A Systematic Study on Customer

Relationship Management in
Indian Retail Banking

PRESENTED BY:
INDERPREET KAUR
2024511
MBA
SUMMARY

 Although banking is an old activity and has roots

on Economics, Finance and Commerce, the
concept of Customer Relationship Management is
of recent origin.
 To many people Customer Relationship
Management means is “A co-ordinate approach
to the selling process allowing the various
operational, customer contact and sales
promotional functions of an organization to
functions as a whole”.
Universally conducting efficient banking operations and
associated business involves managing;
 The information and communication technology that
drives banks core business
. Customer relationships
. Risk associated with conducting business with
customers and other banks and financial institutions.
BANKING?

 Banking in a traditional sense is the business

of accepting deposits of money from public
for the purpose of lending and investments.
These deposits can have a distinct feature of
being withdrawal by cheques, which no other
financial institution can offer.
Today the commercial banking system in
India may be distinguished into:
 PUBLIC SECTOR BANKS
 CO-OPERATIVE SECTOR BANKS
 DEVELOPMENT BANKS:
• Industrial Finance Corporation of India (IFCI)
• Industrial Development Bank of India (IDBI)
• Industrial Credit and Investment Corporation of India (ICICI)
• Industrial Investment Bank of India (IIBI)
• Small Industrial Development Bank of India (SIDBI)
 NATIONAL HOUSING BANK
RETAIL BANKING?

 Retail Banking refers to the branch in which

banks execute transactions directly with
individual customers rather than corporations
or entities.
 It involves offering of products like credit
cards, debit cards, mortgages & loans,
insurance products, depository services, etc.
Products of retail banking

 Checking Accounts
 Saving Accounts
 Money Market Account
 Certificate of Deposit
 Debit Card
 Credit Card
 ATM Card
 Mutual Fund
 Current Account
 Other services
TYPES OF PRODUCTS:
 Formal Products
 Augmented Products
 Deposit Product
 Housing Loan
 Consumable-Durable Loan
 Educational Loan
 Auto Loan
 Personal Loan
 Internet Banking
 Home Banking
 Mobile Banking
LITERATURE REVIEW
 van Deventer and Redda, 2019; Parvin, 2019; Vencataya et
al., 2020: Satisfaction is influenced by banking product
features, service fees, communication methods, and, to a
smaller degree, customer convenience.
 Zhuo, 2020: the growing interest in SIX SIGMA resulting from
the conclusion that continuous process improvement and
error elimination will have a positive influence on the level of
satisfaction as perceived by customers.
 Mittal, Agrawal and Gupta, 2020: Research has also shown
that female customers are relatively more satisfied with
service quality and more loyal to their banks, in comparison to
male customers.
OBJECTIVES OF THE STUDY
 To assess the role of customer relationship management in the
Public sector banks , Private sector banks and Foreign banks.
 To assess the perception of the bank employees towards the
implementation of customer relationship management in the
banks.
 To assess the perception and satisfaction of the customers
with the banks.
 To understand the Indian banking system.
 To understand the retail trends followed by the modern retail
banks.
 To understand the banking relationship of organizations with
their existing banker.
Scope of the study

 Study will help to understanding the Indian

banking system as well as to identify the
existing bank “Market reputation”.
 Study will provide information about general
practices adopted by the various bank in
order to carry their customers in the area of
retail banking business.
RESEARCH METHODOLOGY
 RESEARCH DESIGN: DESCRIPTIVE
 SAMPLE SIZE: 30
 METHOD OF SELECTING SAMPLE: QUESTIONAIRE

 DATA SOURCES:
 PRIMARY DATA
 SECONDARY DATA

The descriptive research design is used for analyzing and

study the customer relationship management in Indian
Retail Banking. It is very simple & more specific than
explanatory study.
CUSTOMER RELATIONSHIP MANAGEMENT
IN INDIAN RETAIL BANKING
CRM?

“Customer Relationship Management (CRM) is a co-ordinate

approach to the selling process allowing the various
operational, customer contact and sales promotional
functions of an organization to function as a whole.”
WHY IS IT NECESSARY?
Many companies are turning to customer relationship management
systems to better understand customer wants and needs. CRM
applications often used in combination with data warehousing e-
commerce application and call-centre, which allows companies to
assess information about customers buying history, preferences,
complaints and other data so they can better anticipate what
customer will want. The goal is to install greater customer loyalty.
Other benefits include: The ability to provide faster response to
customer inquiries. Increase efficiency through automation. Having
a deeper knowledge of customers.Getting more marketing of cross
selling opportunities. Identifying the most profitable customers.
Receiving the customer feedback that leads to new and improved
product and services. Doing One to One marketing.
WHY NOW?

Ownership of customer relationship provides

exponentially greater rewards than
differences in product, price, promotion or
place of distribution could ever offer. All of
these factors can even be mitigated if you can
serve as the one stop provider that can
identify. Quantify, and service customer’s
need.
OBJECTIVES AND GOALS

 Increase in Customer Service

 Increasing Efficiency
 Lowering Operating Costs
 Aiding the Marketing Department
CRM IN BANKS
 Customer relationship management helps banking sector to use of
technology and human resources. These factors allow them to gain
insight of consumer behaviour and their values.
 If CRM works better then the bank can provide better customer
service, help sales staff close deals faster, cross sell products more
effectively, make call centres more efficient, discover new
customers, simplify marketing and sales processes and increasing
consumer revenue.
 It could not happen with just buying software and installing into the
system. In this the bank must decide as what type of customer
information that they are asking. It has to further decide as to what
they intend to do with the information. After all these after that the
banks decide and run a model considered by them simply the best.
 Generally, CRM integrates various components of a business such as
sales, marketing, IT and accounting. This strategy may not increase a
business's profit today or tomorrow, but it will add customer loyalty to
the business. In the long run, CRM produces continuous scrutiny of the
bank's business relationship with the customer, thereby increasing the
value of his business. Although CRM is known to be a relatively new
method in managing customer loyalty, it has been used previously by
retail businesses for many years.
 The CORE OBJECTIVE of modern CRM methodology is to help
businesses to use technology and human resources to gain a better view
of customer behaviour. With this, a business can hope to achieve better
customer service, make call centres more efficient, cross-sell products
more effectively, simplify marketing and sales processes, identify new
customers and increase customer revenues.
Steps to minimize the work regarding
adoption of CRM strategy.
 Identification of proper CRM initiatives
 Implementing adequate technologies in order to assist CRM initiative.
 Setting standards (targets) for each initiative and each person involved in
that circle .
 Evaluating actual performance with the standard or benchmark.
 Taking corrective actions to improve deviations, if any Customer
Relationship Management is concerned with attracting, maintaining and
enhancing customer relationship in multi service organizations. CRM
goes beyond the transactional exchange and enables the marketer to
estimate the customer’s sentiments and buying intentions so that the
customer can be provided with products and services before the starts
demanding. Customers are the backbone of any kind of business
activities, maintaining relationship with them yield better result.
IMPLEMENTING CRM

 Bringing together a CRM implementation

team.
 Creating a change management plan.
 Forecasting a CRM implementation budget.
 Rolling out your new system - migrating data.
 Going live and how to plan for it.
 Evaluating the success of your CRM
implementation project.
IMPORTANCE OF CRM

 Improved Customers Retention

 Boosted Sales
 More Effective Marketing Efforts
 Increased Productivity
 Personalized Customer Relationships
 Efficient Communication
 Better Customer Service and Experience
TECHNIQUES IN CRM

 Customer Service and Retention

 Call Centers
 Sales
DATA ANALYSIS
AND
INTERPRETATIONS
GENDER
AGE GROUPS
BANK NAME
NATURE OF BANK ACCOUNT
RELATIONSHIP WITH BANKS
SWOT ANALYSIS
 A SWOT analysis is a compilation of your company’s
strengths, weaknesses, opportunities and threats.
 The primary objective of a SWOT analysis is to help
organizations develop a full awareness of all the factors
involved in making a business decision.
 Perform a SWOT analysis before you commit to any sort of
company action, whether you are exploring new initiatives,
revamping internal policies, considering opportunities to
pivot or altering a plan midway through its execution.
 Use your SWOT analysis to discover recommendations and
strategies, with a focus on leveraging strengths and
opportunities to overcome weaknesses and threats.
AXIS BANK
STRENGTHS
 Axis Bank has been awarded the status of one of the three top
positions with regard to the fastest growth for private sector
banks
 Financial Express has been awarded the number two, and BT-
KPMG given the AXIS banking as the most reputable bank with 26
factors
 The bank’s network consists of 1,493 branches across the country
and 8,324 ATMs
 The bank is present in 971 towns and cities.
 The financial position of banks increase by 20% per year, which is
an excellent signal for any bank.
 The net income of the company in Q3FY12 1,102.27 which is an
rise of 25.19 percent compared to 2011.
WEAKNESS
 Gaps – They are mostly were concentrated on wholesale, corporate banking
and treasury services. retail banking.
 Foreign branches comprise just 8% of the total assets.
 The bank has recently begun making a shift to rural and personal banking.
 The share rate of AXIS bank are constantly fluctuating with higher margins
that put investors uncomfortable all the time.
 There are many Financial product shortcomings in terms performance and
reaching out to customers.
 There are a variety of fraudulent activities that are associated with credit
cards since banks approve credit card applications without verification of the
original documents.
 The financial experts they employ are not knowledgeable enough to guide
customers to the best investments.
 Service to customers needs to be improved substantially to keep pace with
other big players.
OPPORTUNITIES
 The year 2009 saw the launch of an Alliance was formed with Motilal
Oswal for online trading with 10 million customers.
 In 2010, it was acquired Enam Securities Pvt Ltd – broking and
investment banking.
 In September 2009, SEBI has approved Axis Asset Management Co.
to manage mutual funds.
 No. of transactions via electronic means increased between 0.7
million to about 2 million.
 Expanding geographically into the rural marketplace – 80 percent of
them do not have access to formal loan.
 46% use informal lending channels.
 24% of unregulated money lenders are not regulated.
 The number of branches has is increased to 1493 from 339 branches.
 In the last quarter, there were 48 branches that were opened
all over the Nation.
 Because it’s a modern banking system, there are plenty
of possibilities to benefit from the latest technology in
banking solutions as relative to major players that are
already in place.
 The assets they have in the company’s overseas activities are
increasing at a rapid speed, and at a rate of 9.9%.
 The idea of ETM (Everywhere teller machine) by AXIS Bank
had a good response , in terms of attracting new customers
to its personal banking.
THREATS
 n 2009 alone, RBI has increased CRR by 100 basis points.
 Repo rate increased reverse repo rates by 50 percent. 11 times
the rate of late.
 Growing the popularity QIPs due to their ease of fundraising.
 RBI permitted international banks to make investments as
much as 74% into Indian banking.
 The government programs are usually handled by
government banks such as SBI Indian Banks Punjab National
Bank etc.
 ICICI, as well as HDFCC and ICICI, are posing significant
threats to their growth in customer base through its active
strategy of marketing.
LIMITATION OF THE STUDY

 Due to time constraint, the research was

confined to ADAMPUR only Sample size is
very small.
 Some of the respondents shows biasness and
gave wrong information.
 Some of the respondents do not cooperate
and are not interested in answering.
CONCLUSION
 Technical solutions deployed by banks today are flexible, user-friendly and meant
to facilitate specific workflow and requirements in implementation processes. In
order to simplify lives, banks have begun to implement end-to-end technologies
through all departments with the intention of removing human error from
processes. Previously existing manual environments could not have been
adequate for future visions, growth plans and strategies.
 In this day and age, customers enjoy complete luxury in terms of customized
technical solutions and banks use the same to cement long-term, mutually-
beneficial relationships. For a bank to succeed in adopting a CRM philosophy of
doing business, bank management must first understand CRM as a holistic
concept that involves multiple, interlocking disciplines, including market
knowledge, strategic planning, business process improvement, product design
and pricing analysis, technology implementation, human resources
management, customer retention, and sales management and training.
LIMITATIONS OF RETAIL BANKING

 Huge Sales and Promotion Expenditure

 Managing Human Resources
 Managing Technology
 Pressures on Margin
 Continuous Follow-up
 Attitude Hurdles
 Security Problems
RECOMMENDATIONS
 Successful mass customization is crucial to reducing customer acquisition cost
and improving the cross selling capacity.
 Channels are a delivery mechanism. The effectiveness of the mechanism is
achieved when it is faultless!
 75% of all Customer Relationship Management projects have failed due to lapses
in implementation. Technology is not enough, implementation is the key and this
is where the people aspect comes into the forefront.
 Customer Relationship Management implementation is effective when
companies are able to identify the internal and external customer and integrate
them with its core business process.