customer relationship management on retail banking. on ing bank
DESCRIPTION
This MBA research projectTRANSCRIPT
1
A Project Study Report
On
“CUSTOMER RELATIONSHIP MANAGEMENT IN
INDIAN RETAIL BANKING”
Submitted in fulfillment of summer internship programme of
Post Graduate Diploma in Management
2011-2013
Submitted by
Nawaz Ali Khan
Roll No: 09
Under the Guidance of
COMPANY GUIDE INSTITUTE GUIDE
MR. SOUBHAGYA PANIGRAHI Ms. SUCHISMITA PATNAIK
BRANCH MANAGER Faculty (Finance) ING VYSYA BANK
Asian Workers Development Institute
Rourkela, Odisha – 769003
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DECLARATION
I hereby declare that the work incorporated in the present research project entitled ―CUSTOMERS
RELATIONSHIP MANAGEMENT IN INDIAN RETAIL BANKING‖ is my own work and is
original in nature. This work is in (part or in full) has been submitted to ASIAN WORKERS
DEVELOPMENT INSTITUTE and this project has not performed the basis work for the award of
any Degree or diploma/associate ship, fellowship and similar project if any.
Nawaz Ali Khan
PGDM-2nd
year
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CERTIFICATE
I feel great pleasure in certifying that the research project entitled ―CUSTOMERS
RELATIONSHIP MANAGEMENT IN INDIAN RETAIL BANKING‖ embodies a record of the
result of investigation carried out by Nawaz Ali Khan under my guidance.
I am satisfied with the analysis of data , interpretation of results and conclusion drawn.
I recommend the submission of research project.
Place:Rourkela Ms.Suchismita pattnaik
Date:
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ACKNOWLEDGEMENT
I express my sincere thanks to my project guide Ms.Suchismita Patnaik faculty of Finance
Mr.Soubhagya Panigrahi Branch Manager ING Bank and Mr.Dharmaraj Sahoo sales executive ING
Bank for guiding me right from the inception till the successful completion of the project. I
sincerely acknowledge him/her for extending their valuable guidance , support for literature and
critical reviews of the project and the report and above all the moral support they had provided to
me with all the stages of this project.
I would also like to thanks the supporting staff of ― ASIAN WORKERS DEVELOPMENT
INSTITUTE‖ and ING VYSYA BANK for their help and co-operation throughout this project.
-Nawaz Ali Khan-
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PREFACE
The viewing of the marketing in business administration of an organization is a fast growing
concept in India. Marketing is any undertaking require aptitude, skills, expertise, knowledge, and
efforts in sales as well as marketing. Marketing is considered to be the most valuable assets of the
organizations in revenue generation which is greatly influenced by the performance of its
executives.
All professional postgraduates course like MBA/PGDM envisage for a student to acquire
proficiency in academic knowledge as well as its application in practice by way of exposure to the
business world. Industrial training is therefore a part of MBA/PGDM curriculum which helps in
developing analytical and interpreting skills in the students through application of several concepts
of management to understand the functioning of industries. This training was conducted in ING
Vysya Bank.
-Nawaz Ali Khan-
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CONTENTS
Chapter 1 Introduction to Banking Industry
What is Banking
History of Indian Banking System
1
Chapter 2 Company Profile
ING Group
ING Vysya Bank
Journey of ING Vysya
2-3
Chapter 3 Introduction to CRM
CRM Overview
What is CRM
Evolution of CRM
CRM in Indian Retail Banking
CRM Value Chain For Indian Retail Banks
4-50
Chapter 4 HNI Customers
Who are HNI Customers
How to approach HNI Customers
51-59
Chapter 5 IVBL and Current Accounts 60-62
Chapter 6 Savings Accounts 63-77
Chapter 7 Research Methodology
Objective of Study
Scope of Study
Methods of study
Limitations
78-79
Chapter 8 Analysis and Data Interpretations 80
Chapter 9 Comparative Analysis of ING with Competitive Banks 81-82
Chapter 10 SWOT Analysis of ING 83-89
Chapter 11 Conclusion
Chapter 12 Suggestion and Recommendations
Chapter 13 Questionnaire
Chapter 14 Bibliography
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INTRODUCTION OF BANKING
INDUSTRY
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WHAT IS BANKING?
Banking in a traditional sense is the business of accepting deposits of money from public for the
purpose of lending and investments. These deposits can have a distinct features of being withdrawal
by cheques , which no other financial institution offer.
In addition, bank also offers various other financial services which includes-
Issuing Demand Draft and travelers Cheque
Credit Card
Collections of Cheques, Bills of exchange
Safe deposits lockers
Issuing Letter of credit and Letter of Guarantee
Sales and Purchase of Foreign Exchange
Custodial Services
Investments and Insurance services.
The Business of Banking is highly regulated since Banks deals with money offered to them by
public and ensuring the safety of public money is the prime responsibilities of any bank. That is
why banks are expected to be prudent in their lending and investment activities. Every bank has
compliance department which is responsible to ensure that all services offered by the banks and the
processes followed are in compliance with the local regulations and the bank‘s corporate policies.
Banking Regulation Act, 1949
Foreign Exchange Management Act, 1999
Indian Contract Act, 1872
Negotiable Instrument Act, 1881
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A banking system also referred as a system provided by the bank which offers cash management
services for customers, reporting the transactions of their accounts and portfolios, through out the
day. The banking system in India, should not only be hassle free but it should be able to meet the
new challenges posed by the technology and any other external and internal factors. For the past
three decades, India‘s banking system has several outstanding achievements to its credit. The Banks
are the main participants of the financial system in India. The Banking sector offers several
facilities and opportunities to their customers. All the banks safeguards the money and valuables
and provide loans, credit, and payment services, such as checking accounts, money orders, and
cashier‘s cheques. The banks also offer investment and insurance products. As a variety of models
for cooperation and integration among finance industries have emerged, some of the traditional
distinctions between banks, insurance companies, and securities firms have diminished. In spite of
these changes, banks continue to maintain and perform their primary role—accepting deposits and
lending funds from these deposits.
HISTORY OF INDIAN BANKING SYSTEM
The first bank in India, called The General Bank of India was established in the year 1786. The East
India Company established The Bank of Bengal/Calcutta (1809), Bank of Bombay (1840) and Bank
of Madras (1843). The next bank was Bank of Hindustan which was established in 1870. These
three individual units (Bank of Calcutta, Bank of Bombay, and Bank of Madras) were called as
Presidency Banks. Allahabad Bank which was established in 1865, was for the first time completely
run by Indians. Punjab National Bank Ltd. was set up in 1894 with head quarters at Lahore.
Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara Bank,
Indian Bank, and Bank of Mysore were set up. In 1921, all presidency banks were amalgamated to
form the Imperial Bank of India which was run by European Shareholders. After that the Reserve
Bank of India was established in April 1935. At the time of first phase the growth of banking sector
was very slow. Between 1913 and 1948 there were approximately 1100 small banks in India. To
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streamline the functioning and activities of commercial banks, the Government of India came up
with the Banking Companies Act, 1949 which was later changed to Banking Regulation Act 1949
as per amending Act of 1965 (Act No.23 of 1965). Reserve Bank of India was vested with
extensive powers for the supervision of banking in India as a Central Banking Authority.
After independence, Government has taken most important steps in regard of Indian Banking Sector
reforms. In 1955, the Imperial Bank of India was nationalized and was given the name "State Bank
of India", to act as the principal agent of RBI and to handle banking transactions all over the
country. It was established under State Bank of India Act, 1955. Seven banks forming subsidiary of
State Bank of India was nationalized in 1960. On 19th July, 1969, major process of nationalization
was carried out. At the same time 14 major Indian commercial banks of the country were
nationalized.
In 1980,another six banks were nationalized, and thus raising the number of nationalized banks to
20. Seven more banks were nationalized with deposits over 200 Crores. Till the year 1980
approximately 80% of the banking segment in India was under government‘s ownership. On the
suggestions of Narsimhan Committee, the Banking Regulation Act was amended in 1993 and thus
the gates for the new private sector banks were opened.
The following are the major steps taken by the Government of India to Regulate Banking
institutions in the country:-
1949 : Enactment of Banking Regulation Act.
1955 : Nationalisation of State Bank of India.
1959 : Nationalization of SBI subsidiaries.
1961 : Insurance cover extended to deposits.
1969 : Nationalisation of 14 major Banks.
1971 : Creation of credit guarantee corporation.
1975 : Creation of regional rural banks.
1980 : Nationalisation of seven banks with deposits over 200 Crores.
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4
COMPANY PROFILE
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OVERVIEW :
The ING Group is a global financial institution offering retail banking, direct banking, commercial
investment banking, assets management and insurance services.
ING is an abbreviation for Internationale Nethelanden Groep (English- International Netherland
Group).
The orange Lion on ING‘s logo is a play on the group‘s Dutch origin under the house of Orange
Nassau. ING is the Dutch member of Inter- Alfa Group Of Banks, a co-operative consortium of 11
prominent European Banks.
According to fortune magazine, in 2010 ING was the largest banking/financial services & insurance
conglomerate in the world by revenue with gross receipt exceeding €54 billion (US $77 billion) per
annum. The group is also the world‘s 12th
largest corporation by revenue according to global
fortune 500. ING served over 85 million individuals and institutional clients in more than 45
countries, with a world wide work force exceeding 100,000
History
ING was founded in 1991 by a merger between Nationale-Nederlanden and NMB Postbank
Group . During the past years ING has become a multinational with diverse international activities.
The root of ING can be traced to the insurers De Nationale Levensverzekering Bank and De
Nederlanden van 1845 and to the public bank services such as De Rijkspostspaarbank and De
Postcheque- and Girodienst, as well as to the Nederlandsche Middenstands Bank. These are the
legal predecessors of the ‗founding fathers‘ of ING : Nationale-Nederlanden and NMB Postbank
Group.The founding of ING as one company was started in 1990 when the legal restrictions on
merger between insurers and banks were lifted in the Netherlands. This prompted insurance
company Nationale-Nederlanden and banking company NMB Postbank Group to enter into
negotiations.
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The merger into Internationale Nederlanden Groep took place in 1991. The market soon
abbreviated to the name I-N-G. The company followed suit by changing the statutory name into
ING Groep N.V. Since ING has developed from a Dutch company with some international business
to a multinational with Dutch roots. This was achieved through a mixture of organic growth, such
as the creation of ING Direct from scratch, as well as various large acquisition.
The first large acquisition took place in 1995, when ING took over Barings Bank. This acquisition
increase the brand recognition of ING around the world and strengthened its wholesale banking
market in emerging markets. And there was Life of Georgia. This insurance company was acquired
by Nationale-Nederlanden in 1979, resulting in a significant increase in activities in the US. Via
Life of Georgia,the activities in Asia expanded considerably. However in 2004, ING as a group had
become well established in both region and Life of Georgia was sold.
Other acquisition such as the Belgian Bank Brussels lambert, strengthen the group presence in
Benelux. In addition the activities in United States were doubled as a result of organic growth and
the acquisition of Equitable of lowa, Relia Star, Aetna financial services, and merchant Bank
Furman Selz.
ING is also active in other parts of the world. In 2011, ING acquired a majority interest in Polish
Bank Slaski and entered the Indian life insurance market through ING Vysya life insurance.
Furthermore ING participated in a number of financial institution an important example is the
partnership with the Bank of Beijing.
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ING Lion Brief History
The lion is the symbol of ING since 1991.
The lion is the king of animals and symbol of power. Orange is the national colour of the
Netherland and also the symbol of Netherlands.
The predecessors of ING, like the saving bank, ‗Rijkspostspaarbank’ a government service use the
lion in her logo since 1881. Most government services did in those days. But also the assurance
company, ‗De Nederlanden van 1845 ‗ used the lion in her logo. And the other predecessor, ‗De
Nationale Levensverzekering bank’used a virgin with a lion lying by her feet.
The Nederlandsche Middenstands Bank (NMB) also used a lion in her logo in the fifties as a
Dutch bank with state guarantee.
In 1963, the ‗Nationale-Nederlanden‘(a merger between the two above named assurance
companies) chose a new logo :two graphic orange NN by the same reason, orange was the Dutch
colour. The Post bank used the blue lion since 1986 (still does). After the merger of Post bank and
NMB in 1989 the Group logo become grey lion.
In 1991 when ‗NMB postbank Group‘ merged with ‗Nationale-Nederlanden‘ the board chose the
orange lion for the logo.
Our Profile :
ING is a global financial institution of Dutch origin, currently offering investment banking, life
insurance and retirement services to meet the needs of a broad customer base. Going foreword we
will concentrate on our position as a retail, direct and commercial bank, while creating an optimum
base for an independent future of our insurance operations (including investment management).
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Mission and Strategy :
Our Mission :
ING‘s mission is to set the standards in helping our customers manage their financial future. ING
aims to deliver financial product and services in the way that our customers wants them delivered:
with exemplary services convenience and competitive prices.
Our Strategy :
To serve the interests of our stake holders, increase management focus and increase value for our
stake holders, ING is moving towards separation of its banking and insurance operations. We
believe the widespread demand for greater simplicity, reliability and transparency makes this the
best course of action. In the future, ING bank will build its global presence and international
network and capitalize on its leadership position in gathering savings, multi-channel distribution ,
simple propositions and marketing.
ING insurance has a strong position as a global provider of life insurance and retirement services
and is very well positioned to capitalize on socio economic trends.
We will focus on earning customer‘s trust through transparent products, value for money and
superior service. This reflects our universal customer ideal: saving and investing for the future
should be easier.
Our Stakeholders :
ING conducts business on the basis of clearly defined business principles. In all our activities we
carefully weigh the interest of our various stakeholders : customers, employees, business relations
and suppliers, society at large and shareholders. ING strives to be a good corporate citizen.
Business Principles :
Our business centers around people and trust. Only by acting with professionalism and integrity can
we maintain our stakeholders‘ preserve our company‘s reputation. The ING business principles
play an important role in this respect.
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The ING Business Principles are :
We act with integrity
showing fair, honest and lawful behavior so we continue to earn our stakeholders‘ trust.
We are open and clear
saying what we mean, meaning what we say and listening carefully.
We respect each other
we value diverse thinking and respect human rights.
We are socially and environmentally responsible
we will do no harm and seek positive change through our products, people and activities.
Our Corporate Responsibilities:
ING wants to build its future on sustainable profit based on sound business ethics and respect for its
share holders and be a good corporate citizen. For only by acting with professionalism and
integrity, will we be able to maintain our stakeholder‘s trust and preserve our reputation. Our
business principle prescribe the corporate value we pursue and the responsibilities we have towards
society and environment. We act with integrity, we are open and clear, we respect each other and
we are socially and environmentally responsible.
Corporate Governance:
ING believe good corporate governance entails a careful balance between short term and long term
interests of the company. ING‘s aim is to have a governance structure that is transparent and does
justice to the interests of all its stakeholders, customers, employees, shareholders and society as a
whole.
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Management Structure:
ING has a two-tier board structure consisting of the Executive Board and the Supervisory Board. In
ING's view, a two-tier board is the best way to create the proper checks and balances in the
company.
The Executive Board is responsible for day-to-day management of the business and long-term
strategy. The Supervisory Board is responsible for controlling management performance and
advising the Executive Board. The Supervisory Board is made up exclusively of outside directors.
In line with the April 2009 strategy announcement, ING has taken measures to simplify
governance. To increase the business focus of the Group‘s leadership, Banking and Insurance now
have their own Management Board consisting of the Group CEO, CFO and CRO and positions for
four members.
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ING VYSYA
B A N K
Company Overview :
ING Vysya Bank Ltd., is an entity formed with the coming together of erstwhile, Vysya
Bank Ltd, a premier bank in the Indian Private Sector and a global financial powerhouse,
ING of Dutch origin, during Oct 2002.
The origin of the erstwhile Vysya Bank was pretty humble. It was in the year 1930 that a
team of visionaries came together to form a bank that would extend a helping hand to those
who weren't privileged enough to enjoy banking services.
It's been a long journey since then and the Bank has grown in size and stature to encompass
every area of present-day banking activity and has carved a distinct identity of being India's
Premier Private Sector Bank.
In 1980, the Bank completed fifty years of service to the nation and post 1985; the Bank
made rapid strides to reach the coveted position of being the number one private sector bank.
In 1990, the bank completed its Diamond Jubilee year.
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75 years of journey of ING………………………
1930 Set up in Bangalore
1948 Schedule Bank
1985 Largest Private Sector Bank
1987 The Vysya Bank Leasing Ltd. Commenced.
1988 Pioneered the concept of co-branding of credit cards
1990 Promoted Vysya Bank Housing Finance Limited
1992 Deposits cross Rs 1000 Crores
1993 Numbers of branches crossed 300
1996 Sign Strategic Alliance with BBL, Belgium
Two national awards by Gem & Jewellery export promotion for excellent
performance in export promotion.
Cash management services & Commissioning of VSAT
Golden peacock awards for the best HR
1998 Practices by institute of directors. Rated as best domestic bank in India by
global finance.
2000 State -of -the –art date centre at ITPL, Bangalore.
RBI clears setting up of ING Vysya Life Insurance Company.
2001 ING commenced life insurance business.
2002 The Bank launched a range of products & services like the VysyaVyapar
Plus, the range of loan schemes for traders, ATM services, Smartserv,
personal assistant service, Save & Secure, an account that provides accident
hospitalization and insurance cover, Sambandh, the International Debit Card
and the mi-b@nk net banking service.
2002 ING take over the management of the Bank from 7th
Oct, 2002
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2002 RBI clears the new name of the Bank as ING Vysya Bank Ltd, vide their
letter of 17.12.02
2003 Introduced customer friendly products like Orange Savings, Orange Current
and Protected Home Loans
2004 Introduced Protected Home Loans - a housing loan product
2005 Introduced Solo - My Own Account for youth and Customer Service Line –
Phone Banking Service
2006 Bank has networked all the branches to facilitate ‗AAA‘ transactions i.e.
Anywhere, Anytime & Anyhow Banking
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INTRODUCTION TO
“Customer Relationship Management
In Indian Retail Banking”
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CUSTOMER RELATIONSHIP MANAGEMENT
The 1990s have been a dynamic period within the information systems field. One of the most
exciting uses of new technologies has been in the area of Customer Relationship Management
(CRM) systems.
Today the availability of econometric, demographic, lifestyle and psychographic data, decision
support systems, the Internet, and other customer access techniques are helping marketing and
senior management make customer care a reality rather than just a vision. Companies no longer
want to treat their customer base as a homogeneous collection of revenue generating units; they
want to get up close and personal with each of them individually.
Everyone has been exposed to these changes: the mailings from banks offering special interest
rates, phone companies offering incentives to switch to their services, etc. At the core of all of these
is the offering company‘s desire to develop a ―relationship‖ with a target audience.
Customer Relationship(CRM) is developing into a major elements of corporate strategy for many
organizations. CRM, also known by other terms such as relationship marketing and customer
management is concerned with creation, development and enhancement of of individualized
customer relationship with carefully targeted customers and customer groups resulting in
maximizing their customer life time value.
The traditionally approach marketing has been continuously questioned recent years. This approach
emphasized on the management of the key marketing mix elements such as product, price,
promotion and place within the functional context of the marketing department. The new CRM
approach, while recognizing these key elements still need to be addressed ,reflect the need to create
an integrated cross functional which focus on marketing- one which emphasizes keeping as well as
winning customers. Thus the focus is shifting from customer acquisition to customer retention and
ensuring the appropriate amount of time, money, and managerial resources are directed towards
these tasks.
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The adoption of CRM is being filled by a recognition that long term relationship with customers is
one of the most important assets of the organizations and that information enabled system must be
developed that will give them ―customer ownership‖ successful ownership will create competitive
advantage, which result in improved customer retention and profitability for the company.
What is Customer Relationship Management ?
It is a comprehensive approach that provides seamless co-ordination between sales,
customer service, marketing and field support and other customer touching functions.CRM
integrates people, process and technology to maximize relationship with all customers
including e-customers, distribution channels and suppliers.
It is customer focused business strategy designed to optimize revenue, profitability and
customer loyalty. By implementing a CRM strategy, an organization can improve the
business process and technology solutions around selling and marketing and service
functions across all customer touch-(for example: web, e-mail, phone, fax, in- person).
Simply stated CRM comprises the acquisition and deployment of knowledge about customers to
enable the company to sell more of their products or service more efficiently.CRM begins with in-
depth analysis of customer behavior and attributes to achieve complete knowledge of the customers,
their habits and desires and their needs. It then applies this knowledge to the formulation of
marketing campaigns, strategies and treatment plans. However managing the relationship also
implies customer interaction. Therefore CRM also encompasses enabling a network of ―touch
points‖ by which the organization can establish, cultivate and maintain long-lasting and mutually
beneficial interactions with the customers. These are the two cornerstones of CRM—the knowledge
or customer information platform and the customer interaction platform.
Finally, in order to achieve continuous improvement, it is necessary to track the customer
interactions and use those result to refine future actions.
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Evolution Of CRM
While revolutionary in many respects, CRM is also a natural and predictable extension of how
marketing and sales are evolved over the years, and in many ways are coming to a full circle.
In the past customers were served by the corner stores and door to door sales forces. The corner
stones were small, intimate and provided one on one services to their clientele. The door to door
sales person was the other face of the company and the personal relation established by the sales
person was the key to success. This model provided, through personal interaction, intimacy and
knowledge about the customer and developed customer loyalty and trust.
Mass Marketing :
The age of mass marketing replaced the intimacy of direct sales in many organizations. Centralized
large scale production, wide-geographic distribution, and one way communication on grand scale
created a variety of easily available and affordable goods. This put pressure on relatively inefficient
corner stores and doo –to-door models. Overtime the local corner stores gave way to the super
markets, malls and mega market of today. While society has benefitted from the cost efficiencies of
these arrangements some things was lost in the bargains.
Mass marketing was enabled through technological improvement in TV, radio, and the printing
press all of which created the simple and powerful means to communicate a company‘s message to
millions of people at once. Marketing‘s major goal was to push product and create brand
recognition.
Target Marketing :
In the mid 1980‘s with the advancement of technology and refinement in direct mail and
telemarketing, another approach to connect directly with the customer evolved. The use of
Information System technology allowed the selection of specified ―targeted‖ customers via mail or
telephone. Unlike mass marketing; target marketing has the advantage of potentially receiving
direct response from a customer. The general strategy was to unearth the potential customers by
canvassing large numbers.
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Target marketing recognized the need to interact more with customers, at a very superficial level
but did not go far enough. Nonetheless target marketing was a significant step in evolution of
today‘s CRM, in that it moved the relation between producer and consumer one more step towards
the personal interaction.
Why Is It Necessary ?
Many companies are turning to customer relationship management system to better understand
customer needs and wants. CRM application often used in combination with data ware housing, e-
commerce application, and call centre, which allows companies to access information about
customers buying, history, preferences, complaint and other data. So they can better anticipate what
customer will want. The goal is to instill greater customer loyalty.
Other Benefits Include:
The ability to provide faster response to customer inquiries
Increase efficiency through automation
Having a deeper knowledge of customers.
Getting more market of cross selling opportunities.
Identifying the most profitable customers.
Receiving the customer feedback that leads to new and improved product and services.
Doing one-to-one marketing.
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CRM IN INDIAN RETAIL BANKING :
Excelling and managing customer relationship is the future of any business or everybody’s
business. Customer focusing is not be viewed as business strategy but should become a corporate
mission.
“Management is the specific and distinguishing organ of any and all organizations. There is or
there must be one right organization. The organization that fix the task. The task is to lead the
people. And the goal is to make productive the specific strength and knowledge of each individual.”
By Peter Drucker
The banking scene has seen paradigm shift in the nineties. The first of these shift occurred during
1991-1994 phase in which the emphasis shifted from growth to profits, from balance sheet size to
clean, transparent and healthy balance sheet, from regulated and administered regime to a relatively
deregulated one. During the next phase 1994-1998, the financial markets started giving interest rate
signals, link between forex and money markets become strong, interest rates were deregulated and
competition intensified.
The process of economic liberalization and financial sector reforms brought the issue of customer
focus to the forefront.
Towards getting closer to the customers with well defined characteristics, banks are establishing
strategic business units such as Corporate Account Group, National Banking Group, International
Banking Group etc. we are able to witness attempts by various public as well as private sector
banks to shape their structure and functioning with customer in view.
The customer choice and awareness have been increasing tremendously during the decade due to
more open economy, the advent of information technology and media revolution, besides hectic
competition for resources by banks and non-banks.
Banks are attempting by creating exclusively delivery channels for specific customer segments. As
market become increasingly competitive, customers can now immediately go else where if they
don‘t get what they want.
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Continuous improvement, gaining the competitive edge, increased market share, higher profits—
none of these things is possible unless business can find new way of maintaining the loyalty of
existing customers. Customer focus is the ability to provide predictably positive experiences that
consistently meet or exceed the customer‘s expectations. Customer focus should be managed by
―moments of truth‖.
A moment of truth refers to any incident/episode when a customer comes into contact with any
aspects of the services offered and, on the basis of the contact, forms an opinion about the quality of
the service and quality of the product offered.
The customer perception is changing day by day. Peter Drucker said twenty five years ago—
―The purpose of business is to attract and retain a customer‖. It sounds simple but too many
business have forgotten it to their cost. There is a phenomenal change and paradigm shift towards
customer focus for the past five decades.
Serving the customer 1950’s to 1960’s
Satisfying the customer 1960’s to 1980’s
Pleasing the customer 1980’s to 1990’s
Delighting the customer 1990’s to 2000’s
Retaining the customer 2000AD and beyond
Today the relationship between the banker and customer has come under sharp focus both at the
banker‘s as well as at the customer‘s ends. Many customers are not only wanting but are expecting
better service. The factors viz.., lack of competition, administered regime, insulated economy which
hindered market forces and choice for customers are fading away, forcing banks to focus on the
customers.
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The dominant question which are the minds of bank management today is how to improve
customer service and competitive advantage. The product are almost the same but the battle ground
is service.
PARADIGM SHIFT- SCENARIO IN INDIA
BEFORE 1991
Sellers market
Protected markets
Not many global brands
Friendly competition
Patient customers
Limited choice for customers
Limited TV promotion
Cost plus pricing
Limited role of service
Slower marketing reflexes
Speed @ will
Fundamental standalone system
IT competitive advantage
Gaining new customers
AFTER 1991
Buyer‘s market
Open market
Increase in numbers of global brands
Cut- throat competition
Demanding customers
Increasing choice for customers
Extensive TV promotion
Competitive price cutting
Increase role of service
Quicker marketing reflexes
Turbo speed
Enterprise system (ERP/CRM/SCM)
IT- enabler
Retaining existing customers
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CRM Value Chain For Indian Retail Banks :
Building Customer Relationships
Marketing approach lays emphasis on building long term mutually beneficial relationship with
customers. Organization which look only to short run profits and disregard the customers
interests do so at their own peril. Banking is a service oriented industry and it has the potential
to reach almost the majority sections of the populations.
In a competitive environment, people can choose. In choosing their banks customers are
influenced by the image of the bank, and the perceived quality of service. The bank that
provides batter service and the bank that is perceived to be different the average gets the
attention of the customers.
Perception of good service should relate to courtesy, promptness, employee attitudes, physical
facilities, customer identification and recognition, speed, clarity and communication skills, and
a host of such features. It get manifested in the care, concern, commitment, and sensitivity
shown by the bank staff in dealing with the customers, big or small, old or new. It relates to
living up to every letter used in the advertisement and campaigns aimed at projecting
themselves. Ensuring quality service implies giving attention to details, being sensitive to
customer expectations.
Quality Service
The word-- quality has many meanings :
A degree of excellence
Conformity with requirements
The totality of characteristics of an entity that bears on its ability to satisfy stated or implied
needs
Fitness for use
Fitness for purpose
Freedom from defects, imperfections and contaminations
Delighting customers
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Certain key points which the banks should focus on, for providing better customer service are –
Setting service standards and improve measurement of service—some banks started
obtaining ISO certification for their branches and administrative offices.
Providing skill based training product/service knowledge to the front line staff.
Establishing incentives and motivation for quality service.
Making customer satisfaction a central focus at corporate level.
Enunciating a new corporate philosophy (mission/vision) based on quality of service by
changing the cultural and attitudinal bias in the organization.
Customer Culture
There are three main elements to consider when aligning the business towards a customer
relationship format.
The first is to do with retention.
The second stage is to develop customer potential—turning that one off infrequent
casual customer into a higher spending, more frequent, referring advocate.
The third element of customer relationship is the de-selection of customers. This means
at some points the bank has to start to lose those customers who are not ones offering
long-term future value.
Customer Life Time Value
Customer lifetime value is typically the revenue that one customer can spend with the bank directly
or through referral, recommendation over a nominal period. A customer who avails the services
from the bank is probably doing so as a tribal. The more frequently they come back to bank the
more their loyalty builds; they will then turn from a one-off customer into an ongoing client and
eventually a self perpetuating advocate. A loyal customer will often pay more as well; they will also
be less sensitive to tactical discounting so that they will actually have more profitability than the
customers that the bank can attract through special promotion offers.
31
Relationship Banking
A new approach to the marketing of bank services that is receiving growing attention in banks is
―relationship banking‖. The emphasis here is on viewing the customer as a long term business
relationship rather than confining attention to particular transaction. Banks make strategic plans
to meet the total banking requirements of the customers and expect business repeat from them.
For building up profitable customer relationship, it is inevitable on the parts of the bankers, first
of all to know more about the customers and his banking needs and toward this end, banks need
to prepare customer profiles.
Customer Service Model
Customers who contact any bank, wants two things :
They need a solution to a problem relating to investment/ credit.
They want to feel in some way ―special‖
Looking at number one, when the bank is providing appropriate solution for the problem, say,
Offering a loan for purchase of house, car or motor cycle.
Keeping the amount in savings/ term deposits suiting to need of the customer.
Issuing a demand draft the customer‘s need are satisfied.
Very often the only time that customers contact the bank is when they have a problem with
some services that they have availed/they want to avail—say
Delay in getting a loan
Delay in getting a term deposit report
Delay in getting a demand draft,
The second element of any customer service satisfaction model is that each and every single
customer has to feel some way special.
32
Speed and Time :
Speed and time measures are very important factors to many customers. The speed with which the
bank offers their services will actually gain advantage and allow them to offer higher satisfaction.
On account of technological revolution at present products are offered to take care of the element of
―speed and time‖ like
Internet and mobile banking
Debit cards
Anywhere banking
ATM etc.
Personal interaction with customers :
How well and able a does this, varies from small to the large. Small matters like remembering a
customer‘s name, a tone of voice and remembering details about the customer including his date of
birth date. There are certain banks who identify every opportunity that they possibly make the
customer feel unique and an individual. The frontline staff should be trained to answer the
telephone calls and deals with the customers face-to face, to treat every single customers as not their
only customer but their most important customer.
Courtesy And competence :
Common courtesies and manners are very important, probably more important than the banks may
consider. Competence means that whoever serve the customer or whoever supports people that
serves customer has to do things and do them well. It means getting things done rightly at the first
time. It means knowing what should be done and how best it can be done. courtesy and competence
hand to hand—it is a license to keep customers for life time.
Expectations :
A successful banker will be judge by his ability to manage the expectation of his customer well and
they systematically and consistently exceed them. A delighted customer will come back to the bank,
will convey his friends about his experience and will become n ambassador for the bank‘s
business—an unpaid sales person.
33
A satisfied customer is one whose expectation are equal to the experiences.
Where the expectation of a customer is less than the expectation, he becomes annoyed and
impatient and move as a dissatisfied customer.
Information and keeping the customers informed :
One of the simplest ways to keep the customers feeling special and make them feel important is to
keep them informed. They should be informed of things they are waiting for and let them know
how things are going on.
Attitude and customer liaison :
One of the most important aspects of attitude is when the customer is dissatisfied and one of the
most important and outward expression of attitude is the verbal and non-verbal behavior that people
use at critical times. The attitude that will work – the banker should instill it—is that every single
customer is his most important customer. Instead of seeing a customer for the transaction value that
they spend at that time or for the nature of their enquiry, the banker should try to see him as a
million dollar customer, somebody who has access to a large revenue, either through their direct
spending or indirectly through referrals and repeat business.
Long term relationships :
A customer will special if the banker will actually reward, recognize and encourage his loyalty and
in the long run either personal or business, given the right elements and environment he would
prefer to be consistent.
When put together, each one of the above seven elements will accelerate customer satisfaction
beyond even their wildest dreams. The customer will increasingly more loyal and profitable if the
banker begins to implement ideas based on around the seven elements and make them a constant
focus of attention.
34
Customer complaints :
Like in any other business organization, in banks too there are machineries for dealing effectively
with customer complaints. Successful customers are those that have realized the prompt attention to
customer complaints is an essential ingredient of a profitable customer relationship. ―A satisfied
customer is the best ambassador‖. What is equally worth nothing, however is that just as a satisfied
customers tells others about it, an unhappy customers too tells others about his experience, and
indeed more so.
In service organizations like banks, handling of complaints should be a high priority item.
Following are some of the strategies for effective redressal of customer complaints :
Complaints/complainants to be received and attend by their senior level, well experienced
functionaries.
Sincere efforts should be made to understand the nature of the complaint; the person
handling the complaint should be always be attentive.
Any irate customer, in particular, to be tactfully handled.
The complaints should not be given the impression that the bank officer is too anxious to get
rid of him.
Complaints should not be made to run from pillar to post; he should be guided to the right
person/department. No customer like to repeat his grievances to several person in the
organization.
The customer should be made available adequate information apart from factual details.
The customer should not be driven to approach the authority outside the bank, customer
organization etc. such instance will surely cause considerable damage to the bank‘s image.
Phony or biased calls should also to be handled with tact, sincerity and patience.
35
Who are HNI customers ?
They are high net worth individual customers
They are the major target for the private bankers.
Banks provide premium class facilities top these clients and tries to cater their special needs
related to financial and non financial in nature
They are high profile customers.
They have income of above Rs10 lacs per annum
A customer who can maintain at least a very high amount in their account.
Bank tries to maintain long term relationship with these clients.
How to approach HNI customers ?
Approaching to prospective customer is very important for any organizations. If banks rightly
approach customers than a long term relation can be expected.
Following are the steps how a bank approaches to HNI customers :-
Data Collection : Normally banks maintain their data bank, which is collected from various
sources like credit card holders, different account holders primary data, yellow pages, directories
etc.
Tele Calling : Once the data is collected , than the tele callers call upon these contacts and make
the clients aware about various facilities provided by the banks. If the client shows their inclination
then an appointment is fixed with these clients and the relationship manager visit the clients.
36
Role of Relationship manager : This appointment is called as a LEAD. This lead is transferred to
the relationship manager and the client is approached personally. Relationship manager explain the
facilities provided and additional needs which can also be fulfilled by their services. If the client is
convinced the lead converts into the customer form.
Corporate Banking : Relationship manager analyze the requirement of customers and provided
the best suited products. Relationship manager explain the various investment options available in
the market and give the customer the opportunity to select the option which is suitable to him.
Portfolio Management : If the customer has invested then the role of the manager is to design his
portfolio keeping in mind the risk and return factors, and provide requisite information about the
investment opportunities available in the market according to the profit of the customers.
Handling queries : Frequent services and time to time updating of market circumstances are shared
with these customers. the relationship manager with the help of other officers clarifies their doubts
and queries are handle with special care.
Mainly my work is to deal with HNI customers and to find out the interested potential customer for
opening the account in IVBL. I had convinced them to build a new and healthy relationship by
opening the account. Instead of covering all the areas, I have to decided to select three important
sectors.
Gems and Jwellery industry
Builders industry
Local Businessman
I have selected the first two sectors. They are booming sectors of the market. These two sectors are
my suspects. Suspects are those persons who might buy the products and will be ready to open the
account in IVBL. Then I have determined the most likely prospects from these suspects through
telecalling and explaining about the features of accounts. Prospects are those persons who are
interested in opening an account. By opening the account and building relationship they became the
first time customers. these three steps can be referred as customer development process.
37
CURRENT ACCOUNT
Basically a current account is opened for artificially created entity. This artificially created entity
can be a firm, sole proprietorship, association, partnership or any thin else. No interest is paid on
the current account. The bank charges some nominal amount for the transactions that takes place.
Tools for opening a current account
Walk in—there was a huge numbers of walk in customers in IVBL, we used to open their current
account.
References – References were being collected from the leads which we were having and from other
sources like chartered accountants, relatives, friends etc.
Cold Calls – This refer to telephonic call which we used to make, we used to make appointment
before approaching the person.
Hot Calls – This refer to direct face to face calls which we used to make without taking any prior
appointments.
Database – The various databases provided by the IVBL itself, which includes directories, yellow
pages etc.
Procedure of opening of an account is as follows :
Preparing the proposal.
Meeting to the owner of any firm, organization or any individual, giving him the proposal,
telling him the benefits which an individual or a firm will derive after opening its account in
IVBL.
Seeking permission of opening an account.
Filing up of form and completing the necessary documentation.
38
IVBL and Current Account :
We at ING understand that every Business has unique requirements. At ING, we will
offer you a solution suited to your business.
Whether you have a small/ mid/large size business or you are a company with its spread across
multiple locations in the country, you would find a Current Account that's just
suited to your business requirements. With features ranging from Free DDs, Free Cheque
Collection, Free At -Par Cheque facility to Free Trading Account & free Demat Account,
and a lot more .
ING Vysya Bank Limited has various current account to match the different needs of the
businessman. All these accounts are designed to suit the various needs of businessman.
Type of Current Account in IVBL:-
Orange Current Account
Advantage Current Account
General Current Account
Comfort current Account
Flexi Current Account
Orange current account
In today's fast-paced world, your business regularly requires you to receive and send funds to
various cities in the country. ING Orange Current Account gives you the power of inter-city
banking with a single account and access to more than 200 cities.
From personalized cheques that get treated at par with local ones in any city where we have a
branch, to Free collection (if instruments are lodged directly) of outstation cheques (payable at
branch locations), to free inter-city funds transfers of up to 200 lakhs per month, our priority
services have become the benchmark for banking industry.
39
Features and Benefits :
Free remittance limit (DD /PO /RTGS /EFT / NEFT) of Rs.2 cores per month; power
packed feature with potential to save up to Rs.4.8 lakhs per annum.*
Free collection of outstation cheques drawn on ING locations
Free unlimited payable at par (PAP) Cheque Payments
Free mi-b@nk Internet Banking facility *
Free unlimited transfer of funds within the bank
Free easy anywhere cash deposit up to a specified limit and withdrawal.
Free issue of personalized cheque book (including PAP cheques).
Avail safe deposit locker facility (where available) on a preferential basis.
Free usage of ATM Network: The international debit card provides for unlimited usage in
ING ATMs.
Free ATM cum debit card with access to any ATM of any bank.
Free 24 hours Customer Service Line (toll free).
Eligibility
Resident Individuals
Hindu undivided family
Sole Proprietorship firm
Partnership firm
Limited Companies
Trust
Association/Club/Societies
Foreign nationals residing in India
40
Documentation
4 Passport size photos
Identity proof
Residential proof
All we need is to maintain an average balance of Rs. 1,00,000/- per quarter. (Non-maintenance of
which entails a charge as per the following:)
When the QAB is less than 1 lakh there is a service charge of Rs. 4000/- per quarter. Besides, free
facilities become chargeable as per schedule of service charges.
Advantage current account
In today's fast-paced world, your business regularly requires you to receive and send funds to
various cities in the country. ING Advantage Current Account gives you the power of inter-city
banking with a single account and access to more than 300 cities.
From personalized cheques that get treated at par with local ones in any city where we have a
branch, to Free collection (if instruments are lodged directly) of outstation cheques (payable at
branch locations), to free inter-city funds transfers of up to Rs.50 lakhs p.m., our priority services
have become the benchmark for banking industry.
Features & Benefits:
Free remittance limit (DD/ PO/ RTGS/ EFT/ NEFT) of Rs. 50 lakhs p.m.; power packed
features with potential to save upto Rs.1.20 lakhs p.a. Free collection of outstation cheques
Drawn on ING locations.
Free unlimited payable at par Cheque payments.
Free unlimited transfer of funds within the Bank.
Free easy anywhere cash deposit up to a specified limit and withdrawal.
Free issue of personalized cheque books and personalized payable at par cheques
Free SMS alerts
Free standing instructions facility for regular payments
41
General current account
A Current account is ideal for carrying out day-to-day business transactions. With the ING General
Current Account, you can access your account anytime, anywhere. Withdraw and deposit cash,
issue and encash cheques, make balance-inquiries or ask for mini statements, and even request for
cheque books any time, anywhere.
With a vast network of branches in cities all over the country, and access to a multitude of ATM's,
you can keep track of all your transactions anytime.
Features & Benefits:
Access your account from any of the networked branches across India
Deposit cash at any of the branches (networked) across India
International debit card cum ATM card to access your account from the wide network of
ING
ATMs and self banking across the country
Enjoy FREE 24- hour Phone Banking and Net Banking facilities that helps you check your
balance and other details
All we need is to maintain an average balance of Rs. 10000/- per quarter. (Non-maintenance of this
balance entails a nominal charge of Rs. 750/- per quarter).
Comfort current ac
ING's Comfort Current Account lets you save as much as Rs. 60,000 p.a. for remittance up to Rs.
25 lakhs. This is in addition to a range of other attractive benefits, as well.
Features & Benefits:
Free remittance limit (DD /PO /RTGS /EFT / NEFT) of Rs.25 lakhs per month.
Free Collection of outstation cheques drawn on the branch locations/centers.
Free Mi-b@nk Internet Banking Facility.
Free anywhere cash deposits: Up to Rs.25, 000/- per day. Maximum 4 transactions
Rs.1.00 lakh per month
Account-to-account funds transfer: Free unlimited transfer of funds from one account to
another account within the Bank.
42
Flexi current ac
We at ING understand that your Business needs change with season and hence your Banking
requirements will also be different. We now have a solution to your seasonal needs - ING Flexi
Current Account is the answer to your changing banking requirements during peak seasons.
With ING Flexi Current Account your Cash Deposit limits, and remittance limits are a multiple of
the balance you maintain in your Current Account.
Flexi Current Account requires you to maintain a minimum Monthly Average Balance (MAB) of
just Rs. 50,000.
Features & Benefits
1. Flexi Current Account has two variants:
Flexi Now – Free limits in same month (The charging and free limits will be basis MAB
maintained in the same month).
Flexi Next - Free limits in next month (The charging and free limits of any month will be
basis MAB maintained in the previous month).
2. Base Location Cash deposit Limits (self and third party combined):
12 times MAB maintained + Rs.2.5/- per 1000 (beyond free limits).
3. NEFT/RTGS/ DD/PO
Free limit up to 100 times MAB maintained.
Above free limits, transaction level charges will apply for NEFT /RTGS & For DD/PO,
charges @Rs. 0.50/-per Rs.1000.
The Free limit is applicable across NEFT/RTGS/ DD/PO.
3. Cheque book
100 cheque leaves free per month for MAB of 50,000; post which 100 cheque leaves free
per additional 1 lakh maintained. Maximum 1000 cheque leaves Free in a month.
43
Savings Account :
Orange Savings Account :
Features & Benefits:
Quarterly Average Balance (QAB) of Rs. 5000/-, Rs.10,000/-
QAB requirement at Rs.10,000/- for Delhi NCR, Mumbai, Bangalore, Chennai, Hyderabad
& Kolkata
Free issue of the International Debit Card for the 1st year.
Shopping convenience at over 2,00,000 merchant locations, with the ING Vysya
International
Debit card.
Other Features
Unlimited ATM transactions across all Maestro Cirrus ATM‘s
Unlimited ATM transactions at over 356 ING Vysya ATM's.
2 Demand Drafts with a value not exceeding Rs. 50,000 per annum, where the QAB is
maintained.
Unlimited usage of payable at par (PAP) Cheques.
Transfer of funds across all branches.
National Electronic Funds Transfer (NEFT) through the internet banking channel.
Electronic Bill Payment service.√
Statement of Account through E-mail.
Mi-b@nk - Internet banking facility.
RTGS (Real Time Gross Settlement) transactions at all branches.
AAA Cash deposit (Customers) - Free up to 2 transactions per month and a value limit of
Rs. 50,000/-.
Up gradation from any other savings account of the Bank to the Orange Savings Account at
no additional cost.
44
Zwipe Classic Savings Account :
Features
Quarterly Average Balance of Rs 20000/-.
Issuance of upto 10 demand drafts summing upto Rs 5 lacs per month without charges/
commission. 25% off on locker charges for 1st year.
Free zero balance zing account for the customer‘s child.
Zero account opening charges for demat and online broking account.
Waiver of AMC charges for 1st year on demat account.
100% waiver of surcharge on purchase of petrol across any fuel station in India.
Anywhere banking across all branches
a. Free unlimited usage of ING and other bank ATMs and self bank kiosks without charges
b. Enhanced ATM cash withdrawal limit of Rs 50,000/- per day in own ATMs/ other Bank
ATMs.
c. Zero charges on anywhere cash deposit upto Rs 50,000 per day.
Benefits :
Free issuance of ING Zwipe Classic international debit card.
Free Internet Banking facility.
Free collection of outstation cheques drawn on IVBL locations.
Free Inter-city transfer of funds (A/c to A/c with IVBL)
RTGS/ NEFT inward – free, outward-as per tariff.
45
Aspira Corporate Solutions:
Aspira makes the complicated corporate world a bit easier.
By giving you simple inputs and easy ways of taking care of your money.
Along the way, you'll notice how Aspira helps you manage your money, letting you live the fuller
life, easily.
Benefits – Employers
Automated salary upload
Dedicated service manager for on-boarding & support
Reimbursement account attached to each salary account
Meal card to replace physical coupon process
Complimentary upgrade to ING Platina Preferred Banking for senior employees
Dedicated ATM or Self Banking Kiosk in office premise for select companies
Special pricing on loans (based on company categorization)
Benefits – Employees
2-in-1 zero balance account with reimbursement account - single debit card
Instant account opening - cheque book, ATM card issued in office
Priority servicing at any branch
Meal card that can be used to pay for food items
Free bill payment & fund transfers on Mi-b@nk internet banking
Free unlimited PAP cheques with automatic reorder
Preferred interest rates on loans and zero/discounted processing fee
24X7 access with Phone, Internet & Mobile banking
46
ING Zing - the Saving Account for your kids
Learning yet fun, freedom yet responsibility, let your child learn banking the fun way with ING
Zing Savings Account and its exclusive features.
Personalized debit card for your kid.
Keep a control on your kids spends by setting the spend limits.
Fabulous discounts on books, toys and more leading brands
Teach your kid how to be good with money in a fun way with Zing
You can help your child invest money monthly
Automatically transfer funds at predefined intervals to your child's account.
Access to ING's financial planning services to safeguard your child's future.
Free view access to Internet and Mobile Banking.
47
RESEARCH METHODOLOGY
Title of the study :
―CUSTOMER RELATIONSHIP MANAGEMENT IN INDIAN RETAIL BANKING‖
Objective :
To understand the Indian Banking System.
To understand the retail trends followed by the retail banks.
To understand the banking relationship of an organization with their existing bankers.
Product innovation for them.
To generate business by generating leads.
Type of research :
Research Design Descriptive
Research Sample 100 Customers
Method of selecting sample :
Questionnaire
The data was collected through questionnaire, in which different question were asked.
48
Scope of study :
My study will help to understand the Indian Banking System as well as to identify the
existing bank ―marketing reputation‖.
My study will provide l information about general practices adopted by the various banks in
order to carry their customers in the area of retail banking business.
Limitation of the study :
Due to time constraints the research was confined to Rourkela only.
Sample size is very small.
Some of the respondents show biasness and provide wrong information.
Some of the respondents do not cooperate and are not interested in answering.
49
ANALYSIS AND DATA INTERPRETATION
Interpretation :
As it can be predicted from the graph, 90% of the people have their savings account in SBI.
Most of the consumers have their savings accounts in nationalized banks as they found
nationalized banks were very safe and trust worthy. The other major players are Punjab
National Bank and Central Bank.
0
10
20
30
40
50
60
70
80
SBI
PN
B
CEN
TRA
L B
AN
K
Alla
hab
ad B
ank
Uco
Ban
k
Ban
k O
f B
aro
da
Axi
s B
ank
ICIC
i Ban
k
Syn
dic
ate
Ban
k
Ind
us
Sin
d B
ank
HD
FC B
ank
Ban
k o
f In
dia
OB
C
Cit
i Ban
k
An
dh
ra B
ank
can
ara
ban
k
Savings accounts
Savings accounts
50
2. REASON BEHIND THE RELATIONSHIP WITH BANKS
Interpretation :
Most of the consumers have relationship with their existing bankers because they have very
long term and past relationship with their banks and they are quiet satisfied with their
services. Another reason for the relation is safety. Out of 100, 50 favored past relationships
and 25 favored safety as their reason.
Safety 26%
Past Relations with Bank 51%
Proximity to office 15%
Others 8%
51
3. FACILITIES PROVIDED BY THE BANKS AND USED BY THE CONSUMERS :
Interpretation :
Each is using branch facilities. The other facilities used by them are phone banking and
internet banking.
0
10
20
30
40
50
60
70
80
90
ATM Branch InternetBanking
Tele Banking Door StepBanking
Banks Provided
Facilities Used
52
4. AWARNESS OF SERVICES PROVIDED BY BANK :
Only 18 customers out of 100 are aware of a auto swap facilities, and 8 are availing it. 31 are
aware about at-par cheque book facilities and 30 are availing it, as bank doesn’t charge any
amount for these facilities. 30 is availing credit card and 11 is from investment advisory
services.
0
10
20
30
40
50
60
70
80
90
100
Auto swep in FD At Par Cheques Credit cards Investmentadvisory
Awarness
Availed
53
COMPARATIVE ANALYSIS OF ACCOUNTS WITH COMPETETIVE BANKS
Today is the world of competition. In this competitive scenario, each and every company has to
keep an edge on its competitors. To help this out , I have done comparative analysis of different
banks and their service keeping in mind the features and services of ING Vysya Bank Limited. I
have done comparative analysis so that I can be able to know about the competitors services. This
will help me out to handle customer queries and make them understand how ING Vysya Bank is
different and better than other banks. This analysis will help to convince the customers easily for
creating and building a new and fair healthy relationship with ING Vysya Bank.
Procedure adopted for comparative analysis :
Study and understood the service provided by ING Vysya Bank Limited in its current
account and savings account
Visited various banks and gather information about the services through
Personal interview
Internet
Brochures and Pamphlets
Questionnaire
Now along with ING Vysya Bank, I had visited various others banks also to know the differences in
the financial products being offered by them and by doing that, I come on to the following
comparison
54
COMPARATIVE ANALYSIS OF ING WITH COMPETITIVE BANKS :
S.No Features/Bank ICICI HDFC AXIS ING
VYSYA
1. Minimum AQB Rs.10,000 Rs.10,000 Rs.10,000 Rs.5,000/
10,000 for
metro cities.
2. Unlimited Transactions
across all ATMs
No No No Yes
3. Unlimited usage of PAP
with auto- reorder facility
No No No Yes
4. Daily ATM Withdrawal
Limits
Rs.50,000 Rs.50,000 Rs.50,000 Rs.25,000
5. Service charge in case of
non maintenance
Rs.300/-per
month
Rs.750/- per
quarter
Rs.700/-
per month
650/- per
quarter
6. Free DDs Free upto Rs.
100000/- above
that denomination
wise charges;
Rs.50/- per
transactions
DDs free
upto a limit
of
RS.25000/-
per day
savings plus
Rs. 100,000
per day
savings max
Free upto
Rs 3 lacs,
above limit
Rs 1.00 per
Rs.1000
2 DDs upto
Rs.50,000
per year
7. AAA cash Deposit self Upto Rs.100,000
or above
Free upto
Rs.50,000
Free limit
Rs.3 lacs
per month
2 free
transaction
upto
Rs.50,000
per month.
55
8. Auto sweep FD No No No Yes
9. International Debit Card Charged Charged Charged 1st year free;
2nd
year
Rs.150+S.T
10. Net Banking, Phone
Banking, Mobile Banking
Charged Rs.30/-per
statement
Charged Free
11. Inter Branch Banking Charged Charged charged Free
12. E-bill payment service yes yes yes Yes
13. Dedicated toll free
number and call back
facilities.
yes yes yes Yes
14. Amazing offers and
discounts at retail outlets,
restaurant, spas, tours and
travels and more
yes yes yes Yes
56
SWOT ANALYSIS OF ING VYSYA BANK :
Strength Weakness
ING, as one of the biggest financial
institute across the globe, 12th
on
fortune global 500 list.
ING is the only foreign bank which has
acquired an Indian private bank (Vysya
Bank)
Client base is more than 85 million.
Track record of high growth and
profitability
Ranked among top 5 private sectors
bank in India by Brand Equity—
Nielson Survey 2011
Very few branches.
Less variety of financial/banking
products.
Lack of customer awareness regarding
services and bank because of low
advertising.
Very limited branches in North India.
Less ATM network in the country
Opportunities Threats
Increase in different kind of financial
products
Growth in business sector is one of the
added advantage to increase their
business.
Venture into the untapped markets by
setting up new branches in various
cities.
Presence of two top private banking
player in the market (ICICI & HDFC)
Impact of negative global disaster in
the Indian economy
Fluctuation in monetary policy
57
CONCLUSION
Limitations of Retail Banking :
The bank into retailing will have to face following bottlenecks in its operations.
Huge sales and promotion expenditure
Managing human resources
Managing technology
Pressure on margins
Attitude hurdles
Huge sales and promotion expenditures :
In order to survive in the world of fierce competition with so many players, each bank has to incur
huge amount of funds on sales and promotions. No bank can deny this expenditure because they
need to build their image among the customers to get business.
Managing Human Resources :
Retail Banking caters the needs of individual customers. For this purpose qualified and trained staff
is needed to be maintained, for training those employees bank spend a huge amount of money.
Sometimes their trained personnel leave the job halfway which increases the expenditure of the
bank. Apart from this bank also have to maintain various cells regarding customer grievance,
employees grievances etc. which again increase the expenditure of the bank.
Managing Technology :
Technology plays an important role in retail banking. Today majority of transactions in banks are
done through ATMs, mobile banking, internet banking. For this purpose effective and efficient
management of technology is necessary. Managing technology incurs huge expenditure which
sometimes create problem for the banks to accumulate funds for these purposes.
58
Pressure on Margins :
To retain the existing customer base as well as to expand, the bank are pressurized to keep the
minimum prices possible. Thus the bank have huge pressure on margins.
Attitude Hurdles :
Earlier the major player in the banking industry were public sector banks. But due to the advent of
liberalization and globalization, private and foreign sector banks have come up which has resulted
into a drastic changes in Indian banking scenario. With these banks the latest technology has also
come up. But still a huge chunk of people does not avail its benefits. People still prefer going to
bank and carry out the necessary paper work when the same thing can be done very easily through
mobile phones and internet. Thus people from rural areas should be given proper education and
should be educated and their attitudes need to be changed since, it is a major hurdle for the growth
of the retail banking products.
This study has helped me to know about the whole functioning of one of the major pillars of our
economy which is banks. With the advent of globalization and liberalization new way to improve
customer relationship has emerged in front of the banks. This new ideas will help them in acquiring
new customers and maintaining the existing customer base. One of the fastest emerging tools with
banks to improve up on customer retention and satisfaction in retail banking and by adopting this
many banks have achieved growth in their business like never before.
Suggestions and Recommendations. :
IVBL should chalk out some programmes to create general awareness regarding its presence
and various services of bank. More attention is required in distant located firms/areas and
cater the needs of those commercial areas.
Personal marketing/aggressive marketing:--Today in the era of competition, in order to
increase the banking network (in term of clients and business volume) an aggressive
approach is required. The bank should recruit more number of personnel, so that they can
cover the whole of the city. Personal marketing can be one of the methods or mode of taking
people into confidence.
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Promotional Campaign :-- In the era of stringent competitiveness one has to take care of
promotional activities. It can be done in following ways.
Promotion through customers – Through motivating the existing customers to get more
business can one of the modes to have greater access or approachability. The motivation to
the customers can be through gifts or through memento.
Reference Selling – Few of the bank‘s customers especially esteemed ones can be asked to
give reference about relatives, friends or any acquaintances, that they consider potential
customers. thus the business volume can be increased.
Advertising – Initially when we took our work we found that general awareness amongst
people regarding IVBL was very low. The bank should instead of being centrally advertised,
try to advertise locally. This can be done in following ways.
Public welfare banners – An excellent way to advertise which can be done through tree
guards having IVBL name.
Traffic posts – Especially at commercial locations can have IVBL boards or banners.
One or two neon board can be put at the centre place of Rourkela.
Ad-campaign through FM radio, hoarding, Television etc.
The bank should open more ATM network.
The bank should come up with more branches in Rourkela and other major cities of Odisha.
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Questionnaire
Name : ___________________________________________________
Name of occupation : _____________________________________
(a) Salaried ( )
Government Semi Govt. Private
(b) Self employed ( )
Lawyer Doctor Engineer
Architect Builder Consultant
Other please specify ________________________________________
Q1) In which bank you are operating your savings account ?
________________________________________________
Q2) In which bank you are operating your current account ?
__________________________________________________
Q3) How much minimum balance or average quarterly balance you have to maintain in your
account ?
Savings Account _______________________
Current Account _______________________
Q4) Why you chose this bank ?
Past relationships Brand name
Near to home/office others please specify --------------------------
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Q5) Are you satisfied with the services provided by your bank ?
Yes NO
(i) If yes what core benefits you are availing from your bank ?
Home banking (Free/Charged)
Net banking (Free/Charged)
Phone banking (Free/Charged)
At-par cheque book (Free/Charged)
Global debit card (Free/Charged)
Demand draft (Free/Charged)
Auto swep FD (Free/Charged)
24 hrs ATM (Free/Charged)
Additional savings account (Free/Charged)
Others please specify ___________________________________________
(ii) If no why ?
________________________________________________________
Q6) What exactly you are looking for in your bank ? please write your expectation.
______________________________________________________________
______________________________________________________________
Adress ____________________ Phone No _______________
______________________________
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Q7) Which one of the banking facilities does your bank provides you and which one does you use ?
Facilities Provided Use
Branch Banking
Internet Banking
Mobile Banking
Door step Banking
Free ATM
Q8) Are you aware of following services provided by the bank ?
Auto sweep into FD ____________________________
At par cheques ________________________________
Credit Cards _______________________________
Investment Advisory ____________________________
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BIBLIOGRAPHY
Textbooks:
1. Marketing Management: 13th
Edition A South Asian Perspective
Philip Kotler, Kevin Lane Keller, Abraham Koshy, Mithileshwar Jha
2. Marketing Management
Arun Kumar, N Meenakshi
Websites: www.ing.com
www.ingvysya.com
Newspaper: Economic Times