TABLE OF CONTENTS

INTRODUCTION ...................................................................................................... 1 CHAPTER 1- CONCEPTUAL FRAMEWORK .................................................... 3 1.1. Service quality.................................................................................................. 3 1.2. Measurement of service quality ..................................................................... 4 Multi- attribute concept ........................................................................................ 4 Review of Nordic Model ...................................................................................... 4 Review of Servqual model ................................................................................... 5 Review of Servperf model .................................................................................... 5 Review of Kano model ......................................................................................... 5 1.3. Suggested model .............................................................................................. 6 1.4. Previous research ............................................................................................ 6 Previous research outside Vietnam....................................................................... 6 Previous research in Vietnam ............................................................................... 7 CHAPTER 2- RESEARCH METHODOLOGY AND OVERVIEW ON VIETINBANK ............................................................................................................ 8 CHAPTER 3. FINDINGS AND ANALYSIS ..................................................... 10 3.1.Customer satisfaction on Vietinbanks card ................................................. 11 3.2.Comparison between customers satisfaction toward each service attribute and the overall satisfaction level ........................................................................ 13 3.3.Comparison of Vietinbanks and other banks card service quality ............ 16 CHAPTER 4- CONCLUSIONS AND RECOMMENDATIONS ........................ 21 4.1. Conclusions .................................................................................................... 21 4.2. Recommendations ......................................................................................... 21 Suggestions to improving debit card service quality .......................................... 21 Suggestions for Vietinbank to improving credit card service quality ............. 22 Suggested action plan for Vietinbank to improve card service quality in the next two years ....................................................................................................... 24 i

ii

CUSTOMER SATISFACTION ASSESSMENT ON VIETINBANKS CARD SERVICE QUALITY DO THI THEM NGOC MBA candidate, 2007-2009 School of Business Vietnam National University, Ha Noi Supervisor: Dr Vu Anh Dung Ha Nguyen, MBA

INTRODUCTION
Problem identification Retail banking services especially bank card services are increasingly popular in daily life (Hue, 2010). Most of banks in over the world develop retail services having remarkable contributions to their revenue and profit. Nowadays, banks not only concentrate on traditional service including deposit, loan and letter of credit but also develop value added services such as card, internet and mobile banking. These services have been becoming really important because they created differentiation among banks. Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) is one of three biggest banks in Vietnam in terms of capital and revenue. Up to now, the card service has been provided by Vietinbank for 17 years and paid attention in its business strategy in coming time. However, Vietkinbank has never measured customer satisfaction even though data collected by the Service Department of Card Centre showed that many customers complained about poor services and expected quality improvement. In order to better serve customer, Vietinbank need to assess customer satisfaction and look for the opportunity to improve card service quality. Objectives Study on the models used to measure service quality and customer satisfaction and choose the most suitable one to analysis. Attempt to apply the selected model to measure customer satisfaction of Vietinbank card services in comparison with other banks.

 Draw conclusions and make recommendations on what Vietinbank should do to increase customer satisfaction toward its card services. Research questions Which service quality model should be used to measure customer satisfaction toward bank card service? What are dimensions of bank card service quality? How are Vietinbanks customers satisfied with card service quality? What should Vietinbank do to improve its card service quality? Research Scope The research focuses on Vietinbank card service quality. The survey is conducted from January to June, 2011 in Hanoi. Comments are given to Vietinbank up to 2020. Data resources - Secondary data from annual reports of Vietinbank and other organizations, magazines, newspapers and previous researches. - Primary data from a survey with customers. Method The research is based on the quantitative and qualitative method with questionnaire delivery and in- dept interview techniques to collect data. Quantitative data is process by SPSS software. Qualitative data is processed by NVIVO principle. Significance The study contributes to completing framework of customer satisfaction measurement on bank card service quality. It also analyzes the current quality level of Vietinbanks card service quality and recommends solutions for improvement. Research result The research result suggests the most suitable model to assess customer satisfaction in bank card service quality. It also recommends what Vietinbank should do to improve customer satisfaction toward its card service. Limitations The sample size is 121 observations in Hanoi. If the sample size is larger, the result would be better. Besides, the convenient sampling method is used. If the author used another method, the result would be better. 2

Structure of the research report Regardless of the introduction, references and appendices, the thesis has four major parts as followings: Chapter 1: Conceptual framework Chapter 2: Research methodology and overview on VietinBank Chapter 3: Findings and analysis Chapter 4: Conclusions and recommendations

CHAPTER 1- CONCEPTUAL FRAMEWORK 1.1. Service quality

There are many definitions on service. Among them, the concept by ISO seems to be popular. According to it, services are set of activities between customers and providers and within provider to satisfy customers demand. Services are different from products because of its components. They are derived from four components including customers, facilities, enclosed products and service providers. Services have also some remarkable characteristics in comparison with goods. They are intangible, inseparable, heterogeneous, un-stored and difficult to measure (Phan, 1999). Gurus on quality gave many quality definitions. So far, there are several principal approaches on quality: the transcendent, product-based, user based, manufacturing based, value-based, competitiveness based, and ISOs concept, the most popularly used. By ISOs view, quality is the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs. Service quality is more difficult for customer to evaluate than product quality. Customer may assess service quality in different ways from how they perceive product quality. Since service quality depends on not only the result but also the process and customer

perception, there are two thoughts of assessing service quality. One is evaluating the gap between perception and expectation. The other focuses on perception only. There are also some ways of identifying service attributes. Among them, RATER model which was developed by Zeitham and colleagues in 1992 seem to be popular. According to this service quality can be evaluated based on five dimensions including reliability, assurance, tangible, empathy and responsiveness (Table 1.2). Table 1.2- Service attributes Exhibition Ability to perform the service dependably and accurately Employees knowledge and courtesy and their ability to inspire trust and confidence Tangibles T Empathy E Responsiveness R Appearance of physical facilities, equipment, personnel and communication materials Caring, individualized attention given to customers Willingness to help customers, provide prompt service and solve problems
Source: Zeitham at. Al., 1992

Attributes Reliability R Assurance A

1.2. Measurement of service quality Multi- attribute concept

The multi- attribute concept about service states that a service can be viewed as a bundle of benefits and costs . Whenever anyone would like to consider and examine a service or product, he or she can focus its attributes (Wilkie and Pessemier, 1973). According to this model, a service will be divided into many attributes. Based on customer perception about each attribute, the measurement will be conducted. By doing that way, researcher could understand deeper the construct of quality then know how to improve the quality perception of customer by improving each attribute performance.

Review of Nordic Model

In 1984, Gronroos developed the Nordic conceptualization of service quality. It examined how technical quality and functional quality affect the expected and perceived

service quality of a service encounter. While, this investigation only provides preliminary support for the role of technical quality in the formation of overall quality evaluations, subsequent investigations empirically confirm its effects in the formation of service quality perceptions. Technical quality is operationally defined as what the customer is left with when the production process is finished.

Review of Servqual model

The concept of Servqual model is generally based on gap theory of Parasuraman, Zeithaml, and Berry (1985), which suggests that the difference between customers assessment of the actual performance of a specific firm within a general class of service providers and their expectation about the performance of that class (P-E gap) drives the perception of service quality. Servqual instrument consists of 22 attributes which can be classified into 5 dimensions: tangible, reliability, responsiveness, assurance, and empathy (Parasuraman, Berry, and Zeithaml, 1988), also known as RATER. Reliability reflects the consistency and dependability of a firms performance; Assurance addresses the competence of a firm, the courtesy it extends to its customers, and the security of the service; Tangibility refers to the tangible evidence that surrounds the service in forming evaluation; Empathy is ability of the firms personnel to experience customers feeling as their own and Responsiveness reflects the commitment of a firm to provide its service in a timely manner. Servqual questionnaire includes 22 pairs of question about 22 attributes as presented above.

Review of Servperf model

According to Cronin and Taylor in 1992, service quality in this case is equal to customer perception of service attributes, also known as SERVPERF model. RATER is still used to develop a system of criteria to measure service quality. The higher the level of customer perception of service attributes, the higher the service quality. The Servperf model implies that service provider should maximize customer perception of service attributes.

Review of Kano model

Quality is defined as the totality of quality characteristics or level of performance that 5

determines whether a product or service satisfies the purpose of use (Kano, 1996, p.114). Quality concept is divided into 2 components, performance and satisfaction. Having more meaning than quality definition in Servqual, this definition does not stop at performance measure (performance is not a benefits related factor) but it goes further, this performance must contribute to customer satisfaction in order to be defined as quality. This definition links quality concept with customer benefits. According to this model, service attributes can be classified into basic needs, performance needs and excitement needs.

1.3. Suggested model

The study uses Servperf model to assess service quality of Vietinbanks card service quality. Although there are some researches about bank card service in Vietnam, to the author, there has been no one studying on this subject so far.

1.4. Previous research Previous research outside Vietnam

In 1997, in working paper Efficiency, profitability and Quality of banking service, Andreas Soteriou and Stavros A. Zenios coming from The Wharton School, University of Pennsylvania, developed general framework for combining strategic benchmarking with efficiency benchmarking of services offered by bank branches. Bahia and Nantel in 2000 anounced their research results on Bank service quality model. After sampling 115 banking customers in Canada, they came out with Bank service quality model comprising of 31 items, with six dimensions. Some criteria such as staffs qualification and empathy and meeting special needs of customers, etc. those are important to evaluation of bank service quality have not been mentioned in this model. In working paper Measuring service quality of bank: Scale development and validation, which was published in Journal of Retailing and Consumer Services Vol 12 (2005), Osman M. Karatepea, and colleagues including Ugur Yavasb and Emin Babakusc developed to test a service quality instrument by using the retail banking services in Northern Cyprus as a case in point. 6

In 2006, Najjar and colleagues from University of Nebraska, Omaha; University of Nebraska, Lincoln announced their research result in the paper Service Quality: A case study of bank. In this report, the authors focused on the important of improving service quality in banking industry and develop questionnaire to identify underlying dimensions of bank quality and to assess customers' perceptions of the importance of service dimensions. In 2007, in the Journal of Money, Credit and Banking, Vol. 39, No. 1 ( February, 2007) of the Ohio State University, A Dick, an economist at the Federal Reserve Bank of New York announced his research study in the paper Market size, Service quality and Competition in Banking. Dr. T. Vanniarajan and B. Anbazhagan in 2007 present their study Servperf analysis of retails banking. In 2009, Usha Lenka and colleagues including Damodar Suar and Pratap K.J. Mohapatra announced their research result in Journal of Entrepreneurship March 2009 vol. 18 no. 1 47-64 in the working paper Service Quality, Customer Satisfaction, and Customer Loyalty in Indian Commercial Banks.

Previous research in Vietnam

In Vietnam, banks have not paid attention to survey on customer satisfaction very much. In addition to that, SERVPERF model has just been mentioned in several researches so far. In 2006, Nguyen Thanh Long presented his research on Using SERVPER model to assess training programs quality in An Giang University. The result of the survey showed that students satisfaction is depended on lecturer, infrastructure, and students trust on university. In 2007, Le Phuoc Luong proposed his idea on Using SERVPERF to measure students satisfaction in training through a small research. In this research, service components including infrastructure, lecturer, university staff, and training program are evaluated by students. The author came in to conclusion that SERVPERF can be used to measure quality of training program.

In 2007, Nguyen Khanh Linh announced her research on report Improvement of card service of Agribank in Vietnam. After evaluating card service quality of Agribank, she proposed some solutions for the Bank as training employee and restructuring service processes. In 2009, Nguyen Thi Phuong Tram from Ho Chi Minh City University of Economics successfully defended her master thesis Improvement of e- banking service: Comparison of SERVEQUAL and GRONROOS. After conducting framework to evaluate service quality of e-banking service under SERVEQUAL and GRONROOS model, the author applied models to measure e-banking service quality of e- banking. The comparison of results of the two models was made. Finally, the author came up with the factors affecting e-banking service quality and solutions to improvement of quality. In 2010, in a very short article on website of Bank Association of Vietnam, Nguyen Huu Bieu proposed to use 5- gap model to measure the service quality of banks in Vietnam and Deming circle (PDCA) to improve service quality. However, this is a very short article without any practical research. The above information shows that so far, there has not been any research on customer satisfaction assessment on VietinBanks card service quality. This paper, hopefully, could contribute to completion of theory on customer satisfaction assessment on bank card service quality.

CHAPTER 2- RESEARCH METHODOLOGY AND OVERVIEW ON VIETINBANK

2.1 Research methodology Secondary data research was conducted to find who use Vietinbank Card services. Primary data research was conducted to find services customers have used and their assessment on service quality. The convenient sampling method was used with three set of questionnaires, one quantitative for customers, one qualitative for customers and one qualitative for Vietinbanks employees.

The pilot was conducted with 5 customers and 2 Vietinbank employees. Service indicators are identified as in Table 2.1. The quantitative survey was completed with 121 observations. The qualitative was done with 5 customers and 5 Vietinbank employees. Table 2.1- Measurements of indicators Attribute Indicator Reliability Cash withdraw limitation per day Cash withdraw limitation per time Wide transaction system Accurate transaction including amount of money, information on the bill, instruction on the ATM screen Billing payment for various services telecoms, electrics, railway ticket, airlines ticket and so on Acceptance for payment on many websites High security for internet transaction Foreigner currencies Topup for mobile phone account SMS banking Termed deposit at ATM Reasonable service fees Simple procedure Assurance Tellers have deep knowledge Tellers have good attitude Tellers are supportive Tangibles Good ATM screen Plentiful card design Clear information on ATM billing Empathy Take care of customers Responsive Response for customers requirements and complaints quickly Source: Conducted by the author The questionnaire delivery and collection were completed by direct sales staffs. Statistical Package for Social Sciences (SPSS) was used to analyze the collected first two data sets. Firstly, descriptive statistics were calculated for all variables to have a general screening on the real data set in terms of frequency, means, variances, etc. This step also helps to detect any mistake of data entry. Then, the data sets were processed to give information on their evaluation of service quality. Grouping these results into each measurement as done previously will give us an overview on the bank card service quality.

NVIVO principle was used to process qualitative data. According to this principle, ideas are coded basing on key words and then all ideas about each keyword are grouping. The qualitative questionnaire for customers and employees of Vietinbank have the same contents to the quantitative questionnaire. However, ways to express questions are different. For example, in quantitative one, likert scale is used to captured respondents ideas whereas semi- structured interview is used to collect respondents opinions. 2.2. Overview on VietinBank At this moment, Vietinbank is high ranking base on variety of added services as well as rich product lines. Its market share is presented in the below figures. Figure 2.1,2.2- Debit card market share and international card in Vietnam, 2010

Others 33.79%

Vietinbank 19.62%
Sacombank 6.25%

Others 12.74%

Vietinbank 29.56%

Vietcombank 18.11% BIDV 8.29% Agribank 20.19%

ACB 12.48% Agribank 2.25% Vietcombank 36.72%

Source: Vietnam bank card associate

CHAPTER 3. FINDINGS AND ANALYSIS

Most of the respondents use bank card service of Vietinbank. 90.1% of respondents use ATM Vietinbank card. Vietinbank credit card was chosen by 25.6% of respondents. 26.4% revealed that they use card service of other banks such as Vietcombank, Agribank, BIDV, Techcombank and Dong A bank. Wide transaction system is the most important factor to choose bank card service. Simple procedure is the second important factor. The last three factors are reasonable service fee, plenty of value added service, and banks brand name, in turn.

10

3.1.Customer satisfaction on Vietinbanks card

Customers perception toward quality of Vietinbank card service is illustrated in figure 3.7. In this figure, indicators are in ascending rank by sum of very satisfied and very satisfied level. Figure 3.7- Customer satisfaction on Vietinbank card service ranking by satisfaction level
tellers have good attitude transaction security acceptance payment for various websites termed deposite at ATM tellers have deep knowledge short processing time simple procedure accurate transaction on ATM sms banking service fee accurate transaction nice design of bill vn topup service remittances receiving instruction information easy to understand cash withdraw limitation per day payment for various services wide transaction system nice card design cash withdraw limitation per time instruction on ATM screen nice design of ATM screen 0% very dissatisfied dissatisfied 20% neutral 40% 60% 80% 100%

satisfied very satisfied %

11

Mistake seems to quite often occur with Vietinbank card service. The figure 3.9 presents this statement. According to result of the survey, one third of respondents revealed they had trouble in transaction so far (figure 3.9). Among them, less than 20% are satisfied with solving problem by Vietinbank on solving cost, time and attitude of customer care employees. Problem solving time seems to be the most factor that makes customers dissatisfied. 32.5% of respondents those faced problems in transaction revealed they are not satisfied as the long solving time. Figure 3.9- Trouble in transaction

have trouble in transaction 33.1%

do not have trouble in transaction 66.9%

Very few are very satisfied with the service quality of Vietinbank card. More than half of the respondents measured card service quality of Vietinbank as on average. They are neutral between feeling satisfied and dissatisfied. The service quality is acceptable but does not impress customers. Figure 3.11- Customer satisfaction of Vietinbank card
very satisfied 1.7% satisfied 39.7% neutral 56.1% dissatisfied 2.5%

12

3.2.Comparison between customers satisfaction toward each service attribute and the overall satisfaction level
The below table shows the details of customers evaluation of Vietinbank service quality. Each indicator is represented by a mean given by customers. The average score of each attribute is created by taking average of all indicators in each dimension. Table 3.1- Customer satisfaction on Vietinbanks card service quality Attribute Indicator Average score Reliability 14 indicators AS: 3.105 Cash withdraw limitation per day Cash withdraw limitation per time Wide transaction system Accurate transaction including amount of money, information on the bill Instruction on the ATM screen Billing payment for various services telecoms, electrics, railway ticket, airlines ticket and so on Acceptance for payment on many websites High security for internet transaction Foreigner currencies Topup for mobile phone account SMS banking Termed deposit at ATM Reasonable service fees Simple procedure Assurance 3 indicators Tellers have deep knowledge Tellers have good attitude 2.474 3.174 3.061 2.659 3.344 3.302 3.088 3.212 4.04 4.221 3.304 2.720 3.235 3.167 3.310 3.426

13

Attribute

Indicator

Average score

AS: 3.871 Tangibles 3 indicators AS: 3.240 Empathy 1 indicator S: 3.253 Responsiveness 1 indicator S: 3.307 Satisfaction level

Tellers are supportive Good ATM screen Plentiful card design Clear information on ATM billing Take care of customers

3.354 3.250 3.167 3.304 3.253

Response

for

customers

requirements

and

3.307

complaints quickly

The overall satisfaction given by respondents

3.405

Source: survey result

The comparison of customers satisfaction toward each service attribute and the overall satisfaction level is made in the next figure. Average score of each dimension is presented in Spider chat of Vietinbanks card service quality. Figure 3.12- Spider chart of Vietinbanks card service quality

14

Source: survey result Regarding to the above chart, assurance was given the highest score of 3.871. Many respondents agreed with the statement that tellers have good knowledge and attitude. It is a good for Vietinbank since for any service, staffs are important in sharpening the evaluation of service quality by customers. The lowest score is give in attribute reliability. There are some reasons for giving low score in this dimension. Firstly, customers are not so satisfied with the cash withdrawal limitation per time. According to them, more cash should be allowed to withdraw per time. Secondly, card should be allowed to pay for various services and in various websites. Some customers complained though interview that they faced to the problem of not allowing to pay in the service they are interested. The 4 dimensions are at the average score, from 3.104 to 3.307. The overall satisfaction level of respondents is about 3.405. This score is given by respondents by answering the question of evaluating their overall satisfaction toward Vietinbanks card service quality. The frequency of satisfaction level given by 121 customers can be illustrated in the next figure. Figure 3.13- Histogram diagram of satisfaction level

15

80 70 60
frequency

50 40 30 20 10 0 Very Dissa sfied dissa sfied Neutral Sa sfied Very Sa sfied choice

Source: Survey result The figure shows that the evaluation of Vietinbanks card service quality is located around 3.4, accounting for about 90%. This means service quality level is normal distributed.

3.3.Comparison of Vietinbanks and other banks card service quality

As mentioned above, among 121 respondents, 32 also use other banks card service. Figure 3.12 presents customer perception of Vietinbank and other banks card service. According to the data, the service quality level of Vietinbank and that of other banks seem to be equal.

16

ac ce pt an ce pa ym en tf or va rio
0.000 0.500 1.000 1.500 2.000 2.500 3.000 3.500 4.000

4.500

5.000

us we b si te s gn de si bi ll rit y es n of

ni ce ca rd ni ce pa ym en tf or va rio us se rv ic st em AT se to ha ith ve w dr aw in st ni ce ca sh w ith ru c de de ep lim ita tio n sig dr aw ac n on of rv i ea sy ce un de kn tio n AT M fe e s rs t ow le pe M AT M lim ita cu si sh te l le r ra te m pl e or tp s ha ro c ve tio n an dg sy on tio n io n ns ac ct sa se cu tra tra n ac t io n w ac cu ra te in st ru c tio n in fo rm at io n le r id e ns tra de sig

te l ca sh

Figure 3.12- Comparison of Vietinbank and other banks card service

Customer evaluation on Vietinbank card service

17
Customer evaluation of other banks' card service

d e rt im e sc sc pe tra n sa pr oc es go sin od re e n re en rd ct ay io n ed ur g e tim e at tit ud

Card type Debit card

Table 3.2- Customer perception of Vietinbanks card service Advantage Disadvantage

Vietinbank

has

provided

many Vietinbank supplies many debit

services for customers through ATM card level. However, all product network such as foreign currency levels have different transaction receiving, payment services, and limitation from each other only. fixed deposit at ATM. Besides, So market segmentation of

Vietinbank has also provided for Vietinbank customers some mobile and internet meaningless,

becomes products for

banking services. Although mobile segments are quite similar. banking and internet banking services Vietinbank has not provided of Vietinbank are still limited, they international debit card are very convenient for customer to meanwhile Vietnamese use and customers tend to prefer debit internet. Customers can transfer by card rather than credit card. mobile, top up for mobile phone Nowadays, some banks have account by SMS or shopping online issued international debit card with internet payment. leading increasing total number VietinBank has many promotion of card holders. campaigns to encourage customer in Vietinbank has wide ATM and using card services, Vietinbank has POS network. However, ATM loyalty policies accumulating points screen systems are not attractive for customers whenever they make especially in comparison with card payment. Basing on the bonus ATM screen of other banks for points, Vietinbank gives customer example Techcombank, HSBC, lucky numbers or gifts or money ANZ depends on each promotion Vietinbank has provided Mobile programs. and internet banking services transaction on mobile

18

Vietinbanks card service fee is low

however these services are poor for example inquiry, transfer and bill payment. These services cannot be replaced for all face to face services because of customers habit and suspicion. So Vietinbanks services do not satisfy customer who has time constrain to make transaction at Vietinbanks office hours. offices during

Credit card

Interest rate of Vietinbank credit card Credit card issuing procedure of is lower than many other banks, Vietinbank is complicated. To Vietinbank credit card interest rate is be granted credit limit,

16% per year whereas HSBC, ANZ, customers have to apply many Techcombank, ACB have interest papers especially for credit limit nearly 20%per year. without mortgage.

Credit card holders can pay for used Vietinbank policies in granting credit in many ways including auto credit limit is strict which payment, transfer or cash deposit at ignores Vietinbank office system. limited and private

companies with charter capital

Vietinbank are supplying for credit under 20 billion VND. Many card holders many added services potential customers work in with charter such as the SMS banking service to organizations alert customers by each transaction capital under 20 billion VND, which help customers manage their they have demand for credit card spending and unused credit. using but they are ignored credit Vietinbank also provides customer limit granted. the installment services Vietinbank has not provided registration card issuing though

19

internet, telephone and SMS. Credit card of Vietinbank are constrain in card types. It does not have customized card for one typical customer meanwhile other banks such as Eximbank or Dong A bank has card for teachers and doctors Source: Data from survey Qualitative data from interviews shows that customers highly evaluated Vietinbanks card service in such aspects as transaction security, wide transaction system, nice design of card and bill, transaction accusation and service fee. These ideas assure the findings above in quantitative data.

20

CHAPTER 4- CONCLUSIONS AND RECOMMENDATIONS 4.1. Conclusions

There are several models to measure service quality of bank card such as P (perception) model and P-E (perception - expectation) model. By using P model, this report shows quite good result of the research. Card service quality of a bank can be measured based on five groups of indicators. They are reliability, assurance, tangibles, empathy and responsiveness. Each group composes of several indicators. As in the case of Vietinbanks card service, the quality level is just acceptable. On average, there are about 41.4% customers satisfied with the service. This number is quite low in comparison with the level of 59% provided in 2011 World Retail Banking Report, which use data in 2010 of bank industry in the world. Majority of customers are satisfied with transaction security and attitude of tellers and dissatisfied with ATM screens design, cash withdraw limitation per time and wide transaction system. Customers evaluation of other banks card service quality seem to be the same as of Vietinbank. The service quality level is acceptable.

4.2. Recommendations Suggestions to improving debit card service quality

Product innovation: Vietinbank should create more value added services for customers. They would make Vietinbank cards differentiate from other banks cards. Otherwise, Vietinbank should differentiate from each product line which exploits the potential demand from customer. Moreover, VietinBank should concentrate on developing many services for card product. It doesnt need to clarify so many products meanwhile their characteristics nearly the same. VietinBank could combine card account and current account which help customers use VietinBanks services easier Moreover, VietinBank has not provided overdraft for domestic debit card. This is one of the most favorite services for card holders. Many organizations denied using payroll services of VietinBank because VietinBank lacks overdraft service. Increasing rate of active card: the number of active cards should be increased to prevent Vietinbank from waste of card issuing costs and to raise revenue due to the increase of customers. VietinBank should focus on potential customers which requires

21

VietinBank staffs evaluate customers demand exactly. Internet and mobile banking service development: these services help VietinBank attract customers who lack time to make direct transaction. Moreover, developing online payment on many websites helps VietinBank to increase revenue from shopping online. For these reasons, Vietinbank should develop international credit card and inter-bank transfers. VietinBank should also concern with distribution card via internet which help customers register to issue card easier. Facility: Vietinbank should concentrate on improving ATM in term of quality and image to attract customers. It should avoid running out of money in ATM. It also checks other facilities, for example, air conditioning and camera in each ATM box which increases customer satisfaction in using card service at ATM. In addition to that, VietinBank should expand transaction network by providing other kinds of machines such as kiosk banking and combine internet services and ATM services. VietinBank should also concentrate on security solution for customer when making transaction at ATM. Loyal Customer program: Vietinbank should take care much for customers who have high transaction frequency and values. This method is very popular for telecoms companies. Vietinbank can base on statistic at the end of fiscal year to gift customers who have great contribution to revenue of Vietinbank which influent on the customer retention rate for Vietinbank. Further more, VietinBank should promote point of sale accepting VietinBank cards. Promotion campaign for point of sales: promotion campaign for point of sales should be conducted. By this way, VietinBank can push merchants accept card payment in enthusiasm. Cashiers can process the transaction smoothly when they use regularly and card holders realize convenience of card payment. VietinBank should takes care of payment equipment for merchants so that they will not face to error transaction.

Suggestions for Vietinbank to improving credit card service quality

Improving card issuing procedure: card issuing procedure should be simplified to make

22

customers more convenient when applying. The issuing procedure is now quite complicated in Vietinbank because of two reasons. Firstly, there are many forms needed to be filled and personal documents, to be submitted. It takes about 5 days for bank to process these documents. It, thus, results in inconvenience for customers. Secondly, requirements for card issuance should be lower to make the service open to more customers. The current issuance policy is opened for state officials and big companies employees. Thus, potential customers such as small enterprises owner and/ or manager who may have high income are ignored. Promotion campaign: VietinBank should take care for both card holders and point of sales. For card holders, they should be given incentives such as bonus point, discount program and VIP reception. VietinBank has deployed many promotion campaigns however low bonus value does not incentive customers to pay by card. In addition to that, they should be given some new value added services such as online payment, search for internet transaction. Platinum card level providing: Platinum card level should be provided to customers with high income. Besides, the way to classify customers should be re-conducted. Encourage card service at branches: card service should be paid more attention in branches. On average, sales from card service currently account for less than 5% of branches revenue. In addition to that, employees, those are in charged of card service at branches, are not specialized not only in card service but also in some others. Since their resource for card service is constraint, the service is not well developed. Besides, VietinBank card center could coordinate better with branches to develop card business activities. Pay attention to improving quality of human resource: Employees should be trained to be better serve customers. There are three characteristics of employees should be improved. They are health, knowledge and skills and mentality. The solution should focus on improve all of them.

23

Suggested action plan for Vietinbank to improve card service quality in the next two years
The result of the survey revealed that in the near future, Vietinbank should implement some actions to immediately improve its card service quality. In table 4.1, suggested action plan for the year 2012 and 2013 is presented to overcome some shortcomings. Table 4.1- Suggested action plan for 2012 and 2013 Timetable for action Goals - Reduce the failure percentage from 33.1% to 20% December 2013 (failure percentage is calculated by the ratio between customers having trouble in transaction and the total customers) - Increase customer satisfaction level from 37% to 60 % Actions - Reduce time to process documents of customer December 2012

- Lower requirements on credit granting for December 2012 customers - Increase cash withdraw limitation per time December 2012

- Redesign of ATM screen to be nicer and easier to December 2012 read - Increase number of points of sale December 2013

- Conduct courses on improving employees December 2013 working capability. - Tellers should be trained on knowledge of service - Customer service employees should be trained on the way to better solve customer complaints.

24