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INTRODUCTION BANKING INDUSTRY

BANK
Finance is the life blood of trade, commerce and industry. Now-a-days, bank money acts as
the backbone of modern business. Development of any country mainly depends upon the
banking system.
The term bank is derived from the French word Banco which means a Bench or Money
exchange table.
A bank is a financial institution which deals with deposits and advances and other related
services. It receives money from those who want to save in the form of deposits and it lends
money to those who need it.
Oxford Dictionary defines a bank as "an establishment for custody of money, which it pays
out on customer's order."

Features of a Bank:

1. Dealing in Money
Bank is a financial institution which deals with other people's money i.e. money given by
depositors.

2. Individual / Firm / Company


A bank may be a person, firm or a company. A banking company means a company which is
in the business of banking.

3. Acceptance of Deposit
A bank accepts money from the people in the form of deposits which are usually repayable
on demand or after the expiry of a fixed period. It gives safety to the deposits of its
customers. It also acts as a custodian of funds of its customers.

4. Giving Advances
A bank lends out money in the form of loans to those who require it for different purposes.
5. Payment and Withdrawal
A bank provides easy payment and withdrawal facility to its customers in the form of
cheques and drafts, It also brings bank money in circulation. This money is in the form of
cheques, drafts, etc.

6. Agency and Utility Services


A bank provides various banking facilities to its customers. They include general utility
services and agency services.

7. Profit and Service Orientation


A bank is a profit seeking institution having service oriented approach.

8. Connecting Link
A bank acts as a connecting link between borrowers and lenders of money. Banks collect
money from those who have surplus money and give the same to those who are in need of
money.

9. Banking Business
A bank's main activity should be to do business of banking which should not be subsidiary to
any other business.

10. Name Identity


A bank should always add the word "bank" to its name to enable people to know that it is a
bank and that it is dealing in money.

HDFC BANK
HDFC Bank Limited is a major Indian financial services company based in India,
incorporated in August 1994, after the Reserve Bank of India allowed establishing private
sector banks. The Bank was promoted by the Housing Development Finance Corporation, a
premier housing finance company (set up in 1977) of India. HDFC Bank has 1,725 branches
and over 5,000 ATMs, in 780 cities in India, and all branches of the bank are linked on an
online real-time basis.
The headquarters of HDFC Bank is in Mumbai, India. And its area served is worldwide.

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Organizational Goals
HDFCs main goals are to:
a) Develop close relationships with individual households
b) Maintain its position as the premier housing finance institution in the country,
c) Transform ideas into viable and creative solutions.
d) Provide consistently high returns to shareholders.
e) To grow through diversification by leveraging off the Existing client

Subsidiaries of HDFC Bank consist of:


1. HDFC Bank
2. HDFC Mutual Fund
3. HDFC Standard Life Insurance Company
4. HDFC Realty
5. HDFC Chubb General Insurance Company Limited.
6. Credit Information Bureau (India) Limited
7. Other Companies Co Promoted by HDFC
a) HDFC Trustee Company Ltd.
b) GRUH Finance Ltd
c) HDFC Developers Ltd.
d) HDFC Venture Capital Ltd.
e) HDFC Securities Ltd
f) HDFC Holding Ltd.
HDFC BANK LIMITED Background of HDFC Bank

BACKGROUND

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The 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, as part of RBI's liberalization of the Indian Banking Industry in 1994. The
bank 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.

PROMOTER

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, strong market reputation, large shareholder base and
unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian
environment.

BUSSINESS FOCUS

HDFC Bank's mission is to be a World Class Indian Bank. The objective is to build sound
customer franchises across distinct businesses so as to be the preferred provider of banking
services for 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. HDFC Bank's business philosophy is based on four core values: Operational
Excellence, Customer Focus, Product Leadership and People.

AMALGAMATION OF TIMES BANK & CENTURION BANK OF


PUNJAB WITH HDFC BANK
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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 will have a strong deposit base of around Rs1, 22,000 crore and net
advances of around Rs89, 000 crore. The balance sheet size of the combined entity would be
over Rs1, 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.

DISTRIBUTION NETWORK

HDFC Bank is headquartered in Mumbai. As on December 31, 2009, the Bank has a network
of 1725 branches in 771 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 centres, 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 /

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settlement bank to various leading stock exchanges, the Bank has branches in centres where
the NSE / BSE have a strong and active member base.

The Bank also has a network of 3898 ATMs across India. 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.

MANAGEMENT structure of HDFC Bank

Name Designation
C M Vasudev Chairman / Chair Person
Harish Engineer Executive Director
Renu Karnad Director
Pandit Palande Director
Bobby Parikh Director
Aditya Puri Managing Director
Paresh Sukthankar Executive Director
Ashim Samanta Director (up to 18.11.2012)
Partho Datta Director
Anami N Roy Director
Mr. Keki Mistry Director
Vijay Merchant Director (appointed on 14.03.2013)

TECHNOLOGY

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).

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The Bank has made substantial efforts and investments in acquiring the best technology
available internationally, to build the infrastructure for a world class bank. In terms of core
banking software, the Corporate Banking business is supported by Flexcube, while the Retail
Banking business by Finware, both from i-flex Solutions Ltd. The systems are open,
scaleable &web-enabled.

The Bank has prioritised 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.

BUSINESS PROFILE

HDFC Bank caters to a wide range of banking services covering commercial and investment
banking on the wholesale side and transactional / branch banking on the retail side. The bank
has three key business segments:

(a)Wholesale banking

The Bank's target market is primarily large, blue chip manufacturing companies in the Indian
corporate sector and to a lesser extent, small & mid-sized corporates 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 corporates
including multinationals, companies from the domestic business houses and prime public
sector companies. It is recognized as a leading provider of cash management and
transactional banking solutions to corporate customers, mutual funds, stock exchange
members and banks.

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a) 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, corporates 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.

b) Retail Banking
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, NetBanking and Mobile Banking.

Mission and Business Strategy

Our mission is to be "a World Class Indian Bank", benchmarking ourselves against
international standards and best practices in terms of product offerings, technology, service
levels, risk management and audit & compliance. The objective is to build sound customer
franchises across distinct businesses. Our business strategy emphasizes the following:

Increase our market share in Indias expanding banking and financial services industry by
following a disciplined growth strategy focusing on quality and not on quantity and
delivering high quality customer service.
Leverage our technology platform and open scale able systems to deliver more products to
more customers and to control operating costs.
Maintain our current high standards for asset quality through disciplined credit risk
management.
Develop innovative products and services that attract our targeted customers and address
inefficiencies in the Indian financial sector.
Continue to develop products and services that reduce our cost of funds.

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Focus on high earnings growth with low volatility.

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PRODUCTS AND SERVICES

1 ) P E R S O N A L B A N K I N G S E R VI C E S

A ) Ac c o u n t s & D e p o s i t s Loan against Property


Savings Account Commercial Vehicle Finance
Regular Savings Account Working Capital Finance
Savings plus Account Construction Equipment Finance
Savings Max Account
Senior Citizens Account C) Investments & Insurance
Payroll Salary Account Mutual Funds
Regular Salary Account Insurance
Kid's Advantage Account Bonds
Pension Saving Bank Account Financial Planning
Family Savings Account Knowledge Centre
Equities & Derivatives
Current Account
Plus Current Account
Trade Current Account D) Payment Services
Premium Current Account Net Safe
Regular Current Account Prepaid Refill
Apex Current Account Bill Pay
Max Current Account Direct Pay
Visa Money Transfer
B) Loans E-Monies Electronic Funds Transfer
Personal Loans Excise & Service Tax Payment
Home Loans
Two Wheeler Loans
New Car Loans
Overdraft against C
E) Access Your Bank - One View
Loan against Securities Instar Alerts

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Mobile Banking ATM
PhoneBanking

2) WHOLESALE BANKING SERVICES


Funded Services Corporate Salary a/c
Non Funded Services Tax Collection
Value Added Services Financial Institutions
Internet Banking Mutual Funds
Clearing Sub-Membership Stock Brokers
RTGS sub membership Insurance Companies
Fund Transfer Commodities Business
ATM Tie-ups Trusts

3) NRI BANKING SERVICES


Rupee Saving a/c Rupee Current a/c
Rupee Fixed Deposits Foreign Currency Deposits
Accounts for Returning Indians

4) PAYMENT SERVICES
Net Safe Bill Pay
Insta Pay Direct Pay
Visa Money Online Donation

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SWOT ANALYSIS

STRENGTH:

1) Right strategy for the right products.

2) Superior customer service vs. competitors.

3) Great brand image.

4) High degree of customer satisfaction.

WEAKNESSES:

1) Some gaps in range for certain sectors.

2) Customer service staff needs training.

3) Sectorial growth is constrained by low unemployment levels and competition for staff.

OPPORTUNITIES:

1) Profit margins will be good.

2) Could extend to overseas broadly.

3) Could seek better customer deal.

4) An applied research center to create opportunities for developing techniques to provide


value- added services.

THREATS:

1) Legislation could impact.

2) Great risk involved.

3) Very high competition prevailing in the market.


COMPETITION INFORMATION

HDFC Banks main competitors are as follows:-

1) Axis Bank Ltd.

Axis Bank Limited, formerly UTI Bank, is a financial services firm that had begun operations
in 1994, after the Government of India allowed new private banks to be established. The
Bank's Registered Office is at Ahmadabad and its Central Office is located at Mumbai. Axis
Bank one of the largest private sector financer in India for Agriculture loans.

2) ICICI Bank Ltd.

ICICI Bank Limited also known as Industrial Credit and Investment Corporation of India
Bank is the second largest financial service company headquartered at Mumbai, India. The
Bank has a network of 2,533 branches and 6,601 ATMs in India, and has a presence in 19
countries, including India. ICICI Bank was established in 1994 by ICICI Limited, an Indian
financial institution, as a wholly owned subsidiary.

3) Kotak Mahindra.

The Kotak Mahindra group is a financial organization established in 1985 in India. It was
previously known as the Kotak Mahindra Finance Limited, a non-banking financial company.
In February 2003, Kotak Mahindra Finance Ltd was given the license to carry on banking
business by the Reserve Bank of India (RBI). Kotak Mahindra Finance Ltd. is the first
company in the Indian banking history to convert to a bank. Today it has more than 20,000
employees and Rs. 10,000 crore in revenue.

4) State Bank of India

State Bank of India (SBI) (is the largest Indian banking and financial services company (by
turnover and total assets) with its headquarters in Mumbai, India. It is state-owned. SBI
provides a range of banking products through its vast network of branches in India and
overseas, including products aimed at non-resident Indians (NRIs). The State Bank Group,
with over 16,000 branches, has the largest banking branch network in India. SBI has 14 Local
Head Offices and 57 Zonal Offices that are located at important cities throughout the country.
It also has around 130 branches overseas.

5) Yes Bank Ltd.

YES Bank Limited is an Indian Bank, engaged in providing a range of banking and financial
services. The Banks business segments include Treasury, Corporate/Wholesale Banking,
and Retail Banking, Corporate Finance, Transaction Banking and a host of other Banking
services. It was founded by Rana Kapoor and his partner (Late) Ashok Kapur, with the duo
holding a collective financial stake of 27.16%.

6) IndusInd Bank

IndusInd Bank, which commenced operations in 1994, caters to the needs of both consumer
and corporate customers. Its technology platform supports multi-channel delivery
capabilities. As on June 30, 2013, IndusInd Bank had 530 branches, and 1003 ATMs spread
across 380 geographical locations of the country. The Bank also has representative offices in
London and Dubai. The Bank believes in driving its business through technology. It enjoys
clearing bank status for both major stock exchanges - BSE and NSE - and major commodity
exchanges in the country, including MCX, NCDEX, and NMCE. IndusInd Bank on April 1,
2013 was included in the NIFTY 50 benchmark index. IndusInd Bank also offers DP facilities
for stock and commodity segments.

7) ING Vysya

ING Vysya Bank Ltd is a global financial institution of Dutch origin offering banking,
investments, life insurance and retirement services. More than 84,000 ING employees server
over 61 million private, corporate and institutional customers in over 40 countries in Europe,
North America, Latin America, Asia and Australia. We draw on our experience and expertise,
our commitment to excellent service and our global scale to meet the needs of a broad
customer base, comprising individuals, families, small, businesses, large corporations,
institutions and governments.

8) J&K

J&K Bank functions as a universal bank in Jammu & Kashmir and as a specialised bank in
the rest of the country. It is also the only private sector bank designated as RBIs agent for
banking business, and carries out the banking business of the Central Government, besides
collecting central taxes for CBDT. The J&K Bank is rated P1, indicating the highest degree of
safety by Standard & Poor and CRISIL. J&K Bank operates on the principle of 'socially
empowering banking' and seeks to deliver innovative financial solutions for household, small
and medium enterprises.

Theoritical aspect
Current Account :Businessmen who have a high number of regular transactions with the
bank open current bank account. It also includes deposits, withdrawals & contra transactions.
It is also known as demand deposit account.

Type of Current Account of HDFC Bank

There are many types of current account of HDFC Bank, namely Regular Current Account,
Premium Current Account, Trade Current Account, Plus Current Account, Max Current
Account, Ultimo Current Account, Supreme Current Account, Apex Current account, Ezee
Current Account, Agri Current Account, Current Account for Hospitals and Nursing Homes,
Current Account for Professionals, Merchant Advantage Plus Current account, Merchant
Advantage Current account, Flexi Current Account, Institutional Current Account and HDFC
Bank of Panipat is offering most of them.

Regular Current Account

A Current account is ideal for carrying out day-to-day business transactions. With the
HDFC Bank Regular Current Account, you can access your 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
your account. Regular Current Account requires you to maintain an average quarterly
balance of only Rs. 10,000.

Features and Benefits :

1) Convenient inter-city banking :


Free anywhere cheque payment
2) Free payments and collections through NEFT
3) Free RTGS collection. RTGS payment @ Rs.25/- per transaction
4) Inter-city Account to accounts funds transfer between HDFC Bank accounts at a nominal
charge of Rs.15/- per transactions
5) Free Demand Drafts (DD) above Rs.100,000/-. Demand drafts up to Rs.50,000/- at flat
cost of Rs.40/-. DDs above Rs.50,000/- & up to Rs.100,000/- at nominal cost of Rs.25/-

Premium Current Account

You can avail benefits of inter-city banking account with Premium Current 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.15 Lacks per
month. A Current Account with the benefits of accessing your account from a large network
of branches, and through direct access channels - the phone, mobile, Internet and through the
ATM.

Features and Benefits:

1) Free anywhere collection & payment within HDFC Bank branch network (except Dahej), up
to Rs.15 lacs per month, incremental amount to be charged @ Rs.1.50 per Rs.1, 000/-, min
Rs.25/-
2) Free RTGS collection. RTGS payment @ Rs.25/- per transaction.
3) Free Inter-city Account to accounts funds transfer between HDFC Bank accounts.

Trade Current Account

HDFC Bank Trade Current Account gives you the power of inter-city banking with a single
account. From special cheques that get treated at par with local ones in any city where we
have a branch, to free account to account funds transfer between HDFC Bank accounts, to
free inter-city cheque collection (through clearing) of up to Rs. 35 lakhs per month, our
priority services have become the benchmark for banking efficiency. Trade Current Account
requires you to maintain an average quarterly balance of Rs. 40,000.

Features and Benefits:

1) Free Account to account funds transfer between HDFC Bank accounts.


2) Free RTGS/NEFT Transactions.
3) Free up to 30 Demand Drafts (DD) per month and can be issued from any HDFC Bank
Branch.
4) Free up to 30 Pay Orders (PO) per month and can be issued from any HDFC Bank Branch.
5) Free anywhere cheque collection within HDFC Bank branch network (except Dahej), up to
Rs.35 lacs per month.

Plus Current Account

In today's fast-paced world, your business regularly requires you to receive and send funds to
various cities in the country. From special cheques that get treated at par with local ones in
any city where we have a branch, faster collection of outstation cheques (payable at branch
locations), free account to account funds transfer between HDFC Bank accounts to Free inter-
city cheque collection (clearing) of up to 75 lakhs per month. Plus Current Account requires
you to maintain an average quarterly balance of Rs. 100,000.

Apex Current account


A high end current account that caters to fast growing, large businesses who can derive
maximum advantage from the host of benefits offered.

Features and Benefits:

1) Maximum transactional benefits with faster mobilization of funds


2) Maintain an Average Quarterly Balance of Rs. 10, 00,000.
3) Access to more than 3000 branches.
4) Faster collection of outstation cheques through Speed Clearing. Speed clearing is
absolutely free with your Apex Current Account.
5) Free Inter-city cheque collections and payments within HDFC Bank Network for
unlimited value (excluding Dame).
6) Free account to account funds transfers between HDFC Bank accounts.

Agri Current Account :A current account ideally suited for those in Agriculture related
industries where the nature of business is seasonal.

Features and Benefits:

1) Agri Current Account offers those involved in Trading of agricultural commodities,


the benefit of Half Yearly Average Balance Requirement of Rs. 10000/-. As such, you
need not bother about AQB charges in non-business months.
2) Free unlimited cash withdrawals from Home Branch.
3) 50 free Payableatpar cheque leaves per month.
4) Free Cash Deposits up to Rs.10 lacs per month across all branches in your home
city*.
5) Current Account for Hospitals and Nursing Homes

Best suited for Hospitals and Nursing Homes, this current account comes with higher cash
deposit limits.

Features and Benefits:

1) Free Cash Deposit up to Rs. 10 lakhs per month at Home Location.


2) Free account to account funds transfers (local and anywhere) within HDFC bank.
3) Free Local cheque collections and payments.
4) Free payments and collections through NEFT.
5) Free payments and collections through RTGS.

Current Account for Professionals

Doctors, Architects, Chartered Accountants and other professionals can derive maximum
value from this current account.
Features and Benefits:

1) Average Quarterly Balance (AQB) requirement of Rs. 10,000.


2) Free Cash Deposits up to Rs.10 lacs per month across all branches in your home city*
3) Free account to account funds transfers (local and anywhere) within HDFC bank..

Institutional Current Account : is a specially designed current account product for


Trusts, Associations, Societies, Clubs, Non-Profit Organizations and Government Department
Municipal Bodies. It has features which are specially designed keeping in mind the
requirement of the Institutional segment.

Features and Benefits:

1) Free local and anywhere fund transfer facility within HDFC Bank.
2) Free local and anywhere cheque payment facility.
3) Free anywhere cheque collection of Rs. 350 lac per month, above which charges at
Rs. 1.50/1000 subject to minimum of Rs. 50 per transaction.
4) Free bulk transaction of 300 transactions per month, beyond which Rs. 10 per
transaction.
5) Free Outstation cheque collection at Bank location.

Practical aspect

CURRENT ACCOUNT

It is running and account which may be operated upon any number of

times during a working day. There is no restriction on the number and the

amount of the withdrawals from a current account. As the banker is under an

obligation to reply these deposit on demand, they are called demand liability of

a banker.

A minimum average quarterly balance is Rs.10,000/-.

First Cheque book is free

Free ATM card, phone banking, net banking and mobile banking

Any body can open this account except minor


30 transaction through ATM per month are free

The charges for non-maintains of AQB are Rs. 750 per quarter.

The charges for issuing the new Cheque book is Rs.2/- per leaf.

Monthly statements are send free to customers.

LITERATURE REVIEW

Both the technical and the functional dimensions of service management were shown
to correlate with customer satisfaction. Thus, SMEs seem to evaluate their banking
relationship not only on the basis of the effectiveness and quality of banks' service
outcomes but also on the care and manner in which the bankers deliver services.
(Nicolas Lundahl, Fatima Vegholm, Lars Silver, Managing Service
Quality Volume: 19 Issue: 5 2009)

The purpose of this paper is to explore the relationship between corporate social
responsibility (CSR) and customer outcomes. This paper reviews the literature on
CSR effects and satisfaction, noting gaps in the literature. A series of propositions is
put forward to guide future research endeavors. By understanding the likely impact on
customer satisfaction of CSR initiatives vis--vis customer-centric initiatives, the
academic research community can assist managers to understand how to best allocate
company resources in situations of low customer satisfaction. Such endeavors are
managerially relevant and topical. Researchers seeking to test the propositions put
forward in this paper would be able to gain links with, and possibly attract funding
from, banks to conduct their research. Such endeavors may assist researchers to
redefine the stakeholder view by placing customers at the center of a network of
stakeholders. An understanding of how to best allocate company resources to increase
the proportion of satisfied customers will allow bank marketers to reduce customer
churn and hence increase market share and profits. (Lynette M. McDonald, Sharyn
Rundle-Thiele, International Journal of Bank Marketing Volume: 26 Issue:
3 2008)
Ethics have always played a crucial role in the realm of business and commerce. This paper
aims to extract the principle factors of ethical practices to develop a model for competitive
advantage in banking and to show the relation between ethical practice and customer
satisfaction and the linked reason for satisfaction as a tool for competitive advantage. Based
on the literature review, ethical issues in banking have been identified as a foundation work.
Then an empirical study using survey research has been completed. The survey questionnaire
has been designed using the literature and pilot survey input. Factor analysis has been
conducted to derive ethical factors for competitive advantage from the survey data, which
included 186 responses. ?2 tests were also carried out to show the linked .From the analysis;
two principle factors have been extracted: the cost leveraging factor; and the value leveraging
factor which lead to competitive advantage. Moreover, it also revealed that high ethical
practice results in high customer satisfaction and performance. ( Goitom Tesfom, Nancy J.
Birch Journal of Services Marketing Volume: 25 Issue: 5 2011)
This research investigated the relationship between three elements core service
quality, relational service quality- and perceived value and customer satisfaction and
future intentions across four services. The results revealed that core service quality
(the promise) and perceived value were the most important drivers of customer
satisfaction with relational service quality (the delivery) a significant but less
important driver. A direct link between customer satisfaction and future intentions was
established. The relative importance of the three drivers of satisfaction varied among
services. Specifically, the importance of core service quality and perceived value was
reversed depending on the service. A major conclusion was that both perceived value
and service quality dimensions should be incorporated into customer satisfaction
models to provide a more complete picture of the drivers of satisfaction.. (Gordon
H.G. McDougall,Birch Journal of Services Marketing Volume: 25 Issue: 5 2011)
Results from independent two-sample t-tests and logistic regression support all five
hypotheses, confirming that young and older bank customers differ significantly in their
perception of switching barriers: relational benefits, switching costs, availability and
attractiveness of alternatives, service recovery and the duration of time they intend to end
their relationship with their banks. This study was conducted among employees of two higher
education institutions. Thus, further research needs to test the research results in a diverse
population. Since younger customers are more likely to change their banks easily, if retail
banks want to retain younger customers they need to offer more meaningful incentives to
younger customers than they offer to older customers. In terms of practice the findings in this
research highlight the need for managers to design different switching barrier packages for
each customer age group. ( Goitom Tesfom, Nancy J. Birch Journal of Services
Marketing Volume: 25 Issue: 5 2011)

This research investigated the relationship between three elements core service
quality, relational service quality- and perceived value and customer satisfaction and
future intentions across four services. The results revealed that core service quality
(the promise) and perceived value were the most important drivers of customer
satisfaction with relational service quality (the delivery) a significant but less
important driver. A direct link between customer satisfaction and future intentions was
established. The relative importance of the three drivers of satisfaction varied among
services. Specifically, the importance of core service quality and perceived value was
reversed depending on the service. A major conclusion was that both perceived value
and service quality dimensions should be incorporated into customer satisfaction
models to provide a more complete picture of the drivers of satisfaction. (Gordon
H.G. McDougall, (Professor of Marketing, School of Business and Economics,
Wilfred Laurier University, Waterloo, Ontario, Canada), Terrence Levesque,
(Professor of Economics, School of Business and Economics, Wilfrid Laurier
University, Waterloo, Ontario, Canada

RESEARCH METHODOLOGY

OBJECTIVES OF THE STUDY


Main objective:
To know the customers satisfaction level and their perception towards of HDFC
Bank services.

Sub objectives:
To know that whether the customer is getting prompt services from the bank or not.
To know the level of interest of customer towards differentproducts of current
account.
To know the reasons that attracts the customers to be a part of the bank.
To know the customer awareness regarding the Banks extra services.

RESEARCH METHODOLOGY

This topic describes the methods of the study of the project. Research is a careful
investigation or inquiry especially through search for new facts in branch of
knowledge: market research specifies the information.Research problem is the one which
requires a researcher to find out the best solution for the g i v e n p r o b l e m t h a t i s t o f i n d
o u t t h e c o u r s e o f a c t i o n , t h e a c t i o n t h e o b j e c t i v e s c a n b e obtained optimally
in the context of a given environment.
RESEARCH DESIGN
A framework or blueprint for conducting the research project. It specifies the details of the
procedures necessary for obtaining the information needed to structure and/or solve research
problems.
Define the information needed.
Design the research.
Specify the measurement and scaling procedures.
Construct and present a questionnaire or an appropriate form for data collection.
Specify the sampling process and sampling size.
Develop a plan of data analysis.
Data Collection: -
The data are collected by the primary and secondary sources both to know the customers
satisfaction level towards Current Account of HDFC Bank.
a) Primary sources:-

The primary sources are those through which data can be collected by first hand. The data
has been collected directly from respondents with the help of questionnaires and analysis was
done on the basis of response received from the customers.The questionnaire has been
designed in such a manner that the consumers satisfaction level can be measured
easily.

SECONDARY DATA:-

Secondary data means data that are already available i.e. they refer the data which have
already been collected and analyzed by someone else. When the researcher utilizes secondary
data, than he has to look into various sources from where he can obtain them, in this case he
is certainly not confronted with the problems that are usually associated with the collection of
original data. Secondary data may either be published data or unpublished data. Usually
published data are available in:

The main source of information for the project was

Weekly magazine;
Internet
Newspapers
RESEARCH PERIOD
Research work is done in 6 weeks from 08 June to 08 July 2013.

AREA OF STUDY

The area of survey is Panipat City.

SAMPLE SIZE

The sample of 100 persons was taken on the basis of convenience.

Tools for analysis

Graphical tools:

Graphical tools used are

Pie chart

Bar diagram

1) SAMPLE SIZE:-

The size of samples greatly affects the survey results, but the size may not be substantial, may
be too short for the conduct of survey in market.

2) TIME:-

Time constraints were a great barrier as the work was to be completed in a given time
period.

3) INFORMATION MAY BE BIASED:-

Respondents answer may be biased; it may be influenced by other factors such as


advertisements, brand ambassador, family members, relatives etc.

4) LIMITED AREA OF STUDY:-

The area of study is also greatly affecting the study done;this study is done in limited area
only in Panipat city.
Data Analysis

Q. 1 CUSTOMER PROFILE OF SURVEYED RESPONDENTS

Table 1. Customer Profiles of Surveyed Respondents.

Feedback No. of Respondents Percentage of


Respondents(N=100)

Business 92 92%

Profession 8 8%

Services 0 0%

Total 100 100%

Source: questionnaire survey

Percentage of Respondents
92%
100%
80%
Percentage of
60%
Respondents
40%
20% 8%
0% 0%
Business
Profession
Service
Figure 1.OCCUPATIONS OF THE RESPONDENTS

INTERPRETATION:

According to the above analysis it is concluded that out of sample of 100 people, 92%
respondents were businessman, 8% respondents were having profession and 0% respondents
were serviceman.

Q. 2 HOW LONG YOU ARE A PART OF HDFC BANK?

Table 2

Feedback No. of Respondents Percentage of


Respondents (N=100)
Less Than 6 Months 20 20%

Less Than 1 Year 37 37%

Less Than 2 Years 14 14%

More Than 2 Years 29 29%

Total 100 100%

Percentage of respondents
Less Than 6 Months
29% 20%
Less Than 1 year
Less Than 2 Years
14% 37% More Than 2 Years

Figure 2 Time period of stay in HDFC Bank

INTERPRETATION:
The above diagram shows that 20% respondents were a part of bank for less than 6 months,
37% respondents were a part of bank for less than 1 year, 14% respondents were a part of
bank for less than 2 years and 29% respondents were a part of bank for more than 2 years.

Q. 3. WHAT ARE THE REASONS THAT ATTRACT YOU TO BE A CUSTOMER OF


THE BANK?

Table 3

Feedback No. of Respondents Percentage of


Respondents (N=100)
Its Image 40 40%

Its Services 30 30%

Its Product 20 20%

All Above 10 10%

Total 100 100%

Percentage of respondents
50%
40%
30%
20%
10%
0%
0.5 1 1.5 2 2.5 3 3.5 4 4.5

Figure 3Major attraction of the bank

INTERPRETATION:
The above diagram shows that 40% respondents were attracted to the bank because of its
image, 30% were attracted because of its services, 20% were attracted because of its
products, and 10% were attracted because of all three reasons.

Q.4. ARE YOU SATISFIED WITH THE FEATURES AND BENEFITS OF THE
PRODUCTS OF CURRENT ACCOUNT?

Table 4

Feedback No. of Respondents Percentage of Respondents


(N=100)

Strongly Agree 22 22%

Agree 47 47%

Neutral 29 29%

Disagree 2 2%

Strongly Disagree 0 0%

Total 100 100%

Source: questionnaire survey

Percentage of respondents
60% 47%
40% 22% 29% Percentage Of
20% 2% Respondents
0%
0%

Figure 4 HDFC Bank is providing satisfaction to customers.

INTERPRETATION:

From the above analysis it is concluded that 22% respondents were strongly agree with the
statement , 47% respondents only agree with the statement, 29% respondents were neutral,
2% respondents were disagree but no respondent was strongly disagree with the above
statement.
Q 5. Which product of current account you prefer?

Table 5

Feedback No. of Respondents Percentage of


Respondents(N=100)

Regular Current Account 25 25%

Premium Current Account 46 46%

Trade Current Account 15 15%

Plus Current Account 14 14%

Total 100 100%

Source: questionnaire survey

Percentage of Respondents
50%
40%
30%
20% 46%
10% 25% Percentage Of
15% 14%
0% Respondents

Figure 5 Product of current account you prefer the most.

INTERPRETATION:

From the above analysis it is concluded that most of the respondents preferred Premium
Current Account, 25% respondents preferred Regular Current Account, 15% respondents
preferred Trade Current Account and 14% respondents preferred Plus Current Account.
Q 6. Would you recommend current account of HDFC Bank to others?

Table 6

Feedback No. of Respondents Percentage of


Respondents(N=100)
Definitely 48 48%

Probably 22 22%

Might or might not 27 27%

Probably Not 3 3%

Definitely Not 0 0%

Total 100 100%

Percentage of Respondents
48%
50%
40% 22% 27%
30% 3% 0%
20%
10% Percentage Of
0%
Respondents

Figure 6 current account recommendation of HDFC Bank to others

INTERPRETATION:

From the above analysis of given sample of 100 respondents, 48% respondents will
definitely recommend product to others, 22% respondents will probably recommend product
to others, 27% respondents will might or might not recommend, 3% respondents will
probably not recommend, but no respondent will definitely not recommend product to others

Ques 7. Do you know about extra services being provided by the bank?

Table7
Feedback No. of Respondents Percentage of
Respondents(N=100)
Yes 100 100%

No 0 0%

Total 100 100%

Source: questionnaire survey

Percentage of Respondents

Yes
No

Figure 7 Knowledge about extra services being provided by the bank.

INTERPRETATION:

From the above analysis it is concluded that all respondents know about extra services being
provided by the bank.

Q 8. Which of the following extra services of the bank would you like to go
in for?

Table 8

Feedback No. of Respondents Percentage of


Respondents(N=100)
Phone Banking 5 5%

ATM 40 40%

Net Banking 5 5%

Bill Payment 10 10%

All Above 40 40%

Total 100 100%

Source: questionnaire survey

Percentage of Respondents
40% 40%
40%
30% 5% 5% 10%
20% Percentage Of
10%
0% Respondents

Figure 8 Extra benefits asked by respondents from bank.

INTERPRETATION:

From the above analysis of given sample of 100 respondents , 40% respondents know about
ATM services , 5% respondents know about Phone banking , 5% respondents know about Net
Banking, 10% respondents know about Bill Payment and 40% respondents know about all
services.

Ques 9. Do you always get prompt services whenever you visit the branch?

Table 9

Feedback No. of Respondents Percentage of


Respondents(N=100)

Always 30 30%

Often 34 34%
Sometimes 27 27%

Rarely 7 7%

Never 2 2%

Total 100 100%

Percentage of Respondents
Always
34%
40% 30% Often
27%
Sometimes
30%
Rarely
20% 7% Never
2%
10%
0%
No. Of Respondents

Figure 9

INTERPRETATION:

From the above analysis it is concluded that 30% respondents always get prompt services
whenever they visit the branch, 34% respondents often get prompt services and 27%
respondents get sometimes prompt services and 7% get rarely prompt services whenever they
visit the branch and 2% respondents never get prompt services whenever they visit the
branch.

Ques10. If another bank provides you same facilities, would you like to
switch to other bank?

Table 10

Feedback No. of Respondents Percentage of


Respondents(N=100)
No, Not At All 48 48%

I May Consider 22 22%

Yes, Surely 2 2%
Cant Say 28 28%

Total 100 100%

ANALYSIS 10: Preference of other bank over HDFC Bank.

Percentage of Respondents
48%
50%
40% 28%
22%
30% Percentage Of
20% 2% Respondents
10%
0%

Figure 10

INTERPRETATION:

According to the above analysis, it is concluded that most of the respondents would not like
to switch to other bank and 2% respondents would surely switch to other bank and 28%
respondents cant say anything but 22% respondents may consider other bank.

Q. 11. What is your overall satisfaction rating with HDFC Bank ?

Table 4.11

Feedback No. of Respondents Percentage of


Respondents(N=100)
Very Dissatisfied 0 0%

Somewhat Dissatisfied 2 2%

Neutral 29 29%

Somewhat Satisfied 47 47%


Very Satisfied 22 22%

Total 100 100%

ANALYSIS11: Overall satisfaction rating with HDFC Bankcurrent account.

Percentage of Respondents
47%
50%
40%
30% 22%
20% Percentage Of
10% 2%
0% Respondents
0% 29%

Figure 11

INTERPRETATION:

The above diagram shows that no respondent is very dissatisfied with HDFC Bank, only 2%
respondent is somewhat dissatisfied with the bank, 29% respondents were neutral and 47%
respondents were somewhat satisfied and 22% respondents were very satisfied with the
HDFC Bank.

FINDING & LEARNING

1) It is concluded that out of sample of 100 people, 92% respondents were businessman, 8%
respondents were having profession and 0% respondents were serviceman.

2) It is concluded that 20% respondents were a part of bank for less than 6 months, 37%
respondents were a part of bank for less than 1 year, 14% respondents were a part of bank for
less than 2 years and 29% respondents were a part of bank for more than 2 years.

3) It is concluded that 40% respondents were attracted to the bank because of its image, 30%
were attracted because of its services, 20% were attracted because of its products, and 10%
were attracted because of all three reasons.
4) It is concluded that 84% respondents were satisfied with benefits and features of current
account and 16% respondents was not satisfied with benefits and features of current account
of the HDFC Bank.

5) It is concluded that most of the respondents preferred Premium Current Account, 25%
respondents preferred Regular Current Account, 15% respondents preferred Trade Current
Account and 14% respondents preferred Plus Current Account.

6) It is concluded out of given sample of 100 respondents, 48% respondents will definitely
recommend product to others, 22% respondents will probably recommend product to others,
27% respondents will might or might not recommend, 3% respondents will probably not
recommend, but no respondent will definitely not recommend product to others.

7) It is concluded that all respondents know about extra services being provided by the bank.

8) It is concluded that out of given sample of 100 respondents , 40% respondents use ATM
services , 5% respondents use Phone banking , 5% respondents use Net Banking, 10%
respondents use Bill Payment and 40% respondents use all services.

9) It is concluded that 30% respondents always get prompt services whenever they visit the
branch, 34% respondents often get prompt services and 27% respondents get sometimes
prompt services and 7% get rarely prompt services whenever they visit the branch and 2%
respondents never get prompt services whenever they visit the branch.

10) It is concluded that most of the respondents (48%) would not like to switch to other bank
and 2% respondents would surely switch to other bank and 28% respondents cant say
anything but 22% respondents may consider other bank.

11) It is concluded that no respondent is very dissatisfied with HDFC Bank, only 2%
respondent is somewhat dissatisfied with the bank, 29% respondents were neutral and 47%
respondents were somewhat satisfied and 22% respondents were very satisfied with the
HDFC Bank.

OTHER FINDINGS:

1) Out of 100 respondents, most of the respondents were a part of the bank for less than 1 year.
2) Most of the respondents were attracted to the bank because of its image.
3) Most of the respondents were agree that HDFC Bank is providing 100% satisfaction.
4) Only 84% respondents were satisfied with benefits and features of current account of the
HDFC Bank.
5) Most of the respondents preferred Premium Current Account.
6) 56 respondents were using other bank account than HDFC Bank and 44 respondents were not
using other bank account than HDFC Bank.
7) All customers are aware of extra services offered by HDFC Bank.
8) Most of the respondents are go in for ATM services
9) It is concluded that most of the respondents would not like to switch to other bank.
10) Most of the respondents will definitely recommend product to others.

SUGGESTIONS
1. Bank should try to retain the loyal customers.
2. Bank should try to attract customers by its services and products
3. Bank should try to change the perception of the customers in a positive way that it provides
100% satisfaction to its customers.
4. The bank should enhance their services according to the needs of the customer so that they
can be satisfied with benefits and features of the current account.
5. Bank should satisfy the customer in such a way that they could not switch to other bank.
6. Bank should focus on net banking and phone banking.
7. The bank should make its procedures less time consuming.
8. Bank should try to satisfy its customers in overall performance.
CONCLUSION

CONSUMER RESEARCH:

Consumer research deals with consumer and their problem and solution to the problem. This
study helps to know about the consumers need and expectation levels regarding products and
ascertainable levels of consumer satisfaction.

PRODUCT RESEARCH:

Under product research I came to know about the modification which consumers want so the
features and benefits of the product of the current account.