of Europe and the global economic framework.

Punjab National Bank

With over 60 million satisfied customers and more than 5100 offices including 5 overseas branches, PNB has continued to retain its leadership position amongst the nationalized banks. The bank enjoys strong fundamentals, large franchise value and good brand image. Besides being ranked as one of India's top service brands, PNB has remained fully committed to its guiding principles of sound and prudent banking. Apart from offering banking products, the bank has also entered the credit card, debit card; bullion business; life and non-life insurance; Gold coins & asset management business, etc. PNB has earned many awards and accolades during the year in appreciation of excellence in services, Corporate Social Responsibility (CSR) practices, transparent governance structure, best use of technology and good human resource management. Since its humble beginning in 1895 with the distinction of being the first Swadeshi Bank to have been started with Indian capital, PNB has achieved significant growth in business which at the end of March 2011 amounted to Rs 5,55,005 crore. PNB is ranked as the 2nd largest bank in the country after SBI in terms of branch network, business and many other parameters. During the FY 2010-11, with 39.16% share of CASA to domestic deposits, the Bank achieved a net profit of Rs 4433 crore. Bank has a strong capital base with capital adequacy ratio of 12.42% as on Mar11 as per Basel II with Tier I and Tier II capital ratio at 8.44% and 3.98% respectively. As on March11, the Bank has the Gross and Net NPA ratio of 1.79% and 0.85% respectively. During the FY 2010-11, its ratio of Priority Sector Credit to Adjusted Net Bank Credit at 40.67% & Agriculture Credit to Adjusted Net Bank Credit at 19.30% was also higher than the stipulated requirement of 40% & 18% respectively. The Bank has been able to maintain its stakeholders interest by posting an improved NIM of 3.96% in Mar11 (3.57% Mar10). The Earning per Share improved to Rs 140.60 (Rs 123.86 Mar10) while the Book value per share improved to Rs 661.20 (Rs 514.77 Mar10). Punjab National Bank continues to maintain its frontline position in the Indian banking industry. In particular, the bank has retained its NUMBER ONE position among the nationalized banks in terms of number of branches, Deposit, Advances, total Business, Assets, Operating and Net profit in the year 2010-11. The impressive operational and financial performance has been brought about by Banks focus on customer based business with thrust on CASA deposits,

Retail, SME & Agriculture Advances and with more inclusive approach to banking; better asset liability management; improved margin management, thrust on recovery and increased efficiency in core operations of the Bank. The performance highlights of the bank in terms of business and profit are shown below:

Bank of India History

Bank of India was founded on 7th September, 1906 by a group of eminent businessmen from Mumbai. The Bank was under private ownership and control till July 1969 when it was nationalised along with 13 other banks. Beginning with one office in Mumbai, with a paid-up capital of Rs.50 lakh and 50 employees, the Bank has made a rapid growth over the years and blossomed into a mighty institution with a strong national presence and sizable international operations. In business volume, the Bank occupies a premier position among the nationalised banks. The Bank has 3101 branches in India spread over all states/ union territories including 141 specialized branches. These branches are controlled through 48 Zonal Offices . There are 29 branches/ offices (including three representative offices) abroad. The Bank came out with its maiden public issue in 1997 and follow on Qualified Institutions Placement in February 2008. . Total number of shareholders as on 30/09/2009 is 2,15,790. While firmly adhering to a policy of prudence and caution, the Bank has been in the forefront of introducing various innovative services and systems. Business has been conducted with the

successful blend of traditional values and ethics and the most modern infrastructure. The Bank has been the first among the nationalised banks to establish a fully computerized branch and ATM facility at the Mahalaxmi Branch at Mumbai way back in 1989. The Bank is also a Founder Member of SWIFT in India. It pioneered the introduction of the Health Code System in 1982, for evaluating/ rating its credit portfolio. The Bank's association with the capital market goes back to 1921 when it entered into an agreement with the Bombay Stock Exchange (BSE) to manage the BSE Clearing House. It is an association that has blossomed into a joint venture with BSE, called the BOI Shareholding Ltd. to extend depository services to the stock broking community. Bank of India was the first Indian Bank to open a branch outside the country, at London, in 1946, and also the first to open a branch in Europe, Paris in 1974. The Bank has sizable presence abroad, with a network of 29 branches (including five representative office) at key banking and financial centers viz. London, New York, Paris, Tokyo, Hong-Kong and Singapore. The international business accounts for around 17.82% of Bank's total business.

Bank Of Baroda

Bank of Baroda has been a long and eventful journey of almost a century across 26 countries. Starting in 1908 from a small building in Baroda to its new hi-rise and hi-tech Baroda Corporate Centre in Mumbai, is a saga of vision, enterprise, financial prudence and corporate governance. It is a story scripted in corporate wisdom and social pride. It is a story crafted in private capital, princely patronage and state ownership. It is a story of ordinary bankers and their extraordinary contribution in the ascent of Bank of Baroda to the formidable heights of corporate glory. It is a story that needs to be shared with all those millions of people customers, stakeholders, employees & the public at large - who in ample measure, have contributed to the making of an institution.

C n a r a

Canara bank

Widely known for customer centricity, Canara Bank was founded by Shri Ammembal Subba Rao Pai, a great visionary and philanthropist, in July 1906, at Mangalore, then a small port in Karnataka. The Bank has gone through the various phases of its growth trajectory over hundred years of its existence. Growth of Canara Bank was phenomenal, especially after nationalization in the year 1969, attaining the status of a national level player in terms of geographical reach and clientele segments. Eighties was characterized by business diversification for the Bank. In June 2006, the Bank completed a century of operation in the Indian banking industry. The eventful journey of the Bank has been characterized by several memorable milestones. Today, Canara Bank occupies a premier position in the comity of Indian banks. With an unbroken record of profits since its inception, Canara Bank has several firsts to its credit.

Late Sri Ammembal Subba rao Pai

Founded as 'Canara Bank Hindu Permanent Fund' in 1906, by late Sri. Ammembal Subba rao Pai, a philanthropist, this small seed blossomed into a limited company as 'Canara Bank Ltd.' in 1910 and became Canara Bank in 1969 after nationalization. "A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve the economic conditions of the common people" - A. Subba Rao Pai. - A. Subba Rao Pai.

3.27 Top ten banks of India

Indias GDP has been growing at a rapid clip over the past decade and is set to grow at even a faster pace in the coming decade. Financial services penetration of the Indian economy is quite low compared to even other developing economies with majority of the Indian population mired in poverty, access to banks and financial companies is quite hard as people lack knowledge and education. Indias banks have grown at a rapid pace over the past 2 decades after the financial liberalization. However this growth has still lacked in meeting the massive demand in the need of financial intermediation. This has led to the growth on nonbanking financing companies (NBFCs) and microfinance companies. With the opening of the insurance sector, financial companies in India are set to enter a new growth phase. Major banks in India are either state owned or previous government owned institutions which have been fully privatized like ICICI and HDFC bank. Both the state owned banks and the private banks have managed to grow without throwing the whole system in a crisis like what has happened in the recent past in Europe and USA and in China in the 1990s.Here is a list of the 10 Major Banks in India


State Bank of India

SBI is Indias Largest Bank which is majority owned by the Government. The Company has a number of Subsidiaries and has been a market outperformer in recent times. Revenues of $22 Billion. The SBI has 7 subsidiaries of which 2 have been merged and 5 are remaining.

(1)State Bank Bikaner Jaipur (2)State Bank of Hyderabad (3)State Bank of Mysore (4)State Bank of Patiala (5)State Bank of Travancore

2) ICICI Bank
This is the largest Indian Private Bank with operations in all Financial Services Sectors. The Company has faced a bad time during the Lehman downturn but has recovered well. Revs of $12.5 Billion. ICICI Bank is also strong in almost all sectors of the financial industry and has one of the strongest management teams in the country. Like HDFC Bank majority of the shareholding is held by foreign investors. The company which overextended itself in the 2007-2008 boom has now reduced the size of its risky segments and is again back on the growth trajectory.

3) HDFC Bank
HDFC Bank like Axis Bank has shown remarkable growth in the last few years. The Bank which was founded by Indias largest housing finance company HDFC has assets of around $22 billion. One of the best rated banks in terms of service quality and growth.

4) Punjab National Bank

Punjab National Bank (PNB ,is the second largest PSU bank while at the same time managed to control bad debt. with about 5000

branches across 764 cities. The Bank like BOB and SBI has shown good growth

5) Axis Bank
Axis Bank has been the best performing private bank along with HDFC Bank showing excellent growth in top line and bottom line. The Bank has been expanding into insurance and investment banking. Axis Bank was formerly UTI Bank that begun operations in 1994.The Bank was promoted jointly by UTI,LIC and other state owned general insurers. One of the best Indian bank stock picks.

Bank of Baroda
Bank of Baroda (BoB) is the third largest bank in India and is government owned like SBI and PNB. BOB as it is popularly known has shown excellent growth over the last few years and has managed to control its Non-Performing Asset (NPA).The Bank has good management and manages to earn nice interest spreads.

7) Bank of India

Bank of India (BoI) is Indias 4th largest bank, with 3374 branches, including 27 branches outside India. It was the first bank in India promoted by Indian interests to serve all the communities of India. The stock of the company has not performed as well as it peers post the Lehman crisis. It has seen its market cap decrease relative to its larger PSU Bank peers

8) IDBI Bank
Industrial Development Bank of India Limited(IDBI) is a leading public sector banks.RBI categorised IDBI as an other public sector bank. The commercial banking arm, IDBI BANK, was merged into IDBI. This PSU Bank has supposed have great potential and could be the next ICICI in the making.

9) Kotak Mahindra Bank

This is the first NBFC to convert into a bank. The bank has its origins as an investment bank and is still very strong in the capital markets. The Bank and its sister concerns are present in most of the financial segments of the market like Private Equity, Wealth Management, Broking, Investment Banking etc.

10)Yes Bank
Yes Bank was founded by Ashok Kapoor and Rana Kapoor. This bank though still small compared to its larger peers has come into the top 10 due to its path breaking performance over the last few years in terms of growth. It has managed to set new standards and has broken out from the league of smaller private banks.

Pest Analysis






3.28 Pest analysis

PEST analysis of any industry investigates the important factors that affect the industry and influence the companies operating in the sector. PEST stands for Political, Economic, Social and Technological analysis. The PEST Analysis is a tool to analyze the forces that drive the industry and how those factors can influence the industry.

3.28.1 Political factors

Government and RBI policies affect the banking sector. Sometimes looking into the political advantage of a particular party, the Government declares some measures to their benefits like waiver of short-term agricultural loans, to attract the farmers votes. By doing so the profits of the bank get affected. Various banks in the cooperative sector are open and run by the politicians. They exploit these banks for their benefits. Sometimes the government appoints various chairmen of the banks. Various policies are framed by the RBI looking at the present situation of the country for better control over the banks. Focus on regulations of government

Indian Banking is least affected as compare to other developed economy which is attributed to Reserve Bank of India for its robust policy framework, stricter prudential regulations with respect to capital and liquidity. This gives India an advantage in terms of credibility over other countries. Government affects the performance of banking sector most by legislature and framing policy .government through its budget affects the banking activities securitization act has given more power to banking sector against defaulting borrowers. Monetary policy

Monetary Policy 2009-2010 Bank Rate: The Bank Rate has been retained unchanged at 6.0%.

Repo Rate: It has been reduced under the Liquidity Adjustment Facility (LAF) by 25 basis points from 5.0% to 4.75% with immediate effect. Reverse Repo Rate : It has been reduced under LAF by 25 basis points from 3.5% to 3.25% with immediate effect. RBI has retained the option to conduct overnight or longer term repo/reverse repo under the LAF depending on market conditions and other relevant factors. Cash Reserve Ratio: CRR has been retained unchanged at 5.0% of NDTL FDI limit

The move to increase Foreign Direct Investment FDI limits to 49 percent from 20 percent during the first quarter of this fiscal came as a welcome announcement to foreign players wanting to get a foot hold in the Indian Markets by investing in willing Indian partners who are starved of net worth to meet CAR norms. Ceiling for FII investment in companies was also increased from 24.0 percent to 49.0 percent and have been included within the ambit of FDI investment Budget measures Budget provisions

Increase Farm Credit: The FM has further increase the farm credit target for 2009-10 at Rs 325000 crore compared to Rs 287000 crore targeted in 2008-09. Subvention of 1% to be paid as incentive to farmers: The Budget continued the Interest subvention scheme for short-term crop loans up to Rs 300000 per farmer at the interest rate of 7% per annum. Also additional subvention of 1% to be paid from this year, as incentive to those farmers who repay short-term crop loans on schedule. Also additional allocation of Rs 411 crore over Interim Budget 2009-10 was made for the same. Debt Waiver for Farmers: The Union Budget 2009-10 extended the debt waiver scheme by six more months for farmers owing more than 2 hectare of land. The Union Budget 2008-09 allowed these farmers 25% rebate on loan if they repay 75% of their overdue within stipulated period of 30th June 2009. Currently this facility has been extended from 30th June, 2009 to 31st December, 2009. Setting up of separate task force for those not covered under the debt waiver scheme: The government also announced that it will set up a task force to examine the issue of debt

taken by a large number of farmers in some regions of Maharashtra from private money lenders who were not covered by the loan waiver scheme announced last year. Other provisions

The threshold for non-promoter public shareholding for all listed companies to be raised in a phased manner. To allow scheduled commercial banks setting up off-site ATMs without prior approval subject to reporting. To provide banking facilities in under-banked/un-banked areas in the next three years. A sub-committee of State level Bankers Committee (SLBC) would identify and formulate an action plan for the same. The Ministry has also granted Rs 100 crore of grants in aid to ensure provision of at least one Centre/Point of Sales (POS) for banking services in each of the un-banked blocks. Budget impact

The Union Budget 2008-09 has focused on farm credit. The agriculture sector has recorded a growth of about 4% per annum with substantial increase in plan allocations and capital formation in the sector. The one-time bank loan waiver of nearly Rs 71000 crore (Rs 710 billion) to cover an estimated 40 million farmers was one of the major highlights of the last Budget. This Union Budget has provided further six months extension of 25% rebate on loan for farmers owing more than 2 hectare of land. With Government bearing this burden, banks would not be affected much. It will only help banks to clear their most stubborn NPA accounts on banks book. Moreover the emphasize on hiking promoter shareholding in Public sector banks, expanding network with ATM's, opening of banking centre in un-banked blocks are some of the positive moves for the sector. On the flipside, the spike in government borrowings is set to adversely affect the treasury income of banks in general and public sector banks in particular, through rise in yields on government securities.

3.28.2 Economic factors

Banking is as old as authentic history and the modern commercial banking are traceable to
ancient times. In India, banking has existed in one form or the other from time to time. The present era in banking may be taken to have commenced with establishment of bank of Bengal in 1809 under the government charter and with government participation in share capital. Allahabad bank was started in the year 1865 and Punjab national bank in 1895, and thus, others followed. Every year RBI declares its 6 monthly policy and accordingly the various measures and rates are implemented which has an impact on the banking sector. Also the Union budget affects the banking sector to boost the economy by giving certain concessions or facilities. If in the Budget savings are encouraged, then more deposits will be attracted towards the banks and in turn they can lend more money to the agricultural sector and industrial sector, therefore, booming the economy. If the FDI limits are relaxed, then more FDI are brought in India through banking channels. Growing economy / GDP

Indian economy has registered a growth of more that 9 per cent for last three year and is expected to maintain robust growth rate as compare to other developed and developing countries. Banking Industry is directly related to the growth of the economy. The contributions of various sectors in the Indian GDP for 2007-2008 are as follows: Agriculture:17% Industry:29% ServiceSector:54% The Indian government is still looking up to improve the GDP of the country and so several steps have been taken to boost the economy. Policies of FDI, SEZs and NRI investment have been framed to give a push to the economy and hence the GDP. Low interest rates

Reserve Bank of India controls the Interest rate, which is based on several monetary policies. Recently RBI has reduced the interest rate which stimulates the growth rate of banking industry. As on September 11, 2009 Bank Rate was 6.00 per cent, the same as on the corresponding date of last year. Call money rates (borrowing & lending) were in the range of 1.50/3.47 per cent as compared with 5.25/11.00 per cent on the corresponding date of last year. Inflation rates

Inflation represents a rise in general level of prices of goods and services over a period of time. It leads to erosion in the purchasing power of money. Resultantly, each unit of currency buys fewer goods and services Different fiscal and monetary policies have curbed the Inflation rate from the high of 12.63 per cent to 3.92 per cent. To fight against the slowdown of the Economy, Government of India & Reserve Bank of India took many fiscal as well as monetary actions. Clubbed with fiscal & monetary actions, decreasing commodity prices, decreasing crude prices and lowering interest rate, we expect that Indian Economy could again register a robust growth rate in the year 2009-10. Inflation stands at 3.92 per cent on 7th February 2009 against a high of 12.63 per cent on 9 th August 2008. Savings and accounts

As stated earlier, India continues to remain one of the high savings economies among the emerging market economies. Gross Domestic Savings (GDS) of the Indian economy constitutes savings of public, private corporate and household sectors. In the recent period the high growth performance of the Indian economy is driven by rise in savings. Agriculture credit

Agriculture has been the mainstay of our economy with 60% of our population deriving their sustenance from it. In the recent past, the sector has recorded a growth of about 4% per annum with substantial increase in plan allocations and capital formation in the sector. Agriculture credit flow was Rs 2, 87,000 crore in 2008-09. The target for agriculture credit flow for the year 2009-10 is being set at Rs.3, 25,000 crore. To achieve this, I propose to continue the interest subvention scheme for short term crop loans to farmers for loans upto Rs.3 lakh per farmer at the interest rate of 7% per annum. For this year, the government shall pay an additional subvention of 1% as an incentive to those farmers who repay their short term crop loans on schedule. Thus, the interest rate for these farmers will come down to 6% per annum. For this, I am making an additional Budget provision of Rs 411 crore over Interim BE.

3.28.3 Socio cultural factors

Socio culture factors also affect the business. They show in which people behave in country. Socio-cultural factors like taboos, customs, traditions, tastes, preferences, buying and consumption habit of people, their language, beliefs and values affect the business. Banking industry is also operates under this social environment and it is also affect by this factor. These factor are changing continuously peoples life style, their behaviour, consumption pattern etc. is changing and also creating opportunities and threat for banking industry. There are some socio-culture factors that affect banking in India have been analyzed below. Shift towards nuclear family

Attitude of people of India is changing. Now, younger generation wants to remain separate from their parents after they get married. Joint families are breaking up. There are many reasons behind that. But banking sector is positively affected by this trend. A family need home consumer durables like freeze, washing machine, television, bike, car, etc.. so, they demand for these products and borrow from banks. Recently there is boost in housing finance and vehicle loans. As they do not have money they go for installments. So, banks satisfy nuclear families wants. Change in life style

Life style of India is changing rapidly. They are demanding high class products. They have become more advanced. People want everything car, mobile, etc.. what their fore father had dreamed for. Now teenagers also have mobile and vehicle. Even middle class people also want to have well furnished home, television, mobile, vehicle and this has opened opportunities for banking sector to tap this change. Everything is available so it has become easy to purchase anything if you do not have lump sum. Population
Increase in population is one of he important factor, which affect the private sector banks. Banks would open their branches after looking into the population demographics of the area. Percentage of deposit in any branches of banks depends upon the population demographic of that area. The population of India is about 102.90 is expected to reach about 119.70 cores in 2011. About 70% of population is below 35years of age. They are in the prime earning stage and this increase the earning of the banks. Total Deposits mobilized by the Private Sector Banks increased from Rs, 2,52,335 crore as on 31st March 2004 to Rs. 3,12,645 crore as on

31st March 2005. Deposits showed a subdued growth during 2004-05.Income distributions also affects the operations and overall business of private sector banks. Literacy rate

Literacy rate in India is very low compared to developed countries. Illiterate people hesitate to transact with banks. So, this impacts negatively on banks. But there is positive side of this as well i.e. illiterate people trust more on banks to deposit their money, they do not have market information. Opportunities in stocks ors mutual funds. So, they look bank as their sole and safe alternative. Literacy rate of India is around 65%. Literacy rate in India

Year 1951 1961 1971 1981 1991 2001 Persons 18.3 28.3 34.5 41.4 52.2 65.4 Male 27.2 40.4 46.0 53.4 64.1 75.8 female 8.9 15.3 22.0 28.5 39.3 52.1

Source: RGCCI 2001: (2001a: 114) in banks
Technology plays a very important role in banks internal control mechanisms as well as services offered by them. It has in fact given new dimensions to the banks as well as services that they cater to and the banks are enthusiastically adopting new technological innovations for devising new products and services. ATM
The latest developments in terms of technology in computer and telecommunication have encouraged the bankers to change the concept of branch banking to anywhere banking. The use of ATM and Internet banking has allowed anytime, anywhere banking facilities. Automatic voice recorders now answer simple queries, currency accounting machines makes the job easier and self-service counters are now encouraged. Credit card facility has encouraged an era of cashless society. Today MasterCard and Visa card are the two most popular cards used world over. The banks have now started issuing smartcards or debit cards to be used for making payments. These are also called as electronic purse. Some of the banks have also started home banking through telecommunication facilities and computer technology by using terminals installed at customers home and they can make the balance inquiry, get the statement of accounts, give instructions for fund transfers, etc. Through ECS we can receive the dividends and interest directly to our account avoiding the delay or chance of loosing the post. It services & mobile banking

Today banks are also using SMS and Internet as major tool of promotions and giving great utility to its customers. For example SMS functions through simple text messages sent from your mobile. The messages are then recognized by the bank to provide you with the required information. All these technological changes have forced the bankers to adopt customer-based approach instead of product-based approach Technology advancement has changed the face of traditional banking systems. Technology advancement has offer 24X7 banking even giving faster and secured service. Core banking solutions

It is the buzzword today and every bank is trying to adopt it is the centralize banking platform through which a bank can control its entire operation the adoption of core banking solution will help bank to roll out new product and services.

3.29 SWOT analysis of IDBI bank

3.29.1 Strengths:
Effective personal service
It was observed that the entire staff at IDBI Bank provides a very personalize and a cordial service to all its customers. The relationship is on a one to one basis and is not mechanical like some other Banks. Needless to say IDBI Bank has got a team of very skilled professionals who are always delivering the best of their capabilities.

Variety of Product Range

The range of retail products offered by IDBI Bank competes with the best in the industry. The product range really gives the customer a feeling, of one stop financial centre, where they can fulfil all types of financial requirements. The product range of the other new generation private banks is almost parallel.

Efficient Lead Tracking System

IDBI Bank has a very effective tool to keep a track of each and every lead that is received. The Bank has an appreciable amount of database, which can prove to be

useful for the Bank even in the future.

3.29.2 Weaknesses:
Less branches viz a viz other banks
IDBI Bank being on the growth stages of Retail Banking has not really developed a strong network of branches and ATMs. It has presently 92 branches across the country, 279 ATMs, 6 extensions counters spanning 68 cities across the country. When compared to other Private Banks of the new generation these numbers are low.

Image of IDBI Bank

Often people on hearing about IDBI Bank relate it to its parent IDBI. Also the image of IDBI Bank is of being a major thrust in Corporate Banking sector and in the area of Investment Banking for large commercial projects.

Low Awareness Due To Low Key Promotions

IDBI Bank needs to move on with more aggressive promotions.

3.29.3 Opportunities:
Increasing Interest Of People In Private Sector Banks
Due to the undesirable experiences with the Public Sector Banks, more and more people towards Private Sector Banks. People now want total hassles free Banking, which can be easily provided by the new generation Private Sector Banks.

Huge Demand and Supply Gap

Indian economy is expected to grow at 5-6% in the coming years. This growth will continue to generate demands in the retail market and the banks are appropriately suited to meet this need.

3.29.4 Threats:
Entry of New Players
The Government regulations being flexible than before, and seeing the encouraging demand in the Retail Banking Sector, entry of new players might just prove to be threat, keeping in mind the fact that IDBI Bank itself is at a growth stage of Retail Banking.

Saturate in the Segment

The Retail banking segment was identified by other Private Sector Banks like ICICI and HDFC, pretty early, therefore all the major cities and urban areas are about to get

saturated with the retail products of these Private Sector Banks.

Staff Turnover
Due to close involvement in the products offered in the Retail Banking Segment, staff turnover can be very detrimental to the interests of the Bank.

Five Forces Analysis

More than two decades ago, Professor Michael Porter suggested some driving forces which could help to analyse the attractiveness of any industry/sector as well as its competitive positioning. This framework is widely used and known as Porters Five Forces. Professor Porter invented this model in 1979 and this was published in his book in 1980. Whether the business is service oriented or physical goods, there are always competitive forces in any perfect competitive business environment.

Porters Five Forces Framework (PFFF)

3.31 Rationale of the Porters Five Forces Model in the Banking Industry

The model attempts to address key strategic issues in a wider scope. Many of the issues mentioned in the model, including the forces and the management of those forces, are relevant to the banking sector as well as any other service-oriented business. The results, which will be obtained by the application of this model, should be given the value of the time of the analysis and that a continuous review is necessary in order to avoid being my topic or obsoleting with the results. Michael Porter provided a framework that models an industry as being influenced by five forces (Porter, 1980). Figure 1 provides details of the framework.






SOURCE: Porter, M E. (1980)

It is a model of pure competition, which implies that risk-adjusted rates of return should be constant across firms and industries. However, numerous economic studies have affirmed that different industries can sustain different levels of profitability; part of this difference is explained by industry structure. Any strategic business manager seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates. The manager can then use the analysis as a basic tool for strategic decision making for the current situation or future. The banking sector of Tanzania can also consider the application of this model for some strategic decision processes. component of the model is as follows. A discussion of each

3.32 Degree of rivalry

In the traditional economic model, competition among rival firms drives profits to zero. However, competition is not perfect and firms are not unsophisticated passive price takers. Rather, firms (banks) strive for a competitive advantage over their rivals. The intensity of rivalry among firms varies across industries, and strategic analysts are interested in these differences. These differences give some firms a competitive advantage while to others a disadvantage. These differences also pose a challenge to the uniform application of this model across the board. Economists measure rivalry by indicators of industry concentration. The Concentration Ratio (CR) is one of such measures. A high concentration ratio indicates that a high concentration of market share is held by the largest firms - the industry is concentrated. With only a few firms holding a large market share, the competitive landscape is less competitive (closer to a monopoly). A low concentration ratio indicates that the industry is characterized by many rivals, none of which has a significant market share. These fragmented markets are said to be competitive. The concentration ratio is not the only available measure; the trend is to define industries in terms that convey more information than distribution of market share. If rivalry among firms in an industry is low, the industry is considered to be disciplined. This discipline may result from the industry's history of competition, the role of a leading firm, or informal compliance with a generally understood code of conduct. Explicit collusion generally is illegal and not an option; in low-rivalry industries competitive moves must be constrained informally. However, a maverick firm seeking a competitive advantage can displace the otherwise disciplined market. When a rival acts in a way that elicits a counter-response by other firms, rivalry intensifies. The intensity of rivalry commonly is referred to as being cutthroat, intense, moderate, or weak, based on the firms' aggressiveness in attempting to gain an advantage. In pursuing an

advantage over its rivals, a firm (in this case a bank) can choose from several competitive moves: Changing prices - raising or lowering prices to gain a temporary advantage. Improving product differentiation - improving features, implementing innovations in the

manufacturing process and in the product itself. The banks can equally reposition themselves from the old way the customers have been perceiving them. Those institutions, which will differentiate their products from others, will have a unique opportunity to attract customers at a premium price. A good example for this is the way Barclays bank is charging a premium fee for customers of queue less category. These customers have no time to wait in a queue hence ready to pay any fee for them to be treated differently. Creatively using channels of distribution - using vertical integration or using a distribution Exploiting relationships with suppliers. The intensity of rivalry is influenced by the channel that is novel to the industry. following industry characteristics: (i) A larger number of firms increase rivalry because more firms must compete for the same customers and resources. The rivalry intensifies if the firms have similar market share, leading to a struggle for market leadership. (ii) Slow market growth causes firms to fight for market share. In a growing market, firms are able to improve revenues simply because of the expanding market. (iii) High fixed costs result in an economy of scale effect that increases rivalry. When total costs are mostly fixed costs, the firm must produce near capacity to attain the lowest unit costs. Since the firm must sell this large quantity of products, high levels of production lead to a fight for market share and results in increased rivalry. (iv) High storage costs or highly perishable products cause a producer to sell goods as soon as possible. If other producers are attempting to unload at the same time, competition for customers intensifies. (v) Low switching costs increases rivalry. When a customer can freely switch from one product to another there is a greater struggle to capture customers. In the case of banking sector in Tanzania, the switching cost has become very low. Some competing banks a located just adjacent to one another (e.g. CRDB Holland House and Kenya Commercial bank). Some of the banks are located in the same building (E.g. Stanbic Bank and African Banking Corporation, both of them in Sukari House Building, see Table 1a). (vi) Low levels of product differentiation are associated with higher levels of rivalry. Brand identification, on the other hand, tends to constrain rivalry.

(vii) Strategic stakes are high when a firm is losing market position or has potential for great gains. This intensifies rivalry. (viii) High exit barriers place a high cost on abandoning the product. The firm must compete. High exit barriers cause a firm to remain in an industry, even when the venture is not profitable. A common exit barrier is asset specificity. (ix) A diversity of rivals with different cultures, histories, and philosophies make an industry unstable. There is greater possibility for mavericks and form is judging rival's moves. Rivalry is volatile and can be intense. (x) Industry Shakeout. A growing market and the potential for high profits induces new firms to enter a market and incumbent firms to increase production. A point is reached where the industry becomes crowded with competitors, and demand cannot support the new entrants and the resulting increased supply. The industry may become crowded if its growth rate slows and the market becomes saturated, creating a situation of excess capacity with too many goods chasing too few buyers. A shakeout ensues, with intense competition, price wars, and company failures. The founder of Boston Consulting Group (BCG) model, Bruce Henderson, generalized this observation as the rule of Three and Four: a stable market will not have more than three significant competitors, and the largest competitor will have no more than four times the market share of the smallest. If this rule is true, it implies that: If there are a larger number of competitors, a shakeout is inevitable. Surviving rivals will have to grow faster than the market. Eventual losers will have a negative cash flow if they attempt to grow. All except the two largest rivals will be losers. The definition of what constitutes the "market" is strategically important. Whatever the merits of this rule (Three & Four) for stable markets, it is clear that market stability and changes in supply and demand affect rivalry. Cyclical demand tends to create cutthroat competition.

3.33 Threat of Substitutes

In Porter's model, substitute products refer to products in other industry. To the economist, a threat of substitutes exists when a product's demand is affected by the price change of a substitute product. A product's price elasticity is affected by substitute products - as more substitutes become available, the demand becomes more elastic since customers have more alternatives. A close substitute product constrains the ability of firms (banks) in an industry to raise prices. The competition engendered by a Threat of Substitute comes from products outside the industry. In the banking sector, there are so many products and at the same time

there are so many substitute products. For example if someone is looking for a travellers cheque and that could not be provided, one might decide to opt for Telegraphic Transfer.

3.34 Buyers bargaining power

The power of buyers is the impact that customers have on a buying process of the products from a certain industry. In general, when buyers power is strong, the relationship to the industry is near to what an economist terms a monopsony a market in which there are many suppliers and one buyer. Under such market conditions, the buyer sets the price. In reality few pure monopsonies exist, but frequently there is some asymmetry between a producing industry and buyers. The same case can as well be applied to the service industry, as nowadays there is no pure-manufacturing or pure- service industry. The combination is the way forward. The only vital difference is the definition of the core product. For instance much as we consider banks to be under the service industry, physical properties like furniture, building, computers, etc are vital to make the service a possibility.

3.35 Suppliers bargaining power

A producing industry requires raw materials - labour, components, and other supplies. This requirement leads to buyer-supplier relationships between the industry and the firms that provide the raw materials used to create products. Suppliers, if powerful, can exert an influence on the producing industry, such as selling raw materials at a high price to capture some of the industry's profits. In a service sector there is no direct supplier of raw material. However the supply of supporting facilities like cheque books, furniture, stationeries, etc can give the same analogy.

3.36 Barriers to entry / Threat of new entrants

It is not only incumbent rivals that pose a threat to firms in an industry; the possibility that new firms may enter the industry also affects competition. In theory, any firm should be able to enter and exit a market, and if free entry and exit exists, then profits always should be nominal. In reality, however, industries possess characteristics that protect the high profit levels of firms in the market and inhibit additional rivals from entering the market. These are barriers to entry. Barriers to entry are more than the normal equilibrium adjustments that

markets typically make. For example, when industry profits increase, we would expect additional firms to enter the market to take advantage of the high profit levels, over time driving down profits for all firms in the industry. When profits decrease, we would expect some firms to exit the market thus restoring market equilibrium. Falling prices, or the expectation that future prices will fall, deters rivals from entering a market. Firms also may be reluctant to enter markets that are extremely uncertain, especially if entering involves expensive start-up costs. These are normal accommodations to market conditions. But if firms individually (collective action would be illegal collusion) keep prices artificially low as a strategy to prevent potential entrants from entering the market, such entry deterring pricing establishes a barrier. Barriers to entry are unique industry characteristics that define the industry. Barriers reduce the rate of entry of new firms, thus maintaining a level of profits for those already in the industry. From a strategic perspective, barriers can be created or exploited to enhance a firm's competitive advantage. If it happens that for a certain industry there are low entry barriers but high exit barriers, then this situation is referred as the worst situation of competition in that particular industry.

Data interpretation and Analysis 4.1 Secondary Data Analysis

The analysis of secondary data has been done on the basis of the different private and public sector banks schedule of charges. The result gets from this analysis is very appropriate and beneficial for the customer. The secondary data should be authentic. So we can get effective result from the research. I have done research on the various private and public sector banks schedule of charges for current and savings account. For data analysis I have taken various banks schedule of charges such as State Bank Of India, Bank of Baroda, ICICI, HDFC, Axis, Indusind and compare it with IDBI banks schedule of charges.

4.1.1 Savings Account

For saving account in above in all the bank customer have to maintain minimum

balance of 1,000 Rs. to 10,000. Every customer has to pay 100 to 750 Rs. For the average quarter balance charges (AQB) & IDBI and other bank provide this charges free to their customer. Various bank charges for electronic fund transfer (EFT) charges from 5 to 25 Rs. To their customer while IDBI banks customer gets EFT charges free. IDBI bank and other public and private bank provide cash deposition charges free to their customer. Some bank charges for this transaction from 5 to 150 Rs.
Withdrawal limit of most of the bank is similar. The limit of this transaction is 25,000

to 2,00,000 Rs. Demand draft charges of various bank is from 30 to15,000 Rs. Where IDBI and other bank charges for this transaction is absolutely free to their customer. IDBI and other Bank provide free outstanding cheque collection charges free to customer and rest of the bank charge 25 to 250 Rs. Customer has to pay 50 to 250 Rs. for statement charges. Majority of bank provide this free to customer including IDBI bank. Cheque book charges from 1to 12,500 Rs. and some bank provide free at particular limit. IDBI banks customer does not have to pay any charges for cheque book charges.

Most of the bank give 5 transactions free to the customer for cash withdrawal and balance enquiry at other bank ATM. After 5 transaction bank charges 18 to 20 Rs. IDBI bank do not charge any charges for other ATM charges for. IDBI banks customer does not have to pay any charges regarding the ATM charges. Some bank charges annual fee of ATM Rs. 50 and rest of the bank provide this charges free. Cash withdrawal and balance enquiry is free from their respective banks ATM. IDBI bank do not charge for cheque inward and outward charges while other banks customer has to pay 100 to 400 Rs. for Cheque inward charges And for cheque outward charges 50 to 350 Rs.

4.1.2 Current Account

For savings account bank offered various parameters for minimum balance require. Here customer has to require minimum balance on the basis of their geographical area such as urban, semi-urban and rural. All the customer have to maintain from 1000 to 5, 00,000 Rs. Balance in their respective bank on the basis of their types of current account. Customer has to pay 300 to 10,000 Rs. for Average quarter balance charges in their respective banks while IDBI banks customer does not have to pay any charges. For electronic fund transfer charges IDBI and other bank provide free to their customer and some of the bank charge from 2 to25 Rs. Cash deposition charges customer has to pay from 25 to 75 Rs. IDBI and some bank provide this charges free to their customer. Only ICICI bank provide withdrawal limit unlimited to their customer. Rest of the bank gives 25,000 to10, 00,000 Rs. limits for cash withdrawal. For demand draft charges customer has to pay from 25 to15, 000 Rs. in their respective bank while IDBI banks customer does not have to pay for demand draft charges. IDBI and some bank do not charge any amount for outstanding cheque collection charges and other bank charge 25 to 225 Rs. to their customer. Some bank charges 50 to 200 Rs. for statement charges while IDBI bank do not charge any amount to their customer for the same. IDBI bank does not charge any amount for cheque book charges while other banks charges 2 to 12,500 Rs. to the customer.

Most of the bank give 5 transactions free to the customer for cash withdrawal and balance enquiry at other bank ATM. After 5 transactions bank charges 18 to 20 Rs. while IDBI bank does not charge any amount for the same.

IDBI and other bank do not charge annual fee to their customer and some bank charge 50 to 100 Rs. Customer has to pay 53 to 850 Rs. for Cheque inward charges and for cheque outward charges 85 to 150 Rs. For IDBI banks customer cheque inward charges is 53 Rs. and 102 Rs. for cheque outward charges.

Q. 1

Do you have account in any bank?

Primary data Analysis

yes no

100 0

Here from this question we get to know that most of the respondents have bank accounts.

Q. 2

If yes then in which bank?

SBI Bankof baroda ICICI HDFC IDBI Axis Indusind

49 34 10 11 16 9 10

From above chart we get multiple answers for this question. Majority of customer have SBI and BOB account with 49% and 34%. After that with 16 % IDBI bank stand on 3 rank.

Q. 3

Which type of A/C do you have?

Current savings NRO NRE FD

21 100 0 0 0

Here we get multiple answers for this question. From this chart we can conclude that majority of customer have savings account in their respective bank. Very less respondents have current account.

Q. 4

Are you satisfy with the existence bank?

services yes service charges no facilities others

32 79 36 21 24 21

From this chart we can say that most of the respondents are satisfy with their existence bank compare to others and that is 79% and 21%.

Q. 5

If yes then which Purpose?

Here we get to know that 36% and 32% respondents are satisfy with service charges, and service towards their bank. 24% and 21% respondents are satisfy with facilities and other reason.

Q. 6

If no then which Purpose?

services service charges facilities others

6 15 11 7

From this chart most of the customer is not satisfy with their respective banks service schedule and that is 15% and 11% respondents are not happy with banks facility.

Q. 7 Are you aware about IDBI bank in Bardoli? yes no 91 9

Majority of respondents with 91% know about IDBI bank in bardoli. They are locality of this region and rest of the respondents do not know about this bank.

Q. 8 Are you aware about IDBI banks Customer yes Delight campaign? no

12 88

From this chart we can say that only 12%respondent know about IDBI banks Customer delight campaign and they are the customer of this bank. Rest of the people does not know about this campaign.

Q. 9 Are you aware about IDBI bank does not charge any charges on savings and current A/c? yes no 28 72

With 72% respondents know that IDBI bank does not charge any charges on current and savings account. 28% people are not aware about this information.

Q. 10

Are you aware about IDBI bank is owned by Government of India?

yes no yes no

49 51 16 84

From this chart we can conclude that there is very minor difference in this answer. People with 51% know that IDBI bank is owned by government and 49% peole do not know it.

Q. 11

Are you aware about IDBI bank offers zero balance charges?

Most of the respondents with 84% do not aware about IDBI banks zero balance charges. People with only 16% know about it.

Q.12 Which important criteria you consider while opening a account?

Services Facilities Service charges Interest rate others

42 48 72 25 12

Here from this question we can conclude that most of the respondent considers service charges as most important criteria while opening account in bank. In this question we get multiple answer of this question as respondents choose multiple answers for this question.

Q.13 Do you use your account daily?

Yes no

19 81

From this chart we get to know about 19% respondents use their account on daily basis as some of respondents concern with the business. Rest of the 81% respondents do not use their account daily.

Q.14 For which purpose do you use your account?



Personal Others

77 4

When we asked about for which purpose people use their account 77% respondents use their account for personal reason, 19 % people use their account for business purpose and rest of the 4% people use their account for other reasons.


Please tick as appropriate:

(A)Ease of transaction
Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory 31 17 20 14 18

Most of the respondent are extremely satisfy with the ease of transaction with the bank and do not respond of the question. Extremely dissatisfactory People are also no less in research.

(B) Process Clarity

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory 29 24 13 18 16

Process clarity of bank give extreme satisfaction to the respondents. There are also more presence of dissatisfactory and extremely dissatisfactory people from the whole sample size.

(C) Rate of Interest

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory 19 57 9 7 8

Rate of interest is the most crucial factor for every customer. Rate of interest give more satisfaction to the majority of the respondents.


Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory

17 37 13 21 13

From the above charts Documentation of bank give satisfaction to the maximum number of respondents. After this there is also high number of people dissatisfy with the documentation of the bank.

(E) Time duration

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory

24 41 12 9 14

From the above graph Time duration of the bank makes most of the respondents are fully satisfy with bank. Very few respondents dissatisfy with the banks time duration.

(F) knowledge of staff

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory 16 39 14 27 4

When we asked about the knowledge of staff Majority of the respondents is satisfy with knowledge and that is 39%. On the other side 27% people dissatisfy with knowledge of staff. Rest of the 16%, 14%and 4% people feel extremely satisfy, neutral, and extremely satisfy respectively.

(G) Prepayment Charges and processing charges

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory 21 48 4 18 9

(H) After sales

From the above chart we clearly see that most of the respondents satisfy & extremely satisfy with the repayment charges and processing charges and that is 48% and 21%. Rest of the 18%, 9%, 4% respondents feel dissatisfy, extremely dissatisfy & neutral respectively. services

Extremely Satisfactory Satisfactory Neutral Dissatisfactory Extremely dissatisfactory

27 34 2 25 12

From the above chart most of the respondents are satisfy and extremely satisfy with the banks after sales services. Very less people are neutral and extremely dissatisfy with the sales services.

Q.16 How will you rate the following factors associated while dealing with IDBI? (Rate on a scale of 1 to 5)

(A) Response of Employee

Very poor Poor Neutral Good Excellent 12 30 8 30 20

From the above graph we clearly see that similar group of people respond good and poor for the response of banks employee. That is 30% and 20% people response is excellent rest of the 12% and 8% people response very poor and neutral for the response of employee.

(B) Dealing in comfortable language

Very poor Poor Neutral Good Excellent 20 14 9 27 30

Most of the banks employees are excellent and good with the dealing with the language and that is 30 % and 27%. On the other hand after that with 14% are very poor in dealing with language with. From the hypothesis we get to know that language of staff member is not customer friendly.

(c) Location from house

Very poor Poor Neutral Good Excellent

14 11 30 24 21 Here in this graph very large number of peoples response is neutral for the banks location from their house. Similarly after that most peoples response is very poor. There is very less difference of peoples response in options like good, excellent and poor with the location of bank. From the hypothesis we get to know that location is not an important factor while dealing with IDBI bank.

(D) Drinking water

Very poor Poor Neutral Good Excellent 17 26 20 27 10

From this chart we clearly see that regarding the drinking water of bank is quit same and that is 27% and 26%. Peoples response is neutral with 20%. 17% and 10% people says that drinking water of bank is very poor and excellent.

(E) Parking

Very poor Poor Neutral Good Excellent

31 17 20 11 21

Majority of the respondents response is very poor with regards to the banks parking facility. On the other hand after that most of the people feel excellent for the banks parking facility.

(F) Seating arrangement

Very poor Poor Neutral Good Excellent 37 23 9 17 14

The seating arrangement of bank is very poor. People are not satisfy with the seating facility provide by the bank.

(G) May I help you

Very poor Poor Neutral Good Excellent

11 20 13 30 26

From this graph peoples response is quite positive with enquiry counter of bank. People with 30% and 26 % are satisfied with this service. Very less people do not satisfied with enquiry counter of their respective bank.

(H) Ease of locating

Very poor Poor Neutral Good Excellent 33 24 27 12 4

From this chart peoples response is very poor for ease of locating and for the neutral and poor peoples response quite similar and very less people feel that it is good in ease of locating.

Q.17 Are you aware about all service charges offered by bank?

Yes No

24 76

From above graph we can conclude that most of the respondents are not aware about the service charges offered by the bank and that is 76% . Rest of the 24% people is aware of all service charges offered by bank which show negative sign.

Q.18 Are you satisfy with all charges offered by bank?

Yes no

63 37

From this graph we can conclude that People with 63% are satisfy with banks service charges and rest of the 37% peoples response is negative.

Q.19 While transaction would you consider or compare other banks service charges?

Yes No

21 79


From above this graph we can conclude that most of the people with 79% says that they do not compare other banks services charges. Rest of the 21% people compare the other banks service charges while transaction.

Q. 20 For service charges, which bank will you consider?

Rank 1 2 3 4 5 6 7 8 Respondents 21 15 11 8 7 14 16 8

From this graph we can say that majority of the people give first rank to the SBI bank which is highest compare to other banks.

Rank 1 2 3 4 Respondents 11 9 17 22

5 6 7 8

13 8 9 11

Here we can say that most of the people say that IDBI bank is on 4 rank while dealing with service charges.

Rank 1 2 3 4 5 6 7 8 Respondents 5 8 4 13 15 11 21 23

From this chart we can conclude that HDFC bank is very poor in charging service charges compare to other bank. People with 21% and 23% give 7 and 8 rank to the bank.

(D) Indusind
Rank 1 2 3 4 5 6 7 8 Respondents 3 5 11 9 14 23 17 18

Here 23% people give 6 rank to the bank which is highest compare to other position. Bank charge high amount of money so very few people satisfy with this banks service charges.

Rank Respondents

1 2 3 4 5 6 7 8

3 6 13 9 19 24 27 9

From this chart we can conclude that ICICI charge high amount of money compare to other bank. So most of the people give poor rating to the bank.

(F) Axis
Rank 1 2 3 4 5 6 7 8 Respondents 4 8 11 17 24 12 17 7

Here most of the people give 5 rank to the bank as its charges is high compare to other bank. Very less people give positive response in the manner of banks charges.

(G) Bank Of Baroda

Rank 1 2 3 4 5 6 7 8

Respondents 13 18 9 14 7 15 10 14

Here we get quite mix response from respondents. Some people consider this bank is on 1 and 2 rank but also some people give low ranking to this bank.

(H) Others

Rank 1 2 3 4 5 6 7 8

Respondents 7 10 6 18 21 17 11 10

Here we can say that most of the people consider other bank is on 5,6 and 7 rank . very less people give positive response to the bank.

21 According to you which charges should be free of bank ?

Balance enquiry Cash withdrawal ATM others EFT DD AQB Others

9 12 27 17 7 6 12 10

From this chart we can say that most of the people say that ATM, cheque book charges should be free provide by their respective bank.

Q. 22 Overall ratings would you like to give bank

Best Better Good Poor

28 19 40 13

Here in this chart people give positive response to the bank in the manner of performance. 40% and 28% people feel that their banks performance is respectively good and best. Very less people give poor ratings to the bank as they are not satisfy with banks service and facility.

5.1 Testing of Hypothesis

Hypothesis: 1
H0: Location is an important factor while dealing with IDBI bank.

H1: Location is not an important factor while dealing with IDBI bank. Rate location from house you 1 14 2 11 3 30 4 24 5 21

Mean SD N Standard Error

Zcal Ztab
x z = n

3.27 1.30 100 0.13 3 2.07 1.96

Zcal = 2.16 and Ztab = 1.96 Therefore Zcal> Ztab

H0 is rejected

Location is not an important factor while dealing with IDBI bank.

Hypothesis: 2
H0: Enquiries are not handled properly. H1: Enquiries are handled properly.

Rate May I help

1 11

2 20

3 13

4 30

5 26

Mean SD N Standard Error

Zcal Ztab

3.4 1.36 100 0.14 3 2.95 1.96

x z = n
Zcal = 2.95 and Ztab = 1.96 Therefore Zcal> Ztab H0 is rejected

Enquiries are handled properly.

Hypothesis: 3
H0: Language of Staff members is Customer friendly. H1: Language of Staff members is not Customer friendly

Rate Dealing

1 in 20

2 14

3 9

4 27

5 30

comfortable language

Mean SD N Standard Error

Zcal Ztab

3.33 1.52 100 0.15 3 2.16 1.96

x z = n

Zcal = 2.16 and Ztab = 1.96 Therefore Zcal> Ztab

H0 is rejected

Language of staff member is not customer friendly.


From this report it is found that IDBI bank offers most of the services charges free to their customer in Bardoli region. From the survey we found that from the decided sample size all the respondents have bank account.

It has been observed that from the sample size majority of respondents have account

in SBI with 49% and Bank Of Baroda with 34 %. Both banks are public sector in India. IDBI bank is semi government banking sector which have 16% customer from the sample size.
Some of the customer has both current and savings account.

People with 79% are satisfy with their existence bank and rest of the people do not satisfy with bank. Majority of the respondent know about IDBI bank in bardoli and that is 91% and only 9% people do not aware about it. People with 88% do not aware about IDBI banks Customer delight campaign. Rest of the people aware about this campaign. Only 28% people know that IDBI bank does not charge any charges on savings and current A/C.
There is quite minor difference in result of this question. 49% people know that IDBI

bank is owned by government of India. Majority of the people do not know about IDBI bank offers zero balance charges and that is 84%.
All the customer give more preference to service charge while open a account in any

bank. Then after customer give priority to service charges, services and facilities of bank.
We found that people with 81% do not use their account on daily basis while

remaining 19% respondent use their account daily as they concern with their business.
From this report majority of people use their account for personal reason with 77%

and 19 %, 4% respondent uses their account for business and other purpose. Most of the respondents with 31% are extremely satisfy with the ease of transaction of bank. Very few respondent with14% are dissatisfied with ease of transaction. With regards to Process clarity of bank most of customers are extremely satisfies. Rate of Interest gives more satisfaction to the respondents. Documentation and time duration gives satisfaction to the customer. We found that majority of 39% people satisfy and 4% people dissatisfy with the knowledge of the staff which is very less.
Most of the people satisfy with the repayment charges and after sales services which

is very high and very few respondents give neutral response. We found that response of employee is both poor and good.

Most of the respondents give low ratings for language of staff members. While

dealing with hypothesis we get mean= 3.33, SD=1.52, n=100, Standard error= 0.15, =3, Zcal= 2.16, Ztab=1.96. So we can say that language of staff member is not customer friendly.
Most of the customer gives neutral response to location of bank from their home.

While calculating hypothesis we found mean= 3.27, SD=1.30, N=100, standard error=0.13, =3, Zcal=2.07, Ztab=1.96. The drinking water of bank is quite good and poor also. Parking facility, seating arrangement and ease of locating is very poor in view of majority of customer.
Enquiry counter of bank is good for most of the respondents. While dealing with

hypothesis we get mean=3.4, SD=1.36, n=100, standard error=0.14, =3, Zcal=2.95l, Ztab=1.96. so from this figure we can conclude that enquiries are handled properly. We found that 76% of respondent are not aware about banks service charges and remaining 24% respondent know about the banks service charges. There is vast difference in satisfaction of banks service charges. 63% satisfy and 37% respondent do not satisfy with banks service charges. We found that most of the customer with 79% do not consider other banks service schedule during transaction and remaining 21% of people consider for the same which is very less. Most of the customer believes that ATM and cash withdrawal charges should be free providing by bank. Majority of customer give positive response regarding banks overall ratings and very few respondent give poor responses to banks overall ratings.

Customer delight programme is required so that more people should attract towards advance product of IDBI bank.

As Government is the majority share holder in the shares of IDBI bank, which makes this bank more reliable than other private banks, this thing can be used in the favour of IDBI bank by making people aware about this fact and winning their faith. IDBI bank has potential a tapped market in BARDOLI region and hence has opportunities for growth. If there are any kind of hidden charges than that must disclose to customer before do any transaction. IDBI must take some steps so that customers can charge very less service charges. Phone verification by customer care that customer is satisfied with the banks schedule of charges of bank and take their fair suggestions. The products of IDBI bank have good credibility in the region compare to its Competitors. For the better service new offers would be require. IDBI customer care should more concern about the fastest settlement of customer problems. Before deducting or charging any monetary charge IDBI must consult with customer. It is the duty of the bank to disclose all the material facts regarding advance product, like interest charged, repayment period, other types of charges, etc. IDBI must take feedbacks of customers regarding features & services.

IDBI bank is aware of the importance of business and its strength in improving their bottom line. It is the quality of products, level of technology and speed of services provided which is going to be the deciding factor. It will have to differentiate from other banks offering similar products & very convenient service schedule to the customers. The

common consumer is the ultimate beneficiary in terms of quality and cost. From the survey of this report most of the customer delighted by IDBI banks convenient schedule of charges. IDBI bank do not charges unusual service charges for their customers compare to other public and private sector banks. The response of the respondent is positive and gives effective feedback. As more and more players competitor enter into market, IDBI needs to provide customer a choice of options at the lowest cost to choose from. With the barriers for Internet Banking diminishing new players will gain the market access and provide similar services to customers making the existing players to be ever vigilant and look out for choices. In this fierce war for higher market shares in market the only beneficiary is the customer. We can say that customer is the king for banks nowadays.

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Dear sir/madam, As you know we are a customer-centric bank, we are conducting a survey to understand customer preferences and their satisfaction level with the services provided by our bank. It would be really grateful if you could spare some time to fill up this questionnaire and oblige us with your valuable feedback.

Q. 1

Do you have account in any bank?

Yes Q. 2 If yes then in which bank? SBI Bank of Baroda ICICI HDFC Q. 3 Which type of A/C do you have? Current


IDBI Axis Indusind

NRO Savings FD NRE Q. 4 Are you satisfy with the existence bank? Yes Q. 5 If yes then which Purpose? No

Q. 6

If no then which Purpose?

Q. 7 Are you aware about IDBI bank in Bardoli? Yes If no then Address: IDBI bank, near Binita park apartment M.G. road, Bardoli. Q. 8 Are you aware about IDBI banks Customer Delight campaign? Yes No No

Q. 9 Are you aware about IDBI bank does not charge any charges on savings and current A/c? Yes No

Q. 10

Are you aware about IDBI bank is owned by Government of India? Yes No

Q. 11

Are you aware about IDBI bank offers zero balance charges? Yes No

Q. 12 What important criteria you consider while opening a account? ( ( ( ( ( ) ) ) ) ) Services Facilities Service charges Interest Rate Others

Q. 13 Do you use your account Daily ? Yes No

Q. 14 For which purpose do you use your account? Business Personal Other Q. 15 Please tick as appropriate:
Extremely satisfactory Ease of transaction Process clarity Rate of interest Documentation Time duration Knowledge of staff Prepayment charges and processing fees Satisfactory Neutral Dissatisfactory Extremely dissatisfactory

After sales service

Q. 16 How will you rate the following factors associated while dealing with IDBI?
(Rate on a scale of 1 to 5) Response of employees Dealing in comfortable language Location from house Parking Seating arrangement Inquiry counters

Drinking water

Ease of locating

Q. 17 Are you aware about all service charges offered by bank? Yes Q. 18 No

Are you satisfy with all charges offered by bank? Yes No

Q. 19

While transaction would you consider or compare other banks service Charges? Yes No

Q. 20

For service charges, which bank will you consider?

(Rank according to your preference) SBI HDFC IDBI Axis bank

Indusind Bank ICICI Q. 21

BOB Other

According to you which charges should be free of bank ? ( 1 ) Balance enquiry ( 2 ) cash withdrawal ( 3 ) ATM ( 4 ) Cheque book (5) EFT (6) DD (7) AQB (8) Others

Q. 22 Overall ratings would you like to give existence bank is Best

Better Good Poor Q. 23 Your suggestions for any improvement in banks service schedule. __________________________________________________________________ __________________________________________________________________ Thank you very much for giving valuable information and your valuable time to me.

Personal Details:
NAME: GENDER _________________________________________ MALE FEMALE ADDRESS: - _________________________________________

AGE: -