A STUDY ON

CUSTOMER SATISFACTION ON EDC MACHINES

WITH REFERENCE TO

HDFC BANK LTD

HYDERABAB
A project report Submitted in Partial Fulfillment of
The Required for the Award of the Degree of

MASTER OF BUSINESS ADMINISTRATION

OF
ANDHRA UNIVERSITY
Submitted by
D.SUDHA
(H.T.No.20854100008)

Under the Esteemed Guidance of

Smt.A. Vijaya Bhargavi M.B.A.,
Faculty in M.B.A Department

DEPARTMENT OF MASTER OF BUSINESS ADMINISTRATION

ADITYA INSTITUTE OF P.G STUDIES
(Approved by AICTE, Affiliated to AU, & Accredited by NBA)
Aditya Nagar, ADB Road, SURAMPALEM-533437
2008-10

ADITYA INSTITUTE OF P.G.STUDIES

DEPARTMENT OF BUSINESS MANAGEMENT
(Affiliated To Andhra University)
Aditya Nagar, ADB Road, SURAMPALEM-53343, E.G.Dt
Phones :( 08852)252243, 252250, cell: 9866576662
---------------------------------------------------------------------------------------------------------

CERTIFICATE

This is to certify that the project entitled CUSTOMER SATISFACTION with

reference to HDFC BANK LTD, HYDERABAD is the bonafide work done by
Miss.D.SUDHA with Regd.no:20854100008 during the period 2008-10 in partial fulfillment
of the requirement for the award of the Degree of MASTER OF BUSINESS
ADMINISTRATION in Aditya institute of P.G studies affiliated to Andhra University is a
record of bonified work carried out by under my guidance and supervision.

Project Guide
Smt. A. Vijaya BHARGAVI

Head of the dept.

Mr. J.Nagendra Kumar

DECLARATION

I hereby declare that the project report entitled A STUDY ON CUSTOMER

SATISFACTION with reference to HDFC BANK LIMITED, HYDERABAD submitted
for the degree of Master of Business Administration is my original work and has not formed
the basis for the award of any degree, diploma, associate ship, fellowship (or) similar other
titles. It has not been submitted to any other University or Institution for the award of M.B.A.

Date:
Place : Surampalem.
(D.SUDHA)

ACKNOWLEDGEMENT
I should take the responsibility to acknowledge the following distinguished
personalities who graciously allowed me to carry out this project work successively.
I am also thankful to all other members of the staff for their kind cooperation in
this behalf. Mainly I am very much thankful to Mr. J.Nagendra Kumar, M.B.A, and Head of
the department of management studies.
I am highly thankful to my guide Smt. A. Vijaya Bhargavi madam, faculty in
management studies for her valuable advices and encouragement throughout the course.
I express my deep sense of gratitude to Sri Mr.K.Prabhakr (BRANCH MANAGER)
for his kind help and valuable suggestions in preparing this project and also to office staff
members.
I also express my sincere thanks to my friends and classmates for their advice
and suggestions in giving a proper shape to study.

Place: Surampalem
Date:

(D.SUDHA)

CONTENTS
CHAPTER-I
INTRODUCTION

1-8

INDUSTRY PROFILE

9- 14

COMPANY PROFILE

15 - 51

CHAPTER-II

CHAPTER-III

CHAPTER-IV
THEORETICAL FRAMEWORK OF CUSTOMER 52 - 64
SATISFECTION
CHAPTER-V
DATA ANALYSIS & INTERPRETATION

65 - 79

CHAPTER-VI
FINDINGS

80

SUGGESTIONS

81

CONCLUSION

82

APPENDIX
QUESTIONNAIRE
BIBLIOGRAPHY

CHAPTER 1
INTRODUCTIO
N

INTRODUCTION
Marketing is not really an activity which should be looked upon in vacuum or
isolation. It is in essence taking view of the whole business organization and its ultimate
objectives. Concern for marketing must penetrate all areas of the enterprises. Marketing
emphasizes the belief, handed down for a long time by good marketing people, that the
customer is the king and is satisfaction must be the ultimate aim of a business activity, if the
business unit desires continuous success over a long period of time it is because of this that all
business thinking in management must start with identification of a need of a group of likely
customers or persons. This needs to identification of the type of product or service to be
offered. The product or service is aimed at satisfying the needs of a host of decisions and
activities known as the marketing mix directed to secure consumer satisfaction as well as
profitability for the organization.
It is important to understand that marketing is much more than selling or advertising,
although these do form part of the marketing function.

THE AMERICAN MARKETING ASSOCIATION:

Marketing is the performance of business activities that directs the flow
of goods and services from producer to consumer or user
This definition is undoubtedly an improvement on describing marketing as selling as it
shows that marketing does encompass other activities besides selling.
Schematically, this definition can be reproduced as shown below.
1

PRODUCER
Product

CONSUMER
Need

Marketing Activities

MARKETING CONCEPTS AND TOOLS

Marketing boasts a rich array of concepts and tools. We will first Define marketing, and
then describe its major concepts and tools.

DEFINING MARKETING
We can distinguish between a social and a managerial definition of marketing. A
social definition shows the role marketing plays in society. One marketer said that marketings
role is to deliver a higher standard of living. Here is a social definition that serves our
purpose: Marketing is a social process by which individuals and groups obtain what they need
and want through creating, offering and freely exchanging products and services of value with
others. For a managerial definition, marketing has often been described as the art of selling
products, but people are surprised when they hear that the most important part of marketing
is not selling. Selling is only tip of the marketing iceberg.
Peter Drucker, a leading management theorist, puts it this way:
They will always, one can assume, be need for some selling. But the aim of marketing
is to make selling superfluous. The aim of marketing is to know and understand the customer
so well that the product or service fits him and sells itself. Ideally, marketing should result in a
customer who is ready to buy. All that should be needed then is to make the product or service
available.

OBJECTIVES OF THE STUDY

The following are the specific objectives of customer satisfaction

To know the customer satisfaction on EDC machines.

To know who are providing best services.
To know the Rents and Rates of HDFC bank.

To know how long they can use these EDC machines.

To know the opinion of the customers about the HDFC.

To know how many banks are providing this service?

To know the satisfaction of the customers.

To know which bank service is more beneficial to customers.

NEED OF THE STUDY

It has become difficult for a customer to select a particular brand.

Due to this

tremendous competition; companies now go for value added service, customer satisfaction and
excellent product or service features. In the late 1980s DickSchaaf together with Ron Zemke
wrote the landmark book the Service Edge, which described the state of the service art. Years
later he proposed a follow-up of the book curious about what happened to the 101 exemplary
service companies and found them pushing the concept into new areas and challenging the
basic assumptions about service.
It can be called Customer service, Service quality, and Customer retention. Business
coming back, Full circle to the customer. Service, of course hasnt gone away while people
have been preoccupied with things like quality and teams. Theyve continued to proclaim its
importance all along, even if a lot of attention has been somewhat diverted by more pressing
concerns.

METHODOLOGY
The method of the study is through collection, study and analysis of data collected
from various sources and publications about the industry and company and also from the
internal sources with in the company. The data is collected mainly from the consumers.
The methodology of the study has involved the gathering of information initially from
the two sources.
* Primary data
* Secondary data.

PRIMARY DATA:
Primary data is collected with the help of finalized questionnaire, which includes first
hand collection of information from consumers. It can be viewed as survey. The questionnaire
was especially designed to find the consumer behavior. Most of the information is collected by
meeting the consumers at different areas in Hyderabad.

SECONDARY DATA:
Information was gathered from company records, annual reports of company,
periodicals, and articles and prescribed books.
After gathering the data from these two sources the data was analyzed tabulated,
interpretation was written down and finally suggestions were made regarding the entire project
a simple random sample of consumer has been taken from the particular area.

DATA ANALYSIS:
A careful analysis on the obtained data has been tabulated and conclusions have been
given with help of simple statistical techniques like percentage.
6Effective marketing research involves the six steps as shown beside.
Defining the problem, the decision alternatives, and The Research objectives is the first
activity of the marketing research process. Marketing management must be careful no to
define the problem too broadly or too narrowly for the marketing researcher.
Developing the research plan is the second stage. It calls for developing the most efficient plan
for gathering the needed information. The marketing manager needs to know the cost of the
research plan before approving it. Here the best-suited method for collecting information is
selected.
Different survey techniques are followed.
Collecting the information is the data collection phase. The data is collected through the
selected method. Many Recent technical advances permitted marketers to research the sales.
Information resources have improved. The data collected to be analyzed and findings are
extracted from the collected data. The Researcher tabulates and develops the data. The
researcher presents the findings that are relevant to the major marketing decisions facing
management. Decision-making is the last step. The managers who commissioned the research
know that the findings could suffer from a variety of errors. They may even decide to study
the issues further and do more research. The decision is theirs.

SIGNIFICANCE OF THE STUDY

Now-a-days companies want to get all sorts of customers. Hence they are coming with
new versions, new models and new technologies. Apart from that companies are more
concentrating on new sales promotion targets like discounts, free gifts, zero finance, free
insurance, free road tax and exchange offers etc. This study is intended to examine the buying
behavior and to examine the pulse of consumer psychology in two wheeler of Bike segment.

LIMITATIONS OF THE STUDY

The study was confined to some selected areas of twin cities.

As the time is major factor the sample size is limited to hundred consumers only.

Some of the consumers are not interested to express their views.

The machines were used by some consumers only.

CHAPTER - 2
HDFC BANK PROFILE

INDUSTRY PROFILE
The bank was set up in 1994 with the goal of creating a world class Indian bank.
HDFC bank follows an interesting strategy. On the lending side, the bank is very conservative.
It only lends to the Triple A and Double A, clients. In contrast, the treasury desk is the most
aggressive in the business and trades actively in debt and foreign exchange.
In spite of having a high prime lending rate of 15.25%, the bank has been able to
attract top clients like Reliance, Godrej and IPCL etc. One of the reasons for this is that HDFC
bank has recruited the best professionals in the business. All of them have excellent contacts
and they have persuaded blue chip companies to shift some of their business to their bank.
The bank is also aggressively increasing its deposit base by opening branches. This has
reduced the bank's dependence on wholesale deposits, which are costlier and more volatile.
Certificates of Deposits (CDs) have reduced from 28% of total deposits to 2.8%.
Moreover, the bank has an equity tie-up with a foreign commercial bank, National
'Westminster (Nat West) of the UK and some capital has also come from overseas corporate
bodies with a presence in Singapore and the Gulf. This bas not only helped the bank in
building a network share technology but has also helped it to attract NRI funds and Lower its
cost of funds. Another way the bank has used to reduce its cost for funds is by building a franchise of products which will give it float money. The bank has also been appointed as a
clearing bank by the National Securities Clearing Corp. for cash settlements on the NSE. This
activity provides the bank with money at zero interest rate for a short period of time.

Similarly, the corporate finance department has introduced a product called, cash
management, for its clients-it makes statutory payments like customs and excise duties on
their behalf. The bank gets a substantial amount of float money because of the difference
between the pay-in and pay-out days.

SOME OF HDFCS FUTURE PLANS INCLUDE:

To introduce phone banking.
To widen the scope of cash management service.
To provide equity advice to high net worth individuals.
To offer loans against shares.
To float a money market mutual fund.

DIMENSIONS OF COMPETITION:
To be successful in the competitive Indian market the banks have to compete on the
following dimensions.

NUMBER OF BRANCHS :
This is a major driving factor in deciding whether a bank should go for high
volume or for low volume of deposits. It also decides the banks capability to mobilize
deposits at cheaper rates.

 QUALITY OF CUSTOMER SERVICE :

10

Service differentiation is an important factor which decides a customer's choice

of bank. It also helps in distinguishing between the various players.

RANGE OF PRODUCTS AND SERVICES OFFERED :

In addition to the usual portfolio of products a bank will have to innovate and
take the lead in offering more value-added service and products like ATMs, Credit
cards etc. so that it can maximize its business per client by being a one-stop shop.

SIZE OF THE FUND BASE :

This again determines what the customer profile for a bank should be which is
an important factor influencing the strategy for a bank. This factor also decides the
bargaining power of banks with its loan clients.

TECHNOLOGY :
A bank needs to have the latest networking technology and information systems
which will result in quicker service levels. Helping to maintain internal control and
reduce manpower costs.
NICHE MARKETING VERSUS MASS MARKETING :
To compete successfully a bank will have to decide whether it wants to concentrate on
getting blue chip clients thus catering to only a particular market segment or to expand its
branches and get the masses. To an extent, this is determined by the variety of products and
services offered by bank.

 OVERALL SKILL LEVEL OF PERSONNEL :

The type of people, employed by bank, .their attitudes, skills and motivation levels can
make a lot of difference to the 11
performance of the bank. Professionals with sound
knowledge of banking and marketing and with a flair for innovation can provide a bank's
competitive edge to the bank. Productivity levels for banks should be high and
continuously improve for it to survive.

FUTURE BANKING:

In the future the following changes are likely to happen to the banking industry.
NBFCs becoming prominent The last decade saw the financial services industry finally take
off. The regulatory structure witnessed quite a shake-up and the conditions were conducive for
the financial services" sector to find a lucrative foothold in India's capital markets. The
principal advantage which NBFCs have is the lesser degree of regulation that they are
subjected to. Also, given the relatively recent origin of these entities they do not have any
excess baggage to carry with them and so start with clean balance sheets. The banks on the
other hand have a larger capital base due to Government rules and this leads to a larger capital
cost. Priority sector Lending is another burden of the banking sector not required to be borne
by the other players in the financial services industry.

SHIFT TOWARDS FEE-BASED BUSINESS:

12
The banking industry is witnessing a sea change in its basic structure with a distinct shift
in the nature of its income. The share of fee-based income has seen a rapid rise in the recent
past the rise of fee-based income in the banking sector's revenue can be attributed to the
following reasons:
The last decade has witnessed a deregulation of the financial services sector and
consequently a sharp rise if the proliferation of non- banking financial entities in the
country. This is one of the prominent reasons behind the squeeze in interest rate
margins resulting in the banks being forced to look for alternative avenues for profits.
The service requirement of the customer has also undergone quite a change. This is a
reflection of the growing & consumerist attitude of the customers. The awareness level
of the customer has increased due to exposure to the quality of service offered by the
financial industry. The customer is willing to pay a premium for these high quality and
reliable services.

The share of non-interest income is 10% of the total income for Indian banks compared
to 49% in Switzerland, 38% in USA, 41 % in UK and 36.5% in Germany. The Indian banking
industry is bound to follow in the footsteps of its foreign counterparts in the shift towards feebased activities, given the rapid globalizations that are taking place.

13

The Indian Capital Markets offer tremendous scope for fee-based activities like
custodial services, electronic transfer, Money market Mutual Funds, portfolio advisory service
etc.
Another area which the banks can look to enter is bank funds which are quite popular
in the US. These are essentially mutual funds run by banks and have a lot in common with a
traditional bank account. Custodial Services would require extremely sophisticated systems,
backup support and a good organizational set up.

FORMATION OF LARGER BANKS:

The banking industry is getting polarized between the large players and the small
players with the smaller players establishing themselves in lucrative niches. Big banks across
the globe are merging with each other and forming huge entities.

UNIVERSAL BANKING:
The boundaries between commercial banks and DFIs are gradually diminishing. In a
few years time, we might have just one financial services industry with the current distinctions
between banks and other financial services areas being no longer relevant.

OTHER BOOMING AREAS:

Venture Capital, Housing finance, Consumer durables finance and Credit cards are areas with
huge potential and demand in these areas is expected to rise exponentially in the future.

14

COMPANY PROFILE

HDFC BANK HYDERABAD:

HYDERABAD: HDFC Bank in association with RBI has made arrangements to issue
Rs.1 and Rs.2 denomination of fresh coins to the general public and customers in exchange of
notes at its branches.
Customers can avail themselves of the facility between 10 a.m. and 12 noon at HDFC
Bank branches at Lakdikapul, Chandanagar and Sainikpuri on April 22 and between 10 a.m.
and 2 p.m. at Dilsukhnagar, Charminar and Kukatpally on April 24.
At RTC crossroads, Himayathnagar and Raj Bhavan road on April 25 and at Begum
pet branch on 26th April.
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 the 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.

15

NEW BRANCH:
HOUSING Development Finance Corporation Ltd (HDFC) has opened its new branch
in Hyderabad, taking its national network to 108 branches, reaching out to over 2,400 towns
and cities across the country.
The HDFC Chairman, Mr. Deepak Parikh, inaugurated the new branch at Dilsukhnagar
here, the fifth in Andhra Pradesh, on Saturday.
Speaking to newspersons, Mr. Parikh said the corporation consistently attempted to
provide top-notch services to its customers through extensive network of offices inter-linked
nationwide. As a part of its objective of enhancing the total residential housing stock, HDFC
also introduced various innovative value-added products to enhance both its range and quality
of service.
HDFC is India's premier housing finance company and enjoys an impeccable track
record in India as well as in international markets. Since its inception in 1977, the Corporation
has maintained a consistent and healthy growth in its operations to remain the market leader in
mortgages. Its outstanding loan portfolio covers well over a million dwelling units.
HDFC has developed significant expertise in retail mortgage loans to different market
segments and also has a large corporate client base for its housing related credit facilities.
With its experience in the financial markets, a strong market reputation, large shareholder base
and unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian
environment.

16

BUSINESS 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.
CAPITAL STRUCTURE:
The authorized capital of HDFC Bank is Rs550 crore (Rs5.5 billion). The paid-up capital
is Rs424.6 crore (Rs.4.2 billion). The HDFC Group holds 19.4% of the banks equity and
about 17.6% of the equity is held by the ADS Depository (in respect of the banks American
Depository Shares (ADS) Issue). Roughly 28% of the equity is held by Foreign Institutional
Investors (FIIs) and the bank has about 570,000 shareholders. The shares are listed on the
Stock Exchange, Mumbai and the National Stock Exchange. The banks American Depository
Shares are listed on the New York Stock Exchange (NYSE) under the symbol HDB.
CBOP TIMES BANK AMALGAMATION:
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.

17

The merged entity will have a strong deposit base of around Rs. 1, 22,000 crore and net
advances of around Rs. 89,000 crore. The balance sheet size of the combined entity would be
over Rs. 1, 63,000 crore. The amalgamation added significant value to HDFC Bank in terms of
increased branch network, geographic reach, and customer base, and a bigger pool of skilled
manpower.
In a milestone transaction in the Indian banking industry, Times Bank Limited (another
new private sector bank promoted by Bennett, Coleman & Co. / Times Group) was merged
with HDFC Bank Ltd., effective February 26, 2000. This was the first merger of two private
banks in the New Generation Private Sector Banks. As per the scheme of amalgamation
approved by the shareholders of both banks and the Reserve Bank of India, shareholders of
Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times Bank.
DISTRIBUTION NETWORK:
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network
of over 1412 branches spread over 528 cities across India. All branches are linked on an online
real-time basis. Customers in over 120 locations are also serviced through Telephone Banking.
The Bank's expansion plans take into account the need to have a presence in all major
industrial and commercial centers where its corporate customers are located as well as the
need to build a strong retail
Customer base for both deposits and loan products. Being a clearing/settlement bank to
various leading stock exchanges, the Bank has branches in the centers where the NSE/BSE has
a strong and active member base.

18

The Bank also has a network of about over 2890 networked ATMs across these cities.
Moreover, HDFC Bank's ATM network can be accessed by all domestic and international
Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American Express Credit/Charge
cardholders.

MANAGEMENT:
Mr. Jagdish Capoor took over as the bank's Chairman in July 2001. Prior to this Mr.
Capoor was a Deputy Governor of the Reserve Bank of India.

The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25
years and before joining HDFC Bank in 1994 was heading Citibank's operation in Malaysia.

The Bank's Board of Directors is composed of eminent individuals with a wealth of

experience in public policy, administration, industry and commercial banking. Senior
executives representing HDFC are also on the Board. Senior banking professionals with
substantial experience in India and abroad head various businesses and functions and report to
the Managing Director. Given the professional expertise of the management team and the
overall focus on recruiting and retaining the best talent in the industry, the bank believes that
its people are a significant competitive strength.

19

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).
The Bank has made substantial efforts and investments in acquiring the best
technology available internationally, to build the infrastructure for a world class bank. The
Bank's business is supported by scalable and robust systems which ensure that our clients
always get the finest services we offer.
The Bank has prioritized its engagement in technology and the internet as one of its
key goals and has already made significant progress in web-enabling its core businesses. In
each of its businesses, the Bank has succeeded in leveraging its market position, expertise and
technology to create a competitive advantage and build market share.
BUSINESS:
HDFC Bank offers a wide range of commercial and transactional banking services
and treasury products to wholesale and retail customers. The bank has three key business
segments:

20

WHOLESALE BANKING SERVICES:

The Bank's target market ranges from large blue-chip manufacturing companies in the
Indian corporate to small & mid-sized corporate and agri-based businesses. For these
customers, the Bank provides a wide range of commercial and transactional banking services,
including working capital finance, trade services, transactional services, cash management,
etc. The bank is also a leading provider of structured solutions, which combine cash
management services with vendor and distributor finance for facilitating superior supply chain
management for its corporate customers.
Based on its superior product delivery / service levels and strong customer orientation,
the Bank has made significant inroads into the banking consortia of a number of 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.
The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank
Plus and the Investment Advisory Services programs have been designed keeping in mind
needs of customers who seek distinct financial solutions, information and advice on various
investment avenues. The Bank also has a wide array of retail loan products including Auto
Loans, Loans against marketable securities, Personal Loans and Loans for Two-wheelers. It is
also a leading provider of Depository Participant (DP) services for retail customers, providing
customers the facility to hold their investments in electronic form.

21

HDFC Bank was the first bank in India to launch an International Debit Card in
association with VISA (VISA Electron) and issues the MasterCard Maestro debit card as well.
The Bank launched its credit card business in late 2001. By March 2008, the bank had a total
card base (debit and credit cards) of 9.1 million. The Bank is also one of the leading players in
the merchant acquiring business with over 61,000 Point-of-sale (POS) terminals for debit /
credit cards acceptance at merchant establishments. The Bank is well positioned as a leader in
various net based B2C opportunities including a wide range of internet banking services for
Fixed Deposits, Loans, Bill Payments, etc.
TREASURY:
Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the
liberalization of the financial markets in India, 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.

22

RATINGS:
CREDIT RATING:
The Bank has its deposit programs rated by two rating agencies - Credit Analysis &
Research Limited (CARE) and Fitch Ratings India Private Limited. The Bank's Fixed Deposit
program has been rated 'CARE AAA (FD)' [Triple A] by CARE, which represents instruments
considered to be "of the best quality, carrying negligible investment risk". CARE has also
rated the bank's Certificate of Deposit (CD) program "PR 1+" which represents "superior
capacity for repayment of short term promissory obligations". Fitch Ratings India Pvt. Ltd.
(100% subsidiary of Fitch Inc.) has assigned the "TAAA (ind)" rating to the Bank's deposit
programme, with the outlook on the rating as "stable". This rating indicates "highest credit
quality" where "protection factors are very high "The Bank also has its long term unsecured,
subordinated (Tier II) Bonds rated by CARE and Fitch Ratings India Private Limited and its
Tier I perpetual Bonds and Upper Tier II Bonds rated by CARE and CRISIL Ltd. CARE has
assigned the rating of "CARE AAA" for the subordinated Tier II Bonds while Fitch Ratings
India Pvt. Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable".
CARE has also assigned "CARE AAA [Triple A]" for the Banks Perpetual bond and Upper
Tier II bond issues.
CRISIL has assigned the rating "AAA / Stable" for the Bank's Perpetual Debt
programmed and Upper Tier II Bond issue. In each of the cases referred to above, the ratings
awarded were the highest assigned by the rating agency for those instruments.

23

CORPORATE GOVERNANCE RATING:

The bank was one of the first four companies, which subjected itself to a Corporate
Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating
Information Services of India Limited (CRISIL). The rating provides an independent
assessment of an entity's current performance and an expectation on its "balanced value
creation and corporate governance practices" in future. The bank has been assigned a 'CRISIL
GVC Level 1' rating which indicates that the bank's capability with respect to wealth creation
for all its stakeholders while adopting sound corporate governance practices is the highest.
Incorporated in August 1994 as HDFC Bank Limited, the bank now has a wide
network of over 531 branches across 228 cities in India, and over a thousand networked
ATM's.
HDFC is India's premier housing finance company and enjoys an impeccable track
record in India as well as in international markets. Since its inception in 1977, the Corporation
has maintained a consistent and healthy growth in its operations to remain the market leader in
mortgages. Its outstanding loan portfolio covers well over a million dwelling units. HDFC has
developed significant expertise in retail mortgage loans to different market segments and also
has a large corporate client base for its housing related credit facilities. With its experience in
the financial markets, a strong market reputation, large shareholder base and unique consumer
franchise, HDFC was ideally positioned to promote a bank in the Indian environment.

24

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.
The authorized capital of HDFC Bank is Rs.450 crore (Rs.4.5 billion). The paid-up
capital is Rs.311.9 crore (Rs.3.1 billion). The HDFC Group holds 22.1% of the bank's equity
and about 19.4% of the equity is held by the ADS Depository (in respect of the bank's
American Depository Shares (ADS) Issue). Roughly 31.3% of the equity is held by Foreign
Institutional Investors (FIIs) and the bank has about 190,000 shareholders. The shares are
listed on the Stock Exchange, Mumbai and the National Stock Exchange. The bank's
American Depository Shares are listed on the New York Stock Exchange (NYSE) under the
symbol "HDB".
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. 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. The acquisition added
significant value to HDFC Bank in terms of increased branch network, expanded geographic
reach, enhanced customer base, skilled manpower and the opportunity to cross-sell and
leverage alternative delivery channels.

25

AWARDS:
Our single-minded focus on product quality and service excellence has helped us
garner the appreciation of both national and international organizations.
AWARDS AND ACHIEVEMENTS-BANKING SERVICES:
HDFC Bank began operations in 1995 with a simple mission: to be a "World-class
Indian Bank". We realized that only a single-minded focus on product quality and service
excellence would help us get there. Today, we are proud to say that we are well on our way
towards that goal.
It is extremely gratifying that our efforts towards providing customer convenience have
been appreciated both nationally and internationally.
ASIA MONEY ALSO NAMED THE BANK:

Best Local Cash Management Bank in India 2004 - US$11-100m

Best Local Cash Management Bank in India 2004 - >US$501m

Best Local Cash Management Bank in India 1989-2004 (poll of polls)

Best Overall Domestic Trade Finance Services in India 2004

Most Improved Company for Best Management Practices in India 2004

26

The Business Today-KPMG Survey published in the leading Indian business magazine
Business Today has named HDFC Bank "Best Bank in India" for the third consecutive year
in 2005.
The Asset magazine named HDFC Bank "Best Cash Management Bank" and "Best
Trade Finance Bank" in India, in 2006.
HDFC Bank named the "Most Customer Responsive Company - Banking and
Financial Services in The Economic Times - Avaya Global Connect Customer Responsiveness
Awards 2005"
HDFC Bank has been named Best Domestic Bank in India in The Asset Triple a
Country Awards 2005.
HDFC Bank has been named Best Domestic Bank in India Region in The Asset Triple
A Country Awards 2004 and 2003.
In 2004, HDFC Bank was selected by Business World as "One of India's Most
Respected Companies" as part of The Business World Most Respected Company Awards
2004.
In 2004, Forbes Global again named us in its listing of Best Under a Billion, 100 Best
Smaller Size Enterprises in Asia/Pacific and Europe, in its November 1, 2004 issue.
In 2004, HDFC Bank won the award for "Operational Excellence in Retail Financial
Services" - India as part of the Asian Banker Awards 2003.
In 2003, Forbes Global named us in its ranking of "Best under a Billion, 200 Best Small
Companies for 2003".
Leading business newspaper The Financial Express named HDFC Bank the "Best
27
New Private Sector Bank 2003" in the FE-Ernst & Young Best Banks Survey 2003.

Leading Personal Finance Magazine in India Outlook Money named HDFC Bank the
"Best Bank in the Private Sector" for the year 2003.
Leading Indian business magazine Business Today in a survey rated us "Best Bank in
India" 2003, and "Best Private Sector Bank" in India in 1999.
NASSCOM and economictimes.com have named us the 'Best IT User in Banking' at
the IT Users Awards 2003.
THERE HAS BEEN SOME OTHER PROUD MOMENTS AS WELL:
London-based Euro money magazine gave us the award for "Best Bank - India" in
1999, "Best Domestic Bank" in India in 2000, and "Best Bank in India" in 2001 and 2002
Asia money magazine has named us "Best Commercial Bank in India 2002".
For our use of information technology we have been recognized as a "Computerworld Honors
Laureate" and awarded the 21st Century Achievement Award in 2002 for Finance, Insurance
& Real Estate category by Computerworld, Inc., USA.
Our technology initiative has been included as a case study in their online global
archives. The Economic Times has conferred on us The Economic Times Awards for
Corporate Excellence as the Emerging Company of the Year 2000-01.
Leading Indian business magazine Business India named us "India's Best Bank" in
2000.
In the year 2000, leading financial magazine Forbes Global named us in its list of "The
300 Best Small Companies" in the world and as one of the "20 for 2001" best small companies
in the world.
28

We are aware that all these awards are mere milestones in the continuing, never-ending
journey of providing excellent service to our customers. We are confident, however, that with
your feedback and support, we will be able to maintain and improve our services.

BEST CORPORATE SOCIAL RESPONSIBILITY PRACTICE

HDFC Bank wins the 'Best Corporate Social Responsibility Practice' award at 'The
'Business for Social Responsibility Awards 2007.
Our bank has won the 'Best Corporate Social Responsibility Practice' award at 'The
Business for Social Responsibility Awards 2007' function held on Friday, January 18, 2008,
presented by the Bombay Stock Exchange and Nasscom Foundation. Our country Head-HR,
Mandeep Maitra, received the award on behalf of our bank from Mr. Ketan Sheth, Chairman
and MD of IT People at a function held in Mumbai.
The 'Business for Social Responsibility Awards 2007' recognizes best practices in
business for social responsibility and is judged by an independent jury comprising leaders in
Corporate HR, Corporate Communications and Marketing as also NGO representatives. Our
bank won in the category 'Best Corporate Social Responsibility Practice'. Other categories
being, 'Organization that Offers the Best Return to Investors,' 'Organization that Offers the
Best Return to Consumers' and 'Organization that Offers the Best Return to Channel Partners /
Ancillary Development.'

29

There were over 200 entries in the four categories. Twenty-six corporate houses were
short-listed in the CSR category. Other winners in this category are Dr. Reddy's Laboratories,
Designate, Mahindra & Mahindra, SKS Microfinance, Yes bank and Financial Technologies.

DUN & BRADSTREET - AMERICAN EXPRESS CORPORATE

BEST BANK AWARD 2007

Our bank has won the 'Dun & Bradstreet -American Express Corporate Best Bank
Award 2007'

There were 26 categories in all including FMCG, Telecom and Software & IT, where
Unilever India, Bharti Airtel and Infosys Technologies Ltd. won respectively.

The 'Dun & Bradstreet - American Express Corporate Awards 2007' recognize the twin
virtues of size and growth in the organizations of corporate India. The eight parameters
considered in ranking companies for awards were Total Income, Net Profit, Net Worth,
Net Profit Margin, Return on Net Worth, Average Market Capitalization for Financial
Year 2007/ 08, Growth in Total Income and Growth in Net Profit.

Our Executive Director, Paresh Sukthankar received the award on behalf of the bank at
a glittering awards ceremony in Mumbai on Friday, February 1, 2008.

30

AWARDS FOR 2007 AND 2008

2008
Forbes Asia

Fab 50 companies in Asia Pacific

Asian Banker Excellence in

Retail Financial Services

Best Retail Bank 2008

Asia money

Best local Cash Management Bank Award voted by

Corporate

Microsoft & Indian Express

Group

Security Strategist Award 2008

World Trade Center Award of

honour

For outstanding contribution to international trade

services.

Business Today-Monitor Group One of India's "Most Innovative Companies"

survey

2007:

Financial Express-Ernst &

Young Award

Best Bank Award in the Private Sector category

Global HR Excellence Awards

- Asia Pacific HRM Congress:

'Employer Brand of the Year 2007 -2008' Award First Runner up, & many more

Business Today

'Best Bank' Award

Dun & Bradstreet American

Express Corporate Best Bank
Award 2007
The Bombay Stock Exchange
and Nasscom Foundation's
Business for Social
Responsibility Awards 2007
Outlook Money & NDTV
Profit
The Asian Banker Excellence
in Retail Financial Services
Awards
Asian Banker

'Corporate Best Bank' Award

'Best Corporate Social Responsibility Practice'
Award
Best Bank Award in the Private sector category.
Best Retail Bank in India
Our Managing Director Aditya Puri wins the
Leadership Achievement Award for India

AWARDS FOR 2004 AND 2003:

Business Today

"Best Bank in India"

Hong Kong-based Finance Asia magazine "Best Overall Local / Domestic Bank
India
Business Today
Corporate

"Best Bank in India"

Cash

Management

Poll Best Overall Local/Domestic Bank India

conducted by the Hong Kong based Asia

money magazine
Business World

"One

of

India's

Most

Respected

Companies as part of The Business World

Most Respected Company Awards 2004.
Forbes Global

Best Under a Billion 100 Best Smaller Size

Enterprises in Asia / Pacific and Europe, in
its November 1, 2004 issue.

Asian Banker Awards 2003.

Operational Excellence in Retail Financial

Services

The Asset Triple A Country Awards

Best Domestic Bank

Asia money magazine

Managing Director, Mr. Aditya Puri as the

"Best Chief Executive Officer in India

Asian

Banker

Excellence

in

Financial Services Program 2003

AWARDS FOR 2002 AND 2001:

Retail Operational Excellence in Retail Financial

Services India

2002:

Hong

Kong-based

Finance Best Local Bank India

Asia magazine
Euro money magazine

"Best Bank in India

Asia money magazine

Commercial Bank in India 2002

AWARDS FOR THE YEAR 2001:

Hong Kong-based Finance Best Domestic Commercial Bank India
Asia magazine
Euro money magazine

Best Domestic Bank

Business India

" India 's Best Bank"

Forbes Global

Named in The 300 Best Small Companies one of the "20 for
2001" best FE-E&Y Best Banks small companies

CREDIT RATINGS:
33
HDFC Bank has its deposit program rated by two rating agencies - Credit Analysis &
Research Limited. CARE and Fitch Ratings India Private Limited. The bank's Fixed Deposit
program has been rated 'CARE AAA (FD)' [Triple A] by CARE, which represents instruments
considered to be "of the best quality, carrying negligible investment risk".

CARE has also rated the bank's Certificate of Deposit (CD) program "PR 1+" which
represents "superior capacity for repayment of short term promissory obligations". Fitch
Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.) has assigned the "TAAA (ind)" rating
to the bank's deposit program, with the outlook on the rating as "stable". This rating indicates
"highest credit quality" where "protection factors are very high".
HDFC Bank also has its long term unsecured, subordinated (Tier II) Bonds of Rs.4
billion rated by CARE and Fitch Ratings India Private Limited. CARE has assigned the rating
of "CARE AAA" for the Tier II Bonds while Fitch Ratings India Pvt. Ltd. has assigned the
rating.
"AAA (ind)" with the outlook on the rating as "stable". In each of the cases referred to
above, the ratings awarded were the highest assigned by the rating agency for those
instruments.

CAREERS:
Why should you select HDFC Bank?
Possibly because it is India's leading private34sector bank.
Or it could be because HDFC Bank was rated so highly by leading national and
international magazines such as Business India, Business Today, Euro money, Finance Asia
and Forbes Global, to name a few.

It could also be because you see the wide range of opportunities that we offer in
Branch Banking, Retail Assets, Product Development, Operations, Marketing, Treasury,
Equities, Corporate Banking, Cash Management Services, Custody and Depositories etc.

TO MAKE YOUR DECISION EASIER, HERE ARE A FEW MORE

REASONS.
HDFC Bank is a young and dynamic bank, with a dedicated team determined to
accomplish the bank's mission of becoming a world-class Indian bank as early as possible.
The Bank's strategic framework has provided us with four core values - customer
focus, operational excellence, product leadership and people.
Finally, we believe that ultimately, the success of our bank resides in the exceptional
quality of our people and their extraordinary efforts. For this reason, we are committed to
hiring, developing, motivating and retaining the best people in our industry
.

BANKING INDUSTRY- A PROFILE:

INTRODUCTION:
The Indian financial sector today comprises an impressive network of financial
institutions and a wide range of financial instruments. Out of this provision of short term
35 and co operative banks. Beside performing
credit is entrusted primarily to commercial
these functions, commercial banks have of late diversified into several new areas of
business such as merchant banking , mutual funds, leasing ,venture capital , factoring and
other financial services. To support these, there is a wide network of co operative banks and

co operative land development bank at state, district and sub district levels. Together,
commercial and co operative banks hold around two thirds of the total assets of the Indian
financial system, the structure of which is shown below.
FORMATION OF RBI:
The Banking Inquiry Committee completed its exhaustive survey of Indian banking
conditions in 1930. The principal recommendations of this committee may be summarized as
follows:
I. Establishment of the Reserve Bank
II. Removal of restrictions of the foreign exchange business of the Imperial bank.
III. Formation of All India Bankers Association
IV. Promulgation of the Special Bank Act
V. Amendment of the Indian Companies Act.

The Reserve Bank Bill was introduced new banks in the Legislative Assembly in
September, 1933. In April 1935, the bank began to function, bringing to a close the period of
uncoordinated banking in India. The general superintendence and direction of the Reserve
36
Bank is entrusted to a Central Board of Directors of 20 members, consisting of the Governor
and 4 Deputy Governors, 1 Government official from the Ministry of, Finance, 10 Directors
nominated by the Central Government to represent the 4 local boards at Bombay, New Delhi,
Madras and Calcutta.

These local boards in turn, consist of 5 members each, appointed by the Central
(Government for a term of 4 years to represent territorial and economic interests as well as the
interests of co-operative and indigenous banks.
As the supreme banking authority in the country, the RBI had the following powers:
It held the cash reserves of all the scheduled banks.
It controlled the credit operations of banks through qualitative and quantitative
controls.
It controlled the banking system through the system of licensing, inspection and calling
for information.
It acted as the lender of last resort by providing rediscount facilities to scheduled
banks.
During the decade that followed, several attempts were made to pass a banking legislation.
But, it was only in 1949 that the Banking Companies Bill was passed. With the coming of the
Banking Companies Act into force on March 10, 1949 the country was equipped with a very
modem and a very comprehensive banking legislation.
ROLE OF THE RBI:

Over the years, the RBI has established a system of regulating banks within the overall
37
macroeconomics and developmental objectives laid] down by the Government in the five year
plans.

The policy goals of regulating banks in India can be summarized as follows;

MONETARY STABILITY:
The statutory basis for the regulation of the credit system by the RBI is laid down in
the RBI Act and the Banking Regulation Act. The former confers on the RBI the usual powers
available to Central banks:
Bank rate.
Open market operations
Variable reserve requirements.
The latter provides special powers of direct regulation of bank operations. The
objective of pursuing this policy goal is that the rate of increase in money supply is kept at a
judicious level above the projected rate of growth of real national income, thus acting as a
check on - inflation.
SOCIAL AND ECONOMIC DEVELOPMENT:
With the help of nationalization, the Government is expected to satisfy the legitimate
needs of the hitherto neglected sectors of the economy. Since then, the RBI's regulatory
machinery has been fine-tuned to ensure that banks comply with the allocative and
quantitative goals set from time to time.
PRUDENTIAL FUNCTIONING OF BANKS:
Prudential regulation helps prevent, limit or stop the damage caused by inefficient or
38 have been specified by the Banking Regulation
dishonest management. The following areas
Act as the elements of a prudential, regulatory framework for banks:
Capital adequacy
Liquidity

 Appointment of Directors and Chainman

Control over management
Branch network
Treatment of problem and failed banks
Audit program
Loans to insiders and other connected parties
Acquisition of the bank, in the public interest, by the Central Government
SUPERVISORY FUNCTIONS OF THE RBI:
In addition to its traditional central banking functions, the RBI has certain nonmonetary functions in the nature of supervision of banks and promotion of sound banking in
India. The Reserve Bank of India Act, 1934 and the Banking Regulation Act, 1949, have given
the RBI wide powers .of supervision over commercial and co-operative banks, relating to the
following aspects:
Licensing and establishments.
Branch expansion.
Asset liquidity.
Management and methods of working.
Amalgamation, reconstruction and liquidation.
In addition, the RBI is authorized to39carry out periodical inspection of banks and to call
for returns and necessary information from them. The nationalization of 14 major Indian banks
in 1969 has imposed new responsibilities on the RBI for directing the growth of banking and

credit policies towards more rapid development of the economy and realization of desired
social objectives.
The supervisory functions of the RBI have helped a great deal in improving the
standard of banking in India to develop on sound lines and to improve the methods of
operation.
THE FEATURES OF THE BANKING INDUSTRY:

The banking sector in India has high growth potential and is expected to grow at
around 20-30% in contrast to the stagnant developed economies. Deregulation is also taking
place and the sector is being bought at par with international norms and standards. With the
backing of their strong parent banks abroad, many foreign banks are finding it very attractive
to set up operations in India.
Private players have also been allowed to set up banks in India under the new policy
guidelines in the deregulated environment. This is going to increase the number of players in
the market further, and the competition is going to intensify for attracting customers.
As per RBI norms, any bank has to have a minimum required equity base of Rs. 100
crores. This has been done so as to restrict the entry of small players who might have entered
the market just to make a quick profit. At the same time, for other private players who have
got the backing of big institutions behind them.40this is not really an entry barrier as the strong
parent can easily support this equity base. Moreover, private banks have recently been
exempted from the SEBI guidelines relating to the public issue of equity. This implies that the

new players can go to the capital market to raise the required equity to meet the statutory
minimum equity base.
Any new player would also be wary of the vast branch network of the existing
monolith nationalized banks. To reduce its cost of funds and thus improve profitability, any
bank has to have a large percentage of its deposits as retail deposits, which can only be
possible if the bank has a large number of branches. This disadvantage of poor distribution
network can be overcome to an extent by superior technology, skills and systems which these

forex services for both business and non-business needs. The Bank undertakes
Collection Negotiation discount of Export Bills. It offers to advise on Export Letters of
Credit and also add confirmation thereof. It arranges for External Commercial
Borrowings and offers all types of credit facilities to exporters and importers. Including
would start with. Since depositor switching costs are- negligible, by their better service levels,
these banks can attract customers from the nationalized banks. These banks will also be
starting with clean balance sheets and with no Naps which will make it easier for them to
access .funds at cheaper rates than the existing players.
The banking industry broadly serves two types of customers: corporates and
individuals. Both of these have their own motivations to park their funds at the banks. With
competition emerging for these funds the banks have to fights hard to retain their ground.
41
CORPORATE BANKING:
Corporate essentially go to banks for meeting their working capital needs. But if they
could get access to cheaper funds from other sources they would not hesitate from going to

them. With the availability of financial instruments like commercial paper and fixed deposits
and with the development of capital markets, corporate are getting access to other easy sources
of funds.
At the same time it must be kept in mind that only blue chip corporate are able to raise
funds by these instruments.

For other activities of corporate like cash management forex services, opening letters
of credit etc, it is still the banks which are holding a dominant position, essentially because of
the operational efficiency with which they are able to provide these services. This is also
substantiated by the fact that in recent times, more and more of the income of banks is coming
from fee-based activities rather than from interest income.
RETAIL BANKING:
The main reason behind customers making deposits in the banks is the liquidity and
safety that is offered to the individual. The customer can go to the bank anytime and get the
money withdrawn. Therefore, the banks charge liquidity premium and thus offer lesser returns
in comparison to the other financial instruments which cannot be enchased on tap. But now
with the availability of a wide variety of financial instruments a customer can choose the level
of liquidity he desires and thus get a higher return.
42
Securities like debentures - on tap, debentures on shelf , MMMFs and other open
ended mutual fund schemes provide the easy liquidity and also benefits of high yield
securities .

The suppliers of the sources of funds for the banks are the clients of banks who
deposit money with them . It is difficult task for a bank to attract these deposits, as clients can
always keep their money with other banks if they think that service levels of other banks are
better.
Switching costs for a savings bank account are virtually negligible. However in savings
accounts the product offered is standard and also governed by regulations, thus making it more
or less. Thus, in the case of bank deposits, the guiding factors are the service level and the
accessibility of the customer to the branch.
In case of time deposits, banks have stiff competition from companies offering fixed
deposits and from Non-Banking Finance Companies (NBFCs) which offer higher rates of
return. Therefore banks cannot keep their time deposits way below the deposit rates offered by
NBFCs. At the same time banks are much safer than NBFCs as banks offer deposit insurance
and the regulations governing banks are much more stringent than those covering the NBFCs.

PLAYERS IN THE MARKET:

The players have been classified on the basis of three main constituents as is evident
from the industry structure, viz. the Public Sector banks, the Foreign Banks and the Private
Sector banks.

43

PUBLIC SECTOR BANKS:

The Public Sector Banks have dominated the Indian banking scene for over three
decades since the nationalization of banks in 1969. The major players are State Bank of India,

Canara Bank and Corporation Bank. Public sector banks are those banks in which the
Government has a major stake.

STATE BANK OF INDIA:

The mission statement of SBI is "To become the largest bank in the Asian banking
scene, outside Japan.
The State Bank of India is the largest bank in India. Established in 1921, SBI was
formed by the amalgamation of the Presidency Banks of Mumbai, Bengal and Madras and
later reconstituted under the SBI Act of 1955. In 1959, the State Banks of Bikaner & Jaipur,
Hyderabad, Indore, Mysore, Patiala, Saurashtra and Travancore joined the SBI as subsidiaries.
In 1996, it had 8835 branches, and employed 2.32 lakhs people. Its net profit for the same year
stood at Rs. 1329.30 crores (RONW = 16.66%). SBI's gross NPAs touched 17% in 1996-97,
while the capital adequacy ratio was 12.17%.

SBI also has the largest number of overseas branches, numbering 48 in 34 countries.
At present, 750 branches, accounting for 35% of total business and profits are completely
computerized. Over the next two years, about 2200 branches, covering 75% of total business
are expected to be computerized.
SBI was set up with the objectives of social commitment to promoting agriculture
small industry and providing easy access to small investors and for taking banking to the
masses by spreading its branching network44to all parts of the country. This objective clearly
lacks a profit focus which any commercial

CORPORATION BANK:

Corporation Bank was founded in 1906 by a group of philanthropists in the temple

town of Udupi and Dakshina Kannada District which is hailed as the cradle of banking. The
bank was nationalized in 1980 and since then has emerged as an innovative and dynamic bank.
In October 1997, the bank came out with an Initial Public Offer of 38 million Equity Shares of
Rs.lO/- each at a premium of Rs.70/- and it was a stunning success with a whopping 10.8
times over subscription.
The Corporation Bank has a 3-tier set up, consisting of a Corporate Office, 18 Regional
Offices and 631 outfits (582 Branches and 49 Extension Counters) as on date, spread over 17
States and 2 Union Territories, with a total workforce of over 9,600.
The bank has also done well in information technology implementation having fully
computerized 36% of the bank's total branches, covering about 75% of the Bank's aggregate
business. The bank offers a .wide range of products and services, both for the individual as
well as the corporate customer. These are highlighted below:

DEPOSIT SERVICES:
Corporation Bank has structured a wide range of innovative schemes for its depositors
tailored to their liquidity and return requirements.

LOAN PRODUCTS:

45

Loans for cars, education, consumer, durables, housing, farm machinery and medical
equipment are easily available. Corporate are also given loans for projects and for trade
financing.

CORPORATE SERVICES:
Corporation Bank has also several unique services tailor-made for the requirements of
large corporate and business houses. Apart from the borrowing products, two unique products
have been developed by Corporation Bank for speedy collection and payment across a
network of locations in India. These products help the Corporate to realize their receivables
faster or remit funds to various centers across India.

FOREX SERVICES:
Corporation Bank has a wide range of foreign exchange denominated finance to
resident entities. It offers inward and outward foreign exchange remittance services for travel,
medical and other personal requirements. Finally the bank also issues travelers cheques in
foreign exchange and also deals in foreign currency.

FOREIGN BANKS:
After the liberalization process started, a lot of foreign banks have proliferated in India,
attracted by the large Indian market. The major foreign banks existing in India are Citibank,
Bank of America, Standard Chartered, ANZ Grindlays, American Express Bank, and Hong
46
Kong Bank. These banks have raised the potentially big market in the retail banking sector.

CITI BANK:

Citibank is a subsidiary of Citicorp, one of the largest banks in the world with assets of
more than 4250 billion and record earnings in 1995 of approximately 43.4 billion. The bank
employs over 85,000 people in 96 countries around the world.
Citibank's Indian operations started in 1902 in Calcutta. The entry of Citibank (then
known as International Banking Corporation) was part of the "Asian thrust" with branches
operating in Hong Kong, China, Singapore and Japan. Citibank then opened the second branch
in India, at Bombay, in 1904 and then spread to Delhi (1963) and Madras (1965).
Presently Citibank operates in six branches in the country, but its presence is limited to
the four metros. It is the largest private sector financial institution in the country in terms of
operating profits.

CITIBANK IS STRUCTURED INTO THE FOLLOWING MAIN DIVISIONS

Private Banking is a new unit relying heavily on relationships. This offers a complete
range of financial services and specializes in helping individuals and families. With significant
means to pursue their business and aspirations. Citibank realized that' it could offer the
personal banking products on the strength of relationships' that it is competent at building.
Global Consumer Banking is the globally-integrated retail banking division for
domestic and worldwide financial needs of customers in all the countries of the world.
47
Beginning in 1985 Global Consumer Business has changed the very concept of consumer
banking in India by pioneering several schemes for the individual customer. The services
include transaction products such as checking accounts, cards, saving and investment

products, credit and insurance. Globally, this consumer segment has been a leader in the
development of the, automated cash machine, in the automation of the process shop and credit
card transactions.
Global Finance is the wholesale banking division catering to local and world wide
financial needs of corporate and other FI's in the Emerging Markets. Today Global Finance
clients include established Indian corporate, multinationals, financial institutions, major
Government enterprises and foreign institutional investors (FIls) looking for portfolio
opportunities. The operations of this division include cash/trade services, custodial services,
treasury operations, CPs, etc. Global Relationships Banking is the wholesale banking
division catering to corporate.
Bank of America BofA is the second best performer among US commercial banks,
coming a close second to Citicorp in terms of assets (US$ 200 billion) and net income (US $
2.17 billion). The bank currently has branches in' 37 countries and employs over 1, 00,000
people worldwide. Its important services include retail banking,
Corporate banking, trade finance forex advisory and risk management. The bank has been
constantly improving its performance in terms of deposit growth and net income.
BofA's Indian operations began 30 years ago and the bank currently has branches in
the four metropolitan cities of Bombay, Madras, Calcutta and New Delhi. The Indian
operations have been concentrating largely on
48corporate customers like the top 100 companies
in India and the Non - Resident Indians (NRI) depositors.
However, in late 1994, the bank expanded into retail banking and decided to
aggressively target this segment. In March'96 BofA also applied to the RBI for six licenses to
allow it to expand is services to non-metro towns.

AREAS OF ACTIVITY IN INDIA INCLUDE:

Commercial banking

Letters of Credit, Working capital and term loans.

Cash management

- Treasury workstations, funds transfers.

Treasury management

- Forex and securities trading, derivative products,

Forex advisory.

Consumer banking

Deposits, Car loans, loans against securities.

Corporate finance

Capital market operations, corporate advisory,

Mergers and Acquisitions, business advisory.

PRIVATE BANKS:
In the first phase of financial reforms in 1991, a major recommendation was to
allow the entry of private players in the banking sector. This was done to compete with the
foreign banks on a near equal footing since public sector banks were in bad shape and
burdened with fulfilling social objectives. Many of these private banks were promoted by
financial institutions like IDBI, ICICI, HDFC etc. In a way, the Government policy of
allowing the entry of private players into the banking sector was also because these financial
institutions could then mobilize deposits at a lower cost through the retail sector. Earlier, the
Government used to provide these institutions loans at a subsidized rate, so that they could
49
match their medium and long-term assets. These subsidized loans had stopped and therefore
the Government had to give these institutions some kind of sops as compensation. This they
gave by allowing them to set up private banks.

Private sector entities and banking professionals have also been permitted to set up
their own banks, though getting licenses is still very difficult.
In the early years, the private sector banks raised money through short-term sources of
funding like CDs, etc. which had high interest rates. These were then sold to large institutions
and banks. Recently these banks have started expanding rapidly so that they could tap a major
portion of the retail deposits, which will in turn lower their cost of funds.
Though the regulations and policies for this sector are not very concrete till now, the
players that have entered the scene are UTI, Indusind, ICICI, HDFC and Centurion.

INDUSIND BANK:
The first private sector bank to be opened in the country has made rapid strides since
its inception in April, 1994. Within a short span of just four years, the bank has not only
emerged as the fastest growing new generation private bank, but has also been rated as the best
bank by various surveys.
Indusind, the brainchild of S.P. Hinduja, a leading NRI businessman belonging to the
House of Hindujas, has been set up with the clear aim to be a "model amongst similar new
generation banks, setting its eyes on globalization". The thrust areas of the bank are
50
international banking. Treasury services corporate banking, priority sector banking,
investment banking and retail banking.
Indusind is also one of the most modem hi-tech banks. All operations are fully
computerized with a single window concept and fast turnaround time' resulting in a .high level

of customer satisfaction. All offices of the bank are linked via satellite allowing the customer
instant access to all branches and permitting the bank to offer innovative products like Indus
reach (anywhere banking for individual), Indus connect (for corporate rates to efficiently
manage their cash flows), Indus instant (online electronic transfer of funds), Indus float (one
year deposit with floating interest rates), Indus cal (tele-banking services) and internet
banking.

51

CHAPTER - 4
THEORETICAL
FRAME WORK CUSTOMER SATISFACTION

INTRODUCTION

As the human history speeds towards with its awe-inspiring problems and
opportunities, the subject marketing is attracting increasing attention from companies,
institutions and nations. Marketing has evolved from its origins in distribution and selling into
a comprehensive philosophy for relating any organization dynamically to its market.

Large and small business firms every where beginning to appreciate the deference
between selling and marketing and are organizing to do latter. Non profit organizations such as
museums, universities, churches and government agencies are seeing marketing as a new way
of looking at their relations with their public. Marketing is a comprehensive term. Marketing
includes all resources and a set of activities necessary to direct and facilitate the flow of goods
and services from producer to the consumer. Businessmen regard marketing as a management
function to plan, to promote and to deliver products.

52

CUSTOMER SATISFACTION:

The business now a day mainly depends on the customer. The marketing
concept was born out of the concept that the marketing start with the determination of
customer wants and ends with the satisfaction of those wants. The entire business has to be
seen from the point of view of the customer.
In the words of Philip Kotler The Marketing Concept is customer orientation backed
by integrated marketing aimed at generating customer satisfaction as the key to satisfy
organizational goals. Customer satisfaction implies provisions of quality product, competitive
price, prompt service, efficient management, cost competitiveness and good image etc
Though the main objective of any enterprise is to earn maximum profits, but this
objective can be achieved only if the customers of enterprise are satisfied.
The sounder goal for the marketer is to aim to maximum customer satisfaction. The
marketers task is to track changing consumer wants and influences the company to adjust its
mix of goods and services to those that they are needed. The marketer makes sure that the
company continues to produce value for the target customer markets.
Hence Customer satisfaction is one of the important goal and objective for the
marketing management of any organization. So, the organization has to supply goods
according to the consumer needs and wants. 53
Today's companies are facing their toughest competition ever, due to numerous factors.
But the entire success of the company lies in the amount of belief loyalty its customers are
having in it.

The amount of faith that is vested in the company by its customers determines the way
the company is barrel id determined by its customers. In this digital enhanced world,
marketing has lost its prime scope and new terms started creeping in its contents. And one can
see clearly that a vast majority of these are 'customer focused'.
So customer plays the important role behind the success of a company, no matter what
levels of technology it has and what levels of turnover they can make. Now with the
technology interference, the war between the companies has shifted from the grounds of
products, price, place and the promotion to a single 'p' - person. And that person is the
'customer'. Also gone are the days of creating. It's now 'acquiring' and 'sustains' the customers
plays a major role in deciding the vectors in such wars. The service sector has increased
dramatically in importance over a decade. Deregulation of services, growing competition,
fluctuations in demand, and application of new technologies is presenting a considerable
challenge to service companies.
"After sales service" is considered as one of the important marketing strategies
implemented by the companies to enhance their sales. Service after sale is continuing and
strengthening of the bondage between the dealers and the customers by further satisfying them
54
even after the sale of the product.
"After sales service" is an important aspect of a marketing transaction such service
covers repairs, smooth maintenance, availability of spare parts at lower prices after the product
has been sold out and is used. These services are important because they ensure that there is no
dissatisfaction and frustration among the customers against the products.

Customer service influences customer's perception greatly. It can thus be used as a

weapon to create competitive advantage that is not easily copied. This represents as important
means of creating differentiation in the company's positioning strategy.
Dr.Kotler premises that customer will buy from the firm that they perceive offers the
highest customer delivered value.
Whether the customer is satisfied after purchase or not, depends on the offers
performance in the relation to the buyers expectations.
1. If the performance matches the expectations, the customer is satisfied.
2. If the performance falls short of expectations, the customer is highly dissatisfied.
3. If the performance falls short of expectations, the customer is highly dissatisfied or
delighted.
High satisfaction or delight creates an emotional bond with the brand, not just a
rational preference; the result will be high customer loyalty.
Todays companies are facing their toughest competition ever in attracting the
customers. Customer-centered companies are adept at building customers, not just products;
55
they are skilled in market engineering, not just product engineering. Now-a-days companies
are thinking that it is the marketing or sales departments job to acquire and manage
customers, but, in fact, marketing is only one factor in attracting and keeping customers. The
best marketing department cannot sell products that are poorly made or fail to meet a need.
The marketing department can be effective only in companies whose employees have
implemented a competitively superior customer value-delivery system.

DEFINING CUSTOMER VALUE AND SATISFACTION:

Companys first task is to create customers. Customers are value maximizes, within
the bounds of search costs and limited knowledge, mobility and income. They form
an expectation of value and act on it. Whether or not the offer lives up to the value
expectations effects both satisfaction and repurchase probability.

TOTAL CUSTOMER SATISFACTION:

The challenge, according Jeffrey Gitomer, is not to produce satisfied customers-several
competitors can do this. The challenge is to produce delighted and loyal customers.
Companies seeking expand their profits and sales have to spend considerable time and
a resource searching for new customers whether the buyer is satisfied after purchase depends
on the offers performance in relation to the buyers expectations. In general, satisfaction is a
persons feelings of pleasure or disappointment resulting from comparing products perceived
performance in relation to his/her expectations. If the performance falls short of expectations,
the customer is dissatisfied. If the performance matches the expectations, the customer is
satisfied.
delighted.

If the performance exceeds expectations, the customer is highly satisfied of

56

The link between customer satisfaction and customer loyalty is not proportional.
Suppose customer satisfaction is rated on a scale from one to five. At a very low level of
customer satisfaction (Level One), Customers are likely to abandon the company and even
bad-mouth it. At levels two to four, customers are fairly satisfied but still find it easy to
switch when a better offer comes along.

At level five, the customer is very likely to

repurchase and even spread good word of mouth about the company.

High satisfaction or delight creates an emotional bond with the brand or company, not
just a rational preference.
Buyers form their expectations, from past buying experience, friends and associates
advice, marketers and competitors information and promises. If marketers raise expectations
two high, the buyer is likely to be disappointed.

However, if the company sets the

expectations too low, it would not attract enough buyers.

Some of todays most successful companys are raising expectations and delivering
performances to match. These companies are aiming for TCS-Total customer satisfactions.
Xerox, for example guarantees total satisfaction and will replace at its expense any dissatisfied
customers equipment within a period of 3 Years after purchase.

DELIVERING HIGH CUSTOMER VALUE:

The Key to generating high customer loyalty is to deliver high customer value.
According to Michael Lanning, in his delivering profitable value, a company must design a
competitively superior value proposition aimed at a specific market segment, backed by a
superior value delivery system.
The value proposition consists of the value consists of hole cluster of benefits the
57
company promises to deliver; it is more than the core positioning of the offering in addition to
tracking customer value expectations and satisfaction, companys need monitor their
competitors performance in those areas.
For customer centered companys, customer satisfaction is both a goal and marketing
tool. Companys that achieve high customer satisfaction ratings make sure that their target
market knows it.

MESURING SATISFACTION:
Although the customer centered firm seeks to create high customer satisfaction that is
not its main goal. If the company increases customer satisfaction by lowering its prices or
increasing its cervices, the result may be lower profits.

TOOLS

FOR

TRACKING

AND

MEASURING

CUSTOMER

SATISFACTION:
COMPLAINT AND SUGGESTION SYSTEMS:
A customer-centered organization makes it easy for customers to register suggestion
and complaints.

Some customers centered companies-P&G, general electric, Whirlpool-

establish hotlines with toll free numbers. Companies are also using Web sites and E-mail for
quick, two-way communications.

CUSTOMER SATISFACTION SURVEYS:

Studies show that although customers are dissatisfied with one out of every four
purchases, less that 5% will complain. Most customers will buy less or switch suppliers.
Responsive companies measure customers satisfaction directly by conducting periodic
surveys.

58
While collecting customer satisfaction
data, it is also useful to ask additional

questions to measure repurchase intention and to measure the likelihood are willingness to
recommend the company and brand to others.

GHOST SHOPPING:
Companies can hire people to pose as potential buyers to report on strong and week
points experienced in buying the companys and competitors products.

These mystery

shoppers can even test how the companys sales personal handle various situations.

LOST CUSTOMER ANALYSIS:

Companies should contact customers who have stopped buying or who have switched
to another supplier to learn why this happened. Not only is it important to
Conduct exit interviews when customers first stop buying; it also necessary to monitor
customer loss rate.

DELIVERING CUSTOMER VALUE & SATISFACTION:

In a hipper competitive economy with increasingly rational buyers, a company can
only win by creating and delivering superior value.

This involves the following five

capabilities-understanding customer value, creating customer value, delivering customer

value, capturing customer value and sustaining customer value. To succeed, a company needs
to use the concepts of a value chain and a value delivery network.

VALUE CHAIN:
Value chain is tool for identifying ways to create more customer value. Every firm is a
synthesis of activities that are performed to design, produced, marked, deliver and support its
product. The value chain identifies nine strategically relevant activities that create value and
cost in a specific business.

These nine value-creating activities consist of five primary

59

activities and four supporting activities.

The firms task is to examine its cost and performance in each value creating
activities and to look for ways to improve it. The firm should estimate its competitors cost and
performance as benchmarks against which to compare its own cost and performance.

The firms success depends not only on who well each departments performs its work,
but also on who well the various departmental activities are coordinated. Too often, company
departments act to maximize their interests.

VALUE DELIVERY NETWORK:

To be successful a firm also needs to look for competitive advantages beyond its own
operations, into the value chains of its suppliers, distributors and customer. Many companies
today have partnered its specific suppliers and distributors to create a superior value delivery
network also called supply chain.

ATTRACTING AND RETAINING CUSTOMERS:

In addition to working with partners-called partner relationship management many companies
are intent on developing stronger bonds with their customers- called customer relationship
management. This is the process of managing detailed information about individual customers
and carefully managing all the customer touch points with the aim of maximizing customer
loyalty.

60

ATTRACTING CUSTOMERS:
Todays customers are becoming harder to please. They are smarter, more price
conscious, more demanding, less forgiving and they are approached by many more
competitors with equal are better.

To generate leads, the company develops ads and places them in media that will reach
new prospectus; it sends direct mail and makes phone calls to possible new prospectus; its
sales people participate in trade shows where they might find new leads-and so on. All this
activity produces a list of suspects. The next task is to identify which suspects really good
prospectuses, by interviewing them, are checking on their financial standing, and so on. Then
it is time to send out the sales people.

COMPUTING THE COST OF LOST CUSTOMERS:

It is not enough to be skillful in attracting new customers; the company must keep
them and increase their business. Too many companies suffer from high customer defection.
It is like adding water to a leaking bucket.
There are steps a company can take to reduce the defection rate. First, the company
must define and measure its retention rate. Second, the company must distinguish the causes
of customer attrition and identify those that can be managed better. Third, the company needs
61
to estimate how much profit it loses when it loses customers. Fourth, the company needs
figure out how much it would cost to reduce the defection rate. As long as the cost is less than
the lost profit, the company should spend the money. Finally, nothing bets listing to the
customers. Some companies have created an ongoing mechanism that keeps senior managers
permanently plugged in to frontline customers feed back.

NEED FOR CUSTOMER RETENTION:

Unfortunately, most marketing theory and practice center on the art attracting new
customers rather than on retaining and cultivating existing ones. The emphasis traditionally
has been on making sales rather than building relationships, on selling rather than caring for
the customers after words.
A Company would be wise to measure customer satisfaction regularly, because the key
to customer retention is the customer satisfaction.
A highly satisfied customer stays loyal longer, buys more as the company introduces
new products and upgrades existing products, talks favorably about the company and its
products, pays less attention to competing brands and is less sensitive to price, offers product
are service ideas to the company.
Some companies think they are getting a sense of customer satisfaction by tallying
customer complaints, but 96% dissatisfied customers do not complain-many just stop buying.
The best thing a company can do is to make it easy for the customer to complain.
62
A customer is the most important person ever in this office in person or by mail.
Customer is not dependent on us we are dependent on him. A customer is not an
interruption of our work; he is the person of it. We are not doing a favor by serving him, he is
doing us favor by giving us the opportunity to do so.
A customer is not someone to argue or match wits with. Nobody ever won an argument
with a customer. A customer is a person who brings us wants. It is our job to handle them
profitably to him and to ourselves.

Today, more companies are recognizing the importance of satisfying and retaining
customers. Satisfied customers constitute the company's relationship capital. If the company
were to sell, the acquiring company would have to pay not only for the plant and equipment
and the brand name, but also for the delivered customer base, namely, the number and the
value of the customers who would do business with the new firm. There are some interesting
facts bearing on customer retention.
Acquiring new customers can cost five times more than the costs involved in satisfying
and retaining current customers.
The Average Company loses 10% of its customers each year.
A 5% reduction in the customer defection rate can increase profits by 25% to 85%,
depending on the industry.
The customer profit rate tends to increase over the life of the retained customer.

CUSTOMER RELATIONSHIP MANAGEMENT (CRM):

The aim of customer relationship63management is to produce high customer equity.
Customer equity is the total of the discounted lifetime values of the entire firm's customers.
Clearly, the more loyal the customers are, the higher the customer equity.
According to Rust Zeithamal and Lemon there are three drivers of customer equity
Value equity
Brand equity
Relationship equity

VALUE EQUITY:
Value equity is the customer's objective assessment of the utility of an offering based
on perceptions of its benefits relative to its costs. The sub drivers of equity are quality, price,
and convenience. Value equity especially drives customer equity in business markets.

BRAND EQUITY:
Brand equity is the customer's subjective and intangible assessment of the brand above
and below its objectively perceived value. The sub drivers of brand equity are customer brand
awareness, customer attitude towards brand, customer's perception and brand ethics. Brand
equity is more important than the other drivers of customer equity where products are less
differentiated and have more emotional impact.

RELATIONSHIP EQUITY:
Relationship equity is the customer's tendency to stick with the brand, above and
beyond objective and subjective assessments of its worth. Subdrivers of relationship equity
include loyalty programs, special recognition, and treatment programs.

FORMING STRONG CUSTOMER BONDS:

Companies that want to form strong customer bonds need to follow some basics given
below

Get cross-departmental participation in planning and managing the customer satisfaction

and retention.

Integrate the voice of the customer in all business decisions.

Create superior products, services, and experiences for the target market.

64

CHAPTER - 5
DATA ANALYSIS
&
INTERPRETATION

1. THE STATUS OF THE CUSTOMER.

TABLE:
No Of Options
Student
Employee
Profession
Business
Total

No Of Respondents
15
24
28
33
100

% Of Respondents
15
24
28
33
100

GRAPHICAL REPRESENTATION:
35
30
25
20
15
10
5
0
Student

INTERPRETATION:

Employee

Profession

Business

From the above analysis I have found that 15% of Respondents are students and 24%
of Respondents are employees and 28 % of Respondents are profession and finally 33% of
Respondents are business people.

2) INCOME OF CUSTOMERS PER ANNUM.

TABLE:
No Of Options
Less than 1 Lakh
1 Lakh-2Lakhs
2 Lakhs-3Lakhs
Greater than 3 Lakhs
Total

65
No Of Respondents
30
35
20
15
100

% Of Respondents
30
35
20
15
100

GRAPHICAL REPRESENTATION:

35
30
25
20
15
10
5
0

Less than 1
Lakh

INTERPRETATION:

1 Lakh2Lakhs

2 Lakhs3Lakhs

Greater
than 3
Lakhs

From the above analysis I have found that 30% of the Respondents have annual
income of less than 1 lakh and nearly 35% have annual income of 1 lakh -2 lakh and 20% have
annual income of 2 lakh -3 lakh and 15% have annual income of above 3 lakh
3) NUMBER OF EDC MACHINES USED BY THE CUSTOMERS.
TABLE:
No Of Options
One
Two
Three
Four
Total

66
No Of Respondents
57
28
15
0
100

% Of Respondents
57
28
15
0
100

GRAPHICAL REPRESENTATION:

One
Two
Three
Four

INTERPRETATION:

From the above analysis I have found that nearly 57% of Respondents are using only
one EDC Machines and 28% two EDC Machines and 33% three EDC Machines and no one using
four EDC Machines.

4) BANKS USING EDC MACHINES.

TABLE:
No Of Options
HDFC
ICICI
ANDHRABANK
BOB
Total

67
No Of Respondents
58
17
12
13
100

% Of Respondents
58
17
12
13
100

GRAPHICAL REPRESENTATION:

60
50
40
30
20
10
0

HDFC

INTERPRETATION:

ICICI

ANDHRABANK

BOB

From the above analysis I have found that 58% of the respondents are using HDFC
EDC Machines and 17% are using ICICI EDC Machines and 12% are using ANDHRA
BANK EDC Machines and finally 13% are using BOB EDC Machines.

5) PERIOD OF USING EDC MACHINES.

TABLE:
No Of Options
Below 1 year
1-2 years
2-3 Years
Above 3 years
Total

68
No Of Respondents
28
32
22
18
100

% Of Respondents
28
32
22
18
100

GRAPHICAL REPRESENTATION:
35
30
25
Below 1 year

20

1-2 years
2-3 Years

15

Above 3 years

10
5
0
Below 1 year

INTERPRETATION:

1-2 years

2-3 Years

Above 3 years

From the above analysis I have found that 28% of the Respondents are using the EDC
Machines from 1 year below and nearly 32% of the respondents are using the EDC Machines
from 1-2 years and 22% of Respondents are using EDC Machines from 2-3 years and finally
18% of the Respondents are using EDC Machines from above 3 years.
6) MONTHLY TURNOVER ON CARDS.
TABLE:
69
No Of Options
No Of Respondents
Up to 25,000
12
25,001 -50,000
33
50,001-1,00,000
29
Above 1,00,000
26
Total
100
GRAPHICAL REPRESENTATION:

% Of Respondents
12
33
29
26
100

Above 1,00,000

50,001-1,00,000

Above 1,00,000
50,001-1,00,000
25,001 -50,000
Up to 25,000

25,001 -50,000

Up to 25,000

10

15

20

25

30

35

INTERPRETATION:
From the above analysis I have found that the Monthly Turnover on the cards
are 12% is up to the level of 25,000 and 33% is between 25,001-50,000 and 29% is
between 50,001-1, 00,000 and 26% is above 1,00,000.
7) OPINION ON HDFC.
TABLE:
No Of Options
Excellent
Good
Average

No Of Respondents
19
38
27

70

% Of Respondents
19
38
27

No opinion.

16

16

Total

100

100

GRAPHICAL REPRESENTATION:

40
35
30
25

Excellent
Good

20

Average
No opinion

15
10
5
0
Excellent

Good

Average

No opinion

INTERPRETATION:
From the above analysis I have found that, 19% of the Respondents opinion is excellent
and 38% of the Respondents opinion is good and 27% Respondents opinion is average and
finally 16% Respondents have no opinion regarding HDFC.
8) OPINION REGARDING HDFC MANAGEMENT.
TABLE:
No Of Options
Good
Average
Below average
No opinion
Total

71
No Of Respondents
22
46
18
14
100

% Of Respondents
22
46
18
14
100

GRAPHICAL REPRESENTATION:

Good
Average
Below average
No opinion

INTERPRETATION:

From the above analysis I have found that 22% of the Respondents said that they are good
and 46% said that they are average and 18% said that they are below average and 14%
have no opinion regarding management.

9) OPINION REGARDING EDC MACHINES USED IN HDFC BANK.

TABLE:
No Of Options
Satisfied
To some extent
Dissatisfied
Total

No Of Respondents
72
55
20
25
100

% Of Respondents
55
20
25
100

GRAPHICAL REPRESENTATION:

60
50
40
30
20
10
0

Satisfied

To some extent

Dissatisfied

INTERPRETATION:
From the above analysis I have found that 55% of the customers are satisfied with the
HDFC EDC Machines provided by the bank and 20% of the customers provided these

Machines to some extent and remaining customers are dissatisfied with the these Machines
provided by the bank.

10) TIMINGS OF WORKING OF EDC MACHINES IN THE BANK.

TABLE:
No Of Options
Satisfied
To some extent
Dissatisfied
Total

73Respondents
No Of
60
28
12
100

GRAPHICAL REPRESENTATION:

% Of Respondents
60
28
12
100

60
50
40
Satisfied
30

To some extent
Dissatisfied

20
10
0
Satisfied

To some extent

Dissatisfied

INTERPRETATION:
74
From the above analysis I have found that 60% of them have satisfied with available
timings of work and 28% of them want to some extent in timings and only 12% of them are
dissatisfied with the available time.

11) OPINION REGARDING THE INFORMATION PROVIDED TO YOU IN THE

BANK.
TABLE:

No Of Options

No Of Respondents

% Of Respondents

Satisfied

33

33

To some extent

56

56

Dissatisfied

11

11

Total

100

100

GRAPHICAL REPRESENTATION:

75
Satisfied

8 8 8

To some extent
Dissatisfied

INTERPRETATION:
From the above analysis I have found that 33% of the Respondents are satisfied and
56% of Respondents want to some extent and only 11% Respondents are dissatisfied with the
information provided in the bank.

12) OPINION REGARDING OTHER FACILITIES PROVIDED BY THE BANK.

TABLE:
No Of Options

No Of respondents

% Of Respondents

Satisfied

57

57

To some extent

28

28

Dissatisfied

15

15

Total

100

100

GRAPHICAL REPRESENTATION:

60
50
40
30
20
10
0

Satisfied

INTERPRETATION:

To some extent

Dissatisfied

From the above analysis I have found that 57% of the Respondents are satisfied with
other facilities provided by the bank and 28% of the Respondents want to some extent and
remaining 15% are dissatisfied with other facilities provided by the bank.

13) EXPECTING ANY FURTHER BENEFIT FROM HDFC.

76

TABLE:
No Of Options
Yes
No
To some extent
Total

No Of Respondents
48
33
19
100

GRAPHICAL REPRESENTATION:

% Of Respondents
48
33
19
100

Yes
No
To some extent

INTERPRETATION:
From the above analysis77
I have found that, 48% of the Respondents expecting
further benefits from HDFC and 33% of Respondents did not want any benefits and remaining
19% of the Respondents want these benefits to some extent.
14) OPINION REGARDING THE SERVICES PROVIDED BY THE BANK.
TABLE:
No Of Options

No Of Respondents

% Of Respondents

Good

22

22

Average

50

50

Below Average

18

18

No Opinion

10

10

Total

100

100

GRAPHICAL REPRESENTATION:

50
40
30
20
10
0

Good

Average
78

Below
Average

No Opinion

INTERPRETATION:
From the above analysis I have found that 22% of the Respondents are thinking that
services provided by the bank is good and 50% think that these services are average and 18%
think that these are below average and 10% think that they have no opinion regarding services
provided by the bank.

15) OPINION REGARDING RENTS AND RATES OF EDC MACHINES.

TABLE:
No Of Options
Excellent

No Of Respondents
38

% Of respondents
38

Very Good

23

23

Good

21

21

Average

18

18

Total

100

100

GRAPHICAL REPRESENTATION:

40
35
30
25
20
15
10
5
0

Excellent

Very Good

79
Good

Average

INTERPRETATION:
From the above analysis I have found that nearly 38% Respondents thinking that the

CHAPTER 6

rents and rates of HDFC EDC Machines is excellent and 23% thinking that these rents and
rates are very good and 21% thinking that these rents and rates are good and finally 18%
thinking that these rents and rates are average.

FINDINGS
SUGGESTIONS
CONCLUSION

FINDINGS
1. It is found that the customers are satisfied with HDFC EDC machines.
2. It is found that the HDFC banks are providing good services.

3. It is found in the survey that, the Rents and Rates of HDFC EDC machines is high when
compared to other banks.
4. It is found that, most of the people are using EDC machines from 1-2 years.
5. It is found that the customers opinion about HDFC is good.
6. It has been found from the survey that, most of the customers are using HDFC EDC
machines.
7. It is found that the customers are not satisfied with HDFC bank.
8. It is found that HDFC bank service is not beneficial to customers compared with other
bank.

9. IT is found that, most of the customers are having only one EDC machines.
10. It is found in the survey that, the mostly turn over on cards are ranging from 25,00050,000.
11. It is found that most of the customers
wanted timings from 8 a.m to 5 p.m.
80

SUGGESTIONS
1. It is suggested to the Management to decrease the Rents and Rates of EDC machines.

2. It is suggested to the Management to provide more benefits to the customers.

3. It is suggested to HDFC bank Manager to provide more EDC machines
.
4. It is suggested to the management to improve monthly turn over on cards.
5. It is suggested to the HDFC bank Management to increase the timings.

81

CONCLUSION

The bank is also aggressively increasing its deposit base by opening branches.
This has reduced the bank's dependence on wholesale deposits, which are costlier and more
volatile. Certificates of Deposits (CDs) have reduced from 28% of total deposits to 2.8%..
Moreover, the bank has an equity tie-up with a foreign commercial bank, National
'Westminster (NatWest) of the UK and some capital has also come from overseas corporate
bodies with a presence in Singapore and the Gulf. This bas not only helped the bank in
building a network share technology but has also helped it to attract NRI funds and lower its
cost of funds. Another way the bank has used to reduce its cost of funds is by building a franchise of products which will give it float money.. This activity provides the bank with money
at zero interest rate for a short period of time.
As the human history speeds towards with its awe-inspiring problems and
opportunities, the subject marketing is attracting increasing attention from companies,
institutions and nations. Marketing has82
evolved from its origins in distribution and selling into
a comprehensive philosophy for relating any organization dynamically to its market.
It is found that, most of the people are having only one EDC machine.It is a finding
from the survey that, most of the people are using HDFC EDC machine. It is suggested to
HDFC bank manger, to improve there monthly turnover on cards

QUESTIONNAIRE

Name

Age

Gender

Education qualification

Designation

1) What is the status of the customers?

a) Student

b) Employee

c) Profession

d) Business

2) What is the Income of the customers per annum?

a) < 1 Lakh
c) 2 Lakh 3 Lakh

b) 1 Lakh - 2 Lakh
d) > 3 Lakh

3) How many EDC machines are used by the customers?

a) One

b) Two

c) Three

d) Nill

4) Which banks are using EDC machines?

a) HDFC

b) ICICI

c) AB

d) BOB

5) Since how long you are using EDC machines?

a) Below 1 year

b) 1- 2 years

c) 2 -3 year

d) Above 4 years

6) What is the Monthly Turnover on cards?

a) Up to 25,000

b) 25,001 - 50,000

c) 50,001 1, 00,000

d) Above 1, 00,000

7) What is your opinion on HDFC?

a) Excellent

b) good

c) average d) No opinion

8) What is your opinion about HDFC management?

a) Satisfied b) To some extent c) Dissatisfied
9) What is your opinion regarding EDC machines used in HDFC bank?
a) Satisfied

b) To some extent c) Dissatisfied

10) What are the timings of the working of EDC machines in the bank?
a) 8 a.m-5 p.m b) 10 a.m-6p.m c) 9.30 a.m- 5 p.m.
11) What is the Opinion regarding the information provided to you in the bank?
a) Satisfied b) To some extent

c) Dissatisfied

12) What is your opinion regarding other facilities provided to you in the bank?
a) Satisfied

b) To some extent

c) Dissatisfied

13) Are you want any further benefits from HDFC?

a) Yes

b) No

c) To some extent

14) Are you satisfied with the Service provided by the Bank?
a) Good
c) Below average

b) Average
d) No opinion

15) What is your opinion regarding Rents and Rates of EDC machines?
a) Excellent

b) Very good

c) Good

d) Average

16) Suggestions

BIBLIOGRAPHY
TEXT BOOKS

Sl.No
1
2

Author
Philip Kotler

Book Name
Marketing
Management

SHH Kazmi &

Satish K Batra

Advertising &
customer
Satisfaction

Edition
11
2

COMPANY SOURCES
Profile
Annual Reports
Journals
WEBSITES
www.hdfcbank.co.in

www.learnmarketing.net

BIODATA
Name

DANGETI SUDHA

Publication
Pearson
Education Pvt
Ltd
Anurag Jain for
Excel Books
Publishers

Fathers Name
Date of Birth
Marital Status

:
:
:

Veera Bhadra Rao

6th Jun 1988
Un married

Nationality

:
:

Hindu
Indian

Hobbies

Gardening, Reading Books, Watching T.V.

Permanent Address

D/o Veera bhadarao,

Door no: 6-4-81,
Unupulavari street,
Gubbalavaripet,
RAMACHANDRAPURAM.

Religion

E.G.Dt.

EDUCATIONAL QUALIFICATIONS;
QUALIFICATION

Professional

COLLEGE / UNIVERSITY

MBA (Master of Business Administration)

YEAR

AGGREGATE

2007-09

72%
(Pursing)

with Human Resource and Marketing

specialization from JNTU in
ADITYA PG STUDIES,
Surampalem.
Graduation

B.Sc (Biotech) from Andhra University.

In V.S.LAKSHMI WOMENS COLLEGE,
Ram Chandra puram

2008

70%

Intermediate

Bi.p.c From Board of Intermediate Education,

2005

81%

2003

78%

A.P., in
SANTINEKHATIAN JUNIOR COLLEGE,
Ram Chandra puram.
S.S.C.

Sun shine English medium school,

Ram Chandra puram.