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SIGNATURE PAGE

1

“Adding ValueProposition to theCredit Card of Nepal

Investment Bank Ltd.”

Project Submitted toSouth Asian Institute of Management

Submitted By:

BINITA MITTAL

5th termSouth Asian Institute of Management[25th July. 2010]



I hereby certify that this report has been thoroughly read by me and that it

is satisfactory in all aspects.

_________________

Ram Raj Upadhyay,

Branch Manager,

Nepal Investment Bank Ltd.

COPYRIGHT

2



Copyright © All rights reserved. No part of this publication may be

reproduced, stored in a retrieval system or distributed in any form by any

means, electronic, mechanical, photocopying, recording or otherwise,

without the written permission of the publisher and copyright owner.

Unauthorized export of this project is violation of the Copyright Act 2005.

Violation of this law is subject to Civil and Criminal penalties.

Author: Mrs. Binita Mittal

Copyright © 2010, South Asian Institute of Management

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DISCLAIMER

The authors are confident that the results of the analysis and the results

presented in this report will be taken as guidance for a more comprehensivestudy in the future date. The authors are not responsible or liable, legally

against the results and consequent decisions based on the responses

received from the analysis of the report.

The views expressed in this report are those of authors only.

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ACKNOWLEDGEMENT

We have been fortunate to have full cooperation of many people during the

duration of our project. We would like to extend our heartfelt gratitude to all

people Nepal Investment Bank Ltd. for their help and support.

We are thankful to all the people who helped us by filling questionnaires and

by providing us adequate information through interviews. We would also like

to extend our gratitude to SAIM Library for providing us with the required

literature.

Finally, we extend our sincere gratitude to Prof. Bijay KC (Course Instructor),

for his continued guidance and support throughout the project.

This page is specifically designed to note our appreciation of those people

who stand out most notably in our minds during the duration of the project.

We are grateful to them all.

Binita Mittal

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EXECUTIVE SUMMARY

This market research study was carried out to determine the factors that

add value of the credit card. This research study was chosen among many,after thorough evaluation of several market research related topics given to

us by Nepal investment Bank Limited. This was primarily due to the

understanding of the fact that due to increase in competition in the banking

sector, satisfaction to customers in all the products provided by the bank

has become very important. Customer did not seem to be very satisfied with

the facilities provided by the credit card because of which there is no

frequent use of credit card So to dissect this management decision problem

by means of research this research project has been undertaken.

Both exploratory as well as descriptive researches were conducted. Initiallyto find out the problems that needed to be tested in the sample population

were derived from interviews and observation. Those information’s

highlighted the issues that those customers had with Credit card. It also

highlighted the factors that would help increase the value of credit card and

the factors that would help increase the frequency of its use .The

information was again cross checked from the management and formed in

questionnaire. The questionnaires were distributed among few customers to

check its short comings. Then the needed modifications were made and

distributed through self monitoring to the sample customers. Majority of thefindings are based on the Questionnaire survey and interviews conducted.

After this, the tool was designed, tested and administered. The hypotheses

were tested using SPSS and finally the conclusions were drawn based on

which recommendations have been given.

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ContentsSIGNATURE PAGE ................................................................................................... 1

COPYRIGHT ............................................................................................................ 2

DISCLAIMER ............................................................................................................ 4

ACKNOWLEDGEMENT ............................................................................................. 5

Binita Mittal............................................................................................................ 5

EXECUTIVE SUMMARY ............................................................................................ 6

Contents .................................................................................................................... 7

Literature Review ................................................................................................... 8CHAPTER 1 .............................................................................................................. 11

1.1 BACKGROUND ................................................................................................ 11

1.1.1. Objective of the study ................................................................................ 11

1.1.2. Importance of the study ............................................................................. 11

1.1.3. Limitation of the study ............................................................................... 12

1.1.4. About the company .................................................................................... 12

1.2 ISSUE: ............................................................................................................. 13

MDP: ..................................................................................................................... 13

1.4 MRP: ............................................................................................................... 14

1.5 RESEARCH QUESTION AND HYPOTHESIS FOR NIBL ........................................ 14

1.6 CONCEPTUAL FRAMEWORK ............................................................................ 16

Fig: REPEAT – PURCHASE MODEL ............................................................................ 16

CHAPTER 2 .............................................................................................................. 19

2.1. RESEARCH METHODOLOGY .............................................................................. 19

2.1.1. Population .................................................................................................. 19

2.1.2. Definition of the information needed ......................................................... 19

2.1.3. Measurement and scaling Procedures ........................................................ 20

2.1.4. Questionnaire Design ................................................................................. 20

2.2. QUANTITATIVE RESEARCH ............................................................................. 20

2.2.1. Sampling Process, Sample size and Sampling Frame ................................ 20

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2.2.2. Field Work / Data Collection ....................................................................... 20

2.2.3. Data Preparation and Analysis ................................................................... 21

CHAPTER 3 .............................................................................................................. 22

3.1 DATA ANALYSIS FINDINGS .............................................................................. 22

3.2 CONCLUSION .................................................................................................. 28

3.3 RECOMMENDATION ........................................................................................ 29

Literature Review

A credit card is a system of payment named after the small plastic cardissued to users of the system. In the case of credit cards, the issuer lends

money to the consumer (or the user) to be paid later to the merchant. It isdifferent from a charge card, which requires the balance to be paid in fulleach month. In contrast, credit cards allow the consumers to 'revolve' theirbalance, at the cost of having interest charged. Most credit cards are issuedby local banks or credit unions, and are the same shape and size, asspecified by the ISO 7810 standard.

It is an undeniable fact that credit cards play an important role in oursociety today. For businessmen, business credit cards are a great help inseparating their personal accounts from their business accounts. It is aconvenient way to manage the company and the employee’s business

expenditures. It also makes accounting and tax monitoring easier throughupdated periodical reports of all purchases made.

The stiff competition among banks has given birth to a variety of classes of business credit cards, which can only mean bigger and better choices forcustomers. Deals are becoming more and more attractive, and clients aregiven more options and freedom to get the best service they need.

The vast number of business credit cards to choose from can causeconfusion for a prospective customer especially if everyone seems to beoffering a great deal. With all the excitement, it could be tempting to sign-

up to the first credit card offer that catches your attention, without evenconsidering the others. Whichever provides the best deal/ service customersgo for it. So the value of the credit card lies on the facilities provided by thecredit card.

Benefits of Credit Card

8

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

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

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

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

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

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

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

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

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

http://en.wikipedia.org/wiki/ISO_7810

http://www.businesscreditcardsite.com/

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

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

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

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

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

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

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

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

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

http://en.wikipedia.org/wiki/ISO_7810

http://www.businesscreditcardsite.com/



Credit card can be used to get the statements to keep track of exactly howmuch you are spending and where your money goes. With some creditcards you can use personal finance software to download your credit cardtransactions from the Internet right to your home computer.

Credit cards may actually save you money. Some people avoid makingpurchases if they do not have cash. Cash seems to "burn a hole" in ourpockets, it just disappears. It is so easy to spend and it is right there. But acredit card takes more effort and you know that you have to pay the billlater that month.

Your credit card may also offer a rewards program where you get cash back,frequent flyer miles or discounts on services and merchandise.

Credit cards are convenient. Some purchases, especially those on theInternet, will only accept credit card payment. Also you don't have to

continually go to the bank or ATM to get cash.

A credit card also provides a measure of safety. You don't have to carrylarge amounts of cash for large purchases. Even if your card or credit cardnumber is stolen, you are not responsible for the thief's use of your card.

But credit cards can also be a crutch. Too many people see their credit limitnot as the maximum amount of debt they can go into, but as an account fullof money that they can spend.

Many people have developed the habit of using their credit cards to buywhat they want now and paying for it later. They then make only theminimum payments required. Often the minimum payment is set so thatyou only pay the monthly finance charge (interest) or just a small amountabove it.

Sometimes the credit card can lead a person into living a lifestyle that isbeyond their means. If a person gets in the habit of dining out two to threetimes a week and these meals are paid for by credit card, the card balanceincreases quickly. Often the additional expense was not planned or

budgeted. People can even end up spending more each month than theyactually earn.

This can continue as long as the credit card balance is below the limit andthe person makes their regular monthly payments. But as soon as the creditlimit is reached, many credit companies will increase the credit limit andgive the person more room to get into debt.

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Things to consider when you are looking for a business credit card

For instance, if your type of business entails you to make large purchases,

you will be most happy with a business credit card that offers cash backs onthese items. Usually along with cash back programs; they also have pointsystem rewards which entitles a customer to one point for every one dollarspent on the credit card. You can actually save a lot of money by buyingmore items which your business really needs.

If you are a frequent traveler, you can take advantage of free travelprivileges as your reward. You may also avail of discounts from affiliatedairlines, so it would be better if you choose the business credit card that haspartnership with the airline you regularly fly with.

Aside from the benefits listed above, added perks may include shoppingprivileges from affiliate merchants, or discounts from servicing outlets likeshipping, printing, mail deliveries, gas stations, etc. which are often theservices that businesses commonly use. Taking all these rewards andbenefits in consideration can earn your business a great deal of money

For merchants, a credit card transaction is often more secure than otherforms of payment, such as checks, because the issuing bank commits to paythe merchant the moment the transaction is authorized, regardless of whether the consumer defaults on the credit card payment. In most cases,cards are even more secure than cash, because they discourage theft by

the merchant's employees and reduce the amount of cash on the premises.Prior to credit cards, each merchant had to evaluate each customer's credithistory before extending credit. That task is now performed by the bankswhich assume the credit risk.

For each purchase, the bank charges the merchant a commission (discountfee) for this service and there may be a certain delay before the agreedpayment is received by the merchant. The commission is often a percentageof the transaction amount, plus a fixed fee. In addition, a merchant may bepenalized or have their ability to receive payment using that credit cardrestricted if there are too many cancellations or reversals of charges as a

result of disputes. Some small merchants require credit purchases to have aminimum amount to compensate for the transaction costs, though this isnot always allowed by the credit card consortium.

In some countries, for example the Nordic countries, banks guaranteepayment on stolen cards only if an ID card is checked and the ID cardnumber/civic registration number is written down on the receipt togetherwith the signature. In these countries merchants therefore usually ask for

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

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

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

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



ID. Non-Nordic citizens, who are unlikely to possess a Nordic ID card ordriving license, will instead have to show their passport, and the passportnumber will be written down on the receipt, sometimes together with otherinformation. Some shops use the card's PIN for identification, and in thatcase showing an ID card is not necessary

“The value of any product is felt by the customer if that product givessatisfactory service/ facility to the user. So is the case with the Credit card.The value proposition of the credit card lies on the facilities it provides.More the facilities to the customers more will be its value.”

CHAPTER 1

1.1 BACKGROUND

1.1.1. Objective of the study

The main objective of the study was to identify and analyze the factors or

the unique features that contribute to the satisfaction of credit card users

leading to increase in frequency of its use, through the use of various

marketing research techniques. Marketing Research as a field of study has

become the key strategic weapon for any organization to better understand

the market. This study aims to solve the problem of KUSOM through the

practical and theoretical understanding of this course.

1.1.2. Importance of the study

Today the banking sector of Nepal has seen a tremendous growth with

mushrooming number of commercial and development banks. There is a

tough competition brought in from the new entrants with their innovative

ideas and strong marketing sense. The commercial banks in Nepal have

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been fighting for their share of the pie with their respective competitors.

Due to the increase in number of financial institutions customers bargaining

power have increased. Customer’s satisfaction has become a very important

for every bank. Due to the busy schedules, customers look for an easier way

to get their things done. So which ever bank provides them with better

facilities they switch to that bank. Credit card is one product that bank

provides to its customer to make their work easier. Frequent use of credit

card is profitable to the bank. So identifying he factors that will satisfy the

customer with the credit card which ultimately leads to increase the

frequency of use of credit card. So the importance of this paper lies on

understanding the implication of Marketing Research regarding problem

identification and solution generation.

1.1.3. Limitation of the study

The main limitation of this research was the time management. As this

research was to be conducted within 3 months time, adequate time thatthese projects require could not be devoted.

For which, there might be some shortcomings in the paper because of us

not fully or adequately being able to implement entire marketing research

techniques.

1.1.4. About the company

Nepal Investment Bank Ltd. (NIBL1), previously Nepal Indosuez Bank Ltd.,

was established in 1986 as a joint venture between Nepalese and French

partners. The French partner (holding 50% of the capital of NIBL) was Credit

Agricole Indosuez, a subsidiary of one the largest banking group in the

world.

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With the decision of Credit Agricole Indosuez to divest, a group of

companies comprising of bankers, professionals, industrialists and

businessmen, has acquired on April 2002 the 50% shareholding of Credit

Agricole Indosuez in Nepal Indosuez Bank Ltd.

The name of the bank has been changed to Nepal Investment Bank Ltd.

upon approval of bank’s Annual General Meeting, Nepal Rastra Bank and

Company Registrar’s office. The company believes that NIBL, which is

managed by a team of experienced bankers and

NIBL1

= Nepal Investment Bank Limited

professionals having proven track record, can offer its customers what they

are looking for. It is sure that their choice of a bank will be guided among

other things by its reliability and professionalism.

1.2 ISSUE:Due to the competition prevailing in the Card industry, NIBL needs to do add

value to credit card to increase the frequency of credit card users.

MDP:How can NIBL add value proposition to the credit card.

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1.4 MRP:Identify the unique facilities that add value to the credit card?

1.5 RESEARCH QUESTION AND HYPOTHESIS FOR NIBL

RQ 1: Are the customers satisfied with the credit card of NIBL?

H1: Satisfaction of customers less than 3.

RQ 2: Have the customers faced any bad experience with the use of Credit

card of NIBL?

H1: The bad experience of credit card is less than 3.

RQ 3: Will the prior experience with the credit card of NIBL affect its usage

in future?

H1: The affect on usage is less than 2.

RQ4: What new facilities do the customers seek from the credit card?

H1: The customers seek for electricity bill payment from credit cards.

H2: The customers seek for phone bill payment (landline and mobile).

H3: The customers seek for water bill payment.

H4: The customers seek for ISP bill payment.

H5: The customers seek for school fee payment.

H6: The customers seek for discounts in payments from credit cards.

H7: The customers seek for free transaction service from the member

banks.

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RQ5: Will the addition of new facilities of credit cards increase its

frequency?

H1: Frequency of usage and phone bill payment facility is associated.

H2: Frequency of usage and school bill payment facility is associated.

H3: Frequency of usage and free transaction facility are associated.

H4: Frequency of usage and electricity bill payment facility is

associated

H5: Frequency of usage and discount on payments from credit cards

facility are

associated

H6: Frequency of usage and ISP bill payment facility are associated.

H7: Frequency of usage and water bill payment facility is associated.

RQ 6: Will the introduction of these facilities increase satisfaction?

H1: Satisfaction and phone bill payment are related.

H2: Satisfaction and school bill payment related.

H3: Satisfaction and free transaction service from member banks

facility is related.

H4: Satisfaction and discount while payment from credit card facility is

related.

H5: Satisfaction and ISP bill payment facility is related.

H6: Satisfaction and electricity bill payment facility is related.

H7: Satisfaction and water bill payment facility is related.

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1.6 CONCEPTUAL FRAMEWORK The various unique facilities in the credit card that customers seek for to

increase their frequency has been identified during the qualitative research

process. The facilities that customers look for in a credit card are electricity

bill payment , phone bill payment , water bill payment, ISP bill payment,school fee payment, discounts in payments from credit cards, free

transaction service from the member bank. These attributes which have

been identified lead to satisfaction of customers leading to increase in their

frequency of purchase. Customers are already aware of the credit card

issued by NIBL and the customers have already tried as well but due to the

cut throat competition prevailing in the Nepalese market NIBL needs to add

extra facilities in the credit card to satisfy the customers which will lead to

increase in the frequency of its use.

Consumer state

Unaware

Aware

Trial

1st repeat

2nd Repeat

Fig: REPEAT – PURCHASE MODEL

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Product features/

distribution/

relative price



Many new products are re-purchasable kind. These include virtually all the

non-durables consumed by the households and the factory. The sellers of these products are even more interested in the repurchase rate than in the

trial rate. A low trial rate could be attributable to poor distribution,

promotion, packaging which are correctable. Trial of a new product can be

stimulated by distributing free samples, introductory pricing and so on. But

a low re-purchase rate may suggest a product that does not meet the

consumers’ expectations, which is harder to correct. Unfortunately, early

aggregate sales figures do not distinguish between the two rates. A rising

sales curve could mean a high trying with a low re-buying rate (a

correctable situation).

The figure above shows that individual consumers facing a new

frequently purchased product.

If the consumer is unaware of the product then,

1. He must be made aware of the product of the company. Creating

awareness about the product can be done with advertising,

promotion and sampling which are the main tools the marketer has

control of here.

NIBL present costumers who are our sample population and on

whose answer basis our research is focused on are already

aware of the Credit Card issued by the bank. So this step is not

of the serious concern to NIBL to help them increase the

frequency of purchase of the credit card.

2. In this second step, consumer must be induced to try the

product of the company. Advertising should be done in such a

manner which induces the consumer to buy the product. This step

shows the effectiveness of the advertising and promotion done for

the product. Effective advertising and promotion leads to trial

phase.

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NIBL present customers are the sample population on whose

answer basis our research is based on. They are the costumers

who are already the present users of Credit Card. So the trial

phase has already been passed by the customers.

3. In this third step, consumer must be induced to repeat once.

Once the product is not disliked by the consumer or even if the

consumer is in the confusion state of the product where the

consumer are not sure if it was really good or not, they will be

induced to repeat once. The product quality, relative price and

distribution affect repeat likelihood.

The customers of credit card holders of NIBL are not really in

this state because once the card is issued they do not use it only

once. And our research found out that there are no such

customers who have used the credit card only once after they

have issued it.

4. In this step of induced to repeat regularly , the product should

be of a very attractive package. Their product quality, relative

price, distribution will be of the most attraction to the consumers.Once the customer is in this step of repeat-purchase model they

will be termed as LOYAL COSTUMERS.

NIBL present customers are dissatisfied with the present service

of Credit Card. Because of the dissatisfaction, there frequency of

use is not so high. For that NIBL needs to come up with new

attractive features in their product to lure the consumers to

repeat their purchase. This step is of a serious concern to NIBLsince the problem that we are trying to solve from this research

is on the frequency of the use of credit card where the effort of

the bank is to be focused on the product quality or the product

innovation by adding new unique features to the credit card to

induce the repetition of its use.

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So to reach this step of repeat purchase model, the only solution

for the NIBL is to increase the product quality or add new

features to the credit card.

CHAPTER 2

2.1. RESEARCH METHODOLOGY

2.1.1. Population

The sample populations for this research are the present customers of NIBL

of Kathmandu who uses credit card.

2.1.2. Definition of the information needed

The research required information about what is the credit card features

that customers want to make use it frequently. So, for this reason, both

exploratory as well as descriptive researches were conducted. Initially to

find out the problems that needed to be tested in the sample population

were derived from interviews and observation from NIBL. Thoseinformation’s highlighted the facilities that customers look for in the credit

cards which would satisfy the customers leading to its frequent use.

The information was again cross checked from the management and formed

in questionnaire. The questionnaires were distributed among 5 customers to

check its short comings. Then the needed modifications were made and

19



distributed through self monitoring to the sample customers of all three

banks. Majority of the findings are based on the Questionnaire survey

conducted.

2.1.3. Measurement and scaling Procedures

Scaling used in the research process was ordinal, ranking, and interval.

2.1.4. Questionnaire Design1

The questionnaire incorporates all the information required for this report. There were altogether 14 questions which were mostly close ended and

some were open ended. Detailed demographic information about the

customers were not required, them being present customers, so such

details have been excluded.

2.2. QUANTITATIVE RESEARCH

2.2.1. Sampling Process, Sample size and Sampling Frame

The sample populations were the present customers of NIBL. The sample

size was chosen as 80 for all as it is the appropriate size to test hypothesis.

Then through rand command, the random number to approach the

customers was derived as 2. So, every second present customer was

approached to avoid biasness. Self monitoring of the questionnaires wasdone.

2.2.2. Field Work / Data Collection

1

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Researchers have distributed their time and effort in filling the

questionnaires from the respondents. Thus data was collected from the

response of the respondent in the meeting itself. The researchers ensure

accuracy and authenticity of the responses as well as maintenance qualityof research methodology.

2.2.3. Data Preparation and Analysis

Proper and adequate editing, coding, transcription, and verification of data

were done. Each questionnaire was individually administered. Data Analysis

was done with the help of SPSS 15.0. Various parametric as well as

nonparametric tests were done to interpret the data. The tests included

one-sample t-test, regression analysis, chi-square, and correlation.

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CHAPTER 3

3.1 DATA ANALYSIS FINDINGS

Sample T-test

Description N P- Value Conclusion

Satisfaction of customers less 3

80 0.024* It is true to thepopulation which

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shows that thepresent customersare dissatisfiedwith the service orcredit card.

The affect onusage is less than2

80 0.035* It is true to the

population andsince it is less than2 it shows that theprior experiencewith the credit cardis not going toaffect its usage infuture.

The badexperience of credit card is less

than 3

80 0.025* It is true to thepopulation so notmuch of thecustomers had badexperience withthe credit cardbefore.

Regression

Description N P-Value ConclusionUsage of creditcard determinedby satisfaction ornot?

80 0.049* It is true to thepopulation and theusage of creditcard is determinedby the satisfactionof the customer onthe usage of creditcard.

Frequency and sample T-Test

Description N Sum P - Value Conclusion

Which one does business 80 It is true to the

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customers seek for?

(i) Electricity billpaymentfrom credit

cards

(ii)Phone billpayment(landline andmobile)

(iii) Water billpayment

(iv) ISP bill

payment(v) School feepayment

(vi) Discounts inpaymentsfrom creditcards

(vii) Freetransactionservice from

the memberbanks

75

85

84

72

80

90

90

0.000*

0.025*

0.043*

0.002*

0.409*

0.005*

0.037*

population and

customers seek more for

“discount in

payment from

credit card andfree transaction

service frommember banks “

among all

others given.

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Chi- Square Test

Description N P- Value Conclusion

Frequency of usage and phonebill paymentfacility isassociated

80 0.042 It is true to thepopulation andfrequency of useand phone billpayment facility isassociated.

Frequency of usage and schoolbill paymentfacility isassociated

80 0.033* It is true to thepopulation andfrequency of useand phone billpayment facility isassociated.

Frequency of usage and freetransaction facilityare associated

80 0.032* It is true to thepopulationFrequency of usage and freetransaction facilityare associated

Frequency of usage andelectricity billpayment facilityare associated

80 0.047* It is true to thepopulationFrequency of usage andelectricity billpayment facilityare associated

Frequency of usage and

discount onpayments fromcredit cardsfacility areassociated

80 0.024* It is true to thepopulation

Frequency of usage anddiscount onpayments fromcredit cardsfacility areassociated

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Frequency of usage and ISP billpayment facilityare associated

80 0.624** It is not true to thepopulation hencethe frequency of use and ISP billpayment facility isnot associated.

Frequency of usage and waterbill paymentfacility areassociated

80 0.020* It is true to thepopulationFrequency of usage and waterbill paymentfacility areassociated

Correlation

Description N PearsonCorrelation

P- Value Conclusion

Satisfactionand phonebill paymentare related

80 0.030 0.020 It is true to thepopulation and

Satisfactionand phone billpayment arerelated

Satisfactionand schoolbill paymentrelated


Satisfactionand schoolbill paymentrelated

Satisfactionand freetransactionservice frommember

banks facilityis related


Satisfactionand freetransactionservice frommemberbanks facilityis related

Satisfactionand discountwhilepayment


Satisfactionand discountwhile

26



from creditcard facility isrelated

payment fromcredit cardfacility isrelated

Satisfaction

and ISP billpaymentfacility isrelated

80 -0.30 0.849 It is not true to

the populationhence ISP billpaymentfacility andsatisfaction isnot related.

Satisfactionandelectricity billpaymentfacility isrelated


Satisfactionandelectricity billpayment

facility isrelated

Satisfactionand water billpaymentfacility isrelated


Satisfactionand water billpaymentfacility isrelated

27



** = 95% confidence level

* = 99% confidence level

3.2 CONCLUSION

Credit card is valued by the customers if it provides them with the services

or facilities more than what they have been providing now. It is seen that

there are many factors which customers look for to bring them satisfactionon the use of credit card of NIBL. The present customers are dissatisfied

with the present service provided by the credit card of NIBL. Even though

the customers are dissatisfied with the present service of the credit card of

the bank but the prior bad experience of the credit card use is not much.

The customer are dissatisfied may be because of the less facilities provided

on the use of credit card. Even for those who have faced the bad experience

28



with the use of credit card they say that it is have no effect on its usage in

the future if the bank comes up with the new services of credit card.

Given the choices of services like, phone bill payment facility, freetransaction service from the member banks facility, electricity bill payment

facility, discount on payments from credit cards, ISP bill payment facility,

water bill payment facility and school bill payment facility, “discount in payment

from credit card and free transaction service from member banks” is preferred the most among

all others given.

Till the customers are not satisfied with the service its usage will be affected coz the usage of

credit card is determined by the satisfaction of the customer on the use of credit card. Here those

satisfactions includes the facilities to be provided such as phone bill payment facility,

free transaction service from the member banks facility, electricity billpayment facility, discount on payments from credit cards, water bill

payment facility and school bill payment facility. These excluding the ISP bill

payment are all associated with their frequency of use. Similarly, those are

also related to the satisfaction of the use of credit by the customer. Till the

customers do not get those facilities in the credit card they will not be

satisfied with the services of credit card.

3.3 RECOMMENDATION

Based on our survey and the key highlights of the factors that needs to be

taken into consideration by the bank, few recommendations have been

given below in order for NIBL to solve the problem of value adding

29



proposition of the credit card which is derived by the satisfaction to the

present credit card customers.

The recommendations for NIBL are:

1. Though customers are dissatisfied with the service of the credit card

of the bank but it is seen that not much of the customers have such

bad experience and its usage is not going to get affected in the future

which shows that NIBL has the potential for the increment of the credit

card usage in future if it is able to provide with the facilities they have

asked for.

2. Those facilities viz. phone bill payment facility, free transaction

service from the member banks facility, electricity bill payment

facility, discount on payments from credit cards, water bill payment

facility and school bill payment facility are related with the satisfaction

of the use of credit card to the customers and those are also

associated with the frequency of its use by the customers so until and

unless NIBL does not introduce new facilities in their credit cards thefrequency of its use is not going to increase. So, NIBL needs to

introduce new facilities in their credit card.

3. Among all the services that were mentioned, customers have more

preference for “discount in payment from credit card and free transaction

service from member banks”. So the bank should give these facilities the

first priority while introducing with new facilities of the credit card.

30



ANNEX

31



ANNEX 1: SURVEY QUESTIONNAIRE

Case No: _____

SURVEY QUESTIONNAIRE

Dear Respondent:

We are conducting a survey on Nepal Investment Bank Ltd. and wouldlike to know your views and opinions. Would you mind spending a few

minutes helping us by completing this questionnaire? All your answers

will be treated confidentially.

Age: __________

Sex: __ Male __ Female1. How often do u use NIBL’s credit card?

Almost Every day Once a week Once a month in more

than a month

32



2. Have you had any bad experience with the credit of NIBL?

Never Sometimes Occasionally Often Always

1 2 3 4 5

3. Will you not use Credit card of NIBL in future if it provides new

facilities?

I definitely

will

I might Not at all

1 2 3

4. How satisfied with the facilities of the credit card?

Very

Satisfied

Quite

satisfied

Neither satisfied

nor dissatisfied

Quite

dissatisfied

Very

dissatisfied

1 2 3 4 5

5. Rate your preference of the following facilities of credit card. (1 to the

most preferred and 7 to the least preferred)

33



Electricity bill payment from credit cards ____________________

Phone bill payment (landline and mobile) ____________________

Water bill payment ___________________

ISP bill payment ___________________

School fee payment ___________________

Discounts in payments from credit cards __________________

Free transaction service from the member banks

__________________

6. I will use credit card frequently if NIBL provides the facility of “ free

transaction service form any member banks”

5--------------4----------------3----------------2----------------1

7. I will use credit card frequently if NIBL provides the facility of “

discount in payments from the credit cards”

5--------------4----------------3----------------2----------------1

8. I will use credit card frequently if NIBL provides the facility of “ school

fee payment from credit card”

5--------------4----------------3----------------2----------------1

9. I will use credit card frequently if NIBL introduces the facility of “ISP

bill payment”

5--------------4----------------3----------------2----------------1

10.I will use credit card frequently if NIBL introduces the facility of “ water

bill payment”

11. 5--------------4----------------3----------------2----------------1

12.I will use credit card frequently if NIBL introduces the facility of “

Electricity bill payment”

34



5--------------4----------------3----------------2----------------1

13.I will use credit card frequently if NIBL introduces the facility of “Phone

bill payment”

5--------------4----------------3----------------2----------------1

14. I will be satisfied if NIBL introduces the above facilities of Credit

card.

Very

Satisfied

Quite satisfied Neither satisfied nor

dissatisfied

1 2 3

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