change management_research paper
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CUSTOMER SATISFACTION IN
RETAIL BANKING SECTOR:
WITH REFERENCE TO HDFC BANK, SURAT
Krishna Kedia
ABSTRACT
For every organization, customer satisfaction plays vital roles that enhance loyalty and
profitability of the firm. Earlier, all sectors focused on Market Orientation, but now they need to
divert their focus towards Customer Orientation for their survival and growth in the competitive
market. Due to rapid changes in the retail banking sectors in India, it has become inevitable for
the service organization to study the level of customer satisfaction in their organization, dedicate
resources to upkeep that level and revamp the process if required. The purpose of this paper is to
evaluate the level of customer satisfaction amongst the customers of HDFC bank, by
acknowledging the major factors that contribute towards it and establish their importance in the
organizational setup. The results reveal that the customers of the HDFC bank are satisfied with
the way the bank handles all the aspects that drive their level of satisfaction with the firm. In
addition to it, they consider it to be superior in terms of the quality of service that the firm offers
to its customers. None of the customers plan to switch their banking service provider any time
soon and propose to stay a loyal to the HDFC bank. This shows that the firm holds a positive
image in the market and that there is a positive sentiment amongst the customers with reference
to the HDFC bank.
Key Words: Customer Satisfaction, Customer Orientation, Service Quality, Customer Centrism,
Customer Loyalty
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1.1 INTRODUCTION
“A satisfied customer is the best business strategy of all.”
- (LeBoeuf, 1997)
Since time immemorial, customer satisfaction has been the centre of universe for every business
that aspires to survive and grow in the market. It is a very common and a frequently used term in
marketing. It is a measure of how products and services supplied by a company meet or surpass
customer expectation. Every company that formulates its business strategies taking into
consideration “Customer Satisfaction” as the core business operation will definitely flourish,
whatever be the market conditions. Especially, when it comes to service industry, it is the degree
of customer satisfaction that defines the success of an organisation and when one has such
intense competition as in the Indian Retail Banking Sector, customer satisfaction becomes the
topmost priority for an organisation.
1.11 INDUSTRY PROFILE: BANKING SECTOR IN INDIA 1
India‟s banking sector is constantly growing. Since the turn of the century, there has been a
noticeable upsurge in transactions through ATMs, and also internet and mobile banking.
Following the passing of the Banking Laws (Amendment) Bill by the Indian Parliament in 2012,
the landscape of the banking industry began to change. The bill allows the Reserve Bank of India
(RBI) to make final guidelines on issuing new licenses, which could lead to a bigger number of
banks in the country. Some banks have already received licences from the government, and the
RBI's new norms will provide incentives to banks to spot bad loans and take requisite action to
keep rogue borrowers in check.
Over the next decade, the banking sector is projected to create up to two million new jobs, driven
by the efforts of the RBI and the Government of India to integrate financial services into rural
areas. Also, the traditional way of operations will slowly give way to modern technology.
1 (Beri, 2014)
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Figure 1: Contribution of Banking towards GDP in India
The aforementioned chart depicts the contribution of the Indian Banking Sector towards the GDP
of the nation. It can be observed that the role of the banking sector has been ever increasing since
1990 form 10.4% to 14.5% by 2007.
1.12 MARKET SIZE 2
Total banking assets in India touched US$ 1.8 trillion in FY13 and are anticipated to cross US$
28.5 trillion in FY25.Bank deposits have grown at a compound annual growth rate (CAGR) of
21.2 per cent over FY06–13. Total deposits in FY13 were US$ 1,274.3 billion. Total banking
sector credit is anticipated to grow at a CAGR of 18.1 per cent (in terms of INR) to reach US$
2.4 trillion by 2017.In FY14, private sector lenders witnessed discernible growth in credit cards
and personal loan businesses. ICICI Bank witnessed 141.6 per cent growth in personal loan
disbursement in FY14, as per a report by Emkay Global Financial Services. Axis Bank's personal
loan business also rose 49.8 per cent and its credit card business expanded by 31.1 per cent.
2 (Indian Brand Equity Foundation, 2014)
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Figure 2: Growth of Banking Sector Assets in India3
Considering the scale of growth and operations of the Indian Banking Industry, the investment
made by the banking instructions has increase many folds which can be depicted from the
aforementioned options. The percentage growth has been 10% from financial year 2011-12.
1.13 DEFINITION OF A BANK 4
Banking Regulation Act, 1949 defines baking as, “the accepting, for the purpose of lending or
investment, deposits of money from public, repayable on demand or otherwise, and withdrawal
by cheque, draft, order or otherwise”. Banking Company has been defined in the act as “any
company which transacts the business of banking in India”.
1.14 THE ORIGINATION OF THE BANKING INDUSTRY 5
The origins of the banking industry in India go as far back as the 18th century but many of the
early banks promoted by groups of businessmen to finance their trading activities did not survive
long. Joint-stock banks made their entry during the second half of the 19th century and a few of
them, including Allahabad Bank and Punjab National Bank, have survived to this day. So have
several of the banks promoted by the small kingdoms during the first half of the 20th century,
which later came under the control of the Indian government. Foreign banks, including The
Chartered Bank, which came to the country in 1858, and HSBC, which followed in 1867, were
attracted to the increasing trade between India and Britain in the 19th century.
3 (Indian Brand Equity Foundation, 2014)
4 (Beri, 2014)
5 (Beri, 2014)
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Figure 3: Evolution of the Indian Banking Sector 6
The early 19th century also saw the emergence of three large banks, Bank of Bengal, Bank of
Bombay, and the Bank of Madras, named after the three major cities that were the regional
administrative bases of the English East India Company, which ruled most of the country during
that period. Collectively called the presidency banks, they dominated the industry as bankers to
the government, and also functioned as the country‟s central bank. The Imperial Bank of India
was established during the first half of the 20th century by the merger of the presidency banks,
and gave up its role as the central bank only after the Reserve Bank of India was formed by the
British government in 1935. It was subsequently renamed the State Bank of India after India
became free from British rule in 1947.
Interestingly, one of the earliest banking industry crises in India was triggered by the American
Civil War. As cotton supplies to Britain from the U.S. fell sharply after the war started in 1861,
demand for raw cotton exports from India surged. To exploit this opportunity better, some cotton
traders set up banks to finance their export trade. However, as the war ended in 1865 and exports
from the U.S. resumed, demand for Indian cotton also reverted to the levels. Traders who large
inventories and the banks had financed them went bankrupt. At the time of India‟s independence,
almost all major banks except the State Bank of India were privately owned. They remained so
for the next two decades until 1969 when the federal government took control of more than a
6 (Beri, 2014)
Evolutionary Phase (prior
to 1950)
Foundation Phase (50s to
70s)
Expansion Phase (70s to
Mid 80s)
Consolidation Phase (Mid 80
– to 90s)
Reformatory Phase (Since
Liberalization)
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dozen of the largest banks in the country. More than nine-tenths of the banking industry came
under government control after the forced acquisition of private banks continued in 1980. The
industry remained closed to private promoters until the early nineties when the government
decided to issue new banking licenses as part of economic liberalization. Though the entry and
growth of new private banks over the last two decades has transformed Indian banking industry,
the government-controlled banks still dominate. Together they command nearly three-fourths of
the total banking industry assets and an even bigger share of the branch network.
However, the new private banks have been far ahead of the Government controlled banks in
utilizing technology to integrate their network and offer more attractive services. They have also
been more aggressive in exploiting the business opportunities in the financial services space.
Some of the largest private banks in India are now also among the top players in insurance and
asset management. Their strong presence in the fast growing financial services sector has helped
the leading private banks attract far higher equity market valuations, despite their relatively small
balance sheet size.
1.15 CHALLENGES FACED BY BANKING INDUSTRY 7
The Banking Industry of the country is undergoing various changes due to the changing
economic conditions, deregulation, coming up of new private financial institutions, growing
needs and requirements of the customers, etc. This has made the banking industry to face various
challenges.
Competition
In the present world, with the growing needs of the customers, banks provide variety of services
and facilities to the customers. This has led to an increasing competition in the industry. This has
given rise to new challenges for the banks as they need to keep updating their facilities and has to
introduce new services to the customers in order to maintain their loyalty towards the bank.
Deregulation
The growing deregulation provides the banks with greater autonomy, operational flexibility, and
fluctuating interest rate and liberalized norms for foreign exchange. The relaxation in the norms
7 (Manikyam, 2014)
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has attracted new private banks and financial institutions in the market. This has again given rise
to increased competition.
Increased Demands Of The Customers
With the new players entering the market, the demands of the customers are increasing. They
demand from higher interest rates in the form of returns and lesser cost in the form of low
interest charges. The bank thus needs to maintain a marginal level of net interest income in the
form of bank revenue. Banks are also prompted to introduce new product offerings especially in
the retail sector in order to satisfy the demands of the customers.
Diffused Customer Loyalty
Customers today do not stick to one bank. They keep a track of the offerings made in all the
banks. This has made it difficult for the banks to maintain their customer‟s loyalty level. Their
preferences keep on switching between different banks as they are offered different options.
Their demands thus include multiple choices in the products which keep on changing.
Improved Technology
Improved technology in the form of the options like online banking, phone banking, mobile
banking, etc. has increased. Most of the banks today provide such options which are very
customer friendly. These facilities relief the customers from visiting the bank branches and they
are able to carry out all their transactions online. The online facilities provided by the bank also
vary which again tempts the customers. The banks thus today need to keep a track of facilities
provided by the peer banks and offer the best competitive services to the customers in order to
maintain their loyalty.
OTHER MAJOR CHALLENGES
Employee Retention
Global Banking
Development of Rural Market
High Transaction Cost
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1.16 FUNCTIONS OF THE BANK 8
Figure 4: Functions of a Bank
PRIMARY FUNCTIONS OF BANKS
The primary functions of a bank are also known as banking functions. They are the main
functions of a bank. These primary functions of banks are explained below.
1. Accepting Deposits
The bank collects deposits from the public. These deposits can be of different types, such as:
1. Savings Deposits
2. Fixed Deposits
3. Current Deposits
2. Granting Of Loans And Advances
The bank advances loans to the business community and other members of the public. The
rate charged is higher than what it pays on deposits. The difference in the interest rates
(lending rate and the deposit rate) is its profit.
8 (Sadakkadulla, 2013)
Functions of the Bank
Primary Functions
Accepting Deposits
Granting Advances
Secondary Functions
Agency Functions
Utility Functions
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The types of bank loans and advances are:-
1. Overdraft
2. Cash Credit
3. Loans
4. Discounting of Bills of Exchange
SECONDARY FUNCTIONS OF BANKS
The bank performs a number of secondary functions, also called as non-banking functions. These
important secondary functions of banks are explained below.
1. Agency Functions
The bank acts as an agent of its customers. The bank performs a number of agency functions
This includes:
1. Transfer of Funds
2. Collection of Cheques
3. Periodic Payments
4. Portfolio Management
5. Periodic Collections
6. Other Agency Functions (Act as trustees, executors, advisers and administrators on
behalf of the clients)
2. Utility Functions
The bank also performs general utility functions, such as:-
1. Issue of Drafts, Letter of Credits, etc.
2. Locker Facility
3. Underwriting of Shares
4. Dealing in Foreign Exchange
5. Project Reports
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6. Social Welfare Programmes
7. Other Utility Functions (Acts as a referee to financial standing of customers, collects
creditworthiness information about clients of its customers, provides market information
to its customers, provides travellers' cheque facility, etc.
1.2 COMPANY PROFILE: HDFC BANK 9
As part of the Government‟s liberalization of the Indian Banking Industry in 1994, Housing
Development Finance Corporation Limited (HDFC) was amongst the first to receive an „in
principle‟ approval from the Reserve Bank of India (RBI) to set up a bank in the private sector.
The bank was incorporated in August 1994 in the name of „HDFC Bank Limited‟, with its
registered office in Mumbai. HDFC Bank commenced operations as a Scheduled Commercial
Bank in January 1995.
1.21 HDFC BANK’S MISSION IS TO BE A WORLD CLASS INDIAN BANK 10
HDFC Bank‟s business philosophy is based on four core values- Operational Excellence,
Customer Focus, Product Leadership and People. The objective is to build sound customer
franchisees across distinct businesses so as to be the preferred provider of banking services to
target retail and wholesale customer segments, and to achieve healthy growth in profitability,
consistent with the bank‟s risk appetite. The bank is committed to maintain the highest level of
ethical standards, professional integrity, corporate governance and regulatory compliance
1.22 DISTRIBUTION NETWORK 11
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of 2,544
branches spread in 1,399 cities across India. All branches are linked on an online real-time basis.
Customers in over 500 locations are also serviced through Telephone Banking. The Bank's
expansion plans take into account the need to have a presence in all major industrial and
commercial centers where its corporate customers are located as well as the need to build a
strong retail customer base for both deposits and loan products. Being a clearing/settlement bank
9 (About Us: HDFC Bank, 2014)
10 (HDFC Bank Ltd. , 2014)
11 (About Us: HDFC Bank, 2014)
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to various leading stock exchanges, the Bank has branches in the centers where the NSE/BSE has
a strong and active member base.
The Bank also has 9,333 networked ATMs across these cities. Moreover, HDFC Bank's ATM
network can be accessed by all domestic and international Visa/MasterCard, Visa
Electron/Maestro, Plus/Cirrus and American Express Credit/Charge cardholders.
1.23 BUSINESSES 12
HDFC Bank offers a wide range of commercial and transactional banking services and treasury
products to wholesale and retail customers.
Figure 5: Key Business Segments of HDFC Bank
Wholesale Banking Services
The Bank's target market ranges from large, blue-chip manufacturing companies in the Indian
corporate to small & mid-sized corporate and agro-based businesses. For these customers, the
Bank provides a wide range of commercial and transactional banking services, including
working capital finance, trade services, transactional services, cash management, etc. The bank is
also a leading provider of structured solutions, which combine cash management services with
vendor and distributor finance for facilitating superior supply chain management for its corporate
customers. Based on its superior product delivery / service levels and strong customer
orientation, the Bank has made significant inroads into the banking consortia of a number of
leading Indian corporate including multinationals, companies from the domestic business houses
and prime public sector companies. It is recognized as a leading provider of cash management
12
(About Us: HDFC Bank, 2014)
Retail Banking Services
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and transactional banking solutions to corporate customers, mutual funds, stock exchange
members and banks.
Retail Banking Services
The objective of the Retail Bank is to provide its target market customers a full range of financial
products and banking services, giving the customer a one-stop window for all his/her banking
requirements. The products are backed by world-class service and delivered to 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 MasterCard Maestro debit card as well. The Bank is also
one of the leading players in the “merchant acquiring” business with over 90,000 Point-of-sale
(POS) terminals for debit / credit cards acceptance at merchant establishments. The Bank is well
positioned as a leader in various net based B2C opportunities including a wide range of internet
banking services for Fixed Deposits, Loans, Bill Payments, etc.
Treasury
Within this business, the bank has three main product areas - Foreign Exchange and Derivatives,
Local Currency Money Market & Debt Securities, and Equities. With the liberalization of the
financial markets in India, corporate need more sophisticated risk management information,
advice and product structures. These and fine pricing on various treasury products are provided
through the bank's Treasury team. To comply with statutory reserve requirements, the bank is
required to hold 25% of its deposits in government securities. The Treasury business is
responsible for managing the returns and market risk on this investment portfolio.
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1.24 MANAGEMENT 13
Mr. C.M. Vasudev has been appointed as the Chairman of the Bank with effect from 6th July
2010. Mr. Vasudev has been a Director of the Bank since October 2006. A retired IAS officer,
Mr. Vasudev has had an illustrious career in the civil services and has held several key positions
in India and overseas, including Finance Secretary, Government of India, Executive Director,
World Bank and Government nominee on the Boards of many companies in the financial sector.
The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years and
before joining HDFC Bank in 1994 was heading Citibank's operations in Malaysia.
The Bank's Board of Directors is composed of eminent individuals with a wealth of experience
in public policy, administration, industry and commercial banking. Senior executives
representing HDFC are also on the Board.
Senior banking professionals with substantial experience in India and abroad head various
businesses and functions and report to the Managing Director. Given the professional expertise
of the management team and the overall focus on recruiting and retaining the best talent in the
industry, the bank believes that its people are a significant competitive strength.
1.25 TECHNOLOGY 14
HDFC Bank operates in a highly automated environment in terms of information technology and
communication systems. All the bank's branches have online connectivity, which enables the
bank to offer speedy funds transfer facilities to its customers. Multi-branch access is also
provided to retail customers through the branch network and Automated Teller Machines
(ATMs).
The Bank has made substantial efforts and investments in acquiring the best technology available
internationally, to build the infrastructure for a world class bank. The Bank's business is
supported by scalable and robust systems which ensure that their clients always get the finest
services which they offer.
13
(About Us: HDFC Bank, 2014) 14
(About Us: HDFC Bank, 2014)
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The Bank has prioritized its engagement in technology and the internet as one of its key goals
and has already made significant progress in web-enabling its core businesses. In each of its
businesses, the Bank has succeeded in leveraging its market position, expertise and technology to
create a competitive advantage and build market share.
Figure 6: Year-To-Year Market Composition Chart of HDFC Bank 15
15
(HDFC Bank Ltd. , 2014)
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LITERATURE REVIEW
Customer satisfaction is influenced by a number of determinants such as Service Quality,
Perceived Value, Brand Perception, Flexibility, Technological Innovation, Strategic
Endorsement and Functional Performance of the banking service. (Adholiya, Dave, & Adholiya,
2012)
For every organization, customer satisfaction plays vital roles that enhance loyalty and profit.
Earlier all sectors focused on Market Orientation, but now they should focus on Customer
Orientation for their growth in the competitive market. Due to rapid changes in technology and
competition among the banking sectors, it is inevitable for the service organization to study the
impact on customer satisfaction. However, there is no significant relationship between the
demographic variables and customer satisfaction except the choice of the bank and the status of
residential area. (Anand & Selvaraj, 2012)
Customer satisfaction is dependent on nine factors, namely, Traditional Banking Services,
Internet Banking Services, Bank Image Positioning, Customer Convenience, Risk, Bank
Charges, Bank Policies, Bank CRM and Bank Parking Facilities. (Shah, 2012)
Physical characteristics services, technical requirements and investigation of customer`s
complaints have a great impact on customer‟s satisfaction levels in Tejarat bank's branches of
Isfahan. (Kaboli, Fathi, & Azizi, 2011)
Assurance has positive relationship but it has no significant effect on customer satisfaction.
Reliability has negative relationship but it has no significant effect on customer satisfaction.
Tangibles have positive relationship and have significant impact on customer satisfaction.
Empathy has positive relationship but it has no significant effect on customer satisfaction.
Responsiveness has positive relationship but no significant impact on customer satisfaction.
(Munusamy, Chelliah, & Mun, 2010)
New, competitive market conditions, where companies need to fight for their survival, rendered
evident that building and managing relationships with customers is vital. At the basis of every
long term relationship lays the customer satisfaction. In the service area the construct of
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satisfaction is bound to the interactional with the service provider, conferring to the evaluation
even greater importance. (Bena, 2010)
Banks human resources still play a significant role in attracting and maintaining its customers.
Banking Branches and personal contact with employees play a very important role for
prospective customers, despite alternative techniques offered by technology. Banking institutions
need to re-examine their customer-approach methods and apply the marketing of relationships to
ensure loyalty. (Mylonakis, 2009)
There is a significant variation in the level of satisfaction among internet banking users. The
satisfaction of an Internet banking user depends upon facilities availed by customers and
awareness about internet banking. The banks must provide information about new up-dated
technological services introduced by them to the customer time to time to improve the overall
satisfaction of customers. (Kathirvel & Karpagavalli, 2014)
Customer satisfaction is imperative for long term success of any organization. More the
competition, higher is the necessity to keep the customers satisfied. Also, they determined certain
dimensions that might affect customer satisfaction level. (Mandal & Bhattacharya, 2013)
A satisfied customer will be very enthusiastic while talking about his/her experience with the
service availed by him/her and with the organization as whole. This action will act as an add-on
and further lead to positive marketing of the respective organization. (Dawar, 2013)
Customer‟s concerns about security, authenticity and reliability of the technology are of
significance in determining the levels of customer satisfaction. The results imply that firms
should focus upon IT application, innovative services, security, customer trust and risk as these
are the key indicators of technology adoption. (Saleem & Rashid, 2011)
Fierce competition, more demanding customers and the changing climate have presented an
unparalleled set of challenges for banks in the country. Therefore, customer satisfaction is the
key for many banks to survive in competition. (Mistry, 2013)
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Major factors such as service quality, brand perception and perceived value affect customer‟s
Satisfaction levels in E-banking settings. This study also evaluates influence of service quality on
brand perception, perceived value and satisfaction in e-banking. (Kumbhar, 2011)
Service quality is affected by various variables, namely, security, communication, tangibility,
credibility, reliability, accessibility, competency, courtesy, responsiveness and understanding. He
argued that for any organization falling under the service sector, it is inevitable to incorporate the
aforementioned variables in order to drive the organization towards success. (Parasuraman,
Berry, & Zeithaml, 1988)
Offering quality service has positive impact on overall customer satisfaction. Empathy and
responsiveness plays the most important role in customer satisfaction level followed by
tangibility, assurance, and finally the bank reliability. Offering high quality service increase
customer satisfaction, this in turn leads to high level of customer commitment and loyalty.
(Shanka, 2012)
Service quality systems, customer satisfaction, response to customers and loyalty to employees
are the most important factors that affect the degree of success of failure in any banking
organization. (Gazor, Nemati, & Ehsani, 2012)
Service quality has the most influence on bank customers‟ satisfaction compared to value and
corporate image. The results also provide support for the moderating effect of value on the
relationship between service quality and customer satisfaction, and the moderating effect of
corporate image on the relationship between the service quality dimensions identified in this
study and service quality. Demographic variables (Age, income, and occupation) are also
significant in explaining bank customers‟ satisfaction in the NZ banking sector. (Gan, Clemes, &
Wei, 2011)
Five service quality dimensions namely reliability, responsiveness, assurance, empathy, and
tangibles have been established based on the SERVQUAL model, that influence customer
satisfaction and these form the core service quality dimensions. Reliability, responsiveness and
assurance have more contribution to satisfy the customers. (Mawa, 2010)
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There exists wide perceptual difference among Indian (public sector) banks regarding overall
service quality with their respective customers, when compared to Private sector banks. Whereas
the said perceptual difference in private banks is narrow. The service quality model developed by
Zeithamal, Parsuraman and Berry (1988) was used in the present study. (Agarwal, 2012)
Customer loyalty is a direct outcome of customer satisfaction and that both of the
aforementioned aspects go hand in hand. No organization in the banking industry can consider
achieving customer loyalty without establishing customer satisfaction amongst its customers.
(Chavan & Ahmad, 2013)
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OBJECTIVES OF THE STUDY
The objectives of the study can be described as follows:-
1. To determine the satisfaction level amongst the customers of HDFC Bank
2. To identify strong and weak points of HDFC bank that would need to be sustained and
those that need to be developed or improved
RESEARCH METHODOLOGY
The respective research study is an amalgamation of both primary and secondary data. The
primary data was gathered through a comprehensive survey over 50 respondents by the means of
a structured questionnaire, which was administered to the respondents to be filled up manually.
A convenience sampling technique was employed to gather the aforementioned required data.
The secondary data used in this research paper was picked up from the official website of HDFC
bank (www.hdfcbank.com) and few other authentic and reliable sources.
SAMPLE SIZE
A sample size of 50 respondents was exposed to the survey.
SAMPLING INSTRUMENT
A structured questionnaire was used as the sampling instrument to capture the comebacks of the
respondents and draw meaningful conclusions out of it.
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RESEARCH ANALYSIS
Chart 1: Educational Qualification of the Respondents
Interpretation: Out of the total sample size of 50, it was found that a majority of 26 respondents
(52%) were graduates and 23 respondents (46%) were through with their post-graduation. This
shows that the sample that was selected for the survey were educated enough to be eligible for
undergoing this study since they have reasonable bit of knowledge regarding retail banking
services. Merely, 1 respondent (2%) had educational qualification up to higher-secondary. None
of the respondents who were exposed to this study possessed a PHD degree.
Chart 2: Annual Income of the Respondents
Interpretation: The aforementioned chart shows that 12 respondents (24%) had annual income
level below 1 lakh rupees per year, 8 respondents (16%) had annual income between 1-5 lakhs,
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13 respondents (26%) had annual income between 5-10 lakhs, 7 respondents (14%) had annual
income between 10-15 lakhs, 2 respondents (4%) had annual income between 15-20 lakhs and 8
respondents (16%) had annual income above 20 lakhs.
Chart 3: Banking Experience of the Respondents with HDFC Bank
Interpretation: The aforementioned chart shows that a majority of 23 respondents (46%) have
been using the retail banking services of HDFC bank for more than 5 years and 21 respondents
(42%) have been using the services for 1-3 years now. From this it can be inferred that the
sample that was exposed to this study have spent quite some time using the banks services which
now makes them fit to undergo a research study aimed at determining the consumer satisfaction
level. Only 6 respondents (12%) fall within the brackets of respondents who have retail banking
experience of less than 1 year.
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Table 1: Customer Satisfaction Level With Reference To Managing Of Accounts by HDFC
Bank
Interpretation: The aforementioned graph shows that in context to managing of personal
accounts by the bank, a majority of 29 respondents (58%) were satisfied with the way the bank
currently manages their personal accounts. 11 respondents (22%) were highly-satisfied by the
same. A minority of 10 respondents (20%) had neutral feelings about it. However, none of the
respondents seemed to bare negative opinion regarding the way bank manages their accounts,
which is a good indication for the bank.
Table 2: Customer Satisfaction Level With Reference To Handling of Quarries by HDFC
Bank
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Interpretation: The aforementioned graph shows that in context to the quarry handling and
resolving mechanism employed by the bank, 23 respondents (46%) seem to be satisfied with the
approach. 18 respondents (36%) of the respondents had mixed opinion about the process, owing
to which they took a neutral stand. However, 9 respondents (18%) seemed highly satisfied with
the quarry handling and resolving methods and techniques adopted by the firm. None of the
respondents replied negatively to this which shows that the customers bare a positive sentiment
regarding the firm.
Table 3: Customer Satisfaction Level With Reference To Customer Service
Representatives of HDFC Bank
Interpretation: The aforementioned graph shows that with reference to the customer service
representatives of the, a majority of 36 respondents (72%) were satisfied with the customer
service representatives. A nominal figure of 6 respondents (12%) seemed highly satisfied with
the same. Out of all, 7 respondents (14%) preferred not to make a directional comment, thus
taking neutral grounds. None of the customers seemed dis-satisfied in context to customer
service representatives of the firm.
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Table 4: Customer Satisfaction Level With Reference To Top Level Management of HDFC
Bank
Interpretation: The aforementioned graph shows that in context to the top level management of
the bank, 27 respondents (54%) seemed to carry a positive image thus falling in the category of
satisfied customers. A mere 4 respondents (8%) were highly satisfied with the same. 19
respondents (38%) had a neutral feeling about it. However, none of the respondents replied
negatively, posing a good image of the firm in the retail banking sector.
Table 5: Customer Satisfaction Level With Reference To Branch Facilities of HDFC Bank
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Interpretation: The aforementioned graph shows that with reference to the facilities and
conveniences available at the branches of HDFC bank, 23 respondents (46%) seemed satisfied
with the current status. A great proportion of 18 respondents (36%) were highly satisfied with the
amenities found at the branches. 9 respondents (18%) had mixed feeling regarding the same. In
addition to it, none of the customers felt dis-satisfied with the facilities made available by the
firm at its branches.
Table 6: Customer Satisfaction Level With Reference To Documentation Provided by
HDCF Bank
Interpretation: The aforementioned graph shows that with reference to the statements and
documentations provided by the bank, a reasonable high figure of 34 respondents (68%) seemed
satisfied with the procedures and protocols followed by the firm in these context. 12 respondents
(24%) were highly satisfied and 4 respondents (8%) had neutral opinion to it. None of the
customers had negative opinions in relation to this aspect.
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Table 7: Customer Satisfaction Level With Reference To Telephone Enquiry Entertained
by HDFC Bank
Interpretation: The aforementioned graph shows that in context to the telephonic enquiries
entertained by the bank, 28 respondents (56%) were satisfied with the way the telephonic
conversations went with the firm‟s representatives. 10 representatives (20%) were highly
satisfied and 11 respondents (22%) had neutral opinions. None of the customers had any
negative thoughts about the same.
Table 8: Customer Satisfaction Level With Reference To Safety Offered by HDFC Bank
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Interpretation: The aforementioned graph shows that with reference to safety and security
offered by the bank to its customers, 29 respondents (58%) were satisfied with the degree of
safety and security. 8 respondents (16%) were highly satisfied and 13 respondents (26%) held a
neutral opinion about the same. None of the respondents had any complaints regarding the safety
and security of the bank which offers it an edge over is competitors.
Table 9: Customer Satisfaction Level With Reference To Reliability Offered by HDFC
Bank
Interpretation: The aforementioned graph shows that with reference to the reliability factor at
the HDFC bank, a major chunk of 32 respondents (64%) were satisfied with the reliability on
the bank. 8 respondents (16%) were highly satisfied and 10 respondents (20%) stood by neutral
grounds. None of the customers had any complaint or dis-satisfaction relating to the reliability at
the HDFC bank.
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Table 10: Customer Satisfaction Level With Reference To Accessibility of HDFC Bank
Interpretation: The aforementioned graph shows that with reference to the accessibility factor
at the HDFC bank, a major chunk of 30 respondents (60%) were satisfied with the reliability on
the bank. 9 respondents (18%) were highly satisfied and 11 respondents (22%) stood by neutral
grounds. None of the customers had any complaint or dis-satisfaction relating to the accessibility
of the HDFC bank.
Table 11: Customer Satisfaction Level With Reference To the Degree Courteous Behaviour
at HDFC Bank
Interpretation: The aforementioned graph shows that with reference to the courteous behaviour
at the HDFC bank, a major chunk of 29 respondents (58%) were satisfied with the reliability on
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the bank. 15 respondents (30%) were highly satisfied and 6 respondents (12%) stood by neutral
grounds. None of the customers had any complaint or dis-satisfaction relating to the same at the
HDFC bank.
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SUMMARY OF RESULTS
From the aforementioned graph it can be concluded that the HDFC Bank has performed
exceptionally well in terms of Branch Facilities and Documentation Process as the firm scores
really high. Factors such as Managing of Accounts, Telephone Enquiries, Reliability and
Accessibility fall under the mediocre range. The firm can surely leverage upon these traits.
However, Quarry Handling, Top Level Management form the weak links, upon which the
company needs to, work really hard.
STRENGTHS – BRANCH FACILITIES, DOCUMNETATION PROCESS, MANAGING
ACCOUNTS, TELEPHONE ENQUIRY
WEEKNESSES – QUARRY HANDLING, TOP LEVEL ANAGEMENT, CS
REPRESENTATIVES
OPPORTUNITIES – SAFETY & SECURITY, RELIABILITY, ACCESSIBILITY,
3.4
3.5
3.6
3.7
3.8
3.9
4
4.1
4.2
4.3
Overall Satisfaction Level
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CONCLUSION
HDFC Bank, one of the premiums banking institution in India, tops the charts in the retail
banking sector. The firm not only performs outstandingly well in offering above average returns
to its investors, but also ensures high level of satisfaction amongst its customers. Various factors
such Safety, Reliability, Communication and Customer Interaction, Top Level Management etc.
contribute towards customer satisfaction. It is very essential for an intuition such as HDFC bank,
operating is such a competitive and dynamic environment, to acknowledge and recognize the
importance of customer satisfaction at organisational level and work towards it. From the
aforementioned analysis it can be inferred that the bank has been performing well at all fronts
since the level of customer satisfaction is reasonable high amongst them. The firm has keenly
focused on all aspects that might directly or indirectly have an impact on the level of satisfaction
amongst its customers and have left no stones unturned. Starting right from the most basic and
fundamental functions such as account handling, telephonic enquiries, documentation and branch
facilities, the firm ensures that the degree of satisfaction is not only met in these aspects but also
in terms of the other value added services such as reliability, accessibility, safety etc. With such
as approach, it can be said that if the firm continues on this trail, it will definitely have a very
bright foreseeable future ahead.
FUTURE SCOPE OF THE STUDY
The outputs and data that can be drawn from this research will be of possible empirical
contribution to the area of consumer satisfaction in retail banking services. It will try to link the
relationship, if any, of the customer satisfaction level and the possible measure of success of the
firm.
Also, using the data of this survey, factor analysis can be employed on a multi-dimensional scale
to discover that factors that contribute towards customer satisfaction in retail banking sector. In
addition to it, the factors can be ranked on the basis of their importance, to come up with the
most desirable factors or characteristics required in banking sector.
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LIMITATIONS OF THE STUDY
A sample size of just 50 respondents was surveyed for this research study which may fail
to capture the response of the masses.
Biases while responding to the questions by the respondents may pose a potential
problem.
The survey data may not be able to capture the response of the participants to the utmost
degree.
Maintaining the authenticity and integrity of the data and used in the survey is always a
challenge.
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ANNEXURES
Dear Sir/Madam,
I, Krishna Kedia, am pursuing my MBA from Auro University, Surat under my guide Ms. Jyoti
Chandwani. I seek your cooperation for my research work, by filling the questionnaire. The title
of my study is “Customer Satisfaction in Retail Banking Sector: with reference to HDFC
Bank”. Your feedback will help me understand the topic in detail & provide true results of the
study.
Thank you very much for your cooperation.
QUESTIONNAIRE ON CUSTOMER SATISFACTION IN RETAIL BANKING
SECTOR:
With Reference To HDFC Bank, Surat
1) Name (Optional): …………………
2) Educational Qualification:
(a) Higher Secondary [ ]
(b) Graduate [ ]
(c) Post Graduate [ ]
(d) PHD and above [ ]
3) Occupation (Optional): …………………
4) Annual Income:
(a) Less than 2 lakhs [ ]
(b) 2 – 4 lakhs [ ]
(c) 4-6 lakhs [ ]
(d) 6 – 8 lakhs [ ]
(e) 8 – 10 lakhs [ ]
(f) 10 lakhs and above [ ]
5) For the past how many years are you using the bank‟s services?
(a) Less than 1 year [ ]
(b) 1 – 3 years [ ]
(c) 3 – 5 years [ ]
(d) more than 5 years [ ]
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The following section is related to some of the specific questions on the bank‟s services
MANAGING ACCOUNT
6) How satisfied are you with the way the bank:
1 2 3 4 5
Handles your account
sRectifies the mistakes, if any
Explains charges clearly
HANDLING QUERIES
7) How satisfied are you with:
1 2 3 4 5
The time taken by members of staff to
answer the telephone
The way in which staff members answer your
call
The clarity with which he staff member's
handle the quarry
The ease of reaching the person you need to
speak with
How quickly your enquiry was understood
and responded to
CUSTOMER SERVICE REPRESENTATIVES
8) In terms of the service you received from the customer service representatives/tellers, how
satisfied are you with the following
1 2 3 4 5
Friendly and courteous manner
Knowledge of bank's products & Services
Willingness to listen and respond to your
need
Fast and efficient service
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Professional and attractive appearance and
Willingness to listen and respond to your
need
Recognition of you as valued customer
SUPERVISORS / MANAGEMENT
9) In terms of the service you received from the Supervisors and Management of the branch,
how satisfied were you with the following?
1 2 3 4 5
Friendly and courteous manner
Knowledge of bank's products & Services
Willingness to listen and respond to your
need
Fast and efficient service
Professional and attractive appearance &
Willingness to listen and respond to your
need
Recognition of you as valued customer
Available to customers when needed
10) BRANCH FACILITIES
1 2 3 4 5
Clean & well cared facilities
Efficient, no wait service
No long line ups at counter
Availability of information brochures
Pleasant & attractive décor
Automatic bank machines in convenient
locations
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STATEMENTS AND DOCUMENTATIONS
11) In terms of your expectations regarding mailed statements, please indicate your
satisfaction with the following:
1 2 3 4 5
Sent out reliably and on time
Complete record of transactions
Accurate
Easy to read and understand
TELEPHONE ENQUIRIES
12) In terms of the service you expected from the telephone contact, please rate the following
criteria:
1 2 3 4 5
Call handled promptly, not kept on hold
Courteous and professional manner
Quickly connected to the right person
Question or problem handled to your
satisfaction
OVERALL SATISFACTOIN LEVEL
13) In context to HDFC bank, please rate the following criteria:
1 2 3 4 5
Security (Account, ATM,
Privacy Security)
Communication (Email,
Telephonic, Live Chat,
Call Centers etc.)
Reliability (Security,
Services Offered,
Information dissemination)
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Accessibility (Physically,
Telephonically, Virtual
etc.)
Competency ( Account
Handling and Problem
Solving)
Courtesy ( Behavior of
bank staff with the clients)