PROJECT REPORT

ON
“SERVICE QUALITY OF HDFC BANK”
AT

HDFC BANK

1
 INDEX

CONTENTS PAGE NO.

1. INTRODUCTION

2. COMPANY PROFILE

3. SERVICE QUALITY IN BANKS

4. RESEARCH OBJECTIVE

5. RESEARCH METHODOLOGY

6. DATA ANALYSIS

7. FINDINGS OF THE REPORT

8. CONCLUSION

9. RECOMMENDATIONS

10. BIBLIOGRAPHY

11. ANNEXURE: QUESTIONNAIRE

 INTRODUCTION OF BANKING

Service with a smile:

Today‟ s finicky banking customers will settle for nothing less. The customer
has come to realize somewhat belatedly that he is the king. The customer‟ s
choice of one entity over another as his principal bank is determined by
considerations of service quality rather than any other factor. He wants
competitive loan rates but at the same time also wants his loan or credit card
application processed in double quick time. He insists that he be promptly
informed of changes in deposit rates and service charges and he bristles with
„customary rage‟ if his bank is slow to redress any grievance he may have. He
cherishes the convenience of impersonal net banking but during his
occasional visits to the branch he also wants the comfort of personalized
human interactions and facilities that make his banking experience
pleasurable. In short he wants financial house that will more than just clear
his cheque and updates his passbook: he wants a bank that cares and provides
great services.

So does HDFC bank meet these heightened expectations? What are the
customers‟ perceptions of service quality of the banks? Which dimension of
service quality of HDFC bank is performing well? To find out answers to these
questions I undertook a survey of 2 branches of HDFC bank.

A lot of surveys have been done in the past to understand the aspect of
customer satisfaction and to find out the customer friendly banks. My
research is conducted to find out “SERVICE QUALITY OF HDFC BANK”.
COMPANY
PROFILE
The Housing Development Finance Corporation Limited (HDFC) was amongst
the first to receive an 'in principle' approval from the Reserve Bank of India
(RBI) to set up a bank in the private sector, as part of the RBI's liberalisation
of the Indian Banking Industry in 1994. The bank was incorporated in August
1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai,
India. HDFC Bank commenced operations as a Scheduled Commercial Bank in
January 1995.

HDFC Bank comprises of a dynamic and enthusiastic team determined to

accomplish the vision of becoming a World-class Indian bank. HDFC bank‟ s
business philosophy is based on our four core values - Customer Focus,
Operational Excellence, Product Leadership and People. They believe that the
ultimate identity and success of their bank will reside in the exceptional
quality of people and their extraordinary efforts. They are committed to
hiring, developing, motivating and retaining the best people in the industry.
 BUSINESS
FOCUS

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to

build sound customer franchises across distinct businesses so as to be the
preferred provider of banking services for target retail and wholesale
customer segments, and to achieve healthy growth in profitability, consistent
with the bank's risk appetite. The bank is committed to maintain the highest
level of ethical standards, professional integrity, corporate governance and
regulatory compliance. HDFC Bank's business philosophy is based on four
core values - Operational Excellence, Customer Focus, Product Leadership and
People.

MISSION STATEMENT OF HDFC BANK

* World Class Indian Bank.

* Benchmarking against international standards.

* To build sound customer franchises across distinct businesses

* Best practices in terms of product offerings, technology,

service levels, risk management and
audit & compliance

VISION STATEMENT OF HDFC BANK

The HDFC Bank is committed to maintain the highest level of ethical

standards, professional integrity and regulatory compliance. HDFC Bank‟ s
business philosophy is based on four core values such as:-

1. Operational excellence.

2. Customer Focus.
3.Product leadership.

4. People.

The objective of the HDFC Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one-
step window for all his/her requirements. The HDFC Bank plus and the
investment advisory services programs have been designed keeping in mind
needs of customers who seeks distinct financial solutions, information and
advice on various investment avenues.

BUSINESS STRATEGY

* Increasing market share in India‟s expanding banking

* Delivering high quality customer service

* Maintaining current high standards for asset quality through

disciplined credit risk management

* Develop innovative products and services that attract targeted

customers and address inefficiencies in the Indian financial
sector.
DISTRIBUTION NETWORK

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable

network of over 1229 branches spread over 444 cities across India. All
branches are linked on an online real-time basis. Customers in over 120
locations are also serviced through Telephone Banking. The Bank's expansion
plans take into account the need to have a presence in all major industrial and
commercial centers where its corporate customers are located as well as the
need to build a strong retail customer base for both deposits and loan
products. Being a clearing/settlement bank to various leading stock
exchanges, the Bank has branches in the centers where the NSE/BSE has a
strong and active member base.

The Bank also has a network of about over 2526 networked ATMs across these
cities. Moreover, HDFC Bank's ATM network can be accessed by all domestic and
international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American
Express Credit/Charge cardholders.

PROMOTER

HDFC is India's premier housing finance company and enjoys an impeccable track
record in India as well as in international markets. Since its inception in 1977, the
Corporation has maintained a consistent and healthy growth in its operations to
remain a market leader in mortgages. Its outstanding loan portfolio covers well
over a million dwelling units. HDFC has developed significant expertise in retail
mortgage loans to different market segments and also has a large corporate client
base for its housing related credit facilities. With its experience in the financial
markets, a strong market reputation, large shareholder base and unique consumer
franchise, HDFC was ideally positioned to promote a bank in the Indian
environment.
MANAGEMENT

Mr. C.M. Vasudev has been appointed as the Chairman of the Bank with effect
from 6th July 2010 subject to the approval of the Reserve Bank of India and the
shareholders. Mr. Vasudev has been a Director of the Bank since October 2006. A
retired IAS officer, Mr. Vasudev has had an illustrious career in the civil services
and has held several key positions in India and overseas, including Finance
Secretary, Government of India, Executive Director, World Bank and Government
nominee on the Boards of many companies in the financial sector.
The Managing Director, Mr. Aditya Puri, has been a professional banker for over
25 years, and before joining HDFC Bank in 1994 was heading Citibank's
operations in Malaysia.
The Bank's Board of Directors is composed of eminent individuals with a
wealth of experience in public policy, administration, industry and commercial
banking. Senior executives representing HDFC are also on the Board.
Senior banking professionals with substantial experience in India and abroad head
various businesses and functions and report to the Managing Director. Given the
professional expertise of the management team and the overall focus on recruiting
and retaining the best talent in the industry, the bank believes that its people are a
significant competitive strength.

TECHNOLOGY
HDFC Bank operates in a highly automated environment in terms of information
technology and communication systems. All the bank's branches have online
connectivity, which enables the bank to offer speedy funds transfer facilities to its
customers. Multi-branch access is also provided to retail customers through the
branch network and Automated Teller(ATMs).
The Bank has made substantial efforts and investments in acquiring the best
technology available internationally, to build the infrastructure for a world class
bank. The Bank's business is supported by scalable and robust systems which
ensure that our clients always get the finest services we offer.
The Bank has prioritised its engagement in technology and the internet as one of its
key goals and has already made significant progress in web-enabling its core
businesses. In each of its businesses, the Bank has succeeded in leveraging its
market position, expertise and technology to create a competitive advantage and
build market share.
QUALITY POLICY

SECURITY: The bank provides long term financial security to their policy. The
bank does this by offering life insurance and pension products.

TRUST: The bank appreciates the trust placed by their policy holders in the bank.
Hence, it will aim to manage their investments very carefully and live up to this
trust.

INNOVATION: Recognizing the different needs of our customers, the bank offers
a range of innovative products to meet these needs.

INTEGRITY

CUSTOMER CENTRIC

PEOPLE CARE “ONE FOR ALL AND ALL FOR ONE”

TEAM WORK

JOY AND SIMPLICITY

BUSINESS

HDFC Bank offers a wide range of commercial and transactional banking services
and treasury products to wholesale and retail customers. The bank has three key
business segments.

Wholesale Banking Services The Bank's target market ranges from large, blue-
chip manufacturing companies in the Indian corporate to small & mid-sized
corporates and agri-based businesses. For these customers, the Bank provides a
wide range of commercial and transactional banking services, including working
capital finance, trade services, transactional services, cash management, etc. The
bank is also a leading provider of structured solutions, which combine cash
management services with vendor and distributor finance for facilitating superior
supply chain management for its corporate customers. Based on its superior
product delivery / service levels and strong customer orientation, the Bank has
made significant inroads into the banking consortia of a number of leading Indian
corporates including multinationals, companies from the domestic business houses
and prime public sector companies. It is recognised as a leading provider of cash
management and transactional banking solutions to corporate customers, mutual
funds, stock exchange members and banks.

Retail Banking Services

The objective of the Retail Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one-stop
window for all his/her banking requirements. The products are backed by world-
class service and delivered to customers through the growing branch network, as
well as through alternative delivery channels like ATMs, Phone Banking, Net
Banking and Mobile Banking.
The HDFC Bank Preferred program for high net worth individuals, the HDFC
Bank Plus and the Investment Advisory Services programs have been designed
keeping in mind needs of customers who seek distinct financial solutions,
information and advice on various investment avenues. The Bank also has a wide
array of retail loan products including Auto Loans, Loans against marketable
securities, Personal Loans and Loans for Two-wheelers.
It is also a leading provider of Depository Participant (DP) services for retail
customers, providing customers the facility to hold their investments in electronic
form. HDFC Bank was the first bank in India to launch an International Debit Card
in association with VISA (VISA Electron) and issues the Mastercard Maestro debit
card as well. The Bank launched its credit card business in late 2001. By March
2010, the bank had a total card base (debit and credit cards) of over 14 million. The
Bank is also one of the leading players in the “merchant acquiring” business with
over 90,000 Point-of-sale (POS) terminals for debit / credit cards acceptance at
merchant establishments. The Bank is well positioned as a leader in various net
based B2C opportunities including a wide range of internet banking services for
Fixed Deposits, Loans, Bill Payments, etc.

Treasury

Within this business, the bank has three main product areas - Foreign Exchange
and Derivatives, Local Currency Money Market & Debt Securities, and Equities.
With the liberalisation of the financial markets in India, corporates need more
sophisticated risk management information, advice and product structures. These
and fine pricing on various treasury products are provided through the bank's
Treasury team. To comply with statutory reserve requirements, the bank is
required to hold 25% of its deposits in government securities. The Treasury
business is responsible for managing the returns and market risk on this investment
portfolio.
SERVICE QUALITY
IN
BANKS
In the days of intense competition, the banks are no different from any other
consumer marketing company. It has become essential for the service firms in
general and banks in particular to identify what the customer's requirements
are and how those customer requirements can be met effectively. In the days
where product and price differences are blurred, superior service by the
service provider is the only differentiator left before the banks to attract,
retain and partner with the customers. Superior service quality enables a firm
to differentiate itself from its competition, gain a sustainable competitive
advantage, and enhance efficiency .The benefits of service quality include
increased customer satisfaction, improved customer retention, positive word
of mouth, reduced staff turnover, decreased operating costs, enlarged market
share, increased profitability, and improved financial performance. The
construct of service quality has therefore been a subject of great interest to
service marketing researchers.
Service quality has been defined by various experts in various ways as:
'Service Quality is the difference between customers' expectations for service
performance prior to the service encounter and their perceptions of the
service received.' According to Gefan „Service quality is the subjective
comparison that customers make between the qualities of service that they
want to receive and what they actually get.' Parasuraman says, 'Service quality
is determined by the differences between customer's expectations of services
provider's performance and their evaluation of the services they received.
Service quality is 'the delivery of excellent or superior service relative to
customer expectations‟ . Service quality is recognized as a multidimensional
construct. While the number of dimensions often varies from researcher to
researcher, there is some consensus that service quality consists of three
primary aspects: outcome quality, interaction quality, and physical service
environment quality. Outcome quality refers to the customer's assessment of
the core service which is the prime motivating factor for obtaining the
services (e.g. money received from ATM). Interaction quality refers to the
customer's assessment of the service delivery process, which is typically
rendered via a physical interface between the service provider, in person, or
via technical equipment, and the customer. It includes, for instance, the
consumer's evaluation of the attitude of the service providing staff. The
physical service environment quality dimension refers to the consumer's
evaluation of any tangible aspect associated with the facilities or equipment
that the service is provided in/ with. It includes, for example, the physical
conditions of an ATM machine.
The most popular dimensions of service quality--features five dimensions:
tangibles, reliability, responsiveness, empathy, and assurance. The
tangibles dimension corresponds to the aforementioned physical
environment aspect, the reliability dimension corresponds to the service
outcome aspect, and the remaining three represent aspects of interaction
quality. Both the costs and the revenue of firms are affected by repeat
purchases, positive word-of-mouth recommendation, and customer feedback.
Moreover, there is strong evidence that service quality has either a direct
influence on the behavioral intentions of customers and/or an indirect
influence on such intentions, mediated through customer satisfaction.
RATER is an instrument that might be used to define and measure banking
service quality and to create useful quality-assessment tools.

The RATER may finally provide the following benefits to the HDFC bank:

1. It is the first approach to add and mix the customers‟ religious beliefs and
cultural values with other quality dimensions.

2. It provides for multi-faced analysis of customer satisfaction.

3. It links quality with customers‟ satisfaction and service encounter.

4. It provides information at several levels, already organized into

meaningful groupings.

5. It is a proven approach, which results in usable answers to

meet customers‟ needs.

6. It is empirically grounded, systematic and well documented.

Banks managers can use the RATER model and its dimensions first to identify
the following issues:
 RESPONSIVENES

TANGIBILIT RELIABILITY

EMPATHY ASSURANCE

DIMENSIONS OF
SERVICE
QUALITY
DIMENSIONS OF SERVICE QUALITY

TANGIBILITY: This dimension deal with modern looking equipments and visual
appealing part of banks.

RELIABILITY: This dimension has a direct positive effect on perceived service

quality and customer satisfaction in banking institutions. Banks must provide error
free service and secure online transactions to make customers feel comfortable.

RESPONSIVENESS: Customers expect that the banks must respond their inquiry
promptly. Responsiveness describes how often a bank voluntarily provides
services that are important to its customers. Researchers examining the
responsiveness of banking services have highlighted the importance of perceived
service quality and customer satisfaction.

ASSURANCE: Customer expects that the bank must be secured and the behavior
of the employees must be encouraging.

EMPATHY: individual attention, customized service and convenient banking

hours are very much important in today‟ s service.

In order to achieve better understanding of service quality in banking sector,

the proposed five service quality dimensions are conceptualized to illustrate
the overall service quality of the banking in relation to customers‟ and
providers perspective.

Banking was in the sector featuring medium goods and higher customer
producer interactions, since in banking, consumers and service providers
interact personally and the use of goods is at a medium level. Hence, in
banking, where there are high customer-producer interactions, the quality of
service is determined to a large extent by the skills and attitudes of people
producing the service.

In the case of services, because customers are often either direct observers of
the production process or active participants, how the process is performed
also has a strong influence on the overall impression of the quality of service.
A well-performed service encounter may even overcome the negative
impression caused by poor technical quality as well as generate positive
word-of-mouth, particularly if customers can see that employees have worked
very hard to satisfy them in the face of problems outside their control.
Employees are part of the process, which connects with the customer at the
point of sale, and hence employees remain the key to success at these service
encounters or “moments of truth”. It is these encounters with customers
during a service that are the most important determinants of overall
customer satisfaction, and a customer‟ s experience with the service will be
defined by the brief experience with the firm‟ s personnel and the firm‟ s
systems. The rudeness of the bank‟ s customer service representative, the
abruptness of the employee at the teller counter, or the lack of interest of the
person at the check deposit counter can alter one‟ s overall attitude towards
the service, perhaps even reversing the impression caused by high technical
quality.

Another important service quality factor, competence, is defined by whether the

bank performs the service right the first time, whether the employees of the bank
tell customers exactly when services will be performed, whether the bank lives up
to its promises, whether customers feel safe in their transactions with the bank and
whether the employees show a sincere interest in solving the customers‟
problems. In short, this dimension is related to the banks‟ ability to perform the
promised service accurately and dependably. Performing the service dependably
and accurately is the heart of service marketing excellence. When a company
performs a service carelessly, when it makes avoidable mistakes, and when it fails
to deliver on promises made to attract customers, it shakes customers‟ confidence
in its capabilities and undermines its chances of earning a reputation for service
excellence.

It is very important to do the service right the first time. In case a service
problem does crop up, by resolving the problem to the customer‟ s
satisfaction, the company can significantly improve customer retention.
However, companies fare best when they prevent service problems altogether
and fare worst when service problems occur and the company either ignores
them or does not resolve them to the customer‟ s satisfaction.

Performing the service accurately is perhaps the most important factor in

service quality excellence. The cost of performing the service inaccurately
includes not only the cost of redoing the service but also the cost associated
with negative word-of-mouth generated by displeased customers. In case of
services, the factory is the field. Again, services are intangible and hence the
criteria for flawless services are more subjective than the criteria for defect-
free tangible goods. Hence for most services, customers‟ perceptions of
whether the service has been performed correctly, and not provider-
established criteria, are the major determinants of reliability.

The service quality factor tangible is defined by whether the physical facilities
and materials associated with the service are visually appealing at the bank.
These are all factors that customers notice before or upon entering the bank.
Such visual factors help consumers form their initial impressions. A crucial
challenge in service marketing is that customers cannot see a service but can
see the various tangibles associated with it - all these tangibles, the service
facilities, equipment and communication materials are clues about the
intangible service. If unmanaged, these clues can send to the customer‟ s
wrong messages about the service and render ineffective the marketing
strategy of the company. On the other hand, improving quality through
tangibles means attention to the smallest details that competitors might
consider trivial. Yet, these visible details can add up for customers and signal a
message of caring and competence.

Customers may reveal new aspects of service quality in banking that are
important to them, and these would have to be incorporated in the scale so as
to further explore the concept of service quality in the banking arena.
RESEARCH OBJECTIVE

AND

RESEARCH

METHODOLOGY
RESEARCH OBJECTIVE

The objective of the study is as follows:

 To examine the essential dimensions of service quality i.e. RATER-

Reliability, assurance, tangibles, empathy and responsiveness of HDFC bank
and its effect on customer‟ s satisfaction.

 To find out the level of perception of the customers from the service
quality offered by the banks.

 To know which service quality dimension of the bank is performing well.

 To identify which dimension of service quality needs improvement so that

the quality of service of HDFC banks is enhanced.
IMPORTANCE AND SCOPE OF THE STUDY

The study would try to throw some insights into the existing
services provided by the banks, perceptions and the actual service
quality of the bank. The results of the study would be able to
recognize the lacunae in the system and thus provide key areas
where improvement is required for better performance and success
ratio. In the days of intense competition, superior service is the only
differentiator left before the banks to attract, retain and partner
with the customers. Superior service quality enables a firm to
differentiate itself from its competition, gain a sustainable
competitive advantage, and enhance efficiency

SCOPE OF STUDY

The scope of this research is to identify the service quality of HDFC bank. This
research is based on primary data and secondary data. This study only focuses
on the dimensions of service quality i.e. RATER. It aims to understand the skill
of the company in the area of service quality that are performing well and
shows those areas which require improvement. The study was done taking
two branches of HDFC bank into consideration. The survey was restricted to
the bank customers in Delhi only.
RESEARCH METHODOLOGY

DATA SOURCE

Primary Data:
The primary data was collected by means of a survey. Questionnaires were
prepared and customers of the banks at two branches were approached to fill
up the questionnaires. The questionnaire contains 20 questions which reflect
on the type and quality of services provided by the banks to the customers.
The response of the customer and the is recorded on a grade scale of strongly
disagree, disagree, uncertain, agree and strongly agree for each question. The
filled up information was later analyzed to obtain the required interpretation
and the findings.

Secondary Data:

In order to have a proper understanding of the service quality of bank a depth

study was done from the various sources such as books, a lot of data is also
collected from the official websites of the banks and the articles from various
search engines like Google, yahoo search and answers.com.

RESEARCH DESIGN

The research design is exploratory till identification of service quality

parameters. Later it becomes descriptive when it comes to evaluating
customer perception of service quality of the banks.

Descriptive research, also known as statistical research, describes data and

characteristics about the population or phenomenon being studied.
Descriptive research answers the questions who, what, where, when and how.

Although the data description is factual, accurate and systematic, the research
cannot describe what caused a situation. Thus, descriptive research cannot be
used to create a causal relationship, where one variable affects another. In
other words, descriptive research can be said to have a low requirement for
internal validity.

The description is used for frequencies, averages and other statistical calculations.
Often the best approach, prior to writing descriptive research, is to conduct a
survey investigation. Qualitative research often has the aim of description and
researchers may follow-up with examinations of why the observations exist and
what the implications of the findings are

RESEARCH SAMPLE

SAMPLING PLAN:

Since it is not possible to study whole universe, it becomes necessary to take

sample from the universe to know about its characteristics.

 Sampling Units: Customers of HDFC bank

 Sample Technique: Random Sampling.

 Research Instrument: Structured Questionnaire.

 Contact Method: Personal Interview.

SAMPLE SIZE:

The work is a case of HDFC Bank, one of the largest bank of Indian banking
industry together representing over 25 per cent of the market share of Indian
banking space. The survey was conducted in the city of Delhi with two branches of
HDFC Bank, with 50 customers as respondent.

DATA COLLECTION TOOL

1. Strongly disagree

2. Disagree

3. Neither agree nor disagree

4. Agree

5. Strongly agree

Likert scaling is a bipolar scaling method, measuring either positive or

negative response to a statement. The questionnaire consists of two parts. The
first part consists of three questions concerning the demographic information
of the respondent such as the name, age, educational qualifications and
income. The second part consisting of 18 questions exploring the
respondent‟ s perception about the service quality of HDFC. For evaluation of
service quality of HDFC bank service quality dimension of reliability,
assurance, tangibility, empathy and responsiveness is used in order to
evaluate the actual service quality of HDFC bank.
LIMITATIONS OF THE STRATEGY

The study is only for the HDFC Bank confined to a particular location and a
very small sample of respondents. Hence the findings cannot be treated as
representative of the entire banking industry.

The study can also not be generalized for public and private sector banks of
the country.

Respondents may give biased answers for the required data. Some of the
respondents did not like to respond.

Respondents tried to escape some statements by simply answering “neither

agree nor disagree” to most of the statements. This was one of the most
important limitation faced, as it was difficult to analyse and come at a right
conclusion.

In our study we have included 50 customers of bank because of time limit.

 DATA
ANALYSIS
 Ques. Age

AGE CATEGORY FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

18-23 Years 10 20 20

24-29 Years 17 34 54

30-35 Years 15 30 84

35 Years and above 8 16 100

TOTAL 50 100

Sales

20 %
16 %
18-23 Year
24-29 Year
30 % 30-35 Year
34 % 35 and above
INTERPRETATION

From the table and graph above it can be seen that

20% respondent‟ s age are 18 to 23 years.

34% respondent‟ s age are 24 to 29 years.

30% respondent‟ s age are 30 to 35 years..

16% respondent‟s age are 35 to above years.

Ques. Educational qualifications

CATEGORY FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

UNDER
GRADUATE 13 26 26

GRADUATE
20 40 66
POST GRADUATE
17 34 100
TOTAL
50 100
 Sales

26 %
34 % UNDERGARDUATE
GRADUATE POST GRADUATE

40 %

INTERPRETATION

From the table above it can be seen that.

 26% respondents are Under graduate.

 40% respondents are Graduate.

 34% respondents are Post graduate.

TANGIBILITY DIMENSION OF SERVICE QUALITY
(Questions1 to 4):

Physical facilities, equipments and appearance of personnel

Ques.1 HDFC bank has modern looking equipment.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

STRONGLY 5 10 10
DISAGREE

DISAGREE 25 50 60
UNCERTAIN 16 32 92
AGREE 4 8 100
TOTAL 50 100

Sales

8 % 10 %
STRONGLY DISAGREE
32 % DISAGREE UNCERTAIN
AGREE

50 %
INTERPRETATION

HDFC bank has modern-looking and hi-tech equipments. Here analysis show
that most of the respondents disagreed with this statement. Among the total
respondents 50% disagreed, 32% were neutral and 8% agreed. After analysis
I found that majority of the respondents think that HDFC Bank do not have
modern looking equipments or no hi-tech equipments.

Ques.2 The bank's physical features are visually appealing.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 4 8 8
UNCERTAIN 29 58 66
AGREE 17 34 100
TOTAL 50 100
 Sales

8%
34 %
DISAGREE
UNCERTAIN AGREE

58 %

INTERPRETATION

HDFC bank‟ s physical facilities are visually appealing. From this statement I
found that 17 persons agreed. 29 persons were uncertain and 4 persons
disagreed. This means 58% people
were uncertain about this statement. Out of the total respondents only 4%
disagreed and no one strongly agreed or disagreed with the statement. 17%
people agreed that HDFC bank‟ s physical facilities are visually appealing.
Ques.3 The bank's reception desk employees are neat appearing.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 5 10 10
UNCERTAIN 21 42 52
AGREE 18 36 88
STRONGLY AGREE 6 12 100
TOTAL 50 100

Sales

12 % 10 %
DISAGREE

36 % 42 %
UNCERTAIN
AGREE
STRONGY AGREE
INTERPRETATION

HDFC bank‟ s employees appear neat. Here analysis shows that majority were
neutral. Among the total respondent 21 respondents were neutral, 18 people
agreed and 6 respondents strongly agreed. The rest disagreed. From analysis I
found that some respondents agreed with this statement but most of the
respondents think the employees of the HDFC bank appear neat.

Ques.4 Materials associated with the service (such as pamphlets or

statements) are visually appealing at the bank.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 7 14 14
UNCERTAIN 22 44 58
AGREE 18 36 94
STRONGLY 3 6 100
AGREE

TOTAL 50 100
 Sales

6%
14 %
DISAGREE
36 % UNCERTAIN AGREE
STRONGLY

44 %

INTERPRETATION

Materials associated with the service are visually appealing at HDFC bank.
Here 36% respondents agreed with this statement and 6% strongly agreed
with this statement. 44% were neutral that is most and 14% disagreed. There
was no respondent who strongly disagreed. Hence, in general it can be
concluded that materials associated with the services such as pamphlets or
statements are visually appealing.
RELIABILITY DIMENSION OF SERVICE QUALITY (Questions 5 to 8):

Ability to perform the promised service dependably and accurately

Ques.5 When the bank promises to do something by a certain time,

it does so.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

STRONGLY 2 4 4
DISAGREE

DISAGREE 26 52 56
UNCERTAIN 5 10 66
AGREE 14 28 94
STRONGLY AGREE 3 6 100
TOTAL 50 100
 Sales

STRONGLY DISAGREE DISAGREE UNCERTAIN

AGREE
STRONGLY AGREE

INTERPRETATION

My sample size was 50. Here analysis shows that among the total respondents
26 respondents disagreed and 14 respondents agreed with this question. Also
I found that 5 people were neutral and 2 people strongly disagreed. Hence I
concluded that majority of them disagreed that the bank when promises to do
something by certain time, it does so.
Ques. 6 When you have a problem, the bank shows a sincere interest
in solving it.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 3 6 6
UNCERTAIN 14 28 34
AGREE 26 52 86
STRONGLY AGREE 7 14 100
TOTAL 50 100

Sales

6%
14 %
28 %
DISAGREE
UNCERTAIN AGREE
STRONGLY AGREE

52 %
INTERPRETATION

When you have a problem, HDFC bank shows sincere interest in solving it.
After analysing this statement I found that most of the respondents agreed i.e.
52% respondents agreed. Also I found that 28% were neutral with this
statement and 6% were committed with disagree. There was no one who
strongly disagreed. Hence HDFC bank can be said to be reliable.

Ques.7 The bank performs the service right the first time.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

STRONGLY 2 4 4
DISAGREE

DISAGREE 8 16 20
UNCERTAIN 17 34 54
AGREE 17 34 88
STRONGLY AGREE 6 12 100
TOTAL 50 100
 Sales

4%
16%
34% STRONGLY DISAGREE
DISAGREE

AGREE
34% STRONGLY AGREE UNCERTAIN
12%

INTERPRETATION

Total sample size was 50. Here analysis shows that among the total
respondents 17 people agreed with this statement. They think that HDFC bank
performs the services right the first time. 6 people strongly agreed with this
statement. Also 17 people were neutral and the rest of the respondents
disagreed and strongly disagreed.
Ques.8 The bank insists on error free records.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 5 10 10
UNCERTAIN 10 20 30
AGREE
23 46 76
STRONGLY AGREE
12 24 100

TOTAL
50 100

Sales

10%
24 %
20%
DISAGREE
UNCERTAIN AGREE
STRONGLY AGREE
46%
INTERPRETATION

Bank insists on error free records. HDFC bank has proved from my analysis
that it surely insist on error free records as 46% respondents agreed with this
statement and 24% strongly agreed. Only 10% respondents disagreed and no
one strongly disagreed.

RESPONSIVENESS DIMENSION OF SERVICE

QUALITY (Question 9 to 12):

Willingness to help customers and provide prompt services

Ques. 9 Employees in the bank tell you exactly when the services will
be performed.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

STRONGLY 6 12 12
DISAGREE

DISAGREE 8 16 28
UNCERTAIN 13 26 54
AGREE 18 36 90
STRONGLY AGREE 5 10 100
TOTAL 50 100
 Sales

12%
STRONGLY DISAGREE
36% DISAGREE UNCERTAIN STRONGLY AGREE AGREE

26%
10%

INTERPRETATION
Employees in the bank tell you exactly when the services will be performed.
Majority of the respondents agreed with this statement. 26% respondents
were uncertain. At the same time 16% disagreed and 12% Strongly disagreed
with this statement.
Ques. 10 Employees in the bank give you prompt service.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 5 10 10
UNCERTAIN 16 32 42
AGREE 27 54 96
STRONGLY AGREE 2 4 100
TOTAL 50 100

Sales

4% 10%

54% DISAGREE
32% UNCERTAIN AGREE
STRONGLY AGREE
INTERPRETATION

Most of the respondents agreed with this statement. According to my analysis,

employees in HDFC Bank give prompt service. Among the total respondents
agreed respondents were 27 and strongly agreed were 2. 16 people were
neutral and 5 disagreed. There was no respondent who strongly disagreed
with this statement.

Ques.11 Employees in the bank are always willing to help you

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

UNCERTAIN 12 24 24
AGREE 29 58 82
STRONGLY AGREE 9 18 100
TOTAL 50 100

.
 Sales

18% 24%
UNCERTAIN
AGREE
STRONGLY AGREE
58%

INTERPRETATION

Employees in HDFC bank are willing to help you. With this statement no one
disagreed or strongly disagreed. Strongly agreed were 9 people i.e. 18%
respondents strongly agreed, 29 people agreed i.e. 58% respondents agreed
and 24% respondents were neutral.
Ques.12 Employees in the bank are never too busy to respond to
your request.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 1 2 2
UNCERTAIN 11 22 24
AGREE 27 54 78
STRONGLY AGREE 11 22 100
TOTAL 50 100

Sales

22% 22%
DISAGREE
UNCERTAIN
AGREE
54%
STRONGLY AGREE
INTERPRETATION

Employees in HDFC Bank ltd are never too busy to respond to your request.
After analyzing this statement I found that most of the respondents agreed
with this statement. Among the total respondents 22% strongly agreed and
54% agreed. 11 respondents were neutral and 1 respondent disagreed. No
one strongly disagreed.

ASSURANCE DIMENSION OF SERVICE QUALITY

(Question13 to 16):

Knowledge and courtesy of employees and their ability to inspire trust

and confidence

Ques.13 The employees of the bank are trustworthy.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 4 8 8
UNCERTAIN 13 26 34
AGREE 28 56 90
STRONGLY AGREE 5 10 100
TOTAL 50 100
 Sales

10% 8%
26% DISAGREE
56% UNCERTAIN AGREE
STRONGLY AGREE

INTERPRETATION

The employees of the bank are trustworthy. According to my findings, 54%

respondents agreed that employees at HDFC bank are trustworthy. 13%
respondents were neutral and 4% respondents disagreed with this statement.
Ques.14 The behavior of employees in the bank instills confidence in
you.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 28 56 56
UNCERTAIN 4 8 64
AGREE 13 26 90
STRONGLY AGREE 5 10 100
TOTAL 50 100

Sales

10%
26% 56%
DISAGREE
UNCERTAIN AGREE
STRONGLY AGREE

8%

S
INTERPRETATION

The behavior of employees in HDFC bank instills confidence in you. Here analysis
shows that most of the people disagreed. Among the total respondents 28
respondents disagreed, 13 agreed and 5 strongly agreed. There was no respondent
who strongly disagreed. This means 56% respondent disagreed with this statement.

Ques.15 You feel safe in your transactions with the bank.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 5 10 10
UNCERTAIN 16 32 42
AGREE 23 46 88
STRONGLY AGREE 6 12 100
TOTAL 50 100
 Sales

12% 10%
46%
1st Qtr
32% 2nd Qtr 3rd Qtr
4th Qtr

INTERPRETATION

With this statement most of the respondents agreed. Among the total
respondents 23 agreed with this statement and 6 strongly agreed. 32%
respondents were neutral and 10% respondents disagreed. But there no one
who strongly disagreed.
Ques.16 Employees in the bank have the knowledge to answer your
questions.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 2 4 4
UNCERTAIN 9 18 22
AGREE 26 52 74
STRONGLY AGREE 13 26 100
TOTAL 50 100

Sales

4%
26% 18%
DISAGREE
UNCERTAIN AGREE
STRONGLY AGREE
52%
INTERPRETATION

From my analysis I found that 54% respondents agreed that employees of

HDFC bank have complete knowledge to answer their questions. 26%
respondents strongly agreed to this statement and only 4% disagreed. 18%
neither agreed nor disagreed.

EMPATHY DIMENSION OF SERVICE QUALITY (Question17 to

20):

Caring and individualized attention that firm provides to its customers.

Ques.17 The bank gives you individual attention.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 26 52 52
UNCERTAIN 12 24 76
AGREE 10 20 96
STRONGLY AGREE 2 4 100
TOTAL 50 100
 Sales

4%
20%
52%
DISAGREE
UNCERTAIN AGREE
24% STRONGLY AGREE

INTERPRETATION

HDFC bank is not able to give individual attention to its customers as out of
the total respondents 54% disagreed with this statement. 12% of the
respondents were neutral and only 12% agreed and 2% strongly agreed.
From this finding it can be concluded that it is unable to give individual
attention to its customers.
Ques.18 The bank has operating hours convenient to all its
customers.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE 2 4 4

UNCERTAIN 14 28 32

AGREE 27 54 86

STRONGLY AGREE 7 14 100

TOTAL 50 100

Sales

4%
14%
28%
54% DISAGREE
UNCERTAIN AGREE
STRONGLY AGREE
INTERPRETATION

HDFC bank has operating hours convenient to all its customers. Out of 50
respondents, 27 respondents agreed with this statement and only 2
respondents disagreed. Also 7 respondents strongly agreed that the bank has
operating hours convenient to its customers.

Ques.19 The bank has your interests best at heart.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

STRONGLY
DISAGREE
3 6 6

DISAGREE
5 10 16
UNCERTAIN
10 20 36
AGREE
25 50 86
STRONGLY AGREE
7 14 100
TOTAL
50 100
INTERPRETATION

HDFC bank has your best interests at heart. Here analysis shows that 25
respondents agreed and 7 respondents strongly agreed with this statement.
20% were neutral and the rest disagreed and strongly disagreed .

Ques.20 The employees of the bank understand your specific

needs.

SCALE FREQUENCY PERCENTAGE CUMULATIVE

PERCENTAGE

DISAGREE
5 10 10
UNCERTAIN
21 42 52
AGREE
20 40 92
STRONGLY AGREE
4 8 100
TOTAL
50 100
 Sales

8% 10%

DISAGREE
40% 42% UNCERTAIN AGREE
STRONGLY AGREE

INTERPREATION

Employees of HDFC bank understand specific needs. With this statement most
of the respondents were neutral. Among the total respondents 20 respondents
agreed and 4 respondents strongly agreed. 5 respondents disagreed with this
statement.
 MEASURING SERVICE QUALITY DIMENSIONS

Measuring the quality of a service can be a very difficult exercise. Unlike

product where there are specific specifications such as length, depth, width,
weight, colour etc. a service can have numerous intangible or qualitative
specifications.
Parasuraman, Zeithaml, and Berry (1985) provide a list of determinants of
service quality: access, communication, competence, courtesy, credibility,
reliability, responsiveness, security, understanding, and tangibles. A total of
five consolidated dimensions of service quality are:
Tangibles (ques.1 to 4) - Physical facilities, equipments and appearance of
personnel
Reliability (ques.5 to 8) - Ability to perform the promised service dependably
and accurately
Responsiveness (ques.9 to 12) – Willingness to help customers and provide
prompt services
Assurance (ques.13 to 16) – (including competence, courtesy, credibility and
security) Knowledge and courtesy of employees and their ability to inspire
trust and confidence
Empathy (ques.17 to 20) – (including access, communication and
understanding the customer) Caring and individualized attention that firm
provides to its customer.
In order to calculate which dimension of service quality is performing well, a
sample of the questions are used in the questionnaire. Using the
questionnaire, obtain the score for each of the 20 statements. After analysis of
the data, Overall score to each statement is given on a scale of 1 to 5 i.e. 1 is
given to strongly disagreed i.e. the lowest score, then 2= disagreed, 3=
uncertain, 4= agreed and 5= strongly agreed.
Sum the score for each dimension of service quality to obtain a final score
which tells which
dimension is performing well and which dimension needs improvement.
The scores for each dimension are summed up and a final
score is obtained:

SERVICE QUALITY DIMENSION Points

1. TANGIBILITY (1 TO 4)
11

2. RELIABILITY (5 TO 8)
13.5

3. RESPONSIVENESS (9 TO 12)
16

4. ASSURANCE (13 TO 16)

14

5. EMPATHY (17 TO 20)

13
FINDINGS OF THE REPORT

 The Reliability dimension of service quality is better as compared to empathy

and tangibility. Still the score is low. For most services, customer‟ s perceptions of
whether the service has been performed correctly, and not provider-established
criteria, are the major determinants of reliability. Customers of the bank hesitate to
rely on the bank. Whenever they have a problem, the bank shows sincere interest
in solving it but the services are not performed by a certain time as promised. The
employees should take this problem seriously and take steps to remove this.

 As score for Assurance is at second place after responsiveness, so the

customers of HDFC bank are very confident and feel safe while transacting with
the bank. Moreover the employees of the bank have proved to be trustworthy.
Employees are also educated enough to answer all the questions.

 The score of Tangibility dimension of service quality of HDFC bank is the

lowest. The service quality factor tangible is defined by whether the physical
facilities and materials associated with the service are visually appealing at the
bank. These are all factors that customers notice before or upon entering the bank.
Customer expectations regarding visual appealing of HDFC is very high. From my
study I found that Physical facilities and modern looking equipment are not
sufficient in HDFC bank. Respondents were uncertain about the neat appearance
of the reception desk employees. So they should work on that and try to fulfill the
gap.

 According to my findings, the score of Empathy is not satisfactory but not

unsatisfactory also. HDFC bank is unable to give individual attention to its
customers and is unable to understand specific needs of its customers. But still
bank has taken steps to satisfy its customers by keeping operating hours
convenient to its customers and keeping their interest best at heart.

 In HDFC bank, the score of Responsiveness is highest so they are focusing

on prompt service, employees are willing to help the customers and say the exact
time when the services will be performed. Employees at bank give their customers
first preference and are always ready to help them. Overall HDFC bank‟ s
responsiveness dimension of service quality is the highest.
 According to the customer perception, HDFC bank is highly responsive.
Customers are assured while transacting with the bank. The reliability dimension
is lower than the first to dimension. They feel that the bank is unable to give them
individual attention and its equipments are not modern and sufficient for the bank.

 There is not much gap between all the dimensions, this shows that HDFC
BANK is a better service provider in all the dimensions i.e. reliability, assurance,
tangibility, responsiveness and empathy. As a result of which, the customers are
satisfied with the service offered by HDFC bank.
CONCLUSION

Based on the study conducted it can be concluded that responsiveness,

assurance and reliability are the critical dimensions of service quality of HDFC
bank and they are directly related to overall service quality. The factors that
may delight customers tend to be concerned more with the intangible nature
of the service, commitment, attentiveness, friendliness, care, and courtesy.
The employees give prompt services, always are ready to answer
the questions and are trustworthy. The main sources of dissatisfaction appear
to be cleanliness, up to date technology modern equipments, and neatly
dressed up employees. The Tangibility dimension of service quality of HDFC
bank is highly disappointing and serious steps are needed to be taken to
enhance this dimension. Customers of the bank are dissatisfied with the
empathy dimension. To satisfy these customers, the management can take
some attempts, noted earlier as recommendations.
The study brings about the areas which require urgent attention
of the employees, the management, and the policy makers of the industry.
These are areas in which customers are hugely dissatisfied with the services
of the banks against their expectation. This high degree of dissatisfaction
resulting from the services received clearly questions the design of services or
subsequent response of the bank employees. These limitations are too serious
to be avoided as these question the front-line people dealing with the
customers and the approach of the management in taking customers
seriously.
The management should understand the benefits of service quality. It include
increased customer satisfaction, improved customer retention, positive word
of mouth, reduced staff turnover, decreased operating costs, enlarged market
share, increased profitability, and improved financial
performance. In the days of intense competition, superior service is the only
differentiator left before the banks to attract, retain and partner with the
customers. Superior service quality enables a firm to differentiate itself
from its competition, gain a sustainable competitive advantage, and enhance
efficiency. Thus, improving service quality leads to the customer satisfaction
and, ultimately, to customer loyalty.
RECOMMENDATIONS

 Reliability is an obvious place to start. Customers of the bank want to know

their resources are safe and within trustworthy institutions. A way to ensure this
peace of mind would be to take steps to ensure bank employees are well trained, so
each bank associate is able to offer complete and comprehensive information at all
times. Consistent policies combined with a knowledgeable staff will foster a high
degree of institutional cohesion and reliability.

 Responsiveness, again when associated with a well-trained staff and timely

answers to service-related questions, would make significant inroads into
causing HDFC bank be regarded as responsive. Staff should be encouraged to
present relevant options to banking customers in a manner that does not resemble
salesmanship so much as a desire to serve.

 Intangibles please customers just as much as tangibles in the banking

industry. People tend to visit the same branch of a bank over and over again.
Usually, this is a location close to their home or their workplace. It is natural that
customers become comfortable and habituated to these branch banks, for the same
reason they develop familiarity with a neighborhood supermarket or convenience
store. It makes sense that bank employees would be encouraged to learn to
recognize these regular customers, learn their names, and begin to identify their
basic service requirements.

 Learning to understand customers‟ needs will allow bank associates to offer

enhanced services, perhaps lowering customers‟ banking costs and increasing
their investment potential. This could also open up the possibility of increased
profits for banks, for when perceived as more service and customer oriented, they
will, in effect, become a useful
and pleasant way to “shop.”
 Keeping the bank with up-to-date technologically are important factors.
Modern equipments, new improved technology should be replaced with the old
ones. If the staff inside is pleasant and well-informed, in an aesthetically pleasing
environment, then customer satisfaction will be high.
 The five-dimensional structure could possibly serve as a meaningful
framework for tracking a bank‟ s service quality performance over time and
comparing it against the performance of competitors. Items on some
dimensions should be expanded if that is necessary for reliability.

 Thus, the banking industries must continuously measure and improve

these dimensions in order to gain customers‟ loyalty.
BIBLIOGRAPHY

References

Kotler Philip, marketing management, (Pearson education, 12th edition)

Malhotra K. Naresh, marketing research (An applied orientation), Research design,
(Prentice hall of India pvt. 5th edition)

Zeithmal V. A., Grembler D.D., Bitner M.j., and Pandit A.: Service Marketing
Integrated customer Focus across the Firm” (4th Edition)
M.K. Rampal : Service Marketing

Websites
www.hdfcbank.com
www.hdfcindia.com
www.wikipedia.org
www.marketresearch.com
ANNEXURE

QUESTIONNAIRE

Respected Sir/Madam

I am student of WORLD COLLEG OF TECHNOLOGY AND

MANAGEMENT, conducting a survey on “SERVICE QUALITY OF
HDFC BANK”. The following statements relate to your feelings about
the HDFC bank. Please show the extent to which you believe HDFC
bank has the feature described in the statement. I request you to √
the option which in your opinion are believed to be true .

Name:
Age:
Educational Qualifications

Strongly Disagree Neither Agree Strongly

QUESTIONS Disagree agreeNor Agree
disagree

1.HDFC bank has modern looking

equipment.

2. The bank's physical features are visually

appealing

3. The bank's reception desk employees are

neat appearing.

4. Materials associated with the service (such

as pamphlets or statements) are visually
appealing at the bank.

5. When the bank promises to do something

by a certain time, it does so.
6. When you have a problem, the bank
shows a sincere interest in solving it.

7. The bank performs the service right the

first time.

8. The bank insists on error free records.

9. Employees in the bank tell you exactly

when the services will be performed.

10. Employees in the bank give you prompt

service.

11. Employees in the bank are always

willing to help you.

12. Employees in the bank are never too

busy to respond to your request.

13. The employees of the bank are

trustworthy.

14. The behavior of employees in the bank

instills confidence in you.

15. You feel safe in your transactions with

the bank.

16. Employees in the bank have the

knowledge to answer your questions.

17. The bank gives you individual attention.

18. The bank has operating hours convenient

to all its customers

19. The bank has your best interests at heart.

20. The employees of the bank understand

your specific needs.