Escolar Documentos
Profissional Documentos
Cultura Documentos
Project Undertaken at
HDFC Bank Ltd
Project Mentors:
Mr. Ashish Verma, Branch Manager, HDFC Bank Phase 3B2, Mohali.
By:
Nikhil Gharu
Panjab University.
ACKNOWLEDGEMENT
I take this opportunity to express my deep sense of gratitude, thanks and regards
towards all of those who have directly or indirectly helped me in the successful
completion of this project.
I am ineffably indebted to Mr. Ashish Verma, Branch Manager, HDFC Bank
Phase 3B2 Mohali and Mr. Ankush Taneja, Imperia Relationship Manager,
HDFC Bank Phase 3B2 Mohali and Mr. Dinesh Seth, Cluster Manager Mohali
for their conscientious guidance and encouragement to accomplish this assignment.
Their able guidance at each step of the project helped me to broaden my outlook on
the project and in successful completion of the project.
I would also like to thank HDFC bank Staff for their wonderful support & inspirable
guiding.
I am grateful to all faculty members of UBS, Chandigarh and my friends who have
helped me in the successful completion of this project.
Last but not the least I am indebted to my parents and family who provided me their
time, support and inspiration needed to prepare this report.
Nikhil Gharu
DECLARATION
I undersigned Nikhil Gharu student of MBA declare that I have done the project on
Product Penetration and Digitalization has been personally done by me under the
guidance of Mr. Ashish Verma (Branch Manager, HDFC Bank) in partial fulfillment
of MBA Program during academic year: 2016-18. All the data represented in this
project is true & correct to the best of my knowledge & belief.
I hope that this project will be beneficial to the Organization.
Nikhil Gharu
Contents
1. Introduction
1.1 History of Banking
1.2 Mission, Vision & Business Strategy
1.3 Board of Directors and Business Heads
1.4 Awards
1.5 Integrated financial Service
1.6 Business Statement
1.7 Objective of Study
1.8 Problem Definition
1.9 Importance of Study.
3. Review of Literature
4. Research Methodology
4.1 Research Design
4.2 Sample
4.3 Sampling
4.4 Data Collection.
4.5 Data Analysis.
5. Analysis
5.1 Descriptive Analysis
5.2 Inferential Analysis
6. Findings
6.1 Conclusion.
6.2 Managerial Implication
6.3 Limitation
References
Annexure
Introduction
Banking is nearly as old as civilization. The history of banking could be said to have
started with the appearance of money. The first record of minted metal coins was in
Mesopotamia in about 2500B.C. the first European banknotes, which was handwritten
appeared in1661, in Sweden. Cheque and printed paper money appeared in the 1700s
and 1800s, with many banks created to deal with increasing trade.
The history of banking in each country runs in lines with the development of trade and
industry, and with the level of political confidence and stability. The ancient Romans
developed an advanced banking system to serve their vast trade network, which
extended throughout Europe, Asia and Africa.
Modern banking began in Venice. The word bank comes from the Italian word ban
co, meaning bench, because moneylenders worked on benches in market places. The
bank of Venice was established in 1171 to help the government raise finance for a
war.
At the same time, in England merchant started to ask goldsmiths to hold gold and
silver in their safes in return for a fee. Receipts given to the Merchant were sometimes
used to buy or sell, with the metal itself staying under lock and key. The goldsmith
realized that they could lend out some of the gold and silver that they had and charge
interest, as not all of the merchants would ask for the gold and silver back at the same
time. Eventually, instead of charging the merchants, the goldsmiths paid them to
deposit their gold and silver.
The bank of England was formed in 1694 to borrow money from the public for the
government to finance the war of Augsburg against France. By 1709, goldsmith were
using bank of England notes of their own receipts.
New technology transformed the banking industry in the 1900s round the world,
banks merged into larger and fewer groups and expanded into other country.
Banking Structure in India
In todays dynamic world banks are inevitable for the development of a country.
Banks play a pivotal role in enhancing each and every sector. They have helped bring
a draw of development on the worlds horizon and developing country like India is no
exception.
Banks fulfills the role of a financial intermediary. This means that it acts as a vehicle
for moving finance from those who have surplus money to (however temporarily)
those who have deficit. In everyday branch terms the banks channel funds from
depositors whose accounts are in credit to borrowers who are in debit.
Without the intermediary of the banks both their depositors and their borrowers would
have to contact each other directly. This can and does happen of course. This is what
has lead to the very foundation of financial institution like banks.
Before few decades there existed some influential people who used to land money.
But a substantially high rate of interest was charged which made borrowing of money
out of the reach of the majority of the people so there arose a need for a financial
intermediate.
The Bank have developed their roles to such an extent that a direct contact between
the depositors and borrowers in now known as disintermediation.
Banking industry has always revolved around the traditional function of taking
deposits, money transfer and making advances. Those three are closely related to each
other, the objective being to lend money, which is the profitable activity of the three.
Taking deposits generates funds for lending and money transfer services are necessary
for the attention of deposits. The Bank have introduced progressively more
sophisticated versions of these services and have diversified introduction in numerable
areas of activity not directly relating to this traditional trinity.
Indian Banking System
Central co-op
State co-op Commercial Banks and Commercial Banks
Banks Banks Primary Cr.
Societies
Indian Foreign
Public Sector
Banks Private Sector HDFC,
Banks ICICI etc.
The banking scenario in India has been changing at fast pace from being just the
borrowers and lenders traditionally, the focus has shifted to more differentiated and
customized product/service provider from regulation to liberalization in the year 1991,
from planned economy to market.
Economy, from licensing to integration with Global Economics, the changes have
been swift. All most all the sector operating in the economy was affected and banking
sector is no exception to this. Thus the whole of the banking system in the country has
undergone a radical change. Let us see how banking has evolved in the past 57 years
of independence.
After independence in 1947 and proclamation in 1950 the country set about drawing
its road map for the future public ownership of banks was seen inevitable and SBI was
created in 1955 to spearhead the expansion of banking into rural India and speed up
the process of magnetization.
Political compulsions brought about nationalization of bank in 1969 and lobbying by
bank employees and their unions added to the list of nationalized banks a few years
later.
Slowly the unions grew in strength, while bank management stagnated. The casualty
was to the customer service declined, complaints increased and bank management was
unable to item the rot.
In the meantime, technology was becoming a global phenomenon lacking a vision of
the future and the banks erred badly in opposing the technology up gradation of
banks. They mistakenly believed the technology would lead to retrenchment and
eventually the marginalization of unions.
The problem faced by the banking industry soon surfaced in their balance sheets. But
the prevailing accounting practices unable banks to dodge the issue.
The rules of the game under which banks operated changed in 1993. Norms or income
Recognition, Assets classification and loan loss provisioning were put in place and
capital adequacy ratio become mandatory. The cumulative impact of all these changes
has been on the concept of state ownership in banks. It is increasingly becoming clear
that the state ownership in bank is no longer sustainable.
The amendment of banking regulation act in 1993 saw the entry of new private sector
banks and foreign banks.
About HDFC Bank
HDFC BANK LTD was incorporated in August 1994 in the name of 'HDFC Bank
Limited', with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995.
If ever there was a man with a mission it was Hasmukhbhai Parekh, Founder and
Chairman-Emeritus, of HDFC Group. HDFC BANK LTD was amongst the first
to set up a bank in the private sector. The bank was incorporated on 30th August 1994
in the name of HDFC Bank Limited, with its registered office in Mumbai. It
commenced operations as a Scheduled Commercial Bank on 16th January 1995. The
bank has grown consistently and is now amongst the leading players in the industry
.
HDFC is India's premier housing finance company and enjoys an impeccable track
record in India as well as in international markets. Since its inception in 1977, the
Corporation has maintained a consistent and healthy growth in its operations to
remain the market leader in mortgages. Its outstanding loan portfolio covers well over
a million dwelling units.
HDFC has developed significant expertise in retail mortgage loans to different market
segments and also has a large corporate client base for its housing related credit
facilities. With its experience in the financial markets, a strong market reputation,
large shareholder base and unique consumer franchise, HDFC was ideally positioned
to promote a bank in the Indian environment In a milestone transaction in the Indian
banking industry, Times Bank was merged with HDFC Bank Ltd., effective February
26, 2000. The shares are listed on the Bombay Stock Exchange Limited and The
National Stock Exchange of India Limited. The Bank's American Depository Shares (
ADS ) are listed on the New York Stock Exchange (NYSE) under the symbol 'HDB'
and the Bank's Global Depository Receipts (GDRs) are listed on Luxembourg Stock
Exchange.
On May 23, 2008, the amalgamation of Centurion Bank of Punjab with HDFC Bank
was formally approved by Reserve Bank of India to complete the statutory and
regulatory approval process. As per the scheme of amalgamation, shareholders of
CBoP received 1 share of HDFC Bank for every 29 shares of CBoP.
The merged entity now holds a strong deposit base of around Rs. 1,22,000 Crore and
net advances of around Rs. 89,000 crore. The balance sheet size of the combined
entity would be over Rs. 1,63,000 crore. The amalgamation added significant value to
HDFC Bank in terms of increased branch network, geographic reach, and customer
base, and a bigger pool of skilled manpower.
In a milestone transaction in the Indian banking industry, Times Bank Limited
(another new private sector bank promoted by Bennett, Coleman & Co. / Times
Group) was merged with HDFC Bank Ltd., effective February 26, 2000. This was the
first merger of two private banks in the New Generation Private Sector Banks. As per
the scheme of amalgamation approved by the shareholders of both banks and the
Reserve Bank of India, shareholders of Times Bank received 1 share of HDFC Bank
for every 5.75 shares of Times Bank
1.2 Mission, Vision and Business Strategy
Mission
I. World Class Indian Bank
II. Benchmarking against international standards.
III. To build sound customer franchises across distinct businesses
IV. Best practices in terms of product offerings, technology, service levels, risk
management and audit & compliance
Vision Statement
The HDFC Bank is committed to maintain the highest level of ethical standards,
professional integrity and regulatory compliance. HDFC Banks business philosophy
is based on four core values such as:-
1. Operational excellence.
2. Customer Focus.
3. Product leadership.
4. People.
The objective of the HDFC Bank is to provide its target market customers a full range
of financial products and banking services, giving the customer a one-step window for
all his/her requirements. The HDFC Bank plus and the investment advisory services
programs have been designed keeping in mind needs of customers who seeks distinct
financial solutions, information and advice on various investment avenues.
Business Strategy
I. Increasing market share in Indias expanding banking
II. Delivering high quality customer service
III. Maintaining current
high standards for asset quality through disciplined credit
risk management
IV. Develop innovative products and services that attract targeted customers and
address inefficiencies in the Indian financial sector.
1.3 Board of Directors and Business Heads
Mr. Aditya Puri holds a Bachelor's degree in Commerce from Punjab University
and is an Associate Member of the Institute of Chartered Accountants of India.
Prior to joining the Bank, Mr. Puri was the Chief Executive Officer of Citibank,
Malaysia . Mr. Puri has been the Managing Director of the Bank since September
1994. Mr. Puri has nearly 40 years of experience in the banking sector in India and
abroad. Mr. Puri has provided outstanding leadership as the Managing Director and
has contributed significantly to enable the Bank scale phenomenal heights under his
stewardship. The numerous awards won by Mr. Puri and the Bank are a testimony
to the tremendous credibility that Mr. Puri has built for himself and the Bank over
years.
Mr. Puri is a member of the following Committees of the Board of the Bank:
Stakeholders' Relationship Committee
A N Roy Director
Asia Money India Banking Awards 2017 Best Domestic Bank- India
Business Standard Annual Awards 2016 Banker of the year Mr. Aditya puri
IBA Banking Technology Awards 2017 Best IT Risk and cyber security
initiatives
Finance Asia Poll on Asias Best Best CEO Mr. Aditya Puri
Companies 2016
Best at Investors relation Rank1
Institutional Investor All-Asia Executive Mr. Aditya Puri ranked Best CEO
Team ranking 2016 -HDFC Bank ranked Best Company in
Banks sector of Asia ex-Japan
BrandZ Top 50 Most Valuable Indian HDFC Bank has been ranked India's
Brands most valuable brand for the 3rd
consecutive year
1.5 Integrated Financial Services
Wholesale Banking Services:
The Bank's target market ranges from large, blue-chip manufacturing companies in
the Indian corporate to small & mid-sized corporate and agri-based businesses. For
these customers, the Bank provides a wide range of commercial and transactional
banking services, including working capital finance, trade services, transactional
services, cash management, etc. The bank is also a leading provider of structured
solutions, which combine cash management services with vendor and distributor
finance for facilitating superior supply chain management for its corporate customers.
Based on its superior product delivery / service levels and strong customer orientation,
the Bank has made significant inroads into the banking consortia of a number of
The objective of the Retail Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one-stop
window for all his/her banking requirements. The products are backed by world-
class service and delivered to the customers through the growing branch network, as
well as through alternative delivery channels like ATMs, Phone Banking, Net
Banking and Mobile Banking.
The HDFC Bank Preferred program for high net worth individuals, the
HDFC Bank Plus and the Investment Advisory Services programs have been
designed keeping in mind needs of customers who seek distinct financial solutions,
information and advice on various investment avenues. The Bank also has a wide
array of retail loan products including Auto Loans, Loans against marketable
securities, Personal Loans and Loans for Two-wheelers. It is also a leading provider
of Depository Participant (DP) services for retail customers, providing customers the
facility to hold their investments in electronic form.
HDFC Bank was the first bank in India to launch an International Debit Card
in association with VISA (VISA Electron) and issues the Master card Maestro debit
card as well. The Bank launched its credit card business in late 2001. By September
30, 2005, the bank had a total card base (debit and credit cards) of 5.2 million cards.
The Bank is also one of the leading players in the "merchant acquiring" business
with over 50,000 Point-of-sale (POS) terminals for debit / credit cards acceptance at
merchant establishments.
Treasury:
Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With
the liberalization of the financial markets in India, corporate need more sophisticated
risk management information, advice and product structures. These and fine pricing
on various treasury products are provided through the bank's Treasury team. To
comply with statutory reserve requirements, the bank is required to hold 25% of its
deposits in government securities. The Treasury business is responsible for
managing the returns and market risk on this investment portfolio.
1.7 Objective of Study
The title of the project is Product Penetration and Digitalization. Under this I
have to do a market survey and scoping for bank products used by existing and
potential clients in the manufacturer and trader segment.
Following are the main objectives of our study
Collect details via survey of manufacturers, traders and merchants in our
catchment area.
Competition analysis- Market Share and recommendations to capture more
market.
Analysis of working capital and its usage to banking industry.
Credit card usage pattern and recommendations for increasing its market
share.
Lead Generation for working capital POS machines.
Create awareness about chiller and Payzapp.
The following are some important terms in the project which need to be understood
before describing about the research.
Manufacturer and Trader.
The catchment area is phase 8,phase 9,phase 10 industrial area. The business may be
in sole propertiership or partnership. There are around 100+ manufacturer and traders
in combining these sectors.
Market Survey
The market survey was done for the traders through a proper conversation with them.
The aim was basically to find out who are there with the bank, who are not, what are
the main reasons of them using different banking product of either HDFC bank or any
other bank, what are their satisfaction level with the primary bank on different
parameters so that the potential clients can be targeted through the parameter with
which they dont feel satisfactory with primary bank.
Competitors
The competitors analysis on various parameters was done according to the survey of
their clients. If we talk about Mohali industrial area , then its one of the oldest and
biggest industrial place of Mohali having a lots of competition in banking being the
major focus market .
1.9 Importance of Study
The study would try to throw some insights into the existing services provided by the
banks, perceptions and the actual service quality of the bank. The results of the study
would be able to recognize the lacunae in the system and thus provide key areas
where improvement is required for better performance and success ratio. In the days
of intense competition, superior service is the only differentiator left before the banks
to attract, retain and partner with the customers. Superior service quality enables a
firm to differentiate itself from its competition, gain a sustainable competitive
advantage, and enhance efficiency.
HDFC Bank products for Manufacturer and Trader
HDFC Bank Current Account gives the power of inter-city banking with a single
account and access to more than cities. From special cheques that get treated at par
with local ones in any city where branch, faster collection of outstation cheques
(payable at branch locations), free account to account funds transfer between HDFC
Bank accounts to Free inter-city clearing of up to 100 lakhs per month, banks priority
services have become the benchmark for banking efficiency.
Now, with an HDFC Bank Current Account, experience the freedom of multi-city
banking. Person can have the power of multi-location access to his account from any
of our 761 branches in 327 cities. Not only that, he can do most of his banking
transactions from the comfort of his office or home without stepping out.
There are various kinds of current account in this bank like: -
Plus current account
HDFC Bank plus Current Account gives the power of inter-city banking with a single
account and access to more than cities. Plus Current Account requires maintaining an
average quarterly balance of Rs. 100,000.
Trade current account
In today's changing business requirements, you need to transfer funds across cities,
and time is of the essence. HDFC Bank Trade Current Account gives power of inter-
city banking with a single account.
From special cheques that get treated at par with local ones in any city where bank
have a branch, to free account to account funds transfer between HDFC Bank
accounts, to free inter-city clearing of up to 50 lakhs per month, banks priority
services have become the benchmark for banking efficiency. Trade Current Account
requires maintaining an average quarterly balance of Rs. 40,000.
Premium current account
Business needs a partner who can manage finances while concentrate on growing
business. Form this account customer can avail benefits of inter-city banking account
that requires an average quarterly balance of only Rs. 25,000, offers Payable-At-Par
cheque book facility & FREE inter-city clearing transactions across our network up to
Rs.25 Lacs per month.
A Current Account with the benefits of accessing account from a large network of
branches, and through direct access channels - the phone, mobile, Internet and through
the ATM.
Regular current account
A Current account is ideal for carrying out day-to-day business transactions. With the
HDFC Bank Regular Current Account, customer can access account anytime,
anywhere, pay using payable at par cheques or deposit cheque at any HDFC bank
branch. It also facilitates FREE NEFT transactions & FREE RTGS collections for
faster collections in account. Regular Current Account requires to maintain an average
quarterly balance of only Rs. 10,000.
With a vast network of branches in cities all over the country, and access to a
multitude of ATM's, customer can keep track of all transactions anytime.
Reimbursement Current Account
RFC Domestic Account
Full name of this account is Resident foreign currency account.
Have you accumulated foreign currency from travelling abroad frequently? Received
gifts from relatives in foreign currency? Or earned it by any other means as approved
by the Reserve Bank of India?
If so, open Resident Foreign Currency Domestic Account and manage foreign
currency efficiently. Person can choose to set up your account either in US Dollar,
Great Britain Pound or Euro.
To open this accounts a person as to follow this process: -
Choose the currency in which person wish to operate. Open account with an initial
amount as per the following-US Dollar = 250 Great Britain Pound = 200 Euro = 250
and maintain an Average Quarterly Balance of the same amount.
Flexi current account
Tired of static transaction limits during peak seasons? HDFC Bank Flexi Current
Account is the answer to changing banking needs during peak seasons.
With HDFC Bank Flexi Current Account Cash Deposit and Anywhere Transaction
limits are a multiple of the balance you maintain in Current Account. So, during peak
seasons, customer get the benefit of higher transaction limits due to the higher average
balances maintained in account. Whats more, during lean seasons, person need not
worry about maintaining huge balances to enjoy high transaction limits, which person
anyway may not need. Flexi Current Account requires to maintain a minimum
Average Monthly Balance (AMB) of just Rs. 75,000.
Apex current account
The top position is always the desirable position. With the Apex current account, take
business to a new high. On maintaining an average quarterly balance of Rs. 10 lakhs,
this account makes sure person make the most of every business opportunities coming
his way. Unlimited, free, anywhere Banking experience at the APEX is reserved for
person who joints this.
.
Max current account
Maximum benefits and minimum hassles for customer with Max Current Account
with a Rs. 5 lakhs average quarterly balance requirement, bank present to world of
privileges that helps business expand and grow. Features like maximum free
transaction limits including other beneficial features on this current account truly
enhances business potential to the Maximum.
2.2 Limits
HDFC Bank offers a unique range of working capital facilities at door-step. It offers
affordable, convenient financial solutions which are of paramount importance in
running an efficient enterprise.
Types of Working Capital / Limit
Cash Credit / Overdraft- HDFC Bank offers Cash Credit / Overdraft
facilities to various segments of customers for their working capital
requirements. This is a fund based facility to help fund business inventory
(raw materials and finished goods) and receivables (debtors).
Letter of Credit (LC) - HDFC bank offer import financing through Letters of
Credit, which are well accepted globally and supported by a strong trade
finance set up. It is direct members of SWIFT and has correspondent banking
Bank Guarantee (BG) - Bank Guarantees are necessary for certain business
obligations. At HDFC Bank, Bank Guarantees are issued on customers behalf
under any business contract.
2.3 POS
In the technical world people are trying to keep as much less cash with themselves as
they can. So point-of-sales or swapping machines are a basic requirements for every
trader.
Personal loan
A person has so many dreams but some time due to scarcity of money a dream cant
be satisfy. So, here one solution for that person this is personal loan. From this he/she
can fulfill their needs or requirement. It can be any thing either a dream of vacation or
son/daughters admission to college or any wedding, so personal loan can be helpful
in this entire requirement.
As person ordered in the hotel for tea or coffee and it is immediately came fast, same
over here any person want to get a personal loan with the nominal documents he can
get the loan.
Home loan
HDFC Bank brings, HDFC home loans to doorstep. With over 30 years of
experience, a dedicated team of experts and a complete package to meet all housing
finance needs, HDFC Home Loans, help people realize dream.
Vehicles loan
Nowadays the life is being so fast, time value is becoming more important so to
reach at the destination of any business related occasion or for a boy to reach college
or any where at the fix time there are so many requirement of vehicles. But every
people have no capacity to purchase vehicles with cash so for that here in the HDFC
bank vehicles loan is available. There are many types of vehicles loan.
Types of vehicles loan:
Two wheeler loans.
New car loan.
Used car loan.
Tractor loan (for agree culture business).
Commercial vehicle loan.
So, as per the requirement of the person there are these types of loans are available
this are at the chip rate and hassel free from more documentation and other procedure.
And commercial businessman can get the benefits of the commercial vehicles loans.
Thus as per the need of different people there are vehicle loans available. And also
terms and condition are different as per the requirement.
In todays competitive and fast time card services providing by the banks are
really very important to every person and every business needs or to take meal in to
the hotel or to purchase jewellery from the jewellery shops cards are playing good role
in the banking sectors.
Bank ranges of Cards help to meet financial objectives. So whether persons are
looking to add to his buying power, conducting cashless shopping, or budgeting his
expenditure, he will find a card that suits him.
Credit cards
A person wants many things like, a trip to Bali, a diamond ring for wife's dreams.
Some dreams can't wait. If there's something person has always wanted. If a person
wanted fulfill his wants he can get benefits from the HDFC banks credit cards
facilities. different types of credit
Classic cards
Silver Credit Card.
Value plus Credit Card.
Health Plus Credit Card.
Premium Cards:
Gold Credit Card
Titanium Credit Card
Woman's Gold Card
Platinum Plus Credit Card
Visa Signature Credit Card
World MasterCard
Commercial Cards
Corporate Credit Card
Debit card
HDFC Bank Debit Cards give person complete and instant access to the money in his
accounts without the risk or hassle of carrying cash.
Types of debit card: -
Classic card
Easy shop international Debit card.
Premium card
Easy shop gold Debit card.
Specialized card
Easy Shop International Business Debit Card
Easy Shop Woman's Advantage Debit Card
Easy Shop NRO Debit Card
Kisan Card
Prepaid card
Besides offering convenience, Prepaid Cards have been tailored to answer travel and
gifting needs.
ForexPlus Cards
Prepaid Travel Card.
Gift Plus Cards
Prepaid Gift Card
Food Plus Cards
Prepaid Food Plus card.
Money Plus Card
The Corporate Payment card
Payment Services
Nowadays life of a person become very stressful and he/she becoming busy with their
own business, but they have to payment for something so for that reason banks
payment services become started. With HDFC Bank's payment services, person can
bid goodbye to queues and paper work. Banks range of payment options make it easy
for pay for a variety of utilities and services.
Verified By Visa
Do you want to be worry free for your online purchases. Now you can shop securely
online with your existing Visa Debit/Credit card.
Net Safe
Now shop online without revealing your HDFC Bank Credit Card number. What
more, you can now use your HDFC Bank Debit Card also for online purchases.
Merchant Services
Accept all Visa, MasterCard, credit and Debit cards at your outlets through state of the
art POS Machines or through your website and experience hassle free payment
acceptance.
Consumer Perception
Different social classes exist and target marketing would enable banks to tap the
potential in such segments Income need not be the most determinant factor in
segmentation. Psychological differences largely remain unexplored in the Indian
markets. In the financial products marketing, the opinion of reference groups has
considerable influence on customer's choices. A customer is more
likely to share the attitude of his or her reference group. If information obtained by a
customer contradicts with what the reference groups believes in, the customer will also
develop unfavourable attitude towards the product. Marketing people can identify
suitable reference groups to build up favourable image and opinion. This is especially
true in marketing to retail segments which often look for reliable sources of information.
The over dependence of customers on image in the services industry can be best
explained by the problem of credibility of information sources and the intangible nature
of the service. In the case of banks, studies have shown that customer choice is largely
decided by the opinion of peers, parents and relatives.
Family plays an important role in the choice of a bank. Youngsters tend to choose the
banks of their parents. Martineau (1958) conducted a study among students opening
account for the first time in their life and found
that parental influence ranked second to
'location_ of banks in their choice of bank.
Product needs also vary across different life cycle stages of a family Rajashekar and
Paul(1999) have found the relative importance of the choice criteria across life cycle
segments. 3 Individuals in the bachelor stage (young.
single people not living at
The Consume. Frocess and Loyalty- Consumer purchase decisions are made
haphazardly, though certain dominant features might influence the choice of financial
institutions in general. Choice of specific financial products may involve a decision
making process consisting of different phases such as getting aware of the need,
searching for alternatives, evaluation of the options, choice of a product and post-
purchas evaluation. At each stage, their information needs may also change.
Understanding the information needs of customers at these different phases is hence
essential for planning marketing communications. However. it has been observed that
customers do not often seek the finer details of schemes and services through the
advertisements. Most ofthe information required is passed over the counter by bank
personnel. Counter staff should have good product knowledge and communication
skills to take up this responsibility. The post purchase phase is also crucial in the sense
that a bank staff should be able to provide assurance to the customers about the
benefits and reinforce their purchase decision so as to ensure loyalty of the customer.
Banks in India generally enjoy good patronage by customers. Despite the introduction
of many new schemes, bank deposit still reign superiority in the household savings.
This clearly illustrates popularity of banks among common people. Interestingly,
products like National Savings Certif1cates(NSC), Unit Trust of India schemes(UTI),
etc, though carry higher returns, have not been as popular as bank deposits. Some
banks are pat.-cnised by customers irrespective of the service quality levels they
maintain. These are a few aspects that makes one to probe into the reasons of
customer loyalty in banking industry. From the perspective of bankers ensuring
customer loyalty is important for the following reasons.
Product
and
Services
Interest Customer
Rates Interest
ITEMS
Forex WC
Services Provisions
Research Methodology
As the study is for markets survey of products of HDFC Bank so our research design is
exploratory. In this we are having some knowledge about the manufacturer & traders as
they use current a/c, POS, limits etc. But there are still lack of satisfaction regarding
various factors, so this study is going to find out what are they and how can be they
overcome.
The catchment area is phase ,8 phase 9 phase 10 industrial area. The business may be in
sole propertiership or partnership. There are around 100+ manufacturer and traders in
combining these sectors, but due to various constraints the sample size got limited to 97
only.
There was a proper structured interview method based on a questionnaire (in annexure)
by visiting shop-to-shop. The questionnaire was prepared by mentors help and with
some references, done earlier. So all the data collected is primary data. These
information was provided either by traders themselves or by the one who manage shops
account and financial activities.
Descriptive Analysis- In this basically the raw data has been analysed which was
obtained based on questionnaires. It simply hives some graphs. Tables and
diagrams and there simple interpretation.
Hypothesis of the Study:
H1: Consumer Perception has a significant impact on customer Satisfaction.
H2: Product and Services has a significant relationship with customer satisfaction.
H3: Customer Interest has a significant relationship with the customer satisfaction.
H4: Working Capital Provision has a significant relationship with the customers
satisfaction.
H5: Forex Services has a significant relationship with the customer satisfaction.
H6: Interest Rates has a significant relationship with the customer satisfaction.
Data Analysis:
The following Data analysis is performed on the basis of the data filled in the
questionnaires. There are various tools of data analysis that helps the researcher to
interpret data into final results. Various tools have been used to analyse the data and for
the testing of Hypothesis.
Tests of Normality
a
Kolmogorov-Smirnov Shapiro-Wilk
Tests of Normality
a
Kolmogorov-Smirnov Shapiro-Wilk
Mean values of collected responses for each section was calculated and used for applying
normality test.
Since the sample size < 2000, Shapiro-Wilk test has been used for ascertaining the
normality of the data at hand.
Thus the p-values are well above 0.05; therefore the data under consideration is normal.
Thus, parametric tests shall be used for analysis.
Reliability Statistics
Cronbach's Alpha N of Items The scales are 77.8% reliable according to Cronbachs
alpha and it means that there is .778 probability that
.778 5
we are going to measure customer satisfaction
correctly.
Correlation:
HYPOTHESIS 1:
CONSUMER CUSTOMER
PERCEPTION SATISFACTION
CONSUMER Pearson Correlation 1 .782**
PERCEPTION Sig. (2-tailed) .000
N 97 97
CUSTOMER Pearson Correlation .782** 1
SATISFACTION
Sig. (2-tailed) .000
N 97 97
**. Correlation is significant at the 0.01 level (2-tailed).
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.782 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
CUSTOMER
PS SATISFACTION
PS Pearson Correlation 1 .632**
Sig. (2-tailed) .000
N 97 97
CUSTOMER Pearson Correlation .632** 1
SATISFACTION
Sig. (2-tailed) .000
N 97 97
H2: Product and Services has a significant impact on customer Satisfaction.
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.632 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.805 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
HYPOTHESIS 4:
CUSTOMER
WC SATISFACTION
WC Pearson Correlation 1 .625**
Sig. (2-tailed) .000
N 97 97
CUSTOMER Pearson Correlation .625** 1
SATISFACTION
Sig. (2-tailed) .000
N 97 97
**. Correlation is significant at the 0.01 level (2-tailed).
H4: Working Capital Provisions has a significant impact on customer Satisfaction.
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.625 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.683 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
HYPOTHESIS 6:
CUSTOMER
IR SATISFACTION
IR Pearson Correlation 1 .697**
Sig. (2-tailed) .000
N 97 97
CUSTOMER Pearson Correlation .797** 1
SATISFACTION Sig. (2-tailed) .000
N 97 97
**. Correlation is significant at the 0.01 level (2-tailed).
From table, The p value is .000 which is less than .05 this means that the correlation is
significant.
Correlation coefficient is 0.697 which means that there is a highly positive degree of
correlation between Service Quality and Customer Satisfaction.
ICICI
HDFC
OVERALL SBI
Canara
SBI
Manufacturers HDFC
HDFC
ICICI
Traders Induslnd
Since it can be observed that the bank with highest recall values are ICICI, HDFC, SBI.
HDFC stood second on the Top of the mind test. Top of the mind tests signify the recall
value of a brand. Mainly means what does comes to a consumers mind when they heard of
the word bank.
In the manufacturer segment HDFC stood on the third position, which means HDFC is not
that prevalent in the areas surveyed.
In the traders segment HDFC stood on the first position. It means among traders HDFC is
the most recalled brand i.e it is quite popular with the traders associated in the survey.
Market Share
Primary Bank
HDFC
37 Axis
SBI
Induslnd
8
ICICI
100 11
CANARA
5 YES
6
Vijay Bank
14
BOB
4
4 Central Bank
132
Out of the Data Collected from 97 respondents we found that 37 of them were having
HDFC Bank as their PRIMARY BANK. More than 50% of the market share was captured
by HDFC, Canara & ICICI Bank
Family Accounts
Family Accounts
Out of the Manufacturers and traders with HDFC as Primary Bank, Approximatley 70
percent of them have bank accounts with HDFC. This thus proves HDFC bank has good
Credibility with its existing customers.
Factors for choosing Primary Bank
Location
5%
9% 1
29%
2
14% 3
4
5
19% 6
24%
24 Percent of the sample selected location as the most important factor while choosing a
bank. 29 of the sample picked location as second most important. Thus it can be concluded
that location is a important factor while choosing bank. So easy accessibility of branches
will help in increasing customers.
10% 1
30% 2
17%
3
4
14%
5
28%
6
30 Percent of the sample selected location as the most important factor while choosing a
bank. 28 of the sample picked location as second most important. Thus it can be concluded
that good customer service is a important factor while choosing bank.
Reputation and Corporate Image
0%
1
24% 21% 2
3
4
23% 22%
5
10%
6
23 percent of people have choosen Reputation and corporate Image as their first factor for
choosing primary bank.
Products Offered
17% 15% 1
2
11% 3
14%
4
5
22%
21% 6
15 percent of people have choosen Reputation and corporate Image as their first factor for
choosing primary bank.
5%
1
11% 16% 2
3
26% 22% 4
5
20%
6
16 percent of people have choosen Reputation and corporate Image as their first factor for
choosing primary bank.
Interest Rate
9%
1
6%
2
41% 8%
3
3%
4
5
33% 6
9 percent of people have chosen Interest Rate as their first factor for choosing primary
bank.
Awareness about Payzapp/Chillr
22%
YES
NO
78%
Smart Hub
12%
YES
NO
88%
As seen from the above Pie Chart it is observed that 22 percent of the customers has opted
for perks for new clients and long term clients as the most important factor for switching
to a new bank.
Recommendations
Customer Perception has a positive correlation with Customer Satisfaction, thus
bank should use marketing techniques to promote a good image in the eyes of the
customer this will increase the customer satisfaction, thus helping to increase
market share.
Customer Interest has a positive correlation with Customer Satisfaction, thus bank
should use marketing techniques to promote a good image in the eyes of the
customer this will increase the customer satisfaction, thus helping to increase
market share.
The Top of Mind recall in the manufacturing is too low i.e. 3 position. So HDFC
Bank should target to the manufacturing sector to increase awareness and increase
it market share among this segment.
In the banking information, first section was for primary bank. Here around 25%
of the sample is having primary bank as HDFC Bank, which is a very less in
competitive terms, as here HDFC has one of the oldest branch. Still there are
various factors due to which traders are banking with most of the public sector
banks. All the traders were having current a/c with their primary banks, but still
very less are having limits from there bank, either it be HDFC or any other bank.
When asked about the reason for having a particular bank, people who are having
public sector bank they said either he knows someone in banks or the trust level is
very high with them but none of them said that I am getting very good service so
that I am with a particular public sector bank. So still there is the trust lack among
peoples regarding HDFC Bank, which is a major reason for lacking behind to
grab the market share.
Managerial Implications
The trust level among traders for private sector bank is very less. So HDFC
Bank should be the first in private sector to have some day-to-day meets with
traders. They should be provided with some constructive thinkingfor their
business regarding banking and provide them relevant information.
Cost is the one factor which is reason for considering public sector banks, for
solving these traders should be informed what the services extra to public
sector bank HDFC Bank is providing if it is having a higher cost. The traders
should be informed about all type of charges and then the services provided in
response to that charge.
The money deduction without informing is a major problem causing
dissatisfaction with any bank. HDFC should try to use technology in that term
and they should have a proper receipt system if any charge for any service is
cut and instant message should be delivered to traders phone with e-reciepts.
Multiple banking can be also taken as a challange. Traders should be informed
personally about paying more charges by having multiple banking by
personalized ways, so they can get attracted towards banks relationship easily.
Limit is the one product which is still undiscovered in market by major banks.
EMI options, working capital etc. are also about people dont have information.
There can be a day in bank in which all the sales officers should be available
just for giving consultation for free especially for traders. It can be named as
financial health consultation camp. It should can be organised in middle of a
market.
There is need of standardization in providing services and in dealing with
customers. There should be a proper protocol while dealing with a specific set
of customer.
References
1. 'SERVQUAL: A Multiple-Items Scale For Measuring Consumer Perceptions Of
Service Quality, Journal of kcrailing, o.64 (Spring 1988).
2. Ramesha, K., 'Banking Expectations and Bank Selection, IBA Bulletin, Vol.21, No. 9, 1999.
3. Roy, Ghosh D., Customer Knowledge Management: Branch Level Significance, Vinimaya, Vol. II, No.
1,1999.
5. Rust R.T., A.J.Zahorik, and T.L Keiningham, Return on Quality: Measuring the Financial Impact of your
Companys Quest for Quality, Probus, Chicago,
I1linious,1994.
6. Mattila, Anna S., The role of culture in the Service Evaluation Process, Journal of Service Research, Vol. 1,
No 3, pp. 50-61, 1999.
7. Morgan R.M and S.D Hunt, The Commitment-Trust Theory of Relationship Marketing, Journal of
Marketing, Vol.58, 1994.
9. Nicholls, J. A. F., S. Roslow, J. Tsolikis, Time is Central, International Journal ofBank Marketing, Vol.11,
No.5,1993.
10. Lepak. Greg M., ' Bayesian approach for analysing the services of banking institutions, The Journal of
Consumer Affairs: Vol 32., No.1, Summer 1998
Annexure
Questionnaire HNW Scoping and Market Survey
Which is your primary bank and how long have you been associated with this bank?
__________________________________________________.
What factors made you choose your primary bank? (Rank according to your preference)
Does your family have accounts with the same bank? YES / NO
1 2 3 4 5
Credit Card POS/Merchant Working Capital RTFX Online Banking
Swipe Machine Limits (FOREX) Services (ENET)
6 7 8 9 10
Net Banking Doorstep Cheque Salary Accounts Mobile Banking Digital Wallets
Collection
Interest Rates on FDs and CASA offered by HDFC are competitive as compared to other banks.
What are the most important factors you are going to consider if you are to switch your bank? Pick any four.
Interest Rates on Savings and Fixed Mobile and Internet Platforms Minimum Service charges
Deposits /Recurring Deposits provided by banks
PERSONAL INFORMATION:
Name
Occupation
Age
Contact Number-