Professional Documents
Culture Documents
INTRODUCTION
1.1 Introduction
The business of banking is as old as the civilization itself. The mere fact that the Babylonians,
in 200 BC, lent money at higher rates of interest against gold and silver under the temple’s
safe custody stands proof for banking history. In ancient days, the main function of banks was
granting loans to individuals or the state in times of crisis.
The Financial Services is the backbone of service sector. This is Important not only for the
banking sector but for the Indian economy as a whole. This is so because banking is a catalyst
and life of modern trade and commerce. Banking being a service business, the best strategy
can only be to identify with the customer and offer them what they actually need. This
objective can only be achieved through best customer service. It is an integral part of all the
businesses and social activities. This rapid transformation of services in the banking system
has led to the evolution of a highly competitive and complex market where there is a
continuous refinement of services. These changes are compelling the banks to reorganize
themselves in order to cope with the present conditions.
With the current change in the functional orientation of banks, the purpose of banking is
re-defined. Now, the Financial Institutions are trying to provide all the services at the
customer's doorstep. The customer has become the focal point either to develop or maintain
stability in the business. Every engagement with the customer is an opportunity to either
develop or destroy a customer’s faith in the Bank SBI presents a wide range of products and
service for its customers. It include saving account, credit card, fixed deposit, home loan,
Personal loan, debit card, loan against property, Car loan, gold loan and more let us learn
about these in some details.
Today customers are now becoming increasingly conscious of their right and are
demanding ever more than before. Now days most of the bank are shifting from a “product
centric model” to a customer centric model. Hence this study focus on customer services
quality of SBI bank in manjeri municipality.
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1.2 Importance of study
In Kerala, most of the people prefer SBI bank over other banks for their banking service. SBI
bank is known for its quality and the array of services provided by it all over the country. In
order to retain the valued customers, it’s important to enhance the customer satisfaction and
experience through the quality of services. The service quality as well as service value plays a
vital role in instituting customer loyalty.
This study focuses on the quality of various services provided by the SBI bank and the
satisfaction of SBI customers. The important factors influencing the satisfaction of
customers-speedy transactions with accuracy, expertise of employees, maintain secrecy and
waiting time of customers to complete the transaction, as well the quality of services
provided by the bank are included in the study
1.3Statement of problem
Service marketers have really understood the competition can well managed by
differentiating through service quality. Significance of service lies in customer service
management. The service quality play a vital role in banking sector. The bank has differ the
one bank with another bank with regard to the parameters of service quality. On the basis of
above statement the researcher has to take necessary steps to prove the certain questions, an
attempt is made to study the customer service quality of SBI bank. This project deals with
consumer service quality of SBI customers with special reference to Manjeri municipality
and to know why they choose SBI bank. This study would stand as a sincere attempt to
evaluate the service quality of SBI customers.
Primary objective
Secondary objectives
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To study the level of customer satisfaction towards the service provided by the SBI.
To identify the factor those influences the selection of SBI banking services.
To make suggestions for improving the banks customer services.
To find out the types of banking services availed by the customers.
The methodology followed for conducting study includes the population of study, sample
size, source of data, and tools for analysis, tools for presentation and tools for data collection.
The SBI account holders in Manjeri municipality are taken as population of study.
Source of data: For this study both primary data and secondary data are used. Primary dataare
collected directly from 50 customer of SBI bank in Manjeri municipality. Secondary data
collected from books and website etc.
Primary data are the first hand data which are collected fresh for first time and happen to be
original in character. Questionnaire has been used as a tool for the data collection.
Simple percentage method, weighted ranking are used for analyzing the collected data.
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The tools used for presenting data here is diagrams, charts and tables.
The primary data survey has been carried during the period from December 2018 to
February 2019.
1.8 CHAPTERIZATION
Chapter1- introduction
This chapter deals with introduction, importance of the study, statement of the
problem, objectives of the study, methodology, limitation and chapter.
Chapter 2- Review literature
This chapter includes review of related literature.
Chapter3- Theoretical background of the study
This chapter includes the background of the study.
Chapter4 – analysis of the study
This chapter deals with the analysis of data collected from respondents. The
collected data will be tabulated and analyzed.
Chapter5 – summery, findings, suggestions and conclusion
This is the concluding chapter, which is the finding and conclusion of the
chapter.
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Introduction
This chapter deals with earlier research report summary, Report are related with our topic. No
researcher can do justice with the researcher problem at hand unless one is having proper
understanding of all its related aspects. Academician and researchers have carry out a number
of studies on consumer preference of durable goods and customer preference of particular
showrooms. To take up the area the researcher has scanned the available literature and would
concentrate here on the important studies related this topic.
Jarmo Lehtinen views service quality in terms of physical quality, corporate (image) quality
and interactive quality. Physical quality refers to the tangible aspects of the service.
Corporate quality refers s to how current and potential customers, as well as other publics,
view (image) the service provider. Interactive quality concerns the interactive nature of the
service and refers to a two-way flow that occurs between service provider and the customer,
or her/his representative; including both animated and automated inter actions. (Lehtinen &
Lehtinen, 1982)
Parasuraman et al (1985) derived ten dimensions that influence service quality from what
they suggested that quality evaluations are not made exclusively on the outcome of service.
Moreover they also involved evaluations of the service delivery process. The first dimension,
when evaluation happens after service performance, focuses on “what” service is delivered
and called outcome quality. The second dimension, process quality is when the evaluation
occurs while the service is being performed. In 1988 they presented a definition of service
quality which is “the degree of discrepancy between customers‟ normative expectations for
the service and their perceptions of the service performance” (Parasuraman et al, 1988).The
Seroquel scale is the principal instrument for assessing quality encountered in the services
marketing literature. This instrument has been widely utilized by both managers
(Parasuraman, Zeithaml and Berry,1991) and academics (Babakus and Boller, 1992;
Carman, 1990) to assess customer perceptions of service quality for a variety of services (e.g.
banks, credit card companies, and repair and maintenance companies). The results of the
initial published application of the Seroquel instrument indicated five dimensions of service
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quality which emerged across a variety of services. These dimensions include tangibles,
reliability, responsiveness, assurance and empathy (Zenithal, Parasuraman and Berry,
1990:176; Bren singer and Lambert, 1990; Crompton and MacKay, 1989). Tangibles are the
physical evidence of service, reliability involves consistency of performance and
dependability, responsiveness concerns the willingness or readiness of employees to provide
services, assurance corresponds to the knowledge and courtesy of employees and their ability
to inspire trust and confidence, and finally, empathy pertains to the caring, individualized
attention that a firm provides. It customers (Lassar, Manolis and Winsor, 2000:245-246).
Levesque and McDougall (1996)10 explored the consequences of service quality, service
features and customer complaint handling on customer satisfaction in the Canadian retail
banking sector. Based on their empirical analysis, they have concluded that the determinants
of satisfaction in retail banking are driven by a number of factors which also include service
quality dimensions. The service provider’s offering could be expected to affect overall
customer satisfaction and had a strong bearing.
Navdeep Aggarwal and Mohit Gupta (2003)- This study basically finds out the primary
dimensions and sub dimensions of service quality. Informal structured interviews are
conducted with branch managers and academicians to formulate a banking service quality
model. The study found out that service time and personal interactions are very important
along with ambience for service quality
Sandip Gosh Hasra and BL Srivastava (2009) in their study indicated that the bank should
pay attention to these dimension of service quality and pay more attention to dimension of
assurance empathy to increase loyalty to a company, willingness to pay, customer
commitment and customer trust.
Pim den Hertog et al., (2010) are used to study the research objectives. An analysis has been
carried out by applying the above models to identify and compare various strategies adopted
so far by the above banks keeping in tune with the selected models.
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quality. The study also found out that banks differed in the service quality parameters
Ladharetal. (2011) also found the difference between the Canadian and Tunisian customers
in their perception of importance of service quality dimensions.
Arun& kumar.G, Dr.S.J.Manjunath (2012) Service quality plays a major role in customer
satisfaction and creating brand loyalty in banking sector. The data were analyzed by one
sample t-test and regression analysis. The result revealed that all the dimensions which have
been used in the study are positively related to customer satisfaction
Aghdaie ASF, Faghani F (2012): Mobile banking service quality and customer satisfaction.
International Journal Management Business Research 2: 351-361.
Paul S. Gudadhe (2013) the selected customers seem representative and large enough to
generalize the total population although from Rural and Urban banks of Yavatmal district.
Generally the customers of SBI of Yavatmal district were the depositors, borrowers and
others who avail banking services.
Anita and Mahavir Singh (2013)84 made an attempt to ascertain from the customers the
type of bank they would prefer for operating their accounts; to identify the various types of
services offered by banks which the customers are presently availing and which types of
services are preferred over others; to check the level of satisfaction about the different types
of services offered by the banks; to ascertain the ideal level of services which they expect
from the bank and to identify the extent of segmentation gap among the services offered. The
study was undertaken in respect of 300 bank customers of Kurukshetra city. The primary data
were collected with the help of questionnaire. The findings of the study documented that the
majority of customers prefer to have accounts both with private and public-sector banks, that
relatively younger people prefer private-sector banks. The stud has further revealed that the
level of customer satisfaction varies across different types of services offered by banks and
the level of expectations of the customers. The study suggests that commercial banks need to
improve their services in different areas. The amount of documentation required also needs to
be re-examined.
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THEORETICAL BACKGROUND
Banks are the most important financial institutions in the economy. They are the principal
source of credit (loanable funds) for millions of families and for many units of government
(school districts, cities, countries etc.). Banks plays major role in the economic development
process. The country's economy depends upon the efficient functioning of the banking
system.
Banks are the financial service firms, producing and selling professional management of the
public's funds and performing many other roles in the economy. Earlier, the services offered
by banks included currency exchange, savings deposits, discounting commercial notes and
making business loans, supporting government activities with credit, safekeeping of valuables
and certification of value, offering trust services, offering checking accounts (demand
deposits) etc. The services banks have developed more recently are granting consumer loans,
financial advising, offering equipment leasing, making venture capital loans, selling
insurance services, selling retirement plans, offering security brokerage and security
underwriting services. The Indian banking system had gone through a series of cries and
consequent bank failures and thus its growth was quite slow during the first half of this
century. But after Independence, the Indian banking system has recorded rapid progress. This
was due to planned economic growth, increase in money supply, growth of banking habit,
control and guidance by the Reserve bank of India, and above all, nationalization of 14 banks
in July 1969.1 The bill introduced in the Legislative Assembly in 1933 resulted in creation of
the Central Bank or Reserve Bank of India, which commenced its operations from 1st April
1935. The RBI performs almost all traditional central banking functions and also undertakes
some developmental and promotional functions. In 1949, two major developments took
place. First, the enactment of the Banking Regulation Act, which gave extensive regulatory
powers to the Reserve Bank of India over the commercial banks. Second, the nationalization
of Reserve Bank, mainly to have close integration between the policies of the Reserve Bank
and those of the Government. In terms of the Reserve Bank (Transfer to Public Ownership)
Act, 1948, the entire share capital of the Bank was acquired by the Central Government.
From 1st January 1949, the Reserve Bank began functioning as a State-owned and State
controlled Central Bank.2 These two major developments immediately after the attainment of
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independence period proved to be the turning points in India's Commercial Banking. The
Banking Regulation Act, 1949 defines Banking as "accepting, for the purpose of lending or
investment of deposits of money from the public, repayable on demand or otherwise and
withdrawal by cheques, draft, and order or otherwise." 3 Commercial banks are organized on
a joint stock company system, primarily for the purpose of earning a profit. The Indian joint-
stock banks form an important constituent of the Indian Money market. A joint-stock bank
may be defined as any company which accepts for the purpose of lending or investment of
deposits of money from the public, repayable on demand or otherwise and withdrawal by
cheque, draft, order or otherwise. The joint-stock banks are classified by the Reserve Bank of
India as scheduled banks and non-scheduled banks. Banks with a paid-up capital and reserves
of over Rs.5 Lakhs and which are included in the second schedule of the Reserve Bank of
India Act are known as scheduled banks while banks which do not fall under this category are
known as non-scheduled banks. Indian joint-stock banks are only those scheduled banks
registered under the Indian Companies Act.4
Banking is a service oriented industry which is fast moving from a seller’s market into a
buyer’s market. Banks are also adapting their systems, procedures, policies and thinking to
the felt needs of their customers as the depositors or borrowers. They are also trying hard to
meet the perception of customers who increasingly articulate their needs and grievances. All
customers expect bank and bankers to be polite, courteous, helpful and understanding. They
also expect to be treated as important individuals. Generally they would be satisfied if
prompt, accurate and speedy attention is given to their work and banking problems.
Customers do not like a banker if he is rigid, inflexible and unhelpful in his approach. He is
also disliked if he is too rules bound. 1 Customer service in banks is a significant concept. It
is natural for banks to compete with one another in winning over the customers. In a
competitive environment not only winning new customers but also retaining the existing
customer base assumes greater importance. It is much more profitable and cost effective to
retain the customers rather than getting new customers. A successful bank of the future will
be the one that excels in customer service, provides the customers a range of service and
products and does continuous exercise in providing its potential to serve better. The service
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standards of Indian banks have improved with the entry of private banks and introduction of
technology driven delivery channels. This has resulted in continuous rise of expectations of
the customers. The product features and technology are not the only differentiators anymore
and the service attitude of the frontline staff plays a vital role in differentiating banks
amongst themselves. World over, the technology driven key delivery channels such as ATM,
net banking and mobile banking have reduced walk-in customers to the bank branches.
However, in India, it is observed that the customers still find it difficult to use these
technology based channels and they are more comfortable in transacting banking business
traditionally over-the-counters personally to ensure error-free and risk-free banking service.
The ever increasing customers at the bank branches will pose new challenges in the area of
customer service at the front office. While struggling to provide better and efficient service
at the counters, the staffs are also confronted with various regulatory norms to mitigate risks
in operations. There is a general tendency in frontline to avert any risk. The fear of errors
and monetary risk involved in processing the transaction suppresses ‘service attitude’ in the
front office.2
The first banks were The General Bank of India started in 1786 and Bank of Hindustan
started in 1790; both are now defunct. The oldest bank in existence in India is the State Bank
of India, which originated in the Bank of Calcutta in June 1806, which almost immediately
became the Bank of Bengal. This was one of the three presidency banks, the other two being
the Bank of Bombay and the Bank of Madras, all three of which were established under
charters from the British East India Company. For many years the Presidency banks acted as
quasi, central banks, as did their successors. The three banks merged in 1921 to form the
Imperial Bank of India, which, upon India's independence, became the State Bank of India in
1955. Indian merchants in [Calcutta] established the Union Bank in 1839, but it failed in
1848 as a consequence of the economic crisis of 1848-49. The Allahabad Bank, established in
1865 and still functioning today, is the oldest Joint Stock bank in India. Then the Bank of
Upper India was established in 1863 survived until 1913. 2 Foreign banks too started to
approach, particularly in Calcutta, in the 1860s. The Compote d’Escompte de Paris opened a
branch in Calcutta in 1860, and another in Bombay in 1862 with branches in Madras and
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Pondicherry, then a French colony, followed. HSBC established itself in Bengal in 1869.The
first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881 in
Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in
1895, which has survived to the present and is now one of the largest banks in India. Around
the turn of the 20th Century, the Indian economy was passing through a relative period of
stability. Indians established small banks, most of which served particular ethnic and
religious communities. The presidency banks dominated banking in India but there were also
some exchange banks and a number of Indian joint stock banks. All these banks operated in
different segments of the economy. Indian joint stock banks were generally undercapitalized
and lacked the experience and maturity to compete with the presidency and exchange banks.
This segmentation let Lord Curzon to observe, "In respect of banking it seems we are behind
the times. We are like some old fashioned sailing ship, divided by solid wooden bulkheads
into separate and cumbersome compartments."
The period between 1906 and 1911, saw the establishment of banks inspired by the Swadeshi
movement. The Swadeshi movement inspired local businessmen and political figures to
found banks for the Indian community. A number of banks established then have survived to
the present such as Bank of India, Corporation Bank, Indian Bank, Bank of Baroda, Canara
Bank and Central Bank of India. Until the independence of India, it was challenging for
Indian banking.
Nationalization of Banks:
In the two decades following the enactment of the Banking Regulation Act, 1949, the Indian
banking system developed in many respects. It grew geographically, structurally and
functionally. Judged on the basis of deposit mobilization, commercial banks made a
considerable progress in the period. Before the Banking Regulation Act, 1949 came into
existence, banking system in India suffered for the following reasons: 5
1. Indian Joint-stock banks during the early part of the century carried out varied nature of
the transactions, which could never be characterized as banking transactions.
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2. According to the original provisions, it was possible for a bank with only one place of
business to be started with as low a capital as Rs.50,OOO without any specifications for
branches.
3. There was no consistency in balancing paid-up capital and reserves of commercial banks
with the increase in deposits brought about by the growing economic activity during the
past years. To satisfy the shareholders, banks used to declare large dividends, thus
undermining sound banking principles.
4. Ignorant public were shown large figures of authorized capital as against very fractional
amounts of paid-up capital and thus could be easily misled by certain unscrupulous
bankers. The promoters of banking companies used to persuade persons to purchase a
very large number of shares than they could actually afford to and also by calling only a
small portion of the subscribed capital. For instance, the Poona Bank which went into
liquidation in 1924 had an authorized capital of Rs.10 crores as against a subscribed
capital of Rs.50 Lakhs and a paid-up capital of Rs.3 Lakhs.
5. Inter looking directorates (same person appointed as director for more than one bank)
paved way of mismanagement.
The nationalization of 14 major banks with deposits of Rs.50 crores or more in July in 1969
was a historic and momentous event in the history of India. Before the steps of
nationalization of Indian banks, only State Bank of India (SBI) was nationalized. The origin
of the State Bank of India goes back to the first decade of the nineteenth century with the
establishment of the Bank of Calcutta in Calcutta on 2nd June 1806. Three years later, the
bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A
unique institution, it was the first joint-stock bank of British India sponsored by the
Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1
July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern
banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921.
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MASS BANKING
After nationalization in 1969 and 1980, banking in India has witnessed a major
metamorphosis from class banking to mass banking. The motto of bank nationalization was
to make banking service reach the masses that can be described as “First Bank Revolution”.5
SOCIAL BANKING
Social banking policies started in the 1950s culminated in the social control of banks in 1968
to ensure equitable and purposeful distribution of credit within the resources available,
keeping in view the relative priorities of development needs. However, it was felt that the
social control cannot sustain in equitable distribution of bank credit and facilitates to main
sectors of the economy and finally it led to the nationalization of banks in 1969. It was aimed
at mobilizing deposits and to ensure availability of credit to hitherto neglected areas of the
society. Thus the social banking began with inclusion of neglected sections in concern with
employment generation and economic development of those areas. Post nationalization saw
a rapid expansion of branches in areas and availability of credit to hitherto neglected sections.
Various agencies were set up to direct credit and other banking facilities. As a part of social
banking, the nationalized banks were entrusted with the task of actively promoting the growth
of new and progressive enterprises with a view to create opportunities in increasing scale in
the neglected and backward sectors in various parts of the country. The social banking
awareness consists of expansion of banking activities particularly in semi-urban and rural
areas. The banking and social lending were more concerned with the economic parameters
such as employment, income generation and so on.
Commercial banks extended their services to a large numbers of customers. Banks were
involved in social upliftment, priority sector lending and extending banking services to
unbanked areas and providing variety of services.
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TECHNOLOGY PHASE IN CUSTOMER SERVICES
Extensive spread of bank branches and diversification of banking services in India over the
past one decade present different challenges in the areas of customer service, speedy disposal
of credit proposals, reconciliation of inter branch office transactions,
productivity/profitability, better control and audit and management information system
required for quick decision making. For meeting these emerging challenges it is essential to
ensure branch level computerization or up gradation of technology and networking of the
branches with their controlling office and the head office. The objectives of the RBI’s
response to those challenges facing the banking industry have been directed towards
improvements and implementing an effective electronic network providing a robust, secure
and reliable communication backbone for the banking system.
Deposit Mobilization:
At the time of first nationalization, the total deposits of all scheduled commercial banks were
about Rs.5, 000 crores. The Indian banking system prior to the Banking Regulation Act was
not very sound. There were many small banks with unscrupulous management. However,
after the Banking Regulation Act, following the nationalization, there was a phenomenal rise
in bank deposits of scheduled commercial banks. Aggregate bank deposits on last Friday of
March 1991 were Rs. 1,92,541 crores as against Rs. 4,665 crores in July 1969.
Bank Credit:
Post nationalization of 14 banks, substantial amounts of loans have been given for
agricultural operations. Total bank credit stood at Rs.1,16,301 crores on last Friday of March
1991. Since nationalization of 14 major banks, there has been spectacular rise in bank credit.
In July 1969 it was only Rs.3,399 crores. Over a period of 22 years bank credit had steadily
increased and was more than 34 times in March 1991 of what it was at the time of
nationalization of banks.
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Need for loans to finance higher education
Higher education occupies a low priority in public expenditures. Its share of GNP was nearly
1 percent during the 1970s, just 0.35% in the mid-1990s before increasing modestly to 0.6 by
the end of the decade. Although total expenditure on higher education has risen since
independence from 483 crores to 2418.3 crores between 1980 and 1995, spending per pupil in
real terms declined for nearly two decades, before recovering modestly. The degree to which
states have allowed private higher education institutions varies considerably. The number is
greatest in the Southern states and Maharashtra, and least in states like Bihar and West
Bengal. According to NSS data, the government's share in overall education expenditure has
been declining steadily, from 80 percent in 1983 to 67 percent in 1999. For states like Kerala,
the decline is steep, from 75 to 48 percent, while for Madhya Pradesh it is from 84 percent to
68 percent. Indeed, while private expenditure on education has risen 10.8 times in the last 16
years, that for the poor rose even faster, by 12.4 times. However, the most noticeable trend
has been the transformation in the provision of professional education, especially
engineering, medicine and business schools. Indians are spending between Rs. 3000-5000
crores (roughly $700 million to $1 billion) on higher education abroad, a staggering amount
for a poor country whose own educational institutions are starved of resources.
Public expenditure
Total expenditure on higher education has increased remarkably during the post-
independence period. At the inception of Planning in the country India spend barely Rs.17
crores on higher education. However, more than offset by increase in prices, and increase in
population and student numbers in higher education, the government expenditure increased
considerably. The trends suggest that expenditure on higher education had a good start during
the 1950s, the growth was erratic during the 1980s. With the economic reforms in 1990s, the
allocations of budgetary resources to higher education have indeed been severely affected.
The trends seem to continue in the present decade as well.
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Role of Nationalized banks in providing loan for Higher education:
Post Nationalization period witnessed rapid branch expansion in unbanked areas of district
with the result of significant increase in public sector bank branches from 8262 to 67283 in
June 2004. Bank credit also increased from Rs.3036 crores in 1969 to Rs.61 ,9660 crores in
2004. In order to regulate bank credit, Reserve Bank of India pressurized the commercial
banks to popularize loans for priority sector, which included agriculture, small scale industry,
transport, small traders and education. Banks have become more supportive in extending
loans at attractive rates of interest with simple formalities. The number of educational loans
sanctioned to students by nationalized banks has increased sharply over the past three years.
Nationalized banks are extending more loans to those students going abroad for higher
studies.
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education that have higher social advantage. Every year about 20,000 loan scholarships are
given.
The progress of any organization particularly is service. Industry organization like a bank
depends upon the quality of service offered to clients. The customers judge the employees
not from what they say and talk, but by the sincerity of approach to the customers they adopt
in serving them. Catchy slogans initially but ultimately it is efficient and prompt service that
helps banker in retaining customers patronage. Well-designed customer service must be
accompanied by good delivery. The four elements of good delivery are v Courteous acts v
Customer care v Speed v Accuracy.
Courteous Acts
Common courtesies and manners are very important, probably more important than the banks
may consider. Competence means that whoever serves the customer or whoever supports
people that serve customers has to do things and do them well. It means getting things done
rightly at the first time. It means knowing what should be done and how best it can be done.
Courtesy and competence go hand in hand - it is a license to keep customers for life time
.This is an absolutely essential requisite, which should become an inseparable component of
service, “service with smile”, people say. Extending courteous service brings the customer
close to the organization and in the process the image of the organization grows in stature.
Even when a banker has to say “No” to someone he could still be warm and courteous, not
hurting the feelings of the prospective customer. The front-line service providers are the
most visible part of any service. The front-line staff should make the customers express their
views freely and frankly and elicit their ideas. They should politely answer customers’
queries regarding their deposits/collection of instruments.
Customer care
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service in anticipation of customers’ requirements. A service or product is of high quality it
meets the demands and expectations of the customers, if the service or product can be
matched with the customer’s actual needs and expectations. The satisfaction of customer
needs depends on how far the bank optimizes its internal procedures.
Speed
Speed and time measures are very important factors to many customers. The speed with
which the banks offer their services will actually gain a competitive advantage and allow
them to offer a competitive advantage and higher satisfaction. On account of technological
revolution at present products are offered to take care of the element of “speed and time” like
internet and mobile banking, debit cards, anywhere banking, ATM and so on. A large
number of customers want that all services should be provided in minimum time. Time is
money for all customers. Leisurely and lethargic handling of the customers’ transaction is a
major block in the good delivery of customer services. Payments should be made
immediately, since service delayed is service denied. Prompt service is equated with quality
of service. It is to be understood that service time has three components:
I) Access time
Time required for the client to gain access to the banker and draw his attention.
This is the time that the customer has to wait after arriving at the bank.
This is the time required for the banker to provide the service. It is generally observed that the
banker measures only action time and does not take into account access time and queuing
time which are critical to a customer.
Accuracy
Bank staff should handle customers’ complaints very accurately. Complaints are a part of
life. A complaint is an expression of dissatisfaction, created by non-fulfillment of an
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expectation or feeling of discrimination. Prompt and sympathetic handling of complaints can
turn a disgruntled customer into a satisfied one. Customer can expect the staff to take
personal interest in their problems, apologize for mistakes and welcome feedback.
In today’s competitive scenario speed and sophistication are the essentials of banking
service. Here comes the value of computer technology which is widely acknowledged to be
the major enabling banking environment in the country. Computer technology is used not
only to improve the operational efficiency, but also to change the very nature of banking.
Bank computerization was started with the signing of the mechanization agreement by the
IBA with trade unions in the year 1983. The technology changes have put forth the
competition among the banks. This has led to increasing total banking automation in the
Indian banking industry. New private sector banks and foreign banks have an edge over
public sector banks as far as implementation of technological solutions is concerned.
However, the latter are in the process of making huge investment in technology.
The financial reforms that were initiated in the early 90s and the globalization and
liberalization measures brought in completely new operating environment to the banks.
Services and product like “Anywhere Banking,” “Telebanking,” “Internet Banking,” ”Web
Banking,” “E-Banking” and so on, have become the buzzwords of the day and the banks are
trying to cope with the competition by offering innovative and attractively packaged
technology based services to their customers.1 Some of the innovations that are made
possible on account of the infusion of computerization are described below.
Total Branch Automation enables customers to transact all their banking work through a
single counter instead of going to different counters on the premises. TBA helps significantly
in improving the efficiency of operations.
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The Automated Teller Machine (ATM) is seen everywhere. This machine has brought
innovations in the Banking sector all over the world. The customers are no more dependents
on the brick and mortar branch of a Bank. The advent of the ATM has made the concept of
“24 X 7 – 365 days banking” a reality. The ATM has been helpful to both the bankers and
the customers. The long crowd of customers in the banking hall of a branch waiting for their
turn to collect cash is disappearing. The branch business timings have lost significance to the
customer after the introduction of the ATM. The ATM is a device used by bank customers to
process account transactions. The customer inserts into the ATM, a plastic card that is
encoded with information on a magnetic strip. The strip contains an identification code that
is transmitted to the bank’s central computer by modem. Every card holder would be given a
PIN (personal identification number) that he should enter and after verifying the same with
the records, the ATM would allow operations.
The electronic funds transfer device enables early realization and transfer of funds between
different centers on the same or the next day through electronic mail or satellite networks.
• Tele-banking
In tele-banking, the customer is essentially identified through a code. The customers can
access the Voice Mail System of the bank to obtain certain information such as account
balance and status of debit/credit to certain cheques. The customer can do many of his non-
cash related transaction over the telephone.
• Mobile Banking
20
These machines dispense a fixed amount of cash as soon as a pre-printed voucher is inserted
into the machine.
• Plastic cards
Credit card is a method of payment without the use of cheque or cash is gradually giving
ways to improved version such as debit cards, smart card and co- branded cards.
• Internet Banking
Efforts are underway whereby a customer can route most of the transactions through his/her
personal computer, which will be up-linked with the mainframe computer of the bank.
Information technology is absolutely essential for the overall progress in the banking sector.
Technology introduction by itself will have certain effects on the process. Appropriate
technology shall smooth the processes of financial intermediation, develop an efficient
payment system, improve customer service, handle larger volumes, and generate efficient
MIS and so on.
The absorption of technology in Indian Banking scenario has witnessed a gradual but steady
transgression in the last two decades. In the branch banking segment, the transformation
from the Ledger Posting Machines (LPMs) Advanced Ledge Posting Machines (ALPM) and
Local Area Network (LAN) to the contemporary Wide Area Network (WAN), centralized
Core Banking Solution (CBS) and extensive Automated Teller Machine (ATM) networks
opened up rewarding avenues for the Banks to explore. Needless to mention, the directives
of the Central Vigilance Commission to achieve cent percent computerization before 31st
December 2004 also hastened up the computerization drive in Indian Banks.
In Indian banking scenario, there are two distinct groups as far as infusion of technology is
concerned. The public sector banks (PSBs) which command over three quarters of the
marker share and old generation private banks (OGPSBs) who are relatively smaller entities
form the first group. These banks were very 100 slow in imbibing technology in their
operations, had a large branch network spread over the length and breadth of the country.
21
The second group which consists of the new generation private sector banks (NGPSBs) and
Foreign banks (FBs) were early adopters of technology in their operations. The issues
relating to technology therefore are distinctly different for these two groups of banking
organizations with the latter being able to introduce technology in their operations with
relative ease as they started disposal and with their operations being mainly restricted to the
urban metropolitan areas. The bank being essentially the processor of information in large
quantities, Information Technology (IT) is used to achieve the following:
I. Ability to handle large volume of business with the desired level of efficiency.
• Smart cards
The arrival of the smart card technology has opened up a new world of application in the
banking sector. This card, the size of a visiting card, with a computer processor and memory
built in with a vast range of applications which will revolutionize banking in India. The
smart card can be used as a portable pass book for the holder’s bank account storing the
current balance without the need for a central computer and telecom lines connecting the
branches. The bank is able to provide the service that a customer desires, draw cash, make
deposits or enquire about the balance in his account at any branch of the bank in any city,
town, or village regardless of where an account is primarily maintained.
• Multimedia
Multimedia is the most significant advancement in Information Technology (IT) since the PC
revolution.
• E – Mail
Information is exchanged through electronic media. Such exchange takes place between
remote locations or within the office. The linking devices are facsimile, teletypewriter,
computer and any other electronic device. It is very useful to the NRI customers to transfer
22
funds directly to their accounts without manual intervention. This is one of the least costly
methods of transmission.
• Bank Net
It means transmission of data quickly and effectively between the RBI and various banks.
The transmission line of the Department of Telecommunication largely terrestrial (pertaining
to the various branches) is used.
Customers can en cash their cheque in any of the branches with the help of the technological
network. The images of the cheque are transmitted through the bank’s e-mail.
• Internet
Internet is World Wide Web (WWW) of the interconnected computerized networks. Simply,
it is a network of networks. It provides information service of products and services and
helps to reach existing customers and prospective customers across the world.
23
ANALYSIS AND INTERPRETATION
The present chapter analyses the data and deals with the application of statistical tools,
interprets the facts and figure to derive logical inferences
Table 4.1
AGE CLASSIFICATION
Male
Female
Chart 4.1
From the table 4.2 it can be seen that the customers having favorable attitude is more in case
of those belonging to the age group of 21-30 and less in the case of age group less 31-40.
24
Table 4.2
GENDER CLASSIFICATION
Male
Female
Chart 4.2
From the above chart 4.2 it is clear that out of 50 respondents, 34 % are male and 66 % are
female.
25
Table 4.3
OCCUPATION STATUS
60
50
40
30
20
10
0
Self employed Home maker Government Others
employee
Chart 4.3
The above chart 4.3 show that nearly 48 percent of the respondents belong to others, 28
percent belongs to self-employed only 8 percent belongs to home maker.
26
Table 4.4
FAMILY TYPE
80
70
60
50
40
30
20
10
0
Joint family Nuclear type
Chart 4.4
The chart 4.5 reveals that the 80 percent respondents are nuclear family and 20 percent are
joint family.
27
Table 4.5
MONTHLY INCOME
Below 10000
10001-25000
25001-50000
Above 50000
Chart 4.5
The above chart shows that most of the respondent’s monthly income is within the range of
Rs. 10001-20000. 40 percent and 22 percent respondents monthly income is RS 25001-50000
and 20 percent respondent are below Rs 10000 and 18 percent respondents income is above
Rs.50000.
28
Table 4.6
30
25
20
15
10
5
0
I have a The brand The excellent ATM service Net banking Location
traditional name of the service services advantages
bank a/c bank provided this
with same bank
bank
Table 4.6
The table 4.6 shows that (28%) most of the SBI customers select ATM service as the primary
reason to choose SBI bank.
29
Table 4.7
60
40
20
Series1
0
Saving Current NRI account Fixed deposit Others
account account
Chart 4.7
The above chart 4.7 shows that 58 percent of respondent are using saving account and NRI
account has the least (2%) no. of users.
30
Table 4.8
40
30
20
10
0
1 year
1-2 year
2-3 year
3-4 year
Above 4
Chart 4.8
The above chart 4.8 shows that most of the respondents are using this account above 4 year
and 4 percentage of respondent are using SBI bank account for 1 year.
31
Table 4.9
45
40
35
30
25
20
15
10
5
0
Excellent Very Good Average Poor Very poor
good
Chart 4.9
The above chart 4.9 shows that 42 percent respondents agree that the quality of SBI bank
service is good. 40 percentage are of the opinion that service is very good and none of
respondent says that quality of service is very poor.
32
Table 4.10
Yes
No
Not aware
Chart 4.10
The table 4.10 shows that 60 percent are using core banking facility 24 percent respondent
are not aware and only 24 percentage is not using core banking facility .
33
Table 4.11
70
60
50
40
30
20
10
0
Loan facility Overdraft ATM facility Others
Chart 4.11
The chart 4.11 shows that 62 percent of the respondent use ATM facility and the least of the
respondents (10%) depend upon overdraft and other facilities.
34
Table 4.12
60
50
40
30
20
10
0
Yes No
Chart 4.12
The chart 4.12 shows that 58 percent of the respondents are of opinion that not maintaining
minimum balance 48 percent of the respondent are to maintaining the minimum balance.
35
Table 4.13
60
58
50
40 42
30
20
10
0
yes No
Chart 4.13
The above chart 4.13 shows that 58 percent of respondents are using alternative banking
service, whereas 42 percent does not use.
36
Table 4.14
yes
44%
No
56%
Chart 4.14
The above table 4.14 shows that 56 percent respondents are not wishing to shift to any
another bank and 44 percentage respondents wish to shift to other bank.
37
Table 4.15
40
30
20
10
0
To make To enquire To withdraw To get advice Any other
deposit about balance cash for specify
investment
option
Chart 4.15
The chart 4.15 shows that 40 percent respondents are visiting the branch to make deposit and
only 6 percentage respondent are visiting to get advice for investment.
38
Table 4.16
60 Yes
50
40 No
30
20
10
0
Chart 4.16
The above chart 4.16 shows that 60 percent respondents are able to use online services and
only 40 percent respondent are no able to use online services.
39
Table 4.17
60
50
40
30
20
10
0
Highly satisfied Satisfied Less satisfied Not satisfied
Chart 4.17
The chart 4.17 shows that 60 percent of respondent are satisfied,16 percent are highly
satisfied, 14 percent respondent less satisfied ,only 10 percent respondent are not satisfied.
40
Table 4.18
10%
20%
Always
Often
24%
Sometimes
Rarely
30% Never
16%
Chart 4.18
The above chart 4.18 shows that 30 percent respondent are getting prompt service in visiting
the branch and only 10 percent respondent are not getting prompt service in visiting the
branch.
41
Table 4.19
60
50
40
30
20
10
0
Immediately Within 24 Within 48 Within 3-5 More than 5
hours hours days days
Chart 4.19
The chart 4.19 shows that 52% respondents are saying that the banking problems and issues
are addressed by the bank staff within 24 hours only 6 percent within 3-5 days.
42
Table 4.20
80
60
40
20
0
Yes No
Chart 4.20
The table 4.20 shows that 64 percent respondents are wishing to recommend to friends or
relatives and only 36 percent respondents are not recommended.
43
Table 4.21
8% 4%
Excellent
Good
32%
Satisfactory
56% Need improvement
Chart 4.21
The above chart 4.21 shows that 56 percent respondents are of good opinion about the
website, 4 percent respondent are of the opinion that the website needs improvement.
44
Table 4.22
12% 6%
Excellent
28% Good
54%
Satisfactory
Need improvement
Chart 4.22
The above chart 4.22 shows that most of the respondents have good opinion regarding the
general behavior of front line staffs in SBI.
45
Table 4.23
1 Personalized banking 9 18
2 Wide branch network 21 42
3 Customer banking 12 24
4 Computerized banking 4 8
5 Core banking 4 8
Total 50 100
(Source: primary data)
42
45
40
35
30 24
25
20 18
15 8 8
10
5
0
Personalized Wide branch Customer Computerized Core banking
banking network banking banking
Chart 4.23
The above chart 4.23 shows that majority (42%) of the customers think that wide branch
network is the prominent feature that comes to their mind when they think of SBI, and the
least (8%) think of core banking and computerized banking.
46
Table 4.24
40
35
30
25
20
15
10
5
0
Locker E-banking Loan NRI service Agriculture Interest Others
facility facility package
Chart 4.24
The above chart 4.24 reveals that 36% of respondents are using service e-banking, 20 %
respondents are using locker facility, 18% respondents are using loan, 12% respondents are
using others, 8 % respondents are using agriculture facility, 4 % respondents are using NRI
services and only 2% respondents are using interest package.
47
Table 4.25
SL. Services Highly Satisfied Neutral Dissatisfied Highly Total Weighted Rank
NO satisfied dissatisfied weight average
1 Atm 28 21 1 - - 227 15 1
2 Cdm 20 5 21 4 - 191 12.7 4
3 Net banking 8 26 13 2 1 188 12.5 5
16
14
12
10
8
6
4
2
0
ATM CDM NET INTEREST E-PAY DEMAT MOBILE SAVE
BANKING PACKAGE SERVICES BANKING DEPOSIT
LOCKER
Chart 4.2
From the above chart 4.25 relating to the satisfaction level regarding various services
provided by SBI bank, most of the respondents are satisfied with the ATM facility.
48
Table 4.26
45
40
35
30
25
20
15
10
5
0
Minimization of Better Better Modern Others
service time customer care communication technology
of product
details
Chart 4.26
From the chart 4.26 it can be understood that most of the customers have suggested a need for
better customer care.
49
5.1 FINDING
Most of the respondents (48%) dealing with SBI bank are within the age group 21-
30.
66 % respondents are female and 43% are male.
Out of 50 respondents 40% have a monthly income of 10001-25000 and 18% have
income of above 50000.
It is found that the most of the people choose ATM services.
It has been observed that maximum no. of people are using the saving account of
SBI bank.
Majority of the respondents are dealing with SBI bank for more than 4 years.
42 % respondents agree that the quality of SBI bank service is good.
Customers are very much satisfied with the core banking facility.
Out of 50 respondents, 62% are using ATM facility.
58% of respondents say that they do not maintain minimum balance.
56% of the respondents are not wishing to shift to any other bank.
45% of the respondents visit the bank branch to make deposit.
60% are able to use online services.
Most of the customers are satisfied with e-banking services, around 60%.
30% use prompt service of the bank.
Banking problems and issues are addressed by the bank staff.
64% are wishing to recommend the bank to others.
Most of the people have good opinion about the website of SBI, around 56%.
54% says that general behavior of front line staff in SBI is good.
42% of the respondents are of the opinion that wide branch network is the most
attractive feature of SBI Bank.
36% respondents are using e-banking services.
15% are satisfied with ATM facility.
40% of the respondents suggested that the quality of banking services needs to be
improved.
50
5.2 SUGGESTIONS
The management of SBI should conduct more product and services awareness
campaign.
They should increase the level of providing personal attention to individual
customers.
In delivery of quality of services in bank, what matters is speed, accuracy,
promptness, reliability, individual attention etc. Better result can be achieved through
proper use of relevant banking technology.
The relationships are mostly viewed from the prospective of the firm providing
services. For services firm in case of bank, building strong relationship is important
for improving customer satisfaction through service quality.
The bank has to improve the accurate information, dependable service, redness to
solve e-banking problems, effective online facilities and updated technology of
reliability dimensions of service quality.
The bank has to improve confidentially, secured website, knowledgeable employees
of assurance dimensions of service quality
5.3 CONCLUSION
The aim of the present study was to see the customer’s services quality of SBI bank in
Manjeri municipality. This research is based on the empirical data which collected from the
customers of SBI bank in Manjeri municipality. The study also found a positive relationship
between all services quality dimensions and customer satisfaction. The result of paper
confirmed the theory of literature regarding the relationship between the service quality
dimensions and customer satisfaction.
51