CHAPTER I

INTRODUCTION TO THE STUDY

1.1 THEORETICAL BACKGROUND

The title of the study is “Current Account & Saving Account Activation”. This study mainly

aims to analyze the factors contributing for CASA inactivation and also to study the customer’s

perception about HDFC CASA. This project is also analyzing that the preferred relationship can

be a solution to improve the CASA mix in HDFC bank.

CASA deposits are also called as cheap source of funds in Banking Terminology. This CASA

mix plays a vital role in the Banks. So every year, central bodies and Management are forcing

the banks to improve their CASA mix. It plays an essential role in the bank’s trust worthiness.

This will also provide a confidence to customers, investors and shareholders of the bank to

establish a long term relationship. Preferred Banking is a Programme offered by HDFC Bank to

its Customers. Under this Programme, a Banker or a Relationship Manager will be extensively

dedicated to customers who are seasoned profession and running very successful businesses over

years to take care of all their banking requirements and also suggesting them to invest their

money to get good returns.

HDFC Bank is currently having the CASA mix of 44.3% which is pretty lower than FY2009

55%. This is due to the merger of Centurion Bank of Punjab, which had CASA mix of only 25%.

The competitors of HDFC bank are maintaining the CASA mix of 41.6 by ICICI Bank and 46%

by AXIS Bank. Each bank’s CASA mix reduced to a greater extend in the Recession period.

Now all the banks are taking necessary steps to improve their CASA mix. So HDFC bank is also

taken essential step to improve their CASA mix in all the branches.

This Research study is mainly taken to analyze the various factors affecting the CASA

activation. This is the one way to weed out the accounts which are not going to be operated. The

1

preferred Relationship, which is provided to customers to invest their money in a right way, can

be given to prospective CASA customers to improve the CASA mix.

CHI SQUARE TEST

A chi-square test (also chi squared test or χ2 test) is any statistical hypothesis test in which the

sampling distribution of the test statistic is a chi-square distribution when the null hypothesis is

true, or any in which this is asymptotically true, meaning that the sampling distribution (if the

null hypothesis is true) can be made to approximate a chi-square distribution as closely as

desired by making the sample size large enough.

Some examples of chi-squared tests where the chi-square distribution is only approximately

valid:

Pearson's chi-square test , also known as the chi-square goodness-of-fit test or chi-square

test for independence. When mentioned without any modifiers or without other

precluding context, this test is usually understood (for an exact test used in place of χ2,

see Fisher's exact test).

Yates' chi-square test , also known as Yates' correction for continuity

Mantel–Hansel chi-square test .

Linear-by-linear association chi-square test .

The portmanteau test in time-series analysis, testing for the presence of autocorrelation

Likelihood-ratio tests in general statistical modeling, for testing whether there is evidence

of the need to move from a simple model to a more complicated one (where the simple

model is nested within the complicated one).

One case where the distribution of the test statistic is an exact chi-square distribution is the test

that the variance of a normally-distributed population has a given value based on a sample

2

variance. Such a test is uncommon in practice because values of variances to test against are

seldom known exactly.

Chi-square test for variance in a normal population

If a sample of size n is taken from a population having a normal distribution, then there is a well-

known result (see distribution of the sample variance) which allows a test to be made of whether

the variance of the population has a pre-determined value. For example, a manufacturing process

might have been in stable condition for a long period, allowing a value for the variance to be

determined essentially without error. Suppose that a variant of the process is being tested, giving

rise to a small sample of product items whose variation is to be tested. The test statistic T in this

instance could be set to be the sum of squares about the sample mean, divided by the nominal

value for the variance (i.e. the value to be tested as holding). Then T has a chi-square distribution

with n–1 degrees of freedom. For example if the sample size is 21, the acceptance region for T

for a significance level of 5% is the interval 9.59 to 34.17.

3

Chapter II

REVIEW OF LITERATURE

2.1 A Study on Customer Satisfaction on Retail Banking:

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

market, new technologies, economic uncertainties, fierce competition, and more demanding

customers; and the changing climate has presented an unprecedented set of challenges. In the

current circumstances a question arises whether the customers are satisfied or not and what are

the elements of retail banking which lead to the satisfaction or dissatisfaction of customers. The

knowledge of current levels of satisfaction and, in particular, the primary factors of satisfaction

are beneficial to those in the industry, thereby allowing them to focus and further strengthen the

key areas that lead to highly satisfied customers. This research paper mainly concentrates on the

level of satisfaction of customers on the retail products of a bank. The data collected from 100

customers of a branch. The principal component analysis on the factors provided a set of factors

which affecting the level of customer satisfaction. Improving upon the factors will yield a good

satisfaction level to the banks.

2.2 Contemporary Marketing Practices in Indian Retail banking:

This research study objective of the current study is to determine the relative emphasis placed on

transaction marketing versus relationship marketing in the scheduled commercial banks. The

study validates the contemporary marketing practices (CMP) model postulated by Coviello et al.

(1997), in the specific context of retail banking, proving thereby that banks practice pluralistic

behavior towards their retail customers. Further, the findings also indicate that banks exhibiting

such behavior enjoy a higher proportion of retail business and higher growth rates with respect to

the retail banking division.

4

2.3 Customer Orientation of Service Employees and Organizational Performance:

Empirical Evidence from Indian Banking:

The concept of Customer Orientation of Service Employees (COSE) continues to receive

considerable attention from research scholars and business professionals in developed countries.

However, very little or no such research has focused on understanding the complex relationship

between various dimensions of COSE and organizational performance in a developing country

like India. In order to plug the gap the present study has been conducted in the Indian service

sector with samples from its four prestigious banks. The study that matches perceptions from

both the contact employees and their customers reveals that (COSE) exerts its direct impact on

several employee out comes (employee service effort, job satisfaction, esprit de corps and

commitment) as well as on organizational performance (Customer service quality perception and

their satisfaction). The empirical results also report indirect effects of COSE on organizational

performance via the employee outcomes. These employee outcomes are found effective

mediators thus linking positive effects of COSE to customer outcomes.

2.4 Customer Expectations and Perceptions across the Indian banking industry and the

resultant Financial Implications:

The purpose of this paper is to study the expectations and perceptions of the consumers across

the three banking sectors in India. It further delineates the factors affecting the quality perception

of the customers in the banking sector and tries to corroborate this perception with the financial

performance of the Banks. The paper presents the primary data of 263 respondents across the

three banking sectors. To explore the customers’ perception of service quality factor analysis is

done and factors affecting the Indian customers are highlighted. A study of the financial

performance of the banks is also done to see if the perception of service quality has a

consequence on the banks bottom line. It was found that in the banking sector it is the foreign

banks which are perceived to be offering better quality of services followed by the private and

then public banks. It was also found that these perceptions are reflected in the financial

performance of the banks also. With the increasing competition amongst banks, the findings can

act as a strategic tool to achieve competitive advantage and customer satisfaction. It is also an

eye opener for the banks to see the gap between customer expectation and perception regarding

5

the quality of services rendered which should further act as a motivator to enhance reputation

and gain customer loyalty. This will in turn give them the elusive competitive edge they are

looking for.

2.5 Customer Satisfaction in Indian Banking Sector: A Study

Satisfaction with banking services is an area of growing interest to researchers and managers.

This study investigates relationship dimensions and studies the differences in perception of

customers with respect to services provided by five Indian banks. The relationship dimensions

which lead to customer satisfaction have been identified with the help of factor analysis. This

study reports on the different satisfaction levels of customers of private and public sector banks

with respect to the services provided by their banks. Perceptual mapping is an important

marketing research tool used in many areas of marketing. Strategies based on perceptual maps

have led to increased profits, better market control and more stable growth. This research tool

used to assess the strengths, improvement in services. This resulted as banks should advance

their customer centric strategies to improve the customer Satisfaction.

2.6 Impact of Service Quality on Customer Loyalty, Commitment and Trust in the Indian

Banking Sector:

In the present Indian banking scenario, service quality is an indispensable competitive strategy to

retain customer base. Banks are trying to win customer satisfaction and loyalty by providing

better quality services. This study examines the relationship of service quality with customer

loyalty, commitment and trust from the customer’s perspective in the Indian banking sector. Data

was collected from 300 customers of public and private sector banks using structured interview

schedules. The results show that dimensions of service quality such as assurance-empathy,

reliability and tangibles significantly predict customer trust and commitment. The results also

indicate that service quality is positively associated with customer loyalty. Private bank

customers are more committed and loyal as they receive better quality of service.

2.7 User Perception of Retail Banking Services: A Comparative Study of Public and

Private Sector Banks:

6

Due to increasing competition in retail banking, understanding the customer perception about

service quality is becoming indispensable. The private sector banks are posing a very stiff

competition to the public sector banks through their initiatives for meeting customer expectations

and gaining a cutting edge. This is reflected by the increasing market share and better

profitability of private banks in comparison to that of public sector banks.

CHAPTER III

INDUSTRIAL & COMPANY PROFILE

3.1 INDUSTRAIL PROFILE

3.1.1 Banking Industry

Banking is an important element of economy’s Indian banking system overt past few decades, it

has played very effective role in mobilization of savings of the economy, spreading in banking

habit to the furthest corner of the country and large entrepreneurial base. Indian banks have

multiplied their activities in volume, variety and geographical base to meet the growing needs of

the society. The old methods and techniques replaced by new techniques of viability need based

formation of finance schemes and marketing. Instead of working for profits, they are required to

participate in nation building activities and help in bringing socio economic change.

Banks are new centre of trade, commerce and business in a country. Banking plays a very

important role in the economic development of all nation of the world. Industrial revolution took

place in the economic development of all nations of the world. Industrial revolution that took

place in European countries in 18th and 19th centuries would not have taken place without the

evolution of good banking system. Banking is life blood of modern commerce.

It is very important to study the concept of services as banks are categorized into service sector:

service as deeds, processes and performances. The service sector of an economy is going through

a period of almost revolutionary proportion in which established ways of doing business

continue to be shunted aside.

7

The banking system in India constitutes the core of the financial sector. It plays a significant role

in the process of economic growth of the country. Its efficiency and development thus are vital

for the country’s economic progress. Commercial banks are the hub of the Indian financial

system. Indian commercial banks are organized as the joint stock banks, both in the public sector

and private sector.

3.1.2 Public Sector Banks

Banking is one of the most important elements of economy. Indian banking system over past few

decades has played a very effective role in mobilization of savings of the economy spreading in

banking habit to the furthest corner of the country and enlarged entrepreneurial base. Indian

banks have multiplied their activities in volume variety and geographical coverage to meet the

growing needs of society, the old methods and techniques of viability growth based formation of

finance schemes of marketing. Instead of working for profits, they are required to participate in

the nation building activities and help in bringing socio-economic change.

Banking transactions carried on by any individual or firm engaged in providing financial services

to consumers, businesses or government enterprises. In the broad sense, a bank is a financial

intermediary that performs one or more of the following functions: safeguards and transfer of

funds, guarantees credit worthiness and exchange money. Such institutions as commercial banks,

central banks, organizational banks, trust companies, finance companies, life insurers and

investment bankers provide these services. A normal end mean common definition of a bank is a

financial intermediary that accepts, transfer and most important creates deposits. This includes

such deposits institutes as central banks, commercial banks, savings and loan associates and

mutual savings bank.

Banks are most frequently organized in corporate form and owned by either private individual,

government interests. Although non corporate bank that single proprietorship and partnership are

find in other countries since 1863 all federally chartered bank in the US must be corporations.

Only a few states permit formation of non corporate bank. All countries subject their banks,

however owned to government regulations and supervision, normally implemented by central

banks authorities. Bank in India should develop appropriate strategy and ensure proper

8

marketing strategy and mistaking into account the economic, cultural, legal and political

environment. As toady in the changes word the needs are changed as regards to bank as foreign

players.

Marketing concept should be followed where we talk about 4 Ps marketing tools in regards to

banks; we should include to more 2 Ps more, People and Procedures as well. An introduction of

ATM 24 hours online banking transactions etc their goal should not be of profit it should be

“growth and development with profit” The service sector of the economy is going through a

period of almost revolutionary proportions in which established ways of doing business continue

to be shunted aside. It has been said that the only person in the world who appreciates changes is

wet baby. The service sector can be best characterized by its diversity. Service organization

range in size from huge International Corporation in such fields as airlines, banking, insurance,

telecommunications, and hotel chain and freight transportation to a vast array of locally owned

and operated small business and numerous business to business services. As per the currently

defined government statistics, services account for the two third to three quarters of the gross

national product. Not only in US but also in many other highly develop industrial nations.

In the banking and financial services business, comprise many different types of businesses,

commercial and retail, with a common denomination, of being in business to help customer to

make or manage money. A high level of trust is implicit and is even more critical in the wake of

the savings and loan scandals of the 1980s.

The public sector banks largely dominate the Indian banking industry. These banks till early 90s

were involved in the traditional banking business of deposits and credit lending. They performed

a supporting role in the overall growth of economy. While most of these banks used to focus on

growth of balance-sheet profitability was not a significant competition. In most of the banks

government has holding of 100% whereas in the few banks the state has fallen because of public

issue in the post liberalization period. Some of other leading banks in the segment also proposed

to come out with an equity issue to raise further capital.

9

The public sector banks have a strong distribution network all over the country. But the strength

of earlier periods has now coming out with VRS to bring down number of employees and

improve their efficiency ratio. The public sector banks still control a major share in banking

operation of the country.

3.1.3 Private Sector Banks

The banking regulation act was amended in 1993 permitting the entry of new private sector

banks. The act also specified certain criteria for establishing new private sector banks. The

criteria are as follows:

The banks should have a minimum net worth of Rs. 1 billion

The promoters holding should be minimum 25% of paid up capital.

The last decade witnessed the maturity of India’s financial markets. Since 1991, every

governments of India took major steps in reforming the financial sector of the country. The

important achievements are as follows:

3.1.4 Financial Markets

In the last decade, private sector banks/institutions played an important role. They grew rapidly

in commercial banking and asset management business. With the openings in the insurance

sector for these institutions, they started making debt in the market.

3.1.5 Regulators

The Finance Ministry continuously formulated major policies in the field of financial sector of

the country. The Government accepted the important role of regulators. The Reserve Bank of

India (RBI) has become more independent. Opinions are also that there should be a super-

regulator for the financial services sector instead of multiplicity of regulators.

3.1.6 The Banking System

Almost 80% of the business is still controlled by the Public Sector Banks (PSBs). PSB are still

dominating the commercial banking system. Shares of the leading PSBs are already listed on the

10

stock exchanges. The RBI has given licenses to new private sector banks as part of the

liberalization process. The RBI has also been granting licenses to industrial houses. Many banks

are successfully running in the consumer segments, industrial finance, retail trade, small business

and agriculture finances.

3.1.7 Overall Approach to Reforms

The last ten years have seen major improvements in the working of various financial market

participants. The government and the regulatory authorities followed the step by step approach,

not a bang one. The entry of foreign banks has assisted in the introduction of international

practices and systems. On the whole, the cumulative effect of the developments since 1991 has

been quite encouraging.

3.1.8 Deregulation of Banking System

In order to reach the stipulated capital adequacy norms, substantial capital were provided by the

Government and RBI. Government pre-emption of banks’ resources through statutory liquidity

ratio (SLR) and cash reserve ratio (CRR) brought down in steps. Interest rates on the deposits

and lending sides almost entirely were deregulated.

New private sector banks allowed promoting and encouraging competition. PSBs were

encouraged to approach the public for raising resources. Recovery of debts due to banks and the

Financial Institutions Act 1993 were passed, and special recovery tribunals set up to facilitate

quicker recovery of loan arrears.

3.1.9 Consolidation Imperative

Another aspect of the financial sector reforms in India is the consolidation of existing institutions

which is especially applicable to the commercial banks. In India the banks are huge quantity.

First, there is no need for 27 PSBs with branches all over India. A number of them can be

merged. The merger of Punjab National Bank and New Bank of India was difficult one, but the

situation is different now. No one expected so many employees to take voluntary retirement from

PSBs, which at one time were much sought after jobs. Private sector banks will be self

11

consolidated while co-operative and rural banks will encouraged for consolidation, and anyway

play only a niche role.

Global Competencies

The progress and growth of Indian banking sector is in the line with the twin objective of

financial stability and growth. Banking in India has increased its size by capitalizing on all the

business opportunity available. The capital adequacy ratio of Indian banks has increased and is

now in a much better position in relation to the other emerging market economies. The ratio is

well in line with the proposed new Basel norms. Several banks raised capital and some more

banks are on the way.

Guidelines and Governance

Meeting capital adequacy norms in the recent times gained importance with the deadline for the

implementation of Basel II Accord approaching closer. The average Capital Adequacy Ratio

(CAR) of Indian banks stood at 12.8% at March 31, 2005, much above the prescribed norms. In

order to enhance capital adequacy ratio, seven banks including ICICI bank and Punjab National

bank, have raised capital in primary markets to the tune of Rs.12, 000 crores during the year

2005. it has been decided that banks which have maintained capital at least 9% of the risk

weighted assets for both credit risk and market risks of both ‘Held For Trade’(HFT) and

‘Available For Sale’(AFT) categories as on March 31, 2006, would be permitted to treat the

entire balance in the Investment Fluctuation Reserve as tier-I capital. Reserve bank Of India

(RBI) has given guidelines to have minimum net worth of Rs. 300 crores for private banks. New

guidelines have been introduced in the Indian banking system to measure up to the international

banking practices. The Indian Bankers Association (IBA) has come up with ‘Fair Practices

Code’ to improve corporate governance. Banks in India should now explicitly state their

governance philosophy in their Annual Reports as part of ‘Notes on Accounts’ to their balance

sheets.

Emphasis has been placed on the role of bank boards. In a move to give freedom in the

functioning of private banks, RBI has withdrawn its nominee directors from almost all the

private sector banks. Amendments have also been proposed to remove the provisions of having

12

nominated officers of RBI in public sector banks in order to bring their functioning at par with

private banks.

Government’s shareholding in several Public Sector Banks (PSBs) reached close to 51%. To

continue government’s stipulated minimum shareholding in PSBs, the finance ministry asked the

RBI to come up with the guidelines on ‘hybrid’ instruments, which can be treated as capital.

Performance

The year 2005 has been good for the Indian banking. There was robust growth in credit flow

during the year. Credit deposit ratio increased by more than 10% and substantial part of the

bank’s commercial credit went to large borrowers at sub-PLR rates. Government wants to further

push up the loan to GDP ratio from 43% to 50%. The most significant jump in credit was to real

estate sector. Credit to agriculture has been in line with the government’s objective of doubling

its credit in the coming five years.

The banking industry has managed to improve its operating profit ratio by reducing its operating

costs/staff expenses. The asset quality in Indian banking sector has shown considerable

improvement. The gross Non Performing Assets (NPAs) to advances ratio for the sector declined

to 5% in FY05 from 16% in FY97. The Indian banking has improved efficiency in its operations.

Cost to income has come down. Interest income of the entire banking sector has increased. The

return on assets from the foreign banks has been highest, followed by the private sector banks.

Revenue sources of banks been diversified. They have entered into the business of selling third-

party products to increase their income. Banks are trying to increase fee-based income as interest

income continues to be under pressure and profits from tradi8ng keep declining.

Investments in Statutory Liquidity Ratio (SLR) securities of banks have declined; however, the

ratio is in excess of the statutory limit. RBI reduced the reverse repo rate during the year to direct

the funds to the needed areas. Most of the investments held by private sector banks were in the

maturity bucket of a less than a year while the public sector banks’ investments were ranging

from one-year to five-year maturity buckets. At the same time, technological development in the

sector helped the banks in diversifying their business activities to offer different services to

13

customers. Introduction of core banking solutions has enabled the banks to segregate the credit

sourcing (front office) and appraisal (back office) functions.

Merger and Acquisitions

The banking industry we saw some consolidation during the year. There was the reverse merger

of IDBI with IDBI Bank, and Centurion Bank of Punjab was created through the merger of Bank

of Punjab with centurion Bank and again Centurion bank of Punjab merger with HDFC Bank.

SBI has a network of 60 overseas offices spread over 29 countries. The bank has acquired 76%

stake worth $6 million in closely held PT Bank IndoMonex, securing a foothold in Indonesia,

and a similar stake in Kenya’s Giro Commercial Bank ltd. In February 2005, it acquired a 51%

of the Mauritius based Indian Ocean International Bank Ltd. And it also gained permission to set

up branches in Saudi Arabia. It has also merged its subsidiary-IndoNigerian Bank-with a local

bank, Nal Bank. The SBI has also stated to start its retail business in Shanghai later this year.

ICICI Bank in a span of just four years has emerged as retail banking. The bank in order to

increase its presence overseas has acquired a Russian bank, InvestitsionnoKredimy Bank, also

aims to take advantage of increased presence of the Indian corporate in Russia and South Africa.

The bank is also planning to make Bahrain its hub especially for trading in commodities. It has

emerged as the largest seller of bad loans to the Asset Reconstruction Company of India.

Punjab National Bank will shortly be converting its representative offices in London into a

subsidiary unit. PNB is in the process of initiating internal discussions to plan and identify

acquisition of banks overseas. PNB has targeted to disburse loans to the tune of Rs. 8,000 crores

in retail segment by the end of this fiscal as against the total retail loan disbursement of Rs. 6,500

crores during the last fiscal.

3.1.4 Way Forward

The future of banking sector looks bright. A few more Indian banks are interested in starting

overseas operations, either by starting by starting their representative offices of by the opening

branches abroad. Till October 2005, 14 Indian banks had overseas operations spread across 42

countries. Apart from global expansion, banks will also augment their domestic lending to

14

agriculture as per the government directions. Banks started designing new programs such as ‘No

frills’ accounts to reach a large number of customers in rural areas where they can maintain zero

balance. Several banks have already started this ‘no frills’ accounts.

As more and more infrastructure projects are expected to come up, banks will find themselves

increasingly invested in that sector. The share of equity as funding route for companies is bound

to grow as capital market looks growing and number of new public offerings is rising. Banking

sector is expected to raise the funds to the tune of Rs. 600 billion over the next five years to push

up the loans to GDP ratio. Several banks including Central Bank, Union Bank, Bank of India and

South Indian Bank plan to hit the primary market to comply with capital requirement norms.

Dena Bank that raised the capital last year is expected to hit the capital market again this year.

The increase in ratios such as Credit Deposit Ratio and Capital Adequacy Ratio and decrease in

Gross NPAs to deposits indicate that banks would improve their financial position in future. As

economy is set to grow at a healthy rate, more and more infrastructure development is set to take

place, and Indian banking sector is expected to play an important role in the same.

History

The origin of modern banking in India dates back to 1770 when the first joint-stock bank, named

Hindustan Bank, was started by the English Agency House of Alexander & Co. Calcutta. The

bank was, however wound up in 1832.

The real growth of modern commercial banking began in the country when the government was

awakened to the need for banks in 1806 with establishment of the first Presidency bank, called

the Bank of Bengal, in Calcutta in that year. It leads to the establishment of two other Presidency

Banks, namely the Bank of Bombay in 1840 and the Bank of Madras in 1843. To each of these

banks, the government had subscribed Rs. 3 lakhs to their share capital.

These three Presidency Banks continued till 1920. In 1921 they were amalgamated into the

Imperial Bank of India. In 1935, the British Government in India had started a central bank

called the Reserve Bank of India as a private sector bank. After independence, eventually by

15

passing reserve Bank of India Act, 1949, the Reserve Bank of India was taken over by the

government of India as a state owned central bank.

After independence, the Government of India launched economic planning in the country since

1951. On July 1, 1955 the Government of India nationalized the Imperial Bank of India and

converted it into the State Bank of India. The establishment of the State Bank of India was a

pioneering attempt in introducing public sector banking in the country. Later on in 1959-60

seven subsidiary State banks were also nationalized to form the SBI group. The SBI group has

the laudable objective of bringing rural orientation in Indian banking, which it achieved with

remarkable success.

Eventually, on July 19, 1969 fourteen major Indian scheduled banks (with deposits of over

Rs.50 crores) were nationalized by the government with a view to serve better the needs of

development of the economy in conformity with national priorities and objectives. As a result, 85

percent of the baking business in terms of deposits was brought under public control.

On April 15, 1980, six more Indian scheduled banks (with deposits of over Rs.200 crores) were

nationalized. As such, over 90 percent of the banking activity in the country is brought into the

public sector. In short, nationalization of banks implied a bold and major economic step in the

process of banking reforms in the country. It has resulted in the evolution of public sector

banking.

16

3.2 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 liberalization of the Indian Banking Industry. The bank was

incorporated in August 1994 in the name of HDFC Bank Limited, with its registered office in

Mumbai, India. The bank commenced operations as a Scheduled Commercial Bank in January

1995.

3.2.1 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 the clear market leader in

mortgages and banking services in India. Its outstanding loan portfolio covers 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.

3.2.2 Business Focus

HDFC Bank's mission is to be a World Class Indian Bank. The Bank's aim is to build a sound

customer franchise across distinct businesses so as to be the preferred provider of banking

services in the niche segments that the bank operates in and to achieve healthy growth in

profitability, consistent with the bank's risk appetite. The bank aims to ensure the highest level of

17

ethical standards, professional integrity and regulatory compliance. HDFC Bank's business

philosophy is based on four core values: Operational Excellence, Customer Focus, Product

Leadership and People. The Bank signed a strategic business collaboration agreement with

Chase Manhattan Bank in February 1999.

3.2.3 Capital Structure

The authorized capital of HDFC Bank is Rs.450 crores. The paid-up capital is Rs.281.2 crores.

The HDFC Group holds 24.5% of the bank's equity while about 13.3% of the equity is held by

the depository in respect of the bank's issue of American Depository Shares (ADS/ADR Issue).

The Indian Private Equity Fund, Mauritius (IPEF) and Indocean Financial Holdings Ltd.,

Mauritius (IFHL) (both funds advised by J P Morgan Partners, formerly Chase Capital Partners)

together hold about 11.6% of the bank's equity. Roughly 18% of the equity is held by FIIs,

NRIs/OCBs while the balance is widely held by about 300,000 shareholders. The shares are

listed on the Stock Exchange, Mumbai and the National Stock Exchange. The bank's American

Depository Shares are listed on the New York Stock Exchange under the symbol "HDB".

3.2.4 Times Bank Amalgamation

In a milestone transaction in the Indian banking industry, Times Bank Limited (another new

private sector bank promoted by Bennett, Coleman & Co. /Times Group) was merged with

HDFC Bank Ltd., effective February 26, 2000. As per the sc1.heme of amalgamation approved

by the shareholders of both banks and the Reserve Bank of India.

Shareholders of Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times

Bank. The amalgamation added significant value to HDFC Bank in terms of increased branch

network, expanded geographic reach, enhanced customer base, skilled manpower and the

opportunity to cross-sell and leverage alternative delivery channels.

3.2.5 Distribution Network

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

branches spread over cities all across the country. All branches are linked on an online real-time

18

basis. Customers in 39 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. Being a clearing/settlement bank to various leading stock exchanges,

the Bank has branches in the centre where the NSE/BSE has a strong and active member base.

The Bank also has a network of almost over networked ATMs across these cities. Moreover,

HDFC Bank's ATM network can be accessed by all domestic and international Visa/MasterCard,

Visa Electron/Maestro, and Plus/Cirrus and American Express Credit/Charge cardholders. It is

the only bank in India which provides access to all the 3 major International Card Networks on

its ATM network.

3.2.6 Management

Mr.Jagdish Kapoor took over as the bank's Chairman in July 2001. Prior to this,

Mr.Kapoor was a Deputy Governor of the Reserve Bank of India.

The Managing Director, Mr. Aditya Puri, has been a professional banker for over 20

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 and commercial banking. Senior executives

representing HDFC and J P Morgan Partners (formerly Chase Capital Partners) 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. 

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3.2.7 Technology

HDFC Bank operates in a highly automated environment in terms of information technology and

communication systems. The entire bank's branches have connectivity which enables the bank to

offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to

retail customers through the branch network and Automated Teller Machines (ATMs).

The Bank has made substantial efforts and investments in acquiring the best technology available

internationally, to build the infrastructure for a world class bank. In terms of software the

Corporate Banking business is supported by Flex cube, while the Retail Banking business by Fin

ware, both from I-flex Solutions Ltd. (formerly Citicorp Information Technology India Ltd.).

The systems are open, saleable and web-enabled.

The Bank has prioritized its engagement in technology and the internet as one of its key goals

and has already made significant progress in web-enabling its core businesses. In each of its

businesses, the Bank has succeeded in leveraging its market position, expertise and technology to

create a competitive advantage and build market share.

BUSINESS PROFILE

HDFC Bank caters to a wide range of banking services covering Commercial and Investment

banking on the wholesale side and transactional / branch banking on the retail side.

The bank has three key business areas:-

Wholesale Banking Services

The Bank's target market is primarily large, blue-chip manufacturing companies in the Indian

corporate sector and to a small extent, emerging mid-sized corporate. For these corporate, the

Bank provides a wide range of banking services, including working capital finance, trade

services, transactional services, cash management, etc. 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 corporate including multinationals, companies

20

from the domestic business houses and prime Public Sector companies. It is recognized as a

leading provider of cash management and transactional banking solutions to corporate

customers, mutual funds, stock exchange members and banks.

Retail Banking Services

The objective of the Retail Bank is to provide a full range of financial products and banking

services, giving the customer a one-stop window for all his banking requirements. The products

are backed by world class service and delivered to the customers through various delivery

channels including the branch network, as well as 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 Loans against shares, Auto Loans, Personal Loans and Loans for

Consumer Durables and Two-wheelers. It is also a leading provider of Depository Participant

(DP) services for retail customers. 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 debit card allows the user to directly debit his account at the

point of purchase at a merchant establishment, in India and overseas. The Bank launched its

credit card in association with VISA in November 2001. 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 Operations

Within this business, the bank has three main product areas - Foreign Exchange and Derivatives,

Local Currency Money Market & Debt Securities, and Equities. With the liberalization of the

financial markets in India, corporate 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.

21

Rating

HDFC Bank's program me for Certificates of Deposits has been rated by the Indian rating agency

Credit Analysis & Research Ltd. (CARE). The CDs are rated PR 1+ is the highest rating for

short term instruments indicating superior capacity for repayment.

3.3 PRODUCT RANGE

Savings, Fixed Deposits, Current and Demat Accounts Savings Account: Apart from the usual

facilities, you get a free ATM Card, Interbank banking, Net Banking, Bill Pay, Phone Banking,

Debit Card and Mobile Banking, among others.

HDFC Bank Preferred:

A preferential Savings Account where you are assigned a dedicated Relationship Manager, who

is your one-point contact. You also get privileges like fee waivers, enhanced ATM withdrawal

limit, priority locker allotment, free Demat Account and lower interest rates on loans, to name a

few.

Sweep-In Account:

A fixed deposit linked to your Savings Account. So, even if your Savings Account runs a bit

short, you can issue a cheque (or use your ATM Card). The money is automatically swept in

from your fixed deposit into your Savings Account.

Super Saver Account:

Gives you an overdraft facility up to 75% of your Fixed Deposit. In an emergency, you can

access your funds while your Fixed Deposit continues to earn high interest.

HDFC Bank Plus:

Apart from Regular and Premium Current accounts we also have HDFC Bank Plus, a Current

Account and then some more. You can transfer up to Rs. 50 lakh per month at no extra charge,

between the four metros. You can also avail of cheque clearing between the four metros, get cash

22

delivery/pickup up to Rs. 25,000/-, home delivery of Demand Drafts, at-par cheques, outstation

cheque clearance facility, etc.

Demat Account:

Conduct hassle-free transactions on your shares. You can also access your Demat Account on the

Internet.

Phone Banking:

24-hour automated banking services with 39 Phone Banking numbers available.

ATM 24-hour banking:

Apart from routine transactions, you can also pay your utility bills and transfer funds, at any of

our ATMs across the country all year round.

Intercity/Inter branch Banking:

Access your account from any of our branches in cities.

Net Banking:

Access your bank account from anywhere in the world, at anytime, at your own convenience.

You can also view your Demat Account through Net Banking.

International Debit Card:

An ATM card you can shop with all over the country and in over 140 countries with. You can

spend in any currency, and pay in Rupees.

Mobile Banking:

Access your account on your mobile phone screen at no airtime cost. Use SMS technology to

conduct your banking transactions from your cell phone.

Bill Pay:

Pay your telephone, electricity and mobile phone bills through our ATMs, Internet, phone or

mobile phone. No more standing in long queues or writing cheques.

23

Personal Loans:

Take a loan of up to Rs. 3 lakh for a wedding, education, purchase of a computer or an exciting

holiday.

New Car Loans and Used Car Loans:

Finance up to 90% of the cost of a car, new or used! And the loans come to you with easy

documentation and speedy processing at attractive interest rates.

Types of Account

Salary Account

Saving Account

Current Account

Fixed Deposit

Demat Account

Safe Deposit Account

A) SALARY ACCOUNT :

There are three type of product code in salary account product code 105 is basically employees

of the govt. department & product code 115 is only defense person and product code 120 is any

private organization/department .If product code 120 account holder wants to a debit card then

they have to paid Rs.100 per annum

Product Code Average Salary No. of Employee Provide Facility

105 7500 10 Free Debit card

115 Up to 5000 10 Free Debit card

24

Only defense

120 5000 10 Free ATM

Table 1- SALARY ACCOUNT

Costumers have always given their best to the nation. It’s now HDFC BANK turn to provide

costumer with the best salary account. With HDFC Bank’s Salary Account, costumer receives an

array of rewards with their monthly pay.

Their employees get privileged services that help them achieve even more

Direct Salary Credits – Their employee need not go to the bank ,deposit their cheques and

wait for it to be cleared .Their salary is automatically credited to their accounts

Interbank/Intercity Banking at 142 branches and over 360 ATMs

No minimum Balance to be maintained in the account to avail of these benefits

Interbank/Intercity Banking: - Costumer can use any of HDFC BANK branches/ ATMs across

111 cities in India, no matter where their account is held e.g. costumer may open their account in

Pune and can operate this \account the next time costumer travel to Bangalore or for that matter

from any other city. Also no need to open a new account when costumer gets transferred to

another city where HDFC BANK has a branch.

ATM 24-hour Banking: -

Over 675 ATMs across 111 cities enable costumer to withdraw up to Rs.15, 000 a day.

Free International Debit Card: -

It’s like an ATM Card that costumer can shop with and make payments at 25,000 outlets in India

and 10 million worldwide. Costumer can also withdraw money from over 5.6 lakh

Maestro/visa/Plus/cirrus ATMs, in 140 countries. HDFC BANK also waives the annual fee for

one additional card per account for the first year.

Free Demand Drafts:

Customers can avail of free demand drafts up to Rs.25, 000/- per instrument payable at any city

where HDFC BANK have branches.

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Free Phone Banking: -

This 24- hour’s facility enables customer to conduct a range of banking transactions with just a

call.

Free net Banking: -

Customer can now bank at the click of a mouse, backed by the highest level 128-bit security.

Free Mobile Banking: -

Customer can even conduct a range of banking transactions over a mobile phone, using SMS

facility or a WAP activated phone.

Free Personalized Cheque Book: - their employees get personalized cheque book with the

name of the account holder printed on the cheque leaves.

1. Special features for the Defense person

Sweep-in Account: -

This facility is a fixed deposit linked to savings account. So even if funds are short in the savings

account, that entire customer has to do is just issue a Cheque. The money is automatically swept

in from the fixed deposit into the savings account. The balance amount continues to earn high

interest rate.

Super Saver Account: -

This account gives customer an overdraft facility of unto 75% of the Fixed Deposit in times of

emergency. Customer can access their funds either through an ATM or by issuing a cheque,

while the Fixed Deposit continues to earn high interest rate.

Free Collection of Outstation Cheques:

This account entitles customer to free collection of outstation cheques drawn on all cities where

HDFC BANK has branches.

2. How else do customer benefit from HDFC Bank’s Salary Account?

26

With HDFC BANK Salary Account, customer enjoys a number of privileged value added

services such as:

Direct Salary Credits: -

Customer salary is automatically credited to their account. All customer have to do is inform

their payroll department of their HDFC Bank Salary Account number.

Bill Pay:

No more waiting in queues to pay utility bills – customer can use any of HDFC BANK “e-Age”

banking channels like Phone Banking, Net Banking, Mobil Banking and ATMs to pay their

electricity, telephone and mobile phone bills, and even LIC premiums.

Insurance

In case customer card is lost/stolen, customers are covered for any liability exceeding Rs. 500/-

(After customer report the loss to the Bank). Please report of their card immediately to HDFC

BANK Phone Banking service. Additionally, customer must report the loss/theft of their card to

the nearest police authorities and forward a copy of the acknowledged report to the Bank.

Additional Card

Additional cards are available to Joint Account holders at an Annual fee of Rs. 100 per card.

However, the operating instructions on the account should allow for financial transactions to be

conducted singly by the Joint Account holders. Annual fee has been waived for the first year on

one Additional Card.

The services and applicable tariffs are listed below:

Service offered Charges

Lost/Stolen Card Reporting USD 35 per card

Emergency Cash Disbursement USD 175 per disbursement + USD 25 per

disbursement only in cases where

emergency cash is disbursed by Visa

27

through a member.

Miscellaneous Customer Service enquiries USD 5 per call

Table 2- Additional Card Details

Worldwide Assistance from MasterCard if customer has a Maestro Debit Card

In case customers have any queries/problems while traveling abroad, assistance is available from

Maestro Global Service from MasterCard International.

The services and applicable tariffs are listed below:

Table 3- Worldwide Assistance from MasterCard if customer has a Maestro Debit Card

Important

Please sign on the reverse of the card on the signature panel.

Their personal Identification Number (PIN) will be mailed to customer separately. Please

ensure that customer receive this after customer receive their card. In case customers do not

receive it please contact the nearest branch or call Phone Banking.

Master Cards are being issued in select cities only.

Their Card is valid in India and abroad. Customer cannot make foreign currency transactions

in Nepal and Bhutan (i.e. transactions in currencies other than local currency of Nepal /

Bhutan or Indian Rupees).

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Services Offered Charges

Lost/Stolen Card Reporting US$ 35

Emergency Cash Disbursement US$ 95

Miscellaneous US$ 7.75

In case of multiple accounts linked to their card, all their transactions at Merchant Outlets,

Visa/PLUS ATM and Cirrus ATM locations will access one account i.e. the Primary

Account Number designated by customer.

The four-digit PIN helps customer to access their accounts. Do not reveal their PIN to

anybody. Only customer should know this number.

Please ensure that while using the Card outside India customer are doing so strictly in

accordance with RBI’s Exchange Control Regulations, as prevailing from time to time. Their

aggregate expansive incurred abroad (i.e. through payments in cash/traveler’s cheques and

through the Car) should not exceed the limit, set by RBI,

B) SAVINGS ACCOUNT

The e-Age Saving Account from HDFC Bank brings customer a comprehensive range of

products and services. Each one is designed to minimize their effort, making it much simpler for

you to do their banking. HDFC BANK now has 211 branches in 110 cities and over 650 ATMs

across the country. Add to this an international network of over 6.5 lakh ATMs which customer

can access with their international Debit Card. That’s world class banking for customer.

Free 24 hour ATM: -

Customer can withdraw up to Rs. 10,000 per day from any of HDFC BANK extensive network of

over 650 ATMs across 110 cities all over the country. Customer can also deposit cash/cheques,

get an account balance, request for a cheque book and transfer funds, all at the push of a few

buttons. This amazing facility is available 24 hours a day 365 days a year.

Rs. 15,000 per day with their Debit Card.

Free Net Banking: -

HDFC BANK convenient Net banking facility will open up a whole amount of services for

customer at just the click of a mouse. Customer can:

Check their up to the minute account balance etc.

Open a Fixed Deposit.

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Get a Demand Draft

Make a TDS inquiry

Request a stop payment on a cheque

Transfer funds within their own accounts

Carry out third party Transfer of funds

International Debit Card:

The HDFC Bank international Debit Card lets customer shop and also withdraws money from

HDFC BANK ATM network. With HDFC BANK’S international Debit Card, customer can shop at

18,000 establishments in India and over 100 Lakh establishments in 140 countries. Customer can

also withdraw cash from over 1600 VISA/Plus ATMs in India and 605 Lakh ATMs in 140

countries. The amount customer spend on their card will be automatically debited from their

Savings Account. So when customer go shopping customer don’t have to carry cash!

Interbank /Intercity Banking:-

Customer can access their account from any of the 211 branches in 110 cities and over 650

ATMs across the country. So customer can withdraw cash from another branch, through a self-

cheque or an ATM. Customer could also transfer funds between two accounts, or deposit a local

cheque in one branch and get is credited to their account in another city.

Bill pay:-

Now for the first time ever, customer gets an absolutely unique facility for paying their

telephone, electricity, cellular phone bills and insurance premium at the push of a few buttons.

Pay utility bills using the ATM, the Internet, and Telephone of mobile phone.

Free Phone Banking: -

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HDFC Bank’s 24 hour Phone Banking service lets customer conduct a wide range of banking

transactions from the comfort or their home of office.

Customer can:-

Get their account details

Ask for a cheque book or a statement

Open a Fixed Deposit

Transfer money within their own accounts

Order a Demand Draft

Stop cheque payment.

C) CURRENT ACCOUNT

AT HDFC Bank, HDFC BANK understand that running a business requires time and money, also

that their business needs are constantly evolving. That’s where HDFC BANK comes in. HDFC

BANK provides customer with a choice of Current Account options to exclusively suit their

business whatever the size scope.

Take Customer’s pick!

Customer can choose the Current Account that works best for their specific business needs.

1. Regular Current Account

The regular Current Account requires an average quarterly balance of Rs.10, 000 only. Besides

the free ATM card and easy accessibility, their first 50 cheque leaves are offered free.

2. Premium Current Account

Their account can be operated from any of the branches for the depositing of withdrawing

money. A Premium Current Account requires an average balance of only Rs. 25,000 per quarter.

Moreover, for premium Current Account holders cheque leaves are free.

Free Services offered to Regular and premium current Account holders:

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One ATM card per account (only for individuals/Sole Proprietorships).

Replacement in case of damaged cards.

Monthly statement.

Online, real-time Net Banking.

24 hours Phone Banking access (please check for availability in their city,).

3. HDFC Bank Trade

It is a Current Account ideal for small funds transfer across various cities in the country. Trade

Account is suitable for small businessmen and traders.

Features offered to HDFC Bank Trade Account holders:-

As par payable cheques.

Free inter-city Funds Transfers up to Rs. 25 lakhs.

Free Pay Orders

Free Demand Drafts Payable on HDFC Bank locations up to 30 per quarter. (Check with

branch for value limits).

ATM card for individuals/Sole Proprietorships. Free online, real time Net Banking.

24-hour Phone Banking access (please check for availability in their city).

4. HDFC Bank Plus

Single Account, Multi-city Banking

If their business regularly requires customer to receive and send funds to various cities in the

country, HDFC Bank Plus provides customer with the means to facilitate such transactions

efficiently.

With just one account, customers have access to more than 111 cities in the country. In other

words, the power of a single account and multi-city banking. This results in huge savings on

inter-city movement of funds and other service charges.

32

Furthermore, HDFC BANK strategic alliance with Chase Manhattan Bank gives customer the

advantage of competitive rats for trade finance and faster inward/outward remittances. The

average balance requirement for the HDFC Bank Plus account is Rs. 100,000 per quarter.

D) FIXED ACCOUNT

Would not it be great to earn a high interest on their Fixed Deposit and at the same time enjoy

the liquidity associated with a saving account/ Get their self the HDFC Bank Super Save

Account and that’s exactly what customer will have.

How do I benefit from the Super save Account?

Maximum Liquidity

Their Super Saver Account allows customer to issue cheque and use and ATM card for

withdrawals, just like Savings Account. Customer can access their account from any of HDFC

bank 211 branches or over 650 ATMS spread across India. Even in an emergency, customer

need not break their fixed Deposit to withdraw money. So customers get their money whenever

customers need it.

Easy operation

Customer can open a supersaver Account with nominal sum of just Rs. 25,000 and enjoy a

temporary withdrawal limit of up to 75% of their deposit .Even after customer withdraw a part of

their limit, their entire deposit continues to earn a high rate of interest, i.e. their deposit in not

broken. Customer are required to pay an overdraft interest that is 2% more than the interest

earned by their Fixed Deposit for the amount of overdraft, and only for the period for which

33

customer use the money. Besides, customer can take an overdraft by simply using a cheque of

through an ATM.

Free ATM Card

With every Super saver Account customer get a free ATM Card. This allows customer to enjoy

24 hour banking 365 days a year, including Sundays sand bank holidays. Their convenience is all

the matters.

E) SWEEP IN ACCOUNT

Imagine having an account that changes to suit their needs. When customer want their money to

earn high interest it worked like a Fixed Deposit, when customer want to withdrew money in a

hurry, it works like a savings Account. Customer wins both ways

So what is a Sweep-in Account?

It is a Fixed Deposit that comes automatically linked to a savings Account. So whenever

customer’s short of funds in their Saving account and their money is “blocked” in a fixed

Deposit, customer just have to issue a cheque (or use the ATM.) their money automatically gets

transferred, i.e. swept-in from their fixed Deposit into their Saving Account. It’s as easy as it

sounds. To open a sweep in Account, all customer need is to open a Fixed Deposit as per the

norms of the bank and a Savings Account with no minimum balance requirement.

Customer need to maintain a minimum fixed Deposit of Rs, 50,000 at all times to avoid service

charges. In case of non maintenance of Rs.50, 000 in fixed deposits, customer savings Account

will be subject to service charges as applicable. The saving account needs to be opened with an

initial amount of Rs.5000.

How does it work?

34

Since the Sweep in Account holds their money in a Fixed Deposit in units of Rs.1 every time

money is swept from their fixed deposit to their Savings account, interest loss in minimized.

Further, the amount swept in earns interest for the tenure that it has completed without any

penalty. The rest of their deposit continues to earn the original interest rate till maturity.

And the Sweep in automatically chooses the oldest deposit first before sweeping money into

their Savings Account. Enjoy the benefits of a truly flexible fixed Deposit. Just open a Sweep in

Account. The Savings accounts comes with it.

F) DEMAT ACCOUNT

Now customer can avoid mutilation, duplication and pilferage of share certificates. Open a

Demat Account with HDFC Bank and protect their securities from damage loss and theft and

remember, HDFC Bank is the largest depository participant amongst all banks.

Why do I need Demat Account?

With SEBI making trading mandatory in the Demat form and the advent of Rolling Settlements

it is imperative that all investors have a Demat Account with a depository participant. When

customer places a buy order, a seller can deliver the securities in Demat form, which can only be

credited to a Demat Account.

What benefits do I get from an HDFC Bank Demat Account?

No Account Opening Charges.

Nominal Annual Maintenance Charges.

Competitive fees for transactions.

Demat Account Status on the internet.

Option to open a Demat Account with NSDL, CDSL or both.

Personalized instruction Book.

35

What other benefits do I get?

Paperless trading which will help prevents mutilation. Loss and misplacement of certificates

and eliminate the problems of bad delivery.

Safety of their securities with HDFC Bank.

Problems of bad delivery, theft or mutilation eliminated.

Zero stamp duty.

Faster settlements of buy and sell orders, direct credit of allotment from public/ rights/bonus

issues.

How do I open an HDFC Bank Demat Account?

Fill up the application form and the Agreement and get it signed by the entire applicant.

Attach one photograph of each applicant.

Provide proof of identity/Residence (copy of ration card/ driving license/voters ID/passport

or PAN card). Please bring the original to the bank along with a photocopy.

Annual charges of Demat account Rs.299 per annum

Once their Demat account is active, customer will receive periodic account statements from

HDFC Bank. HDFC bank’s Demat Account is also accessible on the internet, allowing customer

to check balances, transaction status, Demat status etc. online.

SERVICE STRATEGY OF THE HDFC BANK

HDFC bank aims at full customer satisfaction its customers range from ordinary household to

high profile business houses. It has wide range of type of account and several other payment and

deposition facilities to cater to the need of these customers for speedy transaction to match the

demand of e-commerce .It has several model facilities like internet banking, telebanking etc. All

the cheques presented to HDFC bank are accounted within a day where drawee branch is in the

same city for out station cheques it takes maximum three days only. It has a team of dedicated

36

motivated & trend professionals who listen to and sort out the problems of customers. To avoid

long queue and waiting lines it has avoid network of reliable ATMs throughout the country .The

Merits of both Orthodox and electronic banking. Thus HDFC Bank not only tries to satisfy its

customers but also make all attempts to delight them.

HDFC Bank has three pronged services strategy:

People management

Physical Environment Management

Process Management

People Management

HDFC Bank has well qualified team of professional team of professionals who are

experts in customer relationship management. They have achieved. Thus level of

expertise through training and motivation program taken up at regular intervals because

of this high levels of competence HDFC Bank is often of called as Indian Foreign Bank.

Physical Environment Management

Every Branch and ATM’s of HDFC Bank is located in the posh area of the

locality it helps the bank to create a good image among customer.

Further it helps customers access the bank facilities in leisure time that is while

marketing or on way to some important destination.

Further all ATMs and branches are fully air conditioned with relaxing

environment which puts visitors at ease the peaceful hesitate the tension and

stores of customers.

Process Management

HDFC Bank has simplified procedures for transaction and opening accounts it has done

away with Hussle of Gvasenter which are mandatory in many in many banks similarly

it has done away with many lumbers one and non essential procedures which helps

customers reduce stress and under tension.

37

CHAPTER IV

RESEARCH METHODOLOGY

4.1 OBJECTIVE

To identify the factors, which are contributing for the Current Account & Saving Account

inactivation

To study the customer preference and expectation towards HDFC Current Account &

Saving Accounts.

To study the comparative analysis for Current Account & Saving Account Mix (Current

Account & Saving Account).

Suggest to improving the Current Account & Saving Account operation in the HDFC

Bank.

4.2 RESEARCH METHODOLOGY

A questionnaire was prepared to gauge the awareness of HDFC Bank in Retail banking

sector.

Survey has been done in and out of the bank covering a wide cross-section of the society.

38

The question was presented in one to one interview with each of the respondents.

Responses of the question had been thoroughly analyzed.

Conclusions had been arrived at using the response of the questionnaire

4.3 H YPOTHESIS

A hypothesis is a proposed explanation for an observable phenomenon. He null hypothesis

typically proposes a general or default position, such as that there is no relationship between two

measured phenomena. It is typically paired with a second hypothesis, the alternative hypothesis,

which asserts a particular relationship between the phenomena. Hypothesis testing works by

collecting data and measuring how probable the data are, assuming the null hypothesis is true. If

the data are very improbable (usually defined as observed less than 5% of the time), then the

experimenter concludes that the null hypothesis is false. If the data do not contradict the null

hypothesis, then no conclusion is made. In this case, the null hypothesis could be true or false;

the data give insufficient evidence to make any conclusion.

4.4. TYPE OF RESEARCH

Descriptive research

4.5 DATA COLLECTION

In this study the data collected from both primary and secondary data.

Primary data

Data is collected through questionnaire

Secondary data

Data is collected through

Bank Database Fin ware, HDFC Website.

Books, magazines and newspapers.

Reports and publications of various associations connected with industry.

Internet

39

4.6 SAMPLING SIZE

Area of sampling is Bangalore only. The sample size is 100 which include all between age

group 18-60 years with minimum qualifications required to be an advisor in the company.

4.7 METHODOLOGY FOR THE ANALYSIS

Percentage analysis

Chi square test to test the hypothesis

4.8 LIMITATIONS

Sometimes Respondents gave biased information.

The research conducted is limited to the Sarjapur Road branch of HDFC Bank, Bengaluru

due to time limit.

As the project is prepared for the academic purpose only, it suffers from the limitation of

time.

40

CHAPTER – V

DATA ANALYSIS

5.1 INTERPRETATION ON QUESTIONNAIRE

A) Bank wise Distribution of Account Holders

Based on the response of 100 people following table has been made:

NAME OF THE BANK NO. OF ACCOUNTS % age

HDFC 25 28%

ICICI 25 44%

UTI 25 8%

IDBI 25 20%

Table 4- Bank wise Distribution of Account Holders

41

Chart 1 - Bank wise Distribution of Account Holders

Rank in Order of Banks With Respect To Number of Customers Held

ICICI

HDFC

IDBI

UTI

Since HDFC Bank is number two in terms of number of account holders, and its positive image

and enormous goodwill among masses elevates, its position from nicher to runner in retail

banking sector. It can very well take on the challenge posed by ICICI Bank and try to improve its

position by focusing on key strength areas and strategically eliminating its weak points.

B) Popularity of the Types of Accounts

Based on the response of 100 people following table has been made:

Name of Account Used by people % age

SAVINGS 25 32%

42

CURRENT 25 28%

FIXED 25 16%

SALARY 25 24%

Table 5- Popularity of the Types of Accounts

FIXED16%

SALARY24%

SAVINGS32%

CURRENT28%

Chart 2- Popularity of the Types of Accounts

Types of accounts held by people ranked in order:

Savings Account

Current Account

Salary Account

Fixed Account

Since saving account ate the most popular among masses, innovative ideas has to be framed to

inveigle new prospects into this venture. Possible targets could be school and college going

students, housewives and small businessmen who could easily put their money from irregular

source of income into this account.

C) Most Sought After Attributes of a Bank

People ranked different attributes as 1, 2, 3 etc.

Based on these responses mean rank has been calculated.

43

ATTRIBUTES MEAN RANK

ATM 2.6

Facilities 3.88

Location 2.72

Service 4.5

Atmosphere 5.276

Employee Behavior 3.388

Table 6- Most Sought After Attributes of a Bank

Chart 3- Most Sought After Attributes of a Bank

Now Arranging The Mean Ranks In Ascending Order We Get The Overall Rank Which Is As Follows:

ATM

LOCATION

EMPLOYEE BEHAVIOUR

FACILITIES

SERVICE

44

ATMOSPHERE

However it was felt during the survey that major constraint which may laggard the growth of

HDFC Bank is the inadequate number of ATMs across the country. The Bank need to

improve upon this front because in terms of customers consideration of attributes in choosing

a bank ATMs and location of it are of paramount important.

D) Satisfaction Level of Customers

From the responses of customers of different types of Accounts Customer Satisfaction level has

been gauged.

Savings 80%

Current 76%

Salary 84%

Fixed 72%

Table 7- Satisfaction Level of Customers

0%

20%

40%

60%

80%

100%

SAVINGS CURRENT SALARY FIXED

Series1

Chart 4- Satisfaction Level of Customers

45

As we can clearly make out from the graph above shown that salary account is most popular

among the customers .After which savings is the second most popular among customers.

E) Possibility Of Expansion Considering Present Customer Base

From the responses of question whether people would like to open another account following

table has been made.

Table 8- Possibility of Expansion Considering Present Customer Base

Chart 5- Possibility of Expansion Considering Present Customer Base

The chart above shows that 45% of people would like to open another account in the HDFC

Bank, which means that they are satisfied with the facilities and services provided by the bank to

46

YES 45%

NO 55%

NO55%

YES45%

YES

NO

them. While 55% of people says no to opening another account which means that they are not

satisfied with the bank.

5.2 CHI-SQUARE TEST

HYPOTHESIS

Ho: There is no significant difference of opinion between the sex & Account type groups of the

respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the sex & Account type groups of the

respondent with the personal interaction of the bank.

.

Chi-Square Tests

100.000a 3 .000

138.629 3 .000

79.200 1 .000

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 12.50.

a.

Table 9 Showing Chi-Square Test on sex & Account type

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.000 significant values and it is less than 0.5 so

47

it is alternate hypothesis. So there is a no significant difference of opinion between the sex &

Account type groups of the respondent with the personal interaction of the bank.

Hypothesis

Ho: There is no significant difference of opinion between the gender & invested in group of the

respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the gender & invested in groups of the

respondent with the personal interaction of the bank.

Chi-Square Tests

.160a 3 .984

.160 3 .984

.000 1 1.000

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 12.50.

a.

Table 10 Showing Chi Square on gender & Invested In

Interpretation

48

The above table shows the chi-square test results. Here the test is done for sex and invested in

and the Pearson chi-square result shows there is 0.000 significant value and it is greater than 0.5

so it is null hypothesis. So there is a difference of opinion between the gender & invested in

groups of the respondent with the personal interaction of the bank

HYPOTHESIS

Ho: There is no significant difference of opinion between the gender & Another Account groups

of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the gender & Another Account groups

of the respondent with the personal interaction of the bank.

Chi-Square Tests

.040b 1 .841

.000 1 1.000

.040 1 .841

1.000 .500

.040 1 .841

100

Pearson Chi-Square

Continuity Correctiona

Likelihood Ratio

Fisher's Exact Test

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)Exact Sig.(2-sided)

Exact Sig.(1-sided)

Computed only for a 2x2 tablea.

0 cells (.0%) have expected count less than 5. The minimum expected count is22.50.

b.

Table 11 Showing Chi Square Test on gender & another Account

49

Interpretation

The above table shows the chi-square test results. Here the test is done for and the Pearson chi-

square result shows there is 0.841 significant value and it is greater than 0.5 so it is null

hypothesis. There is a significant difference of opinion between the gender & Another Account

groups of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the education & Invested In groups of

the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Education & Invested in groups of

the respondent with the personal interaction of the bank.

EDUCATION * INVESTED IN

Chi-Square Tests

52.000a 9 .000

62.877 9 .000

1.426 1 .232

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 6.25.

a.

Table 12 Showing Chi Square Test on Education & Invested In

Interpretation- The above table shows the chi-square test results. Here the test is done for sex

and account type and the Pearson chi-square result shows there is 0.000 significant values and it

50

is less than 0.5 so it is Alternative hypothesis. There is no significant difference of opinion

between the education & Invested In groups of the respondent with the personal interaction of

the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Education & Account Type groups

of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Education & Account Type groups

of the respondent with the personal interaction of the bank.

EDUCATION * ACCOUNT TYPE

Chi-Square Tests

.800a 9 1.000

.803 9 1.000

.000 1 1.000

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 6.25.

a.

Table 13 Showing chi Square Test on Education & Account Type

Interpretation

51

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 1.000 significant value and it is greater than 0.5

so it is null hypothesis. There is a significant difference of opinion between the Education &

Account Type groups of the respondent with the personal interaction of the bank

HYPOTHESIS

Ho: There is no significant difference of opinion between the Education & another Account

group of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Education & another Account group

of the respondent with the personal interaction of the bank.

EDUCATION * ANOTHER ACCOUNT

Chi-Square Tests

3.677a 3 .299

3.720 3 .293

.200 1 .655

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 11.25.

a.

Table 14 Showing Chi Square Test on Education & another Account

Interpretation

52

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.299 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is a significant difference of opinion between the Education &

another Account group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the occupation & Invested in groups of

the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Occupation & Invested in groups of

the respondent with the personal interaction of the bank.

OCCUPTION * INVESTED IN

Chi-Square Tests

36.000a 9 .000

43.781 9 .000

10.138 1 .001

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 6.25.

a.

Table 15 Showing chi square test on occupation & Invested In

53

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.000 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is no significant difference of opinion between the occupation

& Invested in groups of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Occupation & Account Type

groups of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Occupation & Account Type groups

of the respondent with the personal interaction of the bank.

OCCUPTION * ACCOUNT TYPE

Chi-Square Tests

1.440a 9 .998

1.425 9 .998

.310 1 .577

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 6.25.

a.

Table 16 Showing chi Square test on Occupation & Account Type

Interpretation

54

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.988 significant value and it is greater than 0.5

so it is null hypothesis. There is a significant difference of opinion between the Occupation &

Account Type groups of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Occupation & another Account

Type group of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Occupation & another Account

Type group of the respondent with the personal interaction of the bank.

OCCUPTION * ANOTHER ACCOUNT

Chi-Square Tests

11.758a 3 .008

12.011 3 .007

8.712 1 .003

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 11.25.

a.

Table 17 Showing chi square test on Occupation & Another Account

Interpretation

55

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.008 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is no significant difference of opinion between the Occupation

& another Account Type group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Income Group & Invested in Type

group of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Income Group & Invested in Type

group of the respondent with the personal interaction of the bank.

INCOME GROUP * INVESTED IN

Chi-Square Tests

40.000a 12 .000

55.452 12 .000

4.851 1 .028

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 5.00.

a.

Table 18 Showing chi square test on Income Group & Invested In

Interpretation

56

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.195 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is a significant difference of opinion between the Occupation

& another Account Type group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Income Group & Account Type

groups of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Income Group & Account Type

group of the respondent with the personal interaction of the bank.

INCOME GROUP * ACCOUNT TYPE

Chi-Square Tests

.000a 12 1.000

.000 12 1.000

.000 1 1.000

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 5.00.

a.

Table 19 Showing chi square test on Income Group & Account Type

57

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.000 significant values and it is less than 0.5 so

it is null hypothesis. There is no significant difference of opinion between the Occupation &

another Account Type group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Income Group & another Type

group of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Income Group & another Type

group of the respondent with the personal interaction of the bank.

INCOME GROUP * ANOTHER ACCOUNT

Chi-Square Tests

6.061a 4 .195

6.182 4 .186

.500 1 .480

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 9.00.

a.

Table 20 Showing chi Square test on Income Group & Another Type

Interpretation

58

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.195 significant values and it is less than 0.5 so

it is null hypothesis. There is a significant difference of opinion between the Income Group &

another Type group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the AGE & Invested in Type of the

respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the AGE & Invested in Type of the

respondent with the personal interaction of the bank.

AGE * INVESTED IN

Chi-Square Tests

40.000a 12 .000

55.452 12 .000

4.851 1 .028

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 5.00.

a.

Table 21 Showing chi Square test on AGE & Invested In

59

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.000 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is no significant difference of opinion between the AGE &

Invested in Type of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Age & Account Type groups of the

respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Age & Account Type groups of the

respondent with the personal interaction of the bank.

AGE * ACCOUNT TYPE

Chi-Square Tests

.000a 12 1.000

.000 12 1.000

.000 1 1.000

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 5.00.

a.

Table 22 Showing chi Square test on Age & Account Type

60

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 1.000 significant value and it is greater than 0.5

so it is null hypothesis. There is a significant difference of opinion between the Age & Account

Type groups of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the Age & another Account group of

the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the Age & another Account group of the

respondent with the personal interaction of the bank.

AGE * ANOTHER ACCOUNT

Chi-Square Tests

6.061a 4 .195

6.182 4 .186

.500 1 .480

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 9.00.

a.

Table 23 Showing Account chi square test on Age & another

Interpretation

61

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.195 significant value and it is greater than 0.5

so it is null hypothesis. : There is a significant difference of opinion between the Age & another

Account group of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the marital status & invested in of the

respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the marital status & invested in of the

respondent with the personal interaction of the bank.

MARITAL STATUS * INVESTED IN

Chi-Square Tests

20.000a 3 .000

21.288 3 .000

.792 1 .373

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 12.50.

a.

Table 24 Showing chi square test on marital status & Invested In

62

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.000 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is no significant difference of opinion between the marital

status & invested in of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the marital status & Account Type of

the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the marital status & Account Type of

the respondent with the personal interaction of the bank.

MARITAL STATUS * ACCOUNT TYPE

Chi-Square Tests

.160a 3 .984

.160 3 .984

.127 1 .722

100

Pearson Chi-Square

Likelihood Ratio

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)

0 cells (.0%) have expected count less than 5. Theminimum expected count is 12.50.

a.

Table 25 Showing chi square test on marital status & Account Type

63

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.984 significant value and it is greater than 0.5

so it is Null hypothesis. There is a significant difference of opinion between the marital status &

Account Type of the respondent with the personal interaction of the bank.

HYPOTHESIS

Ho: There is no significant difference of opinion between the marital status & Another Account

of the respondent with the personal interaction of the bank.

Ha: There is a significant difference of opinion between the marital status & Another Account of

the respondent with the personal interaction of the bank

MARITAL STATUS * ANOTHER ACCOUNT

Table 26 Showing chi Square test on marital status & another Account

64

Chi-Square Tests

1.980b 1 .159

1.455 1 .228

1.987 1 .159

.228 .114

1.960 1 .162

100

Pearson Chi-Square

Continuity Correctiona

Likelihood Ratio

Fisher's Exact Test

Linear-by-LinearAssociation

N of Valid Cases

Value dfAsymp. Sig.

(2-sided)Exact Sig.(2-sided)

Exact Sig.(1-sided)

Computed only for a 2x2 tablea.

0 cells (.0%) have expected count less than 5. The minimum expected count is22.50.

b.

Interpretation

The above table shows the chi-square test results. Here the test is done for sex and account type

and the Pearson chi-square result shows there is 0.159 significant values and it is less than 0.5 so

it is Alternative hypothesis. There is a significant difference of opinion between the marital

status & Another Account of the respondent with the personal interaction of the bank.

5.3 SWOT ANALYSIS

Strength

The keys strength areas of HDFC Bank are their motivated and highly competent staffs who

is aggressive in their pursuit for excellence in terms of employee competence it rivals the

highly rated foreign banks.

Weakness

Though HDFC Bank has wide coverage of ATM Network throughout the country it is not

considered adequate keeping in view is wide customer base.

Opportunity

HDFC Bank has good opportunity in rural area and offices etc. which are still untouched by

banks of such repute and are considered virgin markets.

Threat

Other banks like ICICI, Centurion, UTI, IDBI, an expanding at a very fast rate and are

perceived as threat to HDFC Bank.

65

CHAPTER VI

FINDINGS, SUGGESTIONS & CONCLUSION

6.1FINDINGS

1. Since HDFC Bank is number two in terms of number of account holders, and its positive

image and enormous goodwill among masses elevates, its position from nicher to runner

in retail banking sector. It can very well take on the challenge posed by ICICI Bank and

try to improve its position by focusing on key strength areas and strategically eliminating

its weak points.

2. Since saving account ate the most popular among masses, innovative ideas has to be

framed to inveigle new prospects into this venture. Possible targets could be school and

college going students, housewives and small businessmen who could easily put their

money from irregular source of income into this account.

3. However it was felt during the survey that major constraint which may laggard the

growth of HDFC Bank is the inadequate number of ATMs across the country. The Bank

need to improve upon this front because in terms of customers consideration of attributes

in choosing a bank ATMs and location of it are of paramount important.

66

4. As we can clearly make out from the graph above shown that salary account is most

popular among the customers .After which savings is the second most popular among

customers.

5. The chart shows that 45% of people would like to open another account in the HDFC

Bank, which means that they are satisfied with the facilities and services provided by the

bank to them. While 55% of people says no to opening another account which means that

they are not satisfied with the bank.

6.2 SUGGESTIONS

Try to improve after sales services.

To be some quality conscious.

Try to install ATM’s at more convenient places for their customer.

Try to provide Complete/Actual information to the customer.

Customer must have all the information regarding charges & fees.

HDFC must issue at par cheques to their customers.

Make Strong Public Relations:

The bank has to provide better services to satisfy the needs and wants of customers specially on

the occasion of deepawali and dasahara like festivals so that the customer has to satisfied with

their services of banks the bank is to provide loans, specially housing loans to the customer at

very low interest rates so that the every middle class family is to avail loans without any

problem.

Continuous Market Feed Back:

To make the good relation with the customer it is very important to take feedback time to time to

know about the problems and difficulties which are faced by the customer.

Provide Recent Information to the Customer:

67

The bank is able to give as many as possible information to our customers so that the customer is

able to understand which type of information is to be used in a particular sector.

Try to Start on Line Trading:

Due to on line trading the convenience to customer is given by way of opening and depositing

their money on the basis of on line services.

Try to Install ATM’s at more Convenient Places:

Financial year is also increase the customer has also available their the bank is to install ATM’s

as many as possible due to convenience of their customer specially in commercial places, like

petrol pumps, in market, in the hospital . So that the customer has convince to withdraw their

money without problems.

Try To Open Extension Counter At Various Places:

The bank has to open their extension counter in various places of their city so that the deposit of

bank is also increase and the turnover of bank during facilities which is provided by bank

cheaper rate.

68

6.3 CONCLUSION

As it is the fastest growing section and HDFC Bank is one of the top biggest player of this sector

in this project I deal with all those areas and various product which attract the customer most.

This project helps those customers who want in-depth knowledge of all the product of

HDFC Bank.

In today’s world it is necessary for a customer to have a complete knowledge of services

provide by a Bank.

This project helps those people and Bank to avail all the facilities and improve their

services respectively.

In this project an attempt is being made to include all the complete and accurate

information regarding the Bank services charges and fine.

69

QUESTIONNAIRE FOR RESPONDENTS

I, hereby, declare that all the information provided by you is strictly for the purpose of research and shall not be used for any other purpose. I am grateful to you for your support and thank you for your honest response. I request you to read the following before you proceed further.

Please tick only one option unless mentioned otherwise.

All the information in the questionnaire is for academic purpose and shall be kept

confidential.

PART-A

1. Respondents Name : ___________ _

2. Sex:

[ ] M [ ] F

3. Age (In yrs) :

18-20 [ ] 20-30 [ ] 30-40 [ ]

40-50 [ ] 50-60 [ ] 60 & above [ ]

70

4. Your marital status

□ Married □Unmarried

5. Your educational background

□Only up to 10th

□10+2

□ Graduate

□ Post graduate and above

6. Which of these best describes your occupation?

Occupation Remark

Working/salaried-Government

Working/salaried- Private

Business

Professional (Doctor, Engineer,

CA, Tax consultant etc.)

7. You consider yourself as belonging to which annual income group

□ <Rs.1 lacs

□ 1-3lacs

□ 3-5lacs

□ 5-10lacs

□ >10 lacs

71

PART -B

8. How satisfied are you with each of the product that you invested in? (The satisfaction could be

based on different parameters e.g. in terms of the returns that product has offered to you / quality

of serviced offered by the company / quality of service offered by the consultant who sold you

the product etc.)

Satisfaction level

Invested in Highly

dissatisfied

Dissatisfied Neither

satisfied nor

dissatisfied

Moderately

satisfied

Completely

satisfied

Fixed

Acct

Savings

Acct

Salary

Acct

Current

Acct

9. Do you have an account in any Scheduled Bank?

HDFC BANK

ICICI BANK

UTI BANK

IDBI BANK

10. What Type of account do you have?

72

SAVING ACCOUNT

CURRENT ACCOUNT

FIXED ACCOUNT

SALARY ACCOUNT

11. How long are you being associated with the Bank?

YEARS________ MONTHS______

12. What attracts you most? (Rank)

ATM

LOCATION

EMPLOYEE BEHAVIOUR

FACILITIES

SERVICE

ATMOSPHARE

13. Do you HDFC Bank Would be able to Position itself as a Strong Financial Institution?

□ yes □ No

14. Are you satisfied with the Bank?

□ yes □ No

15. If yes do you want to open another account?

□ yes □ No

16. If no then what are the reasons for Dissatisfaction?

73

17. If you are offered a Good Savings Plan from HDFC Bank with good rate and benefit will you

be interested?

□ yes □ No

Thank u

BIBLIOGRAPHY

BOOKS

Principles Of Marketing - Philip Kotler

Marketing Management - Rajendra Saxena

Research Methodology - C. R. Kothari

Websites:

WWW. HDFC.COM

WWW. IRDAINDIA.ORG

WWW. FINANCIAL EXPRESS .COM

74

APPENDIX

1. CURRENT ACCOUNT :

Now, with an HDFC Bank Current Account, experience the freedom of multi-cit

banking! You can have the power of multi-location access to your account from any of

our 1,725 branches in 780 cities. Not only that, you can do most of your banking

transactions from the comfort of your office or home without stepping out.

We make it our business to help you with your business by offering you a Current

Account with all the benefits you need to stay ahead of your competition.

At HDFC Bank, we understand that running a business requires time and money, also

that your business needs are constantly evolving. That's where we come in. We provide

you with a choice of Current Account options to exclusively suit your business -

whatever the size or scope.

2. SAVING ACCOUNT:

75

Banking should be effortless. With HDFC Bank, the efforts are rewarding. No matter

what a customer's need and occupational status, we have a range of solutions that are

second to none .

These accounts are primarily meant to inculcate a sense of saving for the future,

accumulating funds over a period of time. Whatever your occupation, we are confident

that you will find the perfect banking solution. Open an account in your name or register

for one jointly with a family member today.

76