mris final.pdf

A PROJECT REPORT

ON

COMPARISON

OF

SERVICE QUALITY BETWEEN

PUBLIC AND PRIVARE SECTOR BANKS

SUBMITTED BY:

NIRAV PATEL (13M54)

RONAK SHARMA (13M59)

SUBMITTED TO:

DR. DARSHNA R. DAVE

G H PATEL POST GRADUATE INSTITUTE OF BUSINESS

MANAGEMENT

SARDAR PATEL UNIVERSITY

VALLABH VIDYANAGAR

2013-2015

PREFACE

G.H. Patel Postgraduate Institute of Business Management is a reputed institute which was

established in 1989. The course of Marketing Research in M.B.A program of this institute

provides opportunities for the students to carry out practical research on the various topics of

their choice for the purpose of survey. We have carried out our research project on the topic

named “Consumer Satisfaction towards Services provided by Indian Railway in region of

Vallabh vidyanagar”.

ACKNOWLEDGEMENT

This research work could never have been submitted without the major contribution of

several people.

Here we take this opportunity to thank Dr. Darshana Dave, our research guide, G H PATEL

POSTGRADUATE INSTITUTE OF BUSINESS MANAGEMENT, who has inspired,

supported and encouraged us throughout the work and has provided numerous suggestions of

great value.

We express our thanks for providing us necessary guidance to complete this course. Without

the help of the various respondents, we could not have been able to succeed in this research.

We would like to declare that mistakes in this project and report, if any, are solely our own.

ABSTRACT

The present study is undertaken to compare the services provided by Public and Private

Bakes. The study was done to find out the level of satisfactions and expectations from the

two Banking service providers and to compare them. This survey was done in Vallabh

Vidyanagar city. The study has equal number of respondents for both the service providers so

one can have a rational comparison. The data was processed using computer aided tools such

as MS-EXCEL, SPSS and descriptive analysis were used for analysis.

Table of Contents PREFACE........................................................................................................................................ 2

ACKNOWLEDGEMENT ............................................................................................................... 3

ABSTRACT ..................................................................................................................................... 3

EXECUTIVE SUMMARY................................................................. Error! Bookmark not defined.

1. INTRODUCTION ...................................................................... Error! Bookmark not defined.

2. LITERATURE REVIEW ........................................................... Error! Bookmark not defined.

3. RESEARCH METHODOLOGY .......................................................................................... 33

3.1 Objectives of the study ........................................................ Error! Bookmark not defined.

3.2 Scope of the study ................................................................ Error! Bookmark not defined.

3.3 Limitations ................................................................................ Error! Bookmark not defined.

1 INTRODUCTION

Banking in India in the modern sense originated in the last decades of the 18th century. The

first banks were Bank of Hindustan (1770-1829) and The General Bank of India, established

1786 and since defunct.

The largest bank, and the oldest still in existence, is the State Bank of India, which originated

in the Bank of Calcutta in June 1806, which almost immediately became the Bank of Bengal.

This was one of the three presidency banks, the other two being the Bank of Bombay and

the Bank of Madras, all three of which were established under charters from the British East

India Company. The three banks merged in 1921 to form the Imperial Bank of India, which,

upon India's independence, became the State Bank of India in 1955. For many years the

presidency banks acted as quasi-central banks, as did their successors, until the Reserve Bank

of India was established in 1935.

In 1969 the Indian government nationalised all the major banks that it did not already own

and these have remained under government ownership. They are run under a structure known

as 'profit-making public sector undertaking' (PSU) and are allowed to compete and operate

as commercial banks. The Indian banking sector is made up of four types of banks, as well as

the PSUs and the state banks; they have been joined since the 1990s by new private

commercial banks and a number of foreign banks.

Generally banking in India was fairly mature in terms of supply, product range and reach-

even though reach in rural India and to the poor still remains a challenge. The government

has developed initiatives to address this through the State Bank of India expanding its branch

network and through the National Bank for Agriculture and Rural Development with things

like microfinance. This also included the 2014 plan by the then prime minister to bring bank

accounts to the estimated 40% of the population that were still unbanked.

http://en.wikipedia.org/wiki/State_Bank_of_India

http://en.wikipedia.org/wiki/Bank_of_Calcutta

http://en.wikipedia.org/wiki/Bank_of_Bengal

http://en.wikipedia.org/wiki/Bank_of_Bombay

http://en.wikipedia.org/wiki/Bank_of_Madras

http://en.wikipedia.org/wiki/British_East_India_Company

http://en.wikipedia.org/wiki/British_East_India_Company

http://en.wikipedia.org/wiki/Imperial_Bank_of_India

http://en.wikipedia.org/wiki/State_Bank_of_India

http://en.wikipedia.org/wiki/Reserve_Bank_of_India


http://en.wikipedia.org/wiki/Government_of_India

http://en.wikipedia.org/wiki/Nationalised

http://en.wikipedia.org/wiki/Government-owned_corporation#India

http://en.wikipedia.org/wiki/Commercial_bank

http://en.wikipedia.org/wiki/National_Bank_for_Agriculture_and_Rural_Development

http://en.wikipedia.org/wiki/Unbanked

Structure of Banking Sector in India

Current period

All banks which are included in the Second Schedule to the Reserve Bank of India Act, 1934

are Scheduled Banks. These banks comprise Scheduled Commercial Banks and Scheduled

Co-operative Banks. Scheduled Commercial Banks in India are categorised into five different

groups according to their ownership and/or nature of operation. These bank groups are:

State Bank of India and its Associates

Nationalised Banks

Private Sector Banks

Foreign Banks

Regional Rural Banks.

In the bank group-wise classification, IDBI Bank Ltd. is included in Nationalised Banks.

Scheduled Co-operative Banks consist of Scheduled State Co-operative Banks and Scheduled

Urban Cooperative Banks.

Growth of Banking in India of Scheduled Commercial Banks

In

dic

ato

rs

31 March of

2005 2006 2007 2008 2009 2010 2011 2012 2013

Num

ber

of

Com

merci

al

Bank

s

284 218 178 169 166 163 163 169 151


In

dic

ato

rs

31 March of

2005 2006 2007 2008 2009 2010 2011 2012 2013

Num

ber

of

Bran

ches

70,373 72,072 74,653 78,787 82,897 88,203 94,019 102,377 109,811

Popu

lation

per

Bank

s(in

‘000)

16 16 15 15 15 14 13 13 12

Aggr

egate

Depo

sits

17002

billion(

US$280

billion)

21090

billion(

US$340

billion)

26119

billion(

US$420

billion)

31969

billion(

US$520

billion)

38341

billion(

US$620

billion)

44928

billion(

US$730

billion)

52078

billion(

US$840

billion)

59091

billion(

US$960

billion)

67504.5

4

billion(

US$1.1 t

rillion)

Bank

Credi

t

11004

billion(

US$180

15071

billion(

US$240

19312

billion(

US$310

23619

billion(

US$380

27755

billion(

US$450

32448

billion(

US$530

39421

billion(

US$640

46119

billion(

US$750

52605

billion(

US$850

http://en.wikipedia.org/wiki/Indian_rupee



















In

dic

ato

rs

31 March of

2005 2006 2007 2008 2009 2010 2011 2012 2013

billion) billion) billion) billion) billion) billion) billion) billion) billion)

Depo

sit as

perce

ntage

to G

NP (a

t

facto

r

cost)

62% 64% 69% 73% 77% 78% 78% 78% 79%

Per

Capit

a

Depo

sit

16281(U

S$260)

19130(U

S$310)

23382(U

S$380)

28610(U

S$460)

33919(U

S$550)

39107(U

S$630)

45505(U

S$740)

50183(U

S$810)

56380 (

US$910)

Per

Capit

a

Credi

10752(U

S$170)

13869(U

S$220)

17541(U

S$280)

21218(U

S$340)

24617(U

S$400)

28431(U

S$460)

34187(U

S$550)

38874(U

S$630)

44028 (

US$710)

http://en.wikipedia.org/wiki/Gross_national_product

http://en.wikipedia.org/wiki/Gross_national_product




















In

dic

ato

rs

31 March of

2005 2006 2007 2008 2009 2010 2011 2012 2013

t

Credi

t

Depo

sit

Ratio

63% 70% 74% 75% 74% 74% 76% 79% 79%

By 2010, banking in India was generally fairly mature in terms of supply, product range and

reach-even though reach in rural India still remains a challenge for the private sector and

foreign banks. In terms of quality of assets and capital adequacy, Indian banks are considered

to have clean, strong and transparent balance sheets relative to other banks in comparable

economies in its region. The Reserve Bank of India is an autonomous body, with minimal

pressure from the government.

With the growth in the Indian economy expected to be strong for quite some time-especially

in its services sector-the demand for banking services, especially retail banking, mortgages

and investment services are expected to be strong. One may also expect M&As, takeovers,

and asset sales.

In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its stake

in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an investor has

been allowed to hold more than 5% in a private sector bank since the RBI announced norms

in 2005 that any stake exceeding 5% in the private sector banks would need to be vetted by

them.

http://en.wikipedia.org/wiki/Retail_banking

http://en.wikipedia.org/wiki/Warburg_Pincus

http://en.wikipedia.org/wiki/Kotak_Mahindra_Bank

In recent years critics have charged that the non-government owned banks are too aggressive

in their loan recovery efforts in connexion with housing, vehicle and personal loans. There

are press reports that the banks' loan recovery efforts have driven defaulting borrowers to

suicide.

By 2013 the Indian Banking Industry employed 1,175,149 employees and had a total of

109,811 branches in India and 171 branches abroad and manages an aggregate deposit of

67504.54 billion (US$1.1 trillion or €840 billion) and bank credit of 52604.59

billion (US$850 billion or €650 billion). The net profit of the banks operating in India was

1027.51 billion (US$17 billion or €13 billion) against a turnover of 9148.59

billion (US$150 billion or €110 billion) for the financial year 2012-13.

Adoption of banking technology

The IT revolution has had a great impact on the Indian banking system. The use of computers

has led to the introduction of online banking in India. The use of computers in the banking

sector in India has increased many folds after the economic liberalisation of 1991 as the

country's banking sector has been exposed to the world's market. Indian banks were finding it

difficult to compete with the international banks in terms of customer service, without the use

of information technology.

The RBI set up a number of committees to define and co-ordinate banking technology. These

have included:

In 1984 was formed the Committee on Mechanisation in the Banking Industry

(1984) whose chairman was Dr. C Rangarajan, Deputy Governor, Reserve Bank of India.

The major recommendations of this committee were introducing MICR technology in all

the banks in the metropolises in India.[14] This provided for the use of standardized

cheque forms and encoders.

In 1988, the RBI set up the Committee on Computerisation in Banks (1988) headed by

Dr. C Rangarajan. It emphasized that settlement operation must be computerized in

the clearinghouses ofRBI

in Bhubaneshwar, Guwahati, Jaipur, Patna and Thiruvananthapuram. It further stated that

there should be National Clearing of inter-

city chequesat Kolkata, Mumbai, Delhi, Chennai and MICR should be made operational.

It also focused on computerisation of branches and increasing connectivity among

http://en.wikipedia.org/wiki/Credit_(finance)

http://en.wikipedia.org/wiki/Financial_year

http://en.wikipedia.org/wiki/Online_banking

http://en.wikipedia.org/wiki/MICR

http://en.wikipedia.org/wiki/Banking_in_India#cite_note-14

http://en.wikipedia.org/wiki/Clearing_house_(finance)

http://en.wikipedia.org/wiki/Bhubaneshwar

http://en.wikipedia.org/wiki/Guwahati

http://en.wikipedia.org/wiki/Jaipur

http://en.wikipedia.org/wiki/Patna

http://en.wikipedia.org/wiki/Thiruvananthapuram

http://en.wikipedia.org/wiki/Cheque

http://en.wikipedia.org/wiki/Kolkata

http://en.wikipedia.org/wiki/Mumbai

http://en.wikipedia.org/wiki/Delhi

http://en.wikipedia.org/wiki/Chennai





branches through computers. It also suggested modalities for implementing on-line

banking. The committee submitted its reports in 1989 and computerisation began from

1993 with the settlement between IBA and bank employees' associations.

In 1994, the Committee on Technology Issues relating to Payment systems, Cheque

Clearing and Securities Settlement in the Banking Industry (1994)[17] was set up under

Chairman W S Saraf. It emphasized Electronic Funds Transfer (EFT) system, with the

BANKNET communications network as its carrier. It also said that MICR clearing

should be set up in all branches of all those banks with more than 100 branches.

In 1995, the Committee for proposing Legislation on Electronic Funds Transfer and other

Electronic Payments (1995)[18] again emphasized EFT system.

The total number of automated teller machines (ATMs) installed in India by various

banks as of end June 2012 is 99,218.[19] The new private sector banks in India have the

most ATMs, followed by off-site ATMs belonging to SBI and its subsidiaries and then

by nationalised banks and foreign banks, while on-site is highest for the nationalised

banks of India.

Branches and ATMs of Scheduled Commercial Banks as of end March 2005[16]

Bank type Number of

branches

On-site

ATMs

Off-site

ATMs

Total

ATMs

Nationalised banks 33,627 38,606 22,265 60,871

State Bank of India 13,661 28,926 22,827 51,753

Old private sector

banks 4,511 4,761 4,624 9,385

New private sector

banks 1,685 12,546 26,839 39,385

http://en.wikipedia.org/wiki/Payment_system

http://en.wikipedia.org/wiki/Clearing_(finance)

http://en.wikipedia.org/wiki/Clearing_(finance)

http://en.wikipedia.org/wiki/Settlement_(finance)


http://en.wikipedia.org/wiki/Electronic_Funds_Transfer


http://en.wikipedia.org/wiki/Automated_teller_machine


http://en.wikipedia.org/wiki/Banking_in_India#cite_note-autogenerated1-16

Branches and ATMs of Scheduled Commercial Banks as of end March 2005[16]

Bank type Number of

branches

On-site

ATMs

Off-site

ATMs

Total

ATMs

Foreign banks 242 295 854 1,149

TOTAL 53,726 85,134 77,409 1,62,543

Expansion of banking infrastructure

Physical as well as virtual expansion of banking through mobile banking, internet banking,

tele banking, bio-metric and mobile ATMs is taking place since last decade and has gained

momentum in last few years. As per the census of 2011, 58.7% of households are availing

banking services in the country. There are 102,343 branches of Scheduled Commercial Banks

(SCBs) in the country, out of which 37,953 (37%) bank branches are in the rural areas and

27,219 (26%) in semi-urban areas, constituting 63% of the total numbers of branches in semi-

urban and rural areas of the country. However, a significant proportion of the households,

especially in rural areas, are still outside the formal fold of the banking system. To extend the

reach of banking to those outside the formal banking system, Government and Reserve Bank

of India (RBI) are taking various initiatives from time to time some of which are enumerated

below:

Opening of bank branches: Government had issued detailed strategy and guidelines on

Financial Inclusion in October 2011, advising banks to open branches in all habitations of

5,000 or more population in under-banked districts and 10,000 or more population in other

districts. Out of 3,925 such identified villages/habitations, branches have been opened in

3,402 villages/habitations (including 2,121 Ultra Small Branches) by end of April, 2013.

Each household to have at least one bank account: Banks have been advised to ensure

service area bank in rural areas and banks assigned the responsibility in specific wards in

urban area to ensure that every household has at least one bank account.

http://en.wikipedia.org/wiki/Banking_in_India#cite_note-autogenerated1-16

http://en.wikipedia.org/wiki/Government_of_India

Business Correspondent model: With the objective of ensuring greater financial inclusion

and increasing the outreach of the banking sector, banks were permitted by RBI in 2006

to use the services of intermediaries in providing financial and banking services through

the use of Business Facilitators (BFs) and Business Correspondents (BCs). Business

correspondents are retail agents engaged by banks for providing banking services at

locations other than a bank branch/ATM. BCs and the BC agents (BCAs) represent the

bank concerned and enable a bank to expand its outreach and offer limited range of

banking services at low cost, particularly where setting up a brick and mortar branch is

not viable. BCs as agents of the banks, thus, are an integral part of the business strategy

for achieving greater financial inclusion. Banks had been permitted to engage

individuals/entities as BC like retired bank employees, retired teachers, retired

government employees, ex-servicemen, individual owners of kirana/medical/fair price

shops, individual Public Call Office (PCO) operators, agents of Small Savings Schemes

of Government of India, insurance companies, etc. Further, since September 2010, RBI

had permitted banks to engage "for profit" companies registered under the Indian

Companies Act, 1956, excluding Non-Banking Financial Companies (NBFCs), as BCs in

addition to individuals/entities permitted earlier. According to the data maintained by

RBI, as in December, 2012, there were over 152,000 BCs deployed by Banks. During

2012-13, over 183.8 million transactions valued at 165 billion (US$2.7 billion) had been

undertaken by BCs till December 2012.

Swabhimaan Campaign: Under "Swabhimaan" - the Financial Inclusion Campaign

launched in February 2011, banks had provided banking facilities by March, 2012 to over

74,000 habitations having population in excess of 2000 using various models and

technologies including branchless banking through Business Correspondents Agents

(BCAs). Further, in terms of Finance Minister's Budget Speech 2012-13, the

"Swabhimaan" campaign has been extended to habitations with population of more than

1,000 inNorth Eastern and Hilly States and to habitations which have crossed population

of 1,600 as per census 2001. About 40,000 such habitations have been identified to be

covered under the extended "Swabhimaan" campaign.

Setting up of ultra-small branches (USBs): Considering the need for close supervision

and mentoring of the Business Correspondent Agents (BCAs) by the respective banks

and to ensure that a range of banking services are available to the residents of such

villages, Ultra Small Branches (USBs) are being set up in all villages covered through

http://en.wikipedia.org/wiki/Non-banking_financial_company

http://en.wikipedia.org/wiki/Union_budget_of_India

http://en.wikipedia.org/wiki/Northeast_India


BCAs under Financial Inclusion. A USB would comprise a small area of 100 sq ft

(9.3 m2) - 200 sq ft (19 m2) where the officer designated by the bank would be available

with a laptop on pre-determined days. While the cash services would be offered by the

BCAs, the bank officer would offer other services, undertake field verification and follow

up on the banking transactions. The periodicity and duration of visits can be

progressively enhanced depending upon business potential in the area. A total of over

50,000 USBs have been set up in the country by March 2013.

Banking facilities in Unbanked Blocks: All the 129 unbanked blocks (91 in North East

States and 38 in other States) identified in the country in July 2009, had been provided

with banking facilities by March 2012, either through Brick Mortar Branch or Business

Correspondents or Mobile van. As a next step it has been advised to cover all those

blocks with BCA and Ultra Small Branch which have so far been covered by mobile van

only.

USSD Based Mobile Banking: National Payments Corporation of India (NPCI) worked

upon a "Common USSD Platform" for all banks and telcos who wish to offer the facility

of Mobile Banking using Unstructured Supplementary Service Data (USSD) based

Mobile Banking. The Department helped NPCI to get a common USSD Code *99# for

all telcos. More than 20 banks have joined the National Uniform USSD Platform (NUUP)

of NPCI and the product has been launched by NPCI with BSNL and MTNL. Other

telcos are likely to join in the near future. USSD based Mobile Banking offers basic

Banking facilities like Money Transfer, Bill Payments, Balance Enquiries, Merchant

Payments etc. on a simple GSM based Mobile phone, without the need to download

application on a phone as required at present in the IMPS based Mobile Banking.

Steps taken by Reserve Bank of India (RBI) to strengthen the banking

infrastructure

RBI has permitted domestic Scheduled Commercial Banks (excluding RRBs) to open

branches in tier 2 to tier 6 cities (with population up to 99,999 as per census 2001)

without the need to take permission from RBI in each case, subject to reporting.

RBI has also permitted SCBs (excluding RRBs) to open branches in rural, semi-urban

and urban centres in North Eastern States and Sikkim without having the need to take

permission from RBI in each case, subject to reporting.

http://en.wikipedia.org/wiki/Unstructured_Supplementary_Service_Data

http://en.wikipedia.org/wiki/National_Payments_Corporation_of_India

http://en.wikipedia.org/wiki/Mobile_network_operators_of_India


http://en.wikipedia.org/wiki/Classification_of_Indian_cities

http://en.wikipedia.org/wiki/Classification_of_Indian_cities

Regional Rural Banks (RRBs) are also allowed to open branches in Tier 2 to Tier 6

centres (with population up to 99,999 as per Census 2001) without the need to take

permission from RBI in each case, subject to reporting, provided they fulfill the

following conditions, as per the latest inspection report:

CRAR of at least 9%;

Net NPA less than 5%;

No default in CRR / SLR for the last year;

Net profit in the last financial year;

CBS compliant.

Domestic SCBs have been advised that while preparing their Annual Branch Expansion

Plan (ABEP), they should allocate at least 25% of the total number of branches proposed

to be opened during the year in unbanked Tier 5 and Tier 6 centres i.e. (population up to

9,999) centres which do not have a brick and mortar structure of any SCB for customer

based banking transactions.

RRBs have also been advised to allocate at least 25% of the total number of branches

proposed to be opened during a year in unbanked rural (Tier 5 and Tier 6) Centres).

New private sector banks are required to ensure that at least 25% of their total branches

are in semi-urban and rural centres on an ongoing basis.

Private-sector banks

Axis bank Bandhan financial Bank Kotak Mahindra Bank

Catholic Syrian Bank South Indian Bank Karur Vysya Bank

City Union Bank Tamilnadu Mercantile Bank Karnataka Bank

Development Credit Bank Shivalik bank IndusInd Bank

Dhanlaxmi Bank Nainital Bank ICICI Bank

YES Bank RBL Bank Fedral Bank

IDFC Lakshmi Vilas Bank HDFC Bank

http://en.wikipedia.org/wiki/Regional_Rural_Bank

http://en.wikipedia.org/wiki/Capital_adequacy_ratio

http://en.wikipedia.org/wiki/Non-performing_asset

http://en.wikipedia.org/wiki/Core_banking

Public Sector Banks (Nationalised banks):

State Bank of India (SBI) State Bank of Patiala Canara Bank

State Bank of Bikaner &

Jaipur

State Bank of Saurashtra

Central Bank of India

State Bank of Hyderabad State Bank of Travancore Corporation bank

State Bank of Indore Bank of India Indian Bank

State Bank of Mysore Syndicate Bank Indian overseas bank

UCO Bank Bank of Baroda Oriental Bank of Commerce

Allahabad Bank Bank of Maharashtra Punjab & Sind Bank

Andhra Bank Dena Bank Union Bank of India

United Bank of India Vijaya Bank IDBI Bank

2 Literature review

1) A COMPARATIVE STUDY ON CUSTOMER SATISFACTION IN INDIAN PUBLIC

SECTOR AND PRIVATE SECTOR BANKS (WITH SPECIAL REFERENCE TO DELHI

AND NCR REGION)

MS.PALLAVIGUPTA,DR.CHHAYAMANGAL MISHRA, DR. TAZYN

RAHMAN(International Journal of Social Science & Interdisciplinary Research ISSN

2277 -3630 IJSSIR, Vol. 2 (8), AUGUST (2013))

The banking industry like many other financial service industries is facing a rapidly

changing Market, new technologies, economic uncertainties, fierce competition, and

especially more Demanding customers; and the changing climate has presented an

unprecedented set of Challenges. Customer service is one integral part of any facet of

banking and it defines future of Any banking organization. In banking sector, the whole

range of activity and generation of Income swivels around the customer. From a very

comfortable and peaceful environment, now the Indian Banking Sector is characterized

by stiff competition for the customer‟s satisfaction and profit war between different

banking groups i.e. (Private bank vs. Nationalized Bank). This paper tries to analyze the

comparative analysis of customer satisfaction among these two categories of banks –

public and private sector banks using the list of service attributes based on SERVQUAL

method. Simple random sampling technique is adopted and sample size of the data is 200

from the Delhi and NCR. This study is just a small step in understanding the multi

Dimensional construct of service quality and its implications in today’s

competitive environment.

2) Incorporating attitude towards Halal banking in an integrated service quality,

satisfaction, trust and loyalty model in online Islamic banking context

Muhammad Mohsin Butt, Muhammad Aftab (International Journal of BankMarketing

Vol. 31 No. 1, 2013 pp. 6-23)

The purpose of this paper is to empirically investigate the influence of consumer attitude

towards Halal banking on service quality and satisfaction, in an online Islamic banking

context. The proposed model also aims to investigate the relationships among service

quality, satisfaction, trust and loyalty.

This study enhances our understanding of how specific religious attitudes can positively

influence consumer assessments of a bank’s perceived e-service quality and their overall

e-satisfaction with it.

3) Social value in retail banking”

Juan Carlos Fandos Roig and Marta Estrada Guille´n

(International Journal of Bank Marketing Vol. 31 No. 5, 2013 pp. 348-367)

The aim of this study is to analyze the influence of perceived value on customer loyalty,

going into depth in the special case of social value.

The effect of social value on customer loyalty is also examined in two ways: as a

determinant of the attitude of the individual and as a normative component directly

influencing behavioural intentions. – It highlights the interest of social marketing

programs and corporate social responsibility to maintain the customer’s loyalty.

4) Are you providing the “right” customer experience? The case of Banca Popolare

di Bari

Philipp Klaus Michele Gorgoglione Daniela Buonamassa and Umberto Panniello and Bang

Nguyen,(International Journal of Bank MarketingVol. 31 No. 7, 2013 pp. 506-528)

The purpose of this paper is to model customer experience (CE) as a “continuum”,

labelled customer experience continuum (CEC). The paper adopts a CE quality construct

and scale (EXQ) to determine the effect of CE on a bank’s marketing outcomes. The

paper discusses the study’s theoretical and managerial implications, focusing on CE

strategy design.

paper empirically test a scale to measure customer experience quality (EXQ) for a

retail bank. The paper interviews customers using a means-end-chain approach and soft-

laddering to explore their CE perceptions with the bank. The paper classifies their

perceptions into the categories of “brand experience” (pre-purchase), “service

experience” (during purchase), and “post-purchase experience”. After a confirmatory

factor analysis, the paper conducts a survey on a representative customer sample. The

paper analyses the survey results with a statistical model based on the partial least

squares method. The paper tests three hypotheses first, Customers’ perceptions of brand,

service provider, and post-purchase experiences have a significant and positive effect on

their EXQ, second, EXQ has a significant and positive effect on the marketing

outcomes, namely share of wallet, satisfaction, and word-of-mouth, and third, the

overall effect of EXQ on marketing outcomes is greater than that of EXQ’s individual

dimensions.

5) Private and public banks: a comparison of customer expectations and perceptions”

Peter Kangis, Vassilis Voukelatos (Journal of Bank Marketing, Vol. 15 Issue: 7, pp.279

– 287)

Reports the findings of a survey among customers of private and public sector banks in

Greece on service quality perceptions and expectations. Finds that quality expectations

and evaluation of services received were marginally higher in the private than in the

public sector in most of the dimensions measured; The perception of the profile of

services received was, however, different between sectors, thus suggesting that they did

deliver a different quality of service. Discusses the implications for strategy since

sectoral differentiation in banking is becoming blurred as a result of increasing overlap

between services and competition from related and substitute industries

6) A Comparison of Indian Public and Private Sector Banks Based on Banking

Service Quality Model

Mihir Dash ,Garima Saxena (International Journal of Bank Marketing, Vol. 18 Iss: 4,

pp.144 – 159)

A more competitive banking environment has gradually been achieved through the

deregulation measures and permission granted to many private and foreign banks into

the Indian banking industry. These changes have also caused a compression of profits

and a re-orientation of banking strategy towards quality service provision. The

introduction of new private sector banks and foreign banks has decreased margins and

revenues to banks

The results of the study show that there is a significant difference between the

expectations and the perceptions of banking service quality of the respondents for all of

the variables under the Banking Service Quality (BSQ) model.

It was found that public banks fared better overall than private banks in terms of

perceptions of banking service quality. With the sudden collapse of some of the

oldest and most well-established international banks and the onset of the global financial

meltdown, customers have become more cautious about private banks. At the same time

the trust level on public banks have increased.

7) Consumer Trust in Banking Relationships in Europe

Raija Anneli Järvinen, (International Journal of Bank Marketing, Vol. 32 Issue: 6, pp

28-39)

The purpose of the article is to examine the content of consumer trust in the banking

sector and to find out if there are deviations in consumer trust in banks at the

organisational level, and at a service level, and between distinct services and between

various countries.

The study reveals deviations between various banking services and company level

results regarding consumers’ trust in their banking relationships. Consumer trust is the

highest in banking accounts and the lowest in investments and pensions.

The study also highlights deviations in consumer trust between European countries, and

identifies countries with low, medium and high trust in banking and in distinct banking

services

8) The impact of technology CSFs on customer satisfaction and the role of trust: An

empirical study of the banks in Malaysia

Muhammad Tahir Jan, Kalthom Abdullah,(International Journal of Bank Marketing,

Vol. 32 Iss: 5, pp.429 – 447)

This paper analyses the causal relationship that exists between technology CSFs and

customer satisfaction. It also investigates the mediating role of trust between these two.

For this purpose data were collected quantitatively from 349 employees working in

different banks, through self-administered questionnaire. The data analysis was

conducted using SPSS and AMOS software. Factor analysis was performed to extract

and decide on the number of factors underlying the measured variables of interest.

Structural equation modelling was then used to examine the variables and the fitness of

proposed model.

The result revealed that technology CSFs positively affect customer satisfaction.

Also, trust partially mediates the relationship between technology CSFs and customer

satisfaction. A significant positive impact of technology CSFs on trust, and trust on

customer satisfaction have also been obtained. The significant influence that technology

CSFs have on customer satisfaction and trust shows that technology-related CSFs are

inevitable for the success of customer relationship management (CRM) in financial

services industry, particularly banks. Policy makers of service industry in general and

financial service industry in particular may benefit from the findings of this study.

9) Building brand equity in retail banks: the case of Trinidad and Tobago

Meena Rambocas, Vishnu M. Kirpalani, Errol Simms, (International Journal of Bank

Marketing, Vol. 32 Iss: 4, pp.300 – 320)

The purpose of this paper is to investigate an integrated model mapping the influence of

brand affinity, customer experience, and customer satisfaction on brand equity in retail

banking.

Data were collected from 315 banking customers in Trinidad and Tobago through

personally administered structured questionnaires and analyzed with Structural Equation

Modelling.

The findings showed the mediating role of customer satisfaction in brand equity

relationships. The results also showed the pivotal role of brand affinity, customer

satisfaction, and service experience in explaining brand equity.

The study provides an integrated approach to brand building. It also offers an objective

framework brand owners can use to evaluate marketing investments. It also provides a

clear brand differentiation strategy for bank brands. Finally, it introduces cross-cultural

research in brand equity which can be a useful competitive tool for indigenous banks

and foreign banks seeking market expansion strategies.

10) Customer CSR expectations in the banking industry

Andrea Pérez, Ignacio Rodríguez del Bosque (International Journal of Bank


The purpose of this paper is to examine customer corporate social responsibility (CSR)

expectations in the crisis context of the Spanish banking industry. The paper also takes

into consideration the role that corporate governance structure plays in customer CSR

expectations.

Analysing 648 customers of savings banks and 476 customers of commercial banks,

several univariate statistics and two cluster analyses are implemented.

The authors identify significantly steady patterns in the CSR expectations of savings

banks and commercial banks customers. The customers of both types of banking

companies have similar high expectations concerning the CSR oriented to customers,

shareholders and supervising boards, employees, the community and legal and ethical

CSR. Also customers of both types of banking companies can be consistently classified

as customer oriented, legally (customer)-oriented and CSR-oriented customers

depending on their CSR expectations.

11) Linking satisfaction to share of deposits: an application of the Wallet Allocation

Rule",

Lerzan Aksoy, (2014) (International Journal of Bank Marketing, Vol. 32 Iss: 1, pp.28 –

42)

Despite the fact that customer satisfaction is among the most widely used metrics by

managers, the link with share of deposits tends to be weak. Using a recent innovative

approach termed the “Wallet Allocation Rule (WAR)” this research investigates

whether measuring satisfaction relative to other competitors used exhibits a stronger

correlation to share of deposits compared to measuring absolute satisfaction with the

focal firm/product.

A survey approach was used with a sample of 4,712 banking customers across the

USA. Using the WAR, each respondent's satisfaction ratings were transformed into

relative rankings and used to estimate their share of deposits.

The results confirmed that at both the individual and the aggregate level examining

relative ranked satisfaction correlates strongly with customers’ share of deposits. At the

individual level relative satisfaction explains 55 percent of the variance in share of

deposits, as opposed to only 9 percent for absolute satisfaction.

The findings indicate that managers need to rethink their current approach to

satisfaction measurement and consider measuring their customers’ satisfaction relative

to competitors used. Furthermore, using aggregate level absolute satisfaction in

managerial decision making can be misleading.

12) Using a multiple-attribute approach for measuring customer satisfaction with

retail banking services in Kuwait

Abdulkarim S. Al-Eisa, Abdulla M. Alhemoud, (2009 International Journal of Bank


The purpose of this paper is to attempt to identify the most salient attributes that

influence customer satisfaction with retail banks in Kuwait and to determine the level

of the overall satisfaction of the customers of these banks

A multiple-attribute approach proposed by Shin and Elliott in 2001 was employed. This

approach was applied in the analysis of data collected from a convenient sample of 863

actual customers of retail banks in Kuwait.

The most crucial attributes for predicting customer satisfaction with retail banks in

Kuwait were fast service, courtesy and helpfulness of employees and availability of

self-banking services. The vast majority of the customers of retail banks in Kuwait

(nearly 81 percent) are either satisfied or very satisfied with the services of their banks.

A number of very important attributes, such as those related to loans and credit cards

were not examined due to social reasons. The unavailability of lists of existing

customers and their contacts made it not possible to draw a random sample from the

target population of this study.

To maintain a competitive edge in the market, the managers of retail banks in Kuwait

need to be updated about technological advances and to invest in those that

satisfactorily enhance technology-based encounters with their customers. These

managers also need to focus on minimizing encounter failures in service delivery. For a

retail bank in Kuwait, sufficient recovery efforts are needed so that dissatisfied

customers do not end up defecting.

13) The role of bank image for customers versus non-customers

Rafael Bravo, Teresa Montaner, José M. Pina, ( International Journal of Bank


The purpose of this paper is to analyse the corporate image of financial institutions

and its impact on consumer behaviour. More specifically, it aims to focus on the

differences between customers and non-customers of banking institutions.

Data were collected through five questionnaires involving five major Spanish

commercial banks. The questionnaires were answered by 450 individuals and SEM

methodology was used to test the hypotheses of the study.

Corporate image of commercial banks includes dimensions related to the services

offered, accessibility, corporate social responsibility, global impression, location and

personnel. Two alternative models were validated for customers and non-customers to

explain how corporate associations influence intention to use the bank's services. For

the case of current customers, satisfaction is a key mediating variable.

The study is focused on national commercial banks and corporate image of

individuals. Different stakeholders like employees can hold a different corporate

image. Moreover, the paper only considers intention to use as a dependant variable.

The effect of corporate associations on purchase intentions depends on the specific

type of associations and may be mediated through satisfaction. Results thus indicate

that firms have to use different marketing strategies when considering the individuals'

previous experience.

14) "Attitudes and behaviour in everyday finance: evidence from Switzerland",

Brigitte Fünfgeld, Mei Wang, (2009) International Journal of Bank Marketing, Vol. 27

Iss: 2, pp.108 – 128

In order to classify individuals based on their needs; this paper aims to consider both

self-stated attitudes and behaviours in a comprehensive range of daily financial

affairs. Furthermore, it aims to study the impacts of socio-demographic variables such

as gender, age, and education.

A questionnaire was answered by 1,282 respondents in the German-speaking part of

Switzerland. Factor analysis revealed five components. Based on these components a

two-step cluster analysis (Ward and K-means analyses) identified distinct subgroups.

Linear regressions were used to investigate the impacts of socio-demographic

variables.

Factor analysis revealed five underlying dimensions of financial attitudes and

behaviour: anxiety, interests in financial issues, decision styles, need for precautionary

savings, and spending tendency. Cluster analysis segmented the respondents into five

subgroups based on these dimensions with an ascending order of specific needs for

financial products. Gender, age, and education were found to have significant impacts.

Real consumption behaviour cannot be observed through the survey, which limits the

external validity of the study.

The segmentation identifies different levels of financial competence and needs for

financial products. It allows financial service providers to offer more effective advice

and to meet customers on their own level to improve personal financial management.

15) The role of satisfaction and website usability in developing customer loyalty and

positive word-of-mouth in the e-banking services",

Luis V. Casaló, Carlos Flavián, Miguel Guinalíu, (2008 International Journal of Bank

Marketing, Vol. 26 Iss: 6, pp.399 - 417

Customer loyalty and positive word-of-mouth (WOM) have been traditionally two

main goals aimed at by managers. Focusing on the online banking, the importance of

these concepts is even greater due to the increasing competence in electronic

commerce. Thus, the purpose of this paper is to characterize both concepts in the e-

banking context.

The influence of satisfaction and website usability in developing customer loyalty

and positive WOM in the e-banking business were measured. After the validation of

measurement scales, hypotheses are contrasted through structural modelling.

This research showed that satisfaction with previous interactions with the bank

website had a positive effect on both customer loyalty and positive WOM. In

addition, website usability was found to have a positive effect on customer

satisfaction and, as expected, loyalty was also significantly related to positive WOM.

In order to develop customer loyalty and positive WOM, banks that operate in the

internet should: prioritize ease-of-use in website development, and identify the needs

of online customers (e.g. in terms of services offered) in order to offer them what

they really want.

16) "Demographic influences on behaviour: An update to the adoption of bank delivery

channels",

Ana S. Branca, (International Journal of Bank Marketing, Vol. 26 Iss: 4, pp.237 – 259)

The purpose of this paper is to examine how demographic characteristics contribute to

consumers' decision on bank delivery channels' usage, namely the direct and indirect

demographic influence on channel usage frequency via cognitive and affective

mediators.

The consumer usage frequency pattern concerning the main bank delivery channels

and its determinants are modelled and analysed with a questionnaire sent to 24,000

bank customers. This stage was preceded by a series of in-depth interviews to bank

managers and bank customers.

Empirical evidence suggests that demographic variables' influence over consumers'

usage frequency decision has both a direct and indirect component. These influences

are identified by delivery channel.

The main limitation derives from the nature of empirical results and their

generalization to other samples and contexts. Nevertheless, precautions recommended

in the literature to overcome this limitation were followed.

Bank managers will benefit from knowing, by channel, which demographic

characteristics have the desired direct and indirect impact on usage frequency. This

information will improve bank managers' efforts to encourage customers to favour a

specific delivery channel.

17) “Performance benchmarking and strategic homogeneity of Indian banks”

Avinandan Mukherjee, Prithwiraj Nath, Manabendra Nath Pal (International Journal

of Bank Marketing, Vol. 20 Issue: 3, pp.122 – 139)

Explores the linkage between performance benchmarking and strategic

homogeneity of Indian commercial banks. Defines performance by how a bank is able

to utilize its resources to generate business transactions and is measured by their ratio,

which is then called the efficiency. Clusters banks based on similarity in business

policy which offers a framework for competitive positioning in the target market and

serves as a basis for long-term strategic focus. Finds that the public sector banks

generally outperform the private and foreign banks in this rapidly evolving and

liberalizing sector.

18) “Experience of customer satisfaction: a study of Indian public and private sector

banks”

Vinita Kaura, (International Journal of Bank Marketing, Vol. 31 Iss: 3, pp.167 – 186)

The purpose of this paper is to examine the effect of service quality, perceived price

and fairness and service convenience on customer satisfaction. It also aims to compare

multiple regression models between public and new private sector banks. Significant

difference in beta coefficient is found between public and private sector banks

regarding employee behavior, decision convenience, access convenience and post-

benefit convenience.

Dimensions of service convenience are decision convenience, access convenience,

transaction convenience, benefit convenience and post-benefit convenience.

19) “Customer Satisfaction: A Comparison of Public and Private Banks Of Pakistan”

Waqar ul Haq & Bakhtiar Muhammad(IOSR Journal of Business and

Management,ISSN: 2278-487X Volume 1, Issue 5 (July-Aug. 2012), PP 01-05)

This research is mainly based on primary data which has been collected through a

well-structured questionnaire (adapted from three different studies). The questionnaire

has been distributed to 351 different respondents on different chosen locations. This

paper makes a useful contribution as there are very low number of studies has been

conducted in Pakistan on such areas like price, technology, reliability, customer

service, location and infrastructure. This research shows that customer satisfaction

varies from person to person and, bank managers need to conduct more researches in

order to evaluate customer satisfaction more strongly.

20) “Customer Perception of E- banking services of Indian banks : some survey evidence”

by R.K.Uppal, (ICFAI Journal of Bank Mangement, 2008)

This research paper analyzes the quality of ebanking services in the changing

environment.The sample size of bank customers is 25. The data is collected through

pre-tested and well structured questionnaire in Ludhiana, Punjab in May 2006.The

study concludes that the customers of ebanks are satisfied with the different e-

channels and their services. It also suggests some measures to make ebanking service

more effective in the future. The present study is mainly concerned with the Indian

banking industry in general and particularly those banks that are producing service

through e-channels i.e. ebanks.

21) A study on factors affecting efficiency of Public Sector Banks”

N.Rao & Tiwari, (Journal of Service Research, March,2009.)

Here both the authors study the efficiency of 5 public sector banks selected on the

basis of deposits size in 2005. The study concludes that all employee efficiency

factors have insignificant influence on deposits, assets and advances, from branch

efficiency, only operating profits per branch and from operating efficiency, cost of

deposits have significant and positive impact.

Liquidity influencing factors and ultimate profit factors do not influence deposits,

assets and advances significantly although all profit factors have negative effect. The

study also suggests some measures to improve efficiency.

22) The Relationship between service quality and Customer Satisfaction

G.S. Sureshchandar, C.Rajendran & R.N. Anantharaman, (Journal of Service

Marketing, 2002)

The Authors adopt a different approach and view customer satisfaction as a multi

dimensional construct just as service quality, but argues that customer satisfaction

should be operationalized along the same factors on which service quality is

operationalized. Based on this approach, the link between service quality and customer

satisfaction has been investigated. The results indicate that the two constructs are

indeed independent but are closely related, implying that an increase in one is likely to

lead to an increase in another.

23) Paradigm change : Relationship Marketing and Service quality of Banking

Service” Dhillon, Batra & Dhyani, (Indian Banks’ Bulletin,2003)

This research paper study the impact of relationship marketing and trends of customer

relationship in selected Public Sector Banks (SBI) and private sector banks (ICICI) in

Chandigarh. The study concludes that ICICI bank is doing well in credibility, access,

communication, understanding the customers, tangibles, reliability, responsiveness,

competence and courtesy as their mean value is greater than that of SBI but from security

point of view, SBI is better. The study suggests that Public Sector Banks can also improve

their image by relationship marketing and further this relationship marketing will be

helpful in transforming the Indian banking system.

24) Banker – Customer Relationship in India ”

O.D. Heggade,( Journal of Financial Services research, 2002.)

Heggade O.D. analyzes the range of customer services provided by the banks along with

their impact on customer-banker relations. Study deals with Indian banks in general and

banks of Karnataka. 500 bank customers, 50 bank managers and 50 bank officers and

clerks selected through stratified sampling were surveyed through questionnaires and

interviews. The study concludes that public sector banks, although improved but are far

behind their counterparts mainly because they are operating mostly on labor-intensive

basis rather than computerization of their operations and electronic system. The study also

reveals that banking habits of people in this district are good and majority of the

customers are satisfied with banks’ customer services. A modest degree of customers’

shifting between different public sector banks and different public and private sector

banks has been observed. Employees in majority are satisfied with office space and

communication facilities.

25) Indian Banks & ATMs – An empirical study of consumer perception”

Poonam Garg & Vimi Jham, Strategies of Winning Organization, Excell Books

Publication, 2006.

The authors investigate factors that influence Indian customers to adopt ATMs by

using factor analysis and focused on the influence of demographic and psychological

variables of 296 customers of six selected banks such as SBI, PNB, ICICI, HDFC,

IDBI.

It is examined that most of the respondents are below the age of 35 years and the users

with lesser experience face more problems in comparison to other and they look for

reliability of information. There are problems of dim vision of screen and they use

ATMs maximum for withdrawals and rarely for deposits.

3. RESEARCH METHODOLOGY

Objectives of the Study

Expectation of customer towards their banks.

Satisfaction of customer towards their banks.

Perceptions of customer regarding service offered by banks.

Importance of the study

Satisfaction level of customer in banking sector

Identify the changes that customer needs in their banks

Identify potential customer of public and private banking.

Identify Why customer choose particular banking sector

RESEARCH METHODOLOGY

Research Type – Exploratory & Descriptive

o Why exploratory & descriptive research?

The time and budget constraints have been limited this research to go for

exploratory research design.

This research will provide insights and understanding the consumer’s Perception,

Expectation and Satisfaction level of the services provided by banking sector.

Descriptive research is used to describe characteristics of a population who have

bank accounts.

Data collection method:

Primary data

Structured questionnaire

SAMPLING PROCESS & SAMPLE SIZE

1. Population

a. Element: people selected randomly who have bank accounts.

b. Sampling unit: Customers who have bank accounts.

c. Extent: Vallabh Vidyanagar

d. Time: 15 minutes/respondent

2. Sampling Techniques: Random Sampling

3. Sample size: 200

LIMITATIONS

The study will be restricted to only VVN. Hence, the Findings cannot be

generalized for either the entire region or the country as a whole.

Sample size will be limited to 200 respondents.

RESULT ANALYSIS AND INTERPRETATION

1. Expectation of Public and Private Sector Banks:

Analysis of 29 Statements:

Under the caption ‘expectation level’ in the questionnaire, the respondents were asked

to give their opinion on 29 statements pertaining to services provided by Public and

Private Sector Banks. All the 204 respondents (97 for Public Sector and 107 for Private

Sector Banks) had given their opinion on a five point Likert Scale on all these statements.

Following paragraphs give the various statistical analyses carried out on the responses to

these 29 statements.

Factor Analysis

Analysis of multivariate data is very important. Factor analysis is one of the multivariate

analytical techniques. Factor analysis is a generic name denoting a class of procedures

primarily used for data reduction and summarization. When a research is carried out, it

may contain a large number of variables. Most of these variables may be correlated.

Factor analysis reduces a large number of variables to a small number of factors. This

factor conveys all essential information about the original variables.

Determination of the method of Factor Analysis:

To carry out the factor analysis there are about 6 to 7 methods available, out of which, two

methods are generally used: (1) Principal Component Analysis, and (2) Common Factor

Analysis. An appropriate method is to be selected for the analysis. If, however, the number

of variables is large (greater than 15) both methods result in similar solutions. Since, the

number of variables here are 29, either of the two methods can safely be used. From these

two methods, ‘Principal Component Analysis method’ is selected to carry out Factor

Analysis, as is usually done by different analysts.

Appropriateness of Factor Analysis and number of Factors:

Decision for carrying out Factor Analysis is wholly dependent upon answers to following two

questions:

1. Is factor analysis appropriate for the data?, and

2. How many factors should be extracted?

The answer to the first question is given by (1) Bartlett’s test of sphericity and (2) Kaiser-

Meyer-Olkin (KMO) measures of sampling adequacy. Bartlett’s test of sphericity is used to

test the null hypothesis that variables are uncorrelated in the population. The second is an

index to examine the appropriateness of factor analysis. Generally, the values of ‘KMO

measure of sampling adequacy’, falling between 0.5 to1.0 indicate that factor analysis is

appropriate. Values below 0.5 indicate inappropriateness of the analysis.

Many procedures have been suggested to answer the second question. They include (1)

Priori determination, (2) Determination on the basis of Eigen values, (3) Determination on

the basis of Scree Plot etc.

Factor Analysis using ‘Principal Component Analysis’ method:

Factor analysis was carried out on all the responses to 20 statements using ‘Principal

Components Analysis’ method. The results showed the approximate Chi-Square value of

2129.589 at 406 degree of freedom under the Bartlett’s Test of Sphericity, which is

significant at the 0.05 level. The null hypothesis (that the variables are uncorrelated in the

population, or the correlation matrix is an identity matrix) is, therefore, rejected. The alternate

hypothesis that the variables in the population are correlated is accepted. The Kaiser-Meyer-

Olkin Measure of Sampling Adequacy was 0.800. Thus, factor analysis may be considered

appropriate for analyzing the data.

Further analysis, therefore was carried out. In the final results, total eight factors, out of 29

have Eigen values more than 1.00. As per the approach based on Eigen values, only factors

with Eigen values greater than 1.00 are to be retained. Hence, total eight factors are to be

considered in this data. The results also show that these eight factors account for 62.469

percent of the total variance.

An important output from factor analysis is the factor matrix, also called the factor pattern

matrix. The factor matrix contains the coefficients used to express the standardized variables

in terms of the factors. These coefficients, factor loadings, represent the correlation between

the factors and the variables. A coefficient with a large absolute variable indicates that the

factor and the variable are closely related. Hence, to facilitate interpretation of factors, it is

necessary to identify the variables that have large loadings on the same factor. In the factor

matrix, the highest loading of 0.671 was found for statement one on factor ‘1’. It was decided

to consider factor loading of 0.500 as a cut off point for a statement to be associated with a

factor. When cut off value of loading of 0.500 was considered; seventeen statements were

associated with factor ‘1’, eight statements was associated with factor ‘2’ and there

statements were associated with factor ‘4’, ‘5’ and ‘6’, zero statements were associated with

factor ‘3’, ‘7’ and ‘8’.

Although, the initial or un-rotated factor matrix indicates the relationship between the factors

and individual variables, it rarely results in factors that can be interpreted, because the factors

are correlated with many variables. The factor matrix, therefore, is transformed into a simpler

one through rotation. It is easier to interpret this rotated factor matrix. Again, many methods

are available for rotation. Most commonly used method for rotation is the ‘Varimax’

procedure. Other two popular methods are ‘direct oblimin’ and ‘quartimax’.

Table 4.5 represents Factor Matrix without rotation and Table 4.6 represents Factor Matrix

with Varimax rotation. These two tables are representing the factor loadings. These factor

loadings represent the correlation between the factors and the variables. Analysis based on

these tables is given after these two tables.

Factor Matrix without rotation

Component Matrixa Statements Component

1 2 3 4 5 6 7 8

1 Good .580 .017 -.480 .268 .009 -.011 .048 .228

2 on time .623 .051 -.464 .054 -.003 -.132 -.215 .179

3 Easy .598 .121 -.420 .033 -.060 -.173 -.215 -.137

4 Queries .575 .049 -.142 .197 -.274 -.347 .028 -.127

5 Queue .657 -.023 -.416 .208 .067 .138 .085 .049

6 treat .671 .046 -.217 -.176 .097 .114 .030 .034

7 clean .658 -.131 -.054 -.073 .076 .195 .170 -.116

8 well ma .638 -.056 .004 -.060 .086 .313 .237 -.345

9 upto date .461 .116 -.011 -.061 .141 .479 -.039 .029

10 appealing .623 .036 .046 .012 .014 .279 -.004 -.413

11 promise .486 .045 .250 -.073 .198 -.091 -.403 -.204

12 depend .439 -.104 .385 .438 -.268 .167 -.227 -.016

13 attention .431 -.072 .471 .486 -.139 -.199 -.065 -.027

14 records .527 -.084 .384 .229 .000 .183 .112 .430

15 polite .626 -.074 .307 -.018 -.115 -.113 .363 .025

16 trust .571 -.067 .150 -.216 -.236 -.290 .356 -.136

17 available .544 .004 .067 -.441 .078 -.220 .307 .278

18 safe .542 .025 .249 -.255 .234 -.021 -.128 .456

19 support .569 .011 .339 -.135 .198 -.164 -.311 .014

20 assist .647 -.040 .001 -.121 .053 -.175 -.227 -.131

21 well man -.020 .655 -.056 .058 .160 -.196 .167 -.062

22 no busy -.003 .666 .115 .075 .348 .011 .049 -.101

23 minimal -.013 .627 .017 .155 .194 -.326 -.070 -.058

24 loyalty -.098 .481 .182 .205 .510 .057 .191 -.057

25 ecomm .042 .698 -.036 .138 -.208 -.140 .203 .043

26 etrans .032 .554 .008 .192 -.269 .290 .141 .086

27 informed .071 .534 -.089 .005 -.184 .204 -.222 .299

28 new card .056 .623 .081 -.384 -.242 .162 -.219 -.055

29 clearance .056 .479 .168 -.362 -.463 .075 -.070 -.059

Extraction Method: Principal Component Analysis.

Factor Matrix with Varimax rotation

Rotated Component Matrix Statements Component

1 2 3 4 5 6 7 8

1 Good .772 .178 .026 .050 -.088 .109 -.106 .175

2 on time .792 .090 -.036 .045 .049 .004 .198 .153

3 Easy .703 .173 .030 .115 .101 .004 .289 -.126

4 Queries .541 .037 .027 .407 .047 .301 .143 -.172

5 Queue .679 .421 .007 .065 -.105 .098 -.048 .124

6 treat .466 .438 -.018 .202 .074 -.076 .186 .246

7 clean .290 .573 -.094 .273 -.075 .076 .121 .155

8 well ma .170 .756 -.009 .271 -.041 .088 .108 .000

9 upto date .167 .569 .021 -.115 .156 .055 .080 .288

10 appealing .193 .677 .014 .143 .080 .199 .257 -.108

11 promise .105 .216 .071 .030 .032 .189 .673 .063

12 depend .089 .202 -.149 -.029 .083 .767 .159 .045

13 attention .070 .007 .066 .216 -.114 .771 .218 .030

14 records .092 .213 -.041 .150 -.032 .538 -.020 .589

15 polite .102 .283 -.005 .623 -.030 .331 .072 .238

16 trust .154 .192 -.070 .765 .050 .117 .135 .020

17 available .191 .118 -.001 .612 .036 -.174 .157 .490

18 safe .152 .096 .001 .165 .066 .066 .374 .702

19 support .110 .140 .046 .172 .020 .216 .651 .293

20 assist .372 .225 -.052 .241 .019 .103 .521 .064

21 well man .081 -.066 .677 .090 .193 -.106 -.046 -.058

22 no busy -.073 .110 .729 -.096 .167 -.043 .083 .043

23 minimal .113 -.208 .678 -.009 .152 .017 .156 -.082

24 loyalty -.194 .132 .720 -.135 -.111 .002 -.036 .112

25 ecomm .158 -.113 .545 .173 .431 .099 -.224 -.070

26 etrans .061 .133 .318 -.072 .484 .207 -.352 .018

27 informed .210 -.047 .200 -.239 .563 .055 -.076 .208

28 new card -.059 .082 .199 -.017 .762 -.142 .173 .007

29 clearance -.114 .015 .047 .196 .747 -.021 .062 -.055


Rotation Method: Varimax with Kaiser Normalization.

As discussed earlier, a coefficient with a large absolute variable indicates that the factor and

the variable are closely related. Hence, to facilitate interpretation of factors, it is necessary

to identify the variables that have large loadings on the same factor. It was decided that

loading of absolute value of 0.500 should be considered as a cut off point for a statement to

be associated with a factor. Factor matrices of the five factors obtained under above

referred two different methods were referred to, and a cut off value of loading of 0.500 was

finally considered. Following table shows the number of statements associated with

different five factors under two different methods:

Sr.

No

Rotation

Method

Factors

1 2 3 4 5 6 7 8

1 Without

rotation

1,2,3,4,5,6,7,8,

10,12,14,15,16

,17,18,19,20,

21,22,23,

25,26,27,

28,29

- 13 11 9 - -

2 Varimax

rotation

1,2,3,4,5,6 7,8,9,10 21,22,23

, 24,25

16,17 27,28,29 12,13 11,19,

20

14,18

As discussed earlier, although, the initial or un-rotated factor matrix indicates the

relationship between the factors and individual variables, it seldom results in factors that

can be interpreted, because the factors are correlated with many variables. The factor

matrix, therefore, is transformed into a simpler one through rotation. It is easier to interpret

this rotated factor matrix. It can also be seen that from the above table that more variables

get associated with the factors when the factor matrix is rotated. All the two rotation

methods are giving the same variables associated with each matrix. So, the results of this

method are considered for interpretations of factors.

Interpretation of Factors:

Factor Number 1: Statements number 1, 2, 3, 4, 5, 6 are associated with this factor. These statements are

extracted from the Questionnaire and reproduced below:

Statement Number 1: Services provided should be good.

Statement Number 2: Services should be provided on time.

Statement Number 3: Services should be easy to use.

Statement Number 4: Your bank should be always ready to help you in any

queries.

Statement Number 5: Queue management should be better.

Statement Number 6: Your bank should treat you well.

The six statements stated above reflect dimensions, of ‘Service Quality’. The data can be

summarized by stating that ‘the customers’ satisfaction depends on the services they get

from the banks.’

Factor Number 2

Statements number 7, 8, 9 and 10 are associated with this factor. These statements are


Statement Number 7: Employees should be neat and clean.

Statement Number 8: Employees should be well mannered.

Statement Number 9: Your bank should have up to date equipments.

Statement Number 10: Their physical facilities should be visually appealing.

The four statements stated above reflect the dimension, of ‘bank equipments and

employees quality’. The data, therefore, can again be summarized by stating that ‘the

customers’ satisfaction is associated with well and clean dressed employees, well mannered

employees, up-to-date equipments and appealing physical facilities be given to the

customers’.

Factor Number 3

Statements number 21, 22, 23, 24, 25 are associated with this factor. These statements are


Statement Number 21: These facilities of online and phone assistance should be well

managed.

Statement Number 22: Telephones should not be busy.

Statement Number 23: Transactions carried out should take minimal time.

Statement Number 24: Loyalty discounts should be provided.

Statement Number 25: E-commerce facilities should be provided.

The five statements stated above reflect dimension of ‘Quality of Online and Phone

Services’. The data, therefore, can again be summarized by stating that ‘the customers’

satisfaction appears to associate with the quality of the service provided by banks related to

phone and online facilities’.

Factor Number 4

Statements number 16 and 17 are associated with this factor. These statements are


Statement Number 16: Customers should be able to trust employees of these firms.

Statement Number 17: These firms should have flexible timing and should always be

available for the customers.

The two statements stated above reflect the ‘Employees Dedication towards the

Customers’. The data, therefore, can again be summarized by stating that ‘the customers’

satisfaction is associated with the trust and timings issues’.

Factor Number 5

Statements number 27, 28 and 29 are associated with this factor. These statements are


Statement Number 27: Customers should be informed about every transaction on paper.

Statement Number 28: Customers should be provided new credit/debit card well in

advance before their current card expires as well as check books.

Statement Number 29: Check clearance should take minimal time.

The three statements stated above reflect the dimension of ‘extra activities’ that are

provided to lure the customers. The data, therefore, can again be summarized by stating

that ‘the customers’ satisfaction is associated with extra things available while customers

are banking with their banks’.

Factor Number 6



Statement Number 12: These firms should be dependable.

Statement Number 13: Your bank should give you individual attention.

The two statements stated above reflect the dimension of ‘dependability of the customers

towards the banks’. The data, therefore, can again be summarized by stating that ‘the

customers’ satisfaction is associated with dependability on the banks and individual

attention given by the banks to their customers’.

Factor Number 7

Statements number 11, 19 and 20 are associated with this factor. These statements are


Statement Number 11: When these firms promise to do something by a certain time, they

should do so.

Statement Number 19: Their employees should get adequate support from these firms to

do their jobs well.

Statement Number 20: Phone and online assistance should be provided by these firms.

The three statements stated above reflect the dimension of ‘Employees Duty for their


satisfaction is associated with doing the promised job on time, providing adequate support

and providing phone and online assistance to the customers’.

Factor Number 8



Statement Number 14: Customers should be able to feel safe in their transactions with

these firms’ employees.

Statement Number 18: They should keep their records accurately.

The two statements stated above reflect the dimension of ‘Safety Measures taken by the

banks’. The data, therefore, can again be summarized by stating that ‘the customers’

satisfaction is associated with Safety issues and keeping the records accurately’.

Sr. No. Factor Name on the basis of Inference

1 Factor 1 Service Quality

2 Factor 2 Bank equipments and employees quality

3 Factor 3 Quality of Online and Phone Services

4 Factor 4 Employees Dedication towards the Customers

5 Factor 5 Extra Activities to lure customers

6 Factor 6 Dependability of the customers towards the banks

7 Factor 7 Employees Duty for their Customers

8 Factor 8 Safety Measures

Public Sector Banks (Satisfaction)

Analysis of 29 statements:

Under the caption ‘satisfaction level’ in the questionnaire, the respondents were asked to

give their opinion on 29 statements pertaining to services provided by Public Sector Banks.

All the 97 respondents had given their opinion on a five point Likert Scale on all these

statements. Following paragraphs give the various statistical analyses carried out on the

responses to these 29 statements.

Factor Analysis:



primarily used for data reduction and summarization. When a research is carried out, it may

contain a large number of variables. Most of these variables may be correlated. Factor

analysis reduces a large number of variables to a small number of factors. This factor conveys

all essential information about the original variables.




Analysis. An appropriate method is to be selected for the analysis. If, however, the number of

variables is large (greater than 15) both methods result in similar solutions. Since, the number

of variables here are 29, either of the two methods can safely be used. From these two

methods, ‘Principal Component Analysis method’ is selected to carry out Factor Analysis, as

is usually done by different analysts.



questions:









Many procedures have been suggested to answer the second question. They include (1) Priori

determination, (2) Determination on the basis of Eigen values, (3) Determination on the basis

of Scree Plot etc.












with Eigen values greater than 1.00 are to be retained. Hence, total nine factors are to be









matrix, the highest loading of 0.779 was found for statement two on factor ‘15’. It was

decided to consider factor loading of 0.500 as a cut off point for a statement to be associated

with a factor. When ‘factor matrix’ of the above one factor was referred to, and a cut off

value of loading of 0.500 was considered; eleven statements were associated with factor ‘1’,

five statements were associated with factor ‘2’ and four statements were associated with

factor ‘3’ and two statements were associated with factor ‘4’ and ‘5’, three statements were

associated with factor ‘6’ and ‘7’, three statements were associated with factor ‘8’ and ‘9’.












1 2 3 4 5 6 7 8

1 Good .618 .061 .057 -.252 .429 -.040 -.033 .010

2 on time .511 -.035 -.017 -.121 -.441 -.094 .252 .157

3 Easy .242 -.141 -.030 .276 .339 .314 .460 -.013

4 Queries .381 .125 -.102 .293 -.229 -.042 -.439 -.387

5 Queue .212 4.116E-5 .221 -.218 .320 -.058 -.405 .549

6 treat .726 -.034 .022 .120 -.188 .012 .265 -.143

7 clean .883 .064 .045 -.038 -.054 .063 -.067 -.116

8 well ma .427 -.138 -.044 .539 .185 .264 -.073 .188

9 upto date -.127 .117 .708 .180 .010 .110 -.045 -.022

10 appealing -.191 .043 .735 .087 -.013 .197 .134 .007

11 promise -.047 .065 .823 .109 -.169 -.053 .046 -.018

12 depend .716 .072 .029 .103 -.249 -.071 -.257 -.051

13 attention .427 .082 .062 -.597 .193 -.131 .298 -.181

14 records .681 -.153 .136 .066 .260 .188 -.218 -.010

15 polite .779 -.008 -.019 -.058 .148 .043 -.076 -.186

16 trust .336 .032 -.156 .547 -.254 -.181 .172 .294

17 available .684 .139 -.047 -.244 -.010 -.080 .139 .310

18 safe .770 -.007 .170 .004 -.031 .065 -.197 .005

19 support .770 .087 .094 -.067 -.142 -.072 .284 -.010

20 assist -.060 .489 .177 -.201 -.070 -.189 -.158 -.179

21 well man .022 .607 .045 -.015 -.244 -.319 -.058 .273

22 no busy -.084 .533 .077 -.023 .075 -.101 .014 .071

23 minimal .015 .558 -.030 .256 .307 -.444 .027 -.044

24 loyalty .024 .577 .038 .378 .267 -.213 .216 -.004

25 ecomm -.003 .656 -.062 .119 .182 .013 .015 -.275

26 etrans .047 .704 -.206 .057 .105 .247 -.015 .144

27 informed -.012 .609 -.259 .004 -.073 .353 -.085 .012

28 new card -.017 .574 -.060 -.220 -.290 .539 .004 .144

29 clearance -.164 .603 .107 -.165 -.053 .224 .091 -.089


Rotated Component Matrixa Statements Component

1 2 3 4 5 6 7 8

1 Good .614 -.057 .169 -.102 .134 -.299 -.085 .323

2 on time .561 .020 -.190 -.045 -.157 .379 -.169 -.138

3 Easy .183 -.018 .063 .025 .697 -.006 -.192 -.142

4 Queries .307 .023 .082 -.076 -.097 .050 .720 -.128

5 Queue .149 -.029 -.011 .068 -.063 -.030 -.069 .821

6 treat .730 -.049 -.014 .010 .171 .197 .057 -.249

7 clean .865 .052 -.012 -.034 .084 .009 .221 .052

8 well ma .240 -.025 .016 .008 .610 .281 .294 .207

9 upto date -.074 .021 .086 .743 .019 -.042 .074 .074

10 appealing -.102 .043 -.024 .780 .067 -.063 -.116 -.007

11 promise .056 -.095 .040 .830 -.153 .060 -.012 -.008

12 depend .668 .009 -.017 -.020 -.094 .207 .399 .079

13 attention .579 -.029 .071 -.097 -.159 -.416 -.416 -.058

14 records .592 -.086 -.074 .047 .337 -.129 .259 .311

15 polite .749 -.044 .038 -.117 .166 -.155 .200 .076

16 trust .219 -.081 .169 -.081 .186 .716 .103 -.060

17 available .696 .104 .039 -.156 -.036 .172 -.245 .243

18 safe .731 -.003 -.066 .085 .073 .040 .258 .215

19 support .814 .005 .055 .031 .034 .166 -.113 -.106

20 assist .043 .219 .315 .150 -.452 -.178 .076 -.013

21 well man .067 .296 .404 .050 -.463 .343 -.052 .132

22 no busy -.040 .295 .420 .093 -.180 .003 -.079 .077

23 minimal -.002 .001 .810 -.042 -.085 .050 .047 .050

24 loyalty .005 .144 .756 .095 .129 .140 -.026 -.055

25 ecomm .022 .386 .578 -8.251E-5 -.014 -.174 .146 -.148

26 etrans .022 .667 .396 -.121 .063 .049 .020 .111

27 informed -.023 .707 .190 -.147 -.003 .007 .131 -.023

28 new card .045 .865 -.093 .056 -.106 .037 -.059 -.014

29 clearance -.060 .576 .235 .181 -.163 -.156 -.101 -.118











Sr.

No

Rotation

Method

Factors

1 2 3 4 5 6 7 8

1 Without

rotation

1,2,4,6,7,12,13,

14,15,17,18,19

20,21,22,

23,24,25,

26,27,28,29

9,10,11 8 3 9 - 5

2 Varimax

rotation

1,2,6,7,12,13,14

,15,17,18,19

26,27,28,29 23,24,25 9,10,

11

3,8 16,21 4,20 5,22










Factor Number 1: Statements number 1, 2, 6, 7, 12, 13, 14, 15, 17, 18 and 19 are associated with this factor.

These statements are extracted from the Questionnaire and reproduced below:

Statement Number 1: Services provided are good.

Statement Number 2: Services are provided on time.

Statement Number 6: Your bank treats you well.

Statement Number 7: Employees are neat and clean.

Statement Number 12: These firms are dependable.

Statement Number 13: Your bank gives you individual attention.

Statement Number 14: They keep their records accurately.

Statement Number 15: Employees of your bank are polite.

Statement Number 17: These firms are having flexible timings and should always

be available for the customers.

Statement Number 18: Customers feel safe in their transactions with these firms’

employees.

Statement Number 19: Employees get adequate support from these firms to do

their jobs well.

The eleven statements stated above reflect dimensions, of ‘Service Quality’. The data can be


from the banks.’

Factor Number 2



Statement Number 26: E-transactions are safe enough.

Statement Number 27: Customers are always informed about every transaction on

paper.

Statement Number 28: Customers are provided new credit/debit card well in advance

before their current card expires as well as check books.

Statement Number 29: Check clearance takes minimal time.

The four statements stated above reflect the dimension, of ‘Bank’s Concern for their


satisfaction is associated with parameters that are attracting more customers like safe E-

transactions, taking minimal time for check clearance, providing check books, credit/debit

card which shows that bank takes care of their customers’.

Factor Number 3

Statements number 23, 24, 25 are associated with this factor. These statements are


Statement Number 23: Transactions carried out are taking minimal time.

Statement Number 24: Loyalty discounts are provided.

Statement Number 25: E-commerce facilities are provided.

The three statements stated above reflect dimension of ‘Extra Activities to attract


satisfaction appears to associate with the minimal time transactions, Loyalty discounts and

E-commerce Facilities’.

Factor Number 4

Statements number 9, 10, 11 are associated with this factor. These statements are extracted

from the Questionnaire and reproduced below:

Statement Number 9: Your bank has up to date equipments.

Statement Number 10: Their physical facilities are visually appealing.

Statement Number 11: Your bank provides its services at the time it promises to do so.

The three statements stated above reflect the ‘Bank Facilities’. The data, therefore, can

again be summarized by stating that ‘the customers’ satisfaction is associated with the

Equipments used and promises made’.

Factor Number 5

Statements number 3 and 8 are associated with this factor. These statements are extracted


Statement Number 3: Customers Services are easy to use.

Statement Number 8: Employees are well mannered.

The two statements stated above reflect the dimension of ‘Attractive Services’ that are


that ‘the customers’ satisfaction is associated with attractive things available while

customers are banking with their banks’.

Factor Number 6



Statement Number 16: You can trust the employees of your bank.

Statement Number 21: These facilities of online and phone assistance are very well managed.

The two statements stated above reflect the dimension of ‘dependability of the customers

towards the banks’. The data, therefore, can again be summarized by stating that ‘the

customers’ satisfaction is associated with dependability on the trust towards the employees

of the banks and well managed online and phone services.’

Factor Number 7



Statement Number 4: Your bank is always ready to help you in any queries.

Statement Number 20: Phone and online assistance is provided by these firms.

The two statements stated above reflect the dimension of ‘Bank’s Assistance for any query’.

The data, therefore, can again be summarized by stating that ‘the customers’ satisfaction is

associated with solving the queries every time and providing phone and online assistance’.

Factor Number 8



Statement Number 5: Queue management is better.

Statement Number 22: Telephones are not always busy.

The two statements stated above reflect the dimension of ‘Value of Time’. The data,

therefore, can again be summarized by stating that ‘the customers’ satisfaction is associated

with better Queue Management and keeping telephone line open for customers’.



2 Factor 2 Bank’s Concern for their Customers

3 Factor 3 Extra Activities to attract Customers

4 Factor 4 Bank Facilities

5 Factor 5 Attractive Services

6 Factor 6 Dependability of the customers towards the banks

7 Factor 7 Bank’s Assistance for any query

8 Factor 8 Value of Time

Private Sector Banks (Satisfaction)

Analysis of 29 statements:

Under the caption ‘satisfaction level’ in the questionnaire, the respondents were asked to

give their opinion on 29 statements pertaining to services provided by Private Sector Banks.

All the 107 respondents had given their opinion on a five point Likert Scale on all these

statements. Following paragraphs give the various statistical analyses carried out on the

responses to these 29 statements.

Factor Analysis:



primarily used for data reduction and summarization. When a research is carried out, it may

contain a large number of variables. Most of these variables may be correlated. Factor

analysis reduces a large number of variables to a small number of factors. This factor conveys

all essential information about the original variables.




Analysis. An appropriate method is to be selected for the analysis. If, however, the number of

variables is large (greater than 15) both methods result in similar solutions. Since, the number

of variables here are 29, either of the two methods can safely be used. From these two

methods, ‘Principal Component Analysis method’ is selected to carry out Factor Analysis, as

is usually done by different analysts.



questions:









Many procedures have been suggested to answer the second question. They include (1) Priori

determination, (2) Determination on the basis of Eigen values, (3) Determination on the basis

of Scree Plot etc.












with Eigen values greater than 1.00 are to be retained. Hence, total nine factors are to be









matrix, the highest loading of 0.779 was found for statement two on factor ‘15’. It was

decided to consider factor loading of 0.500 as a cut off point for a statement to be associated

with a factor. When ‘factor matrix’ of the above one factor was referred to, and a cut off

value of loading of 0.500 was considered; eleven statements were associated with factor ‘1’,

five statements were associated with factor ‘2’ and four statements were associated with

factor ‘3’ and two statements were associated with factor ‘4’ and ‘5’, three statements were

associated with factor ‘6’ and ‘7’, three statements were associated with factor ‘8’ and ‘9’.












1 2 3 4 5 6 7 8

1 Good .246 -.187 -.230 .266 .452 .353 -.248 .151

2 on time .399 .199 -.089 .204 .088 -.230 .506 .362

3 Easy .208 .131 .166 -.226 .400 -.088 .284 -.611

4 Queries .739 -.003 -.070 .133 -.206 .117 -.190 .046

5 Queue .864 .070 -.024 .024 -.089 -.054 .080 .059

6 treat .418 -.159 -.172 .568 .294 .025 -.070 -.232

7 clean .694 .139 .054 .265 -.227 -.097 .265 -.029

8 well ma .479 .101 .007 -.675 -5.032E-5 .179 -.158 .137

9 Up to date -.115 .143 .501 .082 .274 -.325 -.064 .368

10 appealing -.106 .057 .661 .180 .073 -.071 .037 .234

11 promise .774 .065 .163 .082 -.062 -.120 .079 -.111

12 depend .797 .067 .000 -.021 -.142 .252 -.034 .060

13 attention .803 .076 .027 -.145 .025 .183 .054 .182

14 records -.128 .261 .095 -.036 -.315 .284 .518 -.241

15 polite .277 -.072 -.097 -.165 .656 -.030 .335 .016

16 trust .387 -.091 -.031 .656 -.055 .026 -.184 -.106

17 available .637 .176 .155 -.215 -.211 .128 .053 .047

18 safe .589 -.060 .075 -.321 .266 -.019 -.322 -.138

19 support .456 .032 .063 -.125 .289 -.462 -.108 .030

20 assist -.202 -.181 -.332 .049 .312 .512 .314 .293

21 well man -.138 .078 .624 .075 .136 .394 -.067 -.094

22 no busy .002 .101 .704 .139 .092 .359 -.048 -.044

23 minimal -.047 .734 -.127 -.033 .269 .051 -.065 -.098

24 loyalty -.227 .747 -.071 .132 .104 -.057 -.062 .047

25 ecomm -.052 .722 -.019 .144 .041 -.120 .004 -.030

26 etrans .019 .627 -.069 .141 .008 .066 -.024 -.196

27 informed -.129 .749 -.192 -.017 .144 .181 -.127 .051

28 new card -.108 .692 .008 -.035 -.060 .059 .058 .228

29 clearance .052 .626 -.160 -.028 -.167 -.045 -.235 -.008


Rotated Component Matrixa Statements Component

1 2 3 4 5 6 7 8

1 Good .140 -.045 .378 .010 -.010 .604 .290 -.138

2 on time .318 .117 .081 -.095 .061 .103 -.014 .742

3 Easy .093 .068 .012 .067 .846 -.125 -.087 -.062

4 Queries .731 -.033 .292 -.091 -.149 -.018 .081 -.062

5 Queue .816 -.020 .181 -.114 .093 -.060 .083 .204

6 treat .186 -.068 .757 -.068 .192 .169 .125 .028

7 clean .643 .026 .321 -.034 .050 -.194 -.165 .348

8 well ma .618 .028 -.516 -.073 .105 .104 .194 -.240

9 upto date -.152 .096 -.115 .493 -.030 -.125 .419 .362

10 appealing -.080 -.030 -.031 .664 -.084 -.141 .097 .255

11 promise .702 -.042 .245 .042 .206 -.213 .056 .165

12 depend .837 -.003 .132 -.011 -.021 .091 -.022 -.033

13 attention .828 -.008 -.015 .010 .084 .175 .093 .102

14 records .017 .151 -.138 .087 .108 -.067 -.728 .072

15 polite .122 -.068 -.044 -.057 .595 .406 .209 .273

16 trust .248 -.038 .739 .043 -.152 -.034 .045 .019

17 available .732 .050 -.125 .066 .034 -.093 -.071 .016

18 safe .528 -.071 -.025 -.003 .327 -.003 .429 -.278

19 support .303 .000 .025 -.073 .302 -.191 .522 .200

20 assist -.179 -.092 -.052 -.076 -.030 .791 -.206 .107

21 well man -.043 .034 -.002 .728 .074 .068 -.131 -.216

22 no busy .091 .028 .051 .789 .044 .014 -.116 -.128

23 minimal -.015 .770 -.038 .002 .210 .080 .041 -.036

24 loyalty -.177 .778 -.008 .056 -.034 -.035 .009 .103

25 ecomm -.023 .714 .049 .047 .038 -.147 -.028 .152

26 etrans .057 .634 .134 .017 .089 -.079 -.149 -.042

27 informed -.029 .802 -.090 -.011 -.020 .170 -.012 -.078

28 new card .034 .657 -.226 .101 -.146 .011 -.098 .170

29 clearance .143 .635 -.043 -.130 -.148 -.176 .028 -.099











Sr.

No

Rotation

Method

Factors

1 2 3 4 5 6 7 8

1 Without

rotation

4,5,7,8,11,12,13

,17,18,19

23,24,25,

26,27,28,29

9,10,21,

22

6,16 1,3,15 20 2,14 -

2 Varimax

rotation

4,5,7,8,11,12,13

,17

23,24,25,

26,27,28,29

6,16 9,10,

21,22

3,15 1,20 18,19 2,14










Factor Number 1: Statements number 4, 5, 7, 8, 11, 12, 13 and 17 are associated with this factor. These

statements are extracted from the Questionnaire and reproduced below:

Statement Number 4: Your bank is always ready to help you in any queries.

Statement Number 5: Queue management is better.

Statement Number 7: Employees are neat and clean.

Statement Number 8: Employees are well mannered.

Statement Number 11: Your bank provides its services at the time it

promises to do so.

Statement Number 12: These firms are dependable.

Statement Number 13: Your bank gives you individual attention.

Statement Number 17: These firms are having flexible timings and should always

be available for the customers.

The eight statements stated above reflect dimensions, of ‘Service Quality’. The data can be


from the banks.’

Factor Number 2

Statements number 23, 24, 25, 26, 27, 28 and 29 are associated with this factor. These

statements are extracted from the Questionnaire and reproduced below:

Statement Number 23: Transactions carried out are taking minimal time.

Statement Number 24: Loyalty discounts are provided.

Statement Number 25: E-commerce facilities are provided.

Statement Number 26: E-transactions are safe enough.

Statement Number 27: Customers are always informed about every transaction on

paper.

Statement Number 28: Customers are provided new credit/debit card well in advance

before their current card expires as well as check books.

Statement Number 29: Check clearance takes minimal time.

The seven statements stated above reflect the dimension, of ‘Private Sector Bank’s

Advantages’. The data, therefore, can again be summarized by stating that ‘the customers’

satisfaction is associated with parameters that are attracting more customers like safe E-

transactions, loyalty discounts, E-commerce Facilities, taking minimal time for check

clearance, providing check books, credit/debit card which shows that bank takes care of

their customers’.

Factor Number 3



Statement Number 6: Your bank treats you well.

Statement Number 16: You can trust the employees of your bank.

The two statements stated above reflect dimension of ‘Better Treatment for the customers’.

The data, therefore, can again be summarized by stating that ‘the customers’ satisfaction

appears to associate with the treatment the banks give to their customers and they can

trust their employees.

Factor Number 4



Statement Number 9: Your bank has up to date equipments.

Statement Number 10: Their physical facilities are visually appealing.

Statement Number 21: These facilities of online and phone assistance are very well

managed.

Statement Number 22: Telephones are not always busy.

The four statements stated above reflect the ‘Bank Facilities’. The data, therefore, can again

be summarized by stating that ‘the customers’ satisfaction is associated with the

Equipments used, physical facilities provided and well managed online and phone

assistance’.

Factor Number 5



Statement Number 3: Customers Services are easy to use.

Statement Number 15: Employees of your bank are polite.

The two statements stated above reflect the dimension of ‘Attractive Services’ that are


that ‘the customers’ satisfaction is associated with attractive things available while

customers are banking with their banks’.

Factor Number 6



Statement Number 1: Services provided are good.

Statement Number 20: Phone and online assistance is provided by these firms.

The two statements stated above reflect the dimension of ‘Better Services’. The data,

therefore, can again be summarized by stating that ‘the customers’ satisfaction is associated

with better banking and online and phone services.’

Factor Number 7



Statement Number 18: Your Customers feel safe in their transactions with these firms’

employees.

Statement Number 19: Employees get adequate support from these firms to do their jobs

well.

The two statements stated above reflect the dimension of ‘Employees Dedication’. The

data, therefore, can again be summarized by stating that ‘the customers’ satisfaction is

associated with customers feeling safe in their transactions with their banks and employees

getting all the support to help their customers from the banks’.

Factor Number 8



Statement Number 2: Services are provided on time.

Statement Number 14: They keep their records accurately.

The two statements stated above reflect the dimension of ‘Value of Customers’ Time and

Records’. The data, therefore, can again be summarized by stating that ‘the customers’

satisfaction is associated with serving the customers on time and keeping the records

accurately’.



2 Factor 2 Private Sector Banks’ advantages

3 Factor 3 Better Treatment for the Customers

4 Factor 4 Bank Facilities

5 Factor 5 Attractive Services

6 Factor 6 Better Services

7 Factor 7 Employees Dedication

8 Factor 8 Value of Customers’ Time and Records

GAP ANALYSIS

1. Services provided are good.

Public Sector Bank = -0.14706 Private Sector Bank = -0.44118

As we can say that both Public and Private Sector Banks are not satisfying their

customers fully of this statement. Still Public Sectors are doing better than Private

Sectors in this factor.

2. Services are provided on time

Public Sector Bank = 0 Private Sector Bank = -0.56373

As we can see that in Public Sector is more satisfying its customer than Private Sector Banks in

this factor.

3. Services are easy to use.


Here in this statement neither of the two sectors is satisfying its customer, but here Public

Sector is better than Private Sector Banks.

4. Your bank is always ready to help you in any queries.


Here as we can see neither of the sectors is satisfying the customers, but here Private Sector is

somewhat better than Public Sector Banks.

5. Queue management is better.


Here as we can see neither of the sectors is satisfying the customers, but here Private Sector is

somewhat better than Public Sector Banks.

6. Your bank treats you well.


Here in this statement neither of the two sectors is satisfying its customer, but here Public

Sector is better than Private Sector Banks.

7. Employees are neat and clean.

Public Sector Bank = 0.004902 Private Sector Bank = 0.014706

Here both the sectors are satisfying its customer to some level and out of them, Private Sector is

better than Public Sector Banks.

8. Employees are well mannered.

Public Sector Bank = -1.26471 Private Sector Bank = 0.897059

Here as we can see, Private Sector Banks are satisfying its customers to a high extent while

Public Sector Banks needs to improve a lot in this area.

9. Your bank has up to date equipments.


Here as we can see, both the sectors are satisfying the customers while here Private

Sector is better satisfying its customers than Public Sector.

10. Their physical facilities are visually appealing.


Here Private Sector Banks are satisfying its customers while Public Sector Banks cannot

satisfy their customers in this statement.

11. Your bank provides its services at the time it promises to do so.

Public Sector Bank = 0.196078 Private Sector Bank = -0.45098

Here Public Sector Bank is satisfying its customer while Private Sector Bank is not.

12. These firms are dependable.


Here none of the sector is able to satisfy its customers while people still have more faith

on Public Sector Banks than Private Sector Banks.

13. Your bank gives you individual attention.


Here Private Sector Banks are able to satisfy their customers while Public Sector Banks

are not able to.

14. They keep their records accurately.


Here Private Sector Banks are able to satisfy their customers while Public Sector Banks

are not able to.

15. Employees of your bank are polite.


Here none of the sector is able to satisfy its customers while Private Sector is better in

this factor than Public Sector Banks.

16. You can trust the employees of your bank.


Here none of the sector is able to satisfy its customers while Private Sector is better than

Public Sector in this factor.

17. These firms are having flexible timings and should always be available for the

customers.




18. Customers feel safe in their transactions with these firms’ employees.


Here Private Sector is better than Public Sector Banks in this factor.

19. Employees get adequate support from these firms to do their jobs well.


Here none of the sector is able to satisfy its customers while Public Sector is better than

Private Sector Banks.

20. Phone and online assistance is provided by these firms.


Here Private Sector is far much better than Public Sector Bank in satisfying its customer

related to the phone and online assistance.

21. These facilities of online and phone assistance are very well managed.




22. Telephones are not always busy.


Here both the sectors are satisfying its customers while Private Sector Banks are far

much better than Public Sector Banks in this context.

23. Transactions carried out are taking minimal time.




24. Loyalty discounts are provided.


Here both the sectors are satisfying its customers while Public Sector Banks are far much

better than Private Sector Banks in this context.

25. E-commerce facilities are provided.


Here none of the sector is satisfying its customers while Public Sector is better than

Private Sector banks.

26. E-transactions are safe enough.


Here both the sectors are satisfying its customers while Public Sector Banks are far much

better than Private Sector Banks in this context.

27. Customers are always informed about every transaction on paper.




28. Customers are provided new credit/debit card well in advance before their current

card expires as well as check books.




29. Check clearance takes minimal time.


Here both the sectors are satisfying its customers while Private Sector Banks are better

than Public Sector Banks in this context.

Statements Public Sector Satisfying

Private Sector Satisfying

Which is Better?

1 Services provided are good No No Public

2 Services are provided on time Neutral No Public

3 Services are easy to use No No Public

4 Your bank is always ready to help you in any queries No No Private

5 Queue management is better No No Private

6 Your bank treats you well No No Public

7 Employees are neat and clean Yes Yes Private

8 Employees are well mannered No Yes Private

9 Your bank have up to date equipments Yes Yes Private

10 Their physical facilities are visually appealing No Yes Private

11 Your bank provides its services at the time it promises to do so Yes No Public

12 These firms are dependable No No Public

13 Your bank gives you individual attention No Yes Private

14 They keep their records accurately No Yes Private

15 Employees of your bank are polite No No Private

16 You can trust the employees of your bank No No Private

17 These firms are having flexible timings and should always be available for the customers

No No Private

18 Customers feel safe in their transactions with these firms’ employees

No Yes Private

19 Employees get adequate support from these firms to do their jobs well

No No Public

20 Phone and online assistance is provided by these firms No Yes Private

21 These facilities of online and phone assistance are very well managed

No No Private

22 Telephones are not always busy Yes Yes Private

23 Transactions carried out are taking minimal time Yes Yes Private

24 Loyalty discounts are provided Yes Yes Public

25 E-commerce facilities are provided No No Private

26 E-transactions are safe enough Yes Yes Public

27 Customers are always informed about every transaction on paper

Yes Yes Private

28 Customers are provided new credit/debit card well in advance before their current card expires as well as check books

Yes Yes Private

29 Check clearance takes minimal time Yes Yes Private

Total 10/29 15/29

From the above we came to know that, Private Sector Banks are satisfying 15 out of 29

statements and Public Sector Banks are satisfying 10 out of 29 statements. Thus we can say

that, Private Sector banks have succeeded in making their image better in the minds of their

customers than Public Sector banks. With better service quality and better facilities that too

on proper time have helped Private Sector to come up and thus nowadays customers prefer

the Private Sector Banks more.

On the other hand, even though Public Sector Banks are less preferred by many customers,

there are still such factors like less interest rates, trust and safety which customers see in

Public Sector and go for them. If Public Sectors just focus on some service quality and

facilities then they can get much better and be preferred back by the customers.

Findings and Suggestions:

We found out that according to the statements, Private Sector Banks are satisfying in 15 out

of 29 statements and Public Sector banks are satisfying in 10 out of 29 statements. But apart

from this, Private Sector Banks are better than Public Sector Banks in 21 out of 29

statements. This shows that nowadays people highly prefer Private Sector Banks due to

better service and facilities which Private Sector Banks are offering.

Also we found out that though Private Sector Banks are better in service quality and

facilities but still there are parameters which customers prefer which lead them to Public

Sector Banks. People still feel safer while working with the Public Sector Banks than Private

Sector Banks. Thus Private Sector Banks have to work harder to generate an image of safer

bank than Public Sector Banks so that customers prefer them more.

On the other hand, Public Sector Banks are still there in the market in spite of the tough

competition given by Private Sectors due to their goodwill, low interest rates and trust what

customers have on them. Thus if the Public Sector Banks have to lure more customers, then

they have to give better service quality, flexibility and facilities to their customers.

Conclusion:

Thus we can conclude from this research that in Vallabh Vidyanagar, Customers are more

inclined towards Private Sector banks than towards Public Sector banks. Apart from many

people who are having more of Government jobs or old accounts are still with the Public

Sector banks while the new and potential customers are going towards Private Sector banks.

As nowadays competition is too high in the market, in order to retain their position Private

and Public Sector Banks both have to work hard.

mris final.pdf

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