Research Project Report on

Reasons for Low Usage of Few Banking Products

December 21, 2009

In partial fulfillment of the requirements of the course "Research Methodology" of MBA (Full Time) 2009-2011

Executive Summary
The research was carried out on general Public to understand the basic reasons as to why some offbeat Financial Products like e-shop Card and Reverse Mortgage and a well known, useful Product like Student Loan are not doing very well. They are just not popular among the masses, and this definitely affects the performance of the concerned Banks. The Survey was carried out on office-goers, College Students., general Public availing Banking Services. The questionnaire was designed keeping in mind all of these target segments. It was divided into three subparts, one for each product. Whosoever knew any one Product was asked to fill out the relevant Section. The data collected was consolidated and laid out in a proper format, as per our Research guidelines. Various types of analysis methods were applied to the data, so as to establish the reasons. The reasons for an e-shop card not doing well have been identified as Low frequency of Shopping Online, lack of know-how amongst general Public, Security Concern of sharing details over the Internet, Username Password Botheration etc. Whereas reasons for people not availing Student Loan, range from the perception that only A grade Students can avail the Loan, to the belief that Repayment of a Student Loan is very difficult, or the Family Income does not support it. The Reverse Mortgage had a different target segment altogether, as it is designed for Senior Citizens only. Some of the reasons for its unpopularity include liability on the legal heir to repay the mortgage loan, perception that it is a Risky Product. We have also included some recommendations as a part of our conclusion.

Contents Introduction Management Dilemma Management Question Research Questions Methodology Sampling Population Instruments Data Collection Questionnaire Pilot Testing Code Book

Data Analysis (e-shop Card) Hypothesis Testing (e-shop Card)

Data Analysis ( Student Loan) Hypothesis Testing (Student Loan)

 Data Analysis ( Reverse Mortgage) Hypothesis Testing ( Reverse Mortgage) Recommendations

Introduction:
Today there are a lot of financial Products on offer by various banks. Some of them are very offbeat and useful. But for some or the other reason, they are not very popular amongst the masses. Through this Research, we propose to find out these very reasons, by conducting a survey and analysing it. The various Products we have chosen for our Research are:
1) E-Shop card: If one is worried about revealing credit card details on the

Internet, one can avail the services of an eShop Card, a virtual credit card on offer by Axis Bank. One registers itself with the Banks Credit Card details, specifying the amount one wants to shop with. A username and a password are generated every time one shops online, thus safeguarding your credit card details efficiently.
2) Student Loan: This loan product is available with most of the banks. It is

designed for Students pursuing Graduation, Post- Graduation, Professional & other courses in India and Abroad. Depending on the course location, that is whether in India, or in Abroad, the Loan Amount is decided. Eligibility Criteria, Repayment Period, Interest Rates differ from bank to bank.
3) Reverse Mortgage: This home loan product is not available with most of the

banks. It is designed for senior citizen and for people above 55 years of age. Monthly income is given by the bank to the user of this product. The monthly income is determined by the value of mortgaged property, generally a residential apartment or building. The user of this product is not required to pay for any interest till the expiry of the product contracted period or till the end of users life. Bank is liable to money only to the extent of mortgage property of the user. From the brief description above, it is clear they are offbeat but useful at the same time. But People are not aware of them, or have heard about them, but never used them, because of certain myths or lack of knowledge about availing them. Through this Research, we intend to find the various factors contributing to their unpopularity. For this purpose, we carried out a survey of around 122 people. The filter was that they should be at least aware about them. After data collection, proper analysis of the data was carried out, along with hypothesis testing. The results have been documented below.

Management Dilemma: Various Financial Products, in particular, e-shop Card, Student

Loan, Reverse Mortgage are not very popular amongst the general Public.

Management Question: What are the possible reasons for these financial Products not
doing well?

Research Questions:
Is there a strong know-how about these banking products? Is the Username-Password Process considered interference in the usage of e-shop Card? Is the perception of Repayment of Student Loan is difficult a reason for people not availing Student Loans? Is the factor liability on a legal heir to repay the Reverse Mortgage Loan an inhibiting factor in its usage? Is the perception that Jewellery is safe in a locker a deterrent in availing Jewellery Insurance?

Methodology
The sampling plan includes, identifying the relevant population, determining the sample size, the population framework and the method of sampling, the instrument used, the collection and analysis of data including the questionnaire have been explained in brief in the following sub-sections.

Sampling Plan
Relevant Population: The objective of this research is to find out the reasons for lack of acceptability and low usage of banking products like eShop Card, Student loans and Reverse Mortgage. This would be measured in terms of its acceptance among the current users of these product, as well as non users having the knowledge about the product. The relevant population for the study will thus be the user population and non user population having the knowledge about the product, using the daily banking services. Relevant Population for the product reverse mortgage is a user or nonuser having knowledge about the product age above 55 years. Population Framework: Relevant data with respect to the user of these banking products is readily available with banks, but because of privacy policy, banks are reluctant to share this data with outsiders. Thus population framework for user and nonuser of these banking products is not readily

available. We would rely on our sampling techniques to ensure that a representative sample is used for the purpose of study. Sampling Method: We propose to use Convenience Sampling for data collection for all the three product. Additionally Snowball sampling would be used for Reverse Mortgage, as it is difficult to find users and nonusers having the knowledge about the product. Sampling Size: The proposed sample size for eshop is 63, for students loan is 81 and for reverse mortgage is 28. We have not used quota sampling to select user and nonuser of products. Number of samples is different for all the three product as this was done on the basis of availability of sample outside bank outlets.

Instruments
The research study is an experimental study with the goal to find out the reason for non acceptability and low usage of banking product (eshop, Student loan and Reverse MortgageHome loan product). The research will be conducted by recording the responses of sample elements via a questionnaire. The questionnaire will utilise multiple choice to measure the responses of the sample elements. We seek to understand and interpret the responses of the sample elements with regard to enough know-how about the nuances for e-shop product, the frequency of online shopping and whether the bank provides the service or not. With regards to student loan by knowing the family income, the paper work involved in getting the loan, studying the perception that A Grade student getting the loan and about the ease of repayment of loan we want to understand and interpret the reasons for low usage of this product. With regard to reverse mortgage we want to understand and interpret from, current monthly income of target population of 55 and above, by knowing if this product satisfy sample elements financial need and to know if this product is better than other fixed income investment, about the low usage and perception of target population.

Data Collection
The survey is proposed to be conducted though one to one (convenient sampling) and telephonic interviews (Snowball Sampling). The elements will be selected from outside the bank branches and ATMs. Elements will also be selected by reference given by the sample element selected outside the bank and ATMs (Snowball Sampling). The Questionnaire: The questionnaire had a filtering question, so as to know whether the respondent was even aware of the Products or not. If unaware, the further survey was not carried out on him. If aware, the respondent was asked to fill out the responses further. We had also divided the Questionnaire into three sections, one for each product.

The questionnaire comprised multiple choice questions to facilitate quick and effortless

responses as also to easy data analysis. Attached Questionnaire :

Questionnaire.doc

Pilot Testing:
A pilot test was conducted to determine whether respondents are comfortable with the questions being posed and to collect sample responses to make sure we are getting appropriate responses. This pilot testing was conducted on 15 people for e-shop and students loan and on 5 people for Reverse Mortgage and the results were satisfactory. The questionnaire was put forward with minor modifications to the entire sample.

Codebook
Attached :
CodeBook.xls

Data Analysis (e-shop card)

After doing a survey of 122 respondents, we obtained responses from 63 respondents as were aware about the concept of e-shop card.

Out of 63 respondents, the ratio for users and non users was subdivided as : -

Usage of e-shop Card

6.0

Usage
Yes No

Pies showcounts

57.0

The major reasons for such high proportion non-users for this banking service as obtained by our questionnaire are : -

a) Lack of Know-How about the nuances of the e-shop card

Know H about e-shop Card ow

10.0

K now_How
Agree Neutral

S trongly Agree

24.0

5.0 1.0

Disagree S trongly Disagree

Pies showcounts

23.0

The above distribution shows that out of the respondents who were atleast aware about the E shop card, 74.60% had no knowledge about the working of the E shop Card.
b) The concept of remembering the Username-Password bothered the sample.

Usernam e -Password Both e ration

8.0

Un am e _P wo rd_P roce s s_B oth e rs

Strongly Agre e Agre e Neutra l Disagre e Strongly Disagre e

6.0

23.0

2.0

P ies show counts

24 .0

The above distribution shows that out of the respondents who were atleast aware about the e shop card, 74.60% felt that remembering Username-Password was a botheration. c) The proportion of sample respondents who shopped online frequently was low.
O nline Sh p ingF eq enc op r u y

1 0.0

S hop O _ nline
F u tl req en y R arely N ever

2 2.0

P sho cou ts ies w n

3 1.0

The above distribution shows that out of the respondents who were atleast aware about the E shop card, 49.20% rarely did online shopping and 34.29% never did online shopping. d) A large proportion of the sample was concerned about putting their Personal Information online.

Concern ab Online P out ersonal Information

7.0

Security_Concern
S trongly Agree Agree 18.0 Neutral Disagree S trongly Disagree

7.0

2.0

Pies showcounts

29.0

The above distribution shows that out of the respondents who were atleast aware about the e shop card, 74.60% had a major concern regarding putting personal information online. e) The bank does not provide the service
Bank provides e-shop card service

Bank_Provides
Yes 17.0 23.0 No Dont Know

Pies show counts

23.0

The above distribution shows that out of the respondents who were atleast aware about the e shop card, 36.5% respondents banks did not provide this service and 36.5% did not know whether their bank provided this service or not.

Hypothesis Testing:
The multiple regression equation is: Y = 1*X1+ 2*X2+ 3*X3+ 4*X4+ 5*X5 Where, Y is the usage of e-shop card and

X1 is the Shop_Online X2 is Know How X3 is bank providing e-shop card service X4 is Security concern regarding putting personal information online X5 is Username-Password botheration The (i) shows the relative contribution of the independent variable to the explanatory power of the equation:
1) Null Hypothesis: There is no relationship between usage of a Eshop card and frequency

of Shopping Online, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Eshop card and frequency of Shopping Online, meaning (i) 0.

Standardized Coefficients Shop_Online Beta .562 Std. Error .106

df Beta 1

F Std. Error 28.220

Sig. Beta .000

Coefficients

Dependent Variable: Usage of e-shop Card ; Independent Variable: Shop_Online

The F value is 28.220; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there is atleast one significant defining variable of Usage of Eshop Card.
Model Summary

Multiple R Dependent Variable: Usage

R Square .562 Independent Variable : Shop_Online

Adjusted R Square .316 .305

R Square Value: 0.316: 31.6 % of variation in the Usage is explained by the Frequency of Shopping Online. 2) Null Hypothesis: There is no relationship between usage of a Eshop card and Know How about e-shop card, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Eshop card and Know How about e-shop card, meaning (i) 0.

Standardized Coefficients Shop_Online Know_How Beta .374 .464 Std. Error .100 .100

df Beta 1 1

F Std. Error 13.942 21.412

Sig. Beta .000 .000

Coefficients

Dependent Variable: Usage of e-shop Card ; Independent Variable: Shop_Online, Know_How

The F value is 21.412; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there are atleast two significant defining variable of Usage of Eshop Card.
Model Summary

Multiple R Dependent Variable: Usage

R Square .704 .496 Independent Variable: Shop_Online, Know_How

Adjusted R Square .479

R Square Value: .496: 49.6 % of variation in the Usage is explained by the Frequency of Shopping Online and the knowledge about the e-shop card.
3) Null Hypothesis: There is no relationship between usage of a Eshop card and bank

providing the service of e-shop card, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Eshop card and bank providing the service of e-shop card, meaning (i) 0.
Coefficients Standardized Coefficients Beta Shop_Online Know_How Bank_Provides df F Sig.

Std. Error Beta Std. Error Beta .321 .101 1 10.136 .002 .421 .100 1 17.873 .000 .205 .097 1 4.480 .039 Dependent Variable: Usage of e-shop Card ; Independent Variable: Shop_Online, Know_How, Bank_Provides_Service

The F value is 4.480; because p = .039, the F value is significant at = .05. The null hypothesis is rejected, and there are atleast three significant defining variable of Usage of Eshop Card.

Model Summary

R Square Adjusted R Square .729 .532 Dependent Variable: Usage Independent Variable: Shop_Online, Know_How, Bank_Provides

Multiple R

.508

R Square Value: .532: 53.2 % of variation in the Usage is explained by the Frequency of Shopping Online and the knowledge about the e-shop card and whether the bank provides the service or not.
4) Null Hypothesis: There is no relationship between usage of a Eshop card and security

concern of online personal information, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Eshop card and security concern of online personal information, meaning (i) 0.
Coefficients Standardized Coefficients Beta Shop_Online Know_How Bank_Provides Security_Concern df F Sig.

Std. Error Beta Std. Error Beta .217 .092 1 5.554 .022 .417 .088 1 22.711 .000 .189 .085 1 4.877 .031 -.353 .083 1 18.205 .000 Dependent Variable: Usage of e-shop Card ; Independent Variable: Shop_Online, Know_How, Bank_Provides_Service, Security_Concern

The F value is 18.205; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there are atleast four significant defining variable of Usage of Eshop Card.
Model Summary

R Square Adjusted R Square .802 .644 Dependent Variable: Usage Independent Variable: Shop_Online, Know_How, Bank_Provides, Security_Concern

Multiple R

.619

R Square Value: .644: 64.4 % of variation in the Usage is explained by the Frequency of Shopping Online, the knowledge about the e-shop card, whether the bank provides the service or not and the security concern about the online personal information.
5) Null Hypothesis: There is no relationship between usage of a Eshop card and botheration

of remembering Username-Password, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Eshop card and botheration of remembering Username-Password, meaning (i) 0.
Coefficients Standardized Coefficients df F Sig.

Beta Shop_Online Know_How Bank_Provides Security_Concern Uname_Pword_Process_Bo thers .160 .390 .167 -.271 -.317

Std. Error .082 .078 .076 .076 .076

Beta 1 1 1 1 1

Std. Error 3.762 25.192 4.858 12.831 17.203

Beta .057 .000 .032 .001 .000

Dependent Variable: Usage of e-shop Card ; Independent Variable: Shop_Online, Know_How, Bank_Provides_Service, Security_Concern, Uname_Pword_process_Bothers

The F value is 17.203; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there are atleast five significant defining variable of Usage of Eshop Card.
Model Summary

Multiple R .852

R Square .726

Adjusted R Square .702

Dependent Variable: Usage Predictors: Shop_Online Know_How Bank_Provides Security_Concern Uname_Pword_Process_Bothers

R Square Value: .726: 72.6 % of variation in the Usage is explained by the Frequency of Shopping Online, the knowledge about the e-shop card, whether the bank provides the service or not, the security concern about the online personal information and the UsernamePassword process botheration.

Conclusion:
The Multiple regression equation for usage of e-shop card becomes : Y = (0.160)X1 + (0.390)X2 + (0.167)X3 (0.271)X4 (0.317)X5 Where, Y is the usage of e-shop card and X1 is the Shop_Online X2 is Know How about nuances of e-shop card X3 is bank providing e-shop card service X4 is Security concern regarding putting personal information online X5 is Username-Password botheration The above equation implies that: For 1 unit change in shopping online variable, the usage changes by 0.160

For 1 unit change in Know how variable, the usage changes by 0.390 For 1 unit change in bank providing service variable, the usage changes by 0.167 For 1 unit change in security concern variable, the usage changes by 0.271 For 1 unit change in Username-Password Botheration variable, the usage changes by 0.317

Note Here the regression coefficients () are standardized regression coefficients i.e. the Y intercept is zero. Thus with introduction of each new independent variable in multiple regression equation the values kept on reducing.

Correlations ZeroOrder .562 .616 .449 -.510 -.577 Partial .249 .554 .280 -.429 -.481 Part .134 .348 .153 -.248 -.287

Importance

Tolerance After Transformation .707 .795 .838 .838 .824 Before Transformation .707 .795 .838 .838 .824

Shop_Online Know_How Bank_Provides Security_Concer n Uname_Pword_ Process_Bothers

.124 .331 .103 .190 .252

Dependent Variable: Usage

The above table shows that: Know How about the nuances of e-shop card with Zero order correlation value of 0.616 and Importance value of 0.331 is the most dominant factor in determining the usage of e-shop card. Thus we can conclude that lack of knowledge about e-shop card is the major reason for its less popularity in masses.

Username Password Process Botheration with Zero order correlation value of -0.577 and Importance value of 0.252 is the second most dominant factor in determining the usage of e-shop card. The negative value implies the usage is indirectly proportional to the username password process. Thus we can conclude that remembering username password is the second major reason for its less popularity in masses.

Shopping Online frequency with Zero order correlation value of 0.562 and Importance value of 0.124 is the third most dominant factor in determining the usage of e-shop card. Thus we can conclude that remembering username password is the third major reason for its less popularity in masses.

Security Concern with Zero order correlation value of -0.510 and Importance value of 0.190 is the fourth most dominant factor in determining the usage of e-shop card. The negative value implies the usage is indirectly proportional to the security concern. Thus we can conclude that security concern is the fourth major reason for its less popularity in masses.

Bank Providing e-shop service with Zero order correlation value of 0.449 and Importance value of 0.153 is the fifth most dominant factor in determining the usage of e-shop card. Thus we can conclude that bank not providing the e-shop card service is the fifth major reason for its less popularity in masses.

Data Analysis (Student Loan)

After doing a survey of 122 respondents, we obtained responses from 81 respondents who were aware about the concept of Student Loan.

Out of 81 respondents, the ratio of people who had availed it, to people who had not availed it was around 1.189.

Aa v iledStu en L a d t on

Ua e sg
N o

Ys e

P s o c u ts ies h w o n
3 .0 7 4 .0 4

The Major reasons for it not being very popular, as found through our survey: 1)
Rpy e to aS u e t La e a mn f t dn o n

Rp y e t e a mn
Vr Es ey a y 1. 90 2. 50 Fi l Es ar y ay Fi l Hr ar y a d Vr Hr e y ad

Pe s o c u ts i s h wo n

1. 60

2. 10

The above distribution shows that around 56% respondents feel that repaying a Student Loan is fairly hard or very hard. 1)

A a o T x B efits o Stu en L n w re f a en n d t oa

T ax_B enefits
Y es N o

P showcou ies nts

3 8.0 4 3.0

The above distribution shows that awareness on Tax Benefits is pretty much low. 2)
O 'AGa e' Stu en ca av il Stu ent L an nly rd d ts n a d o

A r e_Students G ad
Y es N o

Pies showcou nts

3 3.0

4 8.0

The above distribution shows that a lot of respondents (around 60%) feel that only Agrade Students can avail the Student Loan.

3)

P er w k is a b ap or other ation

P er_W ap ork_Bothers
Y es N o 2 7.0

Pies showcou nts

5 4.0

The above distribution shows that over 66 % respondents, irrespective of the fact whether they have availed Student Loan or not, feel that Paper Work is too much in Student Loan.
4)

Future Plans for Higher Education

Future_Pl ans_For_Hi gher_Educati on

Yes No 20.0

Pies show counts

61.0

Around 75% respondents have no future plans for Higher Education, meaning they will most probably , not avail the Student Loan.

5)

Family Income
6.0

Family_Income

Below Rs.1 lac p.a Rs.1 lac p.a to Rs. 2 lac p.a Rs. 2 lac p.a to Rs 3 lac p.a Rs. 3 lac p.a to Rs. 4 lac p.a Rs. 5 lac p.a and above

26.0

16.0

Pies show counts

16.0 17.0

The above distribution shows that respondents in the higher income group dont generally go for Student Loans.

HYPOTHESIS TESTING:
The multiple regression equation is: Y = 1*X1+ 2*X2+ 3*X3+ 4*X4+ 5*X5 Where, Y is the Usage of Student Loan, i.e. Availing Student Loan and X1 is the Repayment of a Student Loan X2 is Awareness on Tax Benefits X3 is the belief that only A Grade Students can avail the Student Loan X4 is the Paper Work Botheration X5 is the Future Plans for Higher Education X5 is Family Income The (i) shows the relative contribution of the independent variable to the explanatory power of the equation:

The zero-order correlation: measures the association between the independent variables and the dependent variable. Larger correlations correspond to a more important variable.
1) Null Hypothesis: There is no relationship between Availing a Student Loan and

repayment of a student loan, meaning (i) = 0. Alternate Hypothesis: There is a relationship between Availing a Student Loan and repayment of a student loan, meaning (i) 0.
Coefficients Standardized Coefficients Beta Repayment Dependent Variable: Usage .729 Std. Error .077 df Beta 1 F Std. Error 89.679 Sig. Beta .000

Here of .729 shows that 1 unit change in Repayment of a Student Loan would lead to 0.729 units change in avaling of the Student Loan.. The F value is 86.679; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there is at least one significant defining variable of Usage of Student Loan.
Model Summary Multiple R .729 R Square .532 Adjusted R Square .526

R Square Value: .532: 53.2 % of variation in the Usage is explained by the factor Repayment of Student Loan.
2) Null Hypothesis: There is no relationship between usage of a Student Loan and Tax

Benefits available on a Student Loan, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Student Loan and Tax Benefits available on a Student Loan, meaning (i) = 0.
Standardized Coefficients Repayment Tax_Benefits Beta .289 .626 Std. Error .083 .083 df Beta 1 1 F Std. Error 12.174 57.144 Sig. Beta .001 .000

The F value is 57.144; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there are at least two significant defining variable of Usage of Student Loan.
Model Summary

Multiple R .854

R Square .730

Adjusted R Square .723

R Square Value: .730: 73 % of variation in the Usage is explained by the Repayment Factor and Awareness of Tax Benefts.
3) Null Hypothesis: There is no relationship between usage of a Student Loan and the belief

that only AGrade Students can avail a Student Loan, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Student Loan and the belief that only AGrade Students can avail a Student Loan, meaning (i) = 0.
Coefficients Standardized Coefficients Beta Repayment Tax_Benefits AGrade_Students .268 .488 -.313 Std. Error .071 .075 .058 df Beta 1 1 1 F Std. Error 14.249 41.899 29.334 Sig. Beta .000 .000 .000

The F value is 29,334 because p = .039, the F value is significant at = .05. The null hypothesis is rejected, and there are atleast three significant defining variable of Usage of Student Loan.
Model Summary Multiple R .897 R Square .804 Adjusted R Square .797

R Square Value: .804: 80.4 % of variation in the Usage is explained by these three variables.
4) Null Hypothesis: There is no relationship between usage of a Student Loan and Paper

work botheration, meaning (i) = 0. Alternate Hypothesis: There is no relationship between usage of a Student Loan and Paper work botheration, meaning (i) = 0.
Coefficients Standardized Coefficients Beta Repayment Tax_Benefits AGrade_Students Paper_Work_Bothers .238 .467 -.325 -.193 Std. Error .065 .069 .053 .047 df Beta 1 1 1 1 F Std. Error 13.292 45.917 37.858 16.727 Sig. Beta .000 .000 .000 .000

The F value is 16.727 because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there are at least four significant defining variables of Usage of Student Loan.

Model Summary Multiple R .916 R Square .840 Adjusted R Square .831

R Square Value: .840: 80 % of variation in the Usage is explained by these four variables.
5) Null Hypothesis: There is no relationship between usage of a Student Loan and Future

Plans of Higher Education, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Student Loan and Future Plans of Higher Education, meaning (i) = 0.
Coefficients Standardized Coefficients Beta Repayment Tax_Benefits AGrade_Students Paper_Work_Bothers Future_Plans_For_Higher_Edu cation Dependent Variable: Usage .222 .423 -.311 -.192 -.138 Std. Error .063 .068 .051 .045 .050 df Beta 1 1 1 1 1 F Std. Error 12.523 38.671 37.358 17.923 7.655 Sig. Beta .001 .000 .000 .000 .007

The F value is 7.655 because p = .007, the F value is significant at = .05. The null hypothesis is rejected, and there are at least five significant defining variables of Usage of Student Loan.
Model Summary

Multiple R .924

R Square .854

Adjusted R Square .845

R Square Value: .854: 85.4 % of variation in the Usage is explained by these five variables.
6) Null Hypothesis: There is no relationship between usage of a Student Loan and Family

Income, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Student Loan and Family Income, meaning (i) = 0.
Coefficients Standardized Coefficients df F Sig.

Beta Repayment Tax_Benefits AGrade_Students Paper_Work_Bothers Future_Plans_For_Higher_Educa tion Family_Income .195 .393 -.312 -.194 -.150 .106

Std. Error .062 .068 .050 .044 .049 .048

Beta 1 1 1 1 1 1

Std. Error 9.831 33.712 39.612 19.316 9.360 4.878

Beta .002 .000 .000 .000 .003 .030

The F value is 4.878 because p = .030, the F value is significant at = .05. The null hypothesis is rejected, and there are at least six significant defining variables of Usage of Student Loan.
Model Summary

Multiple R .929

R Square .863

Adjusted R Square .852

R Square Value: .863: 86.3% of variation in the Usage is explained by these six variables.

Conclusion:
The Multiple regression equation for usage of student loan becomes : Y = (0.195)X1 + (0.393)X2 - (0.312)X3 (0.194)X4 (0.150)X5 + (0.106)X6 Where, Y is the usage of student loan and X1 is the Repayment of student loan X2 is Tax benefits of student loan X3 is mis-belief that only A grade students get the student loan X4 is Paperwork botheration X5 is Future plans for higher studies X6 is the Family Income The above equation implies that: For 1 unit change in Repayment of student loan variable, the usage changes by 0.195 For 1 unit change in Tax benefits variable, the usage changes by 0.393

For 1 unit change in Belief that only A grade students get the student loan variable, the usage changes by 0.312 For 1 unit change in Paperwork botheration variable, the usage changes by 0.194 For 1 unit change in Future plans for higher studies variable, the usage changes by 0.150 For 1 unit change in Family income variable, the usage changes by 0.106

Note Here the regression coefficients () are standardized regression coefficients i.e. the Y intercept is zero. Thus with introduction of each new independent variable in multiple regression equation the values kept on reducing.

Correlations ZeroOrder .729 .829 -.652 -.350 -.525 .428 Partial .342 .559 -.590 -.455 -.335 .249 Part .135 .249 -.270 -.189 -.131 .095

Importance

Tolerance After Transformation .475 .403 .750 .948 .772 .803 Before Transformation .475 .403 .750 .948 .772 .803

Repayment Tax_Benefits AGrade_Student s Paper_Work_Bo thers Future_Plans_Fo r_Higher_Educa tion Family_Income

.165 .377 .236 .079 .091 .052

Dependent Variable: Usage

The above table shows that: Tax Benefits with Zero order correlation value of 0.829 and Importance value of 0.377 is the most dominant factor in determining the usage of student loan. Thus we can conclude that lack of knowledge about tax benefits from student loan is the major reason for its less popularity in masses. Repayment of student loan with Zero order correlation value of 0.729 and Importance value of 0.165 is the second most dominant factor in determining the usage of student loan. Thus we can conclude that repayment factor of the loan is the second major reason for its less popularity in masses. Belief that only A-Grade students get the loan with Zero order correlation value of -0.652 and Importance value of 0.236 is the third most dominant factor in determining

the usage of student loan. The negative value implies the usage is indirectly proportional to the Belief that only A-Grade students get the loan. Thus we can conclude that Belief that only A-Grade students get the loan is the third major reason for its less popularity in masses. Future plans for higher education with Zero order correlation value of -0.525 and Importance value of 0.091 is the fourth most dominant factor in determining the usage of student loan. Thus we can conclude that Future plans for higher education is the fourth major reason for its less popularity in masses. Family Income with Zero order correlation value of 0.428 and Importance value of 0.052 is the fifth most dominant factor in determining the usage of student loan. Thus we can conclude that lower family income is the fifth major reason for student loans less popularity in masses. Paper work botheration with Zero order correlation value of -0.351 and Importance value of 0.079 is the sixth most dominant factor in determining the usage of student loan. The negative value implies that higher the amount of paper work involved, lower the usage of student loan among masses. Thus we can conclude that paper work botheration is the sixth major reason for student loans less popularity in masses.

Data Analysis (Reverse Mortgage)

After doing a survey of 96 respondents, we obtained responses from 28 respondents as were aware about the concept of Reverse Mortgage.

Out of 28 respondents, the ratio for users and non users was subdivided as: -

UA E F E ES MR A A E S G O RVR E O T GG

UA E SG
YS E N O 9 .0

Pe s o c u ts i s h wo n

1. 90

The major reasons for such high proportion users for this banking service:

a) It is difficult to find a sample element not using the product and having the knowledge about this home loan product.

CUR NT MONTHL INCOM FROM PENSION AND OTHE FIXED INCOMEINV RE Y E R ESTME NT
1.0

2.0

CURRE INCOME NT
< 5000 5000 - 10000 10000 - 15000 15000 - 25000 25000 - 35000

6.0

Pies showcounts

14.0 5.0

1) a) Majority of the current user and non-user of this home loan product is in the range of 5000 10000 Rs per month. b) This provides with an insight that low income groups prefer to avail this services.

2)
DO Y UTH KTH P OD C W LM E Y U F NA CI LN E S? O IN IS R U T IL E T O R I N A E D

PR U M E S Y R N E OD CT E T OU ED
S O L A RE TR NG Y G E A RE G E N TA EU R L

9 .0

9 .0

Pies showcou nts

1 0.0

a) Out of 28 respondents, 9 Strongly Agrees and 10 Agrees to it that reverse mortgage is a source of monthly income.

3)

D Y UT I KIN E E R T C A G DO R V R M R G G A EHG ? O O HN T R ST A E H R E N E E SE O T A E R I H

2 .0 7 .0

I T R STR T A EH G NE E AE R I H
SR N L A RE T O GY G E A RE GE N UR L E TA D A RE IS G E

Pies showcou nts

1 2.0

7 .0

a) Majority of the respondents are of the view that Interest rate charged on this home loan product is high. b) Currently this product charges 10.50% per year, compounded monthly. c) The interest on this product keep on accumulating till the end of product life and hence user are required to pay interest on interest, which at the end accumulate to a big amount.

4)

D O Y O U T H IN K T H AT R EV ER S E M O R T G A G E P RO D UC T IS B ET T E R T H A N O T H ER F IXE D IN C O M E IN VE S T M EN T S W H IC H G IVE S S T AB LE

2. 0

3.0

B ETTER TH EN O TH ER IN V ES TM EN ET
A G R EE N E U TR A L D I SA G R E E ST R O N G LY D I SA G R E E

P ie s s h o w c o un t s
9. 0

14 .0

a) Majority of the respondents have disagreed or strongly disagreed to this statement. b) This gives the perception of the sample elements about the nature of the product as compared to other fixed income investments.

5)

DO YOU THINK REVERS E MORTGAGE LOAN WO ULD BE A BURDEN FO R YOU OR FO R YOUR LEGAL HEIR?

5.0

4.0

REPAYMENT BURDEN
STRONGLY AGREE AGREE NEUTRAL

Pies show count s

19.0

a) Majority of the sample elements agree to this statement. b) One of the prime reasons for this is that, repayment to the bank is done by the estate mortgaged by the user of this product or repayment can be done by the legal heir. As there is no interest charged on monthly or yearly basis, the user generally have a burden of huge interest payment by them or their legal heir 6)

D O Y O U T H IN K T H A T F A IL T O P L AN F O R O U R F IN A N C IA L N E ED S IN A D VA N C E LED U S T O A P RO D UC T L IK E R EV ER S

3.0 5.0

FA IL TO P L A N L ET Y O U TO TH I S P R O D U C T
ST R O N G L Y A G R E E A G R EE N E U TR A L D I SA G R E E

3.0

P ie s s h o w c o un t s

17 .0

a) Here majority of the sample elements agree that fail to plan for our financial needs in advance led us to a product like reverse mortgage.

Hypothesis Testing:
The zero-order correlation measures the association between the independent variables and the dependent variable. Larger correlations correspond to more important variable. The multiple regression equation is: Y = 1*X1+ 2*X2+ 3*X3+ 4*X4+ 5*X5 Where, Y is the usage of Reverse Mortgage and X1 is The current monthly income from pension or other fixed income investment. X2 is Product meets your financial need. X3 is Reverse Mortgage is a risky product. X4 is Interest rate are high on this product. X5 is Better then other fixed income investment. X6 is Repayment Burden. X7 is Fail to plan led us to this product. The (i) shows the relative contribution of the independent variable to the explanatory power of the equation:
1) Null Hypothesis: There is no relationship between usage of a Reverse Mortgage and

monthly income from pension fund and other fixed income investment, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Reverse Mortgage and monthly income from pension fund and other fixed income investment, meaning (i) 0.
Coefficients Standardized Coefficients CURRENT INCOME df F Sig.

Beta Std. Error Beta Std. Error Beta .851 .103 1 68.323 .000 Dependent Variable: USAGE and Independent Variable is current monthly income from pension fund and other fixed income investment.

The F value is 68.323; because p = .000, the F value is significant at = .05. The null hypothesis is rejected, and there is atleast one significant defining variable of Usage of Reverse Mortgage

Model Summary

Multiple R .851 Dependent Variable: USAGE Predictors: CURRENT INCOME

R Square .724

Adjusted R Square .714

R Square Value: 0.724: 72.4 % of variation in the Usage of reverse mortgage is explained by the current monthly income from pension fund and other fixed income investment.
2) Null Hypothesis: There is no relationship between usage of a Reverse Mortgage and

Interest rate are high, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Reverse Mortgage and interest rate are high, meaning (i) 0.
Coefficients Standardized Coefficients Beta INTEREST RATE ARE HIGH -.338 Std. Error .185 df Beta 1 F Std. Error 3.364 Sig. Beta .078

Dependent Variable: USAGE and independent variable: Interest rate are high

The F value is 3.364; because p = .078, the F value is significant at = .05. The null hypothesis is rejected, and high interest rate is a significant defining variable of Usage of Reverse Mortgage.
Model Summary

R Square .338 .115 Dependent Variable: USAGE Predictors: INTEREST RATE ARE HIGH

Multiple R

Adjusted R Square .081

R Square Value: 0.115: 11.50 % of variation in the Usage of reverse mortgage is explained by the current monthly income from pension fund and other fixed income investment.
3) Null Hypothesis: There is no relationship between usage of a Reverse Mortgage and

Interest rate are high, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Reverse Mortgage and interest rate are high, meaning (i) 0.
Coefficients Standardized Coefficients Beta Std. Error df Beta F Std. Error Sig. Beta

FAIL TO PLAN LET YOU TO THIS PRODUCT

-.118

.195

.367

.550

The F value is 0.367; because p = .550, the F value is significant at = .05. The null hypothesis is rejected, and fail to plan our financial needs in advance led us to this product is a significant defining variable of Usage of Reverse Mortgage.
Model Summary

Multiple R

R Square .014

Adjusted R Square -.024

.118 Dependent Variable: USAGE Predictors: FAIL TO PLAN LET YOU TO THIS PRODUCT

R Square Value: 0.014: 1.40 % of variation in the Usage of reverse mortgage is explained by the current monthly income from pension fund and other fixed income investment.
4) Null Hypothesis: There is no relationship between usage of a Reverse Mortgage and

current income and product meets your financial needs, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Reverse Mortgage and current income and product meets your financial needs, meaning (i) 0.
Coefficients Standardized Coefficients Beta CURRENT INCOME PRODUCT MEETS YOUR NEED .488 .513 Std. Error .107 .107 df Beta 1 1 F Std. Error 20.678 22.808 Sig. Beta .000 .000

Dependent Variable: USAGE Independent variable: current income and product meet your financial need.

The F value for current income is 20.678; because p = .000, F value for product meets your financial needs is 22.808; because p = .000 the F value is significant at = .05. The null hypothesis is rejected, and current income and product meets your financial need is a significant defining variable of Usage of Reverse Mortgage.
Model Summary

Multiple R .925

R Square .856

Adjusted R Square .844

Dependent Variable: USAGE Predictors: CURRENT INCOME PRODUCT MEETS YOUR NEED

R Square Value: 0.856: 85.60 % of variation in the Usage of reverse mortgage is explained by the current monthly income from pension fund and other fixed income investment and product meet your financial needs.

5) Null Hypothesis: There is no relationship between usage of a Reverse Mortgage and

all the variable under study, meaning (i) = 0. Alternate Hypothesis: There is a relationship between usage of a Reverse Mortgage and all the variable under study, meaning (i) 0.
Coefficients Standardized Coefficients Beta CURRENT INCOME PRODUCT MEETS YOUR NEED RISKY PRODUCT INTEREST RATE ARE HIGH BETTER THEN OTHER INVESTMENET REPAYMENT BURDEN FAIL TO PLAN LET YOU TO THIS PRODUCT .492 .506 .030 .058 -.057 .006 -.119 Std. Error .128 .123 .100 .099 .087 .089 .101 df Beta 1 1 1 1 1 1 1 F Std. Error 14.743 16.986 .089 .347 .435 .004 1.371 Sig. Beta .001 .001 .769 .563 .517 .950 .255

Dependent Variable: USAGE and Independent Variable : Current income, Product meets your financial needs, Risky product, Interest Rate are high, Better than other investment, repayment Burden and Fail to plan led you to this product.

The F value for current income is 14.743; because p = .001, F value for product meets your financial needs is 16.986; because p = .001 the F value is significant at = .05. The null hypothesis is rejected, and all the variable under study is a significant defining variable of Usage of Reverse Mortgage.
Model Summary Multiple R .932 R Square .868 Adjusted R Square

.822 Dependent Variable: USAGE Predictors: CURRENT INCOME PRODUCT MEETS YOUR NEED RISKY PRODUCT INTEREST RATE ARE HIGH BETTER THEN OTHER INVESTMENET REPAYMENT BURDEN FAIL TO PLAN LET YOU TO THIS PRODUCT

R Square Value: 0.868: 86.80 % of variation in the Usage of reverse mortgage is explained by the all the variable under study.

Conclusion:
The Multiple regression equation for usage of student loan becomes : Y = (0.492)X1 + (0.506)X2 - (0.030)X3 (0.058)X4 (-0.057)X5 + (0.006)X6 + (-0.119)X7 Where, Y is the usage of Reverse Mortgage and X1 is The current monthly income from pension or other fixed income investment. X2 is Product meets your financial need. X3 is Reverse Mortgage is a risky product. X4 is Interest rate are high on this product. X5 is Better then other fixed income investment. X6 is Repayment Burden. X7 is Fail to plan led us to this product. The above equation implies that:

For 1 unit change in current monthly income variable, the usage changes by 0.492 For 1 unit change in product meet your financial need variable, the usage changes by 0.506 For 1 unit change in reverse mortgage risky product variable, the usage changes by 0.030 For 1 unit change in Interest Rate are High variable, the usage changes by 0.030 For 1 unit change in better than other fixed income investment variable, the usage changes by -0.057 For 1 unit change in repayment burden variable, the usage changes by 0.006
Correlations and Tolerance

Correlations Zero-Order .851 .858 .525 Partial .651 .678 .067 Part .312 .334 .024

CURRENT INCOME PRODUCT MEETS YOUR NEED RISKY PRODUCT

Importance Tolerance After Before Transform Transform ation ation Zero-Order .482 .402 .402 .501 .018 .436 .653 .436 .653

INTEREST RATE ARE HIGH BETTER THEN OTHER INVESTMENET REPAYMENT BURDEN FAIL TO PLAN LET YOU TO THIS PRODUCT Dependent Variable: USAGE

-.338 -.081 .092 -.118

.131 -.146 .014 -.253

.048 -.054 .005 -.095

-.023 .005 .001 .016

.667 .868 .822 .643

.667 .868 .822 .643

The above table shows that:

Product meets your need with Zero order correlation value of 0.858 and Importance value of 0.501 is the most dominant factor in determining the usage of Reverse Mortgage. Thus we can conclude that product satisfying the financial need is the most determining factor for usage of the product.

Current income with Zero order correlation value of 0.851 and Importance value of 0.482 is the second most dominant factor in determining the usage of Reverse Mortgage. Thus we can conclude that current income is the most determining factor for reverse mortgage.

Recommendation
Following is our recommendation for the 3 banking products in order to make them more successful among masses: e-Shop Card 1) Increase the basic know-how about this product so that people better understand its advantages and how the product actually works. This can be done by advertising in print media such as newspapers, business magazines etc or through TV where it can be explained why e-Shop card is a better, more convenient and a safer option than Debit/Credit Card for Online Shopping. Also, the banks need to educate their customers about the basic steps involved in using the e-shop card. This can be done when the customers actually visit the bank for other purposes.

2) Also the second major reason for this product's failure i.e. the Username-Password remembering process needs to be catered to. This can be done by slightly altering the current procedure of Username Password process where every time the customer needs to generate a new Username Password every time he wants to shop online using e-shop card. Thus a single permanent Username Password should be made for lifetime for every customer so that this whole process of Username-Password gets less tedious and hence stop working as a deterrent to this product's success.

Student Loan 1) The Perception that Repayment of a Student Loan is very difficult has to be done away with. This can be done through clearly stating the Repayment Period, which is generally very convenient and suitable. Also The Banks can suggest various attractive EMI Schemes. 2) If people would be aware of Tax Benefits on Student Loan, they would be more inclined to Student Loan. The promotions of such loans have to be made in such a manner so as to effectively propagate these special features. Reverse Mortgage 1) Current income of the target population holds the major key to the usage of the product; banks should target such groups and hence increase the awareness about the product. 2) Bank should highlight the product feature like monthly income, liability up to the value of mortgaged property and no repayment burden on legal heir of the user of the product, no interest payment till the expiry of the product or end of user life.